[Federal Register Volume 89, Number 95 (Wednesday, May 15, 2024)]
[Rules and Regulations]
[Pages 42602-42762]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08791]
[[Page 42601]]
Vol. 89
Wednesday,
No. 95
May 15, 2024
Part II
Department of the Interior
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Bureau of Ocean Energy Management
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30 CFR Part 585
Bureau of Safety and Environmental Enforcement
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30 CFR Part 285
Renewable Energy Modernization Rule; Final Rule
Federal Register / Vol. 89 , No. 95 / Wednesday, May 15, 2024 / Rules
and Regulations
[[Page 42602]]
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DEPARTMENT OF THE INTERIOR
Bureau of Ocean Energy Management
30 CFR Part 585
Bureau of Safety and Environmental Enforcement
30 CFR Part 285
[Docket No. BOEM-2023-0005]
RIN 1010-AE04
Renewable Energy Modernization Rule
AGENCY: Bureau of Ocean Energy Management and Bureau of Safety and
Environmental Enforcement, Interior.
ACTION: Final rule.
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SUMMARY: The Department of the Interior (the Department or DOI), acting
through the Bureau of Ocean Energy Management (BOEM) and the Bureau of
Safety and Environmental Enforcement (BSEE) (``the agencies''), is
finalizing regulatory amendments to its renewable energy regulations
under the authority of the Outer Continental Shelf Lands Act (OCSLA).
The notice of proposed rulemaking (NPRM) for this final rule was
published in the Federal Register on January 30, 2023. While the NPRM
contemplated amendments only to the Department's existing renewable
energy regulations that are administered by BOEM, this final rule also
finalizes regulatory amendments previously proposed by BOEM that are
now administered by BSEE and includes amendments to regulations
resulting from the ``Reorganization of Title 30--Renewable Energy and
Alternative Uses of Existing Facilities on the Outer Continental
Shelf'' direct final rule, issued by the Department on January 31,
2023. This final rule eliminates unnecessary requirements for the
deployment of meteorological (met) buoys; increases survey flexibility;
improves the project design and installation verification process;
establishes a public Renewable Energy Leasing Schedule; reforms BOEM's
renewable energy auction regulations; tailors financial assurance
requirements and instruments; clarifies safety management system
regulations; revises other provisions; and makes technical corrections.
This final rule advances the Department's energy policies in a safe and
environmentally sound manner that will provide a fair return to the
U.S. taxpayer.
DATES: This final rule is effective on July 15, 2024.
ADDRESSES: The Bureau of Ocean Energy Management (BOEM) has established
a docket for this action under Docket ID No. BOEM-2023-0005. All
documents in the docket are listed on the https://www.regulations.gov
website and can be found by entering the Docket ID No. in the ``Enter
Keyword or ID'' search box and clicking ``search''.
FOR FURTHER INFORMATION CONTACT: For questions about this final action
regarding 30 CFR parts 585 and 586, contact Nabanita Modak Fischer,
Office of Regulations, BOEM, 45600 Woodland Road, Sterling, Virginia
20166, at email address [email protected] or at telephone
number (703) 787-1415; and Karen Thundiyil, Chief, Office of
Regulations, BOEM, 1849 C Street NW, Washington, DC 20240, at telephone
number (202) 742-0970 or email address [email protected]. For
questions about this final action regarding 30 CFR part 285, contact
Kirk Malstrom, Chief, Regulations and Standards Branch, BSEE, at
telephone number (202) 258-1518 or email address [email protected].
Individuals in the United States who are deaf, deafblind, hard of
hearing, or have a speech disability may dial 711 (TTY, TDD, or
TeleBraille) to access telecommunications relay services. These
services are available 24 hours a day, 7 days a week, to leave a
message or question with the point-of-contact. You will receive a reply
during normal business hours. Individuals outside the United States
should use the relay services offered within their country to make
international calls to the point-of-contact in the United States.
SUPPLEMENTARY INFORMATION:
Preamble acronyms and abbreviations. Multiple acronyms and
abbreviations are included in this preamble. While this list may not be
exhaustive, to ease the reading of this preamble and for reference
purposes, the agencies define the following terms and acronyms here:
ANCSA Alaska Native Claims Settlement Act of 1971
ANSI American National Standards Institute
API American Petroleum Institute
ASLM Assistant Secretary for Land and Minerals Management
ASSP American Society of Safety Professionals
BOEM Bureau of Ocean Energy Management
BSEE Bureau of Safety and Environmental Enforcement
CAA Clean Air Act of 1970
CAB Conformity Assessment Body
CBA Community Benefit Agreement
CEQ Council on Environmental Quality
CFR Code of Federal Regulations
COP Construction and Operations Plan
CRA Congressional Review Act
CSSCR Critical Safety Systems Commissioning Records
CSSE Critical Safety Systems and Equipment
CVA Certified Verification Agent
CZM Coastal Zone Management
CZMA Coastal Zone Management Act of 1972
Department U.S. Department of the Interior
DNCI Determination of No Competitive Interest
DNV Det Norske Veritas
DM Departmental Manual
DOE U.S. Department of Energy
DOI U.S. Department of the Interior
EA Environmental Assessment
EBM Ecosystem-based Management
EIS Environmental Impact Statement
E.O. Executive Order
EPAct Energy Policy Act of 2005
ESA Endangered Species Act of 1973
ESP Environmental Studies Program
FCC Federal Consistency Certification
FDR Facility Design Report
FERC Federal Energy Regulatory Commission
FIR Fabrication and Installation Report
FOIA Freedom of Information Act
FOWT Floating Offshore Wind Turbines
FR Federal Register
FSN Final Sale Notice
G&G Geological and Geophysical
GAP General Activities Plan
GHG Greenhouse Gas
IBLA Interior Board of Land Appeals (U.S. Department of the
Interior)
IC Information Collection
IEC Inclusive Engineering Consortium
IECRE IEC System for Certification to Standards Relating to
Equipment for Use in Renewable Energy
IRA Inflation Reduction Act
ISO Independent System Operator
LPA Labor Peace Agreement
MACO Mid-Atlantic Council on the Ocean
MMS Minerals Management Service
MOU Memorandum of Understanding
NAGPRA Native American Graves Protection and Repatriation Act
NCCOS National Centers for Coastal Ocean Science
NEPA National Environmental Policy Act of 1969
NHPA National Historic Preservation Act of 1966
NMFS National Marine Fisheries Service
NMSA National Marine Sanctuaries Act of 1972
NOAA National Oceanic and Atmospheric Administration
NONC Notice of Noncompliance
NROC Northeast Regional Ocean Council
NPRM Notice of proposed rulemaking
NRSRO Nationally Recognized Statistical Rating Organization
NTL Notice to Lessee
NWP Nationwide Permit
OCS Outer Continental Shelf
OCSLA Outer Continental Shelf Lands Act
OEM Original Equipment Manufacturer
OIRA Office of Information and Regulatory Affairs
OMB Office of Management and Budget
ONRR Office of Natural Resources Revenue
OSRP Oil Spill Response Plan
OSW Offshore Wind
[[Page 42603]]
PATON Private Aids to Navigation
PDE Project Design Envelope
PEIS Programmatic Environmental Impact Statement
PLA Project Labor Agreement
PPA Power Purchase Agreement
PRA Paperwork Reduction Act of 1995
PSN Proposed Sale Notice
Pub. L. Public Law
PVR Project Verification Report
RFA Regulatory Flexibility Act of 1995
RFI Request for Information
RHA Rivers and Harbors Act of 1899
RIA Regulatory Impact Analysis
RNA Rotor-nacelle Assembly
ROP Regional Ocean Partnerships
ROW Right-of-Way
RTO Regional Transmission Organization
RUE Right-of-Use-and-Easement
S&P Standard and Poor's
SAP Site Assessment Plan
SBREFA Small Business Regulatory Enforcement Fairness Act of 1996
SIEBA Standardizing Integrated Ecosystem-Based Assessments
SME Subject Matter Expert
SMS Safety Management System
UMRA Unfunded Mandates Reform Act of 1995
USACE U.S. Army Corps of Engineers
U.S.C United States Code
USCG U.S. Coast Guard
USEPA U.S. Environmental Protection Agency
WCOA West Coast Ocean Alliance
WTG Wind Turbine Generator
Background information. On January 30, 2023, the Department issued
an NPRM to modernize its regulations to facilitate the development of
offshore wind (OSW) energy resources (88 FR 5968). On January 31, 2023,
the Department issued the ``Reorganization of Title 30--Renewable
Energy and Alternative Uses of Existing Facilities on the Outer
Continental Shelf'' direct final rule (88 FR 6376) following the
delegation of authority to BSEE to administer some of the regulations
addressed in the NPRM.\1\ The agencies have summarized the significant
comments received on the proposed rule and have provided responses to
them in this preamble.
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\1\ 219 DM 1, DOI Departmental Manual (Sept. 14, 2022).
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Organization of this document. The information in this preamble is
organized as follows:
I. General Information
A. Executive Summary
B. Does this action apply to me?
C. Where can I get a copy of this document and other related
information?
II. Background
A. BOEM and BSEE Statutory and Regulatory Authority and
Responsibilities
B. History of Renewable Energy Modernization Rule
C. Purpose of This Rulemaking
D. Summary of the Proposed Renewable Energy Modernization Rule
III. Summary of the Significant Provisions
A. Site Assessment Facilities
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
B. Project Design Envelope
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
C. Geophysical and Geotechnical Surveys
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
D. Certified Verification Agent and Engineering Report
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
E. Renewable Energy Leasing Schedule
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
F. Lease Issuance Procedure
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
G. Risk Management and Financial Assurance
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
H. Safety Management Systems (SMS)
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
I. Inspections
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
J. Other Proposed Changes in Part 285
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
K. Other Proposed Changes in Part 585
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
L. Potential Revisions to Regulations Governing Research
Activities
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
M. Potential Revisions to Regulations Governing Transmission
1. What did the Department propose?
2. What are the key public comments?
3. What is the Department finalizing?
N. General Comments and Responses
IV. Summary of Cost, Economic Impacts, and Additional Analyses
Conducted
A. What are the affected resources?
B. What are the economic impacts?
C. What are the benefits?
D. What Tribal engagement activities were conducted?
V. Section-by-Section Analysis
A. 30 CFR Part 285
B. 30 CFR Part 585
VI. Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review, as
Amended by Executive Order 14094: Modernizing Regulatory Review, and
Executive Order 13563: Improving Regulation and Regulatory Review
B. Regulatory Flexibility Act (RFA)
C. Small Business Regulatory Enforcement Fairness Act (SBREFA)
D. Unfunded Mandates Reform Act (UMRA)
E. Executive Order 12630: Governmental Actions and Interference
With Constitutionally Protected Property Rights
F. Executive Order 13132: Federalism
G. Executive Order 12988: Civil Justice Reform
H. Executive Order 13175: Consultation and Coordination with
Indian Tribal Governments
I. Paperwork Reduction Act (PRA)
J. National Environmental Policy Act (NEPA)
K. Data Quality Act
L. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
M. Congressional Review Act (CRA)
I. General Information
A. Executive Summary
1. Purpose of This Regulatory Action
Congress authorized the Secretary of the Interior to grant Outer
Continental Shelf (OCS) leases for renewable energy activities when it
enacted the Energy Policy Act of 2005. The Secretary delegated
authority to BOEM and BSEE to carry out development and oversight of
the Nation's offshore energy resources.
This action finalizes certain provisions proposed in the Renewable
Energy Modernization Rule (88 FR 5968, January 30, 2023). A summary of
the key provisions is included below. This final rule facilitates the
development of OCS renewable energy and supports the Department's
commitment to ensuring safe and responsible domestic energy production.
The final rule modernizes the offshore renewable energy regulations,
streamlines processes, clarifies regulatory provisions, enhances
compliance provisions, and corrects technical errors and
inconsistencies. Through these changes, the Department aims to reduce
administrative burdens and reduce cost and uncertainty while creating
greater regulatory flexibility in a rapidly evolving industry. This
final rule updates OCS renewable energy regulations to reflect lessons
learned since the regulations were originally promulgated in 2009. The
Department projects this action will save the renewable energy industry
$1 billion over 20 years.
2. Summary of the Key Provisions
The final rule contains eight key provisions:
(1) Eliminating unnecessary requirements for the deployment of met
buoys (30 CFR part 585, subpart G).
[[Page 42604]]
This action finalizes the elimination of the existing regulations
that required on-lease site assessment plans (SAPs) and BOEM permitting
for met buoys. However, deployment of met buoys that qualify as
obstructions deployed in U.S. navigable waters under section 10 of the
Rivers and Harbors Act (RHA) would continue to require US Army Corps of
Engineers (USACE) permits. Met buoys are also typically required to be
marked and lighted in accordance with a U.S. Coast Guard private aids
to navigation (PATON) approval. Met buoys will continue to require U.S.
Coast Guard PATON approval under 33 CFR part 66 and 14 U.S.C. 545. This
final rule clarifies that the elimination of the Department's
regulations requiring SAPs and BOEM permitting for met buoys does not
reduce or eliminate the need for BOEM's environmental review of site
characterization (geotechnical and geophysical surveys, biological
surveys) and site assessment activities (deployment of met towers and
buoys). This final rule also notes that the USACE may incorporate its
own decommissioning requirements in permits applicable to met buoys but
BSEE's decommissioning requirements in part 285 will apply to met buoys
if the USACE has not required a decommissioning obligation. BSEE
expects to utilize its regulatory authority for decommissioning of
buoys in limited circumstances.
(2) Increasing survey flexibility (30 CFR part 585, subpart G).
This action finalizes the provision allowing deferral of some
geotechnical surveys until the submission of the Facility Design Report
(FDR). This change is being finalized to allow more time to complete
the required geotechnical surveys and provide greater flexibility in
designing projects. At the same time, this action clarifies that the
submission of geophysical data, including subsea archaeological
surveys, cannot be deferred to the FDR and will continue to be required
in a construction and operations plan (COP).
(3) Improving the project design and installation verification
process (30 CFR part 285, subpart G).
This action finalizes the provisions that expanded the role of the
certified verification agent (CVA) to include verification of the
design and commissioning of the Critical Safety Systems and Equipment
(CSSE) to ensure that any activities authorized by BSEE are carried out
safely. The reliance on CVAs will provide an independent source of
review for key stages of project development and help to establish
public confidence in the renewable energy industry. Also, to reduce
confusion and ambiguity, the final rule clarifies BSEE's expectations
for CVA ``verification'' and ``certification'' that are practical and
consistent with the policy goal of promoting safety.
(4) Establishing a Public Renewable Energy Leasing Schedule (30 CFR
part 585, subpart B).
This rule finalizes the renewable energy leasing schedule
amendments as proposed. The schedule for leasing will provide increased
certainty and enhanced transparency and is intended to facilitate
planning by industry, the States, and other stakeholders. The schedule
of anticipated leasing would be updated at least once every 2 years.
This final rule provides clarification that the offshore wind leasing
schedule should not be confused with BOEM's National Outer Continental
Shelf Oil and Gas Leasing Program schedule and explains that BOEM is
committed to following the Department's policy on consultation with
Tribes where there are Department actions that may have a substantial
direct effect on a Tribe(s).
(5) Reforming BOEM's renewable energy auction regulations (30 CFR
part 585, subpart C).
This rule finalizes the pre- and post-auction procedure amendments
as proposed, with added clarifications. These amendments address the
use of bidding credits and more clearly outline auction processes and
requirements. This final rule describes how BOEM operationalizes its
commitment to coordinate with Tribes and conduct consultation with the
Tribal leadership for Tribes that may be affected by any leases,
easements, or right-of-way (ROWs); and notes that the regulations
require Tribal consultation prior to the issuance of a lease and during
area identification before competitive leasing.
Additionally, in this final rule, BOEM finalizes the auction
process as proposed, including providing clarification for how BOEM
will consider the use of bidding credits on a case-by-case basis
specific to the lease sale conditions.
(6) Financial assurance requirements and instruments (30 CFR part
585, subpart F).
This action finalizes the use of credit ratings, requiring
financial assurance at a more relevant time, allowing for staged
funding of decommissioning accounts, and adding letters of credit as an
acceptable financial assurance instrument. In addition, this final rule
allows for a lessee to demonstrate its capacity to meet financial
assurance requirements for lease or grant activities based on
electricity sales contracts and net income projections.
(7) Clarifying safety management system regulations (30 CFR part
285, subpart H).
This final rule clarifies the information requirements for safety
management systems (SMS) and expectations regarding SMS standards. It
adds a provision to incentivize lessees and grantees to obtain a safety
management certification from recognized accreditation organizations to
reduce the frequency and intensity of regulatory oversight activities.
The final rule also clarifies that lessees and grantees are required to
have and use an SMS for all OCS activities undertaken pursuant to a
lease, from site assessment through decommissioning. The final rule
also establishes a performance-based approach to promote flexibility in
determining the best way to ensure the safety of personnel on and near
OCS renewable energy facilities during activities covered by the SMS.
(8) Other provisions.
This action finalizes all technical corrections as proposed. The
most significant of these provisions will restructure commercial lease
terms into four periods tied to activities required to develop the
lease; explicitly allow regulatory departures before and after a lease
or grant is issued or made; authorize civil penalties without either
notice or a time period for corrective action when violations
constitute a threat of serious, irreparable, or immediate harm or
damage; add specific procedures regarding lease segregation and
consolidation; and standardize the annual rental rate per acre across
most grants.
3. Costs and Benefits
The Regulatory Impact Analysis (RIA) estimates the costs and
benefits of the rule. The RIA can be found in the rulemaking docket
(Docket No. BOEM-2023-0005). BOEM, on behalf of the Department,
conducted a Regulatory Impact Analysis to consider the costs and
benefits of the rule. Most of the revisions in the rule have negligible
or no cost impact, while others may have second-order benefits that are
difficult to quantify. BOEM identified four elements of the rule that
have quantifiable effects. Three of those changes (met buoy
requirements, financial assurance, and geotechnical survey revisions)
provide compliance cost savings and one, SMS reporting, has minor
compliance cost burdens. In net, BOEM estimates these changes could
save the OCS renewable energy industry approximately $127 million in
annualized cost savings over the 20-year period of analysis (3 percent
discounting). In addition to these
[[Page 42605]]
quantitative costs and benefits, the rule also provides qualitative
benefits. This rule provides additional clarity and certainty, while
streamlining the regulatory framework. The changes from this rule will
facilitate more expedient and responsible development of offshore
renewable energy projects.
B. Does this action apply to me?
Entities potentially affected by this action include, but are not
limited to, all current and future OCS renewable energy lessees,
grantees, and operators.
C. Where can I get a copy of this document and other related
information?
In addition to being available in the docket, an electronic copy of
this final rule will also be available on the internet. Following
signature by the Principal Deputy Assistant Secretary of Land and
Minerals Management (ASLM), BOEM will post a copy of this final rule
at: https://www.boem.gov/about-boem/regulations-guidance/published-rules. Following publication in the Federal Register (FR), the
published version of the final rule will be available on BOEM's and
BSEE's respective websites.
II. Background
A. BOEM and BSEE Statutory and Regulatory Authority and
Responsibilities
Congress authorized the Secretary to grant OCS leases for renewable
energy activities when it enacted the Energy Policy Act of 2005, which
amended OCSLA by adding a new subsection 8(p).\2\ Subsection 8(p) of
OCSLA authorizes the Secretary to award OCS leases, ROWs, and right-of-
use and easement grants (RUEs) for activities not otherwise authorized
by other applicable law, if those activities ``produce or support
production, transportation, storage, or transmission of energy sources
other than oil or gas.'' Subsection 8(p) requires the Secretary to
award such leases, ROWs, and RUEs on a competitive basis unless the
Secretary determines, following public notice, that competitive
interest does not exist. Subsection 8(p) also authorizes the Secretary
to issue regulations to carry out the subsection's grant of authority.
The Secretary delegated that authority to BOEM's and BSEE's
predecessor, the Minerals Management Service (MMS). Subsection 8(p)(8)
of OCSLA (43 U.S.C. 1337(p)(8)) authorizes the Secretary to ``issue any
necessary regulations to carry out this subsection.'' Subsection
8(p)(10) (43 U.S.C. 1337(p)(10)) of OCSLA states ``this subsection does
not apply to any area on the Outer Continental Shelf within the
exterior boundaries of any unit of the National Park System, National
Wildlife Refuge System, or National Marine Sanctuary System, or any
National Monument.'' NOAA may consider authorizing renewable energy
activities, and/or activities in support of the development of
renewable energy, under the authority of the National Marine
Sanctuaries Act, through one or more of the following mechanisms--
General Permits, Authorizations, Certifications, and Special Use
Permits.
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\2\ Codified at 43 U.S.C. 1337(p).
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B. History of Renewable Energy Modernization Rule
On March 20, 2006, the Secretary delegated the responsibility for
regulating OCS renewable energy activities to MMS,\3\ the predecessor
agency to BOEM and BSEE. MMS promulgated the first OCS renewable energy
regulations on April 29, 2009 (74 FR 19638). Between May 19, 2010, and
August 29, 2011, Secretary Salazar issued Secretary's Order 3299 and
two amendments that ultimately divided MMS into three separate
agencies: BOEM, BSEE, and the Office of Natural Resources Revenue
(ONRR). The Secretary emphasized the importance of separate and
independent safety and environmental oversight when testifying before
Congress on May 26, 2010:
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\3\ 218 DM 1-6; 218 DM 8.
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The Deepwater Horizon tragedy and the massive spill have made the
importance and urgency of a reorganization of this nature ever more
clear, particularly the creation of a separate and independent safety
and environmental enforcement entity. We will responsibly and
thoughtfully move to establish independence and separation for this
critical mission so that the American people know they have a strong
and independent organization ensuring that energy companies comply with
their safety and environmental protection obligations.\4\
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\4\ Minerals Management Service Reorganization: Special Hearing
Before the Subcomm. on Dept. of the Interior, Environment & Related
Agencies of the S. Comm. On Appropriations, S. Hrg. 111-1035, at 12
(2010) (statement of Ken Salazar, Sec'y of the Interior).
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Pursuant to section 3 of Secretary's Order 3299, Amendment No. 2,
BOEM ``exercise[s] the conventional (e.g., oil and gas) and renewable
energy-related management functions of the [MMS] not otherwise
transferred pursuant to this Order including, but not limited to,
activities involving resource evaluation, planning, and leasing.'' \5\
Under section 4 of Secretary's Order 3299, Amendment No. 2, BSEE
exercises ``safety and environmental enforcement functions,'' including
``the authority to inspect, investigate, summon witnesses and produce
evidence, levy penalties, cancel or suspend activities, and oversee
safety, response, and removal preparedness.'' \6\
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\5\ Sec'y of the Interior Order 3299, as amended and issued Aug.
29, 2011, available at https://www.doi.gov/sites/doi.gov/files/elips/documents/3299a2-establishment_of_the_bureau_of_ocean_energy_management_the_bureau_of_safety_and_environmental_enforcement_and_the_office_of_natural_resources_revenue.pdf.
\6\ Id.
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Section 4 of Secretary's Order 3299, Amendment 2, assigned the
renewable energy program to BOEM ``until such time that the [ASLM]
determines that an increase in activity justifies transferring the
inspection and enforcement functions to [BSEE].'' On October 18, 2011,
the Department's regulations that were administered by BOEM were
codified at 30 CFR chapter V, and its renewable energy regulations were
located in 30 CFR part 585.\7\ Subsequently, in September 2013, the DOI
Office of Inspector General (OIG) issued a report supporting the policy
of independent regulatory oversight and enforcement in the renewable
energy program and recommending implementation of that policy through a
transfer of those responsibilities from BOEM to BSEE.\8\ The OIG noted
that ``allowing the bureau responsible for planning and leasing
renewable energy projects [i.e., BOEM] to also formulate the policies
for inspection and enforcement is contrary to the independent oversight
and separation of duties envisioned in [Secretary's Order 3299] as
originally issued.'' \9\ In the years since the 2009 rulemaking and the
DOI OIG report in 2013, the renewable energy industry and BOEM's and
BSEE's renewable energy programs have grown substantially.
Consequently, the Department promulgated a rule of agency organization
and procedure entitled ``Reorganization of Title 30--Renewable Energy
and Alternate Uses of Existing Facilities on the Outer Continental
Shelf'' (``Reorganization Rule'') that transferred existing safety and
environmental oversight and enforcement regulations governing OCS
renewable energy activities from 30 CFR
[[Page 42606]]
part 585, administered by BOEM, to 30 CFR part 285, administered by
BSEE.
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\7\ Reorganization of Title 30: Bureaus of Safety and
Environmental Enforcement and Ocean Energy Management, 76 FR 64432
(Oct. 18, 2011).
\8\ Office of Inspector Gen., Dept of Interior, U.S. Department
of the Interior's Offshore Renewable Energy Program 9 (2013) (Report
No. CR-EV-BOEM-0001-2013).
\9\ Id.
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Over the past decade, BOEM has conducted twelve competitive
renewable energy lease sales and administered thirty-four commercial
leases. Through these activities and working actively with relevant
stakeholders, the Department identified opportunities to modernize its
regulations and better facilitate the development of offshore wind
energy resources. BOEM held multiple public meetings and engaged in
significant stakeholder engagement and received recommendations from
industry, technical and scientific organizations, other government
agencies and other stakeholders on the reform of the renewable energy
program. Since then, the Department has refined its goals for meeting
U.S. climate and renewable energy objectives.
The Department determined that aspects of its renewable energy
regulations could be streamlined and improved since the last
rulemaking.
On January 30, 2023, the Department proposed the Renewable Energy
Modernization Rule to reduce regulatory burdens and streamline the
regulations, incorporate the recommendations from the stakeholders, and
achieve the U.S. climate and renewable energy goals. 88 FR 5968. The
proposed Renewable Energy Modernization Rule was the result of over ten
years of effort by the Department and industry to identify and resolve
the obstacles to establishing an effective and commercially viable
offshore renewable energy industry on the OCS.
C. Purpose of This Rulemaking
This final rule includes regulations administered by BOEM (30 CFR
parts 585 and 586) and BSEE (30 CFR part 285), as identified in the
Reorganization Rule. A summary of key provisions is provided below. The
Department believes that this final rule will facilitate the
development of OCS renewable energy and promote U.S. climate and
renewable energy objectives in a safe and environmentally sound manner
while providing a fair return to the U.S. taxpayer. The final rule
reforms the renewable energy regulations, streamlines processes,
clarifies ambiguous provisions, enhances compliance provisions, and
corrects technical errors and inconsistencies. Through these changes,
the Department aims to reduce administrative burdens, reduce costs and
uncertainty, and introduce greater regulatory flexibility in a rapidly
evolving industry to foster the growth of OCS renewable energy, while
maintaining environmental safeguards. The Department's regulatory
changes in this final rule are not intended to contradict, preempt,
supersede, alter, or otherwise be incompatible with the authority and
jurisdiction of other Federal agencies or entities or their
regulations. Rather, the Department's purpose for these changes is to
ensure the development of renewable energy on the OCS is carried out in
a manner that provides for safety and protection of the environment, in
addition to the other factors as specified in OCSLA Section 8(p).
D. Summary of the Proposed Renewable Energy Modernization Rule
On January 30, 2023, the Department published the NPRM, which
proposed amendments to 30 CFR part 585. The NPRM proposed key
provisions that would accomplish the following:
(1) Eliminate SAP requirements for met buoys;
(2) Adopt a flexible and performance-based approach to geophysical
and geotechnical surveying;
(3) Conform the CVA review standard to industry practice and
provide flexibility in the CVA nomination and engineering report
submittal process;
(4) Clarify auction procedures;
(5) Align financial assurance requirements with the risk to U.S.
taxpayers and permit incremental funding of decommissioning accounts;
(6) Clarify and enhance safety management requirements; and
(7) Make other revisions and technical corrections that would
improve the Department's OCS renewable energy regulatory program.
III. Summary of the Significant Provisions
The following section provides a summary of key comments and
responses regarding significant provisions and the Department's
rationale for the final decisions and amendments in those significant
provisions.
A. Site Assessment Facilities
1. What did the Department propose?
(a) 30 CFR 585.104 Do I need a BOEM lease or other authorization to
produce or support the production of electricity or other energy
product from a renewable energy resource on the OCS?
The proposed rule clarified that off-lease site assessment
facilities would not require a limited lease and the Department would
not conduct any case-by-case determinations regarding whether off-lease
site assessment activities require a lease. This proposed clarification
of BOEM's authority over off-lease site assessment activities applied
to both met buoys and met towers. Although met towers have greater
environmental impacts than met buoys, BOEM did not believe this
proposed regulatory change would increase environmental risk due to
USACE permitting requirements, common use of met buoys, and BOEM's
existing practice.
(b) 30 CFR 585.113 Definitions.
The Department proposed to define the following terms:
Bidding credit(s), commercial activities, commercial operations,
critical safety system, engineered foundation, fabrication, lease area,
multiple factor auction, project design envelope, provisional winner,
receipt, and site assessment activities.
(c) 30 CFR 585.600 What plans must I submit to BOEM before I
conduct activities on my lease or grant?
The existing regulations required lessees to submit an SAP for BOEM
approval before conducting any site assessment activities on their
commercial leases. The proposed rule proposed to exempt floating site
assessment facilities, such as met buoys, from the SAP requirement.
Under the proposed rule, a lessee planning to install an industry-
standard met buoy using a gravity anchor for site assessment would not
require an SAP.
The proposal intended to allow lessees to deploy met buoys more
efficiently and at a reduced cost given that an SAP would no longer be
required. Instead, a met buoy would generally be authorized by USACE
permitting requirements under section 10 of the Rivers and Harbors Act
(such as Nationwide Permit (NWP) 5 that applies to Scientific
Measurement Devices, see 86 FR 73522, or a similar USACE general permit
or individual permit). Under the proposed rule, BOEM would no longer
authorize met buoys on the OCS. Consequently, the proposed rule would
have also eliminated the need for a Clean Air Act (CAA) air quality
permit from the U.S. Environmental Protection Agency (USEPA) for on-
lease met buoys with backup diesel generators because these buoys would
fall outside the CAA definition of an ``OCS source.'' To accommodate
the SAP changes, BOEM proposed several ancillary regulatory changes,
including eliminating deadlines for SAP submittals, decoupling the
requirement to operate under a Safety Management System (SMS) from SAP
submission, and removing references to terminology that relates
primarily to buoys (e.g., anchors,
[[Page 42607]]
chains, moorings) in the SAP regulations.
USACE NWP 5 or a similar USACE general permit complies with current
Federal environmental laws and governs deployment of devices whose
purpose is to measure and record scientific data and that result in no
more than minimal individual and cumulative adverse environmental
impacts. Under the proposed rule, site assessment activities would
still require an SMS, and the Department would still maintain oversight
of site assessment activities.
(d) 30 CFR 585.900(c) Who must meet the decommissioning obligations
in this subpart?
The proposed rule also proposed to amend the decommissioning
regulations to avoid duplicative or conflicting requirements for the
removal of met buoys. Under the proposed rule, a lessee would
decommission its met buoys according to the USACE requirements of an
issued permit. In these circumstances, USACE would be responsible for
determining on a case-by-case basis if financial assurance is required
at the time of buoy installation. If for some reason the USACE did not
require its buoy decommissioning, BSEE retains the authority to require
decommissioning of the buoys. BSEE expects to utilize its regulatory
authority for decommissioning of buoys in limited circumstances. In
addition, BOEM may request additional financial assurance under Sec.
585.517(b), or if necessary, apply financial assurance held under Sec.
585.516(a)(1). Further, BOEM retains the authority to require
decommissioning financial assurance for buoy(s) that remain in place
when the agency authorizes subsequent construction and operations on
the OCS under a COP or GAP. Under the proposed rule, the buoys would be
authorized and installed pursuant to USACE regulations and USACE would
assume responsibility for ensuring that any required removal takes
place in accordance with the terms and conditions of the permit and at
USACE's discretion. In these circumstances, the USACE would be
responsible for determining on a case-by-case basis if financial
assurance is required.
2. What are the key public comments?
(a) On-lease met buoys.
Comment: Several commenters expressed concern or opposition to the
proposal. A commenter discussed the impact that BOEM's proposal to
delay the SAP to be concurrent with the COP would have on the planning
process. The commenter stated that the proposal delays public awareness
of the plan and an opportunity to ``affect it early in the planning
process.'' The commenter also stated that if BOEM were to merge the SAP
and COP phases, then a project Environmental Impact Statement (EIS)
would have to be prepared prior to lease award.
Response: The purpose of an SAP is to describe proposed data
collection facilities, such as a meteorological (met) tower or buoy.
Such facilities are often--but not always--needed to collect the data
required for inclusion in a COP. Under the existing regulations, an SAP
is superfluous for a proposed project that does not include
installation of a met tower or buoy, yet the existing regulations still
require the submittal and approval of such plans. The final rule
eliminates this formal requirement but does not affect BOEM's
responsibilities to conduct environmental reviews or consultations.
Therefore, this change does not require preparation of an EIS prior to
a lease award.
Comment: Several commenters expressed concern with the language
under Sec. 585.600(b)(4) stating that BOEM would have discretion to
waive certain information or analysis requirements in a proposed SAP if
the applicant can demonstrate that the information is not needed or
required by a state's coastal management program. According to the
commenters, the language implies that BOEM can make decisions on behalf
of coastal states regarding what information is sufficient for Federal
consistency review. In an effort to promote cooperation among BOEM,
lessees, and coastal states, a commenter suggested BOEM revise the
amended language to limit the exemption provision to the necessary data
and information required to initiate Federal consistency review; make
explicit reference to National Oceanic and Atmospheric Administration
(NOAA) Federal consistency regulations; and involve States in the
decision-making process for information waiving requirements. Another
commenter suggested that BOEM revise the amended language to limit the
exemption provision, noting that without the identified data and
information described in 15 CFR 930.58 and in a state's approved
enforceable policies, a State would not be able to conduct a Federal
consistency review and be required to request this information, further
delaying the Federal consistency review process.
Response: The commenters are correct that neither the applicant nor
BOEM can dictate what data and information is deemed necessary to
conduct an adequate consistency review based on the enforceable
policies of a State's coastal management program. The final rule,
however, would not have that effect. As noted in the proposed rule
preamble, the applicant would need to ``demonstrate that . . . the
information is not needed or required by a State's coastal management
program'' before BOEM would grant a waiver and this demonstration would
entail confirmation with the affected State.
Comment: BOEM received other comments opposing the proposed
revisions and stating that the proposal not to require an SAP for met
buoys pursuant to Sec. 585.600 may limit environmental review, data
collection, siting considerations, and buoy removal planning
requirements for developers. Commenters also offered suggestions
regarding anchor abandonment and duplication in buoy siting. Commenters
requested more information from BOEM on how these concerns would be
addressed under this proposed change. The commenter also stated they,
``look forward to contributing to defining `unnecessary requirements'
within the Makah area of sovereign interest.''
Response: This rulemaking does not reduce or eliminate BOEM's
environmental review of site characterization (geotechnical and
geophysical surveys, biological surveys) and site assessment activities
(deployment of met towers and buoys). This review takes place during
BOEM's development of an Environmental Assessment (EA) pursuant to
NEPA, which begins with a Notice of Intent to prepare a NEPA analysis
(and related public comment period) and concludes during the period
between publication of a Proposed Sale Notice (PSN) and a Final Sale
Notice (FSN) (i.e., prior to issuing a lease). These EAs analyze
potential environmental impacts of activities expected to take place
following lease issuance, including site characterization and site
assessment activities. BOEM also notes that USACE may have
decommissioning requirements applicable to met buoys, depending on the
type of permit used and subject to district review and discretion.
Finally, BSEE has authority to require lessees to decommission
facilities installed within their leases under 30 CFR 285.900 and
285.90. BSEE expects to utilize its regulatory authority for
decommissioning of buoys in limited circumstances. This decommissioning
authority is not constrained or affected by BOEM's changes to the SAP
regulations. Since this comment was submitted, BOEM conducted
government-to-government consultations with this commenter on the
proposed rule generally and this comment in particular. BOEM also has
[[Page 42608]]
initiated and held government-to-government consultations and staff-
level meetings with the commenter and four additional Indian Tribes to
discuss potential impacts and to solicit and fully consider their views
on the proposed rulemaking.
Comment: Another commenter stated the proposal would give greater
jurisdiction and flexibility to BOEM and allow for more self-regulation
of OSW developers. Further, the commenter stated that permitting met
buoys and eliminating SAPs by delegating the responsibility to USACE
would reduce public review and transparency, remove met buoys from
OCSLA jurisdiction, and strip the requirement of CAA permits being
issued for met buoys, which use diesel fuel for energy backup systems.
Response: BOEM's proposed removal of the SAP requirement for met
buoys simply resolves a significant regulatory overlap. The proposed
rule would not delegate any authority to USACE that it does not already
possess and exercise. The proposed removal of the SAP requirement would
subject buoys installed for OSW purposes to all of the USACE
requirements that currently apply to buoys installed on the OCS for any
other purpose. It should also be noted that BOEM prepares an EA prior
to lease issuance where impacts resulting from site characterization
and site assessment activities are discussed and presented to the
public for public comment and consideration before finalizing the EA.
The final rule will not change this practice.
Comment: Several commenters expressed concern regarding delegation
of review to USACE. A commenter inquired about how BOEM will work with
USACE to ensure that OSW data buoys are properly permitted and noticed
to mariners and how BOEM will ensure stakeholders are informed about
OSW leases in a single location. Another commenter noted the SAP
process was more transparent to the public regarding the components of
a lease area survey and equipment that will be used.
Response: Stakeholder and public input is channeled through the
NEPA review rather than through the review of an individual SAP. The
proposed rule does not reduce or eliminate BOEM's environmental review
of site characterization and site assessment activities (geotechnical
and geophysical surveys, site assessment, and deployment of met buoys
and/or met towers). This review occurs during BOEM's development of an
EA which typically concludes with the release of a Final EA and a
Finding of No Significant Impact during the period between the issuance
of a PSN and an FSN. These EAs analyze all anticipated environmental
impacts of activities expected to take place following lease issuance,
including site characterization and site assessment activities.
Comment: A commenter expressed opposition to the proposal to
eliminate the SAP requirements for met buoys stating that further
segmentation of the project review process will make stakeholder
participation and awareness more burdensome than it already is.
Response: Stakeholder and public input is channeled through the
leasing EA rather than through the review of an individual SAP. The
rule does not reduce or eliminate BOEM's environmental review of site
characterization and site assessment activities (geotechnical and
geophysical surveys, site assessment, and deployment of met buoys and/
or met towers). This review is completed during BOEM's development of
an EA under NEPA which typically concludes with the release of a Final
EA and a Finding of No Significant between the issuance of a PSN and an
FSN. BOEM's leasing EAs analyze all anticipated impacts from site
characterization and site assessment activities, including the
deployment of met buoys and, in some cases, towers.
Comment: A commenter stated that permits for lease SAP approvals of
met buoys by the USACE must include decommissioning requirements and
BOEM must guarantee the continuity of OSW decommissioning processes so
that commercial fishing industry is ``not left with a cluttered benthic
habitat without any Federal agency responsible for removal of
structures within the Exclusive Economic Zone.''
Response: USACE may incorporate its own decommissioning
requirements in permit approvals of met buoys. For example, USACE NWP 5
requires that ``upon completion of the use of the device to measure and
record scientific data, the measuring device [i.e., met buoy] and any
other structures or fills associated with that device (e.g.,
foundations, anchors, buoys, lines, etc.) must be removed to the
maximum extent practicable and the site restored to pre-construction
elevations.'' However, USACE decommissioning requirements are dependent
on the type of permit used and subject to district review and
discretion. Overall, USACE decommissioning requirements, coupled with
the final rule's provision in 30 CFR 285.900(c) reserving to BSEE the
authority to require decommissioning in the event that USACE does not
require it and the relatively low number of met buoys should ensure
that the Exclusive Economic Zone will not result in the ``cluttered
benthic habitat'' that the commenter is concerned about. Overall, BSEE
expects to utilize its regulatory authority for decommissioning of
buoys in limited circumstances.
Comment: A commenter stated that if a met tower or met buoy is part
of the BOEM OSW leasing process, BOEM should conduct the permitting.
Response: BOEM's leases do not authorize deployment of met buoys
and grant the lessee only the exclusive right to submit plans for
BOEM's approval. BOEM analyzes the impacts of deploying buoys at the
lease sale stage because this activity is expected to take place
following lease issuance. In this regard, following publication of the
final rule, the deployment of met buoys will be considered in the same
fashion as other reasonably foreseeable activities, the impacts of
which are analyzed in BOEM's NEPA documents and consultations but
require no direct authorization from BOEM (e.g., the use of port
facilities and vessels). BOEM will concentrate on permitting more
complex facilities and remove the unnecessary overlap in permitting
requirements that was in place for met buoys.
Comment: One commenter noted that under Sec. 585.600(a)(1), SAPs
would be required only for site assessment activities involving an
engineered foundation and that off-lease and on-lease site assessment
activities for facilities without foundations would be authorized under
USACE permitting requirements under section 10 of the Rivers and
Harbors Act. The commenter stated that USACE NWPs are subject to
regional conditions and are not used in all offshore areas and that
this region-specific difference should be noted in the final rule.
Response: The commenter is correct that USACE permits may be
subject to regional conditions, and the requirements for deploying a
buoy may vary regionally. However, BOEM's regulations are not the
appropriate vehicle for providing guidance applicable to permits issued
by other agencies.
Comment: Regarding SAPs submitted before lease issuance being
subject to Federal consistency reviews under 15 CFR part 930, subpart D
(not subpart E), and noncompetitive lease sales reviewed under 15 CFR
part 930, subpart D (not subpart C), two commenters suggested BOEM
clarify language at Sec. 585.612 to account for these scenarios.
[[Page 42609]]
Response: BOEM has considered the commenter's suggestions and notes
that such clarifying language has already been proposed. Proposed
revisions to Sec. 585.612(a) clarify that an SAP submitted before
lease issuance would be subject to 15 CFR part 930, subpart D.
Likewise, proposed revisions to Sec. 585.231(f) clarify that a
noncompetitive lease is subject to 15 CFR part 930, subpart D. Although
BOEM appreciates suggestions that may provide more clarity, the
suggested revisions to include clarifying language on noncompetitive
leases at Sec. 585.612 would be duplicative of the language that is
already provided at Sec. 585.231(f), which is similar to BOEM's
requirements for offshore oil and gas and marine minerals activities.
BOEM cannot hold an OSW lease auction (Federal action, under 15 CFR
part 930, subpart C), nor permit activities (federally permitted
activities or plans, 15 CFR part 930, subparts D and E), without
concurrence or presumed concurrence from the State coastal management
programs with reasonably foreseeable coastal effects or for which the
activities are within their geographic location description or have
been awarded a consistency review through the unlisted activity review
process from NOAA's Office of Coastal Management.
Comment: A commenter expressed opposition to BOEM's proposal to
change the SAP process to rely on USACE NWPs stating that, because of
regional differences in offshore areas, transferring permit authority
to the USACE may not streamline the process and may trigger additional
Federal Consistency Certification (FCC) review.
Response: BOEM is not transferring authority to USACE, as USACE
generally has regulatory authority over deployment of met buoys in OCS
areas. Any regional differences, as the commenter asserts, would exist
regardless of whether BOEM exercises additional jurisdiction over the
same buoys. The USACE permits scientific measurement devices used for a
variety of purposes deployed in U.S. navigable waters and on the OCS,
including met towers and met buoys. The USACE permitting process is
subject to the same Federal environmental laws applicable to BOEM's SAP
process. The USACE statutory authorities under section 404 of the CWA
and/or section 10 of the Rivers and Harbors Act of 1899 require
compliance with Federal environmental laws similar to BOEM's SAP
process.
As for BOEM, expected site characterization and site assessment
activities on the lease will continue to be analyzed as part of the
environmental review performed prior to a lease sale.
USACE currently issues approval of installation of buoys for
multiple purposes for which BOEM is not consulted and which are
unrelated to OSW. Current lessees need to perform met buoy deployment
and installation activities in compliance with USACE's NWP 5 or another
applicable general permit or individual permit. In addition, BOEM has
coordinated with USACE to ensure that the final rule addresses the
concerns raised by the commenter.
Comment: A commenter recommended that BOEM retain involvement in
the permitting process by the USACE and United States Coast Guard
(USCG) and retain involvement in geophysical and geotechnical site
characterization survey activities.
Response: BOEM would retain involvement in the permitting process
through its environmental review process. This review is completed
during BOEM's development of an EA under NEPA which typically concludes
with the release of a Final EA and a Finding of No Significant Impact
between the issuance of a PSN and an FSN (i.e., prior to lease
issuance). BOEM's EAs analyze environmental impacts of activities
expected to take place following lease issuance, including site
characterization and site assessment activities. Further, BOEM is not
proposing to alter its involvement in geophysical and geotechnical site
characterization survey activities. BOEM's OSW leases include
stipulations that require the submission of geological and geophysical
(G&G) survey plans for review by BOEM prior to the commencement of
survey activities. Moreover, BOEM's leasing EAs analyze potentially
significant impacts from G&G survey activities.
Comment: A commenter recommended that BOEM establish a clear
framework and mechanisms for interagency consultation prior to the
deployment of site assessment facilities with novel anchoring
technologies that do not have a BOEM-approved SAP.
Response: If a novel anchoring technology was proposed that was not
analyzed in the BOEM leasing EA, or if USACE determined that effects of
the novel anchoring technology had more than minimal adverse
environmental effects, additional environmental review would be needed,
and USACE may require an individual permit application. The types of
technology permitted without further environmental review would be
limited to those that are within the scope of the EA and any associated
consultations.
Comment: A commenter recommended the addition of language regarding
the mechanism for financial assurance regarding decommissioning if
USACE does not require site clearance ahead of site assessment
activities.
Response: BOEM would not hold decommissioning financial assurance
for facilities, like a met buoy, for which the agency did not issue an
approval. The lessee may have decommissioning obligations under its
USACE authorization, but BOEM would not hold financial assurance
guaranteeing that obligation. Although BOEM would not hold
decommissioning financial assurance directly related to the buoy,
BSEE's regulations still require that the buoy be decommissioned (30
CFR 285.902). BSEE expects to utilize its regulatory authority for
decommissioning of buoys in limited circumstances.
Comment: A commenter recommended deleting the definition of
``engineered foundation'' from Sec. 585.600(a)(1) to ``avoid
confusion, given that it only applies to met towers and no other
structures.''
Response: BOEM agrees with this approach given that the term
``engineered foundation'' was intended to be used only in the SAP
provisions of the rule. Therefore, this definition has been deleted in
the final rule (Sec. 585.113) and Sec. 585.600(a)(1) is revised
accordingly.
Comment: A commenter suggested the following revisions to BOEM's
proposed language in Sec. 585.600(a)(1), which provides that SAPs
would be required only for site assessment activities involving an
engineered foundation:
Before you:
Conduct any site assessment activities on your commercial lease,
involving [delete: an engineered foundation, such as] meteorological
towers or other facilities that are installed [add: on the seabed]
using a fixed-bottom foundation requiring professional engineering
design and assessment of sediment, meteorological, and oceanographic
condition [add: as part of the design].
You must submit, and obtain approval [strikethrough: for] of, your
SAP [strikethrough: according to] under Sec. Sec. 585.605 through
585.613.
Response: BOEM agrees in part with the commenter and is revising
Sec. 585.600(a)(1) to provide that:
Before you:
Conduct any site assessment activities on your commercial lease,
involving meteorological towers or other facilities that are installed
on the seabed using a fixed- bottom foundation requiring professional
engineering design and assessment of sediment, meteorological,
[[Page 42610]]
and oceanographic condition as part of the design.
You must submit, and obtain approval for your:
SAP under Sec. Sec. 585.605 through 585.613.
Comment: A commenter asked BOEM to consider if the definition of
``engineered foundation'' (``means any structure installed on the
seabed using a fixed-bottom foundation constructed according to a
professional engineering design (based on an assessment of relevant
sedimentary, meteorological, and oceanographic conditions))'' should be
modified to apply to all substructures whether fixed or floating. A
commenter raised concerns that changes to deployment requirements for
meteorological buoys should be reconsidered, reasoning that such
changes would limit environmental review, data collection, siting, and
buoy removal efforts.
Response: Met buoys have minimal environmental impact and SAPs are
not submitted for public review. All structures, including met buoys
and their mooring and anchors, are still required to be decommissioned
with the seabed cleared. SAPs may be used for other purposes such as
testing new technologies, so the standard in Sec. 585.600(a) applies
to more than met towers. Met buoys with more complex foundations such
as piles or suction buckets will still require an SAP if they are
``installed on the seabed using a fixed-bottom foundation requiring
professional engineering design and assessment of sediment,
meteorological, and oceanographic conditions as part of the design.''
(b) Off-lease met buoys.
Comment: A couple of commenters opposed BOEM's proposal related to
off-lease site assessments due to potential impacts to the environment
and fisheries. A commenter wrote that disassociating met towers and
buoys from leases would lead to more deployment of the devices,
creating additional hazards for mariners as navigable waters are
already decreased by wind farms. The commenter asked how fishermen
would be impacted from a posited increased in the number of buoys and
towers.
Response: BOEM does not believe that the marginal change in
regulatory approach BOEM has proposed will lead to an appreciable
increase in the number of buoys and other devices deployed--either on-
lease or off-lease. Lessees are not likely to deploy any more
meteorological buoys than are reasonably necessary to collect the data
needed to support a project due to logistical and economic constraints.
BOEM will continue to evaluate the effects of such deployments under
NEPA analyses of reasonably foreseeable outcomes of the issuance of OSW
leases. Moreover, the deployment of these devices would be subject to
existing regulations with which other sectors of the economy engaged in
oceanographic research must comply.
Comment: A commenter called BOEM's proposal arbitrary and
capricious, stating that BOEM's rationale for eliminating review for
off-lease met buoys/towers contradicts its reasoning for continuing to
require SAPs for on-lease met towers.
Response: BOEM will no longer require SAPs for the deployment of
standard buoys and off-lease met towers. However, BOEM will retain the
requirement for on-lease activities involving ``facilities that are
installed using a fixed-bottom foundation requiring professional
engineering design and assessment of sediment, meteorological, and
oceanographic conditions as part of the design.'' Likewise, BOEM
retains the SAP requirement for on-lease met towers, because their
potential impacts are expected to be more significant than a standard
met buoy. In both cases, BOEM is choosing to retain the SAP requirement
for on-lease activities that are more likely to cause impacts. This
division reflects the relatively tenuous nexus between an off-lease met
tower and offshore wind development and the sheer unlikelihood of
lessees installing and using such towers. BOEM has not processed a
limited lease request since the regulations were first promulgated in
2009.
Comment: Additionally, the same commenter stated that, ``BOEM's
primary rationale for such a change to regulations regarding off-lease
met buoys/towers is also irrational. On the one hand, BOEM states that
it intends to accomplish this change by stating that site assessment
activities do not produce or support energy generation. Yet its
rationale for making the change is to accelerate OSW development.''
Similarly, a commenter ``disagree[ed] with BOEM's finding that site
assessment activities do not produce, transport, or support the
generation of any energy project.'' Alternatively, a commenter agreed
with BOEM that no lease or other authorization is required, because
off-lease site assessment activities do not ``produce or support
production, transportation, storage, or transmission of energy from
sources other than oil or gas'' within the meaning of 43 U.S.C.
1337(p)(1)(C).
Response: These comments seem to suggest that BOEM must require
authorizations for any activities within its statutory jurisdiction.
However, it is neither irrational nor arbitrary for the agency to
choose to require an authorization for activities within its
jurisdiction that it finds more likely to be impactful, and to choose
not to require an authorization for activities within its jurisdiction
that it finds less likely to be impactful and that are permitted by
other Federal agencies in compliance with Federal statutes and
regulations. BOEM need not require leases for such buoys any more than
it needs to require a specific authorization for buoys deployed by a
BOEM lessee.
Comment: A commenter stated that under the proposal, BOEM would no
longer have the authority to deny a limited lease for off-lease met
towers. The commenter said that under the existing requirements,
developers must remain accountable to tribes and non-sovereign
stakeholders who have interests in environmental protection.
Response: BOEM agrees that, under the proposed and final rules, it
would no longer have the authority to deny a limited lease for off-
lease met towers, because BOEM would not require a limited lease for
such structures. However, the construction of a met tower on the OCS
will continue to be governed by a host of Federal regulations and
authorizations. In addition, environmental review under NEPA,
consultations under section 106 of the National Historic Preservation
Act (NHPA) and other authorities, as well as the need for tribal
government-to-government consultations remain in place. Such projects
would be subject to the same regulatory requirements as needed to
construct a met tower for any other purpose. In particular,
installation of a met tower on the Pacific OCS would be a very
significant undertaking, including opportunities for input,
participation and government-to-government consultations attendant
thereto.
Comment: A commenter urged BOEM to ``reconsider its proposed rule
determining that off-lease site assessment facilities do not require a
limited lease.'' Here, the commenter expressed disagreement with the
agency's finding that ``site assessment activities do not produce,
transport, or support the generation of any energy products.''
Referencing 88 FR 5968, 5976, the commenter asserted that site
assessment activities, including the operation of met buoys, support
generation of energy products. The commenter further asserted that BOEM
makes a similar finding with respect to met towers, stating that the
agency's ``decision not to seek to eliminate the
[[Page 42611]]
limited lease requirement for off-lease met-buoys is incongruous with
its proposal to eliminate the limited lease requirement for off-lease
met towers.''
Response: BOEM acknowledges that the existing approach treats on-
lease and off-lease activities differently in some cases. Historically,
BOEM required an authorization for on-lease buoys, but not off-lease
buoys. The final rule standardizes the approach by not requiring an
authorization for buoys in either case, subject to limited exceptions.
Because buoys are preferred over towers, BOEM expects this will result
in a consistent approach in the majority of situations--particularly on
the Pacific OCS where deeper water will favor the preference for met
buoys over towers even more strongly.
BOEM agrees with the commenter that site assessment activities like
buoys and towers may support the generation of electricity or other
energy product, and Sec. 585.104 is revised accordingly. Historically,
BOEM would require an authorization for on-lease met towers, and off-
lease towers if their purpose was to support OSW. In practice, BOEM has
received very few proposals for an on-lease met tower, and no proposals
for off-lease met towers. Under the revised regulations, BOEM will
require an approved SAP for on-lease met towers, but not off-lease met
towers. BOEM believes that requiring an SAP for on-lease met towers is
justified because potential environmental impacts of met towers and
facilities with engineered foundations are both more variable and more
significant for certain marine resources. However, BOEM is not
requiring an SAP for off-lease met towers because the nexus between an
off-lease met tower and offshore wind is likely to be more attenuated
than an on-lease met tower. Also, BOEM estimates that such towers are
likely to be so uncommon as not to merit specific treatment under our
regulations.
Comment: A commenter requested clarification on the review process
and timeline for off-lease site assessment activities. The commenter
said that these activities, particularly met buoys, may have
significant impacts to features including natural hard bottoms and
artificial reefs. The commenter stated that State agencies must be
given sufficient opportunity to review activities due to potential
impacts on bat and bird migrations.
Response: USACE evaluates applications to install met buoys on a
case-by-case basis. An application for a USACE authorization would
require compliance with the same Federal environmental laws (e.g., the
Endangered Species Act) applicable to BOEM's SAPs; that compliance may
result in measures to avoid or minimize impacts to environmental
resources.
Comment: Multiple commenters discussed the limited opportunities
for State engagement and public participation if the proposal is
finalized. A commenter stated that BOEM should clarify how off-lease
site assessment facilities will be managed where USACE's NWPs are
suspended due to regional conditions. The commenter also recommended
that BOEM provide a grace period prior to implementation to align with
State and USACE permit renewals and provide time for states to
coordinate procedural matters with USACE districts.
Response: Under the current regulatory regime for the OCS, off-
lease site assessment activities may occur without BOEM approval and
with USACE authorization (under either a nationwide, regional or
general permit) unless the purpose of the activities is to collect data
for renewable energy, in which case BOEM makes a case-by-case
determination as to whether a lease and GAP would be required. Given
that this distinction is only about the purpose of the data collection,
rather than the type of activities or their potential impacts, BOEM
cannot justify the higher burdens placed solely on those interested in
site assessment data to inform renewable energy. This suggests BOEM
should either require an SAP for all buoys, regardless of the purpose
for which they are proposed, or none. However, because OCSLA would not
permit BOEM to regulate buoys installed regardless of purpose (and
because there is another agency with precisely that mandate), we have
opted not to regulate buoys. Further, BOEM disagrees that the proposal
will result in limited opportunities for State and public participation
in BOEM's process, as a large number of public engagement opportunities
remain \10\ and will continue under the final rule. BOEM coordinates
extensively with states and consults with State authorities through
BOEM's Intergovernmental Task Forces and through regular ad hoc
meetings. Opportunities for public engagement are likewise plentiful;
BOEM typically holds dozens of meetings with different stakeholder
groups, both virtual and in-person, as well as public comment
opportunities associated with the RFI, the Call, the draft Area
Identification, scoping for the lease sale Environmental Assessment,
PSN, and scoping for the project EIS. The Department coordinated the
finalization of this provision with USACE. Given that USACE has a well-
established permitting program and because the Department is providing
regulatory relief with this final rule, BOEM does not find a grace
period to be necessary. Applicants who wish to deploy off-lease site
assessment facilities to collect data for renewable energy can follow
the existing well-established USACE processes to obtain general or
individual permits, as appropriate. Where a general permit is not
available, the USACE district may evaluate activities under an
individual permit.
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\10\ See A Citizen's Guide to the Bureau of Ocean Energy
Management's Renewable Energy Authorization Process, Dec. 2016,
available at https://www.boem.gov/sites/default/files/renewable-energy-program/KW-CG-Broch.pdf.
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Comment: A commenter recommended the following revisions to the
rulemaking text:
Sec. [thinsp]585.611: Clarify that information about
sites that have religious or cultural significance to Tribes, including
viewsheds and traditional cultural landscapes and properties, must be
included with the information an applicant must submit with an SAP to
assist BOEM in complying with NEPA and other applicable laws.
Sec. [thinsp]585.617: Paragraph (e)(1) should be revised
to add ``culturally significant sites, including viewsheds and
traditional cultural landscapes and properties; or subsistence rights
of a federally-recognized Tribe.''
Sec. [thinsp]585.606: Paragraph (e) should be revised to
add ``culturally significant sites, including viewsheds and traditional
cultural landscapes and properties; or subsistence rights of a
federally recognized Tribe.''
Response: BOEM reviewed these requests for additions to BOEM's SAP,
COP, and GAP requirements, and determined that BOEM's regulations, as
amended in this final rule, will require this information to be
included in such plans. The regulations in 30 CFR 585.627 require
lessees to submit detailed information and analysis ``to assist BOEM in
complying with NEPA and other applicable laws.'' This includes
information about ``archaeological resources use, or historic property
use, Indigenous traditional cultural use, or use pertaining to treaty
and reserved rights with Native Americans or other Indigenous peoples,
including required information to conduct review of the [plan] under
the NHPA or other applicable laws or policies, including treaty and
reserved rights with Native Americans or other Indigenous peoples.''
We have not adopted the precise wording proposed in the comment,
but we believe the language, as revised, will achieve the same result.
[[Page 42612]]
3. What is the Department finalizing?
(a) Sec. 585.104 Do I need a BOEM lease or other authorization to
produce or support the production of electricity or other energy
product from a renewable energy resource on the OCS?
This rule finalizes that off-lease site assessment facilities would
not require a limited lease and the Department would not conduct any
case-by-case determinations regarding whether off-lease site assessment
activities require a lease. This applies to both met buoys and met
towers. This final rule does not adopt the language from the proposed
rule stating that, ``for purposes of this section, site assessment
activities are not considered to produce, transport, or support the
generation of any energy products; and, therefore, such activities do
not, by themselves, require a lease, easement or ROW.'' (88 FR 5992)
That language implied that such activities would not be covered under
BOEM's authority under OCSLA. While it is true that in this rule, BOEM
has excluded buoys from the description of activities for which an
approved SAP would be required, it would be an overstatement to say
that such activities do not support the generation of energy. Please
refer to Section V of this preamble for a detailed discussion on this
section.
(b) Sec. 585.113 Definitions.
BOEM is not including its proposed definition of ``engineered
foundation'' in the final rule because the definition was intended to
be used only in the SAP provisions of the rule. However, the final rule
retains the same standard (meteorological or other facilities that are
installed on the seabed using a fixed-bottom foundation requiring
professional engineering design and assessment of sediment,
meteorological, and oceanographic conditions as part of the design) in
30 CFR 585.600 for determining whether an SAP is needed for proposed
site assessment activities on a commercial lease.
(c) Sec. 585.600 What plans must I submit to BOEM before I conduct
activities on my lease or grant?
BOEM is finalizing this portion of the rule about site assessment
facilities as proposed in Sec. 585.600. BOEM concludes that its
previous SAP requirement was unreasonably burdensome and redundant with
some of USACE's permit process and, therefore, unnecessary. Under the
final rule, lessees would deploy a met buoy following the existing
well-established USACE processes to obtain a general or individual
permit, as appropriate. USACE permits may be subject to regional and
special conditions, and the requirements for deploying a buoy may vary
regionally. The USACE permitting authority stems from section 10 of the
RHA and section 404 of the Clean Water Act (CWA). Under these
authorities, the USACE renders decisions for certain offshore
activities affecting navigable waters.\11\ BOEM does not anticipate
gaps in Federal oversight of met buoys deployed for measuring renewable
energy resources will result from this rulemaking. Equivalent met buoys
and other scientific research buoys deployed for reasons unrelated to
BOEM's OCSLA authority are already deployed routinely under other
Federal authorities and programs, including NOAA's National Data Buoy
Center program. BOEM is retaining the SAP process for facilities
installed on a commercial lease using a fixed-bottom foundation
constructed according to a professional engineering design (based on an
assessment of relevant sedimentary, meteorological, and oceanographic
conditions), including met towers.
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\11\ Including the extension of the RHA to the limits of the
outer continental shelf by the Outer Continental Shelf Lands Act at
43 U.S.C. 1333(a)(1).
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(d) Sec. 285.900 Who must meet the decommissioning obligations in
this subpart?
BOEM coordinated extensively with the USACE to ensure adequate
regulatory coverage for met buoys on the OCS. For example, on
decommissioning, BOEM anticipates that met buoys permitted under USACE
authority will be subject to USACE decommissioning requirements, as
applicable. However, to provide a backstop, BSEE revised its
decommissioning regulations to ensure that if, in the event, USACE does
not impose decommissioning requirements on a met buoy, BSEE retains the
authority to require it to be safely decommissioned. BSEE expects to
utilize its regulatory authority for decommissioning of buoys in
limited circumstances.
B. Project Design Envelope
1. What did the Department propose?
(a) Sec. 585.112 Definitions.
BOEM proposed to add a definition for ``Project Design Envelope
(PDE)'' as part of its proposal to codify the use of a PDE throughout
the NPRM subpart F (Plans and Information Requirements). The NPRM
proposed to add language to include the use of a PDE, which includes a
range of design parameters and construction and operation activities.
The NPRM also proposed the addition of language to clarify the ability
of lessees and grantees to submit plans using a PDE. The use of a PDE
is a proven approach to provide lessees and grantees with flexibility
throughout the permitting process while still complying with NEPA and
other statutory and regulatory obligations.
(b) Sec. 585.610 What must I include in my SAP?
The NPRM proposed that SAP information may be provided using a PDE
with BOEM reserving the right ``to determine what range of values for
any given parameters are acceptable.''
(c) Sec. 585.626 What must I include in my COP?
The NPRM proposed that COP information may be provided using a PDE
with BOEM reserving the right ``to determine what range of values for
any given parameters are acceptable.''
(d) Sec. 585.645 What must I include in my GAP?
The NPRM proposed that GAP information may be provided using a PDE
with BOEM reserving the right ``to determine what range of values for
any given parameter are acceptable.''
2. What are the key public comments?
Comment: Some commenters asserted that the proposed PDE approach
does not provide enough detailed information for various stakeholders,
such as fishing communities, the public, or permitting and consulting
agencies, to provide meaningful evaluation of potential impacts and
conduct Federal consistency reviews.
A couple of commenters suggested that mitigation measures should be
defined and made clear in the PDE. A commenter said that stakeholders
cannot effectively comment on unclear mitigation measures, nor can the
effectiveness of such mitigation measures be evaluated.
A commenter stated that BOEM should be allowed to provide direction
and articulate preferences for products, mitigation approaches, and
installation methods included in the PDE. The commenter discussed the
need to examine the range of impacts that could occur within the PDE,
not just the maximum, to identify technologies and approaches that
provide benefits or lessen the impact of a project. The commenter
warned that a PDE approach may undermine meaningful public evaluation
of likely design parameters if there are other contractual obligations
in place to use a specific technology from States or other sources.
Response: BOEM's existing EIS analyses use several methods to
ensure sufficiently detailed information is provided to stakeholders
about the range of impacts that may occur from a project that uses a
PDE. For example, BOEM may develop comparisons between different
options within a PDE
[[Page 42613]]
as part of the reasonable range of alternatives analyzed in detail in a
COP EIS. This analysis of alternatives allows for comparison of impacts
across design options within the PDE (e.g., foundation type) that
inform the public about the trade-offs between different technologies.
Moreover, the maximum impact scenario is not necessarily the same for
every resource, thus, BOEM's EISs typically assess impacts from a
variety of designs, techniques, layouts, and cable routes within the
PDE.
Comment: One commenter voiced support for the proposal but
requested that BOEM remove the language in Sec. 585.626(a) that ``BOEM
reserves the right to determine what range of values for any given
parameter are acceptable.'' Another commenter stated that BOEM should
provide guidance on the range of parameters it is prepared to review
through the process rather than requiring multiple rounds of PDE
submissions to narrow the scope. The commenter suggested a new
interagency memorandum of understanding under which consulting agencies
align and prepare to complete their review processes and avoid
utilizing PDEs as a tool for crafting EIS analyses from a range of
component options.
Response: BOEM needs the authority to review and request revisions
to a PDE that is unreasonably broad or vague. For example, BOEM may
request a revision when the PDE is too broad to be effectively analyzed
by NEPA or consulted upon with another agency, or there is not enough
detail in the COP to ensure sufficient safety and technical feasibility
to support a COP approval. The PDE approach is considered necessary to
allow for rapidly changing technologies in OSW. BOEM can use updated
COP and PDE Guidelines to set recommended limits on the PDE.
3. What is the Department finalizing?
(a) Sec. 585.113 Definitions.
BOEM is finalizing the definition of PDE as proposed. The final
rule will clarify the process for lessees and other stakeholders by
explicitly integrating PDE principles into the regulatory text,
primarily by referencing ``ranges'' of design parameters or locations.
In this final rule, BOEM recognizes that a PDE should not be overly
broad to avoid not defining the project well enough for meaningful
analysis.
(b) Sec. 585.610 What must I include in my SAP?
BOEM is finalizing that SAP information may be provided using a PDE
with BOEM reserving the right ``to determine what range of values for
any given parameter are acceptable.''
(c) Sec. 585.626 What must I include in my COP?
BOEM is finalizing that COP information may be provided using a PDE
with BOEM reserving the right ``to determine what range of values for
any given parameter are acceptable.''
(d) Sec. 585.645 What must I include in my GAP?
BOEM is also finalizing that GAP information may be provided using
a PDE with BOEM reserving the right ``to determine what range of values
for any given parameter are acceptable.''
C. Geophysical and Geotechnical Surveys
1. What did the Department propose?
(a) Sec. 585.626 What must I include in my COP?
The NPRM proposed to provide more flexibility and clarify existing
flexibility in COP requirements. BOEM proposed to shift the
geotechnical survey and data collection requirements from the largely
prescriptive standards to performance-based standards. These
performance-based standards would give lessees the leeway to
demonstrate that their selected combination of geotechnical and
geophysical surveys would provide BOEM the data at the COP review stage
to determine whether the project as designed could be constructed
safely in the proposed range of locations. Lessees could then determine
their own balance between geotechnical and geophysical surveys at the
COP stage. Through a COP sufficiency determination, BOEM would still
ensure that the COP contains information sufficient to complete its
environmental review and required consultations.
BOEM proposed to allow the submission of geotechnical data for an
engineering assessment of the proposed turbine foundations with a
lessee's FDR in lieu of the results of in situ boring and sampling at
each foundation location in the COP.
The NPRM also proposed to grant the Department the flexibility to
allow a lessee to submit subsea archaeological surveys at the FDR stage
on a case-by-case basis, subject to terms and conditions of COP
approval.
The proposal put forward clarifications that the COP must still
have the information sufficient to define the baseline geological
conditions of the seabed and provide sufficient data to develop a
geologic model, assess geologic hazards, and determine the feasibility
of the proposed site. The proposal also stated that the vast majority
of the data that would be deferred to the FDR and Fabrication and
Installation Report (FIR) stage is used solely for engineering
purposes. If the COP needs to be modified as a result of information
gathered from the deferred surveys, the Department would require the
lessee to revise the COP under the regulations at Sec. 585.634. The
Department believed that the proposed changes introduced flexibilities
and would enhance the Department's (and lessees') ability to respond to
environmental and ocean-user concerns raised during its environmental
reviews by modifying the project design.
(b) Sec. 585.645(b) What must I include in my GAP?
The NPRM proposed similar changes to the General Activities Plan
(GAP) requirements for limited leases and grants to be consistent with
the proposed changes to COP data requirements. Specifically, the NPRM
proposed revisions of the geotechnical, shallow hazards and geological
survey information requirements in the GAP at Sec. 585.645(a).
(c) Solicitation of comments concerning a potential new permit
requirement for conducting geological and geophysical surveys for
renewable energy activities.
BOEM considered whether there was a need for a future rulemaking
intended to regulate surveys associated with OCS renewable energy
activities. To that effect, the proposed rule solicited comments on the
following questions:
What additional protections might be gained through rulemaking that
cannot be achieved by way of the lease stipulations?
Should BOEM establish a permit-based mechanism to regulate surveys?
And to what extent, if any, should that permit program differ from the
permit requirements of the oil and gas program and marine minerals
program?
Is there another mechanism that could aid in the confirmation of
any damage to fishing gear as well as the identification of responsible
parties for any such damage from survey activities?
To what extent should BOEM require additional public reporting and
notice of any anticipated OCS survey activities? Is there a greater
need for specific advance notice requirements to include the location,
dates, and times in which other OCS surveys will be conducted?
To what extent should BOEM identify and track OCS survey activities
related to renewable energy program activities?
How can BOEM improve the current procedures for reporting by and
reimbursement of any party that might be negatively impacted by the
activities in renewable energy survey activities? Can these
improvements replace the need to promulgate regulations
[[Page 42614]]
governing OCS surveys for renewable energy projects?
Should BOEM require advance coordination of survey activities with
other lessees operating on the OCS?
Are there other policies or requirements that BOEM should consider
to minimize the adverse interaction between those conducting surveys
and other users of the OCS?
2. What are the key public comments?
(a) COP data requirements.
Comment: Several commenters supported the proposed changes allowing
certain archeological data to be submitted with the FDR and indicated
this would save time and money by eliminating the need to collect more
data than is necessary due to uncertainties in design. One commenter
suggested that BOEM offer two submittals for developers to: (1) submit
archeological survey information at the COP stage and (2) provide other
survey information at a later date on a component-by-component basis.
However, another commenter opposed the flexibility for the completion
of archeological surveys. Several commenters argued that if
archeological resource surveys are allowed to be deferred, BOEM should
work to facilitate agreements or memoranda of understanding among
National Historic Preservation Act (NHPA) section 106 consulting
parties to establish strong communication and design mitigation
approaches.
Response: Based on comments received, BOEM will continue to require
archeological surveys and analyses to be conducted prior to the FDR/FIR
stage because sufficient geophysical data is necessary to assess
potential impacts from offshore wind activities on cultural resources
and the introduction of a case-by-case deferral of certain marine
archaeological surveys would have created uncertainty for all parties
participating in consultations conducted according to section 106 of
the NHPA.
Comment: Several commenters suggested that BOEM should set specific
regulatory timelines for the COP review process, including a 20-day
preliminary review, a matrix of the subject matter expert comments
within 45 days, and an updated FAST-41 dashboard for communication with
project developers. A commenter also recommended that developers should
be required to begin consultation with State programs as early as
possible, not just upon the issuance of the Draft EIS, and should be
required to include the results of this consultation to State coastal
programs, fisheries users, and other coastal and marine users, as part
of the COP.
Response: In August 2023, BOEM released final guidance, entitled
Information Needed for Issuance of a Notice of Intent (NOI) Under the
National Environmental Policy Act (NEPA) for a Construction and
Operations Plan (COP), which establishes a non-binding framework
similar to the regime proposed by the commenter. BOEM prefers to focus
on implementing the current guidance, with its inherent flexibilities,
adaptability, and exceptions, as opposed to issuing a formal, rigid
rulemaking to address these issues.
Comment: One commenter stated, ``BOEM proposes to clarify the
language of Sec. 585.627 concerning the information to be submitted
alongside the COP, not to satisfy OCSLA but to assist BOEM in complying
with other statutory responsibilities, including NEPA.'' The commenter
also found it notable that BOEM stated, ``[t]he non-geotechnical survey
data included in the COP submittal are more than adequate to assess
impacts to the human, marine, and coastal environment, to conduct
necessary statutory consultations, and to show technical feasibility of
all proposed foundation types.''
The commenter supported the proposed clarifications and further
recommended revising the regulation to focus the requirement on
information regarding the potential for significant impacts. They
stated that doing so would be consistent with NEPA and the NHPA, as
well as various species-protection statutes that require interagency
consultation. The commenter stated that tailoring the information to
the statutory need would assist both BOEM and the COP applicant to
manage their shared responsibilities for developing data and analyses.
Response: BOEM incorporated responsive edits into Sec. 585.627(a)
in the final rule because they more accurately mirror the text in the
NEPA statute and regulations, which focus on significant effects of a
Federal action. BOEM added the phrase ``(or the potential significance
of the effect is unknown)'' to fully reflect Sec. 106 of NEPA, as
amended by the Fiscal Responsibility Act of 2023. BOEM also added the
phrase ``or such information is otherwise required by another statute
or regulation'' to emphasize that some of the requirements in Sec.
585.627(a) are subject to additional authorities beyond NEPA, which may
require the submission of additional information. BOEM also made
parallel edits to the relevant SAP regulations at Sec. 585.611(b) and
the relevant GAP regulations at Sec. 585.646(a)-(b) because BOEM's
plan requirements have parallel structures regarding NEPA. To
illustrate the edits made, the regulatory text in the final rule for
Sec. 585.627(a) provides, in part, that your COP must contain detailed
information and analysis necessary to assist BOEM in complying with
NEPA and other applicable laws. Your COP must contain information about
those resources, conditions, and activities listed in the table in
paragraph (a) that your proposed activities may significantly affect,
or that may have a significant effect on your proposed activities
(including where the potential significance of the effect is unknown)
and must contain any other information required by law.
Comment: A commenter expressed support for the proposal to submit
some archaeological surveys with the FDR, stating that this would
reduce vessel time in the water and associated environmental impacts.
The commenter stated that the requirement to submit geotechnical
surveys at each foundation location at COP submittal is ``at best
unrealistic and premature and at worst wasteful and inefficient,''
because ``only some geotechnical survey[s] together with geophysical
and archaeological surveys are necessary to inform the public
environmental review process.'' Another commenter requested that BOEM
provide more detail about which surveys would be acceptable at the pre-
COP stage to avoid duplicative survey work.
Response: The final rule clarifies which surveys are acceptable at
the pre-COP stage and which surveys are acceptable at the FDR/FIR
stage. Specifically, in the final rule geophysical survey data is
required at each foundation and cable location in the COP to develop
the geologic model as well as for environmental reviews. In addition,
while the NPRM would have allowed deferral of some geophysical surveys,
BOEM declined to carry forward that proposal in the final rule.
Consistent with the proposed rule, under the final rule
geotechnical data at each foundation location can be deferred to FDR
for final foundation design provided the data submitted in the COP is
otherwise sufficient for evaluation of geologic hazards and foundation
feasibility. Final assessment of geohazards and feasibility may be
deferred to the FDR stage by the lessee, at which time this information
will also be subject to review and certification by the CVA.
Consequently, the current requirement to submit site-specific
geotechnical data at the COP stage under 30 CFR 585.626(a) is modified
by both agencies in this final rule. Consistent with the proposed rule,
BSEE
[[Page 42615]]
and BOEM are relocating review of this site-specific data from 30 CFR
585.626(a) to 30 CFR 285.700(b) and (c).
Comment: A commenter expressed disagreement with the note in the
proposed rule suggesting that delayed archaeological surveys could
lengthen the NHPA section 106 review process. The commenter asserted
that the proposed rule is in line with industry standards and suggested
that BOEM clarify in the final rule whether any supporting
documentation would be required to get a survey strategy approved under
the performance-based standard. The commenter also suggested that BOEM
clarify in the final rule that phased geotechnical identification
represents a reasonable and good faith effort under the NHPA and future
project-specific Memoranda of Agreement and Programmatic Agreements
should include stipulations related to post-review discoveries. The
commenter also recommended that BOEM match the cultural resources
survey requirement language for GAPs to the corresponding requirement
language for COPs.
Response: BOEM's NPRM Sec. 585.626(b)(3) stated that ``[o]n a
case-by-case basis and subject to terms and conditions of COP approval
per Sec. 585.628(f), BOEM may permit you to submit certain surveys of
the subsea portions of the area of potential effects with your FDR per
Sec. 585.701(a)(11).'' Upon further consideration of comments
received, particularly from federally recognized Tribes, BOEM is
eliminating this language. BOEM agrees that sufficient geophysical data
is necessary to assess potential impacts from offshore wind activities
on cultural resources and the introduction of a case-by-case deferral
of certain marine archaeological surveys could create uncertainty for
some parties participating in consultations conducted according to
section 106 of the NHPA. BSEE has removed the referenced regulatory
text in Sec. 585.701(a).
Comment: A commenter suggested developers be allowed to submit
geophysical data pertaining to inter-array cables (IACs) after the COP,
at the FDR/FIR Stage because the IAC layout is uncertain until the
turbine generators have been selected, and delaying submission would
allow for targeted collection of data.
Response: Developers may request a departure for submitting
geophysical survey data for IACs and BOEM will evaluate the request
based on the site-specific conditions and project details.
Comment: A commenter suggested BOEM establish a de minimus
threshold or more specific details for when project revisions after a
COP approval are needed as the current proposed text is broad. The
commenter further stated that COP revisions should not be required
unless the changes occur outside of the PDE. A commenter proposed
detailed regulatory text changes to several sections including
additional review actions BOEM may take in relation to a COP that
proposes to develop a lease in phases or segregate a lease, changes to
the activities that trigger a revision to the COP and the timeline for
approval, and the timing to commence operations on a commercial lease.
Response: While a de minimis threshold has not been specifically
added to Sec. 585.617, Sec. 585.634, or Sec. 585.655, as the
provision in the final rule reads, minor deviations from an approved
SAP, COP, or GAP should not require a plan revision. BOEM added a
reference to the PDE as relevant to a determination of whether a
revision is required. BOEM selectively adopted part of the
recommendation regarding phased development in Sec. 585.238 (which
appeared as Sec. 585.629 in the NPRM) by accepting the recommendation
regarding conditioned approvals that account for subsequent phased
development. BOEM protected its discretion by adding that it may take
other actions within its authority, but determined that the proposed
revision specifying that BOEM may ``bifurcate its pending review of a
Plan where a lease is segregated'' was potentially confusing.
(b) Other comments on policies or requirements BOEM should consider
related to geophysical or geotechnical surveys.
Comment: Several commenters expressed concern that proposed changes
to survey requirements may result in less information being available
at the earliest stages of leasing and permitting and would affect
consulting parties' review of proposed projects. One such commenter
recommended revising Sec. [thinsp]585.103(a)(4) by adding,
``culturally significant sites, including viewsheds and traditional
cultural landscapes and properties, and subsistence rights of a
federally-recognized Tribe'' at the end of the paragraph.
Response: The concerns expressed in this comment are noted and
well-received. BOEM will not, as proposed in the NPRM, modify existing
requirements for geophysical survey results to be submitted with the
COP. Consistent with the proposed rule, the final rule permits deferred
submittal of site-specific deep borings from geotechnical surveys.
However, the geotechnical surveys that may be deferred are not
necessary to assess impacts to cultural or other environmental
resources.
Comment: A couple of commenters stated that industry should be
required to share geological and geophysical data from exploratory
surveys. A commenter discussed OCS sand resources for beach nourishment
projects and requested that BOEM balance lease issuance with non-energy
uses. The commenter expressed concern that BOEM's mandate to protect
sand resources is not given equal importance as its role in energy. The
commenter stated that internal and external agency coordination for
sand resources is needed to conduct a baseline assessment on sediment
resources. The commenter also requested that BOEM define ``competing
uses'' to include a phrase like ``such as offshore sand resources.''
Response: BOEM understands that the survey data generated by
offshore developers is of great interest to other communities,
including academic communities and those investigating other resources,
such as sand and mineral resources. Such issues must be weighed against
developers' justifiable business interest in keeping information
confidential that has been developed at great cost. BOEM agrees with
the importance of understanding the implications to all offshore
resources. The provisions of 30 CFR 585.626 and 585.627, and 585.645
and 585.646 (equivalent in COP and GAP frameworks) ensure that lessees
and ROW holders will evaluate and describe the implication to offshore
resources as part of plan preparation.
Comment: A commenter said that BOEM should consider requiring
compensation to the commercial fishing industry as mitigation for the
impacts of site investigations on vessels and gear. A commenter said
that BOEM should acknowledge that noise produced from survey equipment
may result in temporary decreased catch rates.
Response: BOEM is actively pursuing mechanisms to promote the
compensation of impacted fishers. BOEM is aware of potential impacts to
the fishing industry as a result of noise produced from survey
equipment. The agency has devoted significant resources to avoiding and
minimizing potential impacts and will continue to do so outside of the
current rulemaking process.
3. What is the Department finalizing?
(a) Sec. 585.626 What must I include in my COP?
BOEM is finalizing its proposal to allow submission of the results
of in situ
[[Page 42616]]
boring and sampling at each foundation location with a lessee's FDR, in
lieu of requiring that information to be included in the COP. To
effectively implement this rule, BOEM revised the recommended level of
geotechnical data required in the COP to match the scope described in
BOEM report 2018-054 by DNV.\12\ BOEM requires this level of data in
each COP to ensure there is sufficient data and analysis for evaluation
of geologic hazards and a foundation feasibility assessment.
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\12\ See https://www.boem.gov/sites/default/files/environmental-stewardship/Environmental-Studies/Renewable-Energy/Data-Gathering-Process.pdf.
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However, BOEM decided against allowing geophysical surveys to be
deferred on a case-by-case basis. With this final rule, BOEM will not
allow a lessee to submit the results of certain detailed subsea
archaeological surveys with the FDR. BOEM reasoned that sufficient
geophysical data is necessary to assess potential impacts from offshore
wind activities on cultural resources and the introduction of a case-
by-case deferral of certain marine archaeological surveys would create
uncertainty for all parties participating in consultations conducted
according to section 106 of the NHPA. Under the final rule, geophysical
survey data continues to be required in the COP to develop the geologic
model as well as for environmental reviews. BOEM also determined that
sufficient geophysical data is necessary to assess potential impacts
from offshore wind activities on cultural resources and the
introduction of a case-by-case deferral of certain marine
archaeological surveys creates uncertainty for all parties
participating in consultations conducted pursuant to section 106 of the
NHPA. Finally, BOEM considered concerns raised by federally recognized
Tribes who opposed deferring submittal of geophysical data to the FDR
stage.
(b) Sec. 585.645(b) What must I include in my GAP?
BOEM is finalizing its proposed revisions of the geotechnical,
shallow hazards and geological survey information requirements in the
GAP regulations at Sec. 585.645(a). To effectively implement this
rule, BOEM revised the recommended level of geotechnical data required
in the GAP to match the scope described in BOEM report 2018-054 by
DNV.\13\ BOEM requires this level of data in each GAP to ensure there
is sufficient data and analysis for evaluation of geologic hazards and
a foundation feasibility assessment.
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\13\ See https://www.boem.gov/sites/default/files/environmental-stewardship/Environmental-Studies/Renewable-Energy/Data-Gathering-Process.pdf.
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(c) Sec. 285.701 What must I include in my Facility Design Report?
BOEM is finalizing its proposed revisions that would defer the
submission of some geotechnical information, previously submitted as
part of the COP--or GAP for facilities deemed complex and significant--
to be submitted as part of the FDR under Sec. 285.701(a)(10).
D. 30 CFR part 285, subpart G, Certified Verification Agent and
Engineering Report
1. What did the Department propose?
(a) Sec. Sec. 285.700 through 285.710, 285.712, and 285.714
Improving the project design and fabrication/installation verification
process.
BOEM and BSEE concurrently review reports for design and
construction of the facilities on the OCS. Rather than relying solely
on agency engineering expertise, the agencies also require lessees to
use a CVA to provide independent third-party review of a project's FDR
and FIR. The NPRM addressed the CVA's integral role in determining that
a proposed OCS renewable energy facility is designed and constructed
safely using best engineering practices in accordance with Sec. Sec.
[thinsp]285.707 and 285.712. The CVA would also be expected to monitor
fabrication and installation activities and to submit a final report to
BOEM and BSEE, as applicable, before the start of commercial operations
or other approved activities in accordance with Sec. Sec.
[thinsp]285.637(a)(2) and (3) and 285.708-285.712.
Under the proposed rule Sec. 285.708(a)(2) and (b), the CVA would
be required to evaluate the commissioning of any Critical Safety
Systems and Equipment, such as equipment designed to prevent or reduce
major accidents that could result in harm to health, safety, or the
environment associated with facilities. The NPRM proposed to add
flexibility to the CVA nomination process. Currently, a lessee or a
grantee must submit its CVA nominations with its SAP, COP, or GAP. In
the NPRM, the Department would approve or disapprove CVA nominations as
part of its plan review. Multiple lessees have expressed a desire to
have an approved CVA in place before COP submittal so the CVA may
provide third-party review of design concepts in the COPs. This
reasoning also supports CVA review of SAPs and GAPs before submittal.
The Department has concluded that integrating CVA review into the
earliest stages of the design and permitting process is consistent with
its policy goals of encouraging safety and best engineering practices.
We also recognize that a lessee or a grantee may need to nominate new
CVAs as the project progresses (for instance, if a design parameter
changes at a later stage) or to request replacement of an approved CVA
if that CVA is ineffective or can no longer perform their duties. As a
result, the proposed rule would have provided flexibility for the
Department, lessees, and grantees by decoupling the CVA nomination and
approval process from plan submittal and approval. The proposed rule
also clarified that a lessee or a grantee could nominate separate CVAs
to review different components of a project.
A CVA provides independent third-party review of a project's
design, fabrication, and installation. The proposed rule would expand
the CVA's role to include verification of the design, fabrication, and
installation of the Critical Safety Systems and Equipment to assist the
Department in meeting requirements of OCSLA and its implementing
regulations to ensure that any authorized activities are carried out
safely. The Department's existing regulations require CVAs to
``certify'' projects, and the Department supports this approach as
applied to the FDR and FIR stages of wind power development.
2. What are the key public comments?
(a) Purpose, Role, and Scope of CVA.
Comment: Several commenters expressed disagreement with the
proposed changes to the CVA requirements, stating that the changes may
lead to a reduction in safety and recommending that the Department
carefully consider concerns about impacts to mariners. A commenter
stated opposition to the proposed waiver process for a CVA and use of a
lessee's engineer as they viewed the project engineer designation as a
lessening of responsibility and could produce conflicts of interest in
reviewing components. Another commenter opposed the use of multiple
CVAs for various components insofar as it could lead to inconsistencies
in the verification of a project. Finally, a commenter opposed the
changes in the ``verification'' and ``certification'' language,
suggesting that these changes would not be in line with industry
standards.
Response: CVA roles and responsibilities are now regulated by BSEE.
BSEE defines the role of the CVA in Sec. Sec. 285.707 and 285.708.
Changes to the rule on CVA roles and responsibilities will not reduce
the level
[[Page 42617]]
of safety on a project and will not reduce the safety of mariners or
other OCS users. The CVA must meet BSEE requirements for qualifications
and experience, and their scope of work will address safety concerns
through commissioning of the facility. Waiver requirements were already
included in the regulations. Any waiver of the CVA requirement will be
rigorously reviewed to ensure there is no reduction in safety prior to
accepting the use of a project engineer. The final rule adds stricter
requirements for project engineers when a waiver is requested. If
multiple CVAs are used on a project, BSEE will require one CVA to
oversee the entire facility design, fabrication, and installation and
to ensure continuity across all project components.
BSEE understands that the terms ``verification'' and
``certification'' are not consistently defined across published
standards. Accordingly, BSEE is defining each term based on the Oxford
Dictionary and contextual usage in relevant standards. The terms
``certify'' or ``certification'' describes how the CVA ``recognizes
that (someone or something) possesses certain qualifications or meets
certain standards.'' BSEE may thus require a CVA to ``certify'' that a
design or safety component conforms to a defined certification protocol
based on criteria from specific quality assurance standards or
recognized accepted engineering practices. The terms ``verify'' or
``verification'' describes how the CVA demonstrates that something is
true, accurate, or justified. BSEE has evaluated each of the CVAs
actions, as required by the regulations, and updated the regulations to
use the appropriate term.
Comment: Multiple commenters favored the proposed changes to CVA
requirements. Several commenters expressed support for the proposed
revisions to the role of a CVA, stating that the revisions align with
best engineering practices and BOEM and BSEE policy goals of
encouraging safety. One commenter stated support for the inclusion of
flexibility, pragmatism, durability, and performance-based standards
and suggested that the Department include a supporting discussion in
the preamble detailing the approach to these concepts. A commenter
expressed support for the CVA role revisions and the approval of CVA
nomination prior to COP submittal to create flexibility for both
lessees and the Department.
Response: BSEE has determined that reliance on CVAs will provide an
independent source of review for key stages of project development and
help to establish public confidence in the renewables industry. BSEE
defines the role of the CVA in Sec. Sec. 285.707 through 285.712. CVAs
play a role throughout the development of a project, including design,
fabrication, installation, and commissioning of Critical Safety Systems
and Equipment through verifications and certifications. The CVA
nomination now occurs within BSEE's oversight, therefore, the CVA
nomination has been decoupled from the COP. BSEE has taken a
performance-based approach and declined to incorporate new industry
standards in the regulations at this point in time as standards are
changing and still being developed, especially U.S.-specific standards.
The process implemented here provides flexibility regarding standard
selection but also provides BSEE the opportunity to review the
standards chosen by the lessee and CVA during the FDR review process.
Comment: Several commenters suggested changes that would enable the
Department to approve separate FDRs and FIRs for major project
components. The commenters stated that these changes would encourage
developers to seek CVA review throughout their project design process
and would permit the use of specialized CVAs to verify specific project
components.
Response: BSEE already allows and encourages separated FDR/FIR
submittals of integrated asset packages to allow for flexibility
pursuant to Sec. 285.700(b). BSEE has made rule changes related to the
role and responsibilities of the CVA for the purpose of advancing
overall levels of safety in Sec. Sec. 285.707 and 285.708. If multiple
CVAs are used on a facility, BSEE will still require one CVA to oversee
the entire facility design, fabrication, and installation and ensure
the compatibility of each facility component. All CVAs must meet BSEE
requirements for qualifications and experience during the nomination
process and BSEE will ensure the CVA scope of work addresses safety
concerns throughout the commissioning of the facility.
(b) Clarification of Rule Terminology.
Comment: A commenter requested that the Department clarify the
phrase ``all incidents'' that affect the design, fabrication, and
installation of the project and its components that the CVA is required
to report in Sec. 285.705. The commenter further requested that the
proposed rule change the burden of reporting incidents from the CVA to
the lessee, who has site control, and allow a CVA to verify any
modifications needed to address the incident. Another commenter
suggested that the Department change the definition for professional
engineers that are allowed to replace CVAs to ``licensed professional
engineer'' rather than ``registered,'' as it is the more common form in
the United States. A commenter suggested that the Department explicitly
define ``installation'' and ``commissioning'' in a similar manner to
the definition of ``fabrication'' and explain in more detail what is
included in the Critical Safety Systems and Equipment to better define
what is required to be verified by a CVA.
Response: The regulations at Sec. 285.705(a)(3) require the lessee
to use CVA(s) to immediately notify BSEE of incidents that affect the
design, fabrication, and installation of the project and its
components. The lessee is also responsible for reporting certain
incidents as required in Sec. Sec. 285.815 and 285.831, and the lessee
is responsible for accepting any fabrication or installation
modifications and notifying BSEE as provided in Sec. 285.703.
BSEE ensures that the lessee upholds its reporting requirements
(including the requirement to use a CVA to report certain incidents)
and can take enforcement action if the lessee fails to meet these
requirements. The use of the CVA for reporting incidents as a part of
their oversight responsibilities enables their participation in
evaluating such incidents and providing an independent analysis to BSEE
and is thus preferable to having the lessee solely report incidents.
``Incidents that affect the design, fabrication, and installation
of the project and its components'' is an intentionally broad phrase
that includes but is not limited to design changes or events that occur
prior to the final project verification report (PVR) that affect the
design, fabrication, or installation of the project or its components
such that the original design envelope, standards, or functionality has
been changed from what was originally reviewed. BSEE notes the rest of
the comments and may take them into consideration in the event that
BSEE initiates a relevant rulemaking process in the future.
(c) Scope and Role of CVAs and Project Engineers.
Comment: Several commenters provided feedback on the proposed
revisions to the role of a CVA in Sec. 285.705. Some commenters asked
that the Department specify the qualifications required of a ``project
engineer'' that is allowed to stand in for a CVA as it would assist
developers in determining if a waiver could be pursued.
[[Page 42618]]
Other commenters suggested adding language to indicate that the CVA
scope of work must be in accordance with project certification schemes
generally accepted and used in industry, such as International
Electrical Code Renewable Energy (IECRE) OD-502. A commenter also
requested that the Department clarify the responsibility of a General
Project CVA to avoid conflicts and misunderstandings that may result in
the incorrect completion or non-performance of verification tasks.
Another commenter suggested that the Department adopt an independent
process to review and approve a company's credentials for CVA
nomination rather than project-specific approach proposed by the
Department, to decouple CVA nomination from the project approval
processes and encourage new participants in the CVA market.
Response: A CVA must be both competent and independent. A proposed
waiver and substitution of project engineers for CVAs will be evaluated
by BSEE on a case-by-case basis. The lessee must submit the project
engineer's qualifications to BSEE as a part of their waiver request to
demonstrate that the project engineer is a professional engineer with
relevant experience and expertise in the facilities they will be
verifying/certifying. The waiver must demonstrate that the project
engineer is qualified to perform the requirements of Sec. Sec. 285.708
through 285.713. BSEE may evaluate this waiver requirement in future
rulemakings. BSEE disagrees with the commenters' suggestion to
incorporate any specific project certification standard, such as IECRE
OD-502. BSEE has taken a performance-based approach and declined to
incorporate new industry standards in the regulations at this point in
time as standards are changing and still being developed, especially
U.S.-specific standards. The process implemented here provides
flexibility while still allowing BSEE to evaluate the CVA scope of work
to ensure that it fully describes the CVA's verification and
certification approach.
When multiple CVA's are nominated for a project, a general project
CVA must be nominated to manage the overall project verification and
certification approach to ensure consistency and oversight among the
other CVAs, especially in transition areas between different CVAs.
BSEE disagrees with the commenters' suggestion to adopt an
independent process to review and approve a company's credentials for
CVA nomination because BSEE reviews each CVA nomination to make sure
that the nominated CVA has the technical expertise, experience, and
capacity for the specific project. A specific company may be an
acceptable CVA for one project and not another depending on the
technologies involved in the project, technical expertise of the
company, number of projects the company is overseeing, and several
other factors. BSEE will continue to review the CVA nomination for each
specific project.
(d) Monitoring and Witnessing of Project Stages by CVA.
Comment: A commenter provided specific regulatory text revisions
for Sec. Sec. 285.708 and 285.710 regarding when a CVA is needed on a
project and how to nominate a CVA for the Department's approval,
including a suggestion that CVAs may periodically monitor fabrication
and installation of a facility and utilize type-approved procedures
rather than ``proper'' procedures to verify a design.
A commenter requested additional guidance on how a CVA may verify
safety and suggested that a ``design-basis'' approach as described in
BOEM's 2020 COP Guidelines Attachment C could be applied.
A commenter stated that the ``Background'' section of the proposed
rule should be revised to reflect the current expectations for third-
party witnessing of certain commissioning activities, as recently
issued in a COP Approval Letter Terms and Conditions.
Another commenter stated that attending and witnessing of
commissioning activities of safety and protection functions by the CVA
is not necessary as these functions are already type-certified as part
of the IECRE-OD501 process. The commenter instead provided several
regulatory text revisions to Sec. 285.710 to recommend that
verification by a CVA be limited to a review of completeness of
commissioning records and systems and remove the requirement of a
review for type-certified components.
Response: As to the first comment described above, BSEE agrees that
the procedures used and validated during the type-approval process
should be used for type-approved components. For other components, OEM
procedures should be used when applicable as per Sec. 285.710. The
specific regulatory text recommendations were not all incorporated;
however, those recommendations were used to update the final regulatory
text.
In response to the second comment described above, BSEE is not
employing a ``design basis'' for the FDR and FIR. The CVA must certify
and/or verify the contents of the FDR and the FIR. The FDR contains
specific engineering and design information, including Critical Safety
Systems and Equipment. The FIR contains specific fabrication and
installation information. Project ``design bases'' tend to be broad and
less specific, and therefore not meet the criteria for an FDR or FIR.
CVA verification must address specific hazards identified via a risk
assessment and what mitigations (or design changes) were implemented to
minimize or alleviate the hazards.
As to the third comment described above, BSEE did not make changes
based on the comment, but BSEE did meet the intent of the comment in
the proposed and final rule by including requirements for commissioning
activities that are similar to those in the COP terms and conditions in
Sec. Sec. 285.705, 285.708, and 285.710. BSEE will also work with the
CVA to make sure expectations for commissioning are clear.
Finally, as to the fourth comment described above, BSEE disagrees
that there is no need for witnessing of the commissioning of Critical
Safety Systems and Equipment and has not implemented the proposed
revisions to Sec. 285.710. One of the roles of the CVA, as described
in Sec. 285.710, is to certify that engineering procedures are
executed as designed. BSEE has determined that periodic witnessing of
commissioning operations (inclusive of Critical Safety Systems and
Equipment commissioning) in addition to reviewing completeness records
is necessary to ensure conformance with submitted plans and that all
Critical Safety Systems and Equipment are functioning as intended and
installation is completed as designed.
Comment: Multiple commenters requested that the Department further
clarify the role of the CVA in verifying a facility's safety by
incorporating appropriate consideration for human and occupational
safety through verification of adherence to industry codes and
standards to reduce confusion regarding CVA review of a facility.
Response: BSEE has declined to incorporate new standards into these
regulations because BSEE has determined that the proposed processes
adequately account for human health and occupational safety. Human and
occupational safety must be considered during the risk assessments that
identify the Critical Safety Systems and Equipment as is required by
Sec. 285.701. The CVA will review the risk assessments and the
standards proposed as a part of the FDR and FIR for adequacy, will
certify adherence to the standards, and will certify that the risk
[[Page 42619]]
assessment outcomes have been integrated into the project design. BSEE
will review the risk assessment, FDR, FIR, and CVA submissions to
ensure that appropriate standards are being utilized.
Comment: A commenter stated that the removal of mooring and
anchoring systems from CVA verification presents an increase to risk
and safety of a project and requests that the Department reinstate the
requirement. The commenter also discussed the need for a CVA to verify
any self-inspection plans submitted for facilities in development.
Response: Mooring and anchoring systems have not been removed from
the CVA verification process. For floating facilities, the CVA or
project engineer must verify their structural integrity, stability,
ballast, and that proper procedures were used during, inter alia,
installation of the mooring and tethering systems described at Sec.
285.710(d)(3). For fixed bottom foundations for non-FOWTs, a CVA or
project engineer is required to inspect and verify mooring, tendon, and
tethering systems under Sec. 285.710(b)(6).
BSEE will be evaluating self-inspection plans throughout the life
of the project. The self-inspection plan includes an evaluation of the
Critical Safety Systems and Equipment identified and the associated
inspection criteria as well as the self-inspection criteria related to
structural, mooring, and monitoring of corrosion protection. Due to the
performance monitoring that BSEE will be conducting throughout the life
of the project, BSEE is best suited to perform this work as opposed to
a CVA.
(e) Other Comments.
Comment: A commenter suggested that the Department formalize the
Project Verification Report using a consistent term, ``PVR.'' The
commenter requested that the Department clarify whether some or all
Critical Safety Systems and Equipment are referenced in existing 30 CFR
585.710 and clarify that the periodic inspection referenced in proposed
30 CFR 585.710(a) is applicable to the entire scope described by
paragraph (b).
Response: The term ``PVR'' is defined as an abbreviation for
Project Verification Report in this preamble. BSEE has formalized the
minimum requirements of a Project Verification Report in Sec. 285.708.
BSEE understands that technologies will undergo frequent changes in a
new industry; accordingly, BSEE declines to provide a list of Critical
Safety Systems and Equipment which could limit future innovation. The
regulation requires that the lessee do a risk assessment of their
specific facilities and identify the Critical Safety Systems and
Equipment, with oversight from the CVA. The CVA's periodic inspections,
as referenced in 30 CFR 285.710(a), are applicable to the entire scope
of the CVA's oversight in 30 CFR 285.710(b), which includes Critical
Safety Systems and Equipment.
Comment: A commenter suggested that the proposed text does not
clearly state who will prepare the PVR at Sec. 585.704.
Response: BSEE agrees with the comment and has amended the
equivalent provisions in Sec. 285.708(a)(5) to designate a CVA to
prepare the PVR. BSEE realizes there may be multiple PVRs for a project
and has formalized the minimum requirements of a PVR in Sec.
285.708(a)(5).
Comment: A commenter stated that the ``Background'' section in the
NPRM (Section IV.B.6, 88 FR 5974) states that ``[t]he CVA must also use
good engineering judgment and practice in conducting independent
assessments of the commissioning of critical safety systems.'' However,
the commenter stated that this language is not included in existing 30
CFR part 585 (2011), although it can be found in recently issued COP
Approval Letter Terms and Conditions. The commenter urged the
Department to clarify ``witnessing'' requirements to be performed by
the CVA, as proposed in 30 CFR 585.705(b)(2). They suggested that the
Department revise the ``Background'' section of the rule preamble to
reflect the current expectations for 3rd-party witnessing of certain
commissioning activities.
Response: BSEE has revised Sec. 285.708 to clarify that the CVA's
primary duties for fabrication and installation are to: (1) use good
engineering judgment and practice in conducting an independent
assessment of the fabrication and installation activities and of the
commissioning of Critical Safety Systems and Equipment; (2) monitor the
fabrication and installation of the facility and the commissioning of
Critical Safety Systems and Equipment; (3) assess the facility design
to withstand the environmental and functional load conditions
appropriate for the intended service life at the proposed location; and
(4) certify in Project Verification Reports that project components are
fabricated and installed in accordance with accepted engineering
practices and to a nationally or internationally recognized quality
assurance standard or to an equivalent alternate means of quality
assurance considered on a case-by-case basis.
The regulatory text at Sec. 285.710(a) provides that ``the CVA or
project engineer must make periodic onsite inspections while
installation is in progress and must, as appropriate, verify, witness,
survey, or check the installation items required by this section.''
BSEE added another witnessing expectation for the CVA or project
engineer to make periodic onsite inspections to witness the
commissioning of Critical Safety Systems and Equipment at Sec.
285.710(f). Specific witnessing expectations may be included and
approved by BSEE as part of the CVA scope of work.
Comment: A commenter asked that the Department clarify the CVA's
duties for facility design review at Sec. 585.708 to include within
the usage of ``good engineering judgment and practices'' specific
language that the facility ``will withstand the environmental and
functional load conditions appropriate for the intended service life at
the proposed location and has been designed to provide for safety.''
Response: BSEE agrees with this comment in theory, but Sec.
285.708 contains requirements for fabrication and installation review.
BSEE has included language in Sec. 285.707(a) to require the CVA to
verify a facility is designed to withstand the environmental and
functional load conditions appropriate for the intended service life at
the proposed location and has been designed to minimize risk to
personnel as required by Sec. 285.105(a).
Comment: A commenter proposed to add a new section entitled ``What
must I include in my as-built submissions?'' with content as follows:
``(a) Your as-fabricated drawings and documents of any facilities that
are outlined in your FDR and FIR, must be made available to DOI prior
to PVR non-objection and must include the following items:
Required documents: (1) Complete set of cable drawing(s), Required
documents: (2) Electrical one-line drawing(s).''
Response: BSEE is considering publishing guidance regarding as-
built drawings and professional engineer stamping expectations but has
not made changes in this final rule as a result of these comments.
BSEE notes the rest of the comments and may take them into
consideration in the event that BSEE initiates a relevant rulemaking
process in the future.
3. What is the Department finalizing?
(a) Sec. 285.700 What reports must I submit to BSEE before
installing facilities described in my approved SAP, COP, or GAP?
The Department is finalizing the language in Sec. 285.700, as was
proposed Sec. 585.700, with clarifying revisions. In
[[Page 42620]]
final Sec. 285.700(a), BSEE requires that lessees submit an FDR and an
FIR before installing facilities described in the approved COP (Sec.
[thinsp]585.632(a)) and, when required by your SAP (Sec.
[thinsp]585.614(b)), or GAP (Sec. [thinsp]585.651). You may submit
your FDRs and FIRs to BSEE pursuant to revisions made to Sec. Sec.
285.700, 285.701, and 285.702 before or after SAP, COP, or GAP
approval.
As provided in final Sec. 285.700(b), if you submit separate FDRs
and FIRs by asset package (e.g., wind turbine generator (WTG), offshore
substation/electrical service platform, etc.), you must ensure major
integrated asset package(s) are complete (e.g., the WTG package
includes the rotor-nacelle assembly (RNA), blades, tower, foundation,
and transition piece, if applicable), and explain to BSEE how all asset
packages will function together effectively in an integrated manner in
accordance with your project design. You must also demonstrate that
such integration has been verified by your CVA.
Subject to these requirements, you may proceed with fabrication and
installation, under Sec. 285.700(d), when (1) BSEE deems your report
submitted before SAP, COP, or GAP approval and notifies you of its non-
objection to the FDR and FIR, or does not respond within 60 business
days of SAP, COP, or GAP approval; or (2) BSEE deems your report
submitted after SAP, COP, or GAP approval and notifies you of its non-
objection to the FDR and FIR or does not respond with objections within
60 business days of the report being deemed submitted.
The existing requirement to submit site-specific geotechnical data
at the COP stage under 30 CFR 585.626(a) is being modified by both
agencies. BSEE and BOEM are relocating review of this site-specific
data from 30 CFR 585.626(a) to 30 CFR 285.701(a). Within this
provision, BSEE is clarifying that the 60-day FDR and FIR review period
in the existing regulation is 60 business days. BSEE determined that a
60-business day review period, rather than the proposed 60-calendar day
review period, is necessary to ensure that BSEE has sufficient time to
review these complicated and lengthy technical documents.
Section 285.700(e) has also been revised to state that you may
commence procurement of discrete parts of the project that are
commercially available in standardized form and type-certified
components, or fabrication activities that do not take place on the OCS
(e.g., manufacturing), prior to the submittal of the FDR or FIR under
Sec. 285.700(a) or any plans required under 30 CFR parts 585 and 586.
The procurement and fabrication of facility components are subject to
verification and certification by your CVA, and BSEE may object to
their installation if the components or their fabrication are
inconsistent with accepted industry or engineering standards, the
approved SAP, COP, or GAP, the FDR or FIR, or BSEE's regulations.
Under final Sec. 285.700(f), if BSEE requires additional
information or has objections, we will notify you in writing within 60
business days of the FDR or FIR being deemed submitted for FDRs and
FIRs submitted after plan approval, or within 60 business days of plan
approval for FDRs and FIRs submitted before plan approval. Following
initial notification of any objections, BSEE may follow up with a
letter or email detailing its objections to the report and requesting
that certain actions be undertaken. Final paragraph (f) in this section
also states that you cannot commence fabrication or installation
activities on the OCS until you resolve all objections in such reports
to BSEE's satisfaction.
(b) Sec. 285.701 What must I include in my Facility Design Report?
The Department is finalizing the language in proposed Sec.
585.701, including revisions to Sec. 285.701(a)(1) through (10), the
addition of paragraphs (a)(11) through (13) and removal of paragraph
(e). In this section, BSEE addresses how the design report demonstrates
that the design conforms to key responsibilities listed in Sec.
285.105(a). In paragraph (a) of this section, the required documents in
the report include a cover letter; location plat; front, side, and plan
view drawings; structural drawings; summary of environmental data used
for design; summary of engineering design data; design calculations;
project-specific studies used in the facility design or installation;
description of the loads imposed on the facility; geotechnical reports;
design standards; Critical Safety Systems and Equipment; and other
information required by BSEE. BSEE is not finalizing proposed changes
to paragraph (b) and is keeping the provision in the existing
regulation with the exception of adding ``tendon'' to paragraph (b)(2).
BSEE is revising paragraph (c) to include what was proposed in
paragraph (b) that requires submission of the FDR to BSEE according to
Sec. 285.110. Under paragraph (d) of this section, if you are required
to use a CVA, the design report must include a certification statement
with accompanying justification attesting that the design of the
structure has been certified by a BSEE-approved CVA to be in accordance
with accepted engineering practices and the approved SAP, GAP, or COP,
as applicable, and has been designed to provide for safety. The
certification statement should also identify a location where the
certified design and as-built plans and specifications will be on file.
The Department proposed in the January 30, 2023, NPRM to change the
regulatory language defining the CVA's role from ``certify'' and
``certification'' to ``verify'' and ``verification'' in Sec.
285.701(d). The Department ultimately decided to maintain the use of
``certify'' and ``certification'' in this regulation. BSEE evaluated
each use of the words ``certify,'' ``certification,'' ``verify,'' and
``verification'' and updated the regulations as appropriate. In this
case, ``certify'' and ``certification'' are appropriate because the
terms describe how the CVA ``recognizes that (someone or something)
possesses certain qualifications or meets certain standards.'' The CVA
must, for example, ``certify'' that a design or safety component
conforms to a defined certification protocol based on criteria from
specific quality assurance standards or recognized accepted engineering
practices.
(c) Sec. 285.702 What must I include in my Fabrication and
Installation Report?
The Department is finalizing this regulation, consistent with
proposed Sec. 585.702. BSEE is revising Sec. 285.702(a)(1) through
(7); removing the existing paragraph (d); redesignating existing
paragraphs (b) and (c) as paragraphs (c) and (d), respectively; adding
paragraphs (a)(8) through (10) and (b); and revising the newly
redesignated paragraph (d). BSEE added new documents that must be
included in the fabrication and installation report, including quality
assurance information, which includes certificates ensuring adherence
to nationally or internationally recognized assurance standards;
commissioning procedures for Critical Safety Systems and Equipment,
including OEM procedures or other BSEE accepted engineering practices
for commissioning of Critical Safety Systems and Equipment as
identified in Sec. 285.701(a)(12); project easement; and other
information. A similar attestation to Sec. 285.701 must accompany the
filing of fabrication and installation reports. For purposes of quality
assurance, BSEE requires that certificates ensuring adherence to
nationally or internationally recognized standards be included in the
FIR, pursuant to Sec. 285.702(a)(6). Additionally, the NPRM proposed
to change the regulatory language defining the CVA's role from
``certify'' and
[[Page 42621]]
``certification'' to ``verify'' and ``verification'' in Sec.
285.702(d). The Department ultimately decided to maintain the use of
``certify'' and ``certification'' in this regulation. In this case, the
terms ``certify'' or ``certification'' are appropriate because they
describe how the CVA ``recognizes that (someone or something) possesses
certain qualifications or meets certain standards.'' BSEE may require a
CVA to ``certify'' that a design or safety component conforms to a
defined certification protocol based on criteria from specific quality
assurance standards or recognized accepted engineering practices. The
terms ``verify'' or ``verification'' describes how the CVA demonstrates
that something is true, accurate, or justified. BSEE has evaluated each
of the CVAs actions, as required by the regulations, and updated the
regulations to use the appropriate term.
(d) Sec. 285.703 What reports must I submit for project
modifications and repairs?
The Department is finalizing paragraphs (a) and (c) of Sec.
285.703, consistent with proposed Sec. 585.703. With respect to
repairs and modifications, BSEE revised the term ``major repair'' to
provide for substantial repair of a Critical Safety Systems or
Equipment, including those identified in your FDR. The term ``major
modification'' is revised to contain similar language of ``substantial
alteration'' of Critical Safety Systems and Equipment, including those
identified in your FDR. A similar attestation to Sec. 285.701 must
accompany the filing of repair and modification reports. CVAs will also
be required to ``certify'' that major repairs or modifications of
renewable energy structures and crucial components to a completed
project conform to accepted engineering practices, in the FDR and the
BOEM-approved plan, as applicable.
(e) Sec. 285.704 After receiving the FDR, FIR, or project
verification reports, what will BSEE do?
The Department is finalizing this regulation, consistent with
proposed Sec. 585.704, with revisions to Sec. 285.704(a), (b), and
(c). In this final rule, BSEE-administered rules for determining if
reports are ``deemed submitted'' or in need of correction for
``problems and deficiencies'' track similar BOEM-administered rules.
BSEE will have 20 business days to deem a report submitted or to notify
a lessee of problems or deficiencies that prevent BSEE from determining
that the reports are ``deemed submitted'' such as the submission being
incomplete or files being unopenable or corrupted.
(f) Sec. 285.705 When must I use a Certified Verification Agent
(CVA)?
The Department is finalizing paragraphs (a) through (d) of Sec.
285.705, consistent with proposed Sec. 585.705, with minor revisions.
This regulation has been updated to allow for multiple CVAs, if
approved by BSEE. The roles of the CVAs have been updated to add that
the CVAs must (1) ensure that the design of the facilities is suitable
for the location where they will be installed, (2) ensure Critical
Safety Systems and Equipment are commissioned in accordance with the
procedures identified in Sec. 285.702(a)(8), and (3) provide BSEE and
the lessee with reports of all incidents that affect the facility
design, fabrication, and installation, including the commissioning of
Critical Safety Systems and Equipment, for the project and its
components.
Waivers from CVA requirements must include a demonstration that the
facility design conforms to a standard design that has been used
successfully in a similar environment, the relevant fabricator has
successfully fabricated similar facilities, the installation company
has successfully installed similar facilities in a similar offshore
environment, and the facility will be fabricated or that major
modification or major repairs were completed in conformance with
accepted engineering practices and to a nationally or internationally
recognized quality assurance standard.
Finally, if BSEE waives the requirement for a CVA, lessees must
demonstrate that their project engineer can perform the same duties and
responsibilities as the CVA. The lessee must submit the project
engineer's qualifications to BSEE as part of their waiver request to
demonstrate that the project engineer is a professional engineer with
relevant experience and expertise in the facilities they will be
verifying/certifying.
(g) Sec. 285.706 How do I nominate a CVA for BSEE approval?
The Department is finalizing Sec. 285.706(b)(2) and (7), (c), and
(d), consistent with proposed Sec. 585.706. BSEE is removing Sec.
285.706(e) because the Reorganization Rule transferred authority for
approving a CVA from BOEM to BSEE. The final rule modifies proposed
paragraph (a) of this section to require that a CVA must be nominated
by the lessee and approved by BSEE before conducting any verification
activities for which they have been nominated. Under this revised
provision, if you intend to use multiple CVAs, you must nominate a
general project CVA who will manage the overall project verification
and certification approach and who will ensure consistency and
oversight among multiple CVAs. The general project CVA must be
nominated no later than the COP submission date. Paragraph (c) of this
section also includes conflict of interest provisions to ensure chosen
CVA(s) were not directly involved in the design, fabrication,
installation, modification, or repair for which they are asked to
provide an independent oversight.
Section 285.706 also requires that all verifications and
certifications must be conducted under the direct supervision of a
registered professional engineer.
(h) Sec. 285.707 What are the CVA's primary duties for facility
design review?
The Department is finalizing Sec. 285.707(a) and (b) consistent
with proposed Sec. 585.707 (a) and (b), with a few minor revisions.
BSEE has made minor changes to the description of CVA duties in final
Sec. 285.707(a) to require CVAs to verify to BSEE that the facility is
designed not only to withstand the environmental and functional load
conditions appropriate for the intended service life at the proposed
location, but also to minimize safety risk to personnel as required in
Sec. 285.105(a). Also, the regulation at paragraph (b)(9) is added to
provide that the CVA must conduct an assessment supporting the design
for human safety and how the results were used in the design. The
Department is not finalizing the proposed Sec. 285.707(c).
(i) Sec. 285.708 What are the CVA's or project engineer's primary
duties for fabrication and installation review?
The Department is finalizing Sec. 285.708, consistent with
proposed Sec. 585.708, with minor revisions. BSEE has updated
expectations for the CVA's oversight of fabrication and installation to
add in paragraph (a) that the CVA must 1) use good engineering
judgement and practice in conducting an independent assessment of the
fabrication and installation activities and of the commissioning of
Critical Safety Systems and Equipment, and 2) monitor the fabrication
and installation of the facility and the commissioning of Critical
Safety Systems and Equipment. Under paragraph (a)(5) in this section,
the CVA must certify in a project verification report that project
components are fabricated and installed in accordance with accepted
engineering practices and to a nationally or internationally recognized
quality assurance standard (or to an equivalent alternate means of
quality assurance considered on a case-by-case basis), the lessee's
BOEM-approved SAP, COP, or
[[Page 42622]]
GAP (as applicable), and the lessee's FIR. As provided in paragraph
(a)(5), the project verification report must also identify the location
of all records pertaining to facility fabrication and installation. In
paragraph (a)(6), the CVA must provide records documenting that
Critical Safety Systems and Equipment are commissioned in accordance
with the procedures identified in Sec. [thinsp]285.702(a)(8); and,
under paragraph (a)(7), identify the location of all records pertaining
to commissioning of Critical Safety Systems and Equipment, as required
in Sec. [thinsp]285.714(c).
Under paragraph (b), the CVA or project engineer must now also
monitor the fabrication and installation of the facility and the
commissioning of Critical Safety Systems and Equipment to certify that
they have been built and installed in accordance with the lessee's
FDR(s) and FIR(s). According to final paragraph (b)(1), the CVA or
project engineer must inform the lessee and BSEE if the fabrication and
installation procedures or Critical Safety Systems and Equipment
commissioning procedures have changed or design specifications have
been modified and, under paragraph (b)(2), if the lessee accepts the
modifications, the lessee must also inform BSEE.
(j) Sec. 285.709 When conducting onsite fabrication inspections,
what must the CVA or project engineer verify?
The Department is finalizing Sec. 285.709(a), consistent with
proposed Sec. 585.709 with minor edits. BSEE is not finalizing
paragraph (b) as proposed and is keeping the provision in the existing
regulation.
(k) Sec. 285.710 When conducting onsite installation inspections,
what must the CVA or project engineer do?
The Department is finalizing Sec. 285.710, consistent with
proposed Sec. 585.710. For inspections of installation activity on
floating facilities, BSEE is adding commissioning of Critical Safety
Systems and Equipment to the scope of work performed by a CVA or
project engineer in Sec. 285.710(b)(9). Content of their work will
include onsite inspections to verify, witness, survey, or check the
installation and commissioning of Critical Safety Systems and Equipment
to verify the equipment functions as designed and that all records
associated with commissioning of Critical Safety Systems and Equipment
are complete. The final rule expands the scope of CVA or project
engineer activity to verify that proper procedures are used for
commissioning of Critical Safety Systems and Equipment for both fixed
and floating facilities at Sec. 285.710(c). For floating facilities,
the CVA or project engineer must verify their structural integrity,
stability, ballast, and that proper procedures were used during (1)
loadout of the facility, (2) installation of foundation pilings,
templates, and anchoring systems, and (3) installation of the mooring,
tendon, and tethering systems as required by final Sec. 285.710(d).
The CVA or project engineer must also conduct an onsite inspection of
the installed facility as approved, as provided in final Sec.
285.710(e) and witness the commissioning of Critical Safety Systems and
Equipment, as provided in final Sec. 285.710(f).
(l) Sec. 285.712 What are the CVA's or project engineer's
reporting requirements?
The Department is finalizing Sec. 285.712, consistent with
proposed Sec. 585.712, with one edit. With this final rule, reports
prepared by a CVA or project engineer will summarize issues involving
the designs, and any incidents during facility fabrication and
installation or Critical Safety Systems and Equipment commissioning,
and how those issues were resolved, pursuant to Sec. 285.712(b)(5).
(m) Sec. 285.713 [RESERVED]
BSEE is removing and reserving this section, consistent with the
NPRM.
(n) Sec. 285.714(a)(4) What records relating to FDRs, FIRs, and
Project Modification and Repair Reports must I keep?
The Department is finalizing Sec. 285.714, consistent with
proposed Sec. 585.714. Additional recordkeeping measures are required
for the commissioning of Critical Safety Systems and Equipment and the
location of records identified in the certification statement, as set
out in Sec. Sec. [thinsp]285.701(c), 285.703(b), and 285.708(a)(5) and
(a)(7). These additional recordkeeping measures include providing BSEE
with the location of these records in the certification statements
associated with these regulations.
E. Renewable Energy Leasing Schedule
1. What did the Department propose?
(a) Sec. 585.150 What is the renewable energy leasing schedule?
BOEM proposed to include a new Sec. 585.150 describing the
renewable energy leasing schedule. This proposed schedule would include
a list of locations under consideration for leasing and a leasing
schedule that BOEM intends to follow in announcing its future renewable
energy lease sales. According to the proposal, at least once every two
years, the Secretary would publish a schedule of proposed lease sales.
As a proposed schedule, it would not obligate BOEM to offer all sales
on the schedule; BOEM would adjust the schedule as necessary through
the scheduled updates. The first published schedule would be issued for
the five-year period following the effective date of this rulemaking,
and subsequent schedules will cover the five-year period after each
update. This schedule would include a general description of the area
of each proposed lease sale, the calendar year in which each lease sale
is projected to occur, and the reasons for any changes made to the
previous schedule. Every time the schedule is updated, BOEM would
identify those lease sales that are being considered for the following
5-year period. For more details on the proposed renewable energy
leasing scheduled, see 88 FR 5984.
BOEM specifically solicited comment on ``its proposal to publish a
proposed Renewable Energy Leasing Schedule and what information should
be provided as part of this schedule.'' It also specifically solicited
comments ``on the content and the timing of the schedule updates, as
well as generally on how best to provide a schedule to improve
transparency of renewable energy development on the OCS.''
2. What are the key public comments?
Comment: Some commenters expressed opposition to BOEM's proposed
renewable energy leasing schedule. A commenter said that based on their
experience with the oil and gas 5-year program, the 5-year leasing
schedule would not be transparent, in the public interest, or
protective of the marine ecosystem and public health. The commenter
said the schedule would undermine due process and meaningful public
involvement. A commenter stated that a schedule by rulemaking would
give BOEM the authority to further curtail public engagement and
stakeholder input and avoid waiting for studies that could impact
decisions. The commenter recommended that BOEM establish the schedules
outside of the rulemaking process.
Response: The OSW leasing schedule in this rule should not be
confused with BOEM's National Outer Continental Shelf Oil and Gas
Leasing Program, which is different in many ways. BOEM does not agree
that including in our discretionary decision-making process a
requirement for greater public transparency about the agency's leasing
intentions could undermine due process or meaningful public
involvement, as the commenter asserts. The regular dissemination of a
schedule indicating
[[Page 42623]]
areas where the agency intends to focus future area identification
efforts will not affect the actual process that BOEM employs to
evaluate potentially suitable areas for leasing.
While we commit in this rulemaking to periodically publishing an
OSW leasing schedule, that aspirational schedule is independent from
BOEM's area identification and leasing process. The schedule will
simply summarize the agency's future plans for the consideration of
areas for leasing. For leasing scheduled in the first year or two of
the five-year period, BOEM may have completed some of the milestones
toward leasing development (area identification, sale notices, etc.).
For leasing scheduled later in the five-year period, BOEM may not have
completed or even begun such steps.
Comment: A commenter expressed support for additional requirements
associated with stakeholder engagement and government coordination. A
couple of commenters said BOEM should consider allowing public input
when changes are made to the schedule. A commenter expressed concern
that the proposed rule would not include a requirement for public
engagement or comment periods on the leasing schedule, stating that
public engagement should be required. Similarly, a few commenters
recommended that in creating a schedule, BOEM should lay out a
comprehensive process for engagement that would also vet alternatives
and promote the most appropriate areas for development of OSW.
Response: BOEM has not included a requirement for a comment period
prior to publishing the leasing schedule every two years. The leasing
schedule is meant to shed light on the state of BOEM's current thinking
rather than being the culmination of a detailed decision-making
process. Note that areas identified in a leasing schedule will likely
not see actual development for at least another 10-15 years, during
which many comment periods, public meetings, consultations, government-
to-government consultations, meetings, publications, studies, plans and
other activities must take place. The leasing plan sits at the
beginning of this process and is intended merely to let the public know
where BOEM plans to focus its attention on the consideration of new
areas.
Comment: One commenter requested additional information regarding
how BOEM will integrate Tribal consultation with the development of the
schedule before it is released to the public. Another commenter
requested that Tribal consultation be triggered whenever there is a
change to the lease schedule.
Response: BOEM is committed to following the Department's policy on
Consultation with Indian Tribes and Alaska Native Claims Settlement Act
(ANCSA) Corporations and will consult with Tribes where there are
departmental actions that may have a substantial direct effect on a
Tribe(s) (512 DM4; 512 DM 6). BOEM declines to commit to public comment
periods to inform the leasing schedules introduced in this rule.
Comment: A commenter proposed revisions to the regulatory text at
Sec. 585.150 to ``ensure that the leasing schedule is focused on
relevant objectives, is realistically achievable, and fosters
transparency for all stakeholders.'' A few commenters said the text
should identify specific considerations to be reflected in the leasing
schedule, including State and Federal renewable energy goals and
mandates, renewable energy supply chain needs, comparative needs of
regional and national energy markets, and the intersection of energy
generation potential and commercial development interest.
Response: The items mentioned in the comment will almost certainly
be considered in creating the leasing schedule, however, BOEM is not
committing in this rulemaking to publishing a discussion of how
considerations were balanced to obtain the announced leasing schedule.
3. What is the Department finalizing?
(a) Sec. 585.150 What is the renewable energy leasing schedule?
The final rule creates a new subpart B comprised of Sec. 585.150
that establishes a leasing schedule, essentially as proposed in the
NPRM. The schedule is published at least every two years, which covers
the five-year period following the schedule's publication. The schedule
will describe a general description of the area covered by each
proposed lease sale, the calendar year in which it is projected to
occur, and reasons for any changes to the previously published
schedule. BOEM did not add any mandatory comment periods or specific
outreach to the leasing schedule requirement.
F. Lease Issuance Procedures
BOEM proposed to revise several aspects of renewable energy auction
regulations in the NPRM. These revisions would provide simplification,
clarification, and conformance with existing agency practice.
1. What did the Department propose?
(a) Sec. 585.106 What happens if I fail to comply with this part?
BOEM proposed clarification to the process surrounding the
imposition of civil penalties.
(b) Sec. 585.210 What are the steps in BOEM's competitive lease
award process?
BOEM proposed to reorganize, simplify, and clarify the regulatory
section Sec. 585.210 that detail the steps leading to an OCS renewable
energy auction.
(c) Sec. 585.213 What information is included in the PSN?
BOEM proposed to simplify and clarify the auction regulations by
replacing the currently enumerated auction formats, bid systems, and
bid variables with a more flexible process to better accommodate an
emerging industry while allowing for auctions to be customized based on
circumstances surrounding each individual auction.
Consistent with BOEM's existing practice, the proposed sale notice
(PSN) would propose the specific format and procedures for an upcoming
auction, and the public would have an opportunity to submit comments
that would inform BOEM's final decisions regarding format and
procedures.
(d) Sec. 585.214 What information is included in the FSN?
BOEM proposed to publish the final auction format and procedures in
the final sale notice (FSN). This would allow BOEM greater flexibility
to tailor each auction to fit the particular circumstances.
(e) Sec. 585.216 How are bidding credits awarded and used?
As discussed in the NPRM preamble at 88 FR 5985, BOEM proposed to
continue to implement multiple factor auctions, through the use of
bidding credits, to allow the competitive lease award process to take
into consideration various priorities, such as advancing a domestic
supply chain or requiring workforce development agreements, relating to
orderly development of OCS renewable energy resources. The proposal
clarified that a bidder may be eligible for bidding credits based on
actions the bidder has already undertaken or for commitments to future
actions. In addition, at 30 CFR 585.225(g), BOEM proposed that, in the
event that a lessee does not meet the commitments it made to obtain any
bidding credits, the lessee would be required to repay the value of the
bidding credits that it received plus interest. BOEM would also reserve
the right to impose civil penalties pursuant to the provisions of
subpart N of 30 CFR
[[Page 42624]]
part 550 for failure to comply with the terms or provisions of a lease,
easement, or right-of-way. According to the provisions of the proposed
rule, a multiple factor auction could take one or more non-monetary
factors into consideration, including: (1) power purchase agreements
(PPAs); (2) eligibility for, or applicability of, renewable energy
credits or subsidies; (3) development agreements by a potential lessee
that would facilitate shared transmission solutions and grid
interconnection; (4) technical merit, timeliness, financing and
economics, environmental considerations, public benefits, or
compatibility with State and local needs; (5) agreements or commitments
by the developer that would facilitate OCS renewable energy development
or other OCSLA goals; or (6) any other factor or criteria to further
development of offshore renewable energy in a sustainable and
environmentally sound manner, as identified by BOEM in the PSN and FSN.
In the NPRM, BOEM solicited comments on the use of bidding credits and
multiple factor auctions as a method of advancing important priorities,
such as promoting workforce development or supply chain enhancement.
BOEM was specifically ``interested in obtaining comments on how bidding
credits or factors might be tailored to mitigate possible adverse,
project-related impacts. For example, BOEM was interested in receiving
comments on what impacts a project could have on underserved
communities and how bidding credits or multiple factor auctions can be
used to promote mechanisms such as community benefit agreements (CBA)
that could address those impacts and provide benefits to the
underserved communities. Comments on alternative means to achieve
public policy goals, such as through lease stipulations, are also
sought.''
(f) Sec. 585.222 Improper or Inappropriate Bidder Communications.
BOEM proposed to explicitly prohibit a bidder from disclosing its
auction strategies and economic valuations of a lease area to other
bidders in a particular auction in any manner that could prevent the
United States from obtaining a fair return on a prospective lease. The
proposal also outlined the rules applicable to all auctions and the
processes BOEM would use to disqualify a bidder that no longer meets
qualification requirements or who engages in specified improper
conduct. Additionally, it specified how a disqualified bidder might
seek to be re-qualified as a bidder.
(g) Sec. 585.224 What will BOEM do after the auction?
The proposal added a new term ``provisional winner'' to describe
the bidder that BOEM determines has submitted the winning bid at the
close of the auction, pending completion of the government's post-
auction reviews and the lease award reconsideration process. As
proposed, the provisional winner would become the winning bidder upon
favorable completion of these reviews and appeals. Additionally, as
discussed in the NPRM preamble (88 FR 5985), BOEM proposed to
consolidate the reconsideration and appeal provisions in Sec. 585.118
into a single section while retaining separate processes for seeking
the review of a decision, selecting a provisional winner, and for
appealing all other final decisions.
BOEM proposed to simplify and clarify post-auction procedures in
Sec. 585.224 by outlining what BOEM and a provisional winner must do
between the auction and lease execution. Additionally, the proposal
eliminated the term ``request for interest'' and proposed to replace it
with a broader term ``request for information'' (RFI). Finally, in
Sec. 585.225, BOEM proposed to change the due date for payment of the
first 12 months' rent to 45 calendar days after the winning bidder
receives a copy of the executed lease from BOEM.
(h) Sec. 585.225 What happens if BOEM accepts a bid?
Because the proposed rule would allow a provisional winner to
become a lessee before it has completed all obligations for which it
obtained bidding credits, an additional provision was proposed at Sec.
585.225(g), specifying that a lessee that has obtained bidding credits
for prospective performance obligations that were not fulfilled at the
time of the lease award, are subject to repayment in the event that
those performance obligations are not ultimately met prior to a
specified deadline or event.
(i) Sec. 585.226 What happens if the provisional winner fails to
meet its obligations?
As discussed in the preamble of the proposed rule (88 FR 5987),
BOEM proposed to define the term ``provisional winner'' and to outline
consequences if a provisional winner fails to sign the lease agreement,
provide the requisite amount of financial assurance, or tender the
outstanding bid balance. It included a list of actions that BOEM would
be authorized to take if a provisional winner fails to fulfill its
obligations.
(j) Sec. 585.438 What happens to leases or grants (or portions
thereof) that have been relinquished, contracted, or cancelled?
BOEM proposed language in the NPRM (88 FR 5996) that would provide
clear authority for BOEM to offer a lease to the next highest bidder if
a provisional winner of a lease auction fails to fulfill its
obligations before lease execution or is otherwise unable to execute a
lease. Similarly, BOEM proposed that if a lessee relinquishes its lease
or BOEM contracts or cancels a lease in whole or in part, BOEM could
re-offer the area previously covered by the lease.
2. What are the key public comments?
(a) Pre- and Post-Auction Procedures.
Comment: A commenter said that, in the area identification process,
BOEM does not explicitly consider the energy potential of the areas or
the current and future renewable energy goals of the proximate states.
Therefore, the commenter suggested that BOEM add a factor to the list
in Sec. 585.211(a) ``to indicate that the Call might include an
indicative power (MW) capacity of the given area(s) . . . informed by
Federal, State, and local clean energy goals, supply chain
considerations, and commercial interest.'' Additionally, the commenter
said the regulatory text should require the consideration of commercial
viability and prevention of waste during the area identification
process. The commenter provided revised regulatory text for Sec. Sec.
585.211 and 585.212 to reflect these suggestions. The commenter further
expressed support for:
``Simplification and clarity added to the lease process
regulations that make them both more readable and easier to follow;
Changes to Call and Area Identification procedures at 30
CFR 515.211 and 585.212 that clarify factors BOEM considers in
determining whether specific OCS areas are suitable for further
consideration for renewable energy development, including the area's
feasibility for development;
Consideration as to whether an area is technically and
economically viable for industry is critical to determining if an
auction should move forward;
Clarity provided related to the auction format that
provides BOEM with the flexibility to adjust its format as industry
evolves; and
Clarity regarding post auction procedures at 30 CFR
515.224.''
To further transparency, a commenter recommended providing more
information at the Call for Information and Nominations stage,
including the target capacity or acreage that may be
[[Page 42625]]
offered, and preliminary information on the auction format.
Response: BOEM does consider the goals and mandates of coastal
states adjacent to areas under consideration for OSW leasing in the
area identification process. For example, BOEM typically does not move
forward with leasing offshore of states that actively oppose OSW
development, and BOEM has offered multiple rounds of leasing in areas
with strong regional interest in OSW, such as southern New England and
the New York Bight. However, BOEM does not offer a specific leasing
``target'' in the area identification process because doing so would
require BOEM to pre-determine results and BOEM does not do that. BOEM
feels it is important to consistently convey to the public that the
decision-making process occurs through public outreach. Public outreach
is more than simply a process that BOEM must go through to get to
already-desired outcomes. It may be possible to establish a target--
informed by State objectives--in a way that makes clear that the
decision has not already been made to find a given amount of acreage,
whatever the consequences. However, the existence of such a target
could lead to an impression that, once formed, could be difficult to
rectify.
Comment: A commenter recommended revising paragraph (b)(2) of Sec.
[thinsp]585.211 to include ``archaeological and/or culturally
significant sites on the seabed or nearshore, including viewsheds and
traditional cultural landscapes and properties.'' The commenter said
this paragraph should also ``provide that BOEM request additional
socio-economic information such as potential impacts associated with
housing, Tribal revenues, worker's camps traditional gathering, first
foods, other disproportionate impacts felt by Tribal citizen members.''
Response: Section 585.211(b)(2) pertains to resources on which BOEM
requests comment in a Call for Information and Nominations, and states
that BOEM may request comments on ``archaeological sites on the seabed
or nearshore.'' The comment requests that BOEM specify that it may also
request information on ``culturally significant sites, including
viewsheds and traditional cultural landscapes and properties.''
Certainly, with or without the addition of this language,
commenters may submit such information. Indeed, BOEM's Calls for
Information and Nominations are open-ended and request whatever
information commenters care to share. Listing other regulatory
categories of information that BOEM may specifically request is
unlikely to result in the generation of more data.
As a practical matter, BOEM does request such information (and much
more) when it issues such Calls. For example, in the Call for the
Central Atlantic, published April 29, 2022, BOEM requested information
on ``known archaeological and cultural resource sites on the seabed,''
``the identification of historic properties or potential effects to
historic properties,'' ``visual resources and aesthetics, the potential
impacts of wind turbines and associated infrastructure to those
resources, and potential strategies to help mitigate or minimize any
visual effects,'' and ``other relevant socioeconomic, cultural,
biological, and environmental data and information.''
Comment: The commenter also recommended increasing the time between
the FSN and the auction to 60 days to strike a balance between an
efficient auction schedule and orderly development.
Response: As a practical matter, BOEM ordinarily schedules more
than the currently required 30 days between the FSN and the sale.
However, increasing the minimum time between the FSN and the sale would
eliminate BOEM's discretion to use a shorter waiting period and is not
likely to enhance orderly development. Typically, the PSN is published
several months before the FSN, and potential bidders are provided a 60-
day period to review and comment on the proposed terms and conditions
of the sale. By the time BOEM issues the FSN, the terms and conditions
of the sale are well known. There are circumstances where BOEM may need
to limit the time between the FSN and the sale, for example, to permit
scheduling flexibility related to holidays, the scheduling of other
lease sales, or other potential conflicts.
Comment: A commenter recommended amending Sec. 585.235(a)(4) so
the operations period does not begin until the commissioning of the
final power producing facility or power distribution system is
complete. The commenter said that commercial operations must be allowed
to begin as wind turbines are installed and commissioned, as is the
standard practice in the industry. The commenter recommended approving
commercial operations prior to installation of power producing
facilities based on the approved FDR/FIR, with the ability for BOEM/
BSEE to revoke permission for commercial operation if conditions are
not being met. Additionally, the commenter suggested providing lessees
the opportunity to remedy errors before permission for commercial
operations is revoked. The commenter reasoned that early commercial
operations provide economic benefits, including a cashflow balance
``for the lessee during the installation stage where substantial outlay
of capital is being made,'' early revenue that incentivizes early
installation, and safety benefits, including aerodynamic dampening that
counteracts hydrodynamic loading on the tower and foundation,
maintaining the structural fatigue lifetime of the structure.
Response: BOEM and BSEE considered many alternative ways to
structure the commercial operations issues identified in the NPRM,
including the one suggested in this comment. BOEM and BSEE agree that
assuming BSEE and the CVA are satisfied that the installation and
commissioning process is proceeding smoothly, turbines should be
permitted to run and generate electricity as part of the testing and
commissioning process. BOEM and BSEE, therefore, tied the commencement
of commercial operations with the submission of required information
under 30 CFR 285.637, including the ability to submit interim
documentation, to facilitate testing and continuous operations as
facilities reach first power. Under the revised Sec. 285.637, the CVA
may submit interim PVRs for subdivisions of a project's facilities
installed prior to commencing commercial operations. Assuming no
objections from BSEE, the lessee may begin commercial operations on
that portion of the lease and continue commercial operations on that
portion as other subdivisions of the project are brought online in the
same way. This is meant to accommodate industry norms for commissioning
projects safely and economically, while retaining BSEE oversight over
the entire process. With the revisions made to Sec. 285.637 in place,
BOEM and BSEE decided to keep ``commercial operations'' tied to the
``generation of electricity or other energy product for commercial use,
sale, transmission or distribution from a commercial lease.''
Comment: To provide clarity and predictability, a commenter
proposed revised text at Sec. [thinsp]585.628(c), eliminating the
stipulation that it applies only to post-lease submissions, and adding
explicit references to subparts D and E of the CZMA.
Response: BOEM has referenced both 15 CFR part 930, subparts D and
E, in the proposed rule under Sec. 585.627(b)(9). The provisions set
forth in 15 CFR part 930, subpart D are applicable to a COP that is
submitted prior to lease issuance
[[Page 42626]]
and the provisions of 15 CFR part 930, subpart E, are applicable to a
COP that is submitted after lease issuance. As noted in the CZMA
regulations, 15 CFR part 930, subpart D, requires the applicant/lessee
to submit all of the necessary data and information as well as the
consistency certification to both BOEM and the State's coastal
management program at the same time. In addition, as stated in proposed
Sec. 585.628(c), under 15 CFR part 930, subpart E, the applicant/
lessee would submit the necessary data and information as well as the
consistency certification directly to BOEM and BOEM will forward the
COP, consistency certification, and associated data and information to
the applicable State CZMA agencies.
Comment: A commenter expressed general support for the proposed
rule for re-offering leases at auction or when a lease area is
relinquished, contracted or canceled.
Response: BOEM is finalizing the referenced proposal re-offering
leases at auction or when a lease area is relinquished, contracted or
canceled.
(b) Auction Processes and Rules.
Comment: A commenter requested additional information on the
proposed changes to auctions. The commenter requested that more project
information be made available to the commenter, a Tribal Nation, as
early as possible, and recommended that BOEM build in clear triggers
for tribal consultation at every stage.
Response: BOEM currently works to make project information publicly
available as quickly as practicable. The comment did not specify what
project information BOEM should release sooner. The commenter's
location on the Pacific Coast suggests that it may believe that BOEM is
withholding project information related to California leases, but no
projects have been proposed on those leases and BOEM has no project
information in its possession. Regarding consultations, BOEM is
committed to honoring its Tribal consultation obligations. The
regulations require Tribal coordination and consultation with the
Tribal leadership for Tribes that may be affected by any leases,
easements, or ROWs BOEM may issue (Sec. 585.102(e)). This occurs
before the Call Area is identified, the earliest stage of the OSW lease
process. BOEM invites representatives of affected Tribes to
intergovernmental task forces, or other joint planning agreements. The
regulations also require Tribal consultation prior to the issuance of a
lease (Sec. 585.203), and during area identification prior to the
competitive issuance of leases (Sec. 585.211(b)). BOEM also consults
on a government-to-government basis at the request of any Tribe, and on
actions that have Tribal implications. We did not revise the
regulations to add triggers for consultations because this issue is
beyond the scope of the current rulemaking.
Comment: A commenter said BOEM needs to adopt a permanent supply
chain mechanism to reduce uncertainty and give companies the confidence
to invest in the domestic production supply chain, arguing that
inconsistent lease stipulations confuse market signals necessary to
spur investment.
Response: BOEM believes the Bureau can best support a domestic OSW
supply chain through predictable lease sale schedule and permitting
timeframes. The supply chain and workforce bidding credits and related
lease stipulations are not targeted or restricted to localized entities
but intended to incentivize domestic investments in the supply chain
and training. However, the comments did not suggest, and BOEM did not
adopt, regulatory changes in response to this comment.
Comment: A commenter encouraged BOEM to explicitly state a
preference for minimizing changes to bidding credits between the PSN
and the FSN.
Response: BOEM acknowledges the challenge that modifying bidding
credit provisions between the PSN and the FSN may be more time
consuming for companies preparing bids. However, BOEM also seeks to be
responsive to regional stakeholder interests and comments received
during regional Task Force meetings and the PSN comment period. This is
primarily a program implementation issue, and so it has not been
addressed in the current rulemaking.
(c) Multiple Factor Auctions and Bidding Credits.
Comment: A commenter requested that the final rule clarify that the
use of bidding credits in auctions must remain optional for
participating bidders. The commenter stated that mandating that bidders
accept the terms of bidding credits could reduce competitive interest.
Response: Bidding credits or other factors in a renewable energy
multi-factor auction have always been optional. The final rule remains
silent on the mandatory versus optional nature of bidding credit or
factors to provide future Department decisionmakers flexibility.
Comment: A commenter opposed the non-monetary factors listed in the
proposed Rule (30 CFR 585.216(b)(3)) due to the short auction period
and potential difficulty of being able to commit to shared
transmission. The commenter asserted that there is a need for criteria
for transmission-related credits and suggested that BOEM consider
alternative methods to promote shared transmission, such as conditions
of State procurement and non-binding lease stipulations that require
reasonable efforts to utilize shared transmission.
Response: BOEM appreciates the comments on bidding credits. The
list of bidding credits in Sec. 585.216(b) is intended to be
representative and not exhaustive. The decision of whether to use
bidding credits in a particular auction, and if so, which ones, is not
governed by the regulations. Accordingly, BOEM has not revised the
list, even though examples, such as the commenter has proposed, may be
possible to investigate further and include in a future lease sale.
Comment: A commenter asked for clarity in the final rule regarding
the number of proposed penalties in the event that a lessee fails to
comply with easement and right-of-way terms. A few commenters suggested
modifying the definition of ``bidding credit'' to include a financial
commitment attached to the bidding credits, for example, if a bidder
receives a bidding credit for a CBA, the bidder should be required to
expend a ``significant portion'' of the credit in funding those
agreements. Without recommending revisions to the definition of a
``bidding credit,'' a couple of commenters similarly recommended that
all future bidding credits contain a financial commitment requirement.
Response: BOEM has required an explicit financial commitment for
some bidding credits in renewable energy lease sales. Attachment of a
financial commitment to the definition of bidding credit would prohibit
some kinds of bidding credit that the agency may want to consider in
future auctions, like a bidding credit rewarding development experience
or innovative project design. BOEM has no current plans to use such
bidding credits, but the agency does not wish to constrain its
discretion to do so in the future. The design of any bidding credits
offered in a multi-factor auction is determined based on a balancing of
regional and national needs consistent with BOEM's authority under the
OCS Lands Act.
Comment: A commenter said the added flexibility for BOEM to
consider factors besides price in auctions has the potential for abuse.
A couple of commenters asked BOEM to clarify how factors and their
respective weights
[[Page 42627]]
would be determined, and how BOEM would assess whether the factors are
in accord with the goals of the OCS Lands Act.
Response: BOEM sets bidding credits in advance of each lease sale.
Bidding credits are designed to be consistent with the OCS Lands Act.
BOEM describes proposed bidding credits in the PSN, allowing for public
comment, and provides all the information about applicable bid credits
in the FSN prior to the lease sale. We do not agree that this final
rule adds additional flexibility to the non-price factors that BOEM may
use. BOEM had discretion under the previous regulations to hold
auctions that recognize non-monetary factors, and BOEM retains that
discretion in the final rule. In addition, the final rule more
accurately describes how BOEM intends to use non-price factors in
holding auctions. Accordingly, BOEM sees no potential for abuse in the
final rule.
Comment: Some commenters stated that bidding credits should not be
based on or require that actions be taken in advance, rather, they
should allow for identification of actions to be taken that are in
alignment with BOEM's goals. A commenter said that bidding credits for
actions a bidder has already taken would create unfair advantages and
reduce competitive interest. Additionally, the commenter said it would
reward past conduct, rather than incentivizing desired actions.
Response: The requirements for BOEM's bidding credits are outlined
in the specific FSN, lease, and Bidder's Financial Form Addendum. BOEM
designs multiple-factor bidding credits to maintain a level playing
field for all auction participants, but declines to address this issue
in the regulations.
Comment: A commenter expressed concern that two of the proposed
categories for bidding credits (power purchase agreements, and pre-
established renewable energy credit eligibility) could limit
competition and favor larger organizations with existing facilities.
The commenter expressed support for the BOEM's goal to facilitate
efficient development of OSW energy resources and encouraged BOEM to
continue seeking opportunities to improve the regulatory permitting
process, stating that the biggest gains in facilitating efficient
development of OSW energy resources may be made there as opposed to the
use of bidding credits.
Response: We appreciate the input regarding bidding credits for
power purchase agreements and pre-established renewable energy credit
eligibility. BOEM sets bidding credits for each sale in the FSN. BOEM
limits the bidding credit percentage, in part, to ensure the auction is
still efficient. Through this rulemaking and other initiatives, BOEM
seeks to improve its regulatory permitting process even as it evaluates
potential bidding credits.
Comment: A commenter expressed concern that it would be difficult
for BOEM to implement the proposed bidding credits in Sec.
585.216(b)(6) in a way that substantially benefits the public or
furthers development of OCS renewables because many of the proposed
credits are subject to uncertainty at the lease sale stage, which could
lead to vague promises from bidders and distort the market with
uncertain benefits to the public.
Response: BOEM designed the bidding credits it has used in recent
sales to include upfront commitments for investments, with follow-
through later in the lease term. This ability to refine planned
investments over time to what is most needed in the future should help
ensure that investments from the bidding credits are spent efficiently.
Comment: A commenter suggested expanding the workforce development
bidding credit program to allow for a bonus bidding credit if a
developer commits to both utilizing a PLA and employing a workforce in
which a significant majority of workers constructing and maintaining
wind farms are United States citizens or permanent residents. The
commenter also recommended extending the credit program to pre-existing
lessees by allowing developers to take a credit against future
operating fees, which would fulfill the Administration's goals of
``increasing the likelihood or pace of development.'' According to the
commenter, BOEM has authority to amend the regulation under 30 CFR
585.506 to establish such an operating fee credit under applicable
statutes and regulations, and it would be consistent with the IRA's
apprenticeship requirement for renewable energy facilities. Another
commenter also recommended revising Sec. 585.506 to clarify that BOEM
may award operating fee credits in future lease sales and existing
leases. The commenter provided revised regulatory text reflecting these
proposed changes.
Discussing the potential rewards for each credit in the recent
California and Gulf of Mexico lease sales, a commenter recommended that
future lease sales decrease disparities between bidding credits for the
fishing community and others.
Response: With regard to the workforce development and PLA bidding
credit, BOEM already has the ability to implement such a bidding credit
should it want to and no modification of the regulations is needed to
permit BOEM to use such a credit. Commenters requested that BOEM add
many examples to the representative list of bidding credits in Sec.
585.216(b). Adding additional representative examples neither expands
nor diminishes BOEM's bidding credit authority. BOEM has not added any
of the requested examples because to do so could beg the question why
other examples were excluded.
Regarding operating fee credits, although BOEM used such credits in
the New York Bight lease sale, it has not used them since them. BOEM
has not ruled out using them in the future and has tools necessary to
do so if desired. The revision requested in Sec. 585.506 would be
needed were BOEM to amend existing leases to conditionally reduce the
operating fee payments of existing lessees. This was not the purpose of
the rulemaking, and BOEM has no current plans to offer such amendments
to existing lessees. Accordingly, there is no need to revise the
regulations as recommended by the commenter.
Comment: Some commenters expressed opposition to a cap on bidding
credits because it would curtail public policy priorities (e.g.,
advancing a domestic supply chain), BOEM's stated goals of flexibility,
and it would narrow the OCSLA definition of ``fair return.'' A
commenter said the final rule should allow a bidder to pursue multiple
bidding credits at once, thus bidding credits should be capable of
stacking. Likewise, the commenter opposed an ``artificial cap'' on the
number of bidding credits a bidder can take, to ensure a fair return to
the United States. A commenter wrote that BOEM ``should allow for
stackable credits reflecting a bidder's commitment to provide workforce
training, supply chain development, fisheries compensatory mitigation,
and financial support for habitat and wildlife monitoring as eligible
bidding credits at Sec. 585.216(b).''
Response: BOEM sets bidding credits in advance of each lease sale
and designs credits to ensure they are consistent with the OCSLA. BOEM
has limited the non-monetary portion of its auctions to 25 percent of
the asking price in past lease sales. Limiting the bidding credits to a
percentage of the asking price promotes efficiency of the auction,
ensures a fair return to the Government for OSW leases, and is
consistent with Congress's intent to direct wind energy leasing
revenues to the General Fund while also allowing
[[Page 42628]]
BOEM to use monetary bidding incentives to further OCSLA goals.
However, nothing in the regulations imposes a specific limit on the
percentage credit, and no regulatory revision would be needed to use a
higher amount. Accordingly, no revision has been made.
(c)(i) How bidding credits or factors might be tailored to mitigate
possible adverse, project-related impacts.
Comment: A commenter said developers should adhere to standard
mitigation hierarchy by minimizing potential impacts prior to
mitigation considerations. The commenter encouraged BOEM to establish
lease stipulations and bidding credits to support activities including
workforce development, local job creation, energy access and
reliability, enhancing engagement and capacity building in communities,
sustainable development, circular economy methods, and fisheries
resiliency and/or compensatory mitigation.
Response: BOEM appreciates this comment and will strive to avoid or
minimize potential project impacts prior to considering mitigations. In
addition, BOEM will continue to seek additional avenues for
incentivizing accomplishment of worthy policy goals like those
enumerated. Lease stipulations and bidding credits are determined on a
case-by-case basis for specific lease sales, and not programmatically
through regulations. Since this comment does not request any revision
to BOEM's regulations, it is beyond the scope of the current
rulemaking.
Comment: A commenter recommended that BOEM add a credit to its non-
exclusive list in Sec. 585.216(b) for funding commitments for affected
ocean users. A commenter recommended BOEM allow bidders to earn up to
75% of cumulative credits for nonmonetary factors to ensure successful
development ``when a bidder can deliver, prior to the auction, a
minimum of three legally binding and enforceable agreements, each
earning up to 25% credit, with (1) local stakeholders, (2) fishing
industry group(s), (3) offtake agreement(s) with power purchasers and
placement in the interconnection queue with power regulators, and (4)
government agencies.'' The commenter outlined specific criteria and
listed a series of yes or no questions to determine if a developer is
eligible for each of the recommended agreements. A commenter
recommended increasing the proposed non-cash bidding credit cap to at
least 35%, stating that it would allow BOEM to manage the program in a
manner that considers the environmental value of renewable resources on
the OCS, potential impacts and benefits of renewable energy deployment,
and equitable sharing of risks and benefits among various regions.
Response: As the commenter noted, the list of non-monetary credits
in the final rule is included as representative of the credits that
BOEM may offer. BOEM will continue to consider bidding credits on a
case-by-case basis based on the particular conditions of each lease
sale.
As for the amount of bidding credits, BOEM has limited the non-
monetary portion of its auctions to 25 percent of the asking price in
past lease sales. Limiting the bidding credits to a percentage of the
asking price promotes efficiency of the auction, ensures a fair return
for OSW leases, and is consistent with Congress's intent to direct wind
energy leasing revenues to the General Fund while also allowing BOEM to
use monetary bidding incentives to further OCSLA goals.
Comment: A commenter suggested that BOEM codify mitigation
requirements in the final rule by incentivizing them through bidding
credits or some other mechanism to ensure developers properly engage
with ocean users, especially small businesses. Similarly, a commenter
said BOEM should consider making certain factors mandatory, for
example, developers should not be able to move forward until it has
developed a CBA or mitigation fund. Alternatively, the commenter said
BOEM could value the benefits to incentivize developers to negotiate
them prior to NEPA review and the NHPA section 106 process.
Response: The list of non-monetary credits in the final rule is
included as representative of the credits that BOEM may offer. BOEM
will continue to consider bidding credits on a case-by-case basis based
on the particular conditions of each lease sale. At this time, BOEM
does not find it appropriate to establish mandatory non-monetary
credits to be used in every sale.
Comment: A commenter said BOEM should consider awarding credits
measured by the degree to which a developer mitigates harm to historic
properties or cultural resources. A commenter said that BOEM should
promote creditable stakeholder agreements, particularly those that
mitigate conflict, improve project approval coordination, focus on
engagement, and those that prioritize data sharing, local needs,
regional scale conservation, or technological solutions to wildlife
impacts.
Response: The list of non-monetary credits in the final rule is
included as representative of the credits that BOEM may offer. BOEM
will continue to consider bidding credits on a case-by-case basis based
on the particular conditions of each lease sale.
Comment: Some commenters encouraged the use of bidding credits to
mitigate impacts to fisheries. For example, a couple of commenters said
bidding credits could fund research, encourage coordination between
developers, and ensure minimum spacing between structures to minimize
impacts to fisheries. A commenter said bidding credits could support
regional fisheries funds to mitigate fisheries impacts.
Response: The list of non-monetary credits in the final rule is
included as representative of the credits that BOEM may offer. BOEM
will continue to consider bidding credits on a case-by-case basis based
on the particular conditions of each lease sale.
Comment: A commenter supported bidding credits for fisheries
mitigation as described in Gulf of Mexico Public Sale Notice Docket No.
BOEM-2023-0021. Some commenters recommended that BOEM explicitly
include benefits for the fishing industry to its list of non-monetary
factors which may be included in multiple-factor auctions. For example,
a commenter recommended additional text at Sec. 585.216(b):
``agreements or commitments by the developer that mitigate for the
impacts of development of the lease site on users of the lease space
and contribute to the continued resilience of those users.'' Another
commenter similarly recommended additional text that would include
fisheries compensatory mitigation as an eligible bidding credit.
Response: The list of non-monetary credits in the final rule is
included as representative of the credits that BOEM may offer. BOEM
will continue to consider bidding credits on a case-by-case basis based
on the particular conditions of each lease sale. Therefore, BOEM did
not make the requested changes to the regulations.
(c)(ii) Comments on what impacts a project could have on
underserved communities.
Comment: A commenter said the main concerns of small fishing
businesses and other ocean users, whom the commenter heard from in a
small business roundtable, were related to mitigation of impacts to
their businesses, and the need for BOEM to find ways to incentivize
developers. According to the commenter, small fisheries expressed
concern about
[[Page 42629]]
uncertain impacts wind energy developments could have on them; many
stakeholders discussed an inability to adequately comment on the
proposed rule and its potential impacts due to the number of unknowns,
including BOEM's stance on mitigation. Additionally, the commenter said
stakeholders felt the proposed rule was premature since BOEM has not
finalized its guidance for mitigating impacts on fisheries.
Response: BOEM will continue to work to ensure that information
regarding OSW development is communicated from BOEM and lessees to
impacted communities frequently and as early as possible in the
process. BOEM does not believe additional regulation is necessary. It
is not clear what effect finalizing fisheries mitigation guidance would
have on this rulemaking, or why waiting for the guidance to be
finalized would inform the provisions of this rule. Further, BOEM is
intentionally developing guidance in lieu of a proscriptive rule to
ensure BOEM retains broad flexibility to address potential impacts to
fisheries.
(c)(iii) Comments on how bidding credits or multiple factor
auctions can be used to promote mechanisms that could address impacts
and provide benefits to the underserved communities.
Comment: A commenter said that bidding credits and stipulations
could encourage developers to engage with community stakeholders and
establish funds for underserved communities. The commenter said these
auction mechanisms could deliver long-term benefits to communities by
encouraging CBAs, regional funds, and workforce development. The
commenter stated that stipulations and bidding credits that support
apprenticeships, local and targeted hire, Project Labor Agreements
(PLAs), and strong labor standards could provide equity benefits. A
commenter said that bidding credits should reward actions that benefit
local communities. According to the commenter, these actions should be
identified prior to each auction through public input, with criteria,
goals, and implementation strategies outlined in the PSN. Additionally,
the commenter suggested that bidding credits requiring additional
commitments by developers ``should be awarded in a manner that
reasonably reflects the cost of the commitments and should be designed
by BOEM in a manner such that the cost of compliance with bid credit
requirements is quantifiable and predictable and has measurable
outcomes based upon information available at the time of bidding.''
Lastly, the commenter said that bidding credits for achievement of
development milestones appear unnecessary and unfair to states where
certain milestones occur after the auction process concludes.
A commenter recommended incentivizing agreements to address impacts
identified through the NEPA and NHPA process.
A commenter encouraged BOEM to use bidding credits for CBAs with
disadvantaged communities to advance the Administration's Justice40
goal. The commenter said BOEM could treat the credits as Federal
investments within the rule and work with the Office of Management and
Budget (OMB) to classify OSW activities as qualifying Justice40
activities. Additionally, the commenter said benefits must be developed
with the communities themselves. Additionally, the commenter
recommended that BOEM consider enforcement mechanisms for ensuring that
benefits promised by lessees are provided. Some commenters recommended
BOEM establish specific criteria for obtaining bidding credits,
including an agreement to consult with relevant labor unions, community
groups, and industry representatives to ensure bidding credits are used
equitably, result in accessible high-quality job creation, minimize
impacts to marine economic activities, and advance civil rights, racial
justice, and equal opportunity goals of the Federal government. Another
commenter suggested that BOEM standardize the types of bidding credits
for impacted communities and use a regional third party-managed fund
for these contributions.
Response: The list of non-monetary credits in Sec. 585.216(b) of
the final rule is included as representative of the credits that BOEM
may offer. BOEM will continue to consider bidding credits on a case-by-
case basis based on the particular conditions of each lease sale.
Comment: A commenter said that BOEM should provide a competitive
advantage to developers that demonstrate a commitment to collaboration
with communities early in the process. For example, BOEM could give
greater bidding credits to developers with existing binding agreements
over developers with mere promises to develop agreements if awarded a
lease.
Response: The list of non-monetary credits in the final rule is
included as a representation of the credits that BOEM may offer. BOEM
will continue to consider bidding credits on a case-by-case basis based
on the particular conditions of each lease sale. Further, incentivizing
binding agreements prior to a lease sale could result in many bidders--
many of whom will be unable to win a lease--spending time and resources
negotiating agreements. Because these will not result in projects that
can move forward, such investments of time and energy on the part of
both bidders and potentially affected communities will be wasted.
Comment: Some commenters said, ``the Final Rule should require any
conceptual strategy submitted to qualify for bidding credits be made
publicly available and include details for development of a community
benefits plan that commits to consultation with community stakeholder
and labor unions to ensure credits result in quality jobs and equity.''
The commenters referred to DOE's Funding Opportunity Announcement for
Regional Hydrogen Hubs Community Benefits Plans as a model for the
information BOEM requires in conceptual strategies. According to the
commenters, projects funded under this model are expected to include
Community Benefits Plans that support meaningful engagement; invest in
America's workforce; advance diversity, equity, inclusion, and
accessibility; and contribute to the Justice40 Initiative.
Additionally, the commenters said that bidding credits invested in
supply chain facilities must require suppliers to use a supplier code
of conduct that includes equitable access to jobs, among other things.
Response: Conceptual strategy requirements are determined on an
auction-by-auction basis and are outside the scope of the current
rulemaking. BOEM does not make conceptual strategies publicly available
to protect bidders' claims of business confidential information. BOEM
could require bidders to submit conceptual strategies that do not
contain such information, but BOEM would expect to receive less useful
information as a direct result. Bidding credits offered for workforce
training and supply chain development are designed to further the
development of OSW and cannot be directed to specific communities.
Comment: A commenter recommended that BOEM stipulate that lessees
enter into PLAs covering the construction of renewable energy projects.
The commenter stated that PLAs ensure access to unions, support
training, promote safety, and increase economic benefits for local
communities. Similarly, commenters said that PLAs and LPAs should not
be credits, bidders should be required to certify that they will
operate with PLAs and LPAs. Additionally, the
[[Page 42630]]
commenters said that workforce development should be considered in
BOEMs multi-factor evaluation of bids, however, workforce development
should exclude programs with no record of achievement. The commenters
stated that bidders should be required to describe their workforce
program's substance, history, and effort to recruit disadvantaged
communities.
Response: BOEM is very interested in promoting the use of union
labor and PLAs, and BOEM has introduced language supporting the use of
PLAs into our leases and the lease sale process for this purpose.
However, BOEM declines, at this time, to require PLAs in all cases by
regulation.
Comment: A commenter said the final rule should include mandatory
elements to address economic and environmental impacts to Tribes and
adjacent communities, including a Tribal benefit agreement to offset
all tribal impacts. The commenter said bidding credits should be
awarded to bidders who have developed agreements with Tribes before the
bidding process. A commenter said that funds accepted from developers
need to provide direct funding to Tribes that they can use to hire
independent technical experts to represent them/their interests,
because the current process asks too much of Tribes without
compensating them for their time.
Response: BOEM seeks to mitigate economic and environmental impacts
of projects on Tribes and adjacent communities throughout the leasing
and development process. While BOEM recognizes the commenter's interest
in bidders that are responsive to Tribal and other community needs,
BOEM has declined to require bidders to engage with Tribes and
communities before the lease sale takes place, understanding that
outreach from bidders who will not win a lease may represent an undue
burden for both Tribes and bidders. Providing a credit for pre-sale
mitigation agreements would likewise represent unreasonable effort for
both Tribes and bidders (particularly those that ultimately do not win
a lease in the auction).
Comment: Some commenters stated the policy-based factors described
in Sec. 585.216(b)(5) should qualify for bidding credits. Some
commenters recommended that BOEM implement bidding credits for funding
affected Tribal Nations, underserved communities, fisheries, affected
coastal communities, domestic supply chain development, and equitable
workforce training. A commenter recommended that BOEM add to its non-
exclusive list in proposed Sec. 585.216(b) a credit for funding
commitments for affected coastal communities and Tribal Nations. The
commenter proposed regulatory language to reflect this revision.
According to the commenter, including a credit for Tribal Nations could
support socioeconomic benefits, and Tribal participation in the
permitting process.
Response: BOEM does not agree with the commenter's proposal to add
additional language to Sec. 585.216. The bidding credits listed in
Sec. 585.216(b) are meant to be representative, and BOEM retains the
flexibility to add or remove bidding credits at a future time. Bidding
credits are designed to further the development of OSW or mitigate
impacts and cannot be directed to specific communities. The final
rule's Sec. 585.216(b)(7) provides flexibility for BOEM to expand upon
entities to whom the bidding credits may be offered.
Comment: A commenter recommended that eligible credits should
include bidder commitments to ensure that local underserved affected
communities are prepared for offshore development via shoreside
infrastructure, workforce development, supply chain, community
benefits, and resilience measures for fishing industries; consult with
and address concerns of Tribal nations; and ensure sustainable access
for other ocean users including fisheries.
Response: The list of non-monetary credits in the final rule is
included as representative of the credits that BOEM may offer. BOEM
will continue to consider bidding credits on a case-by-case basis based
on the particular conditions or circumstances of each lease sale.
(c)(iv) Comments on alternatives to achieving public policy goals.
Comment: A commenter recommended including lease stipulations
consistently across auctions (with some flexibility in deference to
local context) for PLAs, domestic content utilization, environmental
justice provisions, meaningful community engagement, domestic supply
chain development, and environmental protections. The commenter also
recommended BOEM explore other lease stipulations that could advance
public policy priorities (e.g., workforce training, natural resource
protection).
Response: BOEM acknowledges the challenges that changes between
lease sales cause for bidders. As a policy matter, BOEM tries to take
this into account in developing the lease terms and auction format.
However, BOEM also seeks to be responsive to regional stakeholder
interests and comments received during regional Task Force meetings and
the PSN comment period. BOEM must strike a balance between
responsiveness to comments and not making unnecessary, or unnecessarily
large, changes.
Comment: Some commenters said that LPAs would advance goals under
OCSLA, including ensuring a fair return to the United States.
Response: BOEM is supportive of PLAs and has included lease
language encouraging lessees to enter into PLAs for the construction
stage of OSW projects. It is up to local bargaining units and OSW
developers to negotiate PLAs terms that could include elements of LPAs.
BOEM declines, at this time, to address either PLAs or LPAs by
regulation.
Comment: A commenter asked for the rule to establish annual
compensation fees for marine-based ecosystem service losses due to wind
plants. A commenter said revisions to Sec. 585.506 to allow for
operating fee credits is a logical outgrowth of BOEM's proposal to
formalize multiple factor auctions and bidding credits. A commenter
said that a required annual payment on a lease, in the form of a lease
stipulation, could be used for mitigation or compensation. The
commenter described these operating fee credits as comparable to
bidding credits but occurring outside of the auction stage and
incorporated into lease stipulations. The commenter also said that BOEM
could allow lessees to claim a bidding credit for an agreement to
annually contribute the amount of the credit to a resiliency fund. The
commenter suggested this option be made available for existing lessees
as well.
To further policy goals being pursued through bidding credits, a
couple of commenters recommended the use of operating fees to provide a
base level of funding to address ongoing project impacts, including
investments in fisheries compensatory mitigation funds, disadvantaged
communities, tribal needs, shoreside infrastructure, transmission, and
supply chain and workforce development.
Response: Proposals about annual compensation requirements,
operating fee credits, and lease stipulations, whether for future
lessees or existing ones, are outside the scope of the current
rulemaking. However, these are initiatives that BOEM can still consider
under the specific terms of a lease sale without the need of adding
additional regulatory provisions.
Comment: Some commenters said that BOEM has broad discretion and
authority under OCSLA to require the use of domestically sourced
materials. A commenter recommended that the
[[Page 42631]]
Secretary use such discretion to satisfy various subsection 8(p)(4)
requirements through lease and COP terms, conditions, and stipulations.
According to the commenter, doing so would be consistent with the
Administration's climate goal.
Response: BOEM is very interested in ensuring, as much as it can,
that the U.S. supply chain is adequately developed and capable of cost-
effectively serving the needs of the U.S. OSW industry. The most
important factor needed to enable the supply chain to become
sufficiently developed is a reliable pipeline of OSW projects. BOEM
strives to make suitable offshore acreage available for this purpose,
but it is also important that the cost of OSW be low enough for states
and utilities to support it. This means balancing the desire to
accelerate domestic sourcing with controlling OSW development costs.
For this reason, BOEM has investigated other methods of promoting the
domestic supply chain, such as bidding credits, over potentially more
costly options such as a requirement to source materials domestically.
(d) Improper or Inappropriate Bidder Communications.
Comment: A few commenters agreed with the overarching intent of
BOEM's proposal to prohibit improper or inappropriate bidder
communications; however, they suggested revisions to BOEM's proposed
language in Sec. 585.222(f). A couple of commenters stated that the
proposed language at Sec. 585.222(f) is too broad, expressing concern
that the proposed language could prevent legitimate and necessary
conversation between potential joint-venture participants and limit
participation in auctions. A commenter recommended revising the
provision ``to state that the prohibited communications are limited to
those between bidders who actually participate in an auction (not
precluding conversations between two bidders listed in a FSN where one
bidder ultimately does not participate) and involve strategies and
valuations related to a specific auction (not precluding discussions
about high-level strategies and valuation approaches).''
Response: BOEM decided not to finalize the proposed regulations
regarding bidder communications. BOEM sees advantages to the proposal
that BOEM made in the NPRM. BOEM also sees that commenters raised valid
concerns with the proposed language. However, BOEM has questions about
some of the specifics of the commenter's proposals. Accordingly, BOEM
declines to add regulatory provisions governing bidder communications
at this time. Bidder communications can continue to be regulated on a
case-by-case basis in the sale notices of BOEM lease sales. Further,
BOEM notes that notwithstanding BOEM's regulations regarding
communications prior to an auction, bidders remain subject to antitrust
laws, which may prohibit behavior not specified in BOEM's regulations.
Comment: Another commenter recommended specific revisions to Sec.
585.222 as follows: ``[add: (c) Bidders qualified by BOEM under
Sec. Sec. 585.106 [585.107] and 585.107 [585.108] must notify BOEM no
later than the due date of the Bidder's Financial Form of (1) any
change to the corporate form or identity of the qualified bidder (or
its members if the qualified entity is a partnership or limited
liability company); or (2) a material reduction in the technical or
financial capabilities of the qualified bidder.]
([add: d] [delete: c]) Only an authorized agent may act on a
bidder's behalf during an auction. Bidders must submit the names of
their authorized agents to BOEM before the auction, as prescribed in
the FSN.
([add: e] [delete: d]) Each bidder must follow the auction process
specified in the FSN and may not take any action to disrupt or alter
the process beyond its intended function.
([add: f] [delete: e]) A bidder is responsible for immediately
contacting BOEM if it is unable to submit its bid for any reason during
an auction. If a bidder fails to timely notify BOEM of its inability to
bid, it may not dispute the auction or lease award on that basis. If a
bidder timely notifies BOEM of its inability to submit a bid, BOEM, in
its discretion, may suspend the auction, continue the auction using an
alternative method, or continue the auction without the participation
of the affected bidder.
[Delete: (f) Bidders may not disclose their auction strategies or
economic valuations of a lease area to other bidders listed in the
FSN.]
[Add: (g) Notwithstanding your eligibility pursuant to section
585.106 and section 585.107, you may not participate in a lease sale
under this Part if another person with whom you are affiliated
participates separately in the same lease sale.
(h) An affiliate is a bidding entity who controls, is controlled
by, or is under common control with another bidding entity, as may be
specified in more detail in the final sale notice for a lease sale.
(i) An agreement between two persons for future shared investment
in a lease to be sold by us pursuant to section 585.220 or section
585.231 does not itself create affiliation but must be disclosed to
BOEM in writing by the date specified in the final sale.
(j) Where the final sale notice for a lease sale states that a
bidder may not win more than a specified number of leases offered for
sale, BOEM may exclude from participation in the lease sale any person
who has entered into a joint bidding agreement(s) or a future shared
investment agreement(s) that would cause the person to be affiliated
with the initial owner(s) of more than the specified number of leases
offered for sale.
(k) If you are eligible pursuant to section 585.106 and section
585.107, you may participate in a lease sale on behalf of yourself and
one or more other person(s) eligible to participate in the lease sale
provided that (i) you notify us in writing of your intention to do so
by the date specified in the final sale notice and (ii) these other
bidder(s) do not otherwise participate in the lease sale.]''
Response: BOEM has not adopted the language proposed by the
commenter in the final rule. Much of the content of this proposal can
be implemented outside the rulemaking process, and BOEM declines to
finalize language in this rule absent further consideration and
opportunity for public comment.
Comment: A commenter opposed BOEM's proposed language in Sec.
585.222(f), asserting that it is overly broad and could impede
appropriate commercial speech. The commenter also asserted that it
would reduce competition and BOEM's ability to obtain a fair return for
the U.S. taxpayers and is unnecessary due to antitrust review conducted
by the U.S. Department of Justice.
Response: BOEM eliminated the proposed Sec. 585.222(f) that BOEM
had proposed to add in the NPRM. Although BOEM believes it is
appropriate to restrict communications between bidders for policy
reasons related to antitrust and anticompetitive concerns, commenters
raised valid concerns about the specific language proposed. BOEM,
however, declines to address this in the manner proposed by the
commenter, by creating a new section governing BOEM's implementation of
one-per-customer restrictions in lease sales.
BOEM will continue to restrict bidder communications, and one-per-
customer restriction implementation, on a case-by-case basis in lease
sale documents rather than in the final rule as it continues to refine
its requirements.
Comment: A couple of commenters requested that BOEM define
``affiliated entities'' or ``affiliate,'' including what constitutes
``control'' of one entity over
[[Page 42632]]
another. A commenter said it should be clear that ``control'' extends
only to the immediate parent(s) of the bidding entity.
Response: BOEM has decided to retain the flexibility to continue to
develop its definition of affiliates in individual lease sales, and so
has not included a definition in the final regulations.
(e) Other comments on lease issuance procedures.
Comment: Some commenters recommended maintaining the current
requirements for area identification that state, ``BOEM will develop
measures . . .'' rather than the proposed revision which states, ``BOEM
may develop measures . . .'' Some commenters expressed concern that the
proposed revision would create uncertainty and weaken mitigation
standards.
Response: BOEM's existing regulations on area identification state
that ``BOEM will evaluate the potential effect of leasing on the human,
marine and coastal environments and develop measures to mitigate
adverse impacts including lease stipulations'' (Sec. 585.211(b)(2)),
and ``BOEM will consult to develop measures, including lease
stipulations and conditions, to mitigate adverse impacts on the
environment'' (Sec. 585.211(b)(3)). The proposed language in the NPRM
states that ``BOEM may develop measures, including lease stipulations,
to mitigate potential adverse impacts.''
It was never BOEM's intention to signal that BOEM may not develop
measures, including lease stipulations, to mitigate potential adverse
impacts. Stipulations and mitigations can be identified at any time
before the FSN is published, and the process of flagging such measures
begins early in the process. Accordingly, BOEM has changed ``may'' back
to ``will'' in the final rule. Moreover, BOEM added Sec. 585.212(c)(3)
to clarify that measures will continue to be developed through later
environmental reviews and consultations and will be published in the
PSN.
Comment: A commenter recommended revisions to BOEM's lease planning
regulations at 30 CFR part 585, subpart B, to support advanced planning
for shared transmission systems.
Response: BOEM continues to advance a more planned approach to
transmission solutions for offshore wind, including the use of shared
infrastructure. BOEM has the authority to permit shared transmission
infrastructure through both the COP and ROW processes. It should be
acknowledged that State processes play a large role in the potential
use of shared transmission systems, and accordingly, BOEM has sought to
improve clarity for the process where a State or RTO/ISO is involved by
revising 585.307(c).
Comment: A commenter said that BOEM should clarify the meaning of
``in a timely manner'' in proposed Sec. Sec. 585.231(f) and
585.306(b)(2).
Response: The CZMA regulations under 15 CFR part 930, subpart D do
not have a set time requirement for the applicant to submit the
consistency certification and the necessary data and information to the
State CZMA agency. It is implied that the applicant will submit the
information necessary to conduct an adequate consistency review in a
timely manner so as not to delay the progress of the application for
approval of a noncompetitive lease. The time requirements outlined in
15 CFR 930.60 go into effect upon submittal of all necessary data and
information required by the State's CZMA agency. Therefore, BOEM added
the phrase ``in a timely manner'' to proposed Sec. 585.231(f) to
stress to the applicant that delay in submitting the consistency
certification and necessary data and information to the State's CZMA
agency and BOEM may delay its application. As provided in proposed in
Sec. 585.231(e)(2), BOEM reserves the right to withdraw a
determination of no competitive interest before the two-year expiration
date if BOEM determines that the applicant has failed to exercise due
diligence in obtaining a lease. To be consistent, and for the same
reasons as above, BOEM has revised the second sentence of Sec.
585.306(b)(2) in the final rule to read, ``After BOEM publishes this
notice, you are responsible for submitting any required consistency
certification and necessary data and information in a timely manner to
the applicable State CZMA agency and BOEM pursuant to 15 CFR part 930,
subpart D.''
Comment: A commenter requested that BOEM ``codify the concept that
a bid awardee from a state solicitation process is the only qualified
applicant for the Right-of-Way/Right-of-Use and Easement (ROW/RUE)
grant for the relevant OSW transmission project(s) and therefore, there
is no competitive interest for that grant.'' The commenter said this is
necessary to ensure projects are not delayed due to an unnecessary
competitive grant process. The commenter reasoned that a key factor in
determining competitive interest is whether a party is ``qualified'' to
hold a ROW/RUE grant, and BOEM can reasonably determine that
transmission developers who were unsuccessful in the State solicitation
process are not qualified. Next, the commenter said BOEM would
determine whether there is a conflict for the proposed project area.
The commenter said it is unlikely that BOEM would determine that there
is a conflict for the proposed area, because ROW and RUE grants are
non-exclusive rights and therefore unlikely to exclude future uses of
the area.
Response: The commenter has highlighted an important issue related
to determining competition for a ROW/RUE and the interaction of this
process with State processes where the OCS project crosses into State
jurisdictional waters. However, the qualifications process suggested by
the commenter is not the best way to address such issues. Any grantee
or lessee is required to be qualified legally, technically, and
financially prior to issuance of a grant or lease. A company is
permitted to qualify as a prospective company at any time, including
prior to entering any State solicitation process. Therefore, being
qualified to acquire a lease or grant is not a good indicator of
competitive interest.
BOEM currently has the authority to issue a ROW/RUE grant either
competitively, or non-competitively as described in Sec. Sec. 585.300-
585.316, after coordinating and consulting with relevant Federal
agencies, the Governor of any affected State, and the executive of any
affected local government. BOEM must first determine if there is
competitive interest, which is accomplished by publishing a public
notice describing the parameters of the project, to give affected and
interested parties an opportunity to comment on the proposed grant
area. BOEM currently has the authority to work with a State seeking a
ROW/RUE grant for purposes of transmission, and as the ROW would
necessarily need to be continued through State waters and land for the
purpose of interconnection to the grid, there is a need to align these
processes. However, BOEM agrees that regulatory clarity is helpful in
this instance and has revised Sec. 585.307(c) of the final rule to
acknowledge the complications that may arise in determining competitive
interest for transmission projects and to note that coordination with
projects authorized on State submerged lands may be taken into
consideration in making competitive interest determinations.
Comment: A few commenters suggested that a BOEM-run auction is not
the only option for a competitive process that would meet OCSLA
requirements. One commenter suggested that BOEM allow a State to hold a
competitive solicitation process and award a lease to the winner of
that
[[Page 42633]]
auction process. This commenter also suggested that BOEM include in the
final rule that any legally binding agreements to undertake future
shared lease investment should be disclosed to BOEM prior to the sale
but does not create an affiliate definition. The commenter further
suggested that BOEM exclude from auctions any person who has entered
into such an agreement when there are restrictions in the FSN.
Response: BOEM appreciates the creative thinking on meeting OCSLA's
competitive mandate. BOEM has considered adopting a State competitive
process as meeting the competitive requirement for issuing a lease,
however, BOEM has also identified several important challenges with
such an approach, including timing (State solicitations normally
require that applicants demonstrate site control) and challenges around
coordinating with State RFPs, and the fact that most State RFPs contain
requirements and considerations that would not normally be found in a
Federal offering.
BOEM acknowledges the concern about drafting a definition of
affiliation that does not unnecessarily restrict joint ventures and
otherwise permissible forms of collaboration on OSW but has declined to
include such language in the final rule, preferring to address this in
individual lease sales.
Comment: A commenter said that it seems like a logical outgrowth of
BOEM's proposed revisions to Sec. 585.222 to add information about the
appropriate process to update qualification materials during BOEM's
review or after BOEM's confirmation of qualification. The commenter
said that only changes to corporate form or identity of the bidder, and
changes that materially reduce the technical or financial capabilities
of the bidder should merit notice to BOEM. Accordingly, the commenter
requested that BOEM include a provision in Sec. 585.222 describing
when BOEM must be updated and how/when eligible bidders must notify
BOEM of relevant changes. The commenter suggested further revision to
Sec. 585.222 to allow for joint bidding in lease sales and to define
an ``affiliate.'' The commenter provided draft regulatory text that
would implement these modifications.
Response: BOEM has added language to Sec. 585.222 describing new
triggers for qualification determinations. BOEM has declined to add a
definition of ``affiliate'' to the regulations at this time. BOEM's
sale notices provide the specific requirements in instances where
bidders are participating in joint ventures. BOEM does not see a need
to establish these requirements by regulation.
3. What is the Department finalizing?
(a) Sec. 585.106 What happens if I fail to comply with this part?
BOEM is finalizing the proposed clarifications of its process
surrounding the imposition of civil penalties. BOEM made minor
revisions to this provision to ensure consistency with OCSLA.
(b) Sec. 585.210 What are the steps in BOEM's competitive lease
award process?
BOEM is largely finalizing the NPRM proposal to reorganize,
simplify, and clarify the regulatory sections detailing the steps
leading to an OCS renewable energy auction. The final rule preserves
the concept of a ``provisional winner'' that was introduced in the
NPRM, referring to a successful bidder before the execution of a lease,
at which point a ``provisional winner'' can become a ``lessee.''
Revised Sec. 585.225 combines the reconsideration and appeals
provisions into a single paragraph (e). BOEM also removed the
requirement to execute three copies of the lease, which is appropriate
given the more widespread adoption of electronic forms, which was
already underway in 2020, but accelerated during the COVID-19 period.
BOEM is eliminating the ``Request for Interest,'' which was similar
enough in name and purpose as to be frequently confused with the
``Request for Information.'' BOEM retains the Request for Information,
described in Sec. 585.116, which BOEM may use to gather any manner of
information from industry, federally recognized Tribes, State and local
agencies, and other interested entities. Accordingly, the Request for
Information can easily be employed to gather the same public input that
would once have been solicited in a Request for Interest.
BOEM reviewed the request to include ``archaeological and/or
culturally significant sites on the seabed or nearshore, including
viewsheds and traditional cultural landscapes and properties.'' BOEM
determined that the final rule will require this information to be
included in SAP, COP and GAP. The list to which the commenter requested
to add the specified language is merely suggestive of the kind of
information that BOEM may request. The regulations list a few of the
kinds of information that BOEM can specifically request in these
notices, but the intent is not to provide a list of all the information
that BOEM could request. In practice, BOEM does request other kinds of
information. For example, in a recent California Call for Information
and Nominations (86 FR 40869), BOEM requested that the public submit
information on viewshed, archaeological and cultural resources sites,
and historic properties. In other words, BOEM is already requesting the
information that the commenter has asked BOEM to add to the
regulations.
(c) Sec. 585.213 What information is included in the PSN?
Sec. 585.214 What information is included in the FSN?
The final rule simplifies and clarifies auction regulations, mostly
as proposed in the NPRM. The final rule replaces the lists of
permissible auction formats, bid variables, and bidding processes with
a more flexible process consistent with current BOEM practices. Under
the revised regulations in Sec. 585.213, BOEM will propose auction
procedures for 60-calendar day comment in a PSN, including auction
format and lease terms and conditions. Final auction details, under 30
CFR 585.214, will be published in the FSN at least 30 calendar days
before the auction. These changes would permit BOEM to hold lease sales
that do not conform to the previously enumerated auction formats and
bidding systems, should circumstances warrant, though BOEM has no
immediate plans to do so.
(d) Sec. 585.216 How are bidding credits awarded and used?
BOEM is finalizing provisions pertaining to multiple factor
auctions and bidding credits in Sec. 585.216. These were permitted
under BOEM's existing regulations; however, the final rule establishes
bidding credit authority that better reflects how these have been
implemented in BOEM's lease sales. Bidding credits permit the agency to
recognize other policy priorities, like advancing a domestic supply
chain or promoting workforce training, in addition to monetary bid
amounts. BOEM may design bidding credits that are based on actions the
bidder has already taken or for commitments to take future actions. The
final rule also specifies in Sec. 585.225(g) that BOEM can force a
bidder to repay the amount of the bidding credit, with interest, if it
does not meet the applicable commitments. This authority is backed up
by its authority to assess civil penalties under Sec. 585.106(e).
BOEM's bidding credits provisions are included in revised Sec.
585.216. BOEM lists a half dozen examples of bidding credits that the
agency could choose to implement in a lease sale. BOEM declined to add
to this list, despite comments requesting the addition of specific
other bidding credits. However, the list is not exhaustive, permitting
the agency to offer bidding credits in future lease sales
[[Page 42634]]
for ``any other factor or criteria to further development of offshore
renewable energy, as identified by BOEM in the PSN and FSN.''
(e) Sec. 585.222 What other auction rules must bidders follow?
BOEM is not finalizing the provision proposed in new Sec.
585.222(f) that would have prohibited a bidder from disclosing auction
strategies or economic valuations of a lease area. BOEM may still
prohibit such communications in the auction rules published pursuant to
individual lease sales, however, commenters raised questions about the
definition proposed by BOEM, and given BOEM's authority to regulate
this in individual lease sales, the agency has decided not to finalize
the prohibited communications provision at this time.
(f) Sec. 585.224 What will BOEM do after the auction?
Post-auction procedures are likewise revised, largely tracking the
proposals detailed in the NPRM. In Sec. 585.225(f), BOEM changed the
due date for payment of the first 12 months' rent on a new lease to 45
calendar days after the winning bidder receives a copy of the executed
lease from BOEM.
(g) Sec. 585.225 What happens if BOEM accepts a bid?
Section 585.225 addresses obligations of provisional winners after
the auction and before execution of a lease. From the date of receipt
of the unsigned lease, the provisional winner has 10 business days in
which to execute and return the lease to BOEM, file the required
financial assurance, and pay the amount due. The provisional winner may
request an extension of the 10-day deadline in writing.
(h) Sec. 585.226 What happens if the provisional winner fails to
meet its obligations?
The final rule adds clarifications on what actions BOEM may take if
the provisional winner fails to timely complete these steps. Section
585.226(a) authorizes BOEM to decline to execute the lease, decline to
execute other leases that the provisional winner may have won in the
auction, require forfeiture of the bid deposit, refer the matter for
suspension or debarment review, or impose other remedies. Further,
under Sec. 585.226(b), BOEM may award the lease to the next highest
bidder, repeat the auction under Sec. 585.224(f), or use any other
procedures specified in the FSN.
(i) Sec. 585.438 What happens to leases or grants (or portions
thereof) that have been relinquished, contracted, or cancelled?
The final rule adopts proposed Sec. 585.438, which describes
actions that BOEM may take if a lease or grant is relinquished,
contracted, or cancelled. Before this rulemaking, the regulations were
silent about how BOEM would address such cases. Under paragraph (a) of
this section, BOEM may restart the competitive process at a stage that
BOEM deems reasonable (e.g., from the beginning, from the Call, Area
Identification, PSN, or FSN). Under paragraph (b), if the lease or
grant is relinquished, contracted, or cancelled within six months of
the lease sale, BOEM may reoffer it to the next highest bidder.
G. Risk Management and Financial Assurance
1. What did the Department propose?
Sec. Sec. 585.516; 585.520; 585.521; 585.526; 585.527; 585.528;
585.529.
BOEM proposed four main amendments and requested comment on two
concepts in the NPRM preamble (88 FR 5987). The four main amendments
were: a) eliminating the COP approval financial assurance requirement
(Sec. 585.516); b) revising lease-specific financial assurance amounts
(removal of Sec. 585.515 and changes to Sec. Sec. 585.520 and
585.521); c) accepting additional types of financial assurance
instruments (Sec. Sec. 585.526 and 585.528); and d) funding of
decommissioning accounts based on a BOEM-approved schedule (Sec. Sec.
585.516 and 585.529). BOEM also requested public comment on these two
concepts: e) using a minimum credit rating threshold for BOEM's
evaluation of the financial strength and reliability of a lessee, grant
holder, or third-party guarantor (Sec. 585.527); and f) explicitly
relying on financial strength and reliability evaluation of joint and
severally liable parties when determining the need for financial
assurance.
2. What are the key public comments?
(a) Sec. 585.516 Elimination of COP approval financial assurance
requirements.
Comment: Multiple commenters expressed support for BOEM's proposal
to eliminate the supplemental financial assurance currently required
before COP approval. The commenters stated that the proposed change
would encourage offshore wind development by reducing overly burdensome
financial assurance requirements while continuing to protect the public
against risks of default. Additionally, commenters highlighted that
decommissioning liabilities do not accrue from COP approval, only with
the commencement of approved activities on the OCS.
Response: BOEM has finalized moving the deadline for complying with
financial assurance requirements from the COP stage to prior to
starting construction. BOEM feels that an adequate balance between the
need to protect the U.S. taxpayers and not overburden the industry with
financial requests that do not reflect the actual risk that is being
mitigated, is in accordance with the proposed elimination of
supplemental financial assurance before there is an actual liability
that needs to be covered by financial assurance.
Comment: A commenter expressed opposition to elimination of the COP
approval financial assurance requirement and stated that it was an
irresponsible proposal by BOEM. The commenter stated that ``the
proposal presumes financial project viability and consistent ongoing
revenues for a period of 35 years or more with disregard for uncertain
financial, environmental, engineering, legal, and weather-related
risks.'' They further stated that ``[e]nergy-utility projects are in
essence traditional public-private partnerships where technical and
financial risks are transferred to the private sector in exchange for
the opportunity to generate revenues and profit. Under the proposed
rule, the Federal government is instead transferring risks associated
with decommissioning to the consumer rather than to the private
sector.''
The commenter states that ``[w]hile BOEM believes that if a
developer becomes insolvent during commercial activity that a solvent
entity would assume or purchase control, the County believes this is a
risky assumption as the most likely reason for default is that a
constructed wind farm developer is unable to meet its contractual
obligations set forth under a Power Purchase Agreement (PPA) because
its energy production revenues are not in excess of its operating
costs. A change of hands would not remove these circumstances or make
the project profitable.''
Response: The first part of this comment discusses financial
assurance requirements at COP approval, which occurs prior to any
offshore facility installation. Since BOEM's financial assurance
requirements reflect a project's liabilities, there is no reason to
require financial assurance until facility installations begin. BOEM
does not agree with the commenter that the period between COP approval
and installation presumes a level of viability, that it would last 35
years, or that this proposal transfers all risk to the consumer rather
than the private sector.
[[Page 42635]]
The second part of this comment relates to the provisions that
allow lessees to fund a decommissioning financial assurance account
over time on a schedule approved by BOEM. BOEM does not agree with the
commenter that it would be a ``risky assumption'' that a project's
energy production revenues would exceed its operating costs. Renewable
energy projects typically have low operating expenses since there is no
cost for fuel and the equipment only needs to be maintained. Therefore,
the energy production revenue is several multiples of the operating
expense. Having a decommissioning financial assurance account funded
over time from that revenue should greatly reduce the chance that a
lessee will not have sufficient resources to meet its decommissioning
plans at the end of the lease.
(b) Sec. Sec. 585.520-585.521 Lease-specific financial assurance
amount.
Comment: Multiple commenters expressed support for BOEM's proposed
revision of the lease-specific financial assurance amounts and
concurred this action would not compromise taxpayer protection. One
commenter stated that under the current rule, BOEM is exposed to the
risk of default only during the period between lease issuance and rent
payment, and that risk is mitigated by BOEM's prequalification metrics,
and the likely interest of the next highest bidder. An additional
commenter stated that the lease-specific financial assurance amount
revision should also address later stages of a lease, including the
full decommissioning amount.
Response: BOEM agrees that the proposed changes should reduce the
upfront capital burden on lessees without compromising taxpayer
protection. BOEM is finalizing the revisions to lease-specific
financial assurance amounts as proposed. BOEM disagrees with the
assertion that the lease-specific financial assurance amount proposed
changes should also include decommissioning funds since there is no
decommissioning liability associated with the mere act of purchasing a
lease without facilities installed on it.
Comment: A commenter stated that the lease specific financial
assurance amount revision should also address later stages of a lease,
including the full decommissioning amount.
Response: BOEM disagrees with the commenter's assertion that the
lease-specific financial assurance amount proposed changes should also
include decommissioning funds since there is no immediate
decommissioning liability associated with purchasing a new lease. Once
there is decommissioning liability on a lease, following a COP
approval, financial assurance will still be required. If the commenter
is referring to Sec. 585.520, BOEM did not propose to eliminate any
financial assurance requirement, it only proposed to require financial
assurance by stages, to the moment in which the actual risk/liability
exists, otherwise BOEM would be requiring financial assurance for a
liability or risk that does not yet exist.
(c) Sec. Sec. 585.526; 585.528 Additional authorized financial
assurance instruments.
Comment: Several commenters expressed support for BOEM's proposal
to authorize additional financial assurance instruments, including
letters of credit and other instruments not currently listed. One of
those commenters stated that ``securities such as parent guarantees or
bonds should be acceptable financial assurance in all circumstances . .
. subject to reasonable negotiation. . . .''
Response: BOEM is finalizing the proposed provisions, which will
provide flexibility for lessees to fulfill their obligations. This
ensures that lease obligations are fulfilled while providing
flexibility for lessees to comply with their obligations.
Comment: A commenter did ``not object'' to allowing letters of
credit as financial assurance instruments, however, the commenter did
object to the proposed catch-all provision that would grant BOEM
authority to accept instruments not explicitly listed. The commenter
cautioned against the use of a combination of instruments, other than a
trust account combined with one other instrument, reasoning that it
would be difficult to construct a layered combination that would
provide the necessary financial assurance. The commenter discussed
recent bank failures, claiming that not many companies could be relied
upon for such large sums of money over the 30+ year span required for
these projects. Additionally, the commenter objected to BOEM's proposal
to allow guarantors to cap their liability at a specific amount,
because it would require BOEM to accurately determine the dollar amount
that will be needed in the future, which would put taxpayers at risk if
BOEM underestimated the needed amount due to inflation or other
unforeseen circumstances.
Response: The proposed rule proposed to add catch-all provisions
clarifying that BOEM may accept instruments not explicitly listed as
well as combinations of different instruments; however, these
instruments would need to meet BOEM's general requirements for
financial assurance. BOEM was unable to determine why the commenter
believes it would be difficult to layer a combination of financial
assurance or why the reference to bank failures is applicable to the
OSW industry, so BOEM cannot respond to those portions of the comment.
Regarding the risk of underestimating the decommissioning
liability, the risk is similar if a guarantor has limited its liability
to a specific amount, if a surety bond provider has supplied a bond
with a specific limit, or if the lessee has a fully-funded
decommissioning account--the cost of decommissioning may exceed the
original estimate and the lessee is still responsible for meeting that
obligation. Since the risk is similar in each of these financial
assurance instruments, BOEM is finalizing these amendments as proposed.
Comment: A commenter stated that financial assurance ``could be
provided with a combination of authorized financial instruments, but a
fully funded trust account would be preferable from the public
protection perspective.'' Additionally, they noted that ``the total
amount they guarantee should from the start be the full decommissioning
amount. If a trust fund is built up over time with operating revenues,
then the additional financial supports could be reduced by a comparable
amount.''
Response: BOEM agrees that a fully funded trust account would
provide a high level of protection. This approach could be too risk-
averse in some cases, however, and lead to unnecessary costs and
administrative burdens placed on lessees. There could be other risk-
reduction factors present including insurance, performance guarantees,
manufacturer warranties, or power purchase agreements that reduce the
risk of non-performance and it is important to consider these in the
overall financial assurance evaluation.
(d) Sec. Sec. 585.516 and 585.529 Staged funding of
decommissioning accounts.
Comment: Three commenters stated that the decommissioning process
is unclear, adding that industry should be required to obtain bonds to
cover future decommissioning for both towers and offshore export cable
corridors.
Response: As discussed in the preamble to the proposed rule (at 88
FR 5987), under the existing subpart E of part 585, BOEM requires
lessees and grant holders to provide financial assurance, in the form
of a bond or other instrument, in an amount sufficient to guarantee
compliance with terms and conditions of their leases and grants,
including decommissioning. BOEM's
[[Page 42636]]
approach requires supplemental financial assurance to cover
decommissioning when there is a risk that the current lessee will not
be able to meet its performance obligations. BSEE's regulations at 30
CFR part 285, subpart I require that, within 2 years following
termination of a lease or grant, the owner must decommission all
facilities, projects, cables, pipelines, and obstructions on their
lease. BOEM and BSEE disagree that these requirements are unclear or
that bonds are not required and have not made any changes due to these
comments.
Comment: Multiple comments were submitted both supporting and
opposing the proposed amendments to allow staged funding of
decommissioning accounts. Several commenters stated that current
decommissioning requirements place an undue burden on the lessee, while
the proposed staged funding reduces the burden on developers while
continuing to protect taxpayers. Several commenters generally supported
staged decommissioning but stated that BOEM should monitor the approach
to ensure its assumptions hold true, and that risks to taxpayers remain
low. Another commenter expressed support for staged decommissioning
funding and suggested BOEM should schedule the funding to begin toward
the end of the revenue contract term, stating that ``[d]uring the life
of the revenue contract a project will have substantial guarantee of
cashflow and solvency which make funding decommissioning in a lump sum
premature.''
In contrast, several commenters were concerned that staged
decommissioning could result in situations where the account may be
unable to cover early decommissioning costs in the event of unforeseen
circumstances (e.g., extreme weather, lawsuits, etc.), bankruptcy, or
at the conclusion of the lease. Commenters expressed concern that if a
company were to go out of business (i.e., the developer files for
bankruptcy prior to the end of the lease term) without providing
decommissioning costs upfront, the decommissioning account may not be
fully funded.
In the NPRM, BOEM also identified differences that reduce the
decommissioning account risk for renewable energy projects compared to
oil and gas projects. In response to those differences, one commenter
said the history of OSW suggests a decreasing level of power generation
over time, another said production could be unreliable due to changing
weather and wind conditions, and another said the expected turbine life
is uncertain and that ``manufacturers do not warrant the turbines for a
30-year life.'' This risk of variable or even under-performance could
lead to reduced project revenue.
Response: BOEM seeks to balance offshore development while
protecting taxpayers by requiring financial assurance when there is a
greater risk. BOEM is finalizing the proposed provisions, which will
provide flexibility for lessees to fulfill their obligations while
ensuring that U.S. taxpayers are protected and lease obligations
completely fulfilled. BOEM's proposed approach seeks to target risk
without being overly burdensome. BOEM can adjust the amount and timing
of required financial assurance as it continues to monitor a lessee's
financial health.
Regarding hurricanes and other weather risks, these have been
incorporated into the most recent recommended practice for North
American offshore wind turbines (Offshore Compliance Recommended
Practices: 2022 Edition (OCRP-1-2022)). In addition to the updated
design practices, projects may also have insurance, warranties, and/or
performance guarantees that mitigate the risk of unforeseen
circumstances. In the event of a turbine needing to be decommissioned
in an unforeseen event, BOEM's financial assurance policies would
ensure that insurance or some other type of coverage would provide
funding for decommissioning or that significant revenue potential still
exists on the lease so that a lessee would be incentivized to repair or
replace the damaged turbine to continue operations.
Comment: A commenter expressed concern that if a company were to go
out of business (i.e., the developer file for bankruptcy prior to the
end of the lease term) without providing decommissioning costs upfront,
the decommissioning account may not be fully funded. A few commenters
said this could result in decommissioning costs falling to taxpayers or
ratepayers. Some commenters urged BOEM to require full decommissioning
funds before construction begins. A commenter encouraged BOEM to
consider a requirement to fully fund decommissioning at an earlier
stage in the project life, particularly because this scenario could
cause safety issues for mariners. For example, ``[o]ne fisherman in
California discussed that on the West Coast most activities are bottom
fishing activities, requiring the use of trawling and other equipment.
As a result, when developers drape cables and transmission lines on the
ocean floor, these fishermen cannot fish at all so long as the
equipment is in the water. If developers were to simply cut these lines
and leave them at the bottom of the ocean floor, this would pose a
safety hazard to these fishermen.'' The commenter recommended that
``BOEM revisit the incremental funding model and instead ensure that
developers have adequate funds to decommission a structure when the
structure is introduced into the ocean. This will give other small
business ocean users certainty that the developer will have the ability
to remove the structure if and when it becomes necessary to do so.''
Response: BOEM will regularly monitor incremental funding of the
decommissioning account. If BOEM determines that the amounts have
changed or the funding needs to be completed sooner, BOEM reserves the
right to update the funding amount and schedule. The proposed
amendments seek to balance encouraging development while protecting
taxpayers by requiring financial assurance when there is a greater
risk. BOEM is finalizing the proposed provisions which will provide
flexibility for lessees to fulfill their obligations.
Comment: A commenter asked BOEM to explain its process should a
facility require decommissioning due to unforeseen circumstances when
financial assurances for decommissioning do not cover the actual cost.
Response: BOEM would seek performance of decommissioning by the
current lessee(s) under the applicable regulations. Lessee(s) are still
liable for decommissioning regardless of the status of financial
assurance, and BOEM evaluates the financial strength of lessees on a
continual basis.
Comment: In response to BOEM's discussion of differences between
the renewable energy sector and the oil and gas sector, a commenter
said the history of OSW does not suggest a consistent level of power
would be generated over time, rather a reduction of perhaps 4.5 percent
per year is more realistic. Additionally, the commenter stated that
``no one knows what a reasonable lifetime for these turbines will be--
the manufacturers do not warrant the turbines for a 30-year life . . .
if the capacity is reduced due to operational difficulties, so will be
the revenue collected.'' Another commenter said that BOEM should
recognize that OSW production is unreliable due to unreliable weather
and wind conditions, so developers cannot guarantee consistent
revenues. The commenter cited multiple years where OSW farms in Europe
faced ``wind-droughts.'' The commenter also stated that PPA's are only
a reliable revenue source when developers are able to
[[Page 42637]]
deliver power. Similarly, another commenter discussed current power
purchase agreements that developers want to re-negotiate due to
unforeseen increases in project costs that make current rates
economically unfeasible. The commenter asked how developers operating
at a loss could accurately predict decommissioning costs.
Response: BOEM will consider the operational experience and
profitability of each project when assessing the need for financial
assurance. This evaluation will occur at least annually, which will
allow for performance reduction and weather variations to be
considered. BOEM acknowledges several PPAs are being re-negotiated due
to increases in project costs, but those costs are mainly related to
construction and installation, not operations. Once a project is
operational, the revenues are expected to exceed the operational costs,
even with the current PPA price levels.
Comment: A commenter stated that ``with developers already alleging
that projects will suffer losses at currently contracted rates'' it is
not likely that ``if a lessee became insolvent during its commercial
operations period, it would likely be able to transfer a functioning
OCS renewable energy facility to a solvent entity because the revenues
would be expected to exceed operating costs.'' Additionally, they
stated that ``[t]he US taxpayer should not be responsible for the
shortfalls of OSW companies, nor should the US commercial fishing
industry suffer the consequences if funds fall short of removing all
project components.''
Response: BOEM acknowledges several PPAs are being re-negotiated
due to increases in project costs and notes that these negotiations are
occurring prior to construction and installation. Once a project is
installed and operational, the revenues are expected to exceed the
operational costs, even with the current PPA price levels. If a lessee
became insolvent during commercial operations, the project itself could
still be profitable, therefore, BOEM considers it likely that another
entity would purchase it and continue its operations. BOEM seeks to
protect the taxpayer from any costs associated with offshore
development and will conduct at a minimum, an annual financial review
of lessees and offshore projects to ensure the continued financial
strength and economic viability.
(e) Sec. 585.527 Other financial assurance provisions--credit
ratings.
Comment: One commenter said a credit rating from a nationally
recognized statistical rating organization (NRSRO) would be more
reliable than BOEM's current assessment of financial strength. Another
commenter supported the use of public and proxy credit ratings to
determine the need for financial assurance, and investment grade credit
ratings to meet financial assurance requirements. One commenter
preferred the use of NRSRO credit ratings, which are determined on a
forward-looking basis opposed to the current backward-looking
assessment.
A commenter stated that the viability of switching to an external
credit rating depends on the number and source of ratings.
Additionally, the commenter said that BOEM must consider the minimum
acceptable rating and the impacts of a downgrade. A commenter stated
that a minimum credit rating should not be the only method for
financial assurance. The commenter suggested that BOEM maintain a
flexible approach for financial assurance through a combination of
credit ratings review and other factors, such as audited financial
statements.
Response: BOEM is requiring an investment grade credit rating from
an NRSRO (Sec. 585.527(a)) or an equivalent proxy credit rating
determined by BOEM using a credit model (Sec. 585.527(b)). A downgrade
in credit rating or proxy credit rating would require the lessee to
provide a separate form of financial assurance for the lease and result
in financial assurance demands to cover the cost of decommissioning.
BOEM's use of NRSRO credit ratings and proxy credit ratings is a
flexible approach and incorporates other factors such as audited
financial statements.
Comment: A commenter preferred the use of NSRSO credit ratings on a
forward-looking basis as opposed to the current backwards-looking
assessment, but noted the approach has limitations. The commenter said
BOEM should not act as a proxy to the rating agencies, because BOEM has
a conflict of interest and lacks the necessary expertise. Additionally,
the commenter asked how BOEM would respond to material changes in a
guarantor's financial situation.
Response: When a proxy credit rating is needed, BOEM will use a
credit model that considers the same factors as a credit rating issued
by an NRSRO. If material changes cause a guarantor to fall below an
investment grade credit rating, the lessee would need to provide a
separate form of financial assurance for the lease.
(f) Sec. 585.527 Other financial assurance provisions--joint and
several liability.
Comment: Multiple commenters said joint and several liability
should be an additional support if all current owners' default, not a
substitute or basis for reducing financial assurance requirements for
current owners. Another commenter expressed concern that basing the
need for, and amount of, financial assurance amounts on the financial
strength of co-lessees would undermine the security provided by joint
and several liability. A separate commenter requested that the final
rule ``require BOEM to use existing financial security (where BOEM is
the beneficiary) before looking to predecessors to meet the obligations
of a current owner in default . . . [and] require that predecessor
lessees and grantees be named as beneficiaries on security (``dual
obligee'' security) so that predecessors can use the security to
satisfy the current owner's obligations in the case of their default.''
Response: BOEM will not explicitly consider predecessor financial
strength to meet the financial assurance requirements. Current co-owner
financial strength will be considered since those entities would also
have joint and several liability for any obligations. BOEM is
finalizing, as proposed, that the financial health of lessees with
retained joint and several liability will not be evaluated when
determining a current lessee's financial responsibility. Dual-obligee
specific policies were not considered in the proposed rule; therefore,
no changes will be made to the final rule. BOEM plans to utilize any
existing financial security from current lessees in the event of a
default. There is no requirement that a predecessor be named as a
beneficiary although BOEM notes that a current lessee could make that a
condition of any sale or transfer.
3. What is the Department finalizing?
(a) Sec. 585.516 What are the financial assurance requirements for
each stage of my commercial lease?
BOEM is finalizing these regulations as proposed and will require
financial assurance prior to facility installation instead of at COP
approval. The updated regulations reflect that BOEM's financial
assurance requirements are intended to accrue on a timeline that
matches the increases in a project's liabilities.
(b) Sec. 585.520 What financial assurance must I provide when I
obtain my limited lease, ROW grant, or RUE grant?
BOEM is finalizing the revisions to lease-specific financial
assurance amounts as proposed. The updated calculation method will
better align the amount of financial assurance required with the
potential liability.
[[Page 42638]]
(c) Sec. 585.521 Do my financial assurance requirements change as
activities progress on my limited lease or grant?
BOEM is finalizing the revisions to lease-specific financial
assurance amounts as proposed. The updated calculation method will
better align the amount of financial assurance required with the
potential liability.
(d) Sec. 585.526 What instruments other than a surety bond may I
use to meet the financial assurance requirement?
BOEM is finalizing this section as proposed, which will provide
flexibility for lessees to fulfill their obligations. BOEM will
continue to require that all types of financial assurance instruments
provide adequate coverage matched with the lease and/or grant
obligations.
(e) Sec. 585.528 May I use a third-party guaranty to meet the
financial assurance requirement for lease or grant activities?
BOEM is finalizing this section as proposed, except as changed by
the Reorganization Rule. Also as discussed in the NPRM preamble at 88
FR 5988, the amendments as proposed would grant BOEM the discretion to
approve a third-party guaranty to cover only a specific amount. BOEM is
finalizing these amendments as well.
(f) Sec. 585.529 Can I use a lease- or grant-specific
decommissioning account to meet the financial assurance requirements
related to decommissioning?
BOEM is finalizing the proposed revisions to allow decommissioning
trust accounts to be incrementally funded pursuant to a BOEM-approved
schedule, while reserving the right to modify the amount of financial
assurance if circumstances change. BOEM's approach seeks to reduce risk
without being overly burdensome and to treat offshore lessees fairly,
equitably, and with transparency, while also recognizing that offshore
lessees and projects are not identical. BOEM will regularly monitor
each lessee's financial health and can adjust the amount and timing of
required financial assurance as needed.
In response to comments regarding the potential for U.S. taxpayers
being forced to pay for decommissioning due to bankruptcies and/or
other unforeseen circumstances, BOEM seeks to maintain a balance
between protecting the taxpayer from costs associated with development
on the OCS and not being overly burdensome. BOEM acknowledges there are
risks to offshore renewable energy projects and that some of these
risks are similar to offshore oil and gas while others are distinct.
For both types of projects, BOEM reserves the right to require
financial assurance at any point, should it be deemed necessary, and
actively monitors risks associated with all offshore development. This
approach allows BOEM to take project-specific conditions into account
when determining what kind of decommissioning account is appropriate
for a particular project. BOEM may, for example, consider the duration
of executed PPAs or offshore renewable energy credits, and require that
a decommissioning account be fully funded before the expiration of such
benefits.
(g) Sec. 585.527 May I demonstrate financial strength and
reliability to meet the financial assurance requirement for lease or
grant activities?
BOEM has finalized the use of credit ratings issued by an NRSRO in
the final rule based upon its determination that an investment grade
credit rating or equivalent proxy credit rating provides BOEM
sufficient protection. BOEM is also requiring third-party guarantors to
meet the same investment grade rating requirements to provide a third-
party guaranty. Material changes in a lessee's or guarantor's financial
situation that cause the entity to fall below an investment grade
credit rating or proxy credit rating will require them to provide BOEM
with alternative financial assurance.
BOEM will also evaluate financial strength requirements based on
the financial strength and reliability of the current lessee(s), even
if there is a predecessor that is jointly and severally liable. The
majority of comments on this concept were in support of this approach.
H. Sec. Sec. 285.810-285.812 Safety Management Systems (SMS)
1. What did the Department propose?
(a) Clarifying safety management system regulations (Sec. Sec.
285.810-285.812).
The proposed rule would clarify the information requirements for
safety management systems (SMS). It proposed to add a provision to
incentivize lessees and grantees to obtain a safety management
certification from recognized accreditation organizations to reduce the
frequency and intensity of regulatory oversight activities. It would
clarify the scope of work that requires a functioning safety management
system and added two safety reporting requirements. The Department
would be able to request the certification report from the accredited
organization in lieu of requiring additional audits.
Existing regulations require a lessee to conduct its operations
safely and to provide BOEM a description of its SMS, usually at the COP
stage. The proposed changes to Sec. Sec. 585.810 and 285.810 were
intended to clarify that a lessee or grantee must use an SMS when
conducting any activity pursuant to a lease or grant, even prior to SMS
submission to the Department, and would specify the contents of an SMS.
The proposed rule would require lessees or grantees to submit their SMS
to the Department with their COP, for SAP- and GAP-approved facilities,
and activities that the Department deems to be complex and significant.
The proposed SMS contents are consistent with industry standard safety
practices and with the guidance BSEE currently provides lessees and
grantees. Therefore, the Department does not expect these proposed SMS
changes to increase the burden of compliance on lessees and grantees.
(b) Why the Existing Regulations Should Be Updated.
OCS wind lessees and contractors have informally asked the
Department to clarify its expectations regarding SMS standards. The
rule would address those inquiries, incentivize SMS certification from
a recognized accreditation organization, add two safety reporting
requirements, and clarify that lessees and grantees would be required
to have and use an SMS for all OCS activities undertaken pursuant to a
lease or grant from site assessment through decommissioning.
The Department would implement a performance-based approach that
would promote flexibility in determining the best way to ensure the
safety of personnel on and near OCS renewable energy facilities during
activities covered by the SMS. The SMS changes are consistent with
industry's safety management best practices. The rule would allow a
lessee or grantee to adopt U.S. and international workplace health and
safety standards as its SMS framework.
Upon SMS receipt, the Department would engage with the lessee or
grantee to understand what risks the safety system is designed to
mitigate and how the system would function. The rule would provide
transparency regarding the types of information that the Department
considers necessary in a satisfactory SMS and would clarify that the
Department expects the lessee or grantee to design, implement, and
maintain the SMS according to generally accepted standard practices
such as those in API RP 75 (4th ed.), American National Standards
Institute (ANSI), Z10, and ISO 45001.
[[Page 42639]]
Clarification of necessary SMS information would help prospective OCS
renewable energy developers understand the Department's SMS
expectations.
The rule would add two reporting requirements. One report would
require an annual summary of how the SMS performed, normalized to work
hours and energy generation. This report would allow the Department to
verify SMS functionality and track continual improvements. The second
would be a triannual report summarizing the results of the most recent
SMS audit, the corrective actions implemented, and a description of any
changes made to the SMS since the prior report. Data from these reports
could be used to generate annual industry-wide comparisons of safety
performance.
Finally, the rule would provide that a lessee must have a
functional SMS before beginning any activity on the OCS pursuant to a
lease, and must use its SMS for all such activities, including site
assessment work. This would clarify the Department's expectations
regarding the stages at which an SMS must be functional and used,
including prior to the SAP, COP, or GAP.
SMS engagement with the lessee or grantees will focus on risk
identification and how the safety system is designed to reduce or
mitigate those risks to people, property, and the environment. The
proposed rule would define what the Department considers necessary in a
satisfactory SMS and would clarify that the Department expects the
lessee or grantee to design, implement, and maintain the SMS according
to accepted standard practices. A lessee or grantee whose SMS has been
certified would be eligible for streamlined oversight in recognition of
the increased rigor in the development and implementation of its SMS.
While such certifications would not be required and cannot guarantee
streamlined oversight in all instances, the Department anticipates that
most lessees and grantees would pursue certification as a best
practice.
2. What are the key public comments?
Comment: Multiple commenters expressed support for the proposed
shift to performance-based approaches for SMS, particularly related to
incentives for obtaining certification or accreditation for SMS,
streamlined oversight, clearer safety expectations, coordination of
enforcement within the Department, requirements for more detail to be
included in the SMS, and reporting requirements to allow comparisons of
safety industry-wide.
Response: BSEE supports the continued focus on performance-based
approach to SMS. BSEE is continually evaluating improvements to the
performance-based approach that have been integrated into this
rulemaking and additional improvements may also be considered in future
rulemakings.
Comment: A commenter expressed concerns that the proposal could
reduce the frequency and intensity of regulatory oversight on safety
issues and requested that the Department share any information related
to requirements for Contingency Plans for potential catastrophic events
at OSW development sites.
Response: Regulatory oversight ensuring the safety of offshore
workers and responsible environmental stewardship of offshore wind
activities is a primary focus of BSEE and these SMS regulations reflect
this focus. Section 285.812(b) provides for ``regular demonstration''
that the SMS is used and implemented effectively via annual activity
reports to BSEE and triannual reports summarizing the lessees or
grantees most recent SMS audit results, including corrective actions,
and an updated description of the lessees or grantees SMS highlighting
changes made since the last submission. With regard to potential
catastrophic events, BSEE requires the development and functionality of
Emergency Response Procedures in Sec. 285.810(c) and the proposed
Sec. 285.812.
Comment: Several commenters stated that safety programs and
reports, including information about oil or fluid leaks, should be made
available to the public. Some commenters remarked that oil or other
fluid leaks, in particular, must be made available to the public
immediately, and especially to the fishing industry to avoid
inadvertent harvesting of product(s) that may be harmful to consume.
Other commenters asserted that the Department should require an annual
summary of safety performance data covering all site assessment,
construction, operations, or decommissioning activities; and a report
summarizing the results of the most recent SMS audit that describes
corrective actions and any SMS changes made.
Response: The U.S. Coast Guard requires oil spill reporting through
the National Response Center and makes the information available to the
public at nrc.uscg.mil. BSEE will require safety performance data be
submitted to BSEE through proposed Sec. 285.812(b)(1). BSEE plans to
publish combined data on a regular basis.
Comment: Multiple commenters suggested that the Department clarify
that the SMS also apply to the safety of mariners, including fishermen,
within and near an OSW facility. Several commenters requested
clarification on SMS scope, review, approval, certification standards,
definitions, submissions, and oversight roles.
Response: BSEE recognizes the importance of consistent safety
programs and risk mitigations and their potential impacts to the
fishing and recreation industries, and how they influence performance-
based regulatory programs. BSEE considers environmental safety to be
within the scope of an SMS. While the SMS regulations themselves do not
apply to mariners, including fishermen, the intent of the SMS
regulations are to ensure the safety of personnel or anyone else near
or on the facilities.
Regarding comments seeking clarification on SMS generally, BSEE has
provided guidance to the industry related to these comments in Safety
Management System Expectations for Renewable Energy Companies Operating
on the OCS, which is posted on the BSEE website at https://www.bsee.gov/technical-presentations/ooc-presentation-sms-in-ocs-renewable-projects-may-13. This guidance includes information about
submissions, frameworks, and reviews.
Comment: Several commenters stated that the Department should
protect workers and workers' rights by requiring Labor Peace Agreements
(LPAs) for operations and maintenance workers as a condition of all
renewable OSW leases and ensure developer commitments do not
discriminate or retaliate against workers or contractors who raise
health and safety concerns. One commenter provided background
information to show the importance of improving workers' rights,
stating that in the construction industry alone, union worksites have
31% fewer health and safety violations. The commenter asserted that
without Department action, operations and maintenance workers would
have few protections at either the State or Federal levels.
Response: While BOEM has jurisdiction over lease terms, BSEE agrees
that a positive safety culture includes the right to stop unsafe work
and that retaliation leads to a negative safety culture. To ensure the
safety of lessees and grantee personnel or anyone else on their
facilities, Sec. 285.810(a)(5) requires them to submit procedures as
part of the SMS for personnel or visitors to report unsafe work areas
or conditions to both the lessee, grantee, or designated operator and
BSEE. BSEE will verify workers have a means of reporting unsafe working
conditions. BSEE also offers a means of reporting unsafe working
conditions via the BSEE
[[Page 42640]]
Safety and Incident Investigations Division (SIID) Hotline: (877) 440-
0173 or (202) 208-5646. Section 285.813(b)(1) requires lessees to
provide a written report to BSEE of any injury in which a person is
unable to return to work or perform their normal duties the following
day.
Comment: A commenter discussed a third-party SMS, including
accreditation and upcoming revisions to a standards document, SEMS API
RP 75 (4th ed.), and suggested that the Department acknowledge this
document and recognize the commenter's program for accreditation as
suitable for SMS certification. Changes the commenter recommended to
the proposed rule include:
In proposed Sec. 585.811, include API RP 75 in the
parenthetical examples of acceptable health and safety standards and
modify the first sentence such that it reads: ``You are not required to
obtain a certificate that your SMS meets acceptable health and safety
standards (e.g., API RP 75, ANSI Z10, ISO 45001) from a recognized
accreditation organization (e.g., COS, ANAB).''
In the corresponding preamble, provide supporting
information in the preamble for proposed Sec. Sec. 585.810 through
585.812 supporting API RP 75 as an acceptable health and safety
standard, and recognize COS's accreditation program for ASP and COS's
SEMS certificate program as suitable for lessees or grantees to receive
incentives for their SMS.
Response: BSEE agrees that API RP 75 (4th ed.) is one acceptable
SMS framework standard and has included it as an example of an
acceptable standard in Sec. 285.811. This rulemaking does not specify
any recognized accreditation organization. BSEE has taken a
performance-based approach and declined to specify standard and
accreditation organizations at this point in time. The process
implemented here provides flexibility to both the lessee and BSEE.
Comment: Several commenters provided editorial revisions to the
language in the proposed rule related to shut-downs, new language to
define the contents of as-built submissions, and details included in
SMS descriptions in plans. One such example revises certain language in
Sec. 585.810(b)(5) from ``shut-down of one or more facilities'' to
``manual shut-down of one or more facilities for the preservation of
safety.''
Response: BSEE agrees that all conditions might not be available
while the COP is still in the approval process and that it will change
over time as the program matures. The objective of this requirement is
that lessees demonstrate an awareness of conditions that could lead to
a shutdown of one of more facilities and that they have in place
specific measures to control or mitigate risks. BSEE supports the
continued focus on performance-based approaches to Safety Management
Systems. BSEE is declining to update the regulations regarding as-
builts in this final rule. BSEE may issue an NTL to clarify the as-
built requirements or update the regulations in the future should
additional requirements be necessary. BSEE is declining to change the
language proposed limiting shutdown of facilities to only manual
shutdowns. Other types of shutdowns are critical for safety and should
be included in the SMS.
3. What is the Department finalizing?
(a) Sec. 285.810 When must I submit a Safety Management System
(SMS) and what must I include in my SMS?
The Department is finalizing this section, consistent with proposed
Sec. 585.810, with minor revisions. For added clarity, BSEE is
including items required in the SMS under paragraphs (a) through (f).
Additionally, BSEE is revising the language in paragraph (a)(1) to
clarify that the health and safety risk provisions in this paragraph
also apply to anyone ``engaged in lease activities.'' In paragraph
(a)(3), BSEE is clarifying that nationally or internationally
recognized standards are applicable to ensure the safety of the
activities covered by the SMS. BSEE is also making minor edits to this
section to apply the transfer of authority from BOEM to BSEE and make
corresponding corrections to regulation references.
Lessees and grantees are required to use a SMS for activities
conducted on the OCS to develop or operate a lease, from met buoy
placement and site assessment work through decommissioning, and to
provide the SMS to BSEE upon request. They must also submit a detailed
description of the SMS with their COP (as provided under Sec.
285.627(d)) and, when required, with their SAP (as provided in Sec.
285.614(b)) or GAP (as provided in Sec. 285.651).
An acceptable SMS must address how the lessee or grantee will
ensure the safety of their personnel or anyone else on their facilities
or engaged in lease activities, specific policies and strategies to
control risks, and methods that will be used to monitor the
implementation of the SMS and maintain the safety of activities covered
by the SMS, including management of change and stop work practices; and
procedures for personnel to report unsafe work conditions both to the
lessee, grantee, or their designated operator and to BSEE.
Additional SMS elements include remote monitoring, control, and
shutdown capabilities; emergency response procedures, fire suppression
equipment and how and when it will be used, as needed; how and when the
lessee or grantee will test its SMS; auditing of the SMS; testing of
critical SMS components including remote shutdown capabilities as well
as emergency response readiness; and required training for personnel
who conduct activities on the facilities and provision of knowledge and
skills to ensure that personnel perform duties safely for the duration
of activities.
(b) Sec. 285.811 Am I required to obtain a certification of my
SMS?
The Department is finalizing this regulation, consistent with
proposed Sec. 585.811. BSEE is revising this regulation to update the
transfer of authority from BOEM to BSEE for considering certifications
in determining the frequency and scope of SMS-related inspections under
this subpart, as well as the scope and nature of its oversight over any
audit-induced corrective actions. The final rule revises the list of
examples of acceptable health and safety standards to also include API
RP 75.
BSEE encourages lessees and grantees to obtain a certification for
their SMS to meet acceptable health and safety standards from a
recognized accreditation organization (e.g., ANSI Z10, API RP 75, ISO
45001). However, lessees and grantees are not required to obtain a
certification from such organizations. BSEE will nonetheless consider
such certification in determining the frequency and scope of SMS-
related inspections that it conducts under this subpart, as well as the
scope and nature of its oversight over any audit-induced corrective
actions.
(c) Sec. 285.812 How must I implement my SMS?
The Department is finalizing this regulation, consistent with
proposed Sec. 585.812.
This section requires that a lessee's or grant holder's SMS must be
functional before they begin and must remain functional while they
perform any activity on the OCS, from met buoy placement and site
assessment work to decommissioning, or for any activities described in
their approved SAP, COP, or GAP. Lessees and grant holders must
regularly demonstrate to BSEE that their SMS is being implemented
effectively by submitting annual and triennial reports to BSEE in
accordance with Sec. 285.110.
[[Page 42641]]
I. Inspections
1. What did the Department propose?
Existing regulations state that the Department, acting through BOEM
and BSEE, as applicable, will inspect facilities and vessels engaged in
renewable energy activities to verify compliance with applicable terms,
conditions, laws, and regulations, and to determine whether safety
equipment has been properly installed and operated. The existing
regulations that require the lessee to conduct self-inspections are
limited to inspections of structures, mooring systems, and monitoring
of corrosion protection. Changes in the proposed rule would expand the
scope of Department inspections to cover Critical Safety Systems and
Equipment.
(a) Why the Existing Regulations Should Be Updated.
OCSLA requires the Department to promulgate regulations to provide
for scheduled onsite inspection, at least once a year, of each facility
on the OCS (43 U.S.C. 1348(c)). Existing Department regulations require
BSEE to perform a scheduled onsite inspection of all renewable energy
facilities on the OCS and inspect all safety equipment designed to
prevent or ameliorate fires, spills, or other major accidents.
To ensure that the OCSLA mandate of an annual onsite inspection is
met, the Department is revising Sec. 285.824 to require the lessee to
conduct annual onsite self-inspections. The lessee would also be
required to maintain records of its self-inspections and to provide
these records to the Department upon request pursuant to Sec. 285.824.
This would make the lessee accountable for ensuring safety and
protection of the environment. In addition, the Department would retain
the ability to conduct inspections at any time.
This revision would allow the Department to focus resources on
conducting inspections, both scheduled and unscheduled, based on
criteria such as operational risk severity and probability, results of
the lessee required annual self-inspections, industry trends, incident
data, analytical data, safety management system implementation and
audits, and other observations. Collectively, these inputs provide
compliance-based, risk-based, and performance-based data that will
enable BSEE to tailor inspection scope, protocol, location, and
frequency leading to high value-added BSEE inspections of facilities,
vessels, and renewable energy operations.
This revision would also reduce logistical and human resource
burdens on the lessees by allowing them to schedule their annual self-
inspections with maximum efficiency by incorporating the inspections
into scheduled onsite activities.
2. What are the key public comments?
(a) Self-Inspection Requirements.
Comment: Several commenters stated that more clarity is needed
regarding which vessels would be subject to Department inspections; the
roles of BOEM, BSEE, USCG, and independent inspection companies
contracted by lessees to conduct inspections; the intensity and focus
of inspections; and how inspections would address operational safety,
environmental risk, and engineering.
Response: BSEE-led inspections are limited to vessels conducting
lease activities in Federal waters that occur either on the lease or an
associated easement. Both BSEE-led inspections and self-inspections
will focus on ensuring that lease activities are being conducted in
compliance with the regulations, which are written to provide
protections to human safety and the environment. As described above,
BSEE's analysis of compliance, risk, and performance data will enable
it to tailor its scheduled and unscheduled inspections, including
utilization of remote inspections, remote testing, witnessing, and
review of self-inspection, allowing for comprehensive oversight.
Comment: Approximately 20 commenters discussed self-inspection
requirements. Multiple commenters supported the proposal to allow
lessees to conduct self-inspections. One commenter remarked that
existing regulations limit self-inspections to structures, mooring
systems, and monitoring of corrosion protection. The commenter noted
that shifting inspection responsibility to the lessee would allow for
the Department to focus its resources on conducting inspections based
on designated criteria while reducing logistical and human resource
burdens on lessees.
Response: BSEE is committed to a performance-based inspection
framework that is tailored to the operation, developer, location, and
associated risk. BSEE agrees that self-inspections allow the Department
to better use limited resources and create operational efficiencies.
Comment: Multiple commenters opposed the proposal to allow lessees
to conduct self-inspections, asserting that this could lead to safety
and environmental impact issues as the lessees would be primarily
responsible for conducting inspections, rather than BOEM and BSEE. The
commenters suggested that the agencies increase oversight, including
mandating inspections and self-inspections, providing public access to
report findings, and enforcing appropriate repercussions if lessees
fail to comply.
Response: BSEE is mandating self-inspections and will oversee the
self-inspection process. BSEE has determined that using compliance,
risk, and performance-based data to prioritize onsite BSEE inspection
frequency, remote inspections, remote testing witnessing, and review of
self-inspection will be more effective than BSEE onsite inspections
alone and will allow for more comprehensive oversight. Allowing self-
inspection to occur during maintenance visits reduces personnel risk
exposure and facility downtime. BSEE has determined that its inspection
approach will allow for proactive identification of hazardous
condition.
BSEE currently releases performance statistics on the BSEE website
(at https://www.bsee.gov/reporting-and-prevention/safety-and-environmental-management-systems) which track trends and provides
incidents analysis and safety and health performance for Oil and Gas
Operations from performance data gathered by BSEE as required under 30
CFR 250.1929. BSEE plans to release similar information for renewable
energy facilities based on the performance data collected under Sec.
285.812. Section 285.812 requires that key safety and operational
statistics are captured by the lessees and reported to BSEE. BSEE uses
this information to calculate a variety of annual, OCS-wide,
performance indices and to track industry performance. These indices
calculated by BSEE allow lessees to benchmark their performance against
aggregate industry data, as well for BSEE to provide the public with
OCS performance trends information.
Comment: Multiple commenters suggested that the Department should
consider remote condition monitoring using technology in conjunction
with targeted inspections to reduce the burden of yearly physical
inspections or should allow lessees to conduct less frequent
inspections coordinated with routine maintenance activities. Multiple
commenters provided revised text to include in the final rule
reflecting these changes. A commenter suggested that the Department
should allow lessees to provide justification for a self-inspection
period greater than one year.
Response: OCSLA requires an annual onsite inspection of all safety
equipment designed to prevent or ameliorate fires, spillages, or other
major accidents. Accordingly, BSEE lacks authority to
[[Page 42642]]
increase the time between inspections beyond one year. BSEE supports
the use of remote condition monitoring by lessees to inform their
productivity and compliance efforts. BSEE's inspection program
considers compliance, risk, and performance-based data, which may be
collected by remote monitoring technology, as well as the prescriptive
annual onsite inspection as required by the OCSLA.
Comment: A commenter suggested that the Department provide more
information on the efficacy of self-inspections in relation to
operational safety. A commenter stated that the Department should
provide clarity on what should be included in a comprehensive self-
inspection plan. The commenter remarked that the scope of self-
inspections is expanded in the proposed rule to include ``all safety
equipment designed to prevent or ameliorate fires, spillages, or other
major accidents,'' however, this phrase is not illustrated or explained
in the preamble to the rule. Further, under the proposed rule, a self-
inspection ``must include, but is not limited to,'' all such safety
equipment.
Response: BSEE has explained in 30 CFR 285.824 what the self-
inspection plans must include. BSEE is requiring that the self-
inspection plan development include risk-based evaluation and
identification of equipment designed to prevent or ameliorate fires,
spillages, or other major accidents. Requiring lessees to identify this
equipment, which is now defined as ``Critical Safety Systems and
Equipment'' in 30 CFR 285.112, allows for the regulatory requirements
to remain adaptive to new and emerging technologies. The ``but is not
limited to'' language allows lessees to add any equipment they deem
important to the self-inspection plan even if it may not meet the
definition of Critical Safety Systems and Equipment.
Comment: Some commenters stated that while they welcome SMS
certification from an accredited safety and environmental Conformity
Assessment Body (CAB), the Department should not rely on such third-
party certifications for assurance of SMS compliance in lieu of direct
inspection by the agencies. If BSEE does permit self-inspection, third-
party SMS certification from safety and environmental CABs should be
required, and the third-party inspection reports should be attested to,
filed with the agency, and made accessible to the public on the
agency's website.
Response: BSEE does not rely solely on third-party certifications
for assurance of SMS compliance, nor does it rely solely on self-
inspections for assurance of operational regulatory compliance. A
lessee SMS certification will be considered by BSEE during its
inspection data analysis, but it does not eliminate BSEE's ability to
conduct direct inspections. BSEE intends to publish combined data on
its website on a regular basis. BSEE is not requiring third-party SMS
certification, but third-party certification is encouraged. BSEE has
multiple ways to conduct safety oversight of projects, including self-
inspections, BSEE direct inspections, SMS third-party audits, BSEE led
SMS reviews, and remote inspections. BSEE has determined that utilizing
a performance-based approach to inspection frequency will be more
effective and allow for more comprehensive oversight. BSEE has
determined that the performance-based approach will allow for proactive
identification of hazardous conditions.
(b) Other Comments on Inspections.
Comment: Several commenters suggested that the Department provide
more clarity on the definition of ``facility,'' (e.g., single turbines
or the whole of the site layout offshore), the level and type of
inspections needed (consider allowing an independent inspection company
to perform work on behalf of a lessee), and the possibility of remote
inspections to reduce emissions and the overall exposure of industry
and agency personnel offshore.
Response: BSEE defines ``facility'' in Sec. 285.122 as an
installation that is permanently or temporarily attached to the seabed
of the OCS. Facilities include any structures; devices; appurtenances;
gathering, transmission, and distribution cables; pipelines; and
permanently moored vessels. Any group of OCS installations
interconnected with walkways, or any group of installations that
includes a central or primary installation with one or more satellite
or secondary installations, is often designed as a single facility.
BSEE may decide that the complexity of the installations justifies
their classification as separate facilities.
BSEE's inspection model includes the option of remote monitoring
technology as well as the prescriptive annual onsite inspection
required by the OCSLA. As performance-based inspection by lessees and
operators using remote inspection technology is found to be successful
in reducing risks to industry personnel, BSEE may consider future
changes to inspection activities.
Comment: A commenter stated that while the preamble language
discussing the proposed rules appears to indicate that the Department
would continue to conduct regular inspections, as written the proposed
rules do not require the Department to do so. The commenter recommended
that the Department's regulations provide some minimum frequency for
conducting onsite inspections to ensure adequate oversight of OCS
facilities.
Response: OCSLA requires an annual onsite inspection of all safety
equipment designed to prevent or ameliorate fires, spillages, or other
major incidents. BSEE's inspection model may include remote monitoring
technology as well as requiring the lessee to perform the prescriptive
annual onsite inspection as required by the OCSLA. The results of those
and other additional mandated inspections will be evaluated along with
lessee's performance record to determine the frequency of onsite
inspections by BSEE personnel. BSEE has determined that prescribing a
minimum frequency for BSEE inspections is not necessary at this time.
BSEE will use compliance, risk, and performance-based data to remain
adaptive as the renewable energy industry matures.
3. What is the Department finalizing?
(a) Sec. 285.820 Will BSEE conduct inspections?
This regulation was revised to state that BSEE may inspect OCS
facilities and any vessels engaged in activities authorized under this
part.
(b) Sec. 285.821 Will BSEE conduct scheduled and unscheduled
inspections?
BSEE is finalizing this section as proposed in the NPRM. BSEE may
conduct both scheduled and unscheduled inspections.
(c) Sec. 285.822 What must I do when BSEE conducts an inspection?
BSEE is finalizing this section as proposed in the NPRM. When BSEE
conducts an inspection, you must provide access to all facilities on
your lease (including your project easement) or grant, and any vessels
engaged in activities authorized under this part.
(d) Sec. 285.824 How must I conduct self-inspections?
BSEE is finalizing this section as proposed in the NPRM with small
modifications from the NPRM. As proposed in the NPRM, Sec. 285.824
requires the lessee to develop a comprehensive self-inspection plan
covering all of their facilities. The lessee must keep a copy of their
self-inspection plan wherever they keep their records and make it
available to BSEE upon request. This self-inspection plan must specify
how they will fulfill the requirement for an annual onsite inspection
of all Critical Safety Systems and Equipment.
[[Page 42643]]
The regulation also now requires lessees to conduct an onsite
inspection of each of their facilities at least once a year as proposed
in the NPRM. The inspection must include, but is not limited to, all
Critical Safety Systems and Equipment. The lessee must develop and
retain summary reports for all such inspections for each calendar year.
The summary report must note any failures of operability, any required
maintenance of Critical Safety Systems and Equipment, or required
replacement of the Critical Safety Systems and Equipment identified
during inspection. The lessee must also retain records of inspections
and summary reports for the previous 2 calendar years and make them
available to BSEE on request.
Under this section, lessees must include a list of facilities
inspected for structural condition and corrosion protection in their
annual reports as proposed in the NPRM.
(e) Sec. 285.830 What are my incident reporting requirements?
BSEE is finalizing this section as proposed in the NPRM. BSEE
requires that you must report all spills of oil or other liquid
pollutants in accordance with 30 CFR 250.187(d).
J. Other General Comments Related to Part 285
Comment: A few commenters suggested that the Department consider
appointing a Health and Safety Committee to provide consistency in
public access to information and provide input on CVA and engineering
reports.
Response: Forming a Health and Safety Committee is outside of the
scope of this rulemaking. BSEE notes the comment and may take it into
consideration in the event that BSEE initiates a relevant rulemaking
process in the future.
K. Other Proposed Changes in Part 585
1. What did the Department propose?
BOEM proposed additional regulatory changes that did not fall
within the eight previously discussed categories. Here is a short
description of those regulatory changes.
(a) BOEM's responsibilities under OCSLA.
Sec. 585.102 What are BOEM's responsibilities under this part?
Section 585.102(a) specifies that BOEM will authorize renewable
energy activities in accordance with OCSLA subsection 8(p)(4), as
enumerated in Sec. 585.102(a)(1) through (12). BOEM proposed amending
this regulation to clarify that none of the enumerated requirements is
intended to outweigh or supplant any other. The purpose of proposed
change was to clarify that BOEM takes all of these relevant factors
into consideration in planning its renewable energy program and that no
one factor or consideration, by itself, should outweigh the other
relevant considerations.
(b) Lease Structure.
Sec. 585.235 If I have a commercial lease, how long will my lease
remain in effect?
BOEM proposed to change the default commercial lease terms in Sec.
585.235 by merging the existing preliminary and site assessment terms
into one preliminary period; establishing new lease periods for COP
review and for design and construction that can vary in length based on
the duration of the COP review and the design and construction process;
and converting the existing 25-year operations term that commences at
COP approval into a 30-year operations period commencing at the
commercial operations date. These proposed changes recognized that most
lessees will not submit SAPs, account for the time required for permit
review and construction, and provide certainty to a lessee regarding
the operations period of its renewable energy project.
(c) Lease Segregation and Consolidation.
The following provisions are discussed under this section.
Sec. 585.410 When will my assignment result in a
segregated lease?
Sec. 585.411 How does an assignment affect the assignor's
liability?
Sec. 585.412 How does an assignment affect the assignee's
liability?
Sec. 585.413 How do I consolidate leases or grants?
BOEM has received requests from lessees to segregate single leases
into multiple leases, held by different subsidiaries, as well as to
consolidate multiple adjacent leases into a single lease. BOEM
regulations allow such segregations and consolidations, and the NPRM
proposed amendments that would expand upon the existing regulations at
Sec. 585.409 regarding assignments by establishing specific procedures
for lease segregation and consolidation.
(d) Civil Penalties.
Sec. 585.400 What happens if I fail to comply with this part?
The Department's renewable energy regulations do not explicitly
provide for assessing immediate civil penalties for violations that
constitute or constituted a threat of serious, irreparable, or
immediate harm or damage to life, property, or the marine, coastal, or
human environment, without notice and an opportunity to correct.
However, the authority for doing so is set forth in the OCSLA. The NPRM
proposed amendments to the Department's regulations to ensure that its
civil penalty regulations are coextensive with its statutory authority.
(e) Standardize Annual Rental Rates for Grants.
Sec. 585.508 What rent payments must I pay on ROW grants or RUE
grants associated with renewable energy projects?
The NPRM proposed to standardize the annual rental rate for most
grants. Under the proposed rule, BOEM would apply a $5 per acre annual
rental rate for both ROWs and RUEs, unless specified otherwise in the
grant.
(f) Technical Corrections and Clarifications.
Finally, the NPRM proposed numerous minor technical changes. These
technical revisions maintain consistency with proposed changes
elsewhere in the regulations, clarify ambiguities, correct technical
errors, and improve organization. Examples of proposed changes in this
category are discussed in the NPRM at 88 FR 5991.
The following are the specific sections affected by these changes:
Sec. 585.103 When may BOEM prescribe or approve departures from
the regulations in this part?
The proposed rule clarified that under 30 CFR 585.103(a)(1),
regulatory departures may be granted when necessary to facilitate
programmatic activities before, during and after lease termination.
Sec. 585.107 How do I show that I am qualified to be a lessee or
grant holder?
BOEM proposed a technical correction to paragraph (b) to reflect
that the Immigration and Naturalization Service no longer exists and to
avoid the need for future technical corrections in the event of another
change in the name of the relevant Federal immigration authority.
Sec. 585.110 How do I submit plans, applications, reports, or
notices required by this part?
BOEM proposed to eliminate its paper copy requirement and rely
primarily on electronic submissions. The paper requirement has proven
unwieldy for voluminous plan submittals that contain multiple
appendices and may be subject to multiple revisions before they are
finalized. However, BOEM proposed to reserve the authority to require
paper copies of certain documents (such as maps and charts) if
necessary.
The proposed rule also proposed eliminating the specific BOEM
mailing address to avoid the need for future
[[Page 42644]]
technical corrections if BOEM's mailing address changes again. Instead,
the mailing addresses for BOEM submissions would be listed for the
appropriate contacts on BOEM's website.
Sec. 585.417 When may BOEM order a suspension?
BOEM proposed to eliminate the paper copy requirement for this
regulation, consistent with its proposed changes to Sec. 585.110.
Sec. 585.607 How do I submit my SAP?
BOEM proposed to eliminate the paper copy requirement, consistent
with its proposed changes to Sec. 585.110.
Sec. 585.622 How do I submit my COP?
BOEM proposed to eliminate the paper copy requirement, consistent
with its proposed changes to Sec. 585.110.
Sec. 585.627 What information and certifications must I submit
with my COP to assist BOEM in complying with NEPA and other applicable
laws?
The proposed rule proposed to eliminate the paper copy requirement
consistent with BOEM's proposed changes to Sec. 585.110.
Sec. 585.642 How do I submit my GAP?
BOEM proposed to eliminate the paper copy requirement for this
regulation, consistent with its proposed changes to Sec. 585.110.
Sec. 585.701 What must I include in my Facility Design Report?
BOEM proposed to eliminate the paper copy requirement for this
regulation, consistent with its proposed changes to Sec. 585.110.
Sec. 585.702 What must I include in my Fabrication and
Installation Report?
BOEM proposed to eliminate the paper copy requirement for this
regulation, consistent with its proposed changes to Sec. 585.110.
Sec. 585.712 What are the CVA's or project engineer's reporting
requirements?
BOEM proposed to eliminate the paper copy requirement for this
regulation, consistent with its proposed changes to Sec. 585.110.
2. What are the key public comments?
(a) BOEM's responsibilities under OCSLA.
Comment: A commentor stated that BOEM exceeded its statutory
authority by making substantive changes to the statutory criteria for
lease suspension and cancellation. Therefore, the commenter said the
modernization rule should include regulatory changes to correct
differences between the current regulatory criteria for lease
suspension (Sec. 285.417) and cancellation (Sec. Sec. 585.422(b)(4)
and 285.437(b)(4)) and the statutory (OCSLA) criteria.
Response: This rulemaking is not proposing to change these
provisions because we view them as consistent with OCSLA.
Comment: A commenter expressed support for proposed revisions
related to the application of the section 8(p)(4) factors in Sec.
585.102. The commenter suggested that BOEM should provide clarity on
its approach to ``rationally'' balancing factors. The commenter also
requested clarification of specific terms and topics related to
prevention of waste factors, BOEM's compliance with law and
regulations, environmental benefits of OSW development, and the ability
of Tribal Nations to hold leases and grants, for consistency with
referenced opinions, articles, and regulations.
Response: With regard to Sec. 585.102 language, BOEM agrees that
clarifying the meaning of ``prevention of waste'' as well as the
incorporation of balancing into the text of this section provides
greater understanding of how the 12 factors in this section are
considered in BOEM's decision-making. The Secretary must consider
certain factors before approving activities under subsection 8(p).
Subsection 8(p)(4) of OCSLA requires only that the Secretary strike a
rational balance between Congress's enumerated goals, i.e., a variety
of uses of the OCS. In making this determination, the Secretary retains
wide discretion to weigh those goals as an application of her technical
expertise and policy judgment. Moreover, the Secretary has the
authority to define by regulation how the factors in subsection 8(p)(4)
are to be administered.
BOEM did not add clarifications about the ability of Tribal Nations
to hold leases and grants because the regulations are already clear
that nothing prohibits Tribal entities from participating in BOEM's
processes as state-chartered tribal corporations.
Comment: A commenter discussed that subsection 8(p)(4) of OCSLA
does not require BOEM to ensure that OCSLA's goals are achieved to a
particular degree, but instead requires that BOEM employ its discretion
to achieve a balance among the statute's several factors, considering
Congress's direction to authorize renewable energy development on the
OCS, leaving ``striking the proper balance . . . up to the Secretary of
the Interior,'' so long as that balance is rational. The commenter also
suggested that the final regulatory preamble should acknowledge the
caselaw supporting BOEM's proposed revision to Sec. 585.102(a), which
would provide that BOEM will ensure that any activities authorized in
this part are carried out in a manner that provides for and reaches a
rational balance among the 12 enumerated factors, none of which
inherently outweighs or supplants any other.
Response: The Department agrees that the proposed rule is strongly
rooted in and supported by Federal case law.\14\ As discussed in the
preamble, BOEM is amending these regulations to clarify that none of
the enumerated requirements is intended to outweigh or supplant any
other. The purpose of this change is to clarify that BOEM takes all of
these relevant factors into consideration in planning and administering
its renewable energy program and that no one factor or consideration,
by itself, should outweigh the other relevant considerations.
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\14\ See Commonwealth of Mass. v. Andrus, 594 F.2d 872, 889 (1st
Cir. 1979) (reading list of general policy priorities in former
section 3 of OCSLA to mean that ``where . . . sets of interests
conflict . . . , the Secretary must determine which interests must
give way, and to what degree, in order to achieve a proper
balance,'' a task that ``rules out a policy based on sacrificing one
interest to the other'').
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(b) Lease Structure.
Comment: As an alternative to a 30-year default operations period,
a commenter recommended the lessees be able to specify a duration for
the operations period for review and approval in the COP. The commenter
said the lessees must have certainty on extensions before investing in
facilities with longer lifetimes than the default operations period.
According to the commenter, the option to request an extension
following COP approval can be burdensome as it is likely to trigger new
NEPA reviews if not already part of the original PDE. The commenter
suggested the following revised language at 585.235(a)(4): ``Operations
period: A commercial lease has an operations period of 30 years, the
duration specified in the lease, or the duration included and approved
as part of your COP.'' Further, the commenter recommended revising
Sec. Sec. 585.626 through 585.639 to include details on what
information would be needed in the COP to justify an operational period
exceeding the default duration. Similarly, another commenter
recommended adding an option to extend the operating period to match
the asset's life, which would maximize economic benefit, rather than
risk retiring projects prematurely.
Another commenter said, ``585.235(b) could be clearer that an
extension of the operational period is not necessary if a longer
duration of operational period is already included and approved in the
COP.'' The commenter recommended the following revised language at
Sec. 585.235(b): ``You may request an
[[Page 42645]]
extension of any of the lease periods outlined in paragraph (a) of this
section for good cause or by including an alternative period in your
COP.'' Similarly, another commenter recommended the following textual
revision: ``You may request an extension of any of the lease periods
outlined in paragraph (a) of this section for good cause [add:
including if the project is designed and verified for a longer
duration].'' Given the likelihood of future technological advancements
and the potential for generating energy beyond 30 years, another
commenter said the proposed rule should guarantee extension of the
operations period if certain conditions are met, and BOEM should retain
the discretion to extend the operations period for good cause even if
the conditions are not met.
Response: BOEM agrees with the recommended revision to Sec.
585.235(a)(4): ``A commercial lease has an operations period of 35
years; or the duration specified in the lease; or the duration included
and approved as part of your COP.'' The revised text would facilitate
efficient technical and environmental reviews that match the
applicant's goals (reducing the likelihood of requiring future
supplemental environmental reviews) and the technical review could
ensure the proposed period is supported by the design life of the
proposed facilities and/or require conditions to safely extend their
operations.
Comment: For consistency, a commenter recommended that section
585.408 echo the concept laid out in BOEM's proposed paragraph at Sec.
585.235(d) that would allow the assignee to propose new lease periods.
The comment suggested adding ``(9) Any request to modify the default
lease schedule as a result of the assignment'' to the existing list of
8 pieces of information required for an assignment.
Response: BOEM agrees with this addition in light of the revisions
to Sec. 585.235(b) and has added similar language to the rule text at
Sec. 585.408(a).
Comment: A commenter stated that the proposed mandatory one-year
time frame for lessees to resolve issues identified as incomplete
within their COPs should be revised or removed as it may not be
feasible to resolve issues in this time, given that BOEM may take
several months to provide lessees with comments, and resolving issues
may require surveys, fieldwork, and modeling. Another commenter
suggested that BOEM establish a timeline for its initial COP review in
order to allow lessees to make revisions within the one-year time
frame.
Response: The proposed rule stated, ``The COP review period begins
when BOEM receives a COP from the lessee and ends upon COP approval,
disapproval, or approval with modifications . . . During the COP review
period, BOEM conducts the necessary reviews and consultations
associated with the COP. The lessee must resolve issues identified as
incomplete in the COP by BOEM within the first year of the COP review
period.'' BOEM recognizes the concerns raised by several commenters
with the requirement to ``resolve issues identified as incomplete in
the COP by BOEM within the first year of the COP review period.'' Upon
further consideration, BOEM is eliminating this provision because it is
too inflexible to accommodate the potential need for additional survey
campaigns to be completed. Further the proposed rule was not clear on
the consequences for failing to resolve issues and the phrasing
``resolve issues'' in itself is vague. BOEM will rely on its guidance
when considering whether a COP is ready for the issuance of an NOI and
BOEM can measure the maturity and completeness of the applications
before it in accordance its guidance.\15\
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\15\ See Information Needed for Issuance of a Notice of Intent
(NOI) Under the National Environmental Policy Act (NEPA) for a
Construction and Operations Plan (COP), (Aug. 2023), available at
https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/BOEM%20NOI%20Checklist.pdf.
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Comment: A commenter stated that BOEM should allow the sale of
electricity generated during commissioning and testing and this should
not trigger the beginning of the lease operation period to avoid
delayed energy production and to allow the lessee to use the full life
of the project. Related to Sec. 585.235(a)(4), a commenter recommended
replacing ``at the start of commercial operations'' with the following,
``The operations period begins when (i) the final constructed facility
necessary for production of electricity or other energy product has
completed installation and commissioning activities, and (ii) BSEE has
received and non-objected to documentation of critical system safety
commissioning and your PVR. The operations period will be deemed to
have started if BOEM reasonably determines that the facilities are
substantially complete and the PVR is unduly delayed.''
Response: BOEM and BSEE agree that the transmission and sale of
electricity generated during commissioning and testing should not
trigger the beginning of the lease operation period. Section
585.235(a)(4) has been revised to disconnect the beginning of the
operations period from the commencement of commercial operations of any
facility. Instead, the operations period commences when the
requirements of Sec. 285.637 are met for an entire project area
through the submission of final reports and records. In addition, BOEM
ensured the final rule accommodates phased development under Sec.
585.238 by requiring COPs that incorporate phased development to
propose lease period schedules under Sec. 585.235(c). This provision
requires a lessee to propose a lease period schedule for latter
phase(s) that could include an operations period that does not commence
when the requirements of 30 CFR 285.637 were only met for the first
project phase. Consequently, for a phased development COP, each phase
will have its own lease period schedule that is informed by the
lessee's request, BOEM's review of the request, and the resulting BOEM-
approved schedule. Consistent with the changes BOEM made to Sec.
585.235(a)(4) in response to these comments, BOEM also revised the end
point for the design and construction period at Sec. 585.235(a)(3)
which immediately precedes the operations period. Instead of ending the
design and construction period ``either when commercial operations
begin or at the expiration of the period set forth in the approved COP
as modified'' the final rule ends the design and construction period
``when the operations period begins'' as described in Sec.
585.235(a)(4).
(c) Lease Segregation and Consolidation.
Comment: A commenter stated that if lease changes are considered,
then impacts to risk management and financial assurance must be
considered for public protection. The commenter also said that the
potential impact on future licensing must be considered because the
current EIS process does not permit consideration of alternative sites
outside the one being considered and reducing the size of the lease
reduces the possible size and location alternatives.
Response: Segregating or merging leases should not have a direct
impact on the potential liability that the project poses to the
government, or the need for additional financial assurance to offset it
because the cost of decommissioning facilities, regardless of the size
of the lease area, is the key driver to the amount of financial
assurance that is required. However, BOEM retains at all times the
authority to review and adjust financial assurance, so if liability
[[Page 42646]]
impacts are identified, BOEM can increase the amount of financial
assurance required, if necessary. Therefore, BOEM did not make any
changes to rule provisions based on this comment.
Comment: A commenter expressed concern that lease period extensions
and schedule modifications of segregated or consolidated leases could
lead to decisions made without complete information, and suggested that
BOEM allow time within the schedule for review of complete information
prior to any approvals.
Response: Lease segregation or consolidation does not include the
guaranteed right to develop the resulting lease area. The scope of the
COP, which must include significant detail under BOEM's regulations,
informs BOEM's decision whether to approve development. If descriptions
of activities occurring in latter phases are incomplete, then BOEM
would require the submission of complete information before authorizing
those latter phases.
Comment: A few commenters provided editorial revision requests and
suggestions for the proposed rule language, including clearer
statements related to formal or informal agreements between entities,
effects of lease segregation on ongoing COP reviews, and revisions to
conditions for approved COPs. A commenter suggested that BOEM
explicitly allow the lessee to assign all or part of the lease area to
other entities. The commenter also suggested that the assignment
provision provide BOEM flexibility to ensure the proper terms and
conditions follow the relevant lease areas. Similarly, the commenter
recommended tailoring financial obligations of assignees and the
remaining obligations of assignors to track the scope of interest being
transferred. The commenter proposed a new Sec. 585.408(f), describing
BOEM's cooperation in these transfers.
Response: BOEM considered the editorial requests and suggestions
and decided to eliminate paragraph (b) altogether and added ``to one or
more parties'' to paragraph (a). The information in paragraph (b) is
duplicative of the existing Sec. 585.409, and what is already on Forms
BOEM-0003 and BOEM-0004. The addition of ``to one or more parties'' to
paragraph (a) was added because BOEM agreed with the comment requesting
clarity regarding assigning all or parts of a lease to other entities.
Both renewable and conventional leases may be held by multiple
entities. Assignment of part of a lease under this final rule results
in lease segregation. The ability to segregate a lease and assign
undivided interests simplifies issues like terms and conditions and
financial obligations. BOEM declined to incorporate the commenter's
proposed Sec. 585.408(f) because it was more appropriate for
incorporation into an internal process than a regulation. BOEM agreed
with comments clarifying that separate plan approvals may be issued for
a lease that becomes segregated and added Sec. 585.410(c) accordingly.
Comment: A commenter stated that BOEM exceeded its statutory
authority by making substantive changes to the statutory criteria for
lease suspension and cancellation.
Response: This rulemaking did not propose to change these
provisions because the Department views them as consistent with OCSLA.
Some suspension provisions were moved to BSEE-administered regulations
as part of the Reorganization Rule. For additional details refer to the
Section-by-Section Analysis for Sec. Sec. 585.417 and 285.417 of
Section V.
(d) Civil Penalties.
Comment: Several commenters expressed support for the proposed
paragraph at Sec. 585.400(f)(2) authorizing the Department to assess
civil penalties for certain violations. A commenter expressed that
``civil penalties. . . should be hard enough to prevent lessees from
accepting the existence of violations and simply taking the financial
hit.'' However, another commenter requested that the Department ``take
steps to ensure that the penalty is reserved for truly serious
circumstances and require agency notice at some reasonable time after
the assessment of the civil penalty and prior to the accrual of any
interest.''
Response: The paragraph of Sec. 585.400 that is referenced was
moved to Sec. Sec. 585.106 and 586.106, respectively due to the
issuance of ``Reorganization of Title 30--Renewable Energy and
Alternate Uses of Existing Facilities on the Outer Continental Shelf.''
The Department has significant experience and a process governing the
assessment of civil penalties under OCSLA that should adequately
address the comments received.
BOEM may invoke a civil penalty if an operator does not correct a
violation or if the violation posed a threat or harm to safety or the
environment. The maximum civil penalty is set by law, but BOEM
determines the amount for a specific violation based on its severity,
duration, and other factors. Lessees have the right to request informal
resolution of the decision from the Bureau and to file an appeal with
the Interior Board of Land Appeals.
(e) Standardize Annual Rental Rates for Grants.
Comment: One commenter requested that BOEM reconsider its proposal
[Sec. 585.508] to change the rental rate for ROW grants to match RUE
grants because the proposal could increase costs for ratepayers and
would not facilitate development.
Response: The final rule does not change rental rate dramatically.
BOEM believes the $5 per acre annual rate proposed remains modest when
viewed next to other project costs, and it will simplify the regulatory
treatment of ROWs, RUEs, and project easements.
(f) Technical Corrections and Clarifications.
Comment: A commenter expressed opposition to the proposed language
relating to regulatory departures at Sec. 585.103, stating that the
criteria were not well-defined and should only be applied in pre-
determined and narrow circumstances.
Response: Writing regulatory requirements will always be an
imperfect process. It is impossible to foresee the specific fact
scenario that will arise when the regulations are put into practice.
Departures are how the agency can account for unforeseen situations
where strict application of the regulations would be unfair,
impractical, unnecessary or even impossible (for example, unforeseen
contradictions in regulatory provisions). Drafting the departure
section to apply only to ``pre-determined and narrow circumstances''
would risk leaving the bureau and the regulated community unable to
respond to unforeseen circumstances outside such pre-determined and
narrow circumstances.
Comment: A commenter pointed to inconsistencies between Sec.
585.102(b) and Sec. 585.628(f), stating that it is unclear whether
BOEM can modify a COP, or approve a COP with conditions. The commenter
recommended revising Sec. 585.628(f) to clarify that BOEM does have
the ability to approve, disapprove, or approve a COP with conditions.
Another commenter discussed 43 U.S.C. 1334(a)(1) and (2) and
recommended that the language in the proposed rule preamble Section B.3
(Administration of Leases and Grants) be amended to match the language
of the statute.
Response: BOEM agrees that Sec. Sec. 585.102(b) and 585.628(f)
should use the same terminology and that ``approve a COP with
conditions'' should be the consistent phrase used in both regulations.
BOEM currently approves COPs with conditions and does not modify a
proposal or re-design a proposed project, thus the use of
[[Page 42647]]
``conditions'' both enhances clarity and is consistent with current
practices.
Comment: A commenter stated, ``BOEM does not have the authority
[under Sec. 585.103] to prescribe or approve deviations from its own
Federal consistency obligations under the CZMA, nor those of
leaseholders.'' Further, the commenter stated that BOEM does not have
authority to change the information that a leaseholder must submit for
State review, limit the rights of states to request additional
information, or reduce the time available for consistency review; this,
in addition to being outside of BOEM's statutory authority, would
impair the rights of states as third parties, and without such State
participation could not guarantee protection of the environment and the
public health and safety to the same degree as if there was no approved
departure.
Response: BOEM and BSEE are mindful of their obligations under the
Coastal Zone Management Act (CZMA). Nothing in the proposed rule will
impair the rights of states under this important authority. BOEM may
prescribe departures from its own regulations under the departure
authority in Sec. 585.103. However, BOEM's departure authority cannot
be used to exempt a lessee from other agencies' requirements. Last, we
agree that BOEM's and BSEE's regulations cannot amend the regulations
in 15 CFR part 930 and, therefore, it is BOEM's and BSEE's position
that the final rule does not affect any rights or obligations under the
CZMA.
Comment: A commenter said that under OCSLA, management of such
activities should consider economic, social, and environmental values
of renewable and non-renewable resources contained within the OCS.
Proper consideration must also be given to other uses of the seabed,
including fisheries navigation and marine productivity.
Response: BOEM appreciates this comment and endeavors to give
appropriate consideration of other uses of the seabed, including those
cited in the comment, in accordance with its responsibilities under
subsection 8(p)(4) of OCSLA and BOEM's implementing regulations at
Sec. 585.102. Further, nothing in the proposed rule and implemented in
the final rule will change the importance of these considerations in
BOEM's program.
Comment: A commenter provided several suggestions for technical
clarifications in Sec. 585.506 and provided the following
recommendations for revision: (1) clarify that operating fees would
also be owed when the developer obtains compensation for electricity
put onto the grid, (2) add a provision that operating fees ``for the
design and construction period be paid in a single lump sum within 90
days of the start of ``commercial operations'' based on the volume of
electricity sold prior to ``commercial operations'' as measured at the
delivery point for the project.''
Response: With regard to operating fee language, specifics
regarding the timing of when operating fees are incurred are governed
in the lease instrument. Current leases provide that operating fees are
incurred once the lessee delivers power to the grid for sale.
Comment: The commenter requested that the rule clarify the
definition of ``commercial activities.'' The commenter states that
``the proposed rule includes requirements to submit a new report, the
``Project Verification Report,'' at 30 CFR 585.704 and 585.708(a)(5).''
The commenter recommends formalizing the Project Verification Report
and consistently referring to it as such or ``PVR.'' The commenter also
asks the Department to formalize the name of the Critical Safety
Systems Commissioning Records (CSSCR) throughout the rule.
Response: The final rule defines ``commercial activities'' in
Sec. Sec. 285.112 and 585.113. Project verification report is
consistently spelled out in the final rule. CSSCR or a derivation of
such are only used in Sec. Sec. 285.637, 285.710, and 285.714 and BSEE
does not feel formalization is required.
3. What is the Department finalizing?
(a) BOEM's responsibilities under OCSLA.
Sec. 585.102 What are BOEM's responsibilities under this part?
The proposed rule clarified that none of the enumerated goals are
intended to outweigh or supplant any other. The final rule clarifies
further that BOEM needs to reach a rational balance among the goals to
the extent they conflict or are otherwise in tension The final rule
also clarifies that BOEM's responsibility to prevent waste on the OCS
includes the obligation to prevent economic waste and physical waste of
energy resources from sources other than oil and gas. This
clarification is supported by provisions in OCSLA regarding the meaning
of prevention of waste of hydrocarbons.\16\ The Reorganization Rule
added ``and approved plans'' to paragraph (b) to clarify that BOEM will
require compliance with approved plans as well as all applicable laws,
regulations, other requirements, and the terms of the lease.
---------------------------------------------------------------------------
\16\ e.g., 43 U.S.C. 1334(j)(1)(A).
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(a) Lease Structure.
Sec. 585.235 What are the lease periods for a commercial lease?
In Sec. 585.235 of the final rule, as in the NPRM, BOEM finalized
a significant change in the structure of future leases, which will be
divided into periods instead of terms. Commercial leases under the
final rule have a Preliminary Period of up to five years, during which
the lessee prepares and submits the COP. Submission of a COP triggers
the beginning of the COP Review Period, during which time BOEM conducts
its NEPA analysis and consultations.
If the COP is approved, this approval will begin the Design and
Construction Period, during which BSEE completes the FDR and FIR
review(s), and the lessee undertakes project construction.
Once the requirements of Sec. 285.637(a) are satisfied, the lease
begins the Operations Period. Previously, Sec. 285.637 provided that
commercial operations may commence 30 calendar days after ``the CVA or
project engineer has submitted to BOEM the final Fabrication and
Installation Report for the fabrication and installation review, as
provided in Sec. 585.708.'' However, Sec. 285.708(a)(5)(ii) allowed
the lessee to commence commercial operations 30 calendar days after
BSEE receives the CVA verification report unless BSEE raises objections
with the lessee during that time. This final rule remedies the
inconsistency by moving the provision from Sec. 285.708(a)(5)(ii) into
Sec. 285.637.
Section 285.637 has been revised to allow lessees to produce and
sell power prior to final FIR non-objection. The lessees and CVAs must
submit information to demonstrate that facilities installed prior to
first producing commercial power have been fabricated and installed and
that Critical Safety Systems and Equipment have been commissioned
properly. The lessee may continue to keep producing as long as the
lessee and CVA continue to submit information demonstrating the
additional facilities have been fabricated and installed and that
Critical Safety Systems and Equipment have been commissioned properly
as they come online. Finally, to improve organization, this final rule
has moved the prior Sec. 285.713 requirement to notify BSEE within 10
business days of starting commercial operations into Sec. 285.637.
The Operations Period lasts 35 years, unless a different duration
is specified in the lease, or unless a different duration is specified
in an approved COP. A 35-year default Operations Period is longer than
the previous default construction and operations
[[Page 42648]]
term, which was 25 years. This is appropriate based on the advancements
of technology that have occurred since the original renewable energy
regulations were published in 2009.
(b) Lease Segregation and Consolidation.
Sec. 585.410 When will my assignment result in a segregated lease?
Sec. 585.413 How do I consolidate leases or grants?
As proposed, the final rule explicitly provides for lease
segregation and consolidation in Sec. Sec. 585.410 and 585.413,
respectively. These sections clarify BOEM's procedures for segregating
and consolidating leases.
(c) Civil Penalties.
Sec. 585.106 What happens if I fail to comply with this part?
The previous Sec. 585.400 was moved to Sec. 585.106 by the
Reorganization Rule. The final rule specifies the civil penalty
authority of both BOEM, in Sec. 585.106, and BSEE, in Sec.
285.400(f).
(d) Standardize Annual Rental Rates for Grants.
Sec. 585.508 What rent payments must I pay on ROW grants or RUE
grants associated with renewable energy projects?
The final rule does not change the rental rate dramatically. BOEM
believes the proposed $5 per acre annual rate remains modest when
viewed next to other project costs, and it will simplify the regulatory
treatment of ROWs, RUEs, and project easements.
(e) Technical Corrections and Clarifications.
Sec. 585.225 What happens if BOEM accepts a bid?
Sec. 585.231 Will BOEM issue leases noncompetitively?
BOEM finalized many proposed technical changes, as identified in
the NPRM. In addition to these, BOEM includes a minor update for
issuing commercial leases competitively and non-competitively,
eliminating the requirement to execute multiple paper copies of the
lease. When BOEM promulgated the regulations in 2009, BOEM anticipated
a process that would create three original versions of the document:
two to be held at BOEM and the third to be given to the lessee.
However, widespread adoption of electronic copies has made this process
obsolete, and the requirement to execute leases in triplicate is no
longer needed. Accordingly, we have updated the regulations to remove
this requirement. In Sec. 585.225(b), BOEM removed references to BOEM
sending three unsigned copies of the lease form to the provisional
winner and removed the provisional winner's obligation to execute three
copies. BOEM no longer needs to sign three copies, and BOEM will send
the new lessee an electronic version of the executed lease.
Corresponding changes were made in Sec. 585.231(h) for noncompetitive
leases.
Sec. 585.110 When must I notify BOEM of mergers, name changes, or
changes of business form?
The final rule also revises Sec. 285.110, as specified in the
Reorganization Rule (88 FR 6376), to require you to submit one
electronic copy of all plans, applications, reports, or notices to
BSEE. BSEE will inform you if it requires paper copies of specific
documents.
L. Potential Revisions to Regulations Governing Research Activities
1. What did the Department propose?
Sec. 585.239 Are there any other renewable energy research
activities that will be allowed on the OCS? [previously Sec. 585.238]
BOEM did not propose specific revisions to regulations governing
research activities but solicited comment on ``whether the lease
process for research activities in existing Sec. 585.238 warrants
amendment.'' BOEM stated that it was interested in comments on the
following: ``whether it should create a specific regulatory framework
for research leases and planning whether it should expand the criteria
for who can hold research leases; whether the Determination of No
Competitive Interest (DNCI) requirement can or should be relaxed for
research activities; and whether any other aspects of this section
deter OCS renewable energy research'' (88 FR 5991).
2. What are the key public comments?
There were no significant comments relevant to this section.
3. What is the Department finalizing?
BOEM did not materially update its regulations on the issuance of
research leases, though renumbering has moved the section from Sec.
585.238 to Sec. 585.239.
M. Potential Revisions to Regulations Governing Transmission
1. What did the Department propose?
Sec. 585.200 What rights are granted with a lease issued under
this part?
Subpart D--ROW and RUE Grants for Renewable Energy Activities.
BOEM did not propose specific revisions to regulations governing
transmission, however it recognized in the NPRM preamble the need to
minimize impacts to the environment and natural and cultural resources,
while maximizing the utility of land-based points of interconnection.
BOEM also noted that it was continuing efforts to explore a coordinated
approach to transmission. BOEM specifically solicited comment ``on the
types of regulatory changes that would be appropriate to better
accommodate these options and to minimize impacts to environmental,
natural, and cultural resources'' (88 FR 5991). Further, BOEM included
the following example ``should 30 CFR 585.200(b) be modified to allow
BOEM to encourage or require use of such options where they are
available and allow for full enjoyment of the lease? What approaches or
options should BOEM consider advancing in 30 CFR 585.200(b) to
facilitate interconnection for lessees, while minimize impacts to
important resources?''
2. What are the key public comments?
Comment: A commenter recommended requiring ``spatial separation
standards for submarine cables and renewable energy infrastructure, to
alleviate cable crowding, overlapping, and potential cable breakage
that may disrupt communication and energy supply, and damage to the
marine environment'' and spacing leases to allow for designated cable
corridors between lease areas.
Response: The appropriateness of spacing may be dependent on local
conditions and technologies employed. Therefore, this information is
more appropriate for guidance and technical standards than codifying in
regulations. BOEM published OSW cable spacing guidance in 2015, which
is available here: Offshore Wind Submarine Cable Spacing Guidance
[verbar] Bureau of Ocean Energy Management: https://www.boem.gov/newsroom/notes-stakeholders/offshore-wind-submarine-cable-spacing-guidance.
Comment: A commenter recommended aligning transmission policies
with State policy initiatives and RTO/ISO grid planning processes to
avoid delays.
Response: BOEM currently has the authority to issue a ROW/RUE Grant
either competitively, or non-competitively as described in Sec. Sec.
585.300-585.316, after coordinating and consulting with relevant
Federal agencies, the Governor of any affected State, and the executive
of any affected local government. BOEM must first determine if there is
competitive interest, which is accomplished by publishing a public
notice describing the parameters of the project, to give affected and
interested parties an opportunity to comment on the proposed grant
area. BOEM currently
[[Page 42649]]
has the authority to work with a State seeking a ROW/RUE grant for
purposes of transmission, and as the ROW would necessarily need to be
continued through State waters and land for the purpose of
interconnection to the grid, there is the need to align processes.
However, BOEM agrees that regulatory clarity is helpful in this
instance, and added clarifications to the final rule that includes a
discussion of how State, RTO/ISO, and Federal processes may be better
aligned.
Comment: A commenter recommended allowing more time for the
submission of GAPs ``upon a sufficient showing of good cause'' due to
the ``complexity of designing and planning shared transmission
solutions.''
Response: The final rule in Sec. 585.236(b) states, as proposed,
that the preliminary period may be extended if the requested extension
can be justified for ``good cause.''
3. What is the Department finalizing?
BOEM is continuing to develop and implement a planned approach to
transmission that includes the use of shared transmission
infrastructure and corridors, meshed systems, and the development of an
offshore grid, where appropriate. On September 19, 2023, DOE and BOEM
released An Action Plan for Offshore Wind Transmission Development in
the U.S. Atlantic Region (https://www.energy.gov/gdo/atlantic-offshore-wind-transmission-action-plan), which included a set of actions to
support offshore wind energy.
Sec. 585.203 With whom will BOEM consult before issuance of
leases?
Sec. 585.212 What is area identification?
BOEM agrees with the importance of a comprehensive and coordinated
spatial planning effort. Sections 585.203 and 585.212 identify what is
evaluated during area identification and with whom BOEM will consult
before the issuance of a lease. These two touchpoints are critical for
the review of other available offshore resources and the potential for
avoidance or minimization of impacts to these resources. BOEM plans to
increase internal coordination between programs and will investigate
potential guidance for renewable energy that could help mitigate
potential sand borrow resource area impacts from renewable energy
transmission and development.
Sec. 585.213 What information is included in the PSN?
Sec. 585.214 What information is included in the FSN?
In response to the suggestion to use bid credits to promote shared
transmission lines, BOEM will develop and propose any bidding credits
in the PSN, and later confirm the availability of those credits in the
FSN, which allows for comments and potential modification. BOEM might
offer such bidding credits in future lease sales when it deems
appropriate, however, this is beyond the scope of the current
rulemaking.
Sec. Sec. 585.300-585.316 ROW Grants and RUE Grants.
BOEM currently has the authority to issue a ROW/RUE grant either
competitively, or non-competitively, as described in subpart D,
Sec. Sec. 585.300 through 585.316, after coordinating and consulting
with relevant Federal agencies, the Governor of any affected State, and
the executive of any affected local government. BOEM must first
determine if there is competitive interest, which is accomplished by
publishing a public notice describing the parameters of the project, to
give affected and interested parties an opportunity to comment on the
proposed grant area. BOEM currently has the authority to work with a
State seeking a ROW/RUE grant for purposes of transmission, and as the
ROW would necessarily need to be continued through State waters and
land for the purpose of interconnection to the grid, there is the need
to align processes. However, BOEM agrees that regulatory clarity is
helpful in this instance, and has added language in Sec. 585.307(c),
which describes the process BOEM may use to consider transmission
projects initiated by states or ISO/RTOs where a ROW/RUE would be
required. This provision clarifies how BOEM can consider decisions by
the state/RTO/ISO in the determination of competitive interest.
Sec. 585.307 How will BOEM determine whether competitive interest
exists for ROW grants and RUE grants?
Under this section in the final rule, BOEM may consider a state's
or Regional Transmission Operator/Independent System Operator's process
that identifies a transmission project that needs a ROW and/or a RUE
grant to achieve its intended purpose. BOEM may determine that there is
no competitive interest that would be consistent with OCSLA's goal of
allowing the expeditious and orderly development of OCS energy
projects, if offering the ROW and/or RUE competitively could challenge
the viability of the transmission project intended to be located on
State submerged lands and the OCS (e.g., technical and economic
feasibility or practicality concerns, including significant delays, by
having different entities holding the right to develop the transmission
project in State submerged lands and the OCS).
In response to the comment recommending defining roles between
BOEM, DOE, FERC, and RTO/ISO, BOEM agrees that coordination among these
entities is critical to the transmission planning process and will
continue to take steps to further refine roles and responsibilities as
the industry continues to develop. Additionally, BOEM and FERC signed a
Memorandum of Understanding (MOU) on April 9, 2009. The purpose of this
MOU was to clarify jurisdictional understanding regarding renewable
energy projects in offshore waters on the OCS, in order to develop a
cohesive, streamlined process that would help accelerate the
development of wind, solar, and hydrokinetic (i.e., wave, tidal, and
ocean current) energy projects.
In response to commenters' suggestions of identifying buffer areas
around offshore lease areas for use by competitively bid transmission
development and offshore substations, BOEM does not believe that buffer
areas are required for this purpose as rights granted through leases
are non-exclusive provided other uses do not unreasonably interfere
with the lessee's activities.
N. General Comments and Responses
This section describes a summary of the general comments that
commenters have provided on the NPRM, in addition to those comments
classified elsewhere.
1. The Offshore Wind (OSW) Development Process
Comment: Some commenters expressed concern for, and opposition to,
streamlining BOEM's processes for OSW development. They said the
proposed rule will increase the risk of harm to the environment,
natural resources, and cultural resources near the Yurok Ancestral
Lands in order to expedite and lower the costs for OSW energy projects.
Commenters discussed impacts to the fishing industry. A commenter
stated the OSW process must be halted until a full review and analysis
ensures that OSW development will not destroy fisheries and marine
ecosystems. The commenter also discussed the lack of engagement with
the fishing industry and impacts on the fishing industry that the
commenter claims will be removed from fishing areas due to OSW
development. Another commenter discussed the comments from fishing
industry expressing concern with OSW planning processes under the
existing regulatory
[[Page 42650]]
framework which, according to the commenter, lease the health of the
marine environment and fishing industry to the OSW industry. The
commenter expressed frustration with BOEM favoring interests of the
regulated industry over those of the public and existing ocean users
who are impacted by BOEM's regulated activities and OSW energy
development.
Response: The Department acknowledges the opposing comments
received from the commenters and have finalized the proposed rule with
changes that take into account public feedback, as discussed further in
this document.
The comment states opposition to the rulemaking invoking potential
harms but does not indicate which revisions will have purported
negative effects or why. The final rule streamlines the Department's
process and creates efficiencies without increasing negative impacts on
fisheries and without increasing the risk of harm to the environment,
cultural resources, or Tribal ancestral lands. We strongly disagree
that this rule favors the interests of regulated industry over those of
the public or existing ocean users who are impacted by the Department's
regulated activities. The final rule does not streamline or reduce the
Department's consultation processes, environmental reviews, or
stakeholder engagement.
Comment: A commenter stated that OCSLA provides BOEM with room to
amend existing leases to incorporate an operating fee credit.
Specifically, the commenter noted that they are not aware of any
statutes or regulations that prevent BOEM from amending the existing
regulations at Sec. 585.506 to establish an operating fee credit that
could be used to reduce operating fee obligations. The commenter
remarked that providing for such an operating fee credit would
represent a logical outgrowth of BOEM's formalization of the multiple
factor auction format via the proposed rule and would be consistent
with the IRA's apprenticeship requirement for renewable energy
facilities.
Response: BOEM has not adopted modifications to the final rule that
would be required for the agency to amend existing leases to implement
operating fee credits. BOEM has not seen a need to expand its authority
such as would be needed to amend the leases as suggested--existing
authority can promote policy objectives via bidding credits and lease
stipulations. BOEM is currently incorporating the use of bidding
credits in its lease auction procedures and can choose to evaluate
individual projects on their workforce utilization as the projects are
proposed. However, BOEM has not made changes in the final rule to add
operating fee credits for employers meeting the IRA apprenticeship
requirements.
Comment: A commenter remarked that, except for the Safety
Management System (SMS) section, every section of the proposed rule is
designed to increase flexibility for developers without considering the
impact on other stakeholders. The commenter stated that, ``BOEM quotes
E.O. 14008 as justification for further streamlining the OSW process
for the benefit of developers.'' However, the commenter believed this
would ``be inconsistent with the April 6, 2023, E.O., Modernizing
Regulatory Review, which states, ``Public trust in the regulatory
process depends on protecting regulatory development from the risk or
appearance of disparate and undue influence,'' and that agencies
``shall incorporate'' in the development of regulatory agendas an
``expansion of public capacity for engaging in the rulemaking
process.'' The commenter stated that BOEM's proposed Renewable Energy
Modernization Rule does the opposite, by, for example, allowing
developers to submit a COP without proposed turbine locations, which
makes public input on various Alternatives difficult to impossible,
particularly as changing turbine locations materially affect the
``viability'' of other Alternatives. The commenter stated that BOEM has
not changed its process to increase the assurance of safety or
protection of commercial fisheries and species in its process. The
commenter stated further that BOEM has given deference to developers
even in creating a purpose and need statement for NEPA review,
consistently overridden cooperating agencies in favor of developer
generated ``science'' and other documents. Finally, the commenter
stated that this is inappropriate but is the clear trajectory of BOEM's
approach, furthered by the proposed rule.
Response: BOEM is deferring only the submission of deep borings
used for final engineering and design at every foundation location
until after project approval, when the positions approved by BOEM for
actual installation would be finalized. This is distinct from
``allowing developers to submit a COP without proposed turbine
locations.'' To the contrary, a COP will still need to include the
areas within the lease that are proposed for development, one or more
indicative layouts including proposed spacing between turbines, a
maximum number of positions and other significant details for
consideration by the public. This information provides the public with
sufficient detail to comment on areas to avoid, navigational safety
concerns with the proposed layout, and many other aspects. Further, as
part of the COP's environmental review under NEPA, the public is free
to describe impacts to stakeholders for BOEM's consideration, propose
one or more specific alternative turbine layouts, or provide other
relevant comments. Lastly, the purpose and need statements in BOEM's
environmental impact statements for COPs are consistent with applicable
NEPA law, which allows for an agency to consider the goals of the
applicant.
Comment: A commenter noted the need for rulemaking in terms of the
growing concerns related to OSW and the need to support communities,
like delivery of benefits to Tribes and stakeholders. The commenter
discussed Pacific Wind Lease Sale 1 where the commenter claimed that
successful bidders did not engage local Tribes to ensure equitable
development of OSW.
Response: The rulemaking process offers multiple opportunities for
BOEM and BSEE to listen and respond to Tribes' and other stakeholders'
concerns about OSW permitting and development. BOEM and BSEE encourage
early communication between parties interested in OSW development and
potentially impacted Tribal Nations. BOEM and BSEE are committed to an
open and transparent process and ensuring that Tribes have the
opportunity for meaningful participation. BOEM invited federally
recognized Tribes to consult on this rulemaking and held government-to-
government meetings with several Tribes that requested to meet with
BOEM leadership. Lessees are required to make reasonable efforts to
engage with local Tribes after lease issuance for direct conversations
about equitable development, and to report to BOEM on the status of
engagement and communicate how tribal input has been used in the
project. BOEM welcomes consultation at all stages of the authorization
process.
Comment: A few commenters supported the proposed amendments that
would align the NEPA and CZMA review processes and asked for
clarification or revisions regarding this change. A commenter asked
BOEM to clarify how this would apply to existing OSW projects in
different stages of the planning and reviewing process. A commenter
said that BOEM should outline a notification process to inform states
of whether a lessee intends to voluntarily submit a consistency
[[Page 42651]]
certification. The commenter also suggested that BOEM should ensure
that the Federal consistency application forwarded to states includes
the consistency certification and all necessary data and information. A
commenter suggested clarifying the preamble by stating that BOEM ``will
make the draft NEPA analysis available at the same time as the
submission of NDI [necessary data and information] for CZMA review, and
that the draft NEPA analysis functions as NDI in the review process.''
The commenter also agreed with BOEM that the amendment would implicate
the ``active application'' provision at 15 CFR 930.51(f), however, the
commenter recommended cross referencing Sec. 930.58(a) in the final
rule, as this is the relevant section of the CZMA for establishing the
Federal consistency review start date. The comment also suggested that
BOEM revise the amended language at Sec. 585.628(c) regarding
information requirements to apply to pre- and post- lease COPs, despite
the rare occurrence of an applicant submitting a COP prior to issuance
of a lease. Furthermore, the commenter stated that the Federal
consistency application materials sent to the State should include the
consistency certification, draft NEPA analysis, and all necessary data
and information.
Response: For projects that are already in the review process,
implementation questions will be addressed on a case-by-case basis, in
coordination with states and lessees. To avoid delays in the
application process, BOEM will encourage lessees who propose to
voluntarily submit consistency certifications to states to coordinate
with the State coastal management program at their earliest
convenience. If the activity requires a consistency review under 15 CFR
part 930, subpart D, the applicant will coordinate with BOEM and the
State coastal management program to ensure all of the necessary data
and information along with the consistency certification, as required
in 15 CFR 930.58(a), is submitted in a timely manner. Based on the
current proposed revisions, this would include, at a minimum, an
analysis of environmental factors listed by the State's coastal
management program. A State's coastal management program may utilize a
draft Programmatic NEPA analysis in the form of an EA or EIS; or use a
Determination of NEPA Adequacy as its source for the required
environmental analysis to conduct an adequate consistency review.
BOEM agrees that amending the language at Sec. 585.628(c)
regarding information requirements to apply to pre- and post- lease
COPs be held to the same necessary data and information requirements in
15 CFR 930.58(a), which would include the draft NEPA analysis (despite
how unlikely it is in practice that an applicant would submit a COP
prior to lease issuance). It is noted that, if the COP is submitted
post-lease, it would fall under the requirements of 15 CFR part 930,
subpart E, and the applicant would submit the necessary data and
information, along with the consistency certification to BOEM. BOEM
would ensure that all of the necessary data and information and
consistency certification are included in the application for the State
coastal management program to conduct an adequate consistency review.
Once it is determined that the application contains all of the required
information, BOEM would submit the application to the State for
consistency review.
Comment: A commenter recommended revising Sec. 585.210 to clarify
that the competitive lease process will include public meetings for
oral comment.
Response: BOEM sees public input as a critical component of the
safe and responsible development of offshore resources. Public
engagement and comment are an integral part of the leasing process.
BOEM strives to make meetings convenient and easily accessible to the
public. BOEM acknowledges the commenter's concerns and will continue to
plan meetings to provide the opportunity for public participation with
both virtual and in person meetings. Although this may not involve
opportunities for oral comment, those interested in commenting will
have opportunities to do so.
Comment: Three commenters requested extensions to the public
comment period for the NPRM, including:
A request for a 45-day extension due to the critical
importance of the regulations, the length and complexity of the
proposed rule and impacts on the fish and wildlife species that are
under State agency authority to manage.
A request for a 30-day extension given the scope and
magnitude of the rulemaking.
A request for an unspecified extension of the comment
period and withdrawal of the rule.
Response: BOEM published the NPRM entitled ``Renewable Energy
Modernization Rule'' on January 30, 2023, with a comment period of 60
days ending on March 31, 2023. In response to several requests to
extend the comment period, BOEM published a notice on March 30, 2023,
notifying interested parties that the comment period was being extended
an additional 30 days to a total of 90 days and ending on May 1, 2023.
Comment: A commenter suggested BOEM has a conflict of interest in
both developing potential OSW properties while also regulating the
development in a safe manner that includes the interests of the public
and developers. The commenter mentioned the distinction between BSEE's
regulation of operational safety of the projects but noted there should
also be a safety function that includes development and construction
safety as well.
Response: The Secretary has delegated authority to BSEE for safety
and environmental oversight and enforcement related to OSW, including
at the development, construction and operations stages of development.
Since the proposed rule was published for public comment, the
administration of the Department regulations related to OSW safety and
enforcement have now been transferred to BSEE.
We disagree that BOEM's role creates the conflict of interest, as
described in the comment. First, BOEM does not ``develop potential OSW
properties.'' Instead, its Mission Statement is to ``manage development
of U.S. Outer Continental Shelf energy, mineral, and geological
resources in an environmentally and economically responsible way.''
Responsible development means allowing access to the OCS for
development in a way that does not endanger safety, other ocean uses,
environmental resources, etc.
BSEE's role in the safety of projects is not confined to
operational safety. BSEE also has oversight of development,
construction, operation, and decommissioning.
Comment: A commenter expressed support for an addition to the
renewable energy modernization rule that allows the use of Federal
funds from lease auctions to further the goals of the DOE's Strategy to
Accelerate and Expand Domestic OSW Deployment and address challenges
with supply chains and workforce development.
Response: BOEM would need additional statutory authority to apply
Federal funds from lease auctions to other policy purposes, including
the advancement of worthy goals like the ones articulated in the
comment. Therefore, BOEM decided not to incorporate the commenter's
suggestion into the final rule.
[[Page 42652]]
Comment: A commenter opposed the proposed rule, stating that the
changes result in the ``elimination of important research, leaving data
gaps unfilled, and skipping robust scientific analysis in favor of
highly questionable assumptive choices'' that could impact fishing
industries and the health of the oceans and marine ecosystems.
Similarly, a commenter stated that draft EIS documents have decreased
in quality, containing such little analysis that there is no
distinction between Alternatives.
Response: The Department disagrees that any of the provisions in
the proposed rule would have the effects described. The comment fails
to describe how the rule might eliminate important research. BOEM and
BSEE fund research, and will continue to do so, and nothing in this
final rule is expected to impact the amount of important research
taking place. The comment says the final rule will leave data gaps
unfilled but does not say which of the changes being finalized here
would have that effect. The comment says the revised regulations will
skip robust scientific analysis in favor of highly questionable
assumptive choices, but nothing finalized in this rule would do that.
BOEM's NEPA reviews are extraordinarily time-intensive products that
occupy teams of subject matter experts, contractors, and other Federal
and State authorities. BOEM proposes numerous alternatives in each
document, in excess of what is required by law. BOEM disagrees with the
commenter's characterization of the documents that BOEM has prepared
under NEPA and notes that such comments are outside the scope of the
current rulemaking.
Comment: A few commenters suggested that BOEM include a domestic
supply chain requirement for construction materials for OSW projects
and should require a Step Certification document to ensure compliance
with supply chain requirements. The commenters suggested that BOEM has
authority to and should stipulate the use of American-produced
construction material in lease agreements and approvals for COPs to
ensure the maximum return to the government from the lease sale,
provide environmental benefits due to a reduced carbon footprint from
OSW development and potentially cleaner production processes, improve
national security, create jobs and support communities, and comply with
executive orders requiring Federal agencies to combat climate change.
The commenters suggested that if BOEM does not support the development
of a domestic supply chain, there could be delays in construction and
operations, a loss of jobs, and a lower financial return to the
government.
Response: BOEM is very interested in ensuring that the U.S. supply
chain is adequately developed and capable of cost-effectively serving
the needs of the U.S. OSW industry. The most important factor within
BOEM's control that can contribute to the supply chain is to facilitate
a reliable pipeline of OSW projects. BOEM strives to make suitable
offshore acreage available for this purpose, but it is also important
that the cost of OSW energy is low enough for states and utilities to
support it. This means balancing the desire to accelerate domestic
sourcing with controlling OSW development costs. Accordingly, BOEM has
investigated other methods of promoting the domestic supply chain, such
as bidding credits, over potentially more costly options, such as a
requirement to source materials domestically. However, we do not
believe it is appropriate to impose domestic sourcing requirements as
requested in this comment.
Comment: A commenter stated that BOEM should stipulate that lessees
must enter into PLAs that provide for skilled laborers, avoid labor
disputes, and increase efficiency for obtaining construction materials
and completing projects.
Response: BOEM strongly supports union labor and tools like project
labor agreements. This support has recently been reflected in leases,
which promote the use of PLAs. However, requiring the use of PLAs for
all projects is outside the scope of the current rulemaking.
Comment: A commenter suggested that BOEM use the regional ocean
planning process to address conflicts upfront and ensure informed
siting decisions that balance the needs of states, Federal agency
missions and objectives, ocean users, Tribal governments, communities,
and the Fishery Management Councils. The commenter suggested that BOEM
consider developing a coordination framework to allow government and
public coordination prior to the required public comment periods and
include not just Federal, Tribal, State(s), and local agencies, but
also ocean users, communities, and other potentially interested
parties. The commenter suggested that this coordination could aid in
efficiency of reviews and improve working relationships among all
parties.
Response: BOEM is an active member of several Regional Ocean
Partnerships (ROPs), including the Northeast Regional Ocean Council
(NROC), the Mid-Atlantic Council on the Ocean (MACO), and Pacific West
Coast Ocean Alliance (WCOA). These bodies serve as regional fora for
coordination, providing data and information via Ocean Data Portals,
and developing and communicating best practices for decision-making.
For example, NROC is drafting a set of best practices that can be
implemented in ocean permitting and management processes that enhance
stakeholder engagement, agency and interjurisdictional coordination,
the use of data and information, and regulatory pre-application
practices. ROPs also host efforts like the Regional Wildlife Science
Collaborative, a partnership among States, Federal agencies,
environmental groups and the OSW industry to coordinate science and
monitoring related to wildlife and OSW on the Atlantic coast. Regional
ocean planning is a key component of BOEM's intergovernmental
coordination and collaboration, and our ongoing stakeholder engagement
efforts. BOEM's participation in ROPs has resulted in enhanced
coordination among Federal, Tribal State, and stakeholders on ocean and
coastal issues. BOEM will continue to participate in ROPs to enhance
interjurisdictional coordination, provide additional opportunities to
engage stakeholders, ensure expertise and resources are being
leveraged, and utilize the regional ocean data portals.
2. Environmental Reviews and Evaluations
Comment: One commenter suggested that ``subsurface and airborne
monitoring for endangered, threatened, and protected species should be
required at all stages'' of OSW development.
Response: The Department's regulations do not require the lessee to
perform specific studies but instead requires the results of studies to
support submission of a plan. Specific methodologies to achieve these
goals have been detailed in guidance documents to lessees available on
BOEM's Guidance Portal under the Renewable Energy Guidance Tab at
https://www.boem.gov/about-boem/regulations-guidance/guidance-portal.
Appropriate monitoring methodologies are ordinarily developed on a
case-by-case basis as part of the environmental reviews and associated
consultations, such as ESA section 7 consultations with NMFS.
Comment: A commenter asserted that the proposed rule does not
adequately incorporate a rigorous environmental review process into the
renewable energy program planning process. Here, the commenter
suggested that an earlier NEPA analysis would be necessary to account
for the impacts of OSW
[[Page 42653]]
development on marine ecosystems. Further, the commenter asserted that
BOEM ``undertake a cumulative impacts analysis'' for at-risk species
before issuing leases. Similarly, a commenter asserted that a NEPA
analysis should be completed prior to finalization of the rule,
reasoning that small fishing industries and small coastal communities
would be impacted by the rule as it could disincentivize developers
from working with these businesses and communities and could fast-track
projects without full consideration of their impacts. Another commenter
asserted that BOEM has inadequately considered the impacts of marine
spatial planning on fishing communities. Here, the commenter argued
that BOEM's rationale against further NEPA analysis--that the four-
stage permitting system for offshore development ensures no
construction may take place ``prior to issuing a Constructions and
Operations Permit'' does not adequately justify BOEM's assertion that
NEPA analysis is not necessary.
Response: BOEM is not using this final rule to change its approach
to environmental reviews in the area identification process. BOEM's
existing area identification process does not require completion of an
EIS to analyze the potential impacts of building out OSW generation
facilities because identifying areas and holding a lease sale do not
constitute an irreversible and irretrievable commitment of resources.
BOEM does conduct extensive data collection and public engagement
during this process, but at the time lease areas are identified, no
project has been proposed, the technology used for any facilities that
may later be installed is not known, and the surveys that lessees
conduct in preparing a COP is not available. An EIS conducted under
such circumstances would need to be at a high level of generality,
would be highly speculative, likely would not provide adequate NEPA
analysis for the decision to approve a COP, and would result in the
need for an additional NEPA to be conducted at a later time.
Comment: A commenter requested a period of public comment on any
proposed EA prior to a final decision on the rule.
Response: BOEM conducted an initial NEPA analysis for the proposed
rulemaking and determined that the proposed rule met the criteria for
categorical exclusion under 43 CFR 46.210(i) of DOI's implementing NEPA
regulations. The regulations set forth in this rule are ``. . . of an
administrative, financial, legal, technical, or procedural nature.''
Comment: Multiple commenters stated that BOEM should conduct
regional studies or a Programmatic Environmental Impact Statement
(PEIS) to analyze the potential impacts of OSW development, including
along the West Coast of the United States and the Gulf of Maine.
Commenters stated that a regional PEIS completed at the early stages of
lease planning could help BOEM, developers, and reviewers better
understand cumulative impacts, improve the efficiency of the
environmental review process, provide opportunities for siting a wider
range of potential alternatives, speed up the permitting process, and
address potential conflicts early in the review process. A few
commenters suggested that the proposed rule should require that BOEM
conduct a PEIS before determining lease areas and should consider
socioeconomic impacts on coastal communities, an economic study of
fisheries, a fair market assessment of capital assets necessary for
commercial fishing activities, and impacts on upwelling, food web
productivity, and carbon capture. A commenter suggested that BOEM
develop a comprehensive regional plan for wind energy development on
the West Coast to describe collaborative actions and best practices
``to inform and guide Federal, State, Tribal, and Fishery Management
Council activities under existing authorities.''
Response: BOEM is supportive of PEISs, but also maintains that
timing and purpose are key considerations. Prior to the leasing stage,
BOEM collects and analyzes available data and information to delineate
areas of least conflict and conducts environmental reviews before
deciding whether a lease may be issued. BOEM is best equipped to
undertake an EIS analysis when BOEM has adequate information to inform
how leases in the area are likely to be developed based on a final
lease area size and location, including site-specific conditions.
BOEM is incorporating the latest in modeling science and technology
to examine potential impacts of leasing decisions in a holistic,
dynamic, and forward-looking way. To accomplish this, BOEM is working
with NOAA's National Centers for Coastal Ocean Science (NCCOS), to
synthesize and model collected ocean use, conservation, and fishing
data. BOEM has used and will continue to use this ocean planning tool
to help identify areas of the U.S. OCS with minimal conflicts, and to
inform the development of Call Areas and WEAs for public review and
comment prior to final designations, as a general practice. In
conjunction with the NCCOS modeling, BOEM is also funding the
Standardizing Integrated Ecosystem-Based Assessments (SIEBA) study,
which will create an ecosystem-based management (EBM) framework to help
us identify more ways to manage ocean resources in an ecologically and
economically responsible manner. Both the NCCOS modeling and the SIEBA
study provide BOEM with additional tools in its OSW energy planning and
leasing process.
Comment: A commenter asserted that the proposed rule ignores
requests for environmental studies.
Response: The final rule does not affect the manner in which BOEM
conducts environmental studies and reviews of the activities it
authorizes on the OCS. Also, the final rule does not authorize any
activities on the OCS. It should be noted that, through its
environmental studies program (ESP), BOEM funds millions of dollars in
research each year, much of it devoted to impacts associated with OSW
development. BOEM develops, funds, and manages rigorous scientific
research specifically to establish information needed for assessing and
managing environmental impacts of energy and mineral development on the
human, marine, and coastal environments. Mandated by section 20 of
OCSLA, the ESP is an indispensable requirement informing how BOEM
manages offshore oil and gas, offshore renewable energy, and the marine
minerals program for coastal restoration. The ESP has provided over $1
billion for research since its inception in 1973. Research covers
physical oceanography, atmospheric sciences, biology, protected
species, social sciences and economics, submerged cultural resources,
environmental fates and effects, oil spills, and more.
All OCS wind development is subject to environmental review. BOEM
is supportive of PEISs, but also maintains that timing and purpose are
key considerations. Prior to the leasing stage, BOEM collects and
analyzes available data and information to delineate areas of least
conflict and conducts environmental reviews before deciding whether a
lease may be issued. BOEM is best equipped to undertake an EIS analysis
when BOEM has adequate information to inform how leases in the area are
likely to be developed based on a final lease area size and location as
well as site-specific conditions.
Comment: A commenter stated that BOEM should ensure that adequate
information is developed through the
[[Page 42654]]
COP NEPA analysis ``for states to understand and review the coastal
effects of all design options, in order to maintain efficiencies within
the review process and avoid the need for supplemental consistency
review when final design decisions are made.''
Response: The final rule clarifies procedures for providing NEPA
analyses to states as part of the CZMA consistency review.
Comment: A commenter suggested BOEM revise Sec. 585.627 to clarify
that the requirements set out by this section are necessary to ensure
BOEM analyzes activities expected to significantly affect the
environment, including actions that are not within BOEM's siting
authority or jurisdiction.
Response: Most of the commenter's suggestions were accepted and
appropriate changes were made in reflection of the comments. BOEM also
made parallel edits to the relevant SAP regulations at Sec. 585.611(b)
and the relevant GAP regulations at Sec. 585.646(a) and (b) because
BOEM's plan requirements have parallel structures regarding NEPA. For
specific details, see discussion at Section V. Section-by-Section
Analysis, Sec. 585.627.
Comment: A commenter concluded that the proposed rule raises
multiple concerns about the protection of the marine ecosystem and
warrants NEPA review. A commenter stated that ESA consultation should
be reinitiated and asserted that BOEM has failed to rely on the best
available scientific data, particularly with respect to the critically
endangered North Atlantic right whale, and failed to include sufficient
measures to avoid, minimize, and mitigate the impacts to the point
where they are not likely to adversely affect this critically
endangered species.
Response: The final rule is of an administrative nature, does not
authorize any activity on the OCS and, therefore, is categorically
excluded from the need to prepare an Environmental Impact Statement.
ESA consultation for the promulgation of the final rule is unwarranted
because the final rule does not authorize any activities and,
therefore, the Department's action has no effect on threatened or
endangered species protected by the ESA.
Comment: A commenter said that BOEM should incorporate into the
proposed rule a requirement for a full EIS before BOEM decides on the
wind areas for potential leases to allow for meaningful input from the
public on the sites and potential alternative locations.
Response: BOEM disagrees that opportunities for meaningful input
are not available in BOEM's current area identification process,
consultations and repeated engagement with Federal agencies, Tribes,
State agencies, industries, and stakeholder groups. BOEM ordinarily
starts the process with a Request for Information with a comment
period, along with intense consultation with other Federal agencies,
Tribes, State and local governments at meetings that are open to the
public. During this time, the agency ordinarily also holds public and
private meetings with stakeholder groups and nongovernmental
organizations. BOEM's current policy is to also publish the area
identification in draft form for comment prior to publication of Wind
Energy Areas. This marks the end of the area identification process,
though BOEM continues stakeholder engagement and public outreach, and
lease areas often continue to be refined during the stages the follow,
which includes meetings related to a lease sale environmental
assessment, as well as the Proposed Sale Notice comment period.
Moreover, an EIS at the area identification stage of development
(which is not required) would be limited in several important ways.
Actual development would not take place for a significant time, meaning
the technology that would be used is likely to evolve--perhaps
dramatically--before facilities can be deployed. BOEM would not be able
to analyze the potential impacts of yet-to-be-specified (or maybe even
invented) technology. Further, a great deal of the project design is
dependent on site-specific data that cost tens of millions of dollars
to obtain. Such data are currently generated by lessees, who make these
investments with the hope of developing a project that will repay that
investment. Thus, the specificity and usefulness of an area
identification EIS would be limited, such that an additional EIS would
likely be required once the data were available and development more
imminent. BOEM seeks a maximally informed decision-making process
without unnecessarily repeating NEPA analyses.
Comment: A commenter stated that BOEM should maintain opportunities
for public comment and review in the final rule by ensuring that any
findings from deferred survey work that show environmental impacts are
sufficiently subject to public review and scrutiny.
Response: The final rule will allow lessees to defer some deep
borings to a later stage of development. However, this is not meant to
affect the level of public availability of information; only the timing
of when a subset of the geotechnical information is required to be
submitted. Further, the deferred information is not necessary to assess
environmental impacts or whether the facilities can be safely
installed. The partial deferral of geotechnical survey information is
more relevant to the technical design of the facility.
Comment: A commenter requested a public comment period and
preparation of an environmental analysis of the rulemaking before BOEM
decides whether to publish a final rule and what to include in it.
Response: A NEPA analysis is not required because the proposed rule
is covered by a categorical exclusion (see 43 CFR 46.205). The final
rule meets the criteria set forth at 43 CFR 46.210(i) for a
Departmental categorical exclusion and the Department has also
determined that the final rule does not involve any of the
extraordinary circumstances listed in 43 CFR 46.215 that would require
further analysis under NEPA. Therefore, a public comment period on a
NEPA analysis of the proposed rule will not be provided.
3. Procedural Matters
Comment: A commenter asserted that BOEM's definition of the
baseline scenario in the existing regulatory framework does not
consider the impacts to small fishing businesses and small coastal
communities and suggested that BOEM conduct a regulatory impact
analysis due to these potential impacts.
Asserting that Public Law 104-121, Title II, 110 Stat. 857 (1996),
requires BOEM to consider input from small businesses and entities,
another commenter suggested that the agency has not responded to
comments from these entities regarding the impact the proposal would
have on their businesses. The commenter asserted that BOEM must include
a response to written comments in any explanation or discussion
accompanying the final rule's publication in the Federal Register in
accordance with the Small Business Jobs Act of 2010. Here, the
commenter argued that the statutory regime requires BOEM to assess the
impact of its proposed rule on small businesses.
Response: The commenter references the Small Business Jobs Act of
2010; however, the Department assumes they intended to reference the
Regulatory Flexibility Act, which instructs agencies to assess how
their proposed regulations will directly affect the entities they
regulate. The potential indirect effects of existing regulations should
not be used as the basis to support or reject an agency's current
proposal. Commenters critical of the proposed rule based on the
Regulatory Flexibility Act argue
[[Page 42655]]
generally that the proposal either lacks provisions to adequately
safeguard secondarily affected small entities from baseline activity,
or that it falls short in doing so. However, they do not specifically
claim that any of the proposed provisions directly and unnecessarily
burden small, regulated entities.
The Department agrees that agencies should consistently monitor
both the immediate and indirect consequences of its regulatory
framework on small entities. Yet, the Department should not be
prevented from implementing necessary changes in some areas simply
because regulatory improvements might still be available in others.
Comment: Reasoning that the proposed rule constitutes a major
Federal action, and that the proposal carries financial risks to public
interest and potential environmental impacts, a commenter suggested
that the rule requires assessment under the Congressional Review Act.
Response: The Congressional Review Act (CRA), 5 U.S.C. 801-808,
establishes a mechanism to expedite congressional review of agency
rules. The CRA generally provides that, before a rule may take effect,
the bureau promulgating the rule must submit a rule report, including a
copy of the rule, to each House of the Congress and to the Comptroller
General of the United States (Comptroller General). The CRA applies
only to final rules, therefore, the NPRM was not submitted to Congress
or the Comptroller General under the CRA. The final rule will be
subject to the CRA and the Department will submit a rule report,
including a copy of the final rule, to each House of Congress and to
the Comptroller General.
Comment: A commenter recommended that BOEM maintain the more-
stringent alternative for anticipatory geotechnical investigations,
which has been removed from the proposed rule. The commenter stated
this alternative ``retains the requirement for boring at every turbine
location, while allowing these investigations to occur later in the
process'' and suggested that the alternative would partially increase
savings for the lessee or grant-holder, ``but not to the full extent
that would be saved under the proposed rule.''
Response: The commenter recommends the retention of the more
stringent alternative concerning geotechnical borings. This alternative
retains the requirement for borings at each turbine location but
proposes to postpone them to a later stage in the process. However, the
rationale behind the preference for this alternative is not outlined in
the comment. The Department observes that the proposed rule defaults to
this approach, and developers seeking greater flexibility must
demonstrate, subject to bureau approval, the rationale and suitability
for omitting certain investigations. Further information regarding
geotechnical and geophysical surveys is elaborated in section 3.3
above.
Lastly, the commenter advocates for the agency to continue its
evaluation of the costs and benefits associated with the rulemaking
beyond enactment. The Department concurs with the notion that
regulatory agencies should consistently monitor the effectiveness of
their regulations and revise them when deemed inadequate or excessively
burdensome. In fact, this principle underpins the Department's current
endeavor, which stems from its recognition of substantial enhancements
attainable through continued scrutiny of its existing regulations.
4. Tribal and Other Government Engagement
Comment: A commenter stated BOEM's Tribal engagement process has
fallen short of the requirements in E.O. 13175 as meetings between BOEM
and the Hoh Tribe and other Tribes have not included BOEM officials
with Federal decision-making authority. The commenter asserted that all
OSW development should be immediately halted until BOEM conducts
meaningful consultation with all affected Tribes. The commenter
discussed the Treaty of Olympia and the rights afforded to Tribes
within that Treaty.
Another commenter asserted that the proposed rule does not
adequately address the impacts on coastal communities and fisheries,
thus requiring consultation. The commenter recommended that BOEM use
this rule to build in additional, meaningful, and more explicit
triggers for consultation with Indian Tribal Governments. Also, in
support of incorporating tribal consultation requirements in the rule,
a commenter said such consultation should be comprehensive and give
deference to tribal concerns.
A third commenter asserted that BOEM's leasing process is
``broken'' and ``needs to be dismantled and rebuilt'' to include
consultation with Tribes and others.
Response: The Department agrees that OSW must be developed
responsibly and in collaboration with potentially affected Tribal
governments, and through meaningful engagement with local communities,
and may not come at the expense of treaty rights, resources, and
cultural practices. The Department is committed to fulfilling the
Federal tribal trust responsibility, and complying with E.O. 13175, and
DOI policy and procedures for consulting with Indian Tribes and ANCSA
Corporations. BOEM invited federally recognized Tribes and ANCSA
Corporations to consult on the proposed renewable energy modernization
rule in a Dear Tribal Leader/ANCSA Leader letter dated February 28,
2023. BOEM met with Tribes who requested government-to-government or
staff level meetings on the proposed rule.
In addition to the requirements in E.O. 13175, the Department's
existing and proposed regulations also require consultation with
affected Tribes at several points during the OSW leasing process. The
regulations require Tribal coordination and consultation with the
Tribal leadership for Tribes that may be affected by any leases,
easements or ROWs BOEM issues (Sec. 585.102(e)); prior to the issuance
of any lease (Sec. 585.203); and during the area identification
process that takes place prior to the competitive issuance of leases
(Sec. 585.211(b)). The proposed and final rules do not diminish any of
the Department's coordination or consultation responsibilities with
Tribes, but rather specifically identify points when coordination and
consultation is necessary.
Comment: Some commenters requested consultation with BOEM to
discuss the proposed rule and expressed disagreement with the statement
that the rule would not have substantial direct effects on Tribes and,
therefore, does not require government-to-government consultation.
Commenters stated they would like to discuss the impact of the rule on
cultural resources, environmental resources, traditional practices, and
sacred sites and features of significance to the Tribes; treaty rights,
resources, and interests, including fishing rights and ecosystems
impacts that may affect these; and food security, human health, and
environmental justice.
Response: The Department strives to strengthen its government-to-
government relationships with American Indian and Alaska Native Tribes
through a commitment to consultation with those Tribes and recognition
of their right to self-governance and tribal sovereignty. For
additional information, see Section H of the preamble.
BOEM invited federally recognized Tribes and ANCSA Corporations to
consult on the proposed renewable energy modernization rule in a Dear
Tribal Leader/ANCSA Leader letter dated February 28, 2023. In response
to
[[Page 42656]]
requests from Tribal Nations, BOEM held multiple formal government-to-
government consultations with Tribes as well as staff-level information
sharing meetings with Tribal staff. These consultations and meetings
included the following:
Confederated Tribes of Coos, Lower Umpqua Tribe, and
Siuslaw Indian Tribe (CTCLUSI)--consultation held on May 4, 2023;
Hoh Indian Tribe--consultation held on June 30, 2023;
Makah Tribe--consultation held on June 29, 2023, with
staff-level meetings held on May 17 and June 12, 2023;
Resighini Rancheria--staff-level meeting held May 24,
2023; and
Shinnecock Indian Nation--consultation held on April 17,
2023.
The meeting notes from these consultations and staff-level meetings
are available in the docket (Docket ID. BOEM-2023-0005).
Comment: A commenter suggested that BOEM consult with Tribes at
each stage of the OSW leasing and development process prior to making
any decisions, including reviews of surveys, SAPs, COPs, and other
decisions. The commenter suggested that BOEM should require bidders to
consult with Tribes on Tribal concerns to be eligible for the bid
process and stated that the final rule should include early
coordination with Tribes, and they ``should not be asked to provide
comment on a proposed Lease or Permit before we know if there are
substantial conflicts that need to be assessed prior to identification
of a Call Area or Wind Energy Area.''
Response: The current and proposed regulations require the
Department to consult with affected Tribes at several points during the
OSW leasing process and the Department welcomes additional tribal
consultation requests at any time. The regulations require Tribal
coordination and consultation with the Tribal leadership for Tribes
that may be affected by any leases, easements, or ROWs BOEM issues
(Sec. 585.102(e)); prior to the issuance of any lease (Sec. 585.203);
and during the area identification process that takes place prior to
the competitive issuance of leases (Sec. 585.211(b)). The Department
also consults with tribal historic preservation officers pursuant to
the NHPA.
Comment: A commenter asserted that BOEM should include in the rule
a requirement for consultation with the U.S. Fish and Wildlife Service
and the NMFS under the ESA early in the planning process to eliminate
or reduce potential harm. The commenter asserted that due to the
``passage of the right whale extinction rider in the FY23 Omnibus, BOEM
must reinitiate consultation under the Endangered Species Act'' as this
rider constitutes new information and may indicate a take of Northern
Atlantic right whales.
Response: BOEM does not promulgate regulations regarding endangered
species, including the North Atlantic right whale. Regulations under
the Endangered Species Act (ESA) are promulgated by the NMFS and the
U.S. Fish and Wildlife Service. The text of the 2023 fiscal year
omnibus spending bill does not implicate the final rule. ESA
consultation for the promulgation of the final rule is unwarranted
because the final rule does not authorize any activities and,
therefore, the Department's action has no effect on threatened or
endangered species protected by the ESA.
The Department has and will continue to comply with all applicable
regulations throughout the entire leasing process, including those
under the ESA. The promulgation of this final rule does not authorize
any activities and therefore, the Department's action has no effect on
threatened or endangered species protected by the ESA. BOEM performs
the necessary consultations at the lease sale and COP approval stages.
Comment: A commenter recommended that the rule explicitly require
consultation with indigenous people (e.g., Native Hawaiians) wherever
consultation with Federal and State agencies, local governments,
tribes, and other stakeholders is required.
Response: BOEM agrees and revised Sec. 585.203 (With whom will
BOEM consult before issuance of leases?) to include any affected Native
Hawaiian Community or Alaska Native Corporation. Congress expressly
requires Federal agencies to consult with the Native Hawaiian Community
under specific statutes such as the Native American Graves Protection
and Repatriation Act (NAGPRA) and section 106 of the NHPA, and to
consult before taking actions that have the potential to significantly
affect Native Hawaiian resources, rights, or lands. Additionally, in
October 2022, DOI issued a draft consultation policy (DM part 513 part
1 and part 2) and announced that it will require formal consultation
with the Native Hawaiian Community. BOEM is committed to following DOI
policy on Consultation with the Native Hawaiian Community and will
follow those draft guidelines.
Comment: A commenter said that early Federal agency coordination is
needed for sand resource needs and data. The commenter said that if
sand resources are to be crossed with offshore export cable corridor's
the applicant should detail the reasonableness of doing so, and why
other options are not practical.
Response: BOEM agrees with the importance of early coordination for
sand resource needs and data. Sections 585.212 and 585.203 identify
what is evaluated for the area identification and with whom BOEM will
consult before the issuance of a lease. These two touchpoints are
critical for the review of other available offshore resources and the
potential for avoidance or minimization of impacts to these resources.
However, BOEM has not finalized additional requirements for lessees
regarding the reasonableness of crossing sand resources. We believe
this issue can continue to be addressed without the imposition of
additional requirements on lessees.
Comment: A commenter thanked BOEM for proposed modifications that
would improve Federal and State agency collaboration to ensure that
regulatory actions affecting coastal resources are conducted according
to the best available science. However, the commenter expressed concern
that the proposed rule would diminish the states' role in the NEPA
process and decrease their ability to conduct efficient and
comprehensive consistency reviews. The commenter also stated their
concern for how proposed changes may impact the consideration of
environmental and coastal resource impacts that must be considered
under NEPA, and other related laws. A commenter recommended early
coordination between BOEM, project developers, and the State to
determine the necessary data and information that would be needed to
support the Federal consistency determination.
Response: The NEPA and CZMA roles are two separate processes. The
requirements under NEPA for public comments provides the states with
multiple opportunities to request additional information and data be
analyzed that have been identified through a state's coastal management
program as necessary data and information. If that information is not
included in the NEPA document, the Department still has the
responsibility to ensure this necessary data and information is
included in the consistency determinations and/or consistency reviews.
The Department agrees that early and continuous coordination with
the states and project developers take place throughout the project
timeframe. Lastly, this final rule does not modify
[[Page 42657]]
the Department's obligations under NEPA and the CZMA.
Comment: A commenter stated that BOEM has not changed its process
to increase the assurance of safety or protection of commercial
fisheries and species in its process, despite concerns from NOAA. The
commenter expressed opposition to BOEM's deference to developers over
cooperating agencies in creating a purpose and need statement for NEPA
review.
Response: The Department works closely and frequently with NOAA on
many issues relating to commercial fisheries, marine mammals, and other
resources. NOAA did not submit comments related to the Department's
regulations. The comment on the purpose and need statement in
individual NEPA reviews is outside the scope of this rulemaking. BOEM
complies with the requirements of NEPA and the CEQ regulations when
developing a purpose and need statement for NEPA review.
Comment: A commenter said they would like BOEM to commit to both
formal and informal consultation with Tribes. Additionally, the
commenter said that it is important to provide coastal communities with
a forum to provide input on the proposed rules and proposed development
activities that the rule would facilitate.
Response: The current and proposed regulations require Tribal
consultation at several stages in the OSW leasing process. The
Department is committed to following DOI policy to consult with Tribes
for departmental actions with Tribal implications, as well as
consulting with Tribes as required by statute, such as NEPA and the
NHPA. The Department consults with Tribes at the Tribal leader and
staff level and is committed to fulfilling the government's tribal
trust responsibilities. BOEM initiated and held government-to-
government consultations and staff-level meetings with five Indian
Tribes to discuss potential impacts and to solicit and fully consider
their views on the proposed rulemaking. In addition, the Department is
always open to requested formal consultation and ongoing information
consultation and dialogue with Tribal nations.
Comment: A couple of commenters discussed public engagement and the
renewable energy leasing schedule. A commenter recommended that in
creating a schedule, BOEM should provide a process to ensure
stakeholder engagement. A commenter said the renewable energy leasing
schedule would help inform Tribes and stakeholders of opportunities for
engagement. The commenter said that more information about OSW
development processes and formal public comment opportunities could
improve public knowledge on projects and facilitate deep and meaningful
engagements.
Response: BOEM has not included a requirement for a comment period
prior to publishing the leasing schedule every two years. The leasing
schedule is meant to shed light on the state of BOEM's current thinking
rather than being the culmination of a detailed decision-making
process. Note that areas identified in a leasing schedule will likely
not see actual development for at least another 10-15 years, during
which many comment periods, public meetings, consultations, government-
to-government consultations, meetings, publications, studies, plans and
other activities must take place. The leasing schedule sits at the
beginning of this process and is intended to let the public know where
BOEM plans to focus its attention on the consideration of new areas.
Comment: A commenter said that BOEM needs to clarify when
engagement with potentially impacted parties is required in the
noncompetitive leasing process.
Response: Subsection 8(p)(3) of OCSLA requires BOEM to award leases
competitively, unless BOEM determines that there is no competitive
interest. An RFI issued pursuant to Sec. 585.210 of BOEM's existing
regulations is a preliminary step to assist BOEM in determining
potential interest in OSW energy development in the RFI Area. At the
same time, the RFI requests specific and detailed comments from the
public and other interested or affected parties regarding the features,
activities, mitigations, or concerns within or around the RFI Area.
Whether the leasing process is competitive or noncompetitive, BOEM
includes opportunities for the public to provide input. BOEM must
comply with all required consultations and environmental analyses
before issuing a lease noncompetitively, as required by Sec. 585.231.
Further, BOEM will coordinate and consult, as appropriate, with
relevant Federal agencies, federally recognized Tribes, affected State
and local governments, and other affected or interested parties in
formulating lease terms, conditions, and stipulations.
5. Technical Comments
Comment: One commenter suggested that BOEM require ``a bond
sufficient to disassemble and remove any structure or other components
and restore the offshore area at the end of its useful life, or if the
impacts to the ocean are significantly adverse, greater than the
intensity predicted in its analysis, or cannot be otherwise
mitigated.''
Response: This comment highlights an important consideration and
one to which BOEM already dedicates considerable resources. BOEM will
ensure that its authority is implemented in a way that adequately
mitigates the risk of stranded OCS assets.
Comment: A commenter stated that BOEM should revise the definition
of ``energy product'' in the proposed rule to clarify that the part 585
regulations are applicable to hydrogen products and that hydrogen
produced offshore is regulated by BOEM and BSEE, regardless of end use.
Response: BOEM does consider hydrogen as an ``energy product''
potentially subject to BOEM's regulatory oversight. This is consistent
with the approach that BOEM announced in the preamble to the 2009
regulations when it said, ``In the future, other types of renewable
energy projects may be pursued on the OCS, including solar energy and
hydrogen production projects. These regulations were developed to allow
for a broad spectrum of renewable energy development without specific
requirements for each type of energy production.'' 74 FR 19638 at 19646
(Apr. 29, 2009). BOEM is not revising the definition of ``energy
product'' in the final rule.
Comment: A few commenters suggested revisions related to plans. A
commenter stated that BOEM should include the modifications at Sec.
585.628(c) related to Federal review periods in the requirements for
GAPs. A commenter suggested that BOEM include milestones for its COP
review process and proposed the following milestones:
BOEM should hold a pre-COP filing meeting to review the
proposed project and ensure a coordinated review;
BOEM should include a nominal timeline for its
determination that a submitted COP is complete and sufficient;
BOEM should include a nominal timeline for its
determination that a submitted COP is complete and sufficient;
BOEM should include a timeline to describe consultation
with cooperating agencies and outline when alternatives are to be
analyzed in the NEPA document.
Response: As the commenters are aware, BOEM recently published
guidance recommending pre-COP filing meetings between the lessee and
Federal agencies, including BOEM, and describing milestones leading to
the determination that a COP is complete
[[Page 42658]]
and sufficient.\17\ Further, BOEM shares the commenter's belief in the
importance of predictability and reasonable timelines. However, BOEM
declines to commit by rule to additional timelines, beyond those
already required by authorities like FAST-41 and the Fiscal
Responsibility Act of 2023. These laws already impose deadlines and
scheduling requirements on BOEM and other Federal agencies reviewing
offshore wind projects, and additional timelines would do little to
promote the expedited development of OCS resources. BOEM's guidance
allows for flexibility while also setting out milestones for the
submission of COPs and an orderly review process.
---------------------------------------------------------------------------
\17\ See Recommendations for Pre-Notice of Intent (NOI) Federal
Interagency Engagement on Construction and Operations Plans (COP)
for Offshore Wind, (Aug. 2023), available at https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/BOEM%20NOI%20Checklist.pdf.
---------------------------------------------------------------------------
Comment: A commenter suggested that BOEM include a provision ``to
offer lessees conforming amendments to their leases'' after the rule is
finalized and allow lessees to opt out of some or all proposed changes.
Response: Existing leases require compliance with BOEM's
regulations, including ``regulations promulgated thereafter, except to
the extent that they explicitly conflict with an express provision of
this lease.'' Accordingly, existing lessees cannot ``opt out'' of
requirements imposed by later-promulgated regulations. However,
bilateral lease amendments can be negotiated between BOEM and lessees
at any time, and BOEM is open to discussing conforming lease amendments
as suggested by the commenter. For example, to take advantage of
certain benefits included in these regulations that conflict with
existing lease provisions. BOEM declines to make such a broad offer of
conforming edits in the rule itself.
Comment: A commenter suggested that BOEM define ``competing uses''
with an example (offshore sand resources) included in the definition.
Response: BOEM declines to define the term ``competing uses.''
While BOEM agrees that something like offshore sand resources could be
a use of the OCS that may compete with OSW development (for example in
export cable siting), the common meaning of the term is not ambiguous,
and the addition of examples may raise questions about why those
examples and not others were included.
Comment: A commenter suggested that BOEM define ``project
engineer'' in subpart G or remove the term.
Response: BOEM understands the term ``project engineer'' to be an
accepted term in the engineering profession for the licensed engineer
responsible for the design of the project. Without understanding
further why the commenter thinks that the term is unclear, BOEM
declines to remove it.
Comment: Another commenter suggested that BOEM define ``fair return
to the US taxpayer'' so that the readers know that ``the proposed rule
would advance the Department of the Interior energy policies in a safe
and environmentally sound manner that would provide a fair return to
the U.S. taxpayer.'' The commenter believes the ``the cost of offshore
wind as part of the fair return calculation'' should include:
(1) The cost to taxpayers of paying above-market rates for
electricity from offshore wind.
(2) The cost to taxpayers of the subsidies for manufacturing
credits and port facilities to stage construction.
(3) The cost to taxpayers of additional backup generation (reserve
margin) that is required when the wind doesn't blow.
(4) The cost to taxpayers of the additional grid infrastructure and
transmission lines to connect the geographically spread out offshore
wind turbines.
(5) The cost to taxpayers of the 30% ITC provided to the offshore
wind developers.
Response: BOEM declines to define ``fair return to the US
taxpayer'' in this final rule. OCSLA requires that the government
obtain a ``fair return to the United States for any lease, easement, or
right-of-way . . .'' The items enumerated in the comment are outside
the scope of a lease, easement, or right-of-way issued under OCSLA. The
decision to procure OSW power is made by the purchasers of that
electricity, in most cases through State legislation, State governors,
or state regulatory authorities.
Comment: A commenter recommended that BOEM redefine the term
``engineered foundation'' as a ``fixed-bottom structure,'' excluding
equipment like anchors, or remove the term.
Response: BOEM has removed the defined term ``engineered
foundation'' from this final rule.
Comment: A commenter recommended that BOEM revise the description
of call and area identification consistent with editorial revisions
that the commenter provided to emphasize that these areas are for
commercial development and that development of the areas will consider
potential environmental benefits and potential conflicts.
Response: BOEM has not followed this recommendation in the final
rule. BOEM understands the interest in explicitly describing
consideration of environmental benefits in addition to potential
conflicts. However, the considerations already listed (e.g.,
environmental factors or characteristics, stakeholder comments,
industry nominations) provide an opportunity for consideration of both
benefits and drawbacks of areas under consideration.
IV. Summary of Cost, Economic Impacts, and Additional Analyses
Conducted
A. What are the affected facilities?
The rule affects energy companies with OCS renewable energy leases,
as well as future bidders, applicants, lessees, and grantees.
(Sec. Sec. 585.107 through 585.113) The impact on existing lessees
depends in part on whether a regulatory change conflicts with an
existing lease term. The Department plans to review existing leases for
possible conflicts with the final regulations promulgated in this final
rule. Where there is no conflict, the final rule will apply equally to
existing and future leases. Where conflicts are identified, BOEM may
offer to lessees a package of lease amendments that would promote
consistency between existing and future lessees.
B. What are the economic impacts?
BOEM conducted a Regulatory Impact Analysis, on behalf of the
Department, to consider the costs and benefits of the rule. Most of the
revisions in the rule have negligible or no cost impact, while others
may have second-order benefits that are difficult to quantify. BOEM
identified four elements of the rule that have quantifiable effects.
Three of those changes (met buoy requirements, financial assurance, and
geotechnical survey revisions) provide compliance cost savings and one,
Safety Management System reporting, has minor compliance cost. In net,
BOEM estimates these changes could save the OCS renewable energy
industry approximately $127 million in annualized cost savings over the
20-year period of analysis (3 percent discounting).
C. What are the benefits?
This rule provides additional clarity and certainty, while
streamlining the regulatory framework. The changes from this rule will
facilitate more expedient and responsible development of offshore
renewable energy projects. The regulation provides net compliance cost
savings of approximately $127 million
[[Page 42659]]
in annualized cost savings over the 20-year period of analysis (3
percent discounting).
D. What Tribal engagement activities were conducted?
On February 27, 2023, BOEM sent a letter to all federally
recognized tribes (Tribal Nations) inviting each to government-to-
government consultation on the Renewable Energy Modernization Rule.
This letter was sent after publication of the NPRM but before the 60-
day public comment period closed. After receiving opposition to the
determination that the proposed rule would not have substantial direct
effects on Tribes, BOEM extended the comment period on the NPRM to
allow more time for consultations and to address Tribal concerns.
To date, BOEM's Tribal engagements on the NPRM have included
government-to-government consultations conducted jointly with BSEE and
staff-level briefings with six Tribal Nations: the Confederated Tribes
of Coos, Lower Umpqua, and Siuslaw Indians (held May 4, 2023), the Hoh
Indian Tribe (held June 30, 2023), the Makah Tribe (held May 17, June
12, and June 29, 2023), the Resighini Rancheria (held May 24, 2023),
the Shinnecock Indian Nation (held April 17, 2023), and the Mashpee
Wampanoag Tribe (held March 26, 2024). For more details on these
engagements, see the Tribal engagement summary memorandum and the
meeting notes for the engagements in the docket (Docket ID No. BOEM-
2023-0005).
Several concerns were communicated by the Tribes during the
consultations. Tribes indicated that the Department should consult with
Tribes at each stage of the rulemaking process prior to making any
decisions, requested the development of a programmatic agreement with
Tribes to address NHPA section 106 obligations, and maintained that the
Department must require the complete removal of turbines after a wind
farm ceases to operate. Additionally, Tribes suggested that the
Department should develop a Programmatic EIS (PEIS) before offshore
wind development proceeds, that the Department conduct meaningful
consultation with affected Tribes, and that they have concerns
regarding lease obligations related to environmental stewardship.
The Department appreciates the Tribal expertise that has been
shared and welcomes continued engagement with Tribes after promulgation
of this rule.
V. Section-by-Section Analysis
This section-by-section analysis presumes that the reader is
generally familiar with what was proposed in the NPRM. In most cases,
therefore, the summary below is focused on the changes that were made
to the NPRM text as a result of the public comments that were received.
This section-by-section analysis also generally does not include any
detailed discussion of the technical changes to the NPRM proposed
regulations made by the ``Reorganization of Title 30--Renewable Energy
and Alternative Uses of Existing Facilities on the Outer Continental
Shelf'' direct final rule (88 FR 6376, January 31, 2023). This direct
final rule, also known as the Reorganization Rule, describes the
division of administrative responsibilities between BOEM (parts 585 and
586) and BSEE (part 285) for the administration of certain regulations
governing renewable energy development and alternate uses of existing
facilities on the Outer Continental Shelf. Readers also should be aware
that some sections of the part 585 regulations have been duplicated and
included, in whole or in part, in part 285 where appropriate and other
sections have been partially divided between parts 285 and 585 to
reflect the assigned responsibilities of each Bureau. BSEE is also
making minor edits to every section to apply the transfer of authority
from BOEM to BSEE.
A. 30 CFR Part 285
Sec. 285.102 What are BSEE's responsibilities under this part?
Summary of proposed rule provisions: The Department proposed to
revise Sec. 585.102(a) to authorize renewable energy activities in
accordance with OCSLA subsection 8(p)(4), as enumerated in Sec.
585.102(a)(1) through (12). The Department proposed amending this
regulation to clarify that none of the enumerated requirements are
intended to outweigh or supplant any other.
Summary of comments:
Comment: A commenter discussed the Department's statutory authority
under OCSLA subsection 8(p)(4) and stated that the proposed rule ``is
strongly rooted in and supported by Federal case law and the final rule
should expressly acknowledge that point.'' Further, the commenter
stated that subsection 8(p)(4) does not require the Department to
ensure that OCSLA's goals are achieved to a particular degree, but
instead requires that the Department employ its discretion to achieve a
balance among the statute's several factors, considering Congress's
direction to authorize renewable energy development on the OCS, leaving
``striking the proper balance . . . up to the Secretary of the
Interior,'' so long as that balance is rational.
Response: BSEE considered the comment and agrees that BSEE has
authority under OCSLA subsection 8(p)(4). BSEE determined the existing
language in 30 CFR part 285 adequately and accurately describes BSEE's
responsibilities and acknowledges the balance that BSEE is required to
maintain under OCSLA.
Summary of final rule revisions: The Department did not finalize
the proposed language because the existing language in 30 CFR part 285
adequately and accurately describes BSEE's responsibilities and
acknowledges the balance that BSEE is required to maintain. The
Department did not finalize the parts of Sec. 285.102 that were
reassigned to BOEM's administration under the Reorganization Rule.
Sec. 285.103 When may BSEE prescribe or approve departures from
the regulations in this part?
Summary of proposed rule provisions: The Department proposed to
modify the Sec. 585.103(a) introductory text and paragraph (a)(1) to
specify that the Department may prescribe or approve a departure from
the regulations when the Department deems the departure necessary
because the applicable provision(s), as applied to a specific
circumstance, are impractical or unduly burdensome. The Department
determined that the departure provision was necessary to achieve the
intended objectives of the renewable energy program and to allow the
Department the flexibility to adapt the regulations to the unique
circumstances of this new and evolving industry while retaining the
consistency and integrity of the regulations as a whole.
Summary of comments:
Comment: Commenters suggested that the departure section should
apply only to ``pre-determined and narrow circumstances.''
Response: The Department considered the comments and is finalizing
this section as proposed. Regulations cannot foreseeably address all
specific scenarios that may arise in practice. Therefore, departures
are necessary to provide flexibility in unforeseen situations where
strict application of the regulations would be unfair, impractical,
unnecessary or even impossible (e.g., unforeseen contradictions in
regulatory provisions). Applying the departure section to only ``pre-
determined and narrow circumstances'' would risk leaving the bureau and
the regulated community
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unable to respond to unforeseen circumstances outside such pre-
determined and narrow circumstances.
Summary of final rule revisions: The Department considered comments
on the proposed revisions to Sec. 585.103 and is finalizing the
proposed revisions in Sec. 285.103(a) without change. The revisions
allow BSEE to prescribe or approve departures from these regulations
when necessary because the applicable provisions, as applied to a
specific circumstance: (1) are impractical or unduly burdensome and the
departure is necessary to achieve the intended objectives of the
renewable energy program; (2) fail to conserve the natural resources of
the OCS; (3) fail to protect life (including human and wildlife),
property, or the marine, coastal, or human environment; or (4) fail to
protect sites, structures, or objects of historical or archaeological
significance. No changes were proposed to Sec. 585.103(b), which lists
additional departure requirements, and no changes were made to Sec.
285.103(b).
Sec. 285.105 What are my responsibilities under this part?
Summary of proposed rule provisions: The Department proposed a
minor modification to strengthen the requirement for lessees to comply
with all applicable laws, regulations, other requirements, the terms of
the lease or grant under this part, reports, notices, approved plans,
and any conditions imposed by the Department. This was intended to
expand, strengthen, and clarify the language found in existing Sec.
585.105(d), requiring compliance only with the ``terms, conditions, and
provisions of all reports and notices submitted to BOEM, and of all
plans, revisions, and other BOEM approvals, as provided in this part.''
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions:
The Department is finalizing the proposed revisions in the final
rule at Sec. 285.105 with minor clarifications that the named entities
must comply with all applicable laws and regulations, the terms of the
lease or grant under 30 CFR part 585 or 586; reports, notices, and
approved plans prepared under this part, part 585 or 586; and any
conditions imposed by BOEM or BSEE through its review of any of these
reports, notices, and approved plans. The minor clarifications BSEE
made here are administrative edits to reflect changes resulting from
the Reorganization Rule.
Sec. 285.110 How do I submit applications, reports, or notices
required by this part?
Summary of proposed rule provisions: The Department proposed
eliminating its paper copy requirement and relying primarily on
electronic submissions. The Department proposed to reserve the
authority to require paper copies of certain documents (such as maps
and charts) if necessary. The Department also proposed eliminating the
mailing address to avoid the need for future technical corrections if
the mailing address changes and, instead, listing the mailing addresses
for the appropriate contacts on the appropriate website.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing the
proposed revisions in the final rule at Sec. 285.110. BSEE is revising
Sec. [thinsp]285.110 to require lessees to submit one electronic copy
of all plans, applications, reports, or notices required by this part
to BSEE. The revisions also state that BSEE will inform the lessee if
it requires paper copies of specific documents, and that documents
should be submitted to the relevant contacts listed on the BSEE
website.
BSEE has implemented an electronic submittal system which, except
for special situations, eliminates the need for paper copies of
submittals. This minimizes the administrative burden on both the
industry and the government and ensures the administrative record is
properly maintained.
Sec. 285.112 Definitions.
Summary of proposed rule provisions:
The Department proposed adding a new definition for ``bidding
credits.'' Bidding credits are defined as the value assigned by BOEM,
expressed in monetary terms, to the factors or actions demonstrated, or
committed to, by a bidder at a BOEM lease auction during the
competitive lease award process. The regulations further specify that
the types and values of any bidding credits awarded to any given bidder
will be set forth in the FSN.
The Department proposed modifying the definition of ``commercial
activities'' to state that such activities are conducted ``under''
leases and grants. This modification was intended to maintain
consistency with the proposed revisions to Sec. 585.104 by clarifying
that site assessment activities that are not conducted on a commercial
lease (and thus do not require a lease) would be excluded from the
definition of ``commercial activities.''
The Department proposed modifying the definition of ``commercial
operations'' to state that the term means the generation of electricity
or other energy product for commercial use, sale, and distribution on a
commercial lease, but does not mean either generation needed to prepare
a final FIR or generation for testing purposes, provided the
electricity generated for such testing is not sold on a commercial
basis.
The Department proposed adding a new definition for ``Critical
Safety Systems and Equipment'' to mean safety systems and equipment
designed to prevent or ameliorate major accidents that could result in
harm to health, safety, or the environment associated with the lessee's
or grant holder's facilities.
The Department proposed adding a definition for the term
``engineered foundation,'' which would mean any structure installed on
the seabed using a fixed-bottom foundation constructed according to a
professional engineering design based on an assessment of sedimentary,
meteorological, or oceanographic conditions.
The Department also proposed adding a definition for the term
``fabrication'' which would mean the cutting, fitting, welding, or
other assembly of project elements of a custom design conforming to
project-specific requirements.
The Department proposed adding definitions for the terms ``lease
area'' and ``provisional winner'' to provide clarity in the regulatory
text. Lease area is an OCS area identified by BOEM for potential
development of renewable energy resources. The provisional winner is
the bidder that BOEM determines at the conclusion of the auction to
have submitted the highest bid. The Department proposed redefining the
provisional winner to be the winning bidder upon favorable completion
of the government's post-auction reviews.
The Department proposed adding a new definition of ``multiple
factor auction,'' which would be defined to mean an auction that
involves the use of bidding credits to incentivize goals or actions
that support public policy objectives or maximize public benefits
through the competitive leasing auction process. For all multiple
factor auctions, the Department proposed adding the monetary value of
the bidding credits to the value of the cash bid to determine the
highest bidder.
The Department proposed clarifying that ``receipt'' of a document
as having been deemed to take place, in the absence of documentation to
the contrary, (a) 5-business days after the document was given to a
mail or delivery service with the proper address and postage; or (b) on
the date the document was sent electronically.
[[Page 42661]]
Finally, the Department proposed a technical correction to the
definition of ``site assessment activities'' to avoid possible
confusion with site characterization activities.
Summary of comments:
Comment: A commenter recommended that the Department delete the
definition of ``engineered foundation'' from Sec. 585.600(a)(1) to
avoid confusion, given that it only applies to met towers and no other
structures.
Response: BOEM removed the term ``engineered foundation'' from
Sec. 585.600(a)(1). BSEE agrees with this approach, given that the
term ``engineered foundation'' was intended to be used only in the SAP
provisions of the rule and, therefore, the Department is not adding the
definition to Sec. 285.112 since the term is no longer used.
Comment: A commenter suggested that the Department explicitly
define ``installation'' and ``commissioning'' similar to the definition
of ``fabrication'' and explain in more detail what is included in
Critical Safety Systems and Equipment to better define what is required
to be verified by a CVA.
Response: BSEE disagrees with the comment because the terms
``installation'' and ``commissioning'' are commonly used and understood
terms. BSEE did add additional language to the definition of Critical
Safety Systems and Equipment to clarify that these devices could be a
single piece of equipment or a system and to align more closely with
OCSLA.
BSEE did not specify the exact ``Critical Safety Systems and
Equipment'' because of the rapid pace of technology development and
differences in systems and equipment between projects. Instead,
Critical Safety Systems and Equipment must be identified on a project
basis through the risk assessment process that is overseen by the CVA.
Comment: A commenter stated that the proposed definition of
``commercial operations'' should be formulated through collaboration
between BOEM and BSEE, grid operators, and project developers to avoid
technical risks between commissioning and start of operations.
Response: The Department considered all comments on ``commercial
operations'' provided in response to the proposed rule and the
Department is not finalizing the proposed language ``does not mean
either generation needed to prepare a final FIR or generation for
testing purposes, provided the electricity generated for such testing
is not sold on a commercial basis'' because this is a requirement that
should not be included as part of a definition. BSEE removed the
requirements from the definition of commercial operations and added
them to Sec. 285.637. BSEE is adding ``transmission'' to the list of
operations. BSEE has had discussions with several interested parties
concerning commercial operations departure requests. BSEE did not
conduct additional collaboration outside of the proposed rule process.
Comment: Commenters suggested that the Department make the
following revisions: (1) Modify the rule to remove the use of the term
``type-certified'' as it is unclear what stage of type certification is
needed before permission is granted or include ``type-certified'' as a
definition in the final rule; (2) Alternatively, introduce a definition
in Sec. 585.112 of type-certified to clarify what is meant by this
term. In that case, include that when used in these rules, type-
certified may describe components that are provisionally certified or
components that are in the process of type certification, so long as
the type certification is in place at time of final manufacturing.
Response: BSEE has revised the proposed language based on the
comment. Type-certified has been removed from the definition of
fabrication but remains in the Sec. 285.700 regulation to explain that
a type-certified component may be procured prior to FDR and FIR non-
objection.
Comment: A commenter expressed support for the proposed
modifications to the rule define ``fabrication'' as ``cutting, fitting,
welding or other assembly or project elements of custom design
conforming to project specific requirements'' and excluding from the
definition the procurement of discrete parts of the project that are
commercially available in standardized form.
Response: BSEE modified the proposed definition of fabrication to
state that, ``Fabrication means the cutting, fitting, welding, or other
assembly of project elements.'' The exclusions previously proposed in
the definition are now in the regulations at Sec. 285.700 but were not
appropriate for a definition.
Summary of final rule revisions:
Based on comments received and BSEE's experience since the
Reorganization Rule publication, the Department is revising the
definitions in this section to provide clarity and consistency and to
ensure alignment with BOEM's definitions in 30 CFR part 585. The
Department is revising the definitions of ``commercial activities'',
``commercial operations,'' ``decommissioning,'' and ``site assessment
activities,'' and adding definitions for ``Critical Safety Systems and
Equipment,'' ``fabrication,'' and ``project design envelope'' to 30 CFR
part 285.
BSEE is making changes to the definition of commercial activities
to maintain consistency with BOEM. The final rule modifies the
definition of ``commercial activities'' to state that such activities
are conducted ``under'' leases and grants rather than ``for'' them.
This clarifies that commercial activities as defined in the rule only
apply to on-lease or on-grant activities, and not off-lease or off-
grant activities by commercial lessees and grantees.
For the definition of ``commercial operations,'' the Department is
not finalizing the proposed language ``does not mean either generation
needed to prepare a final FIR or generation for testing purposes,
provided the electricity generated for such testing is not sold on a
commercial basis'' and is adding ``transmission'' to the list of
operations. This revision provides clarification of and consistency
with BSEE expectations of commercial operations according to Sec.
285.637.
The Department is adding the definition of ``Critical Safety
Systems and Equipment'' to part 285 to clarify the threshold for
systems and equipment to be considered critical for ensuring safety.
The Department is revising the proposed rule language by adding ``and
equipment'' to the term and adding fires and spillages to the list of
incidents covered by the term. The Department revised the term to
include ``and equipment'' because a single piece of equipment or a
system consisting of several pieces of equipment functioning together
may be used to prevent or ameliorate fires, spillages, or other major
accidents that could result in harm to health, safety, or the
environment. The additional revision provides clarity to ensure that
major accidents including fire and spillages are included and covered
by these systems or equipment and meets the threshold set by OCSLA.
The Department is incorporating the existing definition of
``decommissioning'' in to Sec. 285.112 and is removing the reference
to 30 CFR part 585 to reflect changes in the Reorganization Rule.
The Department is adding a definition for ``fabrication'' to part
285. BSEE modified the definition for ``fabrication'' from the proposed
rule to ``the cutting, fitting, welding, or other assembly of project
elements.'' BSEE removed the exclusion from custom designs and
standardized forms or type-certified
[[Page 42662]]
components from the definition of ``fabrication.'' The exclusion from
fabrication requirements for custom designs and standardized forms or
type-certified components and from fabrication not on the OCS is part
of the regulatory text in Sec. 285.700, which accomplishes the same
goal without putting the exception in the definition.
Additionally, the Department includes in the final rule the
definitions of ``project design envelope'' and ``site assessment
activities,'' as proposed in the NPRM at Sec. 585.112, without change.
The definitions for ``bidding credits,'' ``lease area,'' ``multiple
factor auction,'' ``provisional winner,'' and ``receipt'' proposed in
the NPRM at Sec. 585.112 are not finalized in part 285 of this rule.
These terms are not used in 30 CFR part 285 and, therefore, do not need
to be defined therein. The definition for ``engineered foundation'' was
proposed in the NPRM to apply to the SAP provisions of the regulations
but BSEE did not add it here because, as commenters noted, it had the
potential to cause confusion within the final rule.
Sec. 285.113 How will data and information obtained by BSEE under
this part be disclosed to the public?
Summary of proposed rule provisions: The Department proposed a
technical change, substituting the word ``operations'' for
``generation'' in paragraph (b)(1), so that the Department's review of
the data and information would be done ``3 years after the initiation
of commercial operations . . . ,'' to provide greater consistency with
the remainder of the Department's offshore renewable regulations.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE is revising paragraph (b)(1)
to replace ``initiation'' with ``commencement,'' and finalizing the use
of the term ``commercial operations'' in Sec. 285.113, as proposed in
the NPRM consistent with the revisions in Sec. 585.114. These are
editorial changes made to be consistent with the rest of the
regulations.
Sec. 285.114 Paperwork Reduction Act statements--information
collection.
Summary of proposed rule provisions: The Department proposed
updating the table in this section to align with proposed regulations.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE is not finalizing the
proposed revision to Sec. 285.114 and is keeping the provision in the
existing regulations. This section in the existing regulations already
reflects the current OMB control numbers recently covered by the
Reorganization Rule.
Sec. 285.116 Requests for information on the state of the offshore
renewable energy industry.
Summary of proposed rule provisions: The Department proposed
combining requests for interest and requests for information in a
revised Sec. 585.116 and naming them requests for information. The
proposed rule suggested eliminating the request for interest as a step
in the leasing process. The Department proposed that, in the event that
BOEM wanted to start the leasing process with a solicitation of
information from the public, the more general request for information
under Sec. 585.116 would be available to serve that purpose.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE finalized the language
proposed in Sec. 285.116(a) in the NPRM to be consistent with the
proposed Sec. 585.116(a). BSEE made minor, non-substantive changes,
such as removing ``(a)'' and making the regulation one paragraph
because BSEE is not including proposed paragraphs (b), (c), and (d) in
this section as those provisions pertain to leasing administration,
which BSEE does not administer.
Sec. 285.117 Severability.
Summary of proposed rule provisions: Section 285.117 is a new
regulation being added in this final rule and that was not included in
the proposed rule.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department's existing
regulations in this subpart did not contain a severability provision
nor did the Department propose one in the NPRM. However, in this final
rule, the Department has included a severability provision in new Sec.
285.117 as follows: ``If a court holds any provisions of this subpart
or their applicability to any persons or circumstances invalid, the
remainder of the provisions and their applicability to any persons or
circumstances will not be affected.'' While the Department has
determined that all of the sections of this subpart and part 585 in
this final rule can and do function separately, the Department
understands that a court will ultimately determine whether portions of
the rule can be severed from others. In the event a court determines a
provision was improperly promulgated, this section is designed to aid
that review by demonstrating that the Department intends the various
components of this final rule, with various provenances and independent
functions, to continue to operate even if one or more of the provisions
is declared unlawful.
Sec. 285.118 What are my appeal rights?
Summary of proposed rule provisions: The Department proposed
combining Sec. Sec. 585.118 and 585.225 by locating all procedures for
review of BOEM renewable energy final decisions or orders in a revised
Sec. 585.118. The purpose of this revised section was to maintain the
distinction between requesting reconsideration of rejected bids and
appeals of other final decisions made under part 585 but revise the
regulation to characterize challenges to decisions selecting
provisional winners as appeals to the Director, rather than requests
for reconsideration.
In the proposed rule, the Department suggested providing appeal
rights to any adversely affected bidder of a provisional winner
selection decision. The proposed section would also provide provisional
winners an opportunity to appeal if they determined there have been any
errors or omissions in the selection decision, such as miscalculated or
unapplied bidding credits.
This proposed section suggested that BOEM must receive written
appeals of a decision selecting the provisional winner within 15-
business days after a bidder receives notice of the decision. The
proposed section suggested adopting the rules found in the appeal
procedures at 30 CFR 590.3 for determining when a selection decision is
received.
Finally, the proposed section suggested clarifying two points
regarding an appeal of a decision selecting the provisional winner.
First, the provisional winner would have an opportunity to be heard
before the BOEM Director reverses a selection decision. Second, the
Director's decision would not be appealable administratively to the
Interior Board of Land Appeals.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department reviewed proposed
Sec. 585.118 and is finalizing the proposed language in Sec. 285.118,
with revisions to paragraphs (a) and (b) to reflect changes made in the
Reorganization Rule, to clarify the rights to appeal. The regulation
addresses a party's right to appeal a final decision issued by BSEE to
the Interior Board of Land Appeals
[[Page 42663]]
(IBLA), and that any BSEE final decision will remain in full force and
effect while the appeal is pending. BSEE is not including proposed
paragraph (c) in this section because those provisions pertain to
leasing, which is not administered by BSEE.
Sec. 285.400 What happens if I fail to comply with this part?
Summary of proposed rule provisions: The Department proposed
amending this section to ensure that its civil penalty authority for
OCS renewable energy activities addresses a more complete range of
violations and is coextensive with the authority that Congress granted
to it in OCSLA. The Department proposed adding a new paragraph (f)(2)
to address certain situations, such as civil penalties for violations
that constitute, or constituted, a threat of serious, irreparable, or
immediate harm, and to allow the Department to take appropriate action
by assessing civil penalties in the event that a lessee or operator
commits such failures.
Summary of comments:
Comment: One commenter requested that BSEE ensure that civil
penalties are reserved for the most serious circumstances. However,
another commenter requested that the Department ``take steps to ensure
that the penalty is reserved for truly serious circumstances and
require agency notice at some reasonable time after the assessment of
the civil penalty and prior to the accrual of any interest.'' Another
comment requested that BOEM and BSEE should ``commit to developing and
applying consistent precedent and interpretations in all areas of
shared responsibility'' to ``ensure that BSEE and BOEM do not take
different views of when specific conduct or circumstances constitute a
violation.''
Response: BSEE has not made changes to the finalized language based
on these comments because OCSLA establishes which violations warrant
civil penalty consideration and the language of the regulation tracks
the language of the statute. BSEE may assess a civil penalty if a
lessee does not correct a violation or if the violation posed a threat
or harm to safety or the environment. The maximum civil penalty is set
by law, but BSEE determines the amount for a specific violation based
on its severity, duration, and other factors. Lessees have the right to
request informal resolution of the decision from the Bureau and to file
an appeal with the Interior Board of Land Appeals. BSEE and BOEM are
committed to managing shared responsibilities through cooperation and
communication in the implementation and administration of their
authorities.
Summary of final rule revisions: BSEE considered comments on the
corresponding proposed revisions to Sec. 585.400 and is finalizing the
proposed language, with revisions to paragraphs (f)(1) and (2) to
reflect the Reorganization Rule and ensure consistency with OCSLA.
These administrative changes clarify BSEE's authority to assess civil
penalties if a lessee fails to comply with any provision of this part,
or any term of a lease, grant, or order issued under the authority of
this part. BSEE may assess the civil penalty after providing the lessee
notice of such failure and the expiration of a reasonable period to
correct the failure, or if BSEE determines that the failure constitutes
a threat of serious, irreparable, or immediate harm or damage to life,
property, or the marine, coastal, or human environment.
Sec. 285.415 What is a lease or grant suspension?
Summary of proposed rule provisions: The Department proposed to
replace the word ``term'' with ``period'' in light of its proposed
changes to Sec. 585.235.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE is finalizing paragraph (b)
in Sec. 285.415, consistent with proposed Sec. 585.415, to clarify
that a suspension extends the expiration date for the relevant period
of your lease or grant for the length of time the suspension is in
effect.
Sec. 285.417 When may BSEE order a suspension?
Summary of proposed rule provisions: The Department proposed to
eliminate the paper copy requirement for this regulation, consistent
with its proposed changes to Sec. 585.110.
Summary of comments:
Comment: BOEM [and BSEE] exceeded its statutory authority by making
substantive changes to the statutory criteria for lease suspension and
cancellation. Therefore, the commenter said the modernization rule
should include regulatory changes to correct differences between the
current regulatory criteria for lease suspension (Sec. 285.417) and
cancellation (Sec. Sec. 585.422(b)(4) and 285.437(b)(4)) and the
statutory (OCSLA) criteria.
Response: This rulemaking is not proposing to make changes to
BSEE's suspension or cancellation authority because we view them as
consistent with OCSLA. In the Energy Policy Act of 2005 (EPAct),
Congress authorized the Secretary of the Interior (Secretary) to
establish a program for renewable energy activities on the OCS and to
promulgate any necessary regulations to carry out that program.
Specifically, the EPAct amended OCSLA to add subsection 8(p) (43 U.S.C.
1337(p)). Subsection 8(p) grants the Secretary the authority to issue
leases, easements, and ROWs on the OCS for activities that produce or
support the production, transportation, storage, or transmission of
energy from sources other than oil and gas, or that use existing OCS
facilities for energy- or marine-related purposes that are not
otherwise authorized by OCSLA or other laws.
Summary of final rule revisions: BSEE is revising paragraph (b)(2)
of Sec. 285.417, consistent with the proposed Sec. 585.417, to
require a lessee to provide an electronic copy of the study and results
to BSEE pursuant to Sec. 285.110. This revision will help ensure that
BSEE receives the data in electronic format to facilitate appropriate
review and streamline submittal. BSEE is also making an
administratively corresponding edit to reflect the applicability of
this part to BSEE instead of BOEM as identified in the Reorganization
Rule.
Sec. 285.420 What effect does a suspension order have on my
payments?
Summary of proposed rule provisions: The Department proposed
combining paragraphs (b) and (c) of Sec. 585.420 to modify the
requirement that directed suspensions will always be accompanied by a
fee suspension. As a result of this proposal, all payment suspensions
would be at BOEM's discretion. The Department also proposed clarifying
that, regardless of whether a lease or grant suspension is approved or
ordered, BOEM would have discretion to ``waive or defer'' (rather than
``suspend'') payments while the lease or grant is suspended.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department reviewed proposed
section Sec. 585.420 and is finalizing this section in Sec. 285.420
to clarify, in light of the Reorganization Rule, that if BSEE orders a
suspension pursuant to Sec. 285.417, then BOEM may waive or defer a
lessee's payment obligations during the suspension. Additionally, BOEM
may decide to waive or defer the payment obligation based, in part, on
the reasons for the suspension and the lessee's responsibility for the
circumstances that necessitated the suspension. These changes were made
to maintain consistency with the regulations in part 585 and to provide
the same flexibility when either BSEE or BOEM orders a suspension.
[[Page 42664]]
Sec. 285.602 What records must I maintain?
Summary of proposed rule provisions: The Department proposed
expanding the recordkeeping requirements to require lessees and grant
holders to retain records relating to lease or grant compliance,
including SMS requirements.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing the
language that it proposed in Sec. 585.602, with administrative
revisions, to clarify that a lessee must maintain and provide to BSEE,
upon request, all data and information related to compliance with the
required terms and conditions of its lease, grant, reports submitted
under this part, and approved plan until BOEM releases the lessee's
financial assurance under Sec. 585.534. This revision, which is now in
Sec. 285.602, will help ensure BSEE receives or has access to
compliance information for all of the applicable operations and
activities. BSEE is making administrative corresponding edits to
reflect the applicability of this part to BSEE instead of BOEM as
identified in the Reorganization Rule.
Sec. 285.614 When may I begin conducting activities under my
approved SAP?
Summary of proposed rule provisions: The Department proposed
revising paragraph (b) by adding the word ``description'' after Safety
Management System to clarify that it is a description of the Safety
Management System that must be submitted, in conformance with the
requirements outlined in Sec. 585.810.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE is revising paragraph (b) of
Sec. 285.614, consistent with the proposed Sec. 585.614, to clarify
that a lessee must comply with the requirements of subpart G of this
part and submit its SMS description as required by Sec. 285.810 before
construction may begin if the lessee is installing a facility or a
combination of facilities deemed by BOEM to be complex or significant.
Sec. 285.637 When may I commence commercial operations on my
commercial lease?
Summary of proposed rule provisions:
The Department proposed moving existing Sec. 585.708(a)(5)(ii)
into Sec. 585.637 and changing ``certification'' to ``verification''
to maintain consistency with other provisions of the proposed rule. The
Department also proposed clarifying that commercial operations may
commence 30-calendar days after the Department deems submitted--rather
than receives--the final project verification report as described in
proposed Sec. Sec. 585.704 and 585.708(a)(5), provided that the
Department has not notified you within that time frame of any
objections to the verification report and that the Department has
confirmed receipt of critical safety systems commissioning records, as
described in Sec. 585.708(a)(6). The Department proposed revising
Sec. 585.713 by moving the requirement to notify the Department within
10-business days of starting commercial operations into Sec. 585.637.
The Department also proposed revising the definition of
``commercial operations'' to clarify that the generation of electricity
needed for the preparation of the final FIR or the generation of
electricity for testing purposes would be excluded from the definition,
provided that such electricity is not sold on a commercial basis.
Summary of comments:
Comment: A commenter suggested revising this section to allow
lessees to produce and sell power prior to final FIR non-objection.
Response: BSEE agrees with the commenter and is revising this
section to require that lessees and CVAs submit information to
demonstrate that facilities installed prior to first producing
commercial power have been fabricated and installed and that Critical
Safety Systems and Equipment have been commissioned properly. The
lessee may continue to keep producing so long as the lessee and CVA
continue to submit information demonstrating the additional facilities
been fabricated and installed and that Critical Safety Systems and
Equipment have been commissioned properly as they come online. This
addresses industry concerns about increased fatigue on the facilities
if they are shut down for extended periods of time and concerns about
the ability to meet power purchase agreements while balancing the need
for BSEE to ensure the safe operation of facilities on the OCS.
Comment: A commenter requested clarification on what is to be
included in the proposed PVR and when it should be submitted for
commercial operations to commence and suggested that CVAs be required
to provide a Project Certification Close-out Report within 18 months of
commercial operations.
Response: BSEE did not create a project certification closeout
report to be submitted within 18 months of commercial operations,
because some projects, especially large projects, may not have
completed installation of all their facilities within 18 months of
commercial operations. BSEE may consider this comment if it is within
the scope of future rulemakings. BSEE is updating Sec. 285.637 to
allow for power to be produced so long as lessees can demonstrate and
continue to demonstrate that their facilities were designed,
fabricated, installed, and commissioned properly to protect life and
the environment. This update addresses industry concerns about
increased fatigue on the facilities if they are shut down for extended
periods of time and concerns about the ability to meet power purchase
agreements while balancing the need for BSEE to ensure the safe
operation of facilities on the OCS. The contents of the project
verification report and submission requirements are described in Sec.
285.708.
Comment: A commenter requested that BSEE refine the definition to
allow lessees to produce and ``commercially sell test power produced
prior to the FIR non-objection.'' The commenter asserted that this
change would reduce tension in the electricity market rules and prevent
developers from defaulting on contractual commitments. The commenter
also requested clarification in the final rule that ``commercial
operations'' does not include energy produced after commissioning and
testing but prior to the commencement of such operations. The commenter
asserted that requiring developers to cease generation during the FIR
review could cause damage to turbines, would be unproductive, and would
reduce the fair return to taxpayers.
Response: BSEE has addressed the concern over commercial operations
in Sec. 285.637. The regulation has been revised to allow lessees to
produce and sell power prior to final FIR non-objection. The lessees
and CVAs must submit information to demonstrate that facilities
installed prior to first producing commercial power have been
fabricated and installed and that Critical Safety Systems and Equipment
have been commissioned properly. The lessee may continue to produce as
long as the lessee and CVA continue to submit information demonstrating
the additional facilities have been fabricated and installed and that
Critical Safety Systems and Equipment have been commissioned properly
as the facilities come online. Commercial operations begin the first
time the project generates electricity or other energy product for
commercial use, sale, or transmission or distribution from a commercial
lease.
BSEE also revised Sec. 285.637(a)(1) through (4) and (b) to allow
for power to be produced so long as lessees can
[[Page 42665]]
demonstrate and continue to demonstrate that their facilities were
designed, fabricated, installed, and commissioned properly to protect
life and the environment. BSEE revised this regulation because it
recognizes that allowing the turbines to spin minimizes fatigue on the
turbine and allowing power to be produced to the grid minimizes
negative impacts to power purchase agreements.
Summary of final rule revisions:
BSEE considered comments on the corresponding proposed revisions to
Sec. 585.637 and is finalizing the proposed language in Sec. 285.637,
with revisions to paragraphs (a)(1) through (4), (b), and (c) based on
the comments. Paragraphs (a)(1) through (4) address when a lessee may
commence commercial operations if the lessee is conducting activities
on its lease that do not require a FERC license. Under revised
paragraph (a), a lessee may commence commercial operations after the
following have occurred:
(1) the lessee has submitted information consistent with Sec.
285.702(c) and (d) for facilities installed prior to commencing
commercial operations;
(2) the CVA has submitted their PVR, as described in Sec.
285.708(a)(5) including information required by Sec. 285.708 (b)(1),
or interim report(s), as described in Sec. 285.712(a), for facilities
installed prior to commencing commercial operations;
(3) the CVA has submitted their Critical Safety Systems and
Equipment commissioning records, as described in Sec.
[thinsp]285.708(a)(6), or interim report(s), as described in Sec.
285.712(a); and
(4) BSEE has not notified the lessee of any objections to the
submittals in paragraphs (a)(1) and (a)(3) of this section within the
timeframes in Sec. Sec. 285.700(d) and 285.712(a), as applicable.
Paragraph (b) allows a lessee to continue commercial operations as
additional facilities complete commissioning if the lessee has
submitted the information required by paragraphs (a)(1) and (3) of this
section for facilities installed after commercial operations have
commenced. Lastly, paragraph (c) requires a lessee to notify BSEE
within 10 business days after it has commenced commercial operations.
The result of the revisions to Sec. 285.637 is that the lessee can
continue to produce electricity, which also minimizes fatigue on the
turbines, provided that BSEE continues to receive information
demonstrating that the facilities were fabricated, installed, and
commissioned properly.
Sec. 285.638 What must I do upon completion of my commercial
operations as approved in my COP or FERC license?
Summary of proposed rule provisions: The Department proposed
revising Sec. 585.638(a) to remove references to Sec. Sec. 285.905
and 285.906.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing the
first sentence of paragraph (a) in Sec. 285.638, consistent with
proposed Sec. 585.638, to require an operator to decommission its
project as set forth in subpart I of this part upon completion of its
approved activities under its COP.
Sec. 285.700 What reports must I submit to BSEE before installing
facilities described in my approved SAP, COP, or GAP?
Summary of proposed rule provisions:
The Department proposed clarifying its authority to allow lessees
to submit their FDRs and FIRs for review by major component, so long as
the lessee explains how all the major components will function together
in an integrated manner in accordance with the project design and the
integration is verified by a CVA. The Department also proposed
clarifying that FDRs and FIRs may be submitted before or after SAP,
COP, or GAP approval, though the Department's 60-day review period will
not start until the report is deemed submitted and the plan is
approved.
The Department also proposed revising Sec. 585.700 by adding new
paragraphs (b) and (c), and redesignating paragraphs (b) and (c) as
paragraphs (d) and (f). The Department proposed revisions to the
language in paragraph (b) of the existing regulations (redesignated as
paragraph (d)), and to add a new paragraph (e). Paragraph (d) clarifies
that FDRs and FIRs may be submitted before or after SAP, COP, or GAP
approval, though the Department's 60-day review period will not start
until the report is deemed submitted and the plan is approved.
Fabrication and installation activities on the OCS may only commence
once a lessee or grant holder has received the Department's non-
objection to the FDR and FIR or if no objections were made by the end
of the Department's 60-day review. Proposed new paragraph (e) clarifies
that (1) the procurement of discrete parts of the project that are
commercially available in standardized form and type-certified
components, or fabrication activities that do not take place on the
OCS, may commence prior to the submittal of the FDR and FIR or any
plans required under the Department's regulations; and (2) any
procurement or fabrication of facility components prior to the
Department's non-objection to the FDR and FIR, or the end of the
Department's 60-day review without objections, is subject to
verification by the CVA and to possible objection by the Department
prior to the installation of said components on the OCS.
Finally, the Department proposed to revise existing paragraph (c)
and redesignate it as paragraph (f), to clarify that it has 60 calendar
days to object to an FDR or FIR or to request additional information.
Summary of comments:
Comment: Commenters suggested that the terms ``verification'' and
``certification'' are not consistently defined across published
standards.
Response: BSEE agrees and, after considering various relevant
standards and references, is revising these terms as defined in the
Oxford Dictionary and contextual usage in relevant standards. The terms
``certify'' or ``certification'' describes how the CVA ``recognizes
that (someone or something) possesses certain qualifications or meets
certain standards.'' BSEE may require a CVA to ``certify'' that a
design or safety component conforms to a defined certification protocol
based on criteria from specific quality assurance standards or
recognized accepted engineering practices. The terms ``verify'' or
``verification'' describes how the CVA demonstrates that something is
true, accurate, or justified. BSEE has evaluated each of the CVAs
actions, as required by the regulations, and updated the regulations to
use the appropriate term.
Comment: Commenters suggested allowing a staged submittal of the
FDR and FIR. A few commenters stated that the proposal provides
improved clarity and flexibility to sequence the submittal to match the
fabrication schedule and reduces burden on the regulator and project. A
commenter suggested that the Department specifically state that FDRs
and FIRs may be organized and submitted by Tier 1 components such as
Wind Turbine Generator, Wind Turbine Tower, Wind Turbine foundation
structure inclusive of all substructures and appurtenances, Inter-array
cables, Offshore Substation topsides, Offshore substation foundation
structure inclusive of all substructures & appurtenances, and Export
cables.
Response: BSEE agrees and is finalizing the proposed language of
this section to allow and encourage separate FDR/FIR submittals of
integrated asset packages for added flexibility per Sec. 285.700(b).
Comment: A commenter suggested amendments to Sec. 585.700(c) to
[[Page 42666]]
incentivize a submittal for an early review before the COP approval.
This early review of the FDR and FIR for completeness would create
efficiencies in the BSEE engineering review and facilitate BSEE's
ability to complete its review within the 60-day period. The commenter
stated that this is critical for facilitating development post-COP
approval, as every day counts where developers are rapidly mobilizing
toward the commencement of offshore construction while making major
capital expenditures.
Response: BSEE disagrees with the suggestion to incentivize a
submittal for an early review before the COP approval. FDRs and FIRs
cannot be deemed submitted prior to approval of the COP, SAP, or GAP.
BSEE must ensure that the FDR and FIR remain within PDE, which is not
possible until plan approval.
BSEE is finalizing text proposed in Sec. 585.700(e), now in Sec.
285.700(e), to clarify that procurement of discrete parts of the
project, which are commercially available in standardized form or type-
certified components may take place prior to submittal of an FDR or
FIR. Also, fabrication activities that do not take place on the OCS
(e.g., manufacturing) may take place prior to the submittal of an FDR
or FIR. However, the developer assumes the risk that BSEE may not allow
equipment procured or fabricated prior to BSEE not objecting to the FDR
and FIR to be installed on the OCS. Procurement of discrete parts of
the project or onshore fabrication that begins prior to FDR or FIR is
still subject to CVA verification and may not be accepted later by
BSEE.
Comment: A commenter disagreed with the Department's proposed
changes, stating that these modifications degrade the EIS process by
allowing significant investment by energy development companies before
the Department can provide decisions on projects, which could lead to
conflicts of interest.
Response: BSEE disagrees with the commenter and is not revising the
rule based on this comment. The EIS is developed by BOEM, as the lead
Federal agency, not by an applicant. Likewise, the decision whether to
approve a project proposal described in a COP is a Federal decision
delegated to BOEM, not the applicant. BOEM and BSEE adhere to the NEPA
requirements at 40 CFR 1506.1(b) that limit actions within the agency's
jurisdiction during the review of an application from a non-Federal
entity and the concurrent NEPA process. Investment decisions by energy
development companies described by the commenter--such as investments
to other onshore infrastructure, to reserve manufacturing slots, or to
reserve vessels and equipment--are not within either bureau's
jurisdiction. Companies can choose to wait until BOEM completes the EIS
and issues a COP approval and/or until BSEE completes its review of the
FDR and FIR and does not object before making any significant
investments in procurement or fabrication. Procurement of discrete
parts of the project or onshore fabrication that begins is still
subject to CVA verification, which includes ensuring the facilities are
within what was approved in the COP, SAP, or GAP and the FDR, and may
not be accepted later by BSEE.
Comment: Commenters suggested that the Department make the
following revisions: (1) modify the rule to remove the use of the term
``type-certified'' as it is unclear what stage of type certification is
needed before permission is granted or include ``type-certified'' as a
definition in the final rule; (2) alternatively, introduce a definition
in Sec. 585.112 of type-certified to clarify what is meant by this
term. In that case, include that when used in these rules, type-
certified may describe components that are provisionally certified or
components that are in the process of type certification, so long as
the type certification is in place at time of final manufacturing; and
(3) simplify the approach by stating that the regulations impose no
restrictions on fabrication or procurement that does not occur on the
OCS.
Response: BSEE has revised the proposed language based on the
comment. Type-certified has been removed from the definition of
fabrication but remains in the Sec. 285.700 regulation to explain that
a type-certified component may be procured prior to FDR and FIR non-
objection. However, the developer assumes the risk that BSEE may not
allow equipment procured or fabricated prior to BSEE not objecting to
the FDR and FIR to be installed on the OCS. Any procurement or onshore
fabrication that begins prior to FDR or FIR is still subject to CVA
verification and may not be accepted later by BSEE. In this case, type-
certified means a full type-certification issued by an accredited type-
certifier. Type certification is process that is well understood and
using the word ``type certified'' instead of ``provisional type
certification'' clearly means that the full type certification has been
achieved. BSEE disagrees with the commenter's assertion of no
restrictions on fabrication and has not made any changes to reflect
this comment. There are important restrictions on fabrication and
procurement in that anything fabricated or procured prior to non-
objection of the FDR and FIR is done at the developers own risk as
explained above.
Comment: Several commenters suggested changes that would enable the
Department to approve separate FDRs and FIRs for major project
components. The commenters stated that these changes would encourage
developers to seek CVA review throughout their project design process
and would permit the use of specialized CVAs to verify specific project
components.
Response: The comments support the changes that BSEE has already
made. BSEE already allows and encourages separate FDR and FIR
submittals of integrated asset packages to allow for flexibility
pursuant to Sec. 285.700(b).
Comment: Another commenter expressed support for the proposed
modifications to the rule as it would allow for staged data submittal,
remove existing requirements that a lessee or grant holder begin to
fabricate and install only after the Department has notified the lessee
or grant holder that it has received the FDR and FIR and that it has no
objections, and define ``fabrication'' as ``cutting, fitting, welding
or other assembly or project elements of custom design conforming to
project specific requirements'' and excluding from the definition the
procurement of discrete parts of the project that are commercially
available in standardized form.
Response: The comment supports what the Department proposed and is
finalizing. BSEE is allowing staged submittal of FDRs and FIRs based on
integrated asset packages. BSEE still must review and not issue an
objection to both the FDR and FIR for an integrated asset package
before offshore fabrication or installation may begin. BSEE is also
clarifying that procurement of discrete parts of the project, which are
commercially available in standardized form or type-certified
components may take place prior to submittal of an FDR or FIR. Also,
fabrication activities that do not take place on the OCS (e.g.,
manufacturing) may take place prior to the submittal of an FDR or FIR.
However, the developer assumes the risk that BSEE may not allow
equipment procured or fabricated prior to BSEE not objecting to the FDR
and FIR to be installed on the OCS. Any procurement or onshore
fabrication that begins is still subject to CVA verification and may
not be accepted later by BSEE. BSEE also modified the definition of
fabrication to state that, ``Fabrication means the cutting, fitting,
welding, or other assembly of project
[[Page 42667]]
elements.'' The exclusions previously proposed in the definition are
now in the regulations at Sec. 285.700 but were not appropriate for a
definition.
Comment: A commenter suggested allowing offshore work to occur
within 60 days of notification of objection and removing the language
regarding additional requests for information in Sec. 585.700(f). The
term ``objection'' is not a defined term, so it allows the Department
to determine what necessitates an objection, which could be the request
for additional information.
Response: BSEE disagrees with the suggestion of a 60-day time
period. A lessee must resolve all objections before work may begin; the
timeframe for when offshore work may begin after notification of an
objection is dependent upon when sufficient information is sent to BSEE
to resolve the objection. If there are unresolved information needs,
BSEE will object. BSEE agrees with the commenter regarding removing
``requires additional information'' from Sec. 285.700(f) and has done
so in the final rule. BSEE will object if there are unresolved
information needs.
Comment: A commenter suggested including both ``iFIR'' and ``fFIR''
to reference initial and final FIRs.
Response: BSEE did not implement the commenter's suggestion and did
not include ``iFIR'' and ``fFIR'' as acronyms in the final rule. BSEE
will continue to use the acronym ``FIR'' and the phrase ``final
Fabrication and Installation Report'' because it sufficiently
distinguishes the two types of reports. BSEE will consider updating
this in future rulemakings.
Comment: A commenter requested clarification on the meaning of
``accepted industry or engineering standards'' in the reporting
requirements before installation in Sec. 585.700(e).
Response: Acceptable industry standards include national or
international standards that are fit for use in the United States OCS.
BSEE, in conjunction with the CVA, reviews the proposed industry
standards for use as part of the review process. BSEE did not make a
change to the proposed rule based on the comment.
Summary of final rule revisions:
The Department is finalizing the language in Sec. 285.700, as was
proposed Sec. 585.700, with clarifying revisions. Paragraph (a)
requires lessees to submit an FDR and FIR before installing facilities
in their approved COP, and, when applicable, their approved SAP or GAP.
Paragraph (b) allows lessees to submit separate FDR(s) and FIR(s) for
integrated asset packages and requires the FDR(s) and FIR(s) for
integrated asset package to be complete along with an explanation of
how the FDR or FIR will function effectively in an integrated manner
and a CVA verification of such integration. Paragraph (c) allows
lessees to submit their FDRs and FIRs before or after SAP, COP, or GAP
approval. Paragraph (d) allows lessees to commence fabrication and
installation of facilities, subject to the requirements in paragraph
(b), when (1) BSEE deems the lessee's report submitted before SAP, COP,
or GAP approval and notifies the lessee of its non-objection to the FDR
and FIR or does not respond within 60 business days of SAP, COP, or GAP
approval, or (2) BSEE deems the lessee's report submitted after SAP,
COP, or GAP approval and notifies the lessee of its non-objection to
the FDR and FIR or does not respond with objections within 60 business
days of the report being deemed submitted.
Paragraph (e) allows lessees to commence procurement of discrete
parts of the project that are commercially available in standardized
form and type-certified components, or fabrication activities that do
not take place on the OCS, prior to submitting the reports required
under paragraph (a) subject to CVA verification and certification. BSEE
retains authority to object to the installation of said components if
certain conditions are not met. The Department proposed changing the
word ``certification'' to ``verification'' in paragraph (e). After
review of comments and careful consideration, BSEE determined that
components fabricated before BSEE does not object to the FDR and or FIR
are subject to CVA verification and certification as required by
Sec. Sec. 285.701-285.714.
Under paragraph (f), BSEE will notify a lessee in writing within 60
business days of the report being deemed submitted if BSEE has an
objection(s). A lessee cannot commence fabrication or installation
activities on the OCS until all objections in such reports are resolved
to BSEE's satisfaction.
Within this provision, BSEE is clarifying that the 60-day FDR and
FIR review period in the existing regulation is 60 business days. BSEE
determined that a 60-business day review period, rather than the
proposed 60-calendar day review period, is necessary to ensure that
BSEE has sufficient time to review these complicated and lengthy
technical documents.
BSEE responded to comments concerning separating FDR(s) and FIR(s)
into integrated asset packages in Section III, D. above. Additional
comments and responses regarding this provision are provided below.
Sec. 285.701 What must I include in my Facility Design Report?
Summary of proposed rule provisions:
The Department proposed replacing the requirements for floating
turbines in the existing paragraph (b) with a reworded requirement in
proposed paragraph (a)(6). The Department proposed that the FDR include
the results of any detailed geotechnical surveys that were deferred as
a result of proposed Sec. 585.626(b)(1)(iii). Similarly, the
Department proposed that the FDR include the results of any
archaeological surveys that were deferred on a case-by-case basis under
proposed Sec. 585.626(b)(3). The Department proposed adding a
requirement in new paragraph (a)(12) for the lessee to include design
standards in the FIR. Also, the Department proposed a new requirement
in paragraph (a)(13) for the lessee to include information on critical
safety systems, including a risk assessment that identifies the
critical safety systems and a description of the identified critical
safety systems.
Finally, the Department proposed a catch-all category to cover
necessary project-specific information that may not be contained within
the listed categories. The Department also proposed to eliminate the
third column of the table in paragraph (a) as superfluous, given the
Department's proposed elimination of the paper copy requirement and to
replace that column's content with a new paragraph (b) consistent with
the proposed Sec. 585.110.
The remaining proposed changes were technical corrections and
included: removal of the word ``proposed'' from the project easement
requirement in paragraph (a)(2)(iii) because the project easement would
be approved already at the time of FDR review; substitution of
``verification'' for ``certification'' in the description of the CVA's
duties in addition to the CVA verification statement that the facility
has been designed to provide for safety, in keeping with other proposed
changes in Sec. 285.701(d); and removal of the trade secrets provision
in existing paragraph (e) as redundant of Sec. 285.113.
Summary of comments:
Comment: A commenter supported moving geotechnical data to the FDR.
Other commenters opposed moving the geotechnical data to the FDR
because of how it may impact the Department's environmental analysis.
Response: Both BOEM and BSEE revised proposed amendments to the
survey data requirements in the final rule and narrowed them to apply
only
[[Page 42668]]
to geotechnical survey data that are used for engineering purposes.
Geophysical and some geotechnical data that is needed for BOEM to
conduct their environmental analysis will still be submitted for the
COP. The geotechnical data submitted with the FDR will be used for the
site-specific engineering design.
BSEE finalized moving reports and supporting data from geotechnical
surveys, in situ explorations, laboratory tests, analyses, burial or
drivability assessments, and recommended design parameters to Sec.
285.701(a)(10).
Comment: Another commenter suggested that, although the proposed
rule change in Sec. 585.701(a) allows the lessee to propose
respectively design and fabrication standards specific to the project,
the proposed change does not present an acceptance criterion,
evaluation process definition, or the methodology used on the
validation of the proposed standards for the application. The commenter
recommended that the Department add language defining the acceptance
process to provide clarity to the regulation.
Response: Nationally and internationally recognized standards
included in the FDR and FIR are reviewed for design applicability and
conformance by the CVA and BSEE SMEs. The FDR and FIR should clearly
demonstrate the required performance criteria can be met and where the
standards were used to support the engineering design, accordingly,
BSEE has determined that additional clarity in the regulation is not
necessary.
Comment: Several commenters also suggested that the final rule
provide more flexibility than the proposed rule by stating that data
submitted after the COP approval is not required for the Facility
Design Report (FDR)/Facility and Installation Report (FIR) to avoid
delays in completion of the FDR/FIR process within 60 days.
Response: BSEE and BOEM determined that the amount of flexibility
proposed and incorporated into the final rule achieves the appropriate
balance between efficiency and the need to review site-specific
engineering design information. Site-specific geotechnical survey data
must be included in the FDR/FIR. The existing requirement to submit
site-specific geotechnical data at the COP stage under Sec. 585.626(a)
is being modified by both agencies, as proposed. BSEE and BOEM are
relocating review of this site-specific data from Sec. 585.626(a) to
Sec. 285.701(a). Moving this review from the COP to the FDR provides
efficiencies by aligning the information needs for site specific
information at the FDR with the requirements for the geotechnical
information. Geotechnical data not submitted in the COP is critical for
the site-specific engineering design and is therefore necessary in the
FDR to ensure the design is appropriate for the location in which it
will be installed.
Comment: A commenter requested additional guidance on how a CVA may
verify safety and suggested that a ``design-basis'' approach as
described in BOEM's 2020 COP Guidelines Attachment C could be applied.
Another commenter suggested that Sec. 585.701(a)(13) should be revised
to ``(i) A risk assessment that identifies the Critical Safety Systems
and Equipment with the exception of critical safety systems that are
incorporated in type approved components or facilities. (ii) A
description of the identified critical safety systems.''
Response: BSEE considered this comment but determined that the FDR
must contain site-specific engineering designs supported by codes and
standards, making a ``design-basis'' approach inappropriate. BSEE did
not make changes to the final regulation to incorporate a ``design-
basis'' approach.
BSEE also did not change Sec. 285.701 to exclude critical safety
systems that are incorporated in type-approved components or
facilities. In order to ensure the safety of workers on the OCS, BSEE
needs to understand all the critical safety systems and equipment on
the facilities, even if part of type-approved components. BSEE requires
that the FDR include a risk assessment that identifies hazards and
mitigations, which includes critical safety systems and equipment. Risk
assessment results should be integrated into the design, such that the
identified hazards have been reduced to an acceptable level of risk. No
change was made based on this comment.
Comment: A commenter expressed support for the submittal of certain
archaeological surveys with the FDR, stating that this would allow
flexibility and would allow lessees to tailor the survey program and
would reduce the number of surveys and reduce vessel time in the water
and associated environmental impacts. The commenter also requested that
the Department not extend engagement throughout the design process to
address stakeholder preferences.
Response: BSEE disagrees with the commenter's request to allow
lessees to postpone archaeological surveys to the FDR. The Department
received many comments opposing this, and the Department's subject
matter experts confirmed that not receiving full geophysical analysis
until the FDR would complicate BOEM's environmental reviews and
consultations. Upon review of the comments the Department determined
that all archaeological surveys will be required at the COP stage and
the proposed change to allow lessees to postpone archaeological
resources reports to the FDR was not finalized in Sec. 285.701(a) of
the final rule.
Comment: A commenter expressed disagreement with the note in the
proposed rule suggesting that delayed archaeological surveys could
lengthen the NHPA section 106 review process. The commenter asserted
that the proposed rule is in line with industry standards and suggested
that the Department clarify in the final rule whether any supporting
documentation would be required to get a survey strategy approved under
the performance-based standard.
Response: The Department's NPRM Sec. 585.626(b)(3) stated that
``[o]n a case-by-case basis and subject to terms and conditions of COP
approval per Sec. 585.628(f), BOEM may permit you to submit certain
surveys of the subsea portions of the area of potential effects with
your FDR per Sec. 585.701(a)(11).'' Upon consideration of comments
received, the Department is eliminating this language. The Department
agrees that sufficient geophysical data is necessary to assess
potential impacts from offshore wind activities on cultural resources
and the introduction of a case-by-case deferral of certain marine
archaeological surveys could create uncertainty for some parties
participating in consultations conducted according to section 106 of
the NHPA. BSEE has removed the referenced regulatory text in Sec.
585.701(a) from the finalized language in Sec. 285.701(a).
Comment: Another commenter stated that, although the proposed
change to Sec. 585.701(a) would allow the lessee to propose design and
fabrication standards specific to the project, the change does not
present an acceptance criterion, evaluation process definition, or the
methodology used on the validation of the proposed standards for the
application. The commenter recommended that the Department define the
acceptance process to provide clarity to the regulation.
Response: The Department is finalizing as proposed the flexibility
for proposing standards. The CVA and BSEE subject matter experts review
the national and international standards included in the FDR for design
applicability and conformance. The FDR should clearly demonstrate that
the
[[Page 42669]]
required performance criteria can be met and where the standards were
applied to support the engineering design.
BSEE declined to add specific criteria as industry standards are
changing and still being developed, especially U.S.-specific standards.
The CVA must review and agree that the standards are appropriate. BSEE
must have a chance to review the standards also.
Comment: A commenter expressed concern that the definition of
``critical safety systems'' is too vague and suggested several changes
to FDRs and FIRs to alleviate those concerns. Additionally, the
commenter requested that the Department clarify the content required
for FDRs and FIRs, and the approval process for separately submitted
FDRs and FIRs.
Response: Because technologies are constantly changing, BSEE has
determined that maintaining flexibility by requiring lessees to
identify Critical Safety Systems and Equipment on a project basis
through a risk assessment process is needed. Accordingly, BSEE has not
made any changes to the definition of ``Critical Safety Systems and
Equipment'' in Sec. 285.112 in response to this comment. The CVA must
oversee the risk assessment and associated results. Sections 285.701
and 285.702 clearly lay out BSEE's expectations for the content of the
FDR and FIR, respectively. The approval process for separate FDRs and
FIRs is the same as for a single FDR and FIR.
Comment: A commenter requested that the Department revise
Sec. Sec. 585.701(a)(12) and 585.105 to require only the most relevant
industry standards that apply to the project be submitted in the FDR
and FIR. The commenter also suggested BSEE should remain the authority
to determine if a sufficient level of detail is covered in the
submitted standards.
Response: BSEE is not revising Sec. 285.701 to require only the
most relevant industry standards because ``most relevant'' is an
ambiguous term. BSEE will consider updates to standards requirements in
future rulemakings.
Comment: A commenter stated that there is ambiguity in the content
required in the FDR and FIR and suggests that the Department remove the
requirement that CVA's must conduct independent assessments of other
pertinent parameters of proposed designs.
Response: BSEE provides the requirements of what must be included
in an FDR in Sec. 285.701 and in an FIR in Sec. 285.702. Designs are
constantly changing so the need to require an ``independent assessment
of other pertinent parameters of proposed designs'' is necessary to
ensure there is sufficient information to verify the safety of the
proposed design.
Comment: A commenter suggested deleting ``catch-all'' provisions in
the list of FDR and FIR content requirements Sec. Sec. 585.701(a)(14)
and 585.702(a)(10).
Response: The provisions list a requirement to include other
information in Sec. Sec. 285.701(a)(13) and 285.702(a)(10) because
technologies are constantly changing and BSEE must be able to request
information to verify the safety of the proposed design. Accordingly,
BSEE is not deleting these provisions.
Summary of final rule revisions:
The Department is finalizing the language in proposed Sec.
585.701, including revisions to paragraphs (a)(1) through (10); the
addition of paragraphs (a)(11) through (13); and removal of paragraph
(e). BSEE is revising paragraphs (a)(4), (6), and (9) to include
``tendon''. The revisions address how the design report demonstrates
that the design conforms to key responsibilities listed in Sec.
285.105(a) and the required documents in the report; require submission
of an FDR to BSEE pursuant to Sec. 285.110 and identification of the
location of records; and include a certification statement with
accompanying justification in the FDR if the lessee is required to use
a CVA.
BSEE is not finalizing the removal of the reference to the U.S.
Coast Guard for structural integrity and stability in paragraph (b).
Geotechnical information, previously submitted as part of the COP,
is revised to be submitted as part of the FDR pursuant to Sec.
285.700(a)(10). The Department proposed to change the term
``certified'' to ``verified'' in paragraph (d). BSEE determined that
certified is the proper term in this regulation as certified describes
how the CVA ``recognizes that (someone or something) possesses certain
qualifications or meets certain standards.'' See Sec. 285.700 above
for a more detailed discussion of the use of the words
``certification'' and ``verification.''
BSEE responded to comments concerning FDR(s) and FIR(s) in Section
III, D. above. Additional comments and responses regarding this
provision are provided below.
The provisions in this final rule do not change or purport to
change any other Federal agencies' regulatory requirements, including
the USCG's regulations governing integrity and stability of floating
facilities.
Sec. 285.702 What must I include in my Fabrication and
Installation Report?
Summary of proposed rule provisions: The Department proposed adding
a requirement in proposed paragraph (a)(6) that lessees and grant
holders submit any certificates documenting that they are adhering to a
recognized quality assurance standard. The Department also proposed to
clarify that any environmental information contained in a previously
submitted corresponding plan may be incorporated by reference in an FIR
to the extent that information satisfies the requirements of proposed
paragraphs (a)(7)(i) through (iv). The Department also proposed to add
a requirement in paragraph (a)(8) for the submittal of commissioning
procedures for critical safety systems. The Department also proposed to
eliminate the third column of the table in paragraph (a) as superfluous
given the Department's proposed elimination of the paper copy
requirement and to replace that column's content with a new paragraph
(b) consistent with the proposed Sec. 585.110. The proposed paragraph
(c) would provide clarity and add flexibility regarding project
easement information submittals and requests. Finally, as with its
proposed changes to the FDR requirements in Sec. 585.701, the
Department proposed a catch-all category for necessary project-specific
information that may not be covered by the listed categories.
Summary of comments:
Comment: A commenter suggested that the Department revise Sec.
585.702(a)(3) from ``The industry standards you will use to [. . .]''
to ``A listing of the most relevant industry standards you will use to
[. . .].''
Response: BSEE is not revising Sec. 285.702 to require only the
most relevant industry standards because ``most relevant'' is ambiguous
and does not provide the regulated community with sufficient certainty
and clarity.
Comment: A commenter requested that language be amended in Sec.
585.702(a)(8) to remove ``other BOEM approved procedures'' to improve
clarity.
Response: BSEE agreed with the commenter that improved clarity was
necessary but implemented the edits differently than the commenter
proposed. BSEE revised Sec. 285.702(a)(8) from ``other BOEM approved
procedures'' to ``other BSEE accepted engineering practices.'' BSEE
made this revision to allow not only the use of OEM procedures, but
also other procedures that have been developed by a qualified
individual for the specific equipment in the specific location where it
will be used or installed.
[[Page 42670]]
Comment: A commenter suggested removing requests for project
easements submitted as part of the FIR as they are pursuant to the COP
approval and not relevant to request at the FIR stage.
Response: BSEE has removed requests for project easements submitted
as part of the FDR from its regulations. BOEM has jurisdiction over the
issuance of project easements.
Comment: A commenter suggested allowing flexibility in the final
rule for commissioning procedures and documentation to be reviewed in
the execution phase and submitted as part of the FIR rather than
requiring commissioning documentation with the FIR.
Response: BSEE is not making a revision to the final rule based on
this comment because there is currently no report during the execution
phase where BSEE could move this requirement. The commissioning
procedures remain part of the FIR review, but BSEE will consider this
in future rulemakings. Information on the commissioning of the Critical
Safety Systems and Equipment must be submitted after commissioning
takes place.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.702. BSEE is revising paragraphs (a)(1) through (7);
removing the existing paragraph (d); redesignating existing paragraphs
(b) and (c) as paragraphs (c) and (d), respectively; adding paragraphs
(a)(8) through (10) and (b); and revising the newly redesignated
paragraph (d). The revisions add new required documents in the
fabrication and installation report, including quality assurance
information in paragraph (a)(6), commissioning procedures for Critical
Safety Systems and Equipment in paragraph (a)(8), and other information
in paragraph (a)(10). BSEE also made administrative edits to new
paragraph (b) about requiring lessees to submit their FIR to BSEE
pursuant to Sec. [thinsp]285.110; redesignated paragraph (c) about
providing the location of records, as required in Sec. 285.714(c); and
to redesignated paragraph (d) about including a certification statement
with accompanying justification in the FIR if the lessee is required to
use a CVA.
Paragraph (c), as proposed in the NPRM, was removed because
requests for project easements must be submitted to BOEM and not as a
part of the FIR.
The NPRM proposed to replace the term ``certified'' with
``verified'' in redesignated paragraph (d). After review of comments
and careful consideration, BSEE determined that the term ``certified''
is the proper term in this regulation because certified describes how
the CVA ``recognizes that (someone or something) possesses certain
qualifications or meets certain standards.''
BSEE removed the trade secrets provision in existing paragraph (d)
as redundant of Sec. 285.113.
BSEE responded to comments concerning FDR(s) and FIR(s) in Section
III, D. above. Additional comments and responses regarding this
provision are provided below.
Sec. 285.703 What reports must I submit for project modifications
and repairs?
Summary of proposed rule provisions:
The Department proposed to eliminate language in paragraph (a)
indicating that major repairs or modifications must be ``certified,''
consistent with the proposed changes to Sec. Sec. 585.701 and 585.702.
The Department proposed that any major modification or repair report
contain a CVA verification statement analogous to the one required for
FDRs in Sec. 585.701 and for FIRs in Sec. 585.702. The Department
also proposed to clarify the definition of a ``major repair'' in
paragraph (a)(1) to include substantial repairs to critical safety
systems and the definition of a ``major modification'' in paragraph
(a)(2) to include a substantial alteration of a critical safety system.
The Department proposed to determine the completeness of the
application before its review period begins. The proposed rule provided
that the Department will have 20-calendar days to make this
determination. The Department proposed to add this regulation to
clarify that the reports (e.g., FDR, FIR, and project verification
reports) must be deemed submitted before the 60-calendar day or 30-
calendar day review period begins.
Summary of comments:
Comment: A commenter suggested that Sec. 585.703(a) should clarify
that ``major repairs and major modifications'' refer to project
modifications post-installation.
Response: BSEE agrees that project repair and project modification
reports are intended to apply to major post-installation repairs and
modifications. BSEE has internal procedures to review modifications
during FDR or FIR review and prior to facility installation outside of
Sec. 285.703(a), which are communicated to the lessee as applicable.
BSEE is not making any revisions to the final rule based on this
comment but may consider updates in future rulemakings.
Comment: A commenter requested that the Department further define
the extent of what is considered ``substantial'' in Sec. 585.703(a)(1)
and (2).
Response: BSEE is declining to make a specific definition of
``substantial'' in this regulation but may consider this in future
rulemaking.
Summary of final rule revisions:
The Department is finalizing paragraphs (a) and (c), consistent
with proposed Sec. 585.703. The revisions in paragraph (a) require a
lessee to submit to BSEE a Project Modification or Repair Report, in
which it certifies that major repairs and major modifications to a
completed project conform to accepted engineering practices. The
definitions of the terms ``major repair'' and ``major modification''
are also revised to include ``substantial repair'' and ``substantial
alteration'', respectively.
The NPRM proposed to replace the term ``certified'' with
``verified'' in paragraph (c). After review of comments and careful
consideration, BSEE determined that the term ``certified'' is the
proper term in this regulation because certified describes how the CVA
``recognizes that (someone or something) possesses certain
qualifications or meets certain standards.''
Sec. 285.704 After receiving the FDR, FIR, or project verification
reports, what will BSEE do?
Summary of proposed rule provisions: Over the past few years, BOEM
received numerous incomplete COPs and other documents that it could not
properly evaluate. This created many issues between the lessees and
BOEM with respect to the status of the applications. To address this,
the Department proposed making a determination as to the completeness
of the application before its review period begins. The proposed rule
provided that the Department will have 20-calendar days to make this
determination. The Department proposed making a determination that if
any given report is sufficiently accurate and complete, it would deem
it submitted, which would begin the applicable period of time for the
Department to review and object, as necessary. The Department proposed
to add this regulation to clarify that the reports (e.g., FDR, FIR, and
project verification reports) must be deemed submitted before the 60-
calendar day or 30-calendar day review period begins.
Summary of comments:
Comment: A commenter suggested that the Department remove the 20-
day limit for a completeness review of the FDR, FIR, and PVR as the
Department already reserves the right to pause the review period if the
report is incomplete.
Response: FDR and FIR packages can include hundreds of documents.
Adequate time is needed to ensure the
[[Page 42671]]
packages are complete to decrease the likelihood of an objection at the
end of the review period due to missing or incomplete information.
Comment: A commenter requested clarification on how the
completeness review differs from the formal review, particularly
related to the non-objection periods and if they can overlap.
Response: BSEE conducts a completeness review to ensure that the
bureau has all the information needed prior to beginning its official
review. The purpose of the completeness review is to prevent objections
based on missing or incomplete information. The completeness review and
formal review periods cannot overlap.
Comment: A commenter suggested revising the final rule to state
that ``FDRs and FIRs could be deemed submitted by BOEM before SAP COP
or GAP approval if submitted more than 20 calendar days prior to SAP
COP or GAP approval.''
Response: FDRs and FIRs cannot be deemed submitted prior to
approval of the COP, SAP, or GAP. BSEE must ensure that the FDR and FIR
remain within the PDE, which is not possible until plan approval.
Comment: A commenter requested clarification on the requirements
for PVR submission being ``deemed submitted,'' which the commenter
asserted conflicts with the regulation that allows developers to
commence operations after the Department receives the PVR. The
commenter also requested clarity on if Critical Safety Systems
commissioning records only require confirmation of receipt rather than
being ``deemed submitted.''
Response: BSEE revised Sec. 285.637 so that a final PVR is not
required to be submitted before commercial operations. The PVR will be
deemed submitted once BSEE determines the PVR is sufficiently complete
and accurate pursuant to Sec. 285.704. Commissioning records do not
need to be ``deemed submitted.''
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.704, with revisions, to
address what BSEE will do to (1) determine whether the FDR, FIR, or
project verification report is deemed submitted (paragraph (a)); (2)
identify problems and deficiencies in the reports (paragraph (b)); and
(3) notify a lessee that a report is deemed submitted (paragraph (c)).
BSEE revised the timeframes in the proposed rule from 20 calendar days
to 20 business days for when BSEE deems a report submitted or notifies
a lessee of problems or deficiencies. BSEE determined that a 20-
business day review period, rather than the proposed 20-calendar day
review period, is necessary to ensure that BSEE has sufficient time to
review these highly complex and lengthy technical documents. BSEE has
at times received over 700 documents for a single FDR or FIR.
Sec. 285.705 When must I use a Certified Verification Agent (CVA)?
Summary of proposed rule provisions: The Department proposed
allowing the use of multiple CVAs on a project in paragraph (a). The
Department also proposed several modifications, clarifications, and
technical corrections to this section. First, the Department proposed
adding a requirement in paragraph (b) for the CVA to ensure critical
safety systems are commissioned in accordance with the procedures
identified in the FIR. Second, the Department proposed clarifying in
paragraph (a) that the CVA requirement applies unless it is waived
under paragraph (c) of this section. Third, the Department proposed in
paragraph (c) to clarify that, just as multiple CVAs may be nominated
for different project elements, the Department may grant partial
waivers of the CVA requirement for discrete elements of a project.
Fourth, in paragraph (c) the proposed rule substituted ``fabricator'
and ``fabricated'' for ``manufacturer'' and ``manufactured'',
respectively, to avoid confusion and maintain consistency with Sec.
585.700. Fifth, in paragraph (c) the proposed rule added a requirement
that fabrications, repairs, or modifications that are the subject of a
CVA waiver nonetheless must adhere to a recognized quality assurance
standard. Sixth, the proposed rule eliminated the requirement that
waiver requests be submitted with plans, thus relieving the Department
of the obligation to consider such waiver requests as part of its plan
reviews. Finally, the proposed rule replaced the term ``certify'' with
``verify'' in paragraph (a).
Summary of comments:
Comment: Several commenters disagreed with the proposed changes to
the CVA requirements because they determined the changes may lead to a
reduction in safety and recommended that the Department carefully
consider possible concerns about impacts to mariners. A commenter
opposed the proposed waiver process for a CVA and use of a lessee's
engineer because they viewed the project engineer designation as a
lessening of responsibility and was concerned about conflicts of
interest in reviewing components.
Response: BSEE now regulates CVA roles and responsibilities and
defines the role of the CVA in Sec. Sec. 285.707 and 285.708. Changes
to the rule on CVA roles and responsibilities will not reduce the level
of safety on a project, including to mariners or other OCS users,
because the CVA must meet BSEE requirements for qualifications and
experience, and the CVA's scope of work will address safety concerns
through commissioning of the facility. BSEE will rigorously review any
request for waiver of the CVA requirement to ensure there is no
reduction in safety prior to accepting the use of a project engineer.
BSEE has also made the waiver requirements more stringent by
requiring that waiver requests be submitted in writing to BSEE. If BSEE
waives the requirement for a CVA, lessees must demonstrate that their
project engineer can perform the same duties and responsibilities as
the CVA. Also, the project engineer's qualifications must be submitted
to BSEE as a part of the waiver request to demonstrate that the project
engineer is a professional engineer with relevant experience and
expertise in the facilities they will be verifying or certifying.
Comment: A commenter requested that the Department clarify the
phrase ``all incidents'' that affect the design, fabrication, and
installation of the project and its components that the CVA is required
to report. The commenter further requested that the proposed rule shift
the burden of reporting incidents from the CVA to the lessee, who has
site control, and allow a CVA to verify any modifications needed to
address the incident.
Response: BSEE intends the phrase ``Incidents that affect the
design, fabrication, and installation of the project and its
components'' to be broadly applicable so that it includes, but is not
limited to, design changes or events that occur before the final PVR
that affect the design, fabrication, or installation of the project or
its components such that the original design envelop, standards, or
functionality has been changed from what was originally reviewed.
The regulations at Sec. 285.705(a)(3) require the lessee to use
CVA(s) to immediately notify BSEE of incidents that affect the design,
fabrication, and installation of the project and its components. The
lessee is also responsible for reporting certain incidents as required
in Sec. Sec. 285.815 and 285.831, and the lessee is responsible for
accepting any fabrication or installation modifications and notifying
BSEE as provided in Sec. 285.703.
BSEE ensures that the lessee upholds its reporting requirements
(including the requirement to use a CVA to report
[[Page 42672]]
certain incidents) and can take enforcement action if the lessee fails
to meet these requirements. The use of the CVA for reporting incidents
as a part of their oversight responsibilities enables their
participation in evaluating such incidents and providing an independent
analysis to BSEE and is thus preferable to having the lessee solely
report incidents.
Comment: Commenters requested that the Department further clarify
the role of the CVA in verifying a facility's safety by incorporating
appropriate consideration for human and occupational safety through
verification of adherence to industry codes and standards to ensure
there is not confusion about how a CVA may review a facility.
Response: BSEE has declined to incorporate new standards into these
regulations because BSEE has determined that the proposed processes
adequately account for human health and occupational safety. Human and
occupational safety must be considered during the risk assessments that
identify the Critical Safety Systems and Equipment as is required by
Sec. 285.701(a)(12). The CVA will review the risk assessments for
adequacy, will certify adherence to the standards identified within the
FDR and FIR, and will certify that the risk assessment outcomes have
been integrated into the project design. BSEE will also review the FDR
and FIR submissions to ensure that appropriate standards are being
utilized.
Comment: A commenter discussed the need for a CVA to verify any
self-inspection plans submitted for facilities in development.
Response: BSEE has declined to make CVAs verify self-inspection
plans. The role of a CVA is to oversee design, fabrication, and
installation. The CVA reports often make recommendations regarding
inspections, and BSEE will consider those recommendations when BSEE
reviews a lessee's self-inspection plan.
Summary of final rule revisions:
The Department is finalizing paragraphs (a) through (d), consistent
with proposed Sec. 585.705, with minor revisions. Paragraph (a) allows
lessees to use one or more CVAs, if approved by BSEE. Paragraph (b)
adds a responsibility for the CVA to ensure that the facility design is
suitable for the location where it will be installed, which was
included in the preamble to the NPRM and is necessary to ensure
personnel safety over the life of the project. Paragraph (b) also
finalizes the other CVA responsibilities from the NPRM. In the preamble
to the proposed rule, the Department explained its expectations that
the CVA would ensure that the design of the facilities is suitable for
the location where they will be installed. BSEE determined it was
prudent to include this expectation in the final rule in paragraph
(b)(1). Paragraph (c) allows BSEE to waive all or part of the
requirement for a lessee to use a CVA for the design of a structure if
the lessee can demonstrate that the facility conforms to a standard
design that has been successfully used in a similar environment, and
the installation design conforms to accepted engineering practices.
Paragraph (c) also allows BSEE to waive all or part of the requirement
for a lessee to use a CVA for the fabrication or installation of a
structure if the lessee can demonstrate the relevant fabricator or
installation company, as applicable, has successfully fabricated or
installed similar facilities in a similar offshore environment, and the
facility will be fabricated or installed in conformance with accepted
engineering practices and to a nationally or internationally recognized
quality assurance standard. A similar waiver is available for a CVA for
project modification or repairs. Paragraph (d) requires that waiver
requests be submitted in writing to BSEE. If BSEE waives the
requirement for a CVA, lessees must demonstrate that their project
engineer can perform the same duties and responsibilities as the CVA.
Also, the project engineer's qualifications must be submitted to BSEE
as a part of the waiver request to demonstrate that the project
engineer is a professional engineer with relevant experience and
expertise in the facilities they will be verifying/certifying.
BSEE responded to comments concerning CVAs in Section III, D.
above. Additional comments and responses regarding this provision are
provided below.
Sec. 285.706 How do I nominate a CVA for BSEE approval?
Summary of proposed rule provisions:
The Department proposed eliminating the requirement that a lessee
or grant holder nominate a CVA with its COP, SAP, or GAP and, instead,
proposed that a CVA be nominated and approved before conducting the
relevant verification activities. The Department also proposed
requiring that if a lessee or grant holder seeks to use multiple CVAs,
it must nominate a general project CVA no later than COP submittal to
manage the project verification strategy, to ensure CVAs are conducting
their reviews in a consistent manner, and to oversee the transition
areas between various project components and their associated CVAs.
The Department also proposed clarifying that the nominated CVA must
not have been involved in preparing the plans, reports, analyses, or
other technical submittals that it will verify.
Summary of comments:
Comment: A commenter expressed support for the CVA role revisions
and the approval of CVA nomination prior to COP submittal to create
flexibility for lessees and the Department.
Response: The CVA nomination approval occurs within BSEE's
oversight, therefore, is not tied to the COP.
Comment: A commenter opposed the use of multiple CVAs for various
components insofar as it could lead to inconsistencies in the
verification of a project.
Response: If multiple CVAs are used on a project, BSEE will require
one CVA to oversee the entire facility design, fabrication, and
installation and to ensure continuity across all project components.
Comment: Several commenters suggested adding language to indicate
that the CVA scope of work must be in accordance with project
certification schemes generally accepted and used in industry, such as
International Electrical Code Renewable Energy (IECRE) OD-502.
Response: BSEE declines to incorporate any specific project
certification standard, such as IECRE OD-502. Instead of requiring a
specific project certification standard such as IECRE OD-502, BSEE
allows the lessee and CVA to specify the project certification standard
they would like to use as part of the CVA nomination. BSEE can accept
or deny the proposed certification standard. This allows BSEE to remain
flexible and adaptable as these standards continue to evolve. BSEE will
evaluate the CVA scope of work and ensure that the scope of work fully
describes the CVA's verification and certification strategy.
Comment: A commenter also requested that the Department clarify the
responsibility of a General Project CVA to avoid conflicts and
misunderstandings that may result in the incorrect completion or non-
performance of verification tasks.
Response: BSEE has determined that the finalized language in Sec.
285.706(a) clearly establishes the responsibilities of the general
project CVA. When multiple CVA's are nominated for a project, a general
project CVA must be nominated to manage the overall project
verification and certification approach and ensure consistency between
and oversight of the other CVAs, especially
[[Page 42673]]
in transition areas between different CVAs.
Comment: A commenter suggested that the Department adopt an
independent process to review and approve a company's credentials for
CVA nomination rather than the project-specific approach proposed by
the Department, to decouple CVA nomination from the project approval
processes and encourage new participants in the CVA market.
Response: BSEE declined to adopt an independent process to review
and approve a company's credentials for CVA nomination because BSEE
reviews each CVA nomination to make sure that the nominated CVA has the
technical expertise, experience, and capacity for the specific project.
A specific company may be an acceptable CVA for one project and not
another depending on the technologies involved in the project,
technical expertise of the company, number of projects the company is
overseeing, and several other factors. BSEE will continue to review the
CVA nomination for each specific project.
Comment: A commenter provided specific regulatory text revisions
regarding when a CVA is needed on a project and how to nominate a CVA
for the Department's approval, including a suggestion that CVAs may
periodically monitor fabrication and installation of a facility and
utilize type-approved procedures rather than ``proper'' procedures to
verify a design.
Response: BSEE agrees that the procedures used and validated during
the type-approval process should be used for type-approved components.
For other components, OEM procedures should be used when applicable.
The frequency of the CVAs oversight will be agreed to in the CVA scope
of work. BSEE declined to state that the CVA would only periodically
monitor fabrication and installation because the word ``periodically''
can be interpreted differently. Instead, BSEE expects the CVA to
clearly state their plans for witnessing of fabrication and
installation activities in the CVA scope of work.
Summary of final rule revisions:
The Department is finalizing paragraphs (b)(2) and (7), (c), and
(d), consistent with proposed Sec. 585.706. BSEE is removing Sec.
285.706(e) because the Reorganization Rule transferred authority for
approving a CVA from BOEM to BSEE. The changes in paragraph (a) require
that a CVA be nominated by the lessee and approved by BSEE prior to
conducting any verification or certification activities. If a lessee
intends to use more than one CVA, then a general project CVA must be
nominated to manage the overall project verification and certification
approach to ensure consistency and oversight among the other CVAs,
especially in transition areas between different CVAs. Paragraphs
(b)(2) and (7) address the technical capabilities of individuals
involved in a project and the scope and level of work to be performed
by the CVA, respectively. Paragraph (c) addresses CVAs' potential
conflicts of interest by prohibiting CVAs from preparing or being
directly involved in any work related to the preparation of design,
fabrication, installation, modification, or repair plans for which they
will provide verification or certification services. Lastly, paragraph
(d) requires that verification and certification be conducted by or
under the direct supervision of a registered professional engineer.
BSEE responded to comments concerning CVAs in Section III, D.
above. Additional comments and responses regarding this provision are
provided below.
Sec. 285.707 What are the CVA's primary duties for facility design
review?
Summary of proposed rule provisions: The Department proposed
changing ``certify'' to ``verify'' in this section. The Department also
proposed replacing the requirements for floating turbines in the
existing paragraph (c) with a reworded requirement in proposed
paragraph (b)(10). The Department also proposed requiring the CVA to
verify that the facility has been designed to provide for safety and to
conduct an independent assessment of the design for human safety and
accident prevention.
Summary of comments:
Comment: Several commenters expressed support for the proposed
revisions to the role of a Certified Verification Agent (CVA), stating
that the revisions align with best engineering practices and the
Department's policy goals of encouraging safety.
Response: BSEE agrees with the commenters and is defining the role
of the CVA in Sec. Sec. 285.707 and 285.708 that the CVA's oversight
of both design and fabrication and installation through verifications
and certifications in order to enhance safety.
Comment: A few other commenters stated that the change to
``verification'' rather than ``certification'' promotes safety
throughout the development process.
Response: The CVA plays a role in both design and fabrication and
installation through verifications and certifications. After reviewing
commenters' feedback and considering various relevant standards and
references, BSEE understands that the terms ``verification'' and
``certification'' are not consistently defined across published
standards. Accordingly, BSEE is defining each term based on the Oxford
Dictionary and contextual usage in relevant standards. The terms
``certify'' or ``certification'' describes how the CVA ``recognizes
that (someone or something) possesses certain qualifications or meets
certain standards.'' BSEE may require a CVA to ``certify'' that a
design or safety component conforms to a defined certification protocol
based on criteria from specific quality assurance standards or
recognized accepted engineering practices. The terms ``verify'' or
``verification'' describes how the CVA demonstrates that something is
true, accurate, or justified.
BSEE has evaluated each of the CVAs actions, as required by the
regulations, and updated the regulations to use the appropriate term.
Comment: A commenter stated that the removal of mooring and
anchoring systems from CVA verification is an increase to risk and
safety of a project and requests that the Department reinstate the
requirement.
Response: BSEE agrees with the commenter. Any mooring or anchor
system that supports a floating wind turbine will require CVA
verification as according to Sec. Sec. 285.707 through 285.709. The
proposed Sec. 285.707(b)(10) was removed and Sec. 285.707(c) will
remain in the regulations. Section 285.707(c) explicitly requires CVA
oversight of the design of systems related to structural integrity,
stability, ballast, foundations, foundation pilings, templates,
anchoring systems, mooring, tendon, and tethering systems.
Comment: A commenter suggested that the Department remove the
requirement that CVAs must conduct independent assessments of other
pertinent parameters of proposed designs.
Response: BSEE declines to make a revision to the regulation based
on this comment. BSEE does expect the CVA to conduct an independent
assessment for other pertinent parameters of the design. Designs are
changing frequently and the CVA must be able to adapt to these changes.
Summary of final rule revisions:
The Department is finalizing this regulation consistent with
proposed Sec. 585.707, with a few minor revisions. BSEE is revising
this regulation to make minor changes to the description of the CVA's
duties in Sec. 285.707(a), to ensure that the facility is designed to
withstand the environmental and functional load
[[Page 42674]]
conditions and to minimize risk to personnel as required by Sec.
285.105(a). BSEE also determined that the term ``verify'' is more
appropriate than ``certify,'' as proposed in the NPRM, in this context
and has made the appropriate regulatory text change. BSEE added a
requirement to the CVA's duties for design review in 285.707(b). The
CVA must now assess the lessee's risk assessments supporting the design
for human safety and how the results are used in the design. Section
285.707(c) will remain in the regulation to ensure that the CVA
verifies the design of floating facilities for structural integrity and
stability. The design must also consider 1) foundations, foundation
pilings, templates, anchoring systems, and 2) mooring, tendon, and
tethering systems. BSEE is revising paragraph (c)(3) to include
``tendon''.
BSEE responded to comments concerning CVAs in Section III, D.
above. Additional comments and responses regarding this provision are
provided below.
The provisions in this final rule do not change or purport to
change any other Federal agencies' regulatory requirements, including
the USCG's regulations governing integrity and stability of floating
facilities.
Sec. 285.708 What are the CVA's or project engineer's primary
duties for fabrication and installation review?
Summary of proposed rule provisions:
The Department proposed updating paragraphs (a)(5) and (b) by
replacing the terms ``certify'' and ``ensure'' with ``verify'' for
consistency with the proposed changes to the CVA standard of review.
The Department proposed adding a requirement in paragraph (a)(1) that
the commissioning of critical safety systems should be consistent with
Sec. 585.705 and to require that the CVA monitor the commissioning of
critical safety systems in paragraph (a)(2). The Department proposed
adding paragraph (a)(6) to require that the CVA provide records
documenting that critical safety systems are commissioned in accordance
with the procedures identified in Sec. 585.702(a)(8) and to identify
the location of all records pertaining to commissioning of critical
safety systems, as described in Sec. 585.714(c).
Additionally, the proposed rule would add language regarding
quality assurance standards to ensure consistency with Sec.
585.702(a)(6). The Department also proposed moving the requirement in
paragraph (a)(5)(ii) to Sec. 585.637. The Department proposed
requiring that if multiple CVAs are used--thus necessitating multiple
verification reports for different project components--the general
project CVA must submit the final verification report for the entire
project prior to the commencement of commercial operations under Sec.
585.637.
Summary of comments:
Comment: A commenter suggested that the Department formalize the
Project Verification Report using a consistent term, ``PVR.''
Response: BSEE includes the minimum requirements of a project
verification report in Sec. 285.708. BSEE also revised Sec. Sec.
285.637, 285.702, 285.704, and 285.708 to consistently use the term
``project verification report.''
Comment: Commenters suggested that the Department add the word
``material'' to certain CVA requirements in Sec. 585.708(b) to ensure
focus on relevant changes rather than all potential changes.
Response: BSEE has decided not to add the term ``material'' in
Sec. 285.708 because ``material'' is not a sufficiently definite term.
BSEE will engage with the CVAs to ensure our expectations for reporting
changes during fabrication and installation are met and BSEE may issue
guidance if additional clarifications are necessary.
Comment: A commenter supports the change from ``certification'' to
``verification'' but stated concern with the overall approach of the
proposed part 285 when compared to similar processes in 30 CFR part 250
regarding technical requirements. The commenter stated that there is an
inconsistency between the CVA verification and the language describing
a statement within the FDR/FIR that a CVA has verified various
components. The commenter requested that clear guidance be provided
from BSEE on the expectations of CVA reviews of reports.
Response: BSEE has evaluated each use of the terms
``certification'' and ``verification,'' and has revised the regulations
to ensure each term is used appropriately and consistently. Within this
context, the terms ``certify'' or ``certification'' describe how the
CVA ``recognizes that (someone or something) possesses certain
qualifications or meets certain standards.'' BSEE may require a CVA to
``certify'' that a design or safety component conforms to a defined
certification protocol based on criteria from specific quality
assurance standards or recognized accepted engineering practices. The
terms ``verify'' or ``verification'' describe how the CVA demonstrates
that something is true, accurate, or justified. BSEE has evaluated each
of the CVAs actions required by the regulations and revised the
regulations to use the appropriate term.
BSEE has reviewed the regulations and has determined that the
finalized version here provides clear expectations regarding CVA
reviews of reports. BSEE will engage with the CVAs to ensure our
expectations for reporting changes during fabrication and installation
are met and BSEE may issue guidance if additional clarifications are
necessary.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.708, with minor revisions. BSEE is revising
paragraphs (a)(1), (2), and (5); adding paragraphs (a)(6) and (7); and
revising paragraph (b).
BSEE is not finalizing the proposed paragraph (a)(5)(ii) because
requirements for the commencement of commercial operations have been
moved to Sec. 285.637. BSEE also determined that the term ``certify''
is more appropriate than ``verify'' in this context and has made the
appropriate regulatory text change as explained in comments above.
The revisions to paragraphs (a)(1), (2), and (5) update
expectations for the CVA's oversight of fabrication and installation.
Specifically, the CVA must use good engineering judgment and practice
in conducting an independent assessment of the commissioning of
Critical Safety Systems and Equipment and monitor the commissioning of
Critical Safety Systems and Equipment. Paragraph (a)(5) requires the
CVA to certify in Project Verification Reports that project components
are fabricated and installed in accordance with accepted engineering
practices and to a nationally or internationally recognized quality
assurance standard or to an equivalent alternate means of quality
assurance considered on a case-by-case basis, your BOEM-approved SAP,
COP, or GAP (as applicable), and your FIR. The Project Verification
Reports must also identify the location of all facility fabrication and
installation records. Paragraph (a)(6) requires CVAs to provide records
documenting Critical Safety Systems and Equipment are commissioned in
accordance with the procedures identified in Sec. 285.702(a)(8).
Paragraph (a)(7) require CVAs to identify the location of records
pertaining to the commissioning of Critical Safety Systems and
Equipment as required in Sec. 285.714(c).
Paragraph (b) now requires the CVA or project engineer to monitor
the fabrication and installation of the facility and the commissioning
of Critical Safety Systems and Equipment to certify that it has been
built and installed according to the lessee's
[[Page 42675]]
FDR(s) and FIR(s). Additionally, under paragraph (b)(1), the CVA or
project engineer must inform the lessee and BSEE if either fabrication
and installation procedures or Critical Safety Systems and Equipment
commissioning procedures, or both, have been changed or design
specifications have been modified. Under paragraph (b)(2), The CVA or
project engineer must inform BSEE of any modifications they accept.
BSEE responded to comments concerning CVAs in Section III, D.
above. Additional comments and responses regarding this provision are
provided below.
Sec. 285.709 When conducting onsite fabrication inspections, what
must the CVA or project engineer verify?
Summary of proposed rule provisions: The Department proposed
revising this section to mirror the proposed changes to Sec. 585.701
by modifying paragraph (b) to remove the references to the U.S. Coast
Guard and by specifying the CVA must verify the structural integrity,
stability, and ballast of a floating facility. The Department also
proposed modifying paragraph (b) to remove the requirement for
consideration of foundations, foundation pilings and templates, and
anchoring systems, as well as mooring or tethering systems, because
those requirements are addressed in Sec. 585.710.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing
paragraph (a), consistent with proposed Sec. 585.709. BSEE made minor
edits to the proposed changes to Sec. 285.709(a) by revising paragraph
(a)(13) to include ``tendon'' to be inclusive of all mooring system
types. BSEE is not finalizing proposed changes to paragraph (b) of this
section and is keeping the provision in the existing regulation.
BSEE responded to comments concerning CVAs in Section III, D.
above.
The provisions in this final rule do not change or purport to
change any other Federal agencies' regulatory requirements, including
the USCG's regulations governing integrity and stability of floating
facilities.
Sec. 285.710 When conducting onsite installation inspections, what
must the CVA or project engineer do?
Summary of proposed rule provisions: The Department proposed
requiring that the CVA ``verify'' the enumerated items to ensure
consistency with the ``verification'' standard for CVA activities. The
Department also proposed adding language in several locations requiring
the CVA to verify the commissioning of critical safety systems to be
consistent with Sec. 585.705. The Department proposed adding paragraph
(f) to clarify that the CVA must make periodic onsite inspections to
verify: (1) the systems and equipment function as designed; and (2) the
final commissioning records are complete during periodic onsite
inspections.
Summary of comments:
Comment: A commenter stated that the ``Background'' section of the
proposed rule should be revised to reflect the current expectations for
third-party witnessing of certain commissioning activities, as recently
issued in a COP Approval Letter Terms and Conditions.
Response: BSEE has included requirements in Sec. 285.710 for
commissioning activities that are similar to those found in the COP
terms and conditions. BSEE will also engage with the CVAs to ensure
expectations for commissioning are clear.
Comment: A commenter stated that attending and witnessing of
commissioning activities of safety and protection functions by the CVA
is not necessary as these functions are already type-certified as part
of the IECRE-OD501 process. The commenter instead provided several
regulatory text revisions to recommend that verification by a CVA be
limited to a review of completeness of commissioning records and
systems and remove the requirement of a review for type-certified
components.
Response: BSEE disagrees that witnessing the commissioning of
Critical Safety Systems and Equipment is not necessary. One of the
roles of the CVA is to certify that engineering procedures are executed
as designed. BSEE has determined that periodic witnessing of
commissioning operations, including Critical Safety Systems and
Equipment commissioning, in addition to reviewing completeness records
is necessary to ensure conformance with submitted plans, proper
functioning of all Critical Safety Systems and Equipment, and
completion of installation as designed.
Comment: A commenter requested that the Department clarify whether
some or all Critical Safety Systems and Equipment being referenced in
30 CFR 585.710 and the periodic inspection referenced in proposed 30
CFR 585.710(a) is applicable to all of the scope described by paragraph
(b).
Response: Critical Safety Systems and Equipment are identified on a
project basis through the risk assessment process. The inspection
program is designed to ensure that it is focused on critical areas and
needs of each project. All Critical Safety Systems and Equipment would
be included in the regulatory requirements.
Comment: A commenter requested clarification of the requirements
for the submission of as-builts. The commenter suggested that as-builts
should include as-fabricated drawings and documents of any facilities
outlined in a BOEM-approved SAP, COP, or GAP; a complete set of cable
drawing(s) and as-fabricated cable drawing(s) in the FIR; electrical
one-line drawing(s); cause-and-effect chart; and schematics of fire and
gas-detection system(s). The commenter provided additional suggestions
for the timeline of submission for these items and additional details
about what they should include.
Response: BSEE is declining to update the regulations regarding as-
builts in this final rule. BSEE may issue an NTL to clarify the as-
built requirements or update the regulations in the future should
additional requirements be necessary.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.710. Through this regulation, BSEE has clarified and
added requirements to ensure that the CVA or project engineer scope
includes verification and witnessing of the commissioning of the
Critical Safety Systems and Equipment. To achieve this, BSEE is
revising portions of paragraphs (a) through (g). Paragraph (a) requires
the CVA or project engineer to make periodic onsite inspections while
installation is in progress. Paragraph (b) enumerates a list of items
that the CVA or project engineer must verify. Specifically, paragraph
(b)(9) is added to address the commissioning of Critical Safety Systems
and Equipment. Paragraph (c) requires the CVA or project engineer to
verify that certain proper procedures were used for fixed or floating
facilities. Paragraph (d) requires that the CVA or project engineer
verify structural integrity, stability, and ballast, and that proper
procedures were used during certain stages of work for floating
facilities. The requirement that for ``a floating facility, the CVA or
project engineer must verify the structural integrity, stability, and
ballast'' was proposed in Sec. 285.709 but was also added to Sec.
285.710(d) because this verification work can only happen at the time
of installation.
BSEE made minor edits to proposed paragraphs (b)(6) and (d)(3) to
include ``tendon'' to be inclusive of all mooring system types.
Paragraph (e) requires the CVA or project engineer to conduct an
onsite inspection of the installed facility as
[[Page 42676]]
approved in the CVA scope of work. Paragraph (f) requires the CVA or
project engineer to make periodic onsite inspections to witness the
commissioning of Critical Safety Systems and Equipment in order to
verify that they function as designed and that the final commissioning
records are complete. Paragraph (g) requires the CVA or project
engineer to spot-check the equipment, procedures, and recordkeeping as
necessary to determine compliance with the applicable documents
incorporated by reference and the regulations under this part.
BSEE responded to comments concerning CVAs in Section III, D.
above. Additional comments and responses regarding this provision are
provided below.
Sec. 285.712 What are the CVA's or project engineer's reporting
requirements?
Summary of proposed rule provisions: The Department proposed adding
a requirement that the CVA report summarize any issues with facility
design, fabrication, or installation, or the commissioning of critical
safety systems to allow the Department to catalog a history of
successfully resolved issues and lessons learned, enabling the
Department to assess and facilitate the improvement and evolution of
the OCS renewable energy industry and the CVA program.
Summary of comments:
Comment: A commenter suggests formalizing the name of the Critical
Safety Systems Commissioning Records (CSSCR) throughout the Rule.
Response: BSEE did not create a new record called the CSSCR as this
reference is only used in Sec. Sec. 285.637, 285.710, and 285.714.
However, the Department does require the lessee to submit a risk
assessment that identifies the Critical Safety Systems and Equipment
(CSSE) and a description of the identified CSSE pursuant to Sec.
285.701(a)(12), commissioning procedures for CSSE pursuant to Sec.
285.702(a)(8), and a major modification or repair report if major
repairs or modifications to CSSE pursuant to Sec. 285.703. The CVA
must also verify the design, fabrication, installation, and
commissioning of CSSE pursuant to Sec. Sec. 285.705 and 285.707-
285.710 and must summarize any issues with the design and any incidents
during facility fabrication and installation, or CSSE commissioning,
and how those issues were resolved pursuant to Sec. 285.712. BSEE did
not revise the final rule based on this comment. There is additional
discussion regarding the subject of the comment in the NPRM.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.712, with one edit. BSEE is revising this regulation
to require that the CVA or project engineer prepare all reports and
records pursuant to this subpart. The CVA or project manager must
submit the interim version of the required reports or records to the
lessee and BSEE, as requested by BSEE. BSEE will have 30 days to review
the reports. The CVA or project engineer must submit the final version
of the required reports or records to BSEE. The CVA's or project
engineer's report or record must summarize any issues with the design
and any incidents during facility fabrication and installation, or
Critical Safety Systems and Equipment commissioning, and how those
issues were resolved.
BSEE moved the 30-day CVA report review from existing Sec. Sec.
285.637 and 285.708 to this section to decouple the concept of
reviewing CVA reports and the start of commercial operations.
BSEE responded to comments concerning CVAs in Section III, D.
above. Additional comments and responses regarding this provision are
provided below.
Sec. 285.713 [Reserved]
Summary of proposed rule provisions: The Department proposed moving
the requirement that a lessee must notify the Department within 10
business days of commencing commercial operations from Sec. 585.713 to
the proposed Sec. 585.637 to consolidate this provision with the other
requirements in Sec. 585.637 related to the commencement of commercial
operations. The Department proposed deleting the existing section
title, ``What must I do after the CVA or project engineer confirms
conformance with the Fabrication and Installation Report on my
commercial lease?,'' and reserving the section for future use.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE is removing and reserving
this section, consistent with the NPRM.
Sec. 285.714 What records relating to FDRs, FIRs, and Project
Modification and Repair Reports must I keep?
Summary of proposed rule provisions:
The Department proposed requiring that the records of the
commissioning of critical safety systems must be kept and made
available to the Department until BOEM releases the lessee from its
financial assurance. The proposed rule also suggested requiring the
lessee to provide the Department with the location of the records of
the commissioning of its critical safety systems.
The Department proposed a technical correction to this section to
clarify that the recordkeeping requirements apply to the design,
engineering, and modification and repair reports regulated in this
subpart. The Department proposed removing reference to recordkeeping
requirements for SAPs, COPs, and GAPs because they are addressed in the
existing and proposed Sec. 585.602.
The Department also proposed adding records of commissioning of
critical safety systems to the list of records to reflect changes
proposed elsewhere.
Summary of comments:
Comment: A commenter suggested adding a new section: ``What must I
include in my as-built submissions?''
[cir] ``(a) Your as-fabricated drawings and documents of any
facilities that are outlined in your FDR and FIR, must be made
available to DOI prior to PVR non-objection and must include the
following items:''
[ssquf] ``Required documents: (1) Complete set of cable drawing(s)
Description of required content: Complete set of as-fabricated cable
drawing(s).''
[ssquf] ``Required documents: (2) Electrical one-line drawing(s)
Description of required content: As-fabricated electrical one-line
drawing(s) for the facilities.''
Response: BSEE did not revise the final rule to address this
comment, but BSEE may publish an NTL to address expectations for as-
built submissions, as necessary, and BSEE may consider a regulatory
update in future rulemakings.
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.714. BSEE is revising
this regulation to require additional recordkeeping measures for the
commissioning of Critical Safety Systems and Equipment and the location
of records, as required in Sec. Sec. 285.701(c) and (d), 285.702(c)
and (d), 285.703(b), and 285.708(a)(5) and (7).
Sec. 285.803 How must I conduct my approved activities to protect
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?
Summary of proposed rule provisions: The Department proposed
amending the first sentence of paragraph (b) by replacing the word
``affects'' with the word ``effects.''
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The proposed change is not
applicable to
[[Page 42677]]
Sec. 285.803, so no changes have been made to this section in the
final rule. After certain renewable energy regulations were transferred
from BOEM to BSEE in the Reorganization Rule, BOEM retained the
language that was in Sec. 585.803 but moved it to Sec. 585.703.
BSEE's existing Sec. 285.803 states, ``You must comply with all
measures required under 30 CFR 585.703.''
Sec. 285.810 When must I submit a Safety Management System (SMS)
and what must I include in my SMS?
Summary of proposed rule provisions: The Department proposed
requiring a lessee to use an SMS for activities conducted on the OCS to
develop or operate a lease, from met buoy placement and site assessment
work through decommissioning, and to provide its SMS to the Department
upon request. The lessee would also be required to submit a detailed
description of the SMS with its COP (as provided under Sec.
585.627(d)), SAP (as provided in Sec. 585.614(b)), or GAP (as provided
in Sec. 585.651).
Summary of comments:
Comment: A commenter expressed concerns that the proposal could
reduce the frequency and intensity of regulatory oversight on safety
issues and requested that the Department share any information related
to requirements for Contingency Plans for potential catastrophic events
at OSW development sites.
Response: Regulatory oversight ensuring the safety of offshore
workers and responsible environmental stewardship of offshore wind
activities is a primary focus of BSEE and these SMS regulations reflect
this focus. Section Sec. 285.812(b) provides for ``regular
demonstration'' that the SMS is used and implemented effectively via
annual activity reports to BSEE and triannual reports summarizing the
lessees or grantees most recent SMS audit results, including corrective
actions, and an updated description of the lessees or grantees SMS
highlighting changes made since the last submission. With regard to
potential catastrophic events, BSEE requires the development and
functionality of Emergency Response Procedures in Sec. Sec. 285.810(c)
and 285.812.
Comment: Multiple commenters suggested that the Department clarify
that the SMS also apply to the safety of mariners, including fishermen,
within and near an OSW facility. Several commenters requested
clarifications on SMS scope, review, approval, certification standards,
definitions, submissions, and oversight roles.
Response: BSEE recognizes the importance of consistent safety
programs and risk mitigations and their potential impacts to the
fishing and recreation industries, and how they influence performance-
based regulatory programs. BSEE considers environmental safety to be
within the scope of an SMS. While the SMS regulations themselves do not
apply to mariners, including fishermen, the intent of the SMS
regulations are to ensure the safety of personnel or anyone near or on
the facilities.
Regarding comments seeking clarification on SMS generally, BSEE has
provided guidance to the industry related to these comments in Safety
Management System Expectations for Renewable Energy Companies Operating
on the OCS, which is posted on the BSEE website at https://www.bsee.gov/technical-presentations/ooc-presentation-sms-in-ocs-renewable-projects-may-13. This guidance includes information about
submissions, frameworks, and reviews.
Comment: Several commenters stated that the Department should
protect workers and worker's rights by requiring LPAs for operations
and maintenance workers as a condition of all renewable OSW leases and
ensure developer commitments to not discriminate or retaliate against
workers or contractors who raise health and safety concerns. One
commenter provided background information to show the importance of
improving workers' rights, stating that in the construction industry
alone, union worksites have 31% fewer health and safety violations. In
all industries, states with right-to-work laws (and consequently lower
union density) have a 14.2% higher rate of workplace deaths than states
without such laws. Without the Department's action, operations and
maintenance workers would have few protections at either the State or
Federal levels.
Response: While BOEM has jurisdiction over lease terms, BSEE agrees
that a positive safety culture includes the right to stop unsafe work
and that retaliation leads to a negative safety culture. To ensure the
safety of lessees and grantee personnel or anyone else on their
facilities, Sec. 285.810(a)(5) requires them to submit procedures as
part of the SMS for personnel or visitors to report unsafe work areas
or conditions to both the lessee, grantee or designated operator and
BSEE. BSEE will verify workers have a means of reporting unsafe working
conditions. BSEE also offers a means of reporting unsafe working
condition via the Safety and Incident Investigations Division (SIID)
Hotline: (877) 440-0173 or (202) 208-5646. Section 285.813(b)(1)
requires lessees to provide a written report to BSEE of any injury in
which a person is unable to return to work or perform their normal
duties the following day.
Comment: Several commenters provided editorial revisions to the
language in the proposed rule related to shut-downs, new language to
define the contents of as-built submissions, and details included in
SMS descriptions in plans. One such example revises certain language in
Sec. 585.810(b)(5) from ``shut-down of one or more facilities'' to
``manual shut-down of one or more facilities for the preservation of
safety.''
Response: BSEE agrees that all conditions might not be available
while the COP is still in the approval process and that it will change
over time as the program evolves. The objective of this requirement is
for lessees to demonstrate an awareness of conditions that could lead
to a shutdown of one of more facilities and what they have in place to
control or mitigate the risks.
BSEE supports the continued focus on performance-based approaches
to Safety Management Systems. BSEE is declining to update the
regulations regarding as-builts in this final rule. BSEE may issue an
NTL to clarify the as-built requirements or update the regulations in
the future should additional requirements be necessary. BSEE is
declining to change the language proposed limiting shutdown of
facilities to only manual shutdowns. Other types of shutdowns are
critical for safety and should be included in the SMS.
Comment: A commenter recommended replacing ``allision'' with
``collision'' at 585.810(c)(1). The commenter also recommended
replacing ``(e.g., ANSI Z10, ISO/IEC 45001)'' with ``(e.g., ANSI/ASSP
Z10, ISO 45001).'' The commenter stated that ``IEC 45001'' does not
exist and ``ANSI Z10'' is a shorthand expression that should be written
out.
Response: BSEE recognizes the difference between an ``allision''
and ``collision.'' BSEE revised the regulations to require reporting
for both collisions and allisions. BSEE also corrected the standard's
name with the official standard title.
Summary of final rule revisions:
The Department is finalizing this section, consistent with proposed
Sec. 585.810, with minor revisions. For added clarity, BSEE is
including items required in the SMS under paragraphs (a) through (f).
Additionally, BSEE is revising the language in paragraph (a)(1) to
clarify that the health and safety risk provisions in this paragraph
also apply to anyone ``engaged in lease activities.'' In paragraph
(a)(3), BSEE is clarifying that nationally or internationally
[[Page 42678]]
recognized standards are applicable to ensure the safety of the
activities covered by the SMS. BSEE is also making minor edits to this
section to apply the transfer of authority from BOEM to BSEE and make
corresponding corrections to regulation references.
BSEE responded to comments concerning SMS in Section III, H. above.
Additional comments and responses regarding this provision are provided
below.
Sec. 285.811 Am I required to obtain a certification of my SMS?
Summary of proposed rule provisions: The Department proposed adding
Sec. 585.811 stating that third-party SMS certification may be
obtained from accredited safety and environmental CABs. Such
certification would possibly benefit a lessee or a grant holder through
reduced frequency or scope of safety inspections and oversight of
corrective actions arising from lessee or grant holder self-
inspections. The Department could rely on such third-party
certifications for assurance of SMS compliance in lieu of direct
inspection. Additionally, the Department determined that a CAB's use of
a consensus safety standard--such as ANSI Z10 or ISO/IEC 45001--would
allow the incorporation of the most current safety approaches in a
rapidly evolving industry without the need for additional rulemaking.
Summary of comments:
Comment: Multiple commenters expressed support for the proposed
shift to a performance-based approach for SMS, particularly related to
incentives for obtaining certification or accreditation for SMS,
streamlined oversight, clearer safety expectations, coordination
enforcement through the Department, requirements for more detail to be
included in the SMS, and reporting requirements to allow comparisons of
safety industry-wide.
Response: BSEE supports the continued focus on a performance-based
approach to Safety Management Systems. BSEE is continually evaluating
improvements to the performance-based approach that have been
integrated into this rulemaking and they may also be considered in
future rules.
Comment: A commenter discussed a third-party SMS, including
accreditation and upcoming revisions to a standards document, Safety
and Environmental Management Systems (SEMS) API (American Petroleum
Institute) Recommended Practice (RP) 75 (4th ed.), and suggested that
the Department acknowledge this document and recognize the commenter's
program for accreditation as suitable for SMS certification. Some
changes the commenter recommended to the proposed rule include:
In Sec. 585.811, include API RP 75 in the parenthetical
examples of acceptable health and safety standards and modify the first
sentence such that it reads: ``You are not required to obtain a
certificate that your SMS meets acceptable health and safety standards
(e.g., API RP 75, ANSI Z10, ISO 45001) from a recognized accreditation
organization (e.g., COS, ANAB).'' In the corresponding preamble,
provide supporting information in the preamble for proposed Sec. Sec.
585.810 through 585.812 supporting API RP 75 as an acceptable health
and safety standard, and recognize COS's accreditation program for ASP
and COS's SEMS certificate program as suitable for lessees or grant
holders to receive incentives for their SMS.
Response: BSEE agrees that API RP 75 (4th ed.) is one acceptable
SMS framework standard and has included it as an example of an
acceptable standard in Sec. 285.811. This rulemaking does not specify
any recognized accreditation organization. BSEE has taken a
performance-based approach and declined to specify standard and
accreditation organizations at this point in time. The process
implemented here provides flexibility to both the lessee and BSEE.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.811. BSEE is revising this regulation to update the
transfer of authority from BOEM to BSEE in considering certifications
in determining the frequency and scope of SMS-related inspections under
this subpart, as well as the scope and nature of its oversight over any
audit-induced corrective actions. The final rule revises the list of
examples of acceptable health and safety standards to also include API
RP 75.
BSEE responded to comments concerning SMS in Section III, H. above.
Additional comments and responses regarding this provision are provided
below.
Sec. 285.812 How must I implement my SMS?
Summary of proposed rule provisions: The Department proposed
redesignating the existing regulatory text as paragraph (a) and
revising it to be consistent with the clarifications in proposed Sec.
585.810. The Department also proposed adding paragraph (b) to include
two reporting requirements. The first proposed report is an annual
summary of safety performance data that is due March 31 covering the
previous calendar year during which site assessment, construction,
operations, or decommissioning activities occurred. The second proposed
report is a summary of the most recent SMS audit, corrective actions
implemented or pending as a result of that audit, and an updated SMS
description highlighting changes made since the last report. This
report would be due every 3 years or upon request.
Summary of comments:
Comment: Some commenters asserted that the Department should
require an annual summary of safety performance data covering all site
assessment, construction, operations, or decommissioning activities;
and a report summarizing the results of the most recent SMS audit that
describes corrective actions and any SMS changes made.
Response: BSEE will require safety performance data be submitted to
BSEE according to Sec. 285.812(b)(1). BSEE intends to publish combined
data on its website on a regular basis.
Comment: Some commenters stated that while they welcome SMS
certification from accredited safety and environmental CABs, the
Department should not rely on such third-party certifications for
assurance of SMS compliance in lieu of direct inspection by the
Department. However, if the Department does permit self-inspection,
third-party SMS certification from safety and environmental CABs should
be required, and the third-party reports should be attested to, filed
with the agency, and accessible to the public on the agency's website.
Response: BSEE does not rely solely on third-party certifications
for assurance of SMS compliance, nor does it rely solely on self-
inspections for assurance of operational regulatory compliance. A
lessee SMS certification will be considered by BSEE during its
inspection data analysis, but it does not eliminate BSEE's ability to
conduct direct inspections. BSEE intends to publish combined data on
its website on a regular basis. BSEE is not requiring third-party SMS
certification, but third-party certification is encouraged. BSEE has
multiple ways to conduct safety oversight of projects, including self-
inspections, BSEE direct inspections, SMS third-party audits, BSEE led
SMS reviews, and remote inspections. BSEE has determined that utilizing
a performance-based approach to inspection frequency will be more
effective and allow for more comprehensive oversight. BSEE has
determined that the performance-based approach will allow for proactive
identification of hazardous conditions.
Summary of final rule revisions:
[[Page 42679]]
The Department is finalizing this regulation, consistent with
proposed Sec. 585.812. BSEE has moved this requirement from Sec.
585.811 to this section and has added paragraph (b), which includes the
reporting requirements that demonstrate your SMS is being implemented
effectively. BSEE is making minor edits to apply the transfer of
authority from BOEM to BSEE.
BSEE responded to comments concerning SMS in Section III, H. above.
Additional comments and responses regarding this provision are provided
below.
Sec. 285.815 What must I do if I have facility damage or an
equipment failure?
Summary of proposed rule provisions: The Department proposed
correcting an erroneous cross-reference in paragraph (a).
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.815. BSEE is revising
paragraph (a) of this regulation to require major repairs to be
reported to BSEE under Sec. 285.703. BSEE is making minor edits to
apply the transfer of authority from BOEM to BSEE.
Sec. 285.820 Will BSEE conduct inspections?
Summary of proposed rule provisions: The Department proposed
updating the regulations to clarify that the Department may inspect OCS
facilities and any vessels engaged in activities authorized under this
part. The Department proposed clarifying that during the inspections,
the Department would verify that activities are conducted in compliance
with OCSLA, conditions and stipulations of the lease or grant, approved
plans, and other applicable laws and regulations. The Department would
also determine whether proper safety equipment has been installed and
is operating properly according to the SMS.
Summary of comments:
Comment: Several commenters stated that more clarity is needed
regarding which vessels would be subject to Department inspections; the
roles of BOEM, BSEE, USCG, and independent inspection companies
contracted by lessees to conduct inspections; the intensity and focus
of inspections; and how inspections would address operational safety,
environmental risk, and engineering.
Response: BSEE-led inspections are limited to vessels conducting
lease activities in Federal waters that occur either on the lease or an
associated easement. Both BSEE-led inspections and self-inspections
will focus on ensuring that lease activities are being conducted in
compliance with the regulations, which are written to provide
protections to human safety and the environment. As described above,
BSEE's analysis of compliance, risk, and performance data will enable
it to tailor its scheduled and unscheduled inspections, including
utilization of remote inspections, remote testing, witnessing, and
review of self-inspection, allowing for comprehensive oversight.
Comment: Multiple commenters suggested that the Department should
consider remote condition monitoring using technology in conjunction
with targeted inspections to reduce the burden of yearly physical
inspections or should allow lessees to conduct less frequent
inspections coordinated with routine maintenance activities. Multiple
commenters provided revised text to include in the final rule
reflecting these changes. A commenter also suggested that the
Department should allow lessees to provide justification for a self-
inspection period greater than one year.
Response: OCSLA requires an annual onsite inspection of all safety
equipment designed to prevent or ameliorate fires, spillages, or other
major accidents. Accordingly, BSEE lacks authority to increase the time
between inspections beyond one year. BSEE supports the use of remote
condition monitoring by lessees to inform their productivity and
compliance efforts. BSEE's inspection program considers compliance,
risk, and performance-based data, which may be collected, and informed,
by remote monitoring technology, as well as the prescriptive annual
onsite inspection as required by the OCSLA.
Comment: A commenter stated that while the preamble language
discussing the proposed rules appears to indicate that the Department
would continue to conduct regular inspections, as written the proposed
rules do not require the Department to do so. The commenter recommended
that the Department's regulations provide some minimum frequency for
conducting onsite inspections to ensure adequate oversight of OCS
facilities.
Response: OCSLA requires an annual onsite inspection of all safety
equipment designed to prevent or ameliorate fires, spillages, or other
major accidents. Accordingly, BSEE lacks authority to increase the time
between inspections beyond one year. BSEE supports the use of remote
condition monitoring by lessees to inform their productivity and
compliance efforts. BSEE's inspection program considers compliance,
risk, and performance-based data, which may be collected, and informed,
by remote monitoring technology, as well as the prescriptive annual
onsite inspection as required by the OCSLA. The results of those and
other additional mandated inspections will be evaluated along with
lessee's performance record to determine the frequency of onsite
inspections by BSEE personnel. BSEE has determined that prescribing a
minimum frequency for BSEE inspections is not necessary at this time.
BSEE will use compliance, risk, and performance-based data to remain
adaptive as the renewable energy industry matures. . . .
Comment: A commenter expressed support for changing the phrase
``will inspect'' to ``may inspect'' in proposed Sec. 585.820. The
commenter remarked that this change would provide more flexibility to
the agency in allocating inspection resources while still retaining
full authority to inspect facilities and vessels engaged in OCS
renewable energy development.
Response: BSEE agrees with the commenter that changing ``will
inspect'' to ``may inspect'' provides more flexibility to the agency in
allocating inspection resources and revised Sec. 285.820 accordingly.
Comment: Commenters opposed the proposed language, which stated
that the Department ``may conduct'' an inspection. A commenter asserted
that if the Department is not largely responsible for inspections, the
agency would not be in a proactive position to address operational
safety issues. The commenter suggested that the Department improve
transparency in the inspection process by requiring more detailed
public reports and protection of worker's rights.
Response: BSEE will be involved in the inspection process,
including onsite inspections. BSEE determined that utilizing a
compliance, risk, and performance-based approach to onsite BSEE
personnel inspection frequency, remote inspections, remote testing
witnessing, and review of self-inspection will be more effective, allow
for more comprehensive oversite, and will allow for proactive
identification of hazardous conditions. Also, allowing self-inspection
to occur during maintenance visits reduces personnel exposure and
facility downtime.
BSEE currently releases performance statistics on the BSEE website
that track trends and provide incidents analysis and safety and health
performance-for oil and gas operations from performance data gathered
by BSEE, as required under 30 CFR 250.1929. BSEE plans to release
similar information for OSW
[[Page 42680]]
based on the performance data collected under Sec. 285.812. Section
285.812 requires that key safety and operational statistics are
captured by the lessees and reported to BSEE. BSEE uses this
information to calculate a variety of annual, OCS-wide, performance
indices and to track industry performance. These indices calculated by
BSEE allow lessees to benchmark their performance against aggregate
industry data, and for BSEE to provide the public with OCS performance
trends information.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.820, with minor revisions. BSEE is revising this
regulation to change the word ``will'' to ``may'' in the first sentence
to read ``BSEE may inspect OCS facilities and any vessels engaged in
activities authorized under this part.'' BSEE is also making minor
edits to this section to apply the transfer of authority from BOEM to
BSEE.
BSEE responded to comments concerning inspections in Section III,
I. above. Additional comments and responses regarding this provision
are provided below.
Sec. 285.821 Will BSEE conduct scheduled and unscheduled
inspections?
Summary of proposed rule provisions: The Department proposed
clarifying that it may conduct both scheduled and unscheduled
inspections.
Summary of comments: BSEE addressed comments relevant to this
provision in the ``Summary of comments'' for Sec. 285.820 immediately
above.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.821. BSEE is revising this regulation to change the
word ``will'' to ``may'' to read ``BSEE may conduct both scheduled and
unscheduled inspections.'' BSEE is also making minor edits to this
section to apply the transfer of authority from BOEM to BSEE.
BSEE responded to comments concerning inspections in Section III,
I.
Sec. 285.822 What must I do when BSEE conducts an inspection?
Summary of proposed rule provisions: The Department proposed a
technical correction to clarify that access for Departmental inspectors
must be provided to all facilities and vessels used for activities
authorized under this subpart. The Department also proposed requiring
that certain records be retained until BOEM releases the associated
financial assurance and that the lessee make these records available
upon request.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.822. BSEE is revising
paragraph (a)(1) to include the phrase ``and any vessels engaged in
activities authorized under this part'' after the word ``grant'' to
clarify the applicability of the regulations in this part to vessels.
BSEE is also making minor edits to this section to apply the transfer
of authority from BOEM to BSEE.
Sec. 285.824 How must I conduct self-inspections?
Summary of proposed rule provisions: The Department proposed
requiring that an onsite inspection of each of facility be conducted at
least once a year. The proposed revision allows the Department to have
flexibility in conducting the annual onsite inspection required under
the OCSLA. The Department suggested requiring that the inspection
include all safety equipment designed to prevent or ameliorate fires,
spillages, or other major accidents. The Department also proposed that
the lessee maintain records of the facility inspections, summarize the
results of those inspections, and provide the records and result
summaries upon request.
Summary of comments:
Comment: A commenter suggested that the Department provide more
information on the efficacy of self-inspections in relation to
operational safety. A commenter stated that the Department should
provide clarity on what should be included in a comprehensive self-
inspection plan. The commenter remarked that the scope of self-
inspections is expanded in the proposed rule to include ``all safety
equipment designed to prevent or ameliorate fires, spillages, or other
major accidents.'' However, this phrase is not illustrated or explained
in the preamble to the rule.
Response: BSEE has explained what must be included in self-
inspection plans in Sec. 285.824. BSEE is requiring that the self-
inspection plan development include performance-based evaluation and
identification of equipment designed to prevent or ameliorate fires,
spillages, or other major accidents. Requiring lessees to identify this
equipment, which is now defined as ``Critical Safety Systems and
Equipment'' in Sec. 285.112, allows for the regulatory requirements to
remain adaptive to new and emerging technologies BSEE is committed to a
compliance, risk, and performance-based inspection framework that is
tailored to the operation, developer, location, and associated risk.
Comment: Several commenters suggested that the Department provide
more clarity on the level and type of inspections needed (consider
allowing an independent inspection company to perform work on behalf of
a lessee), and the possibility of remote inspections to reduce
emissions and the overall exposure of industry and agency personnel
offshore.
Response: BSEE's inspection model is compliance, risk, and
performance-based, and includes the option of remote monitoring
technology, as well as the prescriptive annual onsite inspection
required by the OCSLA. As performance-based inspection by lessees and
operators using remote inspection technology is found to be successful
in reducing risks to industry personnel, BSEE may consider future
changes to inspection activities.
Summary of final rule revisions:
The Department is finalizing this regulation, consistent with
proposed Sec. 585.824, with minor revisions. BSEE is revising
paragraph (a)(1) to include ``tendon'' and ``tethering'' as components
of systems for floating facilities to be inclusive of all mooring
system types. BSEE is adding paragraph (a)(3) to clarify that your
self-inspection plan must specify how you will fulfill the requirement
for annual onsite inspection of all Critical Safety Systems and
Equipment. BSEE is revising paragraphs (b)(1) and (2) to clarify
inspection reporting and retention requirements. BSEE is also making
minor edits to this section to apply the transfer of authority from
BOEM to BSEE.
BSEE responded to comments concerning inspections in Section III,
I. above. Additional comments and responses regarding this provision
are provided below.
Sec. 285.830 What are my incident reporting requirements?
Summary of proposed rule provisions: The Department proposed
correcting an erroneous cross-reference in paragraph (d) to provide the
appropriate BSEE regulatory citation for reporting oil spills.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.830. BSEE is revising
paragraph (d) to include a citation to 30 CFR 250.187(d).
Sec. 285.900 Who must meet the decommissioning obligations in this
subpart?
[[Page 42681]]
Summary of proposed rule provisions: The Department proposed
subpart J requirements for decommissioning all facilities and
obstructions on a lease, RUE, or ROW issued under the Department's
renewable energy regulations. The Department proposed adding paragraph
(c) establishing a limited exception to its proposed subpart J
requirements for facilities that are approved by, and subject to the
decommissioning requirements of, another Federal authority. This
proposed amendment was intended to cover met buoys that would no longer
require an SAP under proposed Sec. 585.600. Such buoys would be
subject to the site clearance required by USACE and may be subject to
financial assurance requirements on a case-by-case basis, prior to
deployment, at the discretion of USACE. The Department proposed
exercising its authority to enforce the decommissioning requirements in
proposed subpart J and its enforcement options for noncompliance by
lessees in proposed subpart E.
Summary of comments:
Comment: A commenter suggested that BOEM work with BSEE to develop
enforcement procedures related to financial assurance in the event of a
default. The commenter said that BOEM and BSEE should ensure
performance of decommissioning obligations, maintain clear records of
ownership, and develop regulations that would require BSEE to enforce
decommissioning in reverse chronological order.
Response: The NPRM did not propose changes to enforcement actions
in the event of a default; therefore, changes to the final rule would
be outside of the scope of the rulemaking. BSEE may consider this
comment for future rulemakings.
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.900. BSEE is revising
this regulation to add paragraph (c) providing that if a lessee or
grantee has installed a facility on a lease or grant that was
authorized by an authority other than BOEM and that approving authority
has imposed a decommissioning obligation, such obligation will
substitute for the requirements of the subpart. The decommissioning
requirements in this subpart will apply to such a facility if the
authorizing agency has not imposed or enforced a decommissioning
obligation.
Sec. 285.902 What are the general requirements for decommissioning
for facilities authorized under my SAP, COP, or GAP?
Summary of proposed rule provisions: The Department proposed to
order decommissioning of facilities earlier than two years following
lease termination if the facilities are no longer useful for
operations. The Department solicited comments on the meaning of the
term ``no longer useful for operations'' and whether this was the best
or most appropriate standard for the Department to use to describe
facilities that should be required to be decommissioned.
Summary of comments:
Comment: Three commenters stated that the decommissioning process
is unclear.
Response: BSEE disagrees that these requirements are unclear.
BSEE's regulations at 30 CFR part 285, subpart I, require that, within
two years following termination of a lease or grant, the owner must
decommission all facilities, projects, cables, pipelines, and
obstructions on their lease. Section 285.906 specifies what the
decommissioning application must include.
Comment: A commenter requested additional information on the
potential impacts of the change to tailored financial assurance amounts
and instruments, specifically, regarding requirements to fund
decommissioning and who is legally responsible for decommissioning.
Response: The requirements on providing financial assurance are
defined in 30 CFR part 585. The lessee(s) are legally responsible for
decommissioning as defined in 30 CFR part 285, subpart I.
Comment: A commenter recommended the addition of language regarding
the mechanism for financial assurance for decommissioning if USACE does
not require site clearance ahead of site assessment activities.
Response: BSEE's regulations require that the buoy be
decommissioned if the USACE does not require a decommissioning
obligation. BSEE strengthened Sec. 285.900(c) to say, ``The
decommissioning requirements in this subpart will apply to such a
facility if the authorizing agency has not imposed or enforced a
decommissioning obligation.'' BSEE expects to utilize its regulatory
authority for decommissioning of buoys in limited circumstances.
Summary of final rule revisions: The Department is finalizing this
regulation, consistent with proposed Sec. 585.902. BSEE is revising
paragraph (a) to include the phrase ``or earlier if BSEE determines a
facility is no longer useful for operations'' after ``grant,'' and
before ``, you must.'' In addition, BSEE is making minor edits to this
section to apply the transfer of authority from BOEM to BSEE.
Sec. 285.905 When must I submit my decommissioning application?
Summary of proposed rule provisions: The Department proposed adding
paragraph (e) to address the timing of applications pursuant to the
proposed ``idle iron'' authority under Sec. 585.902.
Summary of comments: BSEE did not receive any comments regarding
this section.
Summary of final rule revisions: BSEE is revising this section by
adding paragraph (e), which specifies that a lessee must submit a
decommissioning application 90 calendar days after BSEE determines a
facility is no longer useful for operations. BSEE is also making minor
edits to this section to apply the transfer of authority from BOEM to
BSEE.
B. 30 CFR Part 585
Subpart A--General Provisions
Sec. 585.100 Authority.
The text of this section is unchanged from the version that was
adopted in the Reorganization Rule, which states, ``The authority for
this part derives from section 8 of the Outer Continental Shelf Lands
Act (OCSLA) (43 U.S.C. 1337). The Secretary of the Interior delegated
to the Bureau of Ocean Energy Management (BOEM) the authority to manage
the development of energy on the Outer Continental Shelf (OCS) from
sources other than oil and gas, including renewable energy, through the
issuance of leases, easements, and right-of-way for activities that
produce or support the production, transportation, or transmission of
energy.''
Please refer to the Other Proposed Changes in Part 585 and
Potential Revisions to Regulations Governing Transmission sections of
Section III above for a discussion of the public comments related to
this section and BOEM's responses to those comments.
Sec. 585.101 What is the purpose of this part?
The language of this section is the same as what has been
previously finalized as part of the Reorganization Rule, with the
exception of minor grammatical edits. The Reorganization Rule removed
references to Alternate Use RUEs. The Alternate Use RUEs are now
addressed in 30 CFR part 586 of the regulations because they are not
intended to be used solely for renewable energy and related projects.
Consistent with the Reorganization Rule, the language of the final rule
states that the purpose of part 585 is to: (a) Establish procedures for
issuance and
[[Page 42682]]
administration of leases, right-of-way (ROW) grants, and right-of-use
and easement (RUE) grants for renewable energy production on the OCS;
(b) Inform relevant parties of their obligations when they undertake
activities authorized in this part; and (c) Ensure that renewable
energy activities on the OCS are conducted in a safe and
environmentally sound manner, in conformance with the requirements of
subsection 8(p) of OCSLA, other applicable laws and regulations, and
the terms of the lease, ROW grant, or RUE grant.
Paragraph (d) of this section, which provides that this part will
not convey access rights for oil, gas, or other minerals, is unchanged.
No substantive comments were received on this section of the rule.
Sec. 585.102 What are BOEM's responsibilities under this part?
Section 585.102(a) specifies that BOEM will authorize renewable
energy activities in accordance with OCSLA subsection 8(p)(4), as
implemented in Sec. 585.102(a)(1) through (12). In the final rule,
BOEM is amending this regulation to clarify that none of the enumerated
requirements is intended to outweigh or supplant any other and that
BOEM needs to reach a rational balance among the factors, as determined
by the Secretary. The final rule clarifies that no one factor or
consideration, by itself, should outweigh the other relevant
considerations to the extent they conflict or are otherwise in tension.
The final rule also provides that BOEM's responsibility to prevent
waste on the OCS also includes the obligation to prevent economic waste
and physical waste of energy resources from sources other than oil and
gas. Some of the aforementioned changes were made in response to
comments, as discussed further in section K.3 above. The Reorganization
Rule added ``and approved plans'' to paragraph (b) to clarify that BOEM
will require compliance with approved plans as well as all applicable
laws, regulations, other requirements, and the terms of the lease.
Please refer to the Other Proposed Changes in Part 585 section of
Section III above for a discussion of the public comments related to
this section and BOEM's responses to those comments, as well as the
revisions made to the proposed rule language in this final rule.
Sec. 585.103 When may BOEM prescribe or approve departures from
these regulations?
Section 585.103 was first promulgated to allow BOEM to maintain
programmatic flexibility while adapting to a new and changing industry
by approving departures from regulatory requirements under certain
limited circumstances.\18\
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\18\ See supra note 51, at 19653.
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This final rule adopts the proposed revisions to Sec. 585.103(a)
introductory text and (a)(1) to specify that BOEM may prescribe or
approve a departure from the regulations when BOEM deems the departure
necessary because the applicable provisions as applied to a specific
circumstance are impractical or unduly burdensome and the departure is
necessary to achieve the intended objectives of the renewable energy
program. In this way, BOEM will maintain flexibility to adapt the
regulations to the unique circumstances of this new and evolving
industry while retaining the consistency and integrity of the
regulations as a whole.
The departure provisions of the existing section were limited in
scope to those regulatory provisions that apply to existing leases and
grants. However, BOEM has applied departures not only to activities
``on a lease or grant,'' but also to activities that occur before lease
issuance (e.g., BOEM's planning and lease sale processes) and after
lease termination (e.g., decommissioning, release of financial
assurance). These changes would allow for such departures.
Minor updates to the provisions of paragraphs (a)(2) through (4)
were made for consistency with the revisions to paragraph (a). No
changes are proposed to Sec. 585.103(b) that provides that an approved
departure and its rationale must be consistent with subsection 8(p) of
OCSLA, protect the environment and public health and safety, not impair
the rights of third parties, and be documented in writing.
Please refer to the Other Proposed Changes in Part 585 section of
Section III above for a discussion of the public comments related to
this section and BOEM's responses to those comments, as well as the
revisions made to the proposed rule language in this final rule.
Sec. 585.104 Do I need a BOEM lease or other authorization to
produce or support the production of electricity or other energy
product from a renewable energy resource on the OCS?
Section 585.104 traces the statutory language of OCSLA in
establishing that a lease, ROW, or RUE issued under this part is
required in order to construct, operate, or maintain facilities that
``produce or support production, transportation, or transmission of
energy from sources other than oil and gas.'' \19\ This final rule does
not adopt the language from the proposed rule stating that, ``for
purposes of this section, site assessment activities are not considered
to produce, transport, or support the generation of any energy
products; and, therefore, such activities do not, by themselves,
require a lease, easement or ROW.'' (88 FR 5992) That language implied
that such activities would not be covered under BOEM's authority under
OCSLA. While it is true that in this rule, BOEM has excluded buoys from
the description of activities for which an approved SAP would be
required, it would be an overstatement to say that such activities do
not support the generation of energy. This revision is intended to
clarify that an entity does not require a lease from BOEM to deploy a
met buoy or tower for site assessment activities that are not located
on an existing commercial lease. Under this final rule, BOEM will not
require a separate lease for the deployment of simple buoys.\20\ The
USACE may be the lead Federal permitting agency for such facilities
under its existing legal authority, though other agencies may also have
permitting or consultation requirements, such as NOAA (National Oceanic
and Atmospheric Administration) under the National Marine Sanctuaries
Act (NMSA). For instance, a permit may be required for proposed off-
lease site assessment activities that would occur within a national
marine sanctuary. Additionally, under section 304(d) of the NMSA,
Federal agencies must consult with NOAA before approving off-lease site
assessment activities that are likely to destroy, cause the loss of, or
injure any sanctuary resource.
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\19\ 43 U.S.C. 1337(p)(1)(C).
\20\ BOEM would nonetheless require a commercial lessee seeking
to install an on-lease met tower to submit an SAP in addition to the
USACE permit, given the potential impacts that might be caused by
such towers.
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Please refer to the Site Assessment Facilities section of Section
III above for a discussion of the public comments related to this
section and BOEM's responses to those comments, as well as the
revisions made to the proposed rule language in this final rule.
Sec. 585.105 What are my responsibilities under this part?
In the final rule, BOEM adopted a minor modification proposed in
the NPRM to strengthen the requirement for lessees to comply with all
applicable laws, regulations, other requirements, the terms of the
lease or grant under this part, reports, notices, approved plans, and
any conditions imposed by BOEM. This would expand, strengthen, and
clarify the language found in existing Sec. 585.105(d), requiring
compliance only with the ``terms, conditions, and
[[Page 42683]]
provisions of all reports and notices submitted to BOEM, and of all
plans, revisions, and other BOEM approvals, as provided in this part.''
The revised language requires that lessees and operators comply with
all applicable laws and regulations, the terms of the lease or grant
under this part; reports, notices, and approved plans prepared under
this part; and any conditions imposed by BOEM through its review of any
of these reports, notices, and approved plans, as provided in this
part.
Please refer to the Sec. 285.701 of this section for a discussion
of the public comments related to this section and BSEE's responses to
those comments. No changes were made in response to the comments.
Sec. 585.106 What happens if I fail to comply with this part?
The previous Sec. 585.400 was moved to Sec. 585.106 by the
Reorganization Rule. This section provides that BOEM may take
appropriate corrective action under this part if a lessee or operator
fails to comply with applicable provisions of Federal law, the
regulations in this part, other applicable regulations, any order of
the Director, the provisions of a lease or grant issued under this
part, or the requirements of an approved plan or other approval under
this part.
It further specifies that BOEM may issue a notice of noncompliance
if it determines that there has been a violation of the regulations in
this part, any order of the Director, or any provision of a lease,
grant, or other approval issued under this part. When issuing a notice
of noncompliance, BOEM will serve the offending party at its last known
address.
When issuing a notice of noncompliance, BOEM will inform the
offending party how it failed to comply with this part, any order of
the Director and/or the provisions of the lease, grant, or other
approval, and will specify what must be done to correct the
noncompliance and the time limits within which action must be taken.
The failure of a lessee, operator, or grantee to take the actions
specified in a notice of noncompliance issued under this part within
the time limit specified provides the basis for issuance of a cessation
order by BSEE, as provided in 30 CFR 285.401 and/or cancellation of the
lease or grant by the Secretary as provided in Sec. 585.422.
The final rule updates this section, as proposed, to clarify that
BOEM may assess civil penalties, as authorized by section 24 of the
OCSLA and as determined under the procedures set forth in 30 CFR part
550, subpart N, if a company fails to comply with any provision of this
part or any term of a lease, grant, or order issued under the authority
of this part after notice of such failure and expiration of any
reasonable period allowed for corrective action.
Consistent with the Modernization Rule NPRM, the final rule now
provides that civil penalties will be determined and assessed in
accordance with the procedures set forth in 30 CFR part 550, subpart N,
after notice of such failure and expiration of any reasonable period
allowed for corrective action or if BOEM determines the failure
constitutes, or constituted, a threat of serious, irreparable, or
immediate harm or damage to life (including fish and other aquatic
life), property, or the marine, coastal, or human environment. BOEM
made minor revisions to this provision to ensure consistency with
OCSLA.
Please refer to the Lease Issuance Procedure and Other Proposed
Changes in Part 585 sections of Section III above for a discussion of
the public comments related to this section and BOEM's responses to
those comments, as well as the revisions made to the proposed rule
language in this final rule.
Sec. 585.107 Who can acquire or hold a lease or grant under this
part?
BOEM is implementing several changes to its qualification
requirements, as proposed and as a result of the Reorganization rule
(88 FR 6376).
First, this final rule replaces the word ``hold'' with ``acquire or
hold'' throughout this section to clarify that the qualification
requirements of Sec. 585.107 are intended to apply both to the
acquisition and retention of both OCS lease and grant interests. BOEM
does not require automatic forfeiture of a party's existing lease and
grant interests if the lessee or grantee no longer meets the criteria
in this section; rather, the provisions at Sec. 585.422 would be the
appropriate vehicle for canceling a lease in these circumstances.
Second, this final rule makes a grammatical correction to paragraph
(a)(6) to list the citizenship qualifications in the disjunctive and
not the conjunctive by removing ``and'' and replacing it with ``or''.
Third, this final rule adds criteria that may disqualify a party
from acquiring a lease or grant interest under this part and,
consequently, from participation in the lease and grant issuance
processes. This final rule will prevent a party that has been
disqualified from acquiring a lease or grant interest (because it
either lacks the basic regulatory qualifications or has engaged in
certain enumerated misconduct) from participating in any lease or grant
issuance processes under this part. This provision closes a loophole in
paragraph (c) by prohibiting a party disqualified from acquiring a
lease or grant interest from entering into commercial agreements to
participate in the lease or grant issuance processes on behalf of a
third party. BOEM also revised paragraph (c) to clarify BOEM's
authority to disqualify a party from participating in an auction, which
is not explicitly set forth in the existing regulations. These
provisions are intended primarily to deter current and potential
lessees and grantees from engaging in conduct that is illegal or
detrimental to BOEM's renewable energy program and to the fair conduct
of its auctions.
A party under consideration for disqualification will receive
written notice from BOEM of the basis for the disqualification and will
be provided an opportunity to be heard before BOEM issues a final,
appealable decision. BOEM also may instruct that party regarding what
remedial actions, if any, would restore its qualification. Until such
remedial actions are completed to BOEM's satisfaction or until
qualification is otherwise restored, a disqualified party would be
ineligible to acquire a lease or grant under this part or to otherwise
participate in BOEM's competitive and noncompetitive lease or grant
issuance processes.
BOEM also added paragraph (d) to this section to provide that a
lease may be held by one or more persons provided that all interest
holders are eligible to hold a lease pursuant to this section and Sec.
585.108. BOEM made this addition to support the revisions to the lease
structure, assignment and segregation provisions included in the NPRM
and final rule. These final rule provisions were proposed and finalized
in support of BOEM's goal of providing lessees with more flexibility
throughout the lease development process.
Please refer to the Lease Issuance Procedure section of Section III
above for a discussion of the public comments related to this section
and BOEM's responses to those comments.
Sec. 585.108 How do I show that I am qualified to be a lessee or
grant holder?
BOEM is implementing a technical correction to paragraph (b), as
specified in the Reorganization rule (88 FR 6376), to reflect that the
Immigration and Naturalization Service no longer exists and to avoid
the need for future technical corrections in the event of another
change in the name of the relevant Federal immigration authority.
No comments were received on this section of the rule.
Sec. 585.109 When must I notify BOEM if an action has been filed
alleging that I am insolvent or bankrupt?
[[Page 42684]]
This section is unchanged from the existing regulation, except for
being renumbered.
No comments were received on this section of the rule.
Sec. 585.110 When must I notify BOEM of mergers, name changes, or
changes of business form?
This section is unchanged from the existing regulations, except for
being renumbered. No comments were received on this section of the
rule.
Sec. 585.111 How do I submit plans, applications, reports, or
notices required by this part?
In the final rule, BOEM adopted the proposed changes to this
section to eliminate its paper copy requirement and henceforth to rely
primarily on electronic submissions. The paper requirement has proven
unwieldy for voluminous plan submittals that contain multiple
appendices and may be subject to multiple revisions before they are
finalized.
BOEM reserves the authority to require paper copies of certain
documents (such as maps and charts), if necessary.\21\ This final rule
also eliminates specific BOEM mailing addresses to avoid the need for
future technical corrections if BOEM's mailing address were to change
again. Instead, the mailing addresses for submissions will be listed on
BOEM's website. No comments were received on this section of the rule.
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\21\ BOEM proposes to retain the paper copy requirement for
assignment applications given the importance of having an original
signed version. See discussion infra VI.E Sec. 585.408.
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Sec. 585.112 When and how does BOEM charge me processing fees on a
case-by-case basis?
Under this final rule, BOEM will charge a processing fee on a case-
by-case basis under the procedures in this section with regard to any
application or request under this part if it decides at any time that
the preparation of a particular document or study is necessary for the
application or request and it will have a unique processing cost, such
as the preparation of an environmental assessment (EA) or EIS. The rule
specifies that processing costs will include contract oversight and
efforts to review and approve documents prepared by contractors,
whether the contractor is paid directly by the applicant or through
BOEM, applying a standard overhead rate to direct processing costs.
BOEM may assess the ongoing processing fee for each individual
application or request under the following circumstances: before
processing any application or request, BOEM will provide a written
estimate of the proposed fee based on reasonable processing costs. BOEM
will allow comment on the proposed fee; lessee and operators may then
ask for BOEM's approval to create, or to directly pay a contractor to
create, all or part of any document, study, or other activity according
to standards we specify, thereby reducing our costs for processing an
application or request; or ask to pay us to perform, or contract for,
all or part of any document, study, or other activity.
BOEM will provide the final estimate of the processing fee amount
with payment terms and instructions after considering the lessee's
comments and any BOEM-approved work that will be done. If BOEM
encounters higher or lower processing costs than anticipated, we will
re-estimate our reasonable processing costs. Once processing is
complete, BOEM will refund the amount of money that was not spent on
processing costs.
Lessees and operators must pay the entire fee before BOEM will
issue the final document or take final action on an application or
request, subject to the appeal rights specified in accordance with the
regulations in 43 CFR part 4. BOEM will not process the document
further until the appeal is resolved unless the fee is paid under
protest while the appeal is pending. If the appeal results in a
decision changing the proposed fee, we will adjust the fee in
accordance with paragraph (b)(5) of this section, which BOEM has
consolidated into one paragraph in the final rule instead of it being
divided by paragraphs (b)(5)(i) and (ii). If BOEM adjusts the fee
downward, it will not pay interest. Otherwise, this section is as
proposed and is unchanged from the existing regulations. No comments
were received on this section of the rule.
Sec. 585.113 Definitions.
This final rule modifies the definitions for the following terms,
in accordance with the proposals outlined in the NPRM, or to match the
definition changes that have already been adopted in connection with
the final Reorganization Rule: ``affected local government,''
``affected State,'' ``best management practices,'' ``multiple factor
auction,'' and ``we.''
This final rule, as proposed, adds a definition for ``bidding
credits.'' Bidding credits are defined as the value assigned by BOEM,
expressed in monetary terms, to the factors or actions demonstrated, or
committed to, by a bidder at a BOEM lease auction during the
competitive lease award process. The regulations further specify that
the types and values of any bidding credits awarded to any given bidder
will be set forth in the FSN.
This final rule adds a new definition for ``coastal environment''
to mean ``the physical atmospheric, and biological components,
conditions, and factors which interactively determine the productivity,
state, condition, and quality of the terrestrial ecosystem from the
shoreline inward to the boundaries of the coastal zone.'' The term
``coastal environment'' is used in the existing regulations and its use
is continued in these revised regulations in provisions that refer to
the marine, coastal, and human environments. However, the term is not
defined in the existing regulations even though the ``marine
environment'' and the ``human environment'' are defined in them. All
three terms are defined in the OCS Lands Act itself, and so we have
included the statutory definition for ``coastal environment'' in these
regulations. This should not add any burden to lessees since the
statutory definition has been the reference point for its meaning in
the absence of a definition in the regulations. Adding the definition
simply clarifies that point.
This final rule modifies the definition of ``commercial
activities'' to state that such activities are conducted ``under''
leases and grants rather than ``for'' them. This clarifies that
commercial activities as defined in the rule apply only to on-lease or
on-grant activities, and not off-lease or off-grant activities by
commercial lessees and grantees.
This final rule revises the definition for ``Critical Safety
Systems and Equipment'' to mean safety systems and equipment designed
to prevent or ameliorate fire, spillages, or other major accidents that
could result in harm to health, safety, or the environment in the area
of your facilities. This modification was made to be consistent with
BSEEs' definition of the same term in Sec. 285.112.
The final rule does not include the proposed addition of the term
``engineered foundation'' and its definition ``any structure installed
on the seabed using a fixed-bottom foundation constructed according to
a professional engineering design (based on an assessment of
sedimentary, meteorological, or oceanographic conditions).'' The
proposed definition in the NPRM was only meant to apply to the SAP
provisions of the regulations and the addition of a general definition
of ``engineered foundations'' had the potential to cause confusion
throughout the other provisions. Furthermore, the in-text revisions to
the SAP regulations include the substance of this definition, which
makes its inclusion under Sec. 585.113 duplicative and unnecessary.
[[Page 42685]]
This final rule also revises the definition for the term
``fabrication'' proposed in the NPRM, which is defined in this final
rule to mean ``the cutting, fitting, welding, or other assembly of
project elements.'' The modification was made to be consistent with the
definition provided in BSEE's regulations in Sec. 285.112.
This final rule revises the definition of ``geographic center of a
project'' to address the ambiguity by removing references to ``mapping
system'' and ``system''.
This final rule adds definitions for the terms ``lease area'' and
``provisional winner'' to provide clarity in the regulatory text.
``Lease area'' means ``an OCS area identified by BOEM for potential
development of renewable energy resources''. The ``provisional winner''
means the bidder that BOEM determines at the conclusion of the auction
to have submitted the highest bid. The provisional winner would become
the winning bidder upon favorable completion of the government's post-
auction reviews.
This final rule adds a new definition of ``multiple factor
auction,'' which is defined to mean an auction that involves the use of
bidding credits to incentivize goals or actions that support public
policy objectives or maximize public benefits through the competitive
leasing auction process. In all multiple factor auctions, BOEM would
add the monetary value of the bidding credits to the value of the cash
bid to determine the highest bidder.
This final rule amends the definition of ``Outer Continental Shelf
(OCS)'' to incorporate the amendment to that term by the IRA, which
expanded the OCS to include lands within the exclusive economic zone of
the U.S. and adjacent to any territory of the U.S, except any area
conveyed by Congress to a territorial government for administration.
(IRA Sec. 50251(b)(1)).
The final rule includes several revisions to the definition of
``project easement.'' The revised definition states ``project
easement'' means an easement to which, upon approval of your
Construction and Operations Plan (COP) or General Activities Plan
(GAP), you are entitled as part of the lease for the purpose of
installing, maintaining, repairing and replacing: gathering,
transmission, and distribution, and inter-array cables; power and
pumping stations; facility anchors; pipelines; and associated
facilities and other appurtenances on the OCS as necessary for the full
enjoyment of the lease. The addition of ``maintaining, repairing and
replacing''; and ``inter-array'', ``power and pumping stations'', and
``facility anchors'' all support the implementation of BOEM's proposed
changes to Sec. 585.628(g)(1), which allow BOEM to approve project
easements of ``sufficient off-lease area to accommodate potential
changes at the design and installation phases of the project for
locating cables, pipelines, and other appurtenances necessary for your
project.'' BOEM received comments in support of these changes.
This rule also finalizes the new definition of ``receipt'' of a
document, as proposed in the NPRM, which is deemed to have taken place,
in the absence of documentation to the contrary, (a) 5 business days
after the document was given to a mail or delivery service with the
proper address and postage; or (b) on the date the document was sent
electronically. This definition borrows from the Interior Board of Land
Appeals (IBLA) regulation on service of documents at 43 CFR 4.401(c)(7)
but acknowledges that most documents will be transmitted
instantaneously through electronic means. In the absence of
documentation evincing actual receipt, the presumption of constructive
receipt in this definition would be overcome by evidence demonstrating
that a document was either not received or received in more or less
time than the default timeframes set forth. The definition of
``receipt'' would apply to variants of that word, including variants of
``receive,'' and would apply only where those terms are used in the
regulations to describe the receipt of a document when the timing of
receipt triggers a regulatory time period or consequence.
BOEM is revising the definition of ``site assessment activities''
to distinguish site assessment activities from site characterization
activities.
The final rule adds a definition ``you and your'' to explain the
terms.as specified in the Reorganization rule (88 FR 6376).
Sec. 585.114 How will data and information obtained by BOEM under
this part be disclosed to the public?
BOEM is implementing a technical change in this section,
substituting the word ``commencement'' for ``initiation'' in paragraph
(b)(1) for consistency with the remainder of BOEM's offshore renewable
regulations.
No comments were received on this section of the rule.
Sec. 585.115 Paperwork Reduction Act statements--information
collection.
The final rule updates the table in this section to align with
proposed paragraph (e) of Sec. 585.115 in the NPRM. This final rule
reorders the subparts in the table to reflect the updated listing of
subparts in the NPRM as a result of the addition of a new subpart B,
and to remove from the list subparts H through J, authority for which
has been transferred to BSEE, and subpart K, the contents of which have
been included in new part 586.
No substantive comments were received on this section of the rule.
Sec. 585.116 Requests for information.
The existing regulations reference two public information requests
that share the same acronym: requests for interest (RFI) under
Sec. Sec. 585.210 and 585.231, and requests for information (RFI)
under Sec. 585.116. This final rule combines all such notices in
revised Sec. 585.116 and refers to them as requests for information.
The request for interest is an optional step in the leasing process
that assists BOEM in collecting information in advance of initiating a
new leasing process. BOEM used the request for interest in this way
several times, especially early in the program. However, more recently,
the practice has been to initiate the leasing process with the first
mandatory step in the leasing process, publishing a Call. This final
rule has eliminated the request for interest as a step in the leasing
process. In the event that BOEM would like to start the leasing process
with a solicitation of information from the public, the more general
request for information under Sec. 585.116 will be available to serve
that need. No substantive comments were received on this section of the
rule.
Sec. 585.117 Severability.
BOEM's existing regulations do not contain a severability provision
nor did BOEM propose one in the NPRM. However, in this final rule BOEM
has included a severability provision in new Sec. 585.117 as follows:
``If a court holds any provisions of this part or their applicability
to any persons or circumstances invalid, the remainder of the
provisions and their applicability to any persons or circumstances will
not be affected.'' While BOEM has determined that all of these sections
can and do function separately, BOEM understands that a court will
ultimately determine whether portions of the rule can be severed from
others. In the event a court determines a provision was improperly
promulgated, this section is designed to aid that review by
demonstrating that BOEM intends the various components of this final
rule, with various provenances and independent functions, to continue
to operate even if one or more of the provisions is declared unlawful.
Sec. 585.118 What are my appeal rights?
The final rule adopts the proposed revisions to this section in the
NPRM.
[[Page 42686]]
BOEM's existing renewable energy regulations discussed appeal rights in
two sections--Sec. Sec. 585.118 and 585.225. Section 585.118 described
the right to appeal BOEM final decisions made under part 585 to the
IBLA, whereas Sec. 585.225 provided that a bidder may request the
Director to reconsider its bid rejection but cannot appeal that
decision to the IBLA. To simplify and clarify the administrative review
provisions, this final rule has combined these two sections by locating
all procedures for review of BOEM renewable energy final decisions or
orders in revised Sec. 585.118. This revised section maintains the
distinction between requesting reconsideration of rejected bids and
appeals of other final decisions made under part 585, but now
characterizes challenges to decisions selecting provisional winners as
appeals to the Director, rather than requests for reconsideration.
This section provides appeal rights to any adversely affected
bidder of a provisional winner selection decision. Previously, Sec.
585.225(b) limited requests for reconsideration to those with rejected
bids. The revised Sec. 585.118 will also provide provisional winners
an opportunity to appeal if they believe there have been any errors or
omissions in the selection decision, such as miscalculated or unapplied
bidding credits.
This section specifies that BOEM must receive written appeals of a
decision selecting the provisional winner within 15 business days after
a bidder receives notice of the decision. This is consistent with the
existing regulations at Sec. 585.225(b) and clarifies the language of
the existing Sec. 585.118(c)(1). This section adopts the rules found
in the appeal procedures at 30 CFR 590.3 of this chapter for
determining when a selection decision is received.
Finally, this revised section clarifies two points regarding an
appeal of a decision selecting the provisional winner. First, the
provisional winner will have an opportunity to be heard before the BOEM
Director reverses a selection decision. Second, the Director's decision
will no longer be appealable administratively to the IBLA. No comments
were received on this section of the rule.
Sec. Sec. 585.119-585.149 [Reserved]
C. 30 CFR Part 585, Subpart B--The Renewable Energy Leasing Schedule
Sec. 585.150 What is the Renewable Energy Leasing Schedule?
BOEM has added a new subpart and section to the regulations, as
proposed, that define a proposed leasing schedule for the renewable
energy program. BOEM has determined that a new subpart is appropriate
given the nature of this change and the potentially significant benefit
to stakeholders. This schedule would include a list of locations under
consideration for leasing and a schedule that BOEM would follow in
holding its future renewable energy lease sales. According to this
subpart, at least once every two years, the Secretary will publish this
schedule of proposed lease sales. The first published schedule would be
issued for the five-year period following the effective date of this
rulemaking and subsequent schedules will cover the five-year period
after the update. This schedule will include a general description of
the area of each proposed lease sale, the calendar year in which each
lease sale will occur, and the reasons for any changes made to the
previous schedule. Any proposed leasing schedule or event would
continue to be subject to all applicable regulations, including area
identification, coordination with relevant parties, and applicable
environmental reviews.
BOEM seeks to improve transparency regarding the government's
intentions for future offshore wind leasing without proliferating
requirements for BOEM, industry or the public. It is a commitment for
the agency to openly communicate in good faith approximately where and
when it plans to shift its gaze for area identification and leasing. It
does not bind the agency to engage in specific additional public
engagement or process to inform the schedule and allows flexibility to
modify a schedule after publication.
Please refer to the Renewable Energy Leasing Schedule section of
Section III above for a discussion of the public comments related to
this section and BOEM's responses to those comments.
Sec. Sec. 585.151-585.199 [Reserved]
D. 30 CFR Part 585, Subpart C--Issuance of OCS Renewable Energy Leases
General Lease Information
Subpart B, Issuance of OCS Renewable Energy Leases, is being
redesignated as subpart C to accommodate the addition of a new subpart
B, as noted above. The individual section numbers in subpart C and in
subsequent subparts have not been changed.
Sec. 585.200 What rights are granted with a lease issued under
this part?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.201 How will BOEM issue leases?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.202 What types of leases will BOEM issue?
BOEM has finalized the proposed technical revision to this section
to make it consistent with subsection 8(p) of OCSLA. BOEM also added a
citation, as proposed, to Sec. 585.239 for leases issued for renewable
energy research activities. BOEM received no comments on whether to
include research leases as a type of lease that BOEM may issue.
Sec. 585.203 With whom will BOEM consult before issuance of
leases?
BOEM finalized several edits to this section; some were proposed in
the NPRM and others were not. BOEM made technical and editorial
corrections to improve readability. BOEM added the Native Hawaiian
Community and Alaskan Native Corporations to the list of entities that
BOEM consults with before the issuance of leases, after a commenter
pointed to the absence of the Native Hawaiian Community. Also, in the
first sentence of this section, BOEM reordered the list of entities
with which BOEM must consult such that Tribes are mentioned ahead of
states to represent the special status of Tribal governments.
Sec. 585.204 What areas are available for leasing consideration?
No changes were proposed for this section. The final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.205 How will leases be mapped?
No changes were proposed for this section. The final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.206 What is the lease size?
No changes were proposed for this section. The final rule adds no
additional changes. BOEM received no comments on this section.
Sec. Sec. 585.207-585.209 [Reserved]
Competitive Lease Award Process--Pre-Auction Provisions
Sec. 585.210 What are the steps in BOEM's competitive lease award
process?
Section 585.210 provides an overview of the competitive leasing
process and effectively merges existing Sec. Sec. 585.210 and 585.211.
This final rule replaces, as proposed, the request for interest in the
existing Sec. 585.210 with a request for information in the revised
Sec. 585.116. The revised Sec. 585.210 now provides an
[[Page 42687]]
overview of the entire competitive leasing process by including two
steps that are not currently mentioned in the existing section: the
auction and lease award. Please refer to the Lease Issuance Procedure
section of Section III above for a discussion of the public comment
related to this section and BOEM's responses to those comments.
Sec. 585.211 What is the Call?
Section 585.211 consolidates, as proposed, existing Sec. Sec.
585.211(a), 585.213, and 585.214, which describe the information
requested by the Call, the information a respondent should include in
its response if it wishes to nominate one or more areas for a
commercial renewable energy lease within the preliminarily identified
leasing areas, and BOEM's handling and processing of the information
received. The primary purpose of this change is reorganization; no
substantive changes have been made to BOEM's existing regulations and
practice. BOEM has removed the reference to withholding privileged and
confidential information as being redundant with the protections
already described in Sec. 585.114. Please refer to the Lease Issuance
Procedure section of Section III above for a discussion of the public
comment related to this section and BOEM's responses to those comments.
Sec. 585.212 What is area identification?
Section 585.212 provides more clarity regarding BOEM's area
identification process, thus expanding the description of this step in
Sec. 585.210(b)(2), largely as proposed. BOEM otherwise has not made
any substantive change to the existing process. Please refer to the
Lease Issuance Procedures section of Section III above for a discussion
of the public comments related to this section and BOEM's responses to
those comments, as well as the revisions made to the proposed rule
language in this final rule.
This section clarifies that BOEM balances potential OCS renewable
energy development with competing uses and environmental concerns
during area identification and attempts to resolve foreseeable issues.
Consistent with the existing regulations and practice, BOEM will
determine during area identification whether specific OCS areas are
suitable for further consideration for renewable energy development
with appropriate mitigation.
BOEM will consider any factors that it determines relevant during
this process. These factors may include, but would not necessarily be
limited to, other uses in and around the area, applicable environmental
analysis, formal and informal stakeholder comments, industry
nominations, and the area's feasibility for development. Consideration
of the area's feasibility for development could include, but would not
be limited to, analysis of the area's size and other relevant physical
conditions, potential electrical generation capacity, pertinent
technical data, and applicable electricity market and offtake
information. For example, BOEM may incorporate a high-level assessment
of an area's characteristics that would be relevant to potential
development, such as bathymetry, distance to shore, and wind resources,
and may consider an adjacent State's offshore wind energy offtake or
incentive programs.
BOEM retains the flexibility to modify the selection of parcels
offered for leasing after area identification and before the auction.
Also consistent with the existing regulations, BOEM will use the area
identification process to inform its NEPA review and associated
interagency consultations to evaluate the potential effects of
activities that are expected to take place after lease issuance on the
human, marine, and coastal environments and on other environmental
requirements. The NMSA may apply to any actions that may injure
sanctuary resources or that may require permits for placement of
equipment or disturbance of covered submerged lands. In any case where
a NMSA permit may be required, NOAA may require certain financial
assurances for infrastructure removal activities potentially required
under permit. BOEM may continue to develop lease stipulations or other
measures as part of its NEPA review to mitigate potential adverse
impacts and may hold public hearings regarding its environmental
analyses after potential lease areas have been identified.
Commenters noted that BOEM changed the use of the word ``will'' to
``may'' in paragraph (c)(3) of this section and requested that we
change it back.\22\ As a result, BOEM is not carrying forward this
change in the final rule. BOEM added a clarification that while
mitigation measures and stipulations are identified during the Area
Identification process, they continue to be identified throughout later
environmental reviews and consultations and may not be published until
the PSN.
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\22\ BOEM's existing regulations as published in 2009 at Sec.
585.211(b)(2): ``we will evaluate the potential effect of leasing on
the human, marine and coastal environments and develop measures to
mitigate adverse impacts including lease stipulations'' and Sec.
585.211(b)(3): ``we will consult to develop measures, including
lease stipulations and conditions, to mitigate adverse impacts on
the environment.'' Contrast with the NPRM at Sec. 585.212(c)(1):
``BOEM may develop measures, including lease stipulations, to
mitigate potential adverse impacts.''
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Sec. 585.213 What information is included in the PSN?
The NPRM analyses of the proposed sections on the PSN and the FSN,
Sec. Sec. 585.213 and 585.214, respectively, emphasized the close
interrelationship between the notices, and how the first enhanced an
understanding of the second.
The PSN and FSN are closely related, but separate and distinct
notices published in the Federal Register that detail the auction
procedures and lease provisions relevant to a particular lease sale.
The PSN proposes procedures and provisions and invites public comment
on them, whereas the FSN establishes the final procedures and
provisions. BOEM uses the public comments received in response to the
PSN to inform its decisions regarding the final procedures and
provisions in the FSN.
With this final rule, Sec. Sec. 585.213 and 585.214 will replace,
as proposed, the information currently contained in Sec. 585.216 of
the existing regulations. These sections do not change substantially
the nature, scope, or content of the PSN and FSN from BOEM's existing
regulations and practice. However, these new sections clarify BOEM's
existing authority to set a maximum number of lease areas that an
individual party may bid on or acquire in an auction. This final rule
separates the PSN and FSN regulations into individual sections because,
although the notices are closely related, each notice represents a
distinct step in the leasing process. The PSN and FSN continue to serve
as the primary sources of information for prospective bidders on the
lease areas, auction procedures, and lease provisions. In addition,
Sec. 585.223 outlines supplemental auction information that BOEM may
be provide in a PSN or FSN.
Please refer to the Lease Issuance Procedures section of Section
III above for a discussion of the public comments related to this
section and BOEM's responses to those comments.
Sec. 585.214 What information is included in the FSN?
The same changes were made to Sec. 585.214 that were made in Sec.
585.213, as described in the proposed rule. Please refer to the
section-by-section analysis of Sec. 585.213 above for a description of
those changes and to the Lease Issuance Procedures section of Section
III of this preamble for a discussion of the public comments and BOEM's
responses to those comments for this section.
[[Page 42688]]
As noted in the response to comments section M.3, in response to
suggestions to use particular bidding credits, such as one to promote
shared transmission lines, BOEM develops and proposes any bidding
credits in the PSN, and later confirms their use in the FSN, which
allows for comments and potential modification. Such credits could be
offered in future lease sales when deemed appropriate, however, this is
beyond the scope of the current rulemaking.
Sec. 585.215 What may BOEM do to assess whether competitive
interest for a lease area still exists before the auction?
BOEM's existing regulations at Sec. 585.212 explain the process
BOEM follows if it had a reason to believe competitive interest no
longer existed before the FSN was issued. The revised Sec. 585.215, as
proposed, maintains the same process for determining whether
competitive interest remains and for acting on that determination. This
section clarifies, however, that BOEM may implement this process any
time before the auction when it has reason to believe competitive
interest is absent. BOEM may proceed with an auction regardless of the
result of its competitive interest inquiry under this section. BOEM did
not receive comments on this section.
Sec. 585.216 How are bidding credits awarded and used?
As proposed and now made final, Sec. 585.216 allows the
provisional winner's bid to include the value of any bidding credits
awarded if the provisional winner has made certain demonstrable
commitments that facilitate OCS renewable energy development and that
reflect a developmental advantage, or advance public policy. For
instance, a power purchase agreement. The PSN and FSN will prescribe
the use of bidding credits in a particular auction, including
eligibility requirements, application procedures, and the types and
values of available credits. BOEM would retain discretion not to offer
bidding credits in any given auction.
A bidder will be awarded bidding credits before the auction if it
timely submits a bidding credit application that includes the requisite
commitments and meets eligibility requirements under the FSN and part
585. Depending on the FSN provisions, a bidder might be eligible for
multiple bidding credits if the bidder meets the criteria for each
credit. The FSN could provide for bidding credits that are
``stackable'' or ``non-stackable.'' Stackable credits are those where
the total value of one's bidding credits would be the sum of all the
credits for which the bidder was eligible. Alternatively, the FSN may
limit the bidding credits to non-stackable credits, where the total
value of a bidder's bidding credits would be limited to the value of
the largest bidding credit for which the bidder was eligible. Stackable
credits would incentivize bidders to meet the criteria for as many of
the available bidding credits as they can. Alternatively, using non-
stackable credits would limit the total value of the non-monetary
component of the bid. Bidding credits may be denominated as either a
sum certain or a percentage of the bid, as specified in the FSN.
The FSN specifies the procedures, timing, and eligibility
requirements for bidding credits. BOEM will inform bidders before the
auction of the value of each bidding credit for which they are
eligible. A provisional winner who received bidding credits would pay
its bonus as the amount of the cash component of its winning bid less
the bid deposit, as prescribed in the FSN. Paragraph (b) of this
section further specifies that the qualification process to obtain
bidding credits must be done in advance of any lease auction, in
accordance with the specifications of the FSN; however, such
qualifications may be obtained either for actions that the bidder has
already undertaken or for actions that it has committed to undertake in
the future, provided that BOEM has agreed to the terms by which such a
commitment will be made. If a bidder receives a bidding credit for a
commitment to future action, acceptance of the lease would constitute
an obligation to undertake those actions, and failure to do so would
constitute noncompliance with the lease.
In response to comments on whether the regulations should codify
BOEM's past practice of imposing a cap on the value of bidding credits
that any bidder can earn, measured as either an absolute dollar amount
or as a percentage of the bid amount, BOEM did not include a cap or
limit but expects to continue its practice of limiting bidding credits
to a maximum of 25 percent of the value of the high bid unless BOEM
determines that a higher bidding credit is warranted for a particular
sale. In Sec. 585.216(b), BOEM listed a half dozen examples of bidding
credits that BOEM could use in future lease sales. Commenters suggested
others, and in many cases asked that BOEM include them in the list of
examples provided. BOEM did not include these in the list, but it's
authority to include such bidding credits in future sales is preserved
by Sec. 585.216(b)(7), which permits to offer bidding credits for
``any other factor or criteria to further development of offshore
renewable energy, as identified by BOEM in the PSN and FSN.''
Please refer to the Lease Issuance Procedures section of Section
III above for further discussion of the public comments related to this
section and BOEM's responses to those comments.
Sec. Sec. 585.217-585.219 [Reserved]
Competitive Lease Award Process--Auction Provisions
Sec. 585.220 How will BOEM award leases competitively?
BOEM is planning to continue to implement multiple factor auctions,
through the use of bidding credits, to allow the competitive lease
award process to take into consideration various priority actions, such
as advancing a domestic supply chain and workforce training, consistent
with the goals of OCSLA. As noted previously, bidding credits represent
a monetary value assigned by BOEM to the actions or factors
demonstrated or committed to by a bidder at a BOEM lease auction during
the competitive lease award process. The value of the bidding credits
would be added to the value of the cash bid to determine who is the
highest bidder.
The existing regulations at Sec. Sec. 585.220 through 585.222 set
forth options that BOEM could have used for auction formats, bidding
systems, and bid acceptance criteria for both commercial and limited
leases. As discussed in section Lease Issuance Procedures section of
Section III, these regulations were overly prescriptive and required
clarification and modification to provide BOEM with flexibility to
adopt new and innovative auction processes and procedures. Revised
Sec. 585.220, as was proposed, replaces those sections with a
simplified and flexible approach that would allow BOEM to use any
auction process, including multiple factors, and any procedure that is
objective, fair, reasonable, and competitive; awards a lease based upon
the highest total bid; and provides a fair return to the United States.
This section also clarifies that the specific process for each auction
will be noticed in the PSN and, subject to revisions, finalized in the
FSN.
Sec. 585.221 What general provisions apply to all auctions?
As was proposed, this revised section sets forth the provisions and
rules applicable to all auctions. This section codifies the existing
practice whereby BOEM conducts an auction if it determines, after the
Call, that competitive interest exists for renewable energy development
on parcels of the OCS and decides to issue leases within those areas.
Section 585.221 codifies the
[[Page 42689]]
use of the FSN to prescribe the detailed process for any auction.
Section 585.221(d) adds details to outline the circumstances under
which BOEM may delay, suspend, cancel, and restart an auction due to a
natural or man-made disaster, technical malfunction, security breach,
unlawful bidding activity, administrative necessity, or any other
reason that BOEM determines may adversely affect the fair and efficient
conduct of the auction. Section 585.221(d) also adds a provision that
authorizes BOEM to restart the auction at whatever point it deems
appropriate, reasonable, fair, and efficient for all participants; or,
alternatively, cancel the auction in its entirety.
Sec. 585.222 What other auction rules must bidders follow?
Section 585.222 establishes a set of procedures and rules of
conduct for bidders, as proposed. This section is consistent with
BOEM's existing practices, including requirements that bidders submit
bid deposits in accordance with Sec. 585.501 and meet Sec. Sec.
585.107 and 585.108 qualification requirements. If the awarded lease is
executed by an agent acting on behalf of the bidder, the bidder must
submit, along with the executed lease, written evidence that the agent
is authorized to act on behalf of the bidder, as is already required
under existing Sec. 585.224(g).
Please refer to the Lease Issuance Procedure section of Section III
above for a discussion of the public comments related to this section
and BOEM's responses to those comments, as well as the revisions made
to the proposed rule language in this final rule.
Sec. 585.223 What supplemental information will BOEM provide in a
PSN and FSN?
Consistent with the proposed rule, section 585.223 contains a non-
exhaustive list of supplemental auction details likely to be contained
in a PSN and FSN. Although this section lacks an analogue in the prior
regulations, the supplemental details listed in this section generally
are consistent with the information that BOEM has provided in recent
PSNs and FSNs. This section clarifies the concept of the next highest
bidder and describes the process to determine the next best bid if the
provisional winner fails to meet its obligations or is otherwise unable
to acquire the lease. The next best bidder criteria will be detailed in
the PSN and FSN. BOEM did not receive comments on this section.
Competitive Lease Award Process--Post-Auction Provisions
Sec. 585.224 What will BOEM do after the auction?
Section 585.224 finalizes the NPRM proposal and outlines the steps
that BOEM will take following the end of an auction. The revisions to
this section make explicit existing practices that are consistent with
OCSLA and that have proven effective in BOEM's auctions thus far.
Section 585.224 retains BOEM's existing authority in Sec. Sec.
585.222(a)(2) and 585.224(f) to reject and accept bids and to withdraw
lease areas between auction completion and lease execution. Finally, if
an auction results in unsold lease areas, revised Sec. 585.224
clarifies that BOEM has the discretion to re-auction those unsold areas
after the auction by restarting the competitive leasing process at any
reasonable and appropriate step in that process.
Please refer to the Lease Issuance Procedure section of Section III
above for a discussion of the public comments related to this section
and BOEM's responses to those comments.
Sec. 585.225 What happens if BOEM accepts a bid?
Section 585.225 sets forth the steps BOEM and the provisional
winner will take after the auction. This section functions similarly to
the existing regulations at Sec. 585.224(a), (b), (c), and (e), but
contains several new provisions. First, this section provides that BOEM
will refund, without interest, any portion of the provisional winner's
bid deposit that exceeds the amount due from the winning bid. Second,
this section permits BOEM to extend the 10-business-day deadline for
the completion of the provisional winner's obligations to allow greater
flexibility in addressing unforeseen situations, such as a Federal
government shutdown or pandemic. This section will require payment of
the first 12 months' rent within 45-calendar days after the provisional
winner receives the executed lease from BOEM as opposed to 45 calendar
days after receiving the three unexecuted lease copies as provided
under the existing regulations. Finally, under this section, the
provisional winner will become the winning bidder when BOEM executes
the lease after any properly filed appeals under revised Sec.
585.118(c) have been resolved. The effective date of the lease would
continue to be governed by Sec. 585.237. In addition to the edits
proposed in the NPRM, we have eliminated references to sending three
copies of the lease document, facilitating electronic transmission of
documents.
Please refer to the Lease Issuance Procedure section of Section III
above for a discussion of the public comments related to this section
and BOEM's responses to those comments, as well as the revisions made
to the proposed rule language in this final rule.
Sec. 585.226 What happens if the provisional winner fails to meet
its obligations?
Existing Sec. 585.224(d) provides that a winning bidder will
forfeit its bid deposit if it fails to execute and return the lease
within 10 business days or otherwise fails to comply with applicable
regulations or terms of the FSN. While no winning bidder has failed to
meet its post-auction obligations thus far, BOEM recognizes the
potential for such a situation and seeks to provide flexibility in its
response to such a possibility.
In the final rule, Sec. 585.226 specifies that, if BOEM determines
that a provisional winner has failed to meet its obligations under
Sec. 585.225(b) or Sec. 585.316, or has otherwise failed to comply
with applicable laws, regulations, or FSN provisions, BOEM may require
forfeiture of the bid deposit. In the event the bid deposit exceeds the
winning bid, BOEM would limit the required forfeiture amount to the
lesser amount, that of the winning bid.
Section 585.226 also sets forth the additional actions BOEM could
take if a provisional winner fails to meet its obligations. These
possible actions would include refusal to award other leases won by the
provisional winner in the auction and referral to the Department's
Administrative Remedies Division for suspension or debarment review
pursuant to 2 CFR part 180 as implemented at 2 CFR part 1400. This
section also specifies that, if the provisional winner fails to meet
its obligations or is otherwise unable to execute a lease, BOEM could
select a new provisional winner by either repeating the auction,
selecting the next highest bid, or using other criteria specified in
the FSN. No comments were received on this section.
Sec. Sec. 585.227-585.229 [Reserved]
Noncompetitive Lease Award Process
Sec. 585.230 May I request a lease if there is no Call?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.231 Will BOEM issue leases noncompetitively?
In the NPRM, BOEM had proposed several modifications, both
significant
[[Page 42690]]
and minor, to its noncompetitive leasing process. First, this final
rule clarifies in paragraph (a) that BOEM will only use the
noncompetitive process if it ``determines after public notice of a
proposed lease, easement, or right-of-way that there is no competitive
interest.'' \23\
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\23\ 43 U.S.C. 1337(p)(3).
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Second, in the event that a company submits a request for BOEM to
issue a lease and submits the required acquisition fee, BOEM may issue
a request for information in the Federal Register to determine whether
any other companies also have an interest in that area. In the event
that BOEM issues such a request for information and no responses are
received, BOEM may issue a lease noncompetitively. This final rule
revises paragraph (b) to clarify that BOEM has discretion to determine
whether an unsolicited lease request should be the subject of a request
for information. BOEM occasionally receives unsolicited requests for
areas that it may deem inappropriate for leasing without seeking public
input (e.g., previously leased areas or areas that straddle a USCG
traffic separation scheme). In the event that BOEM elects not to issue
a request for information in response to the unsolicited lease request,
BOEM would not issue a lease noncompetitively and would instead refund
the acquisition fee.
Third, this final rule adds a timeline and sunset provision to
BOEM's noncompetitive leasing processes. The existing regulations
established neither an expiration date for a DNCI nor deadlines for the
noncompetitive leasing process. If BOEM had left the regulations in the
existing form, this could have allowed a company to obtain a
noncompetitive lease in situations where there may potentially be other
interested lessees in the future (due to changes in circumstances).
Accordingly, the newly adopted paragraphs (d) and (e) create the
following milestones for the noncompetitive leasing process:
After publication of the DNCI, BOEM would prepare and
provide the beneficiary with a written estimate of the fees to pay for
the processing costs under Sec. 585.112, including conducting an
environmental review prior to lease issuance.
The beneficiary has 90 calendar days from receipt of the
fee estimate to pay the fee.
The DNCI would expire within two years of publication,
unless BOEM determines, on a case-by-case basis, that this timeframe
should be extended.
Fourth, this final rule clarifies in paragraph (d)(3) that BOEM
will conduct an environmental review of a noncompetitive lease request
that it determined had no competitive interest but which BOEM intends
to process. Fifth, this final rule specifies that BOEM will make a
final decision as to whether to issue a noncompetitive lease after the
completion of its environmental review and other reviews required by
Federal law (e.g., CZMA). Section 585.231, paragraph (f), clarifies
that for noncompetitive leases, CZMA concurrences would be processed
pursuant to 15 CFR part 930, subpart D. Based on its experience, BOEM
expects this to be a rare occurrence. BOEM clarified that the
applicant's submissions to the State CZM agency be done ``in a timely
manner'' so as not to delay the progress of the BOEM application for a
noncompetitive lease and added conforming edits to the analogous
section for ROWs and RUEs in Sec. 585.306(b).
Finally, this final rule makes several miscellaneous technical
corrections and clarifications to this section. It revises the existing
section heading to reflect the scope of this section more accurately.
The ``RFI'' referenced in Sec. 585.231(b) is being replaced with ``an
RFI under Sec. 585.116, meaning a ``request for information in lieu of
a ``request for interest''. This final rule would make administrative
changes to Sec. 585.231(c)(1) and (h)(1)(ii) to reflect updated cross-
references in this final rule. This final rule also revises the payment
due date for the first 12 months' rent on a lease consistent with
changes to Sec. Sec. 585.225 and 585.503. The remainder of the
noncompetitive lease issuance process remains substantially the same as
in the prior regulations.
In addition to finalizing the proposed changes, the final rule also
makes some technical edits to this section. Due to the widespread
adoption of electronic copies, in Sec. 585.225(b), BOEM removed
references to BOEM sending three unsigned copies of the lease form to
the provisional winner and removed the provisional winner's obligation
to execute three copies. BOEM no longer needs to sign three copies, and
BOEM will send the new lessee an electronic version of the executed
lease. Corresponding changes were made in Sec. 585.231(h) for
noncompetitive leases.
Please refer to the Lease Issuance Procedure and Other Proposed
Changes in Part 585 sections of Section III above for a discussion of
the public comments related to this section and BOEM's responses to
those comments, as well as the revisions made to the proposed rule
language in this final rule.
Sec. 585.232 May I acquire a lease noncompetitively after
responding to a request for information or a Call for Information and
Nominations?
This final rule revises the section heading of Sec. 585.232 to
reflect the change in nomenclature in proposed Sec. 585.116 from
``request for interest'' to ``request for information.'' It also
revises paragraph (c) to incorporate changes to the cross-referenced
provisions associated with this final rule.
No Comments were received on this section.
Sec. Sec. 585.233-585.234 [Reserved]
Commercial and Limited Lease Periods
Sec. 585.235 What are the lease periods for a commercial lease?
Consistent with the proposed rule, BOEM is overhauling the
organization and duration of its commercial leases as well as the
triggers that move a lease from one period of a lease to another. These
changes are responsive to industry comments, reflect BOEM's experience
administering its leasing and plan review programs, and arise from
other aspects of this rulemaking--particularly the elimination of the
SAP for met buoys.
Under the existing regulations, BOEM's commercial leases comprised
three ``terms'':
A preliminary term of 12 months, starting at lease
execution and typically ending with the submission of an SAP.
A site assessment term of 5 years, starting at SAP
approval and ending with the submission of a COP.
An operations term of 25 years, typically starting at COP
approval.
Up to now, BOEM has automatically tolled the preliminary and site
assessment terms during its review of submitted plans; a lessee could
request additional time extensions if it did not timely file a plan.
This final rule makes numerous changes to the text and structure of
Sec. 585.235(a). First, as proposed, BOEM renames its lease ``terms''
as lease ``periods'' to describe the progression of its commercial
leases more appropriately. This change in nomenclature is intended to
more accurately distinguish between stages of lease development that
under the existing regulations were covered by the same term. For
example, construction and operations represent very different stages of
development, deserving of separate treatment under the regulations.
Next, as proposed, BOEM merged the preliminary and site assessment
terms into one 5-year preliminary period that commences on the lease
effective date and ends either with the submittal of a COP to BOEM for
its review or five years after the lease effective date,
[[Page 42691]]
whichever occurs first. This change flows directly from BOEM's proposal
to eliminate the SAP requirement for met buoys.\24\ Given that most
lessees are not expected to submit an SAP under the final rule, BOEM
believes it no longer makes sense for a lease to contain a deadline for
SAP submittal--much less to use that deadline to trigger a new phase of
the lease. (As discussed in the section-by-section analysis of Sec.
585.601 in section below, BOEM also has removed all deadlines for SAP
submittals.)
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\24\ See supra section V.A, entitled ``Site Assessment
Facilities,'' for complete discussion.
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Consistent with the proposed rule, this final rule creates two
additional lease periods between the submission of the COP and the
operations period: the COP review period and the design and
construction period. As proposed, the COP review period starts at COP
submittal and ends upon BOEM's decision on whether to approve or
disapprove the COP or approve the COP with conditions pursuant to Sec.
585.628. As proposed, BOEM did not establish a fixed length for the COP
review period in the final rule to preserve regulatory flexibility and
to allow for harmonization with recent government-wide permit review
streamlining initiatives (e.g., FAST-41).\25\
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\25\ Fixing America's Surface Transportation Act Title 41, 42
U.S.C. 4370m et seq.
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However, in the final rule, BOEM did not adopt the proposed one-
year time limit for a lessee after its initial COP submission to
resolve issues identified by BOEM and to finalize its COP. BOEM
recently published guidance that addresses these issues in a more
nuanced manner than the one-year proposal described in the NPRM.\26\
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\26\ Information Needed for Issuance of a Notice of Intent (NOI)
Under the National Environmental Policy Act (NEPA) for a
Construction and Operations Plan. (Aug. 2023) available at https://www.boem.gov/sites/default/files/documents/renewable-energy/state-activities/BOEM%20NOI%20Checklist.pdf).
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In the final rule, the design and construction period starts at COP
approval and ends when the operations period begins. In the final rule,
BOEM changed the ending of the design and construction period from the
proposed ending of ``either when commercial operations begin or at the
expiration of the period set forth in the approved COP as modified'' to
the more precise ``when the operations period begins.'' Likewise, BOEM
declined to implement a provision in the proposed rule that would have
required COPs to include a proposed timeline for the design and
construction period, subject to approval by BOEM as part of the COP
review. These revisions improved the clarity and consistency of the
transition between the design and construction period to the operations
period and supported BOEM's changes to the operations period at Sec.
585.235(a)(4) which disconnected the beginning of the operations period
from the commencement of commercial operations of any facility.
Instead, the operations period commences when the requirements of 30
CFR 285.637 are met for an entire project area through the submission
of final reports and records. Many of the aforementioned changes were
made in response to comments, as discussed further in Other Proposed
Changes in Part 585, section III above.
BOEM originally proposed that the operations period commence at the
commercial operations start date and remain in effect for 30 years. In
the final rule, BOEM implemented a default 35-year operations period
based on the expected utility of project facilities and comments
received on the NPRM. BOEM's previous regulations established a default
construction and operations term of 25 years, though because this
period includes the time needed to construct the project, the actual
duration of operations would be as much as several years less than
that. Commenters have indicated that this is less than the projected
life of the facilities being installed, and technical advancements will
likely push the design life of offshore wind facilities even further.
BOEM is making two other changes to the proposed operations period.
First, BOEM added language to allow a lessee to propose an extension to
the operations period for their project within their COP. This change
is more efficient than the NPRM proposal because it allows BOEM to
approve an alternate operations period, as an element of COP approval,
that is specifically tailored to the purpose and need for the project,
as well as the projected life of the project facilities. Second, BOEM
replaced the trigger for the commencement of the operations period. The
NPRM proposed the operations period would commence at the start of
commercial operations. The final rule replaces this trigger with ``when
the requirements of Sec. 285.637(a) are met through the submission of
final reports and records for your project.'' The final rule ties the
commencement of the operations period more closely to the completion of
construction and installation than the NPRM did. This change also
reflects the revised definition of commercial operations included in
the final rule, which would result in commercial operations beginning
in many cases during testing and first power. Larger projects may be
constructed, tested and powered over several seasons and even years,
therefore, BOEM finds it more appropriate to set the operations period
to begin when construction and installation is substantially complete.
Some of the aforementioned changes were made in response to comments,
as discussed further in Other Proposed Changes section in part 585 of
section III above.
The Department recognizes that existing lessees may seek
modification of their leases to conform to the new lease periods, among
other changes. BOEM intends to contact existing lessees with a proposal
for amending leases to take advantage of certain revisions made in this
final rule.
In addition to revamping the structure of its commercial leases,
the Department proposed several provisions aimed at granting a lessee
more flexibility throughout the development process. First, the
Department proposed expanding the criteria in Sec. 585.235(b) for
granting extensions of lease periods. Previously, the only enumerated
basis for extending the preliminary term or the site assessment term
was if a lessee submitted a plan late. The Department proposed to
clarify that it has discretion to extend any lease period for good
cause. In the final rule, BOEM includes the ``good cause'' rationale as
well as the additional descriptor ``including if the project is
designed and verified for a longer duration'' as an illustration of
``good cause.''
Second, the Department proposed a new Sec. 585.235(c) clarifying
that a lessee may propose an alternative lease period schedule if it
chooses to develop its lease in phases. Numerous lessees have expressed
interest in phased development of their leases, but the previously
existing regulations did not explicitly set forth a process for
modifying the default lease schedule if a lessee intends to defer
development on portions of its lease area. Third and relatedly, the
Department proposed a new Sec. 585.235(d) providing that a lessee may
seek modification of the default lease schedule in its application to
segregate its lease or consolidate two adjacent leases. With this final
rule, all of the aforementioned proposed changes have been implemented,
with one additional change made in the final rule.
In the final rule BOEM changed ``you may propose lease period
schedules for each phase in your COP'' to ``you must propose lease
period schedules for each phase in your COP'' due to the potential need
for a separate lease period schedule for latter phase(s). Notably,
[[Page 42692]]
BOEM anticipates that this would typically include a different
operations period for latter phase(s)--one that would begin well after
project construction was substantially complete for the first phase.
Consequently, for a phased development COP, each phase will have its
own lease period schedule upon COP approval that was informed by the
lessee's request, BOEM's review of the request, and the resulting BOEM-
approved schedule. This process for establishing the lease period
schedule for phased development COPs avoids unintentional barriers to
phased development that could result if a lessee did not provide lease
period schedule information for each phase of the project. Every year
of an operations period, in particular, holds significant commercial
value and BOEM's intent is to ensure due diligence on leases, while
balancing the need to support key development flexibilities enshrined
in BOEM's regulations, most notably phased development. Such a balance
is achieved here because the lessee is demonstrating due diligence on
the first phase of its lease while continuing to mature latter phases.
Finally, this change supports providing certainty to a lessee regarding
the operations period of its renewable energy project.
As discussed in the section-by-section analyses of Sec. Sec.
585.410 and 585.413 below, BOEM previously approved lease segregation
and consolidation requests and anticipates more such requests in the
future. However, unlike these new regulations, the previous regulations
did not explicitly address the effects these actions might have on
lease schedules.
Please refer to the Other Proposed Changes in Part 585 section of
section III above for additional discussion of the public comments
related to this section and BOEM's responses to those comments, as well
as the revisions made to the proposed rule language in this final rule.
Sec. 585.236 If I have a limited lease, how long will my lease
remain in effect?
With this final rule, BOEM substituted the word ``period'' for
``term'', as proposed, to ensure consistency with its changes to Sec.
585.235. Additionally, because limited leases may allow a wide range of
activities, this final rule would replace the existing five-year
operations term with an operations period of a duration to be
determined by BOEM prior to auction (if the lease is issued
competitively) or negotiated with the applicant (if the lease is issued
noncompetitively). In either case, the length of the term will depend
on the intended use of the lease. The existing regulations specified
that extensions of the preliminary term may be requested if the GAP for
the limited lease was not going to be submitted in a timely manner.
With this final rule, BOEM will allow extensions of a limited lease's
preliminary period only if the requested extension can be justified for
``good cause.'' Consistent with the changes to Sec. 585.235, BOEM will
also allow extensions of a limited lease's operations period if the
requested extension can be justified for ``good cause.''
No comments were received on this section.
Sec. 585.237 What is the effective date of a lease?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.238 May I develop my commercial lease in phases?
As a result of the Reorganization Rule (88 FR 6376), this section
was removed from Sec. 585.629 as specified in 76 FR 64763, and added
as Sec. 585.238 in the final rule. In the final rule BOEM added ``You
must also propose a lease period schedule for each phase in your COP in
accordance with Sec. 585.235(c)'' in support of the referenced text in
Sec. 585.235 and to ensure clarity. In addition, BOEM added, ``BOEM
may condition its approval of subsequent phases described in a phased
development COP'' to facilitate phased development. BOEM added this
sentence in response to a recommendation of a commenter. This change,
like the changes to the lease periods included in the NPRM and final
rule, removes barriers to phased development of leases and supports a
more fulsome implementation of those changes.
Sec. 585.239 Are there any other renewable energy research
activities that will be allowed on the OCS
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. Sec. 585.240-585.299 [Reserved]
E. 30 CFR Part 585, Subpart D--Right-of-Way Grants and Right-of-Use and
Easement Grants for Renewable Energy Activities
Subpart C, Right-of-Way Grants and Right-of-Use and Easement Grants
for Renewable Energy Activities, has been redesignated as subpart D to
accommodate the addition of a new subpart B, as noted in Renewable
Energy Leasing Schedule section of Section III above.
Row Grants and RUE Grants
In response to the comment recommending defining roles among BOEM,
DOE, FERC, and RTO/ISO, BOEM agrees that coordination among these
entities is critical to the transmission planning process and will
continue to take steps to further refine roles and responsibilities as
the industry continues to develop. Additionally, BOEM and FERC signed a
Memorandum of Understanding (MOU) on April 9, 2009. The purpose of this
MOU was to clarify jurisdictional understanding regarding renewable
energy projects in offshore waters on the OCS, in order to develop a
cohesive, streamlined process that would help accelerate the
development of wind, solar, and hydrokinetic (i.e., wave, tidal, and
ocean current) energy projects. Additional updates to the rulemaking
with respect to the ROW and RUE provisions were made in response to
comments, as described further in Section III above.
Sec. 585.300 What types of activities are authorized by ROW grants
and RUE grants issued under this part?
The only change that this final rule makes to this section is
replace the word ``an'' with ``a'' in three places. BOEM received no
comments on these proposed changes and makes no changes to them in the
final rule.
Sec. 585.301 What do ROW grants and RUE grants include?
BOEM has removed, as proposed, the previously prescribed width of
ROWs, in order to implement the PDE approach discussed above in Project
Design Envelope and Geophysical and Geotechnical Surveys sections of
Section III, and to maintain consistency with BOEM's proposed revisions
to Sec. 585.628(g) for project easements. BOEM is also clarifying that
a subsea cable ROW may need to accommodate multiple associated
facilities. BOEM received no substantive comments on this section.
Sec. 585.302 What are the general requirements for ROW grant and
RUE grant holders?
BOEM has implemented a technical correction to update the cross
references in this section, reflecting that an applicant must meet the
qualifications set forth in Sec. Sec. 585.107 and 585.108 in order to
acquire a ROW or RUE. BOEM received no comments on this section.
Sec. 585.303 How long will my ROW grant or RUE grant remain in
effect?
BOEM has substituted the word ``period'' for ``term'' to ensure
consistency with the changes to Sec. 585.235. By renaming the
preliminary term of a ROW and RUE as the
[[Page 42693]]
preliminary period, BOEM intends to more accurately distinguish between
the entire term of a ROW and RUE and its constituent parts. As with
Sec. 585.235, BOEM also anticipates that this revision will clarify
whether and when a grantee has control of its ROW or RUE. BOEM is
providing the same flexibility for the operations period of its grants
as it has with the operations period for its limited leases in proposed
Sec. 585.236(a)(2), both in terms of start date and duration. Finally,
BOEM will allow extensions of either grant period, consistent with its
changes to Sec. 585.235. The existing regulations specified that the
GAP must be submitted no later than the end of the preliminary period
in order for the grant to remain in effect. With this rulemaking, BOEM
has implemented a change whereby the preliminary period may be extended
if the requested extension can be justified for ``good cause.''
BOEM's existing regulations specified that the ROW grant or RUE
grant would remain in effect for as long as it is being used for the
purpose for which it was granted. This rule has modified that provision
by introducing an operations period as set by BOEM (if the grant is
issued competitively) or negotiated with the applicant (if the grant is
issued noncompetitively). The duration of the operations period will
depend on the intended use of the grant. BOEM will allow extensions of
a ROW grant or RUE grant operations period if the requested extension
can be justified for ``good cause,'' as determined by BOEM.
Sec. 585.304 [Reserved]
Obtaining Row Grants and RUE Grants
Sec. 585.305 How do I request a ROW grant or a RUE grant?
A technical edit has been made to this section as a result of the
Reorganization Rule (88 FR 6376). BOEM has eliminated the paper copy
requirement, consistent with the revised provisions in Sec. 585.111.
BOEM received no comments on this section.
Sec. 585.306 What action will BOEM take on my request?
As a result of the Reorganization Rule (88 FR 6376), Sec. 585.306
adds two provisions to paragraph (b) from the existing Sec. 585.309
and removes the existing Sec. 585.309. This consolidation simplifies
and clarifies this subpart. Minor additional edits were made to this
section to ensure consistency with the addition of ``in a timely
manner'' to Sec. 585.231(f). Please refer to the Lease Issuance
Procedures section of Section III above for additional discussion of
the public comments related to this section and BOEM's responses to
those comments, as well as the revisions made to the proposed rule
language in this final rule.
Sec. 585.307 How will BOEM determine whether competitive interest
exists for ROW grants and RUE grants?
BOEM added, as proposed, the word ``generally'' to Sec. 585.307(a)
to clarify that BOEM does not need to specifically describe the
parameters of a future project and that a public notice need only
include enough information about the future project to allow potential
ROW and/or RUE grant holders to assess whether they would be interested
in competitively participating in an auction for the grant.
BOEM added a new paragraph (c) to the final rule to help align
Federal and State transmission processes, as in the case of
transmission ROWs, the State inherently must also issue a grant to
extend through State waters, and on land. This clarifies BOEM's
authority to take into consideration the competitive determination of a
State, regional transmission organization, or independent system
operator to satisfy the competition requirement of 43 U.S.C. 1337(p)(3)
in determining whether competitive interest exists for proposed
transmission. BOEM may issue a public notice to determine whether
competitive interest exists prior to the conclusion of a State or ISO/
RTO process that generally describes the potential ROW/RUE, BOEM's
coordination with the State or ISO/RTO process that requested use of
the OCS for a project supporting transmission from renewable energy,
and explaining that BOEM will make the determination of whether
competitive interest exists after assessing comments on the proposal
and area, but after the State or ISO/RTO has made decision on the
procurement of a project(s). This will allow BOEM to continue
coordination with the relevant intergovernmental partners necessary for
the consideration and permitting of such a project. This coordination
will help reduce the likelihood of a scenario where a State awards use
of State waters to one project proponent, and BOEM awards use of the
OCS to a different project proponent through a competitive process,
which would frustrate the goals of OCSLA of orderly and expeditious
development of renewable resources, and the goals of environmental
protection and the prevention of waste.
Please refer to the Lease Issuance Procedures section of Section
III above for additional discussion of the public comments related to
this section and BOEM's responses to those comments, as well as the
revisions made to the proposed rule language in this final rule.
Sec. 585.308 How will BOEM conduct an auction for ROW grants and
RUE grants?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.309 When will BOEM issue a noncompetitive ROW grant or
RUE grant?
The existing Sec. 585.309 was removed by this final rule as
redundant (see analysis of Sec. 585.306).
Sec. 585.309 What is the effective date of a ROW grant or a RUE
grant?
A technical edit has been made to this section as a result of the
Reorganization Rule (88 FR 6376). This section was re-numbered in this
final rule as Sec. 585.309 (from Sec. 585.310). The substance of this
section is unchanged.
Sec. Sec. 585.310-585.314 [Reserved]
Financial Requirements for Row Grants and Rue Grants
Sec. 585.315 What deposits are required for a competitive ROW
grant or RUE grant?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.316 What payments are required for ROW grants or RUE
grants?
A technical correction has been made to this section as a result of
the Reorganization Rule (88 FR 6376). BOEM made a technical correction
to reflect that Office of Natural Resources Revenue (ONRR) is the
appropriate payee.
Sec. Sec. 585.317-585.399 [Reserved]
F. 30 CFR part 585, subpart E--Lease and Grant Administration
Subpart D, Lease and Grant Administration, has been redesignated as
subpart E to accommodate the addition of a new subpart B, as proposed
and as noted in Renewable Energy Leasing Schedule section of Section
III.
Noncompliance and Cessation Orders
Sec. 585.400 What happens if I fail to comply with this part?
The previous Sec. 585.400 was moved to Sec. 585.106 by the
Reorganization Rule. Please refer to the Other Proposed Changes in Part
585 of Section III above for a discussion of the public comments
related to this section and BOEM's responses to those comments, as well
as the revisions made to the proposed rule language in this final rule.
Sec. Sec. 585.400-585.404 [Reserved]
Sections 585.401 and 585.402 have been deleted as unnecessary.
[[Page 42694]]
Designation of Operator
Sec. 585.405 How do I designate an operator?
BOEM updated citations in this section, as proposed, to maintain
consistency with changes in the organization of Sec. Sec. 585.626 and
585.645 and made a grammatical edit.
Sec. 585.406 Who is responsible for fulfilling lease and grant
obligations?
Following publication of the Reorganization Rule, BOEM added a
reference in this section to the regulations at 30 CFR part 285 to
clarify that the lessee or grantee is also responsible for fulfilling
obligations under the BSEE-administered regulations.
Sec. 585.407 [Reserved]
Lease or Grant Assignment, Segregation, and Consolidation
Sec. 585.408 May I assign my lease or grant interest?
BOEM added ``to one or more parties'' to paragraph (a) of the final
rule in response to comments requesting BOEM explicitly allow the
lessee to assign all or part of the lease area to other entities. BOEM
eliminated specific elements of the regulatory requirements for an
assignment application in paragraph (b) that are duplicative with many
of the requirements of Sec. 585.409, and that are also already
provided for in the form that is currently on the BOEM website for
leases (Form BOEM-0003) and grants (Form BOEM-0002). BOEM modified the
date on which an assignment becomes effective to better align this
requirement with BOEM's oil and gas regulations on the effective date
of assignments, found in 30 CFR 556.712. This final rule also clarifies
that paragraph (d) refers to mergers, name changes, or changes of
business form and not to the lease consolidation provisions of Sec.
585.413 and that the lessee must notify BOEM of these events under
Sec. 585.110.
Please refer to the Other Proposed Changes in Part 585 section of
Section III above for additional discussion of the public comments
related to this section and BOEM's responses to those comments, as well
as the revisions made to the proposed rule language in this final rule.
Sec. 585.409 How do I request approval of a lease or grant
assignment?
BOEM made technical changes to this section to update cross-
references in paragraphs (b) and (c) in the final rule.
This final rule added a new Sec. 585.410, as proposed, to explain
when an assignment would result in a segregated lease. BOEM added a
paragraph (c) to the proposed Sec. 585.410 in response to comments.
Existing Sec. Sec. 585.410 and 585.411 have been renumbered to
Sec. Sec. 585.411 and 585.412, respectively.
Sec. 585.410 When will my assignment result in a segregated lease?
BOEM's existing regulations authorized approval of requests to
segregate its leases into multiple smaller leases under Sec.
585.408(a), allowing lessees to ``assign all or part of your lease or
grant interest . . . subject to BOEM approval under this subpart.''
BOEM previously had approved lease segregations and continues to
anticipate receiving more requests as some lessees may decide to
develop their leases in a phased fashion. Accordingly, BOEM clarified
the process for segregating leases by adopting language from the lease
segregation provisions in its oil and gas regulations at 30 CFR
556.702. BOEM added that an ``application to assign a lease or grant
may include a request to modify the existing lease or grant period
schedule consistent with Sec. 585.235(d)'' in response to comments and
to ensure consistency with Sec. 585.235. BOEM has added a new
paragraph (c) to explain that when a lease becomes segregated, BOEM may
issue separate plan approval for a segregated lease or take other
actions within its discretion.
Please refer to the Other Proposed Changes in Part 585 section of
Section III above for additional discussion of the public comments
related to this section and BOEM's responses to those comments.
Sec. 585.411 How does an assignment affect the assignor's
liability?
This section has been re-numbered, as proposed, to reflect addition
of the Sec. 585.410 regarding lease segregation. No other changes were
made.
Sec. 585.412 How does an assignment affect the assignee's
liability?
This section is re-numbered, as proposed, to reflect the addition
of Sec. 585.410 regarding lease segregation. Also, because of the
Reorganization Rule, a new cross-reference to applicable BSEE
regulations at 30 CFR part 285, subpart I, was added to paragraph (a)
and a cross-reference to 30 CFR part 285 was added to paragraph (b).
This final rule corrects the extent of an assignee's regulatory
liability by replacing ``subchapter'' with ``part'' in the first
sentence of paragraph (b).
Sec. 585.413 How do I consolidate leases or grants?
BOEM added procedures in this section for consolidating two or more
adjacent leases or grants, as proposed. Under the existing regulations,
BOEM had the authority to approve lease consolidations by mutual
agreement under the terms of its existing leases (and has already done
so once), but no regulatory provision directly addressed such requests.
Section 585.413 codifies BOEM's existing practices in the regulations
by establishing a procedure for requesting and approving consolidations
of leases and grants.
BOEM notes that adjacent leases or grants may have different terms
and be at differing stages of development. BOEM has addressed such
differences as explained below. If the time remaining in the relevant
lease periods differs between the leases or grants to be consolidated,
BOEM will default to the shorter remaining periods in the new lease or
grant. Alternatively, the lessee or grantee may request a revised lease
period schedule pursuant to Sec. 585.235(d). If other terms and
conditions differ between the leases or grants to be consolidated, BOEM
will default to the most recently issued terms and conditions contained
in the leases or grants to be consolidated. The lessee or grantee may
request modifications to such terms and conditions. BOEM will consider
and, in its discretion, approve such requests on a case-by-case basis
for good cause. BOEM may assess the need to modify existing financial
assurances before approving a proposed consolidation. Any consolidated
leases or grants that has been consolidated into the new lease or grant
in their entirety will be considered terminated at the time of
consolidation approval. Please refer to the Other Proposed Changes in
Part 585 section of Section III above for additional discussion of the
public comments related to this section and BOEM's responses to those
comments.
Sec. 585.414 [Reserved]
Lease or Grant Suspension
Sec. 585.415 What is a lease or grant suspension?
As proposed, BOEM has changed the word ``term'' to ``period'' in
paragraphs (a) and (b) to correspond to the changes made to Sec.
585.235. This change did not alter the substance of these paragraphs. A
cross-reference to relevant BSEE regulations at 30 CFR 285.417 has also
been added in paragraph (a)(2), due to the Reorganization Rule.
Sec. 585.416 How do I request a lease or grant suspension?
As proposed, BOEM made several technical corrections and
clarifications to this section. First, BOEM reorganized the contents of
a suspension application for clarity and added a catch-all category to
provide BOEM with additional flexibility. Second, BOEM added a new
paragraph (b) consistent with its revisions to Sec. 585.235(b). A few
minor other changes have been made for editorial clarity.
[[Page 42695]]
Sec. 585.417 When may BOEM order a suspension?
Several provisions of this section were deleted because the
relevant provisions were moved to BSEE-administered regulations as part
of the Reorganization Rule. Therefore, the final rule retains only two
circumstances when BOEM may order a suspension, when necessary to
comply with judicial decrees or when the suspension is necessary for
reasons of national security or defense. Please refer to the Section-
by-Section Analysis Sec. 285.417 in Section V, which includes the
BSEE-administered regulations that were finalized consistent with the
proposed rule.
Sec. 585.418 How will BOEM issue a suspension?
No change was proposed or made to this section.
Sec. 585.419 What are my immediate responsibilities if I receive a
suspension order?
No change was proposed or made to this section.
Sec. 585.420 What effect does a suspension order have on my
payments?
BOEM made some technical edits to this section by combining
paragraphs (b) and (c) and modifying the requirement that directed
suspensions always be accompanied by a fee suspension, as proposed. As
a result, all payment suspensions will be at the discretion of BOEM.
BOEM also clarifies that, regardless of whether a lease or grant
suspension is approved or ordered, BOEM has discretion to ``waive or
defer'' (rather than ``suspend'') payments while the lease or grant is
suspended. BOEM believes that more flexibility is needed than its
existing regulations provide regarding its treatment of such payments,
given the wide range of potential justifications for a suspension.
Corresponding changes and clarifications were made to part 285 to
maintain consistency with these regulations and to provide the same
flexibility when either BSEE or BOEM orders a suspension, which may
occur as a result of the Reorganization Rule.
Sec. 585.421 How long will a lease or grant suspension be in
effect?
No change was made to this section other than the addition of a
clarifying edit that was made in the Reorganization Rule applying
suspensions to either leases or grants, such as RUEs and ROWs.
Sec. 585.422 When can my lease or grant be canceled?
This section was moved from Sec. 585.437 to Sec. 585.422 by the
Reorganization Rule. No other changes were proposed or made to this
section.
Sec. Sec. 585.423-585.424 [Reserved]
Lease or Grant Renewal
Sec. 585.425 May I obtain a renewal of my lease or grant before it
terminates?
BOEM proposed and made a technical change in this section in the
final rule to conform to its proposed changes to Sec. 585.235 by
changing the word ``term'' to ``period'' wherever it appears.
Sec. 585.426 When must I submit my request for renewal?
BOEM proposed and made a technical change in this section in the
final rule to conform to its proposed changes to Sec. 585.235 by
changing the word ``term'' to ``period'' wherever it appears.
Sec. 585.427 How long is a renewal?
BOEM proposed and made technical changes in this section in the
final rule to conform to its proposed changes to Sec. 585.235 by
changing the word ``term'' to ``period'' wherever it appears.
Sec. 585.428 What effect does applying for a renewal have on my
activities and payments?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.429 What criteria will BOEM consider in deciding whether
to renew a lease or grant?
BOEM proposed adding a new paragraph (g) to this section providing
for consideration of ``Other relevant factors, as appropriate'' in
determining whether to renew a lease or grant. BOEM's discretion to
consider relevant factors that may not be enumerated is particularly
important, given the difficulty of foreseeing what issues may arise in
the future when BOEM begins to receive lease renewal requests. BOEM
finalized this section as proposed. BOEM received no comments on this
section.
Sec. Sec. 585.430-585.431 [Reserved]
Lease or Grant Termination
Sec. 585.432 When Does My Lease or Grant Terminate?
BOEM proposed and made technical changes in subpart (a) of this
section in the final rule to conform to its proposed changes to Sec.
585.235 by changing the word ``term'' to ``period'' wherever it
appeared. BOEM also proposed and added ``in which case it terminates on
the date set forth in the notice of suspension or renewal'' to subpart
(a) of this section in the final rule. BOEM received no comments on
this section.
Sec. 585.433 What must I do after my lease or grant terminates?
The Reorganization Rule modified paragraph (a)(2) to include a
reference to the BSEE-administered regulations at 30 CFR 285.902. In
the final rule BOEM made an additional edit to reference Sec. Sec.
285.905 and 285.906 instead of Sec. 285.902 which more precisely
address decommissioning applications. No comments were received on this
section.
Sec. 585.434 When may BOEM authorize facilities to remain in place
following termination of a lease or grant?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Lease or Grant Relinquishment, Contraction, or Cancellation
As proposed, BOEM has consolidated the three undesignated sub
headers in the existing regulations into one, for clarity and
efficiency. The existing separate undesignated sub headers denoted
lease or grant relinquishment, lease or grant contraction, and lease or
grant cancellation.
Sec. 585.435 How can I relinquish a lease or a grant or parts of a
lease or grant?
As proposed, the final rule makes a lease or grant relinquishment
effective on the date BOEM receives a properly completed relinquishment
form, subject to the obligations listed in the existing rule. This
change would conform with BOEM's approach to oil and gas lease
relinquishments in 30 CFR 556.1101, under which a relinquishment takes
effect as soon as the lessee or grantee files with BOEM a properly
completed official relinquishment form available on BOEM's website.
Relinquishments will no longer require BOEM approval. As in the prior
regulations, relinquishment of a lease or grant would have no impact on
a lessee's or grant holder's obligations accrued under those
instruments before the relinquishment. The Reorganization Rule also
changed paragraph (a)(2) to reference ``to BSEE's satisfaction''
instead of BOEM due to the transfer of decommissioning regulations to
BSEE effectuated by the Reorganization Rule. After BOEM receives the
properly completed relinquishment form, ONRR will bill the lessee or
grantee the amount due on any outstanding obligations that accrued
under the relinquished lease or grant. No other changes were proposed
or made in the final rule. No comments were received on this section.
Sec. 585.436 Can BOEM require lease or grant contraction?
No changes were proposed or made to this section. No comments were
received on this section.
Sec. 585.437 When can my lease or grant be canceled?
This section was deleted and made reserved because the
Reorganization Rule moved this section to Sec. 585.422.
[[Page 42696]]
Sec. 585.438 What happens to leases or grants (or portions
thereof) that have been relinquished, contracted, or cancelled?
The existing regulations did not provide a process by which BOEM
could reissue a lease or grant for an area (or portions thereof)
previously covered by a lease or grant that has been relinquished under
Sec. 585.435, contracted under Sec. 585.436, or cancelled under Sec.
585.422. The final rule adds new Sec. 585.438, as proposed, to allow
BOEM to restart the competitive leasing process at any point it deems
reasonable after a lease or grant (or portion thereof) is relinquished,
contracted, or cancelled. In such situations, under this final rule,
BOEM would be obligated to engage in additional environmental analysis
and consultation, if necessary, due to elapsed time or changed
conditions. This final rule also allows, as proposed, BOEM to reoffer
the lease or grant to the next highest bidder if a competitively issued
lease or grant (or portion thereof) is relinquished or cancelled within
six months of the auction. BOEM believes that within six months, the
next best bid may still be deemed sufficient to constitute fair return
under 43 U.S.C. 1337(p)(2)(A). Minor grammatical edits were made to
ordering of cross references in paragraphs (a) and (b) in the final
rule. Please refer to the Lease Issuance Procedures section of Section
III above for additional discussion of the public comments related to
this section and BOEM's responses to those comments.
Sec. Sec. 585.439-585.499 [Reserved]
G. 30 CFR Part 585, Subpart F--Payments and Financial Assurance
Requirements
Subpart E, Payments and Financial Assurance Requirements, has been
redesignated as subpart F to accommodate the addition of a new subpart
B, as noted in Renewable Energy Leasing Schedule section of Section III
above.
Payments
Sec. 585.500 How do I make payments under this part?
This final rule adopts the changes to this section proposed in the
NPRM. First, it replaces the due date in paragraph (c)(1) for the bonus
balance payment on a competitively issued lease from ``[l]ease
issuance'' to ``[w]ithin 10 business days of receiving the unsigned
lease'' and adds a section reference. This final rule also replaces the
word ``issuance'' with ``execution'' in the ``Due date'' column of
paragraphs (c)(3) and (7). Also, in paragraph (c)(3), this final rule
changes the due date for payment of initial rent for a lease from ``45
days after lease issuance'' to ``within 45 calendar days after
receiving your copy of the executed lease from BOEM.'' These changes
are intended to provide clarity and to give a lessee or a grantee more
time to make the required payments.
This final rule also substitutes the word ``period'' for ``term''
in paragraphs (a) and (c) to ensure consistency with the changes to
Sec. 585.235. This final rule replaces the annual ROW rent of $70 per
mile with an annual rent of $5 per acre as determined by Sec.
585.301(a). This change provides BOEM with consistency in pricing OCS
usage for RUEs and ROWs. See further discussion on rent payment below
in the section-by-section analysis of Sec. 585.508.
BOEM did not receive any substantive comments on this section.
Sec. 585.501 What deposits must I submit for a competitively
issued lease, ROW grant, or RUE grant?
Existing Sec. 585.501 describes the deposit a bidder had to submit
to participate in specific types of auctions for a lease, RUE, or ROW.
As proposed, the final rule revises Sec. 585.501 to eliminate
provisions specifying deposits by auction type and instead provides
BOEM with the discretion to establish bid deposit requirements in the
FSN. This change is consistent with the provisions of Sec. 585.222(a).
No comments were received on this section.
Sec. 585.502 What initial payment requirements must I meet to
obtain a noncompetitive lease, ROW grant, or RUE grant?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.503 What are the rent and operating fee requirements for
a commercial lease?
As proposed, Sec. 585.503(a) revises the payment due date for the
first 12 months' rent on a commercial lease. The winning bidder is
required to pay the rent no later than 45 calendar days after receiving
a copy of the executed lease from BOEM in accordance with the
requirements provided in Sec. 585.500(c)(3). The existing regulations
provided that the rent payment is due no later than 45 calendar days
after BOEM sends the unsigned copies of the lease to the provisional
winner. This new section effectively would give lessees slightly more
time to pay the first 12 months' rent.
BOEM also made several technical corrections to this section to
conform to the definition of ``commercial operations'' in Sec. 585.113
and the establishment of the ``operations period'' under Sec.
585.235(4), as well as to provide more specificity regarding the
regulations that govern payments to ONRR.
No comments were received on this section.
Sec. 585.504 How are my payments affected if I develop my lease in
phases?
BOEM made a technical change, as proposed, to provide a more
specific citation to the regulations that govern payments to ONRR. In
addition, a technical change was made to citation Sec. 585.238 as a
result of the Reorganization Rule (88 FR 6376).
Sec. 585.505 What are the rent and operating fee requirements for
a limited lease?
BOEM finalized the technical changes proposed in the NPRM to
provide a more specific citation to the regulations that govern
payments to ONRR.
Sec. 585.506 What operating fees must I pay on a commercial lease?
BOEM finalized the changes proposed in the NPRM for this section.
BOEM amended the introductory paragraph to clarify that operating fees
are triggered at the start of commercial operations as defined in Sec.
585.113. Consistent with the existing regulations, generation of
electricity for commercial use, sale, transmission, or distribution
during testing is subject to operating fees. BOEM also amended
paragraph (c)(1) to remove ``generation of electricity'' and replace it
with ``operations'' consistent with the use of ``commercial
operations'' throughout the regulations. BOEM also amended paragraph
(c)(3)(i) to reflect the clear distinction between ``commercial
operations'' and the ``operations period'' under the final rule. After
the first year of the ``operations period'' is the appropriate point to
assess the capacity factor as opposed to the commencement of
``commercial operations'' which may occur during testing when limited
numbers of WTGs are producing power.
In addition to finalizing the proposed changes, BOEM also made
technical changes in the final rule to provide a more specific citation
to the regulations that govern payments to ONRR; to identify ONRR as
the correct payee for operating fees; and to define ``DOE.'' Finally,
BOEM eliminated paragraph (c)(4) to reduce the administrative
obligation of submitting duplicative gross annual generation figures.
As a result, paragraph (c)(5) has been redesignated as paragraph
(c)(4).
Please refer to the Lease Issuance Procedure and General Comments
and Response sections of Section III above for additional discussion of
the public
[[Page 42697]]
comments related to this section and BOEM's responses to those
comments.
Sec. 585.507 What rent payments must I pay on a project easement?
As proposed, BOEM made technical changes to provide a more specific
citation to the regulations that govern payments to ONRR and to conform
to the changes to Sec. 585.628(g).
In addition to finalizing the proposed changes, the final rule also
removed the word ``aerial'' before ``extent'' and replaced it with
``areal''. ``Areal extent'' is the term used in geography to describe
the size of a project easement area for an accessory platform. In
paragraph (b)(1), BOEM removed ``when the operations term begins'' such
that it refers only to Sec. 585.500, which provides that rent on a
project easement is due upon COP or GAP approval.
No comments were received on this section.
Sec. 585.508 What rent payments must I pay on ROW grants or RUE
grants associated with renewable energy projects?
BOEM finalized technical changes proposed in the NPRM to provide a
more specific citation to the regulations that govern payments to ONRR;
to remove the word ``nautical'' as redundant given the definition of
``miles'' in Sec. 585.113; and to make minor editorial adjustments
that enhance readability. BOEM simplified ROW rental payments to
reflect that, under this final rule, ROW corridors would have
sufficient width to accommodate all planned grant activities. BOEM
believes that most grantees would prefer an initially wider corridor
that would encompass all areas of actual seabed disturbance, rather
than the existing regulations, which limit corridors to a 200-foot
width with a subsequent determination of the ``affected area'' outside
that corridor. Grantees will be able to relinquish unused portions of
the right-of-way corridor after construction, as set forth in Sec.
585.301, and subsequently would be relieved of their obligation to pay
rent for the acreage within relinquished areas.
To promote consistency in BOEM's valuation of OCS rental pricing
across RUEs and ROWs, this final rule also replaces the annual ROW rent
of $70 per statute mile with a rent of the greater of $5 per acre per
year or $450 per year, as determined by Sec. 585.301(a), unless
otherwise specified in the grant. This change streamlines BOEM's
existing rental fee calculations and ensures a consistent valuation of
all OCS acreage for grants. Under the previous regulations, a ROW
grantee was required to pay an annual rent of about $2.89 per acre and
a RUE grant holder, $5 per acre.\27\ BOEM has since determined that no
compelling reason supports this differential between the RUE and ROW
annual rental rates. No substantive comments were received on this
section.
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\27\ An annual ROW rent of $2.89 per acre for a one-mile, 200-
foot-wide corridor is derived as follows: A 1-mile, 200-foot-wide
corridor has an area equivalent to 1,056,000 square feet or 24.24
acres (43,560 square feet per acre); $70 divided by 24.24 acres is
$2.89 per acre.
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Sec. 585.509 Who is responsible for submitting lease or grant
payments to ONRR?
As proposed, this final rule makes a technical correction to the
section heading by replacing ``BOEM'' with ``ONRR'' as the correct
payee.
Sec. 585.510 May BOEM defer, reduce, or waive my lease or grant
payments?
BOEM finalized the proposed regulations in the NPRM to allow BOEM
to grant requests for deferral of rental and operating fee payments, in
addition to reductions or waivers. BOEM seeks to avoid confusion by
explicitly including this authority in this final rule. BOEM also made
a technical change to conform the language to BOEM's changes to Sec.
585.235 (changed reference from ``term'' to ``period'').
Sec. Sec. 585.511-585.514 [Reserved]
Sec. 585.515 What financial assurance must I provide when I obtain
my commercial lease?
This section has been removed and reserved in this final rule, as
explained in the analysis of Sec. 585.516.
Financial Assurance Requirements for Commercial Leases
Sec. 585.516 What are the financial assurance requirements for
each stage of my commercial lease?
The following text, along with the comment descriptions in Risk
Management and Financial Assurance section of Section III, summarize
the changes that were proposed in the NPRM and that are implemented
with this final rule. This final rule amended several key aspects of
this section.
As discussed in Risk Management and Financial Assurance section of
Section III, BOEM has replaced the previous $100,000 lease-specific
bond required before BOEM will execute a commercial lease or approve an
assignment of an existing commercial lease with a bond or other
authorized financial assurance in the amount of 12 months' rent. This
will ensure that the lessee is not under-bonded during the preliminary
term of a lease if annual rent exceeds $100,000, which it often does.
BOEM removed the existing Sec. 585.515 as surplus in light of this
other change, as that section relates to a ``flat-fee'' bond that would
no longer be required. Section 585.515 previously subjected the minimum
base bond to adjustment every five years based on changes to the
Consumer Price Index-All Urban Consumers, but such adjustment is no
longer necessary if the initial bond amount is tied to the annual rent
for the lease. Under this final rule, Sec. 585.515 is reserved.
Second, BOEM amended the timing of the SAP decommissioning bond in
paragraph (a)(2) so that it is due before the installation of SAP
facilities, rather than at the time of SAP approval. This change was
made in recognition of the fact that liability for SAP facilities does
not accrue until installation.
Third, BOEM eliminated the bond or other financial assurance that
was previously due before COP approval, for the reasons set forth in
section Risk Management and Financial Assurance section of Section III
above.
Fourth, BOEM made several revisions to the decommissioning
financial assurance requirement. Most importantly, this final rule
establishes that a lessee may propose--and BOEM may approve or
disapprove--incremental funding of a financial assurance instrument
that satisfies this requirement. This would allow BOEM to approve the
incremental provision of financial assurance during the operation of
the facility for the reasons set forth in section Risk Management and
Financial Assurance section of Section III. This final rule provides
more flexibility than BOEM's existing regulatory authority, which
allows decommissioning financial assurance to be provided ``in
accordance with the number of facilities installed or being
installed.'' \28\
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\28\ 30 CFR 585.516(a)(3).
---------------------------------------------------------------------------
The remaining changes to this section are intended for
clarification and organizational purposes. For instance, BOEM has
adopted the term ``supplemental'' to describe all financial assurance
for obligations other than the first 12 months' rent. BOEM also has
removed language in paragraph (b) regarding a lessee's ability to
increase its financial assurance. The text was redundant of Sec.
585.517 requirements that a lessee provide financial assurance to cover
all lease obligations and that BOEM might require additional financial
assurance at any time during the lease after providing a lessee notice
and an opportunity to be heard. BOEM changed the timing for providing
supplemental financial assurance for marine hydrokinetic projects in
paragraph (c) in recognition that obtaining a FERC license, like the
approval of a COP, may not itself result
[[Page 42698]]
in the accrual of obligations. The additional flexibility regarding the
timing of financial assurance will assist BOEM in coordinating with
FERC.
Sec. 585.517 How will BOEM determine the amounts of the
supplemental financial assurance requirements associated with
commercial leases?
This final rule adopts the proposed changes in the NPRM and, in
addition, updates this section to reference the BSEE-administered
regulations at 30 CFR part 285, subpart I. The changes, as described in
the NPRM, are for clarity and do not have a substantive impact., and
BOEM did not receive any comments on this section.
Sec. Sec. 585.518-585.519 [Reserved]
Financial Assurance for Limited Leases, Row Grants and Rue Grants
Sec. 585.520 What financial assurance must I provide when I obtain
my limited lease, ROW grant, or RUE grant?
The final rule adopts the provisions of the proposed rule to make
technical changes and to provide that the lessee or assignee of a
limited lease, or a grantee or an assignee of a ROW or RUE grant, must
guarantee compliance with all terms and conditions of the lease or
grant by providing a bond or other authorized financial assurance in
the amount of 12 months' rent.
Please refer to section Risk Management and Financial Assurance
section of Section III for additional discussion of the public comments
related to this section and BOEM's responses to those comments.
Sec. 585.521 Do my financial assurance requirements change as
activities progress on my limited lease or grant?
The final rule implements the proposed changes to this section as
described in the NPRM and makes one technical correction. The estimated
cost of facility decommissioning is now specified to be ``as required
by 30 CFR part 285, subpart I,'' in reference to the BSEE-administered
regulations.
Please refer to section Risk Management and Financial Assurance
section of Section III for additional discussion of the public comments
related to this section and BOEM's responses to those comments.
Sec. Sec. 585.522-585.524 [Reserved]
Requirements for Financial Assurance Instruments
Sec. 585.525 What general requirements must a financial assurance
instrument meet?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.526 What instruments other than a surety bond may I use
to meet the financial assurance requirement?
BOEM is finalizing this section as proposed. This final rule makes
minor grammatical changes to paragraphs (a)(7)(i) and (a)(9). The
initial required expiration date was also changed from one year to not
less than 90 days in paragraph (a)(7)(iv). Letters of credit are often
valid for one year when they are granted from the bank, but if it takes
more than one day for submission, processing, and approval to ``become
effective'' then it is no longer valid for a full year. Changing the
one-year requirement to not less than 90 days will resolve this issue
and maintain consistency with paragraph (a)(7)(v), which provides that
BOEM needs to be notified if the letter of credit won't be valid for
more than 90 days.
Sec. 585.527 May I demonstrate financial strength and reliability
to meet the financial assurance requirement for lease or grant
activities?
BOEM requested comments on this section in the NPRM section V.G.3.e
``Other Financial Assurance Provisions.'' Please refer Risk Management
and Financial Assurance section of Section III for discussion of the
public comments related to this section and BOEM's responses to those
comments.
The existing regulations list the following criteria in making the
determination of financial strength and reliability: audited financial
statements, business stability, reliability, and compliance with
regulations. This rulemaking replaces those four criteria with two new
criteria: credit rating and the ratio of projected revenue to
decommissioning liability. This rulemaking also sets the acceptable
threshold(s) for credit ratings, as described in more detail above in
Risk Management and Financial Assurance section of Section III.
Paragraph (a) allows a credit rating from an NRSRO and paragraph
(b) allows a proxy credit rating determined by BOEM. Co-lessee or co-
grant-holder financial strength is used to determine financial strength
and reliability in paragraph (c). The minimum threshold for adequate
financial strength in paragraphs (a), (b), and (c) is an investment
grade credit rating, either BBB- from Standard and Poor's (S&P), Baa3
from Moody's, or an equivalent rating from another NRSRO.
Paragraph (d) describes how, for a lessee without an investment
grade credit rating, BOEM may consider the contracted revenue from
electricity generation relative to its operating expenses (net income)
and the decommissioning obligations associated with that generation.
Contracted revenue could include revenue from a power purchase
agreement, renewable energy production credit, or other arrangement
with a counterparty. For a lessee, if its net income is at least three
times its estimated decommissioning expenses associated with the
facilities that will generate that income, BOEM could use the
contract(s) to determine the lessee's financial strength and
reliability.
Existing paragraphs (b) and (c) were redesignated as paragraphs (e)
and (f) and were modified to reflect the new financial strength and
reliability assessments. The submission deadline of March 31 was
removed in paragraph (e) to accommodate lessees that do not report
annual financial information as of December 31st. Lessees will still be
required to submit annual financial statements, but the submission
timeline will depend on the fiscal year of each lessee. Revised
paragraph (f) removes the reference to information required by the
existing paragraph (a) because those criteria, audited financial
statements, business stability, reliability, and compliance, will no
longer be used in BOEM's evaluations.
Sec. 585.528 May I use a third-party guaranty to meet the
financial assurance requirement for lease or grant activities?
BOEM requested comments on this section in the NPRM section V.G.3.e
``Other Financial Assurance Provisions.'' Please refer to the Risk
Management and Financial Assurance section of Section III for
discussion of the public comments related to this section and BOEM's
responses to those comments.
The final rule in paragraph (a)(1) of this section requires that a
guarantor meet the credit rating criteria in Sec. 585.527(a) for
financial strength and reliability, as described in more detail in Risk
Management and Financial Assurance section of Section III. Other
financial assurance provisions--credit ratings and modifies paragraph
(a)(2) for clarity. BOEM revised paragraph (b) to allow a third-party
guaranty to be limited to a fixed dollar amount. Paragraph (c) was
added to specify what occurs if a guarantor no longer meets the
criteria in paragraph (a)(1). Paragraph (d)(5) was removed as it was
identical in purpose to (d)(3) and the subsequent paragraphs in (d)
were renumbered to reflect this change. The remaining paragraphs in
this section were modified to update references that changed due to the
Reorganization Rule. The reference to ``operating rights owner'' in
paragraph (d)(4) was also
[[Page 42699]]
removed since that is a legal status that exists in the offshore oil
and gas regulatory framework but not in the legal framework for OCS
renewable energy leases.
Sec. 585.529 Can I use a lease- or grant-specific decommissioning
account to meet the financial assurance requirements related to
decommissioning?
In this final rule, BOEM updated paragraphs (a)(2) through (4) by:
(1) Clarifying that the lessee must fund the account in the amount
determined by and according to the payment schedule approved by BOEM;
(2) Adding a note to the effect that BOEM will estimate the cost of
decommissioning, including site clearance; (3) Adding a provision that,
subject to BOEM's approval, a decommissioning account may be funded in
whole or in part during the operations period of a lease or grant; and
(4) Noting that BOEM may modify an approved payment schedule if it
determines such a modification to be justified by a material change in
circumstances. These changes are also discussed in more detail in Risk
Management and Financial Assurance section of Section III. The final
rule also inserts a semi-colon at the end of paragraph (a)(1) that was
inadvertently removed in the NPRM.
Changes in Financial Assurance
Sec. 585.530 What must I do if my financial assurance lapses?
The final rule makes minor corrections, as proposed, to the
existing regulations by adding ``your'' before third-party guarantor
and removing the subsequent comma.
Sec. 585.531 What happens if the value of my financial assurance
is reduced?
No changes were proposed for this section. This final rule adds no
additional changes. BOEM received no comments on this section.
Sec. 585.532 What happens if my surety wants to terminate the
period of liability of my financial assurance?
BOEM did not receive any comments on this section and is finalizing
the section as proposed. The word ``bond'' was replaced by the term
``financial assurance,'' consistent with the same change made
throughout the BOEM-administered regulations. Also, a surety must now
submit a request to terminate the period of liability 90 days before
the proposed termination date.
Sec. 585.533 How does my surety obtain cancellation of my
financial assurance?
BOEM did not receive any comments on this section. Paragraphs (c)
and (d) will be combined to better state that financial assurance may
not be cancelled after 7 years if there are any associated appeals or
litigation; the remainder of the section is finalized as proposed. The
term ``cancel'' is now used throughout this section for consistency
instead of ``release.'' The ``only if'' conditional was replaced with a
timing clause stating when cancellation would occur.
Sec. 585.534 When may BOEM cancel my financial assurance?
BOEM did not receive any comments on this section and is finalizing
the section as proposed. The first column of the chart now lists the
different types of financial assurance, and the second column lists the
cancellation requirements. The cancellation requirements have been
expanded to include several new situations. Also, a clause was added to
allow reinstatement of financial assurance in certain situations.
Sec. 585.535 Why might BOEM call for forfeiture of my financial
assurance?
BOEM did not receive any comments on this section and is finalizing
the section as proposed. The term ``bond'' is replaced with ``financial
assurance.''
Sec. 585.536 How will I be notified of a call for forfeiture?
No changes were proposed for this section and no changes were made
to this section in this final rule.
Sec. 585.537 How will BOEM proceed once my bond or other security
is forfeited?
No changes were proposed for this section and no changes were made
to this section in this final rule.
Sec. Sec. 585.538-585.539 [Reserved]
Revenue Sharing With States
Sec. 585.540 How will BOEM equitably distribute revenues to
States?
As proposed, this final rule changes this section to update the
cross-reference to the ``Definitions'' section of the rule from Sec.
585.112 to Sec. 585.113, corresponding to the renumbering of the
sections that is being implemented with this final rule.
Sec. 585.541 What is a qualified project for revenue sharing
purposes?
As proposed, the final rule makes a technical correction to this
section to remove the word ``nautical'' as redundant given the
definition of ``miles'' in Sec. 585.113, which defines ``miles'' to
mean nautical miles.
Sec. 585.542 What makes a State eligible for payment of revenues?
As proposed, the final rule makes a technical correction to this
section to remove the word ``nautical'' as redundant given the
definition of ``miles'' in Sec. 585.113, which defines ``miles'' to
mean nautical miles.
Sec. 585.543 Example of how the inverse distance formula works.
No changes were proposed for this section and no changes were made
to this section in this final rule.
Sec. Sec. 585.544-585.599 [Reserved]
H. 30 CFR Part 585, subpart G--Plans and Information Requirements
Subpart F, Plans and Information Requirements, has being
redesignated as subpart G to accommodate the addition of a new subpart
B, as noted in Renewable Energy Leasing Schedule section of Section III
above.
Sec. 585.600 What plans must I submit to BOEM before I conduct
activities on my lease or grant?
The existing regulations required lessees to submit a SAP for BOEM
approval before conducting any site assessment activities on their
commercial leases. Consistent with the proposed rule, under this final
rule, in Sec. 585.600(a)(1), SAPs are required only for site
assessment activities involving met towers or other facilities that are
installed on the seabed using a fixed-bottom foundation requiring
professional engineering design and assessment of sediment,
meteorological, and oceanographic conditions as part of the design.
This change is intended to exempt floating site assessment facilities,
such as met buoys, from the SAP requirement, and is being implemented
for the reasons set forth in Site Assessment Facilities section of
Section III. The changes to these regulatory provisions will not affect
the applicability of other agencies' statutory and regulatory
requirements.
Under the final rule a lessee planning to install an industry-
standard met buoy using a gravity anchor for site assessment will no
longer be required to submit a SAP. If a lessee is uncertain whether
its proposed site assessment facility would have the type of foundation
that could trigger the SAP requirements, the lessee should consult with
BOEM.
A commenter recommended deleting ``engineered foundation'' from the
definitions in proposed Sec. 585.113 as well as eliminating a
reference to it which was included in proposed Sec. 585.600(a)(1) to
``avoid confusion, given that it only applies to met towers and no
other structures.'' BOEM agrees with this approach given that the term
``engineered foundation'' was only intended to be used in the SAP
provisions of the rule and elected not to include this term in either
the definitions nor in Sec. 585.600(a)(1) in the final rule. BOEM
determined the reference to an ``engineered foundation'' in proposed
Sec. 585.600(a)(1) was redundant with the proposed inclusion of
``fixed-bottom foundation requiring
[[Page 42700]]
professional engineering design and assessment of sediment,
meteorological, and oceanographic conditions as part of the design.''
Therefore, BOEM determined the use of ``engineered foundation'' was
unnecessary while leaving the latter language intact in the final rule.
These comments and revisions are also discussed in the preamble in Site
Assessment Facilities section of Section III.
As proposed, the final rule adds language to paragraph (b) to
recognize BOEM's discretion to waive certain information or analysis
requirements in a proposed plan if the applicant can demonstrate that,
among other things, the information or analysis is known to BOEM, the
relevant resource is not present or affected, or the information is not
needed or required by a State's coastal management program. The
language in this provision, modeled on BOEM's oil and gas regulations
at 30 CFR 550.201(c), would grant BOEM more flexibility to tailor its
plan requirements to unique elements of a specific proposal without
needing to issue regulatory departures under Sec. 585.103.
Sec. 585.601 When must I submit my plans to BOEM?
The existing regulations required the submittal of a SAP no later
than 12 months after the date of lease or grant issuance. BOEM saw no
persuasive reason for this requirement in Sec. 585.601(a) and removed
it in this final rule as proposed. In doing so, BOEM will provide
useful flexibility to lessees and grantees without any notable
downside. Some lessees have chosen to file a COP prior to a SAP, and
there may be other instances where additional data collection methods
that would require a SAP are undertaken after the filing of the COP.
BOEM expects that the requirement will have little application given
that SAPs are no longer required for met buoys, because nearly all SAPs
submitted to date have been for met buoys. Moreover, removing this
deadline is consistent with the overhaul of lease periods that BOEM is
finalizing in this rule at Sec. 585.235, which includes elimination of
the ``site assessment term'' by consolidating it into the ``preliminary
period.'' With this final rule, BOEM will allow a lessee or grantee to
submit a SAP anytime during the term of its lease or grant but will
continue to require a lessee or grantee to submit a SAP before
conducting any activities that require a SAP.
In the final rule Sec. 585.601(b) and (c), BOEM revised the timing
for COP submittal to be more consistent with the changes to the lease
periods in Sec. 585.235. Under this final rule, a COP is due by the
end of the preliminary period. In this final rule, BOEM clarifies that
a GAP is due by the end of the preliminary period for a limited lease,
or a preliminary period for a grant consistent with Sec. Sec. 585.236
and 585.303, respectively. Because lessees and grantees may request
lease and grant period extensions, BOEM eliminated the specific timing
from each of these provisions. The remaining changes to this section in
the final rule are edits for clarity.
No comments were received on this section.
Sec. 585.602 What records must I maintain?
This section was moved to part 285 under BSEE by the Reorganization
Rule and retained as reserved in the BOEM-administered regulations in
part 585.
Sec. Sec. 585.603-585.604 [Reserved]
Site Assessment Plan and Information Requirements for Commercial Leases
Sec. 585.605 What is a Site Assessment Plan (SAP)?
As proposed, BOEM is revising Sec. 585.605(a) in this final rule
to be consistent with its changes to Sec. 585.600(a)(1) and is
deleting text that it views as duplicative of the requirements set
forth in Sec. Sec. 585.606 through 585.613 (describing the SAP
submittal and review process). The remaining changes to the
redesignated paragraphs (b) and (c) in this final rule are editorial in
nature and intended only to clarify the existing text. In addition, the
citation to Sec. 585.810 is replaced with Sec. 285.810 as a result of
the Reorganization Rule (88 FR 6376). No comments were received on this
section.
Sec. 585.606 What must I demonstrate in my SAP?
As proposed, in this final rule, BOEM removed paragraph (b) of this
section to discontinue the requirement for a lessee to ``demonstrate
that your site assessment activities will collect the necessary
information and data required for your COP, as provided in Sec.
585.626(a).'' BOEM has determined that this requirement is unnecessary
because it is not BOEM's responsibility to ascertain at this stage if
site assessment data will be sufficient to meet the needs of the COP
review; rather, BOEM intends to focus its review on the potential
environmental impacts of the site assessment facility itself. Other
edits in this section are technical corrections or are intended to
further clarify the text.
Please refer to Section III for a discussion of comments received
on this section.
Sec. 585.607 How do I submit my SAP?
This final rule eliminates the paper copy requirement SAP
submission, as proposed, consistent with revised provisions in Sec.
585.111. BOEM received no comments on this provision.
Sec. Sec. 585.608-585.609 [Reserved]
Contents of the Site Assessment Plan
Sec. 585.610 What must I include in my SAP?
BOEM is clarifying and streamlining the data requirements for SAP
submission. Most of these changes are driven by changes to the COP
requirements (as discussed in Geophysical and Geotechnical Surveys
section of Section III above). BOEM is making similar changes across
the corresponding SAP and GAP regulations for purposes of consistency.
A more detailed description of the rationale for these proposed
revisions can be found in Geophysical and Geotechnical Surveys section
of Section III, and the analysis of proposed Sec. 585.626 found in the
NPRM. Some changes made to this section are also discussed in the
Project Design Envelope section of Section III above. The following
summarizes the key changes to this section being finalized, as
proposed:
First, this final rule adds language in paragraph (a) intended to
clarify that a lessee may use a PDE in its SAP as discussed in the
Project Design Envelope section of Section III above. The introductory
language in paragraph (a) \29\ clarifies that project specific
information may be provided as a range of parameters. While BOEM is not
specifying in this rule what that range should be, BOEM's requirement
cannot be met without providing both a minimum and a maximum value. For
example, a lessee could propose two types of met tower foundations in
its SAP but would need to describe which foundation type is expected to
have the greatest impact on each affected resource. Paragraph (a)(5)
includes language clarifying that a lessee can propose a range of
potential locations for its site assessment facility as well as an
indicative layout (i.e., a less detailed design) as an alternative to a
location plat. BOEM made additional edits to paragraph (a)(6) to
clarify that only preliminary design information is required for
facilities that are deemed complex and significant, while final design
information is needed for
[[Page 42701]]
facilities that are not deemed complex and significant. Final designs
would be submitted with the FDR under 30 CFR 285.701 if the project is
deemed complex and significant under Sec. 585.613(a).
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\29\ For clarity, BOEM proposes standardizing the presentation
of the required content for an SAP, COP, and GAP so that paragraph
(a) outlines the general informational requirements and paragraph
(b) outlines the survey and investigations data requirements. The
equivalent COP and GAP sections would be re-arranged under this
final rule consistent with this approach.
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Second, BOEM is eliminating the existing requirement in paragraph
(a)(9) that a CVA nomination (if necessary, under Sec. 585.613(a))
must be included with the SAP; instead, a lessee will nominate a CVA
before or after SAP submittal under 30 CFR 285.706. As described
further in Certified Verification Agent and Engineering Report section
of Section III above, the intent of decoupling the CVA nomination from
the SAP, COP, or GAP is to allow a lessee or grantee to obtain the
benefits of CVA review at the earliest feasible opportunity. In lieu of
a CVA nomination, a lessee will only need to describe its project
verification strategy for those proposed activities that would require
an SAP. For an SAP, this would include an analysis of whether the
project should be considered complex or significant, thereby triggering
the design, fabrication, and installation requirements in 30 CFR part
285, subpart G. Under this final rule, if BOEM determines that the
project is complex or significant, the lessee or grantee would be
required to include a general description of its strategy for complying
with the requirements of 30 CFR part 285, subpart G.
Third, BOEM is adopting various clarifying and technical edits to
several other informational requirements in paragraph (a), including
adopting language from the existing COP informational requirements
(Sec. 585.626) regarding decommissioning; documents incorporated by
reference; and lists of Federal, State, and local permits.
Fourth, this final rule revises the SAP data requirements in
paragraph (b) to mirror the changes to the COP and GAP regulations. The
reasons for these changes are described in more detail in Geophysical
and Geotechnical Surveys section of Section III above and in the
description of revised Sec. 585.626(b). Note that the detail and
thoroughness of these data requirements would be commensurate with the
scope and complexity of the proposed activities. Under Sec.
585.600(b), lessees could seek waivers of certain data requirements by
providing their rationale for why that data is unnecessary.
Finally, as proposed, BOEM is deleting the existing paragraph (c),
which concerned the simultaneous submittal of an SAP and either a COP
or (for a marine hydrokinetic project) a FERC license application. BOEM
believes that paragraph (c) is unnecessary because such simultaneous
submittals still would be permitted under other provisions of this
subpart in this final rule and because much of this paragraph is
repetitive of Sec. 585.601(b).
Sec. 585.611 What information and certifications must I submit
with my SAP to assist BOEM in complying with NEPA and other applicable
laws?
BOEM is adopting clarifications to the following informational
requirements in this section that were proposed in the NPRM. These
proposed clarifications are consistent with BOEM's present expectations
for SAP submittals and, therefore, should not create additional burdens
on lessees:
Information about resources, conditions, and activities
that your proposed activities may significantly affect or that may have
a significant effect on your proposed activities (including where the
potential significance of the effect is unknown) and must contain any
other information required by law. This edit is consistent with
comments made and incorporated into the COP regulations at Sec.
585.627(a) and is, consistent with NEPA, as amended by the Fiscal
Responsibility Act in 2023.
Water quality information would explicitly include impacts
from vessel discharges, as is already required under the CWA.
Archaeological resources information would explicitly
include information on all types of historic properties, as is already
required under the NHPA.
Coastal and marine uses information would explicitly
include assessments of fisheries and navigational safety risk. Lessees
would be required to submit the latter assessment to the USCG.
Additionally, in the section heading and regulatory text, the more
appropriate phrase ``applicable laws'' would replace ``relevant laws.''
The remaining changes to this section include edits for improved
organization, clarity, or consistency, including moving most of the
language from the existing paragraph (b) into a new paragraph (c).
See Section III for a discussion of a comment received on this
section.
Sec. 585.612 How will my SAP be processed for Federal consistency
under the Coastal Zone Management Act?
BOEM is modifying paragraph (a) to add that the submittal to BOEM
must conform with the requirements of Sec. 585.111. BOEM is clarifying
in paragraph (b) that lessees need to submit a consistency
certification for their SAPs under 15 CFR part 930, subpart E, only if
BOEM has not previously submitted a consistency determination to that
State under 15 CFR part 930, subpart C, that covered the proposed site
assessment activities, as opposed to always providing the submittal as
described in the previous version of the regulations. The existing
regulations require lessees to submit a consistency certification in
all cases.
BOEM, in consultation with NOAA, finds that implementation of the
OCS renewable energy program thus far shows that there are three
potential CZMA Federal consistency reviews \30\ related to BOEM's
actions: (1) when BOEM conducts a lease sale and awards a lease, ROW,
or RUE and provides a state or states with a CZMA consistency
determination under 15 CFR part 930, subpart C; (2) when an applicant
submits a CZMA consistency certification to BOEM for a SAP, COP, or
GAP, if required by 15 CFR part 930, subpart E; and (3) when the
activity is located outside a geographic location described in the
state's coastal management program pursuant to 15 CFR 930.52, and an
applicant, on its own accord, submits a consistency certification to a
state or states through BOEM under 15 CFR part 930, subpart E. For the
lease sales held so far, states have reviewed associated SAP activities
through the review of BOEM's consistency determination under 15 CFR
part 930, subpart C. BOEM and NOAA expect that this will continue and
that it should be the rare case where a separate CZMA consistency
review is required for an SAP or GAP. BOEM is making clarifying edits
to this section in the final rule by noting that necessary data and
information ``required to conduct an adequate consistency review'' will
be provided along with BOEM's consistency certification.
---------------------------------------------------------------------------
\30\ This section does not include a hypothetical fourth
situation where a non-lessee submits a lease application and COP to
BOEM simultaneously. While permitted by BOEM's regulations, this
situation is not expected to arise in practice.
---------------------------------------------------------------------------
See Section III for a discussion of the comments received on this
section. The changes described here are as proposed.
Sec. 585.613 How will BOEM process my SAP?
In this final rule, BOEM is removing ``modification'' and replacing
it with ``conditions'' to be consistent with other changes to plan
approvals, as was proposed. BOEM also is harmonizing the existing
language in paragraph (e)(2) of this section with an equivalent
provision in Sec. 585.628(f)(2) regarding actions lessees may take in
the event of SAP disapproval. BOEM is also clarifying that SAP
resubmission must occur within a reasonable time and
[[Page 42702]]
proposes to make analogous changes to the equivalent COP and GAP
requirements in Sec. Sec. 585.628 and 585.648. Other edits to this
section are editorial in nature and intended only to clarify the
existing text. See Section III for a discussion of the comments
received on this section. The changes described here are as proposed.
Activities Under an Approved Sap
Sec. 585.614 When may I begin conducting activities under my
approved SAP?
BOEM has made a minor edit to paragraph (b), as proposed, by adding
the word ``description'' after Safety Management System (SMS) to
clarify that it is a description of the Safety Management System that
must be submitted, in conformance with the requirements in 30 CFR
285.810. In addition, the citation to Sec. 585.810 is replaced with 30
CFR 285.810 as a result of the Reorganization Rule (88 FR 6376).
Sec. 585.615 What other reports or notices must I submit to BOEM
under my approved SAP?
To be consistent with the Reorganization Rule (88 FR 6376), in the
final rule, BOEM deleted the existing dual requirements of informing
BOEM within 30 days of completing the installation of facilities in an
approved SAP and the certification of annual compliance with the terms
of the SAP. The only remaining requirement is that the lessee must
prepare and submit to BOEM a report annually on November 1 of each year
that summarizes the site assessment activities and the results of those
activities. BOEM will continue to withhold trade secrets and commercial
or financial information that is privileged or confidential from public
disclosure under exemption 4 of the Freedom of Information (FOIA) and
as provided in Sec. 585.114 (formerly Sec. 585.113). No comments were
received on this section.
Sec. 585.616 [Reserved]
Sec. 585.617 What activities require a revision to my SAP, and
when will BOEM approve the revision?
As proposed, this final rule makes revisions to this section. BOEM
is revising paragraph (a) consistent with changes BOEM made to Sec.
585.600(a)(1), which limits the applicability of SAPs to facilities
that are installed on the seabed using a fixed-bottom foundation
requiring professional engineering design and assessment of sediment,
meteorological, and oceanographic conditions as part of the design. The
changes to this section include the addition of a new paragraph (b) to
clarify that revisions to a lessee's SAP may trigger a reassessment of
the significance and complexity of the facility or facilities described
in the revised SAP. This final rule also revises paragraph (d) to
eliminate unnecessary verbiage in the list of changes or modifications
that could trigger the revision of an approved SAP by merging the
substance of existing paragraphs (c)(4), (5), and (6) into revised
paragraphs (d)(2) and (3). In the final rule, BOEM made additional
edits in response to comments to further clarify the scope of paragraph
(d), by specifying that OCS activities that could have significant
environmental impacts, or that may affect threatened or endangered
species, or that may affect designated critical habitat of such
species, or that may result in incidental take of marine mammals, may
trigger revisions. BOEM is also aligning this section with the PDE
concept as described Project Design Envelope section of Section III
above, to ensure consistency with the Sec. 585.610(a)(5). This final
rule makes minor additional editorial changes to improve clarity and
readability. See Section III for a discussion of the comments received
on this section.
Sec. 585.618 What must I do upon completion of approved site
assessment activities?
This final rule adopts the technical edits proposed in paragraph
(a) to ensure consistency with changes to Sec. 585.235, which
eliminated the site assessment term of a commercial lease. Paragraph
(a) applies only if site assessment facilities are installed before COP
submittal.
Paragraph (e) of the existing regulation states that ``you must
initiate the decommissioning process [for your site assessment
activities] . . . upon termination of your lease.'' However, BSEE's
regulations in 30 CFR part 285, subpart I, require lessees to initiate
the decommissioning process by submitting a decommissioning application
as much as two years before the lease expires. BOEM is adopting the
changes proposed to this section in the NPRM for clarity and
consistency with Sec. Sec. 285.905 and 285.906. BOEM received no
comments on these revisions.
Sec. 585.619 [Reserved]
Construction and Operations Plan for Commercial Leases
Sec. 585.620 What is a Construction and Operations Plan (COP)?
As a result of the Reorganization Rule (88 FR 6376), BOEM is
replacing the cross reference to Sec. 585.113 with Sec. 585.114 in
this final rule. No other changes were made to this section.
Sec. 585.621 What must I demonstrate in my COP?
As proposed, this final rule makes technical edits to this section
to ensure consistency with changes to Sec. 585.606 for SAPs discussed
above.
Sec. 585.622 How do I submit my COP?
This final rule eliminates the paper copy requirement for COP
submission, as proposed, consistent with the revised provisions in
Sec. 585.111.
Sec. Sec. 585.623-585.625 [Reserved]
Contents of the Construction and Operations Plan
Sec. 585.626 What must I include in my COP?
BOEM is clarifying and streamlining the data requirements for COP
submission in several key respects.
First, this final rule adds language in paragraph (a) clarifying
that a lessee may use a PDE in its COP, as further discussed above in
sections Project Design Envelope, Geophysical and Geotechnical Surveys
of Section III, and the analysis of Sec. 585.610.
Second, BOEM is replacing the existing obligation in paragraph
(a)(18) to submit a CVA nomination with the COP with a requirement to
submit a ``project verification strategy'' describing the lessee's plan
for complying with BSEE's regulations at 30 CFR 285.705 through
285.714. As discussed further in Certified Verification Agent and
Engineering Report section of Section III, this amendment provides
lessees with the flexibility to nominate (and for BSEE to approve) a
CVA either before or after COP submittal.
Third, this final rule makes both clarifying and substantive
changes to the data submittal requirements in this section. Most of the
proposed changes relate to nomenclature and organization and are
intended to more precisely reflect BOEM's expectations for a lessee's
COP surveys. For instance, BOEM is merging the ``shallow hazards,''
``geological,'' ``geotechnical,'' and ``site investigation'' survey
requirements in paragraphs (a)(1), (2), (4), and (6) into ``geological
and geotechnical'' survey requirements set forth in a new Sec.
585.626(b)(1). BOEM believes this change clarifies the intent of the
regulations, minimizes any stakeholder confusion and will reduce
redundancy. The shallow hazards survey is part of both geological and
geotechnical surveys (and thus does not actually constitute an
independent survey), geological and geotechnical surveys have
overlapping purposes, and the ``site investigation'' is effectively an
amalgam of the above-described surveys.
[[Page 42703]]
The geological and geophysical survey provisions in Sec.
585.626(b)(1) are replacing the prescriptive requirements with
performance-based standards focused on the sufficiency of information
regarding geological site conditions that BOEM needs in order to
adequately review a COP. In particular, BOEM is eliminating the
requirements in existing Sec. 585.626(a)(1) regarding shallow hazard
surveys as well as the requirements in existing Sec. 585.626(a)(4)
that lessees submit ``[t]he results of adequate in situ testing,
boring, and sampling at each foundation location'' and ``[t]he results
of a minimum of one deep boring (with soil sampling and testing) at
each edge of the project area.'' Instead, BOEM will require geological
and geotechnical data sufficient to ``define the baseline geological
conditions of the seabed and provide sufficient data to develop a
geologic model, assess geologic hazards, and determine the feasibility
of the proposed site for your proposed facility.''
BOEM believes that these new standards will provide it with
flexibility to tailor its data requirements to site- and project-
specific conditions without needing to issue regulatory departures
under Sec. 585.103. To ensure BOEM will continue to have sufficient
information to conduct an environmental analysis and the necessary
interagency consultations, BOEM will continue performing a sufficiency
review after receipt of a COP and notifying the lessee of any
additional outstanding information requirements prior to completing the
COP review. More importantly, the deferral of the in situ boring
requirement will address the concerns raised by lessees and described
in detail in Geophysical and Geotechnical Surveys section of Section
III. This final rule will not reduce the quality of geotechnical data
that BOEM will review before the start of construction. Geophysical
surveys will still need to identify all relevant shallow hazards, and
the results of certain detailed geotechnical surveys to inform
engineering decisions, which will include data from in situ
explorations, would now need to be submitted with the FDR as set forth
in BSEE's regulations in 30 CFR 285.701.
With this final rule, BOEM decided not to allow a lessee to submit
the results of certain detailed subsea archaeological surveys with the
FDR. BOEM reasoned that sufficient geophysical data is necessary to
assess potential impacts from offshore wind activities on cultural
resources and the introduction of a case-by-case deferral of certain
marine archaeological surveys creates uncertainty for all parties
participating in consultations conducted according to Section 106 of
the NHPA. As in its changes to Sec. 585.610, BOEM is also clarifying
that required reports under paragraph (b)(3) of this section include
information on all historic properties listed or eligible for listing
on the National Register of Historic Places in accordance with the NHPA
and its implementing regulations.
This final rule also adds paragraph (b)(4) to this section to
clarify BOEM's need for desktop data on oceanographic and
meteorological conditions sufficient to ``support preliminary design of
the facility and support the analysis of wake effects, sediment
mobility and scour, and navigational risks.'' Existing Sec.
585.627(a)(1) requires the submittal of similar data on conditions that
could create hazards for a project. BOEM believes obtaining more
comprehensive meteorological and oceanographic information to better
inform modeling, design, and environmental reviews is necessary and
appropriate. BOEM has made only clarifying edits to the biological
survey requirements in this section. BOEM also is making analogous
changes, where appropriate, in the equivalent regulations for SAPs and
GAPs in Sec. 585.610 and Sec. 585.645, respectively.
The remaining changes to this paragraph are edits for organization
and clarity.
Sec. 585.627 What information and certifications must I submit
with my COP to assist BOEM in complying with NEPA and other applicable
laws?
In this final rule, BOEM clarified the informational requirements
in paragraph (a) as proposed in the NPRM. Additional edits were made
consistent with the changes made to Sec. 585.611(a) for SAPs and to be
consistent with NEPA as amended in 2023. BOEM also clarified the
consistency certification requirements in paragraph (b)(1) by revising
the language to provide that the applicant must certify that the
proposed activities described in detail in the applicant's plan comply
with ``the enforceable policies of the applicable States' approved
coastal management programs (as opposed to ``the State(s) approved
coastal management program(s)'') and will be conducted in a manner that
is consistent with such programs.'' This change limits BOEM's interest
to the enforceable policies of the applicable States' programs, not all
States' approved coastal management programs.
BOEM also made a technical correction to paragraph (c). That
provision required a lessee to submit an OSRP with its COP ``as
required by 30 CFR part 254.'' Because the cross-referenced regulations
apply only to OCS oil and gas activities, BOEM is instead requiring
that a lessee submit an OSRP ``in compliance with 33 U.S.C. 1321,
including information identified in 30 CFR part 254 that is applicable
to your activities.'' This statutory provision is not limited to oil
and gas activities, and grants BOEM and its lessees more flexibility to
craft OSRPs that are commensurate with the estimated worst-case
discharge from a renewable energy facility. The regulation clarifies
that the OSRP must include information identified in 30 CFR part 254
that is applicable to the lessee's activities.
BOEM did not add language that a Tribal commenter requested to be
added to BOEM's required information in SAPs, COPs, and GAPs. The
revised language would have required lessees to submit information
about ``culturally significant sites, including viewsheds and
traditional cultural landscapes and properties, and subsistence rights
of a federally recognized Tribe.'' Such information is already required
to be included in plans through requirements to submit ``detailed
information and analysis to assist BOEM in complying with NEPA and
other applicable laws,'' including information about ``archaeological
resources use, or historic property use, Indigenous traditional
cultural use, or use pertaining to treaty and reserved rights with
Native Americans or other Indigenous peoples, including required
information to conduct review of the [plan] under the NHPA or other
applicable laws or policies, including treaty and reserved rights with
Native Americans or other Indigenous peoples.'' Although the specific
language requested was not added to the regulations, BOEM will ensure
that the priorities identified in the comment are conveyed to the
reviewers of plans to ensure these requirements are met.
Additionally, in the section heading and regulatory text, the more
appropriate phrase ``applicable laws'' replaces ``relevant laws.'' This
final rule is eliminating the paper copy requirement, consistent with
revised Sec. 585.111 and makes minor additional editorial changes to
improve clarity and readability.
See Section III for a discussion of the comments on this section
and BOEM's response to those comments.
Sec. 585.628 How will BOEM process my COP?
In this final rule, BOEM is adopting the new proposed provisions of
paragraph (c) stating that, after all information requirements for the
COP are met and after the appropriate
[[Page 42704]]
environmental assessment or draft environmental impact statement, if
required, has been published, the lessee or grantee will be required to
submit its COP, consistency certification, and associated data and
information under 15 CFR part 930, subpart E, to the applicable State
CZMA agencies to BOEM after all information requirements for the COP
are met, and the appropriate environmental assessment or draft
environmental impact statement, if required, has been published and
BOEM will forward the COP, consistency certification, and associated
data and information to the applicable State CZMA agencies. BOEM has
determined that submitting the COP to the States for Federal
consistency review prior to the publication of a draft NEPA analysis
would be premature because the States would not have all the relevant
information at their disposal to make a State's consistency decision.
In practical terms, this will change the date on which a COP is
considered an ``active application'' under 15 CFR 930.51(f). Therefore,
the CZMA review period (or the start of the 30-day time period for a
State to submit an unlisted activity review request to NOAA under 15
CFR 930.54) will start on the date BOEM issues the notice of
availability for the draft NEPA analysis instead of the date BOEM
issues the notice of intent to publish a draft NEPA analysis.
BOEM has made several changes to the project easement requirements
in paragraph (g). In the final rule, BOEM revised the definition of
``project easement'' in Sec. 585.113 to mean ``an easement to which,
upon approval of your Construction and Operations Plan (COP) or (GAP),
you are entitled as part of the lease for the purpose of installing,
maintaining, repairing and replacing: gathering, transmission, and
distribution, and inter-array cables; power and pumping stations;
facility anchors; pipelines; and associated facilities and other
appurtenances on the OCS as necessary for the full enjoyment of the
lease.''
In order to provide flexibility to the lessee and minimize the need
for subsequent project easement amendments, BOEM amended paragraph (g)
to allow BOEM to issue project easements that ``provide sufficient off-
lease area to accommodate potential changes at the design and
installation phases with respect to any facilities or activities
necessary for your project.'' Although a larger easement would result
in greater rental fees under Sec. 585.507, under the final rule a
lessee may relinquish any unused portions of the easement after
construction is completed. BOEM believes that this approach will allow
a lessee to right-size the width of its project easements on a case-by-
case basis, depending on site conditions and a lessee's particular
needs. This revision is consistent with the PDE strategy described in
Project Design Envelope section of Section III above because it
maximizes a lessee's ability to make design choices later in the
development process without revising its COP or reopening the permit
review process. BOEM will still require that a COP include sufficient
survey data for whatever project easement areas are requested. This
final rule also will not affect the quantity and quality of data that
BOEM requires before the lessee may commence installation of the export
cable.
BOEM has also implemented a technical correction to paragraph
(g)(3) that would make project easements subject to the same conditions
as ROWs and RUEs under Sec. 585.302(b): that the United States can
grant rights in the area to other lessees or grantees that do not
unreasonably interfere with operations on the easement. Among other
reasons, these provisions are critical to ensure that nearby existing
or future offshore wind lessees are not definitively foreclosed from
using the same general cable routes established by an earlier lessee.
In the long run, cable routes shared by multiple projects could result
in lower environmental impacts, streamlined permitting, and economic
efficiencies.
Other remaining changes to this section are edits for
clarification, better organization, and consistency with changes to the
equivalent SAP and GAP regulations.
See Section III for further discussion of the comments BOEM
received on this section and BOEM's response to those comments.
Sec. 585.629 May I develop my lease in phases?
The content of this section was moved to Sec. 585.238 and this
section is now reserved.
Sec. 585.630 [Reserved]
Activities Under an Approved COP
Sec. 585.631 When must I initiate activities under an approved
COP?
In the NPRM, BOEM proposed to overhaul the organization and
duration of its commercial leases under Sec. 585.235, including the
addition of a new design and construction period. The final rule
includes the design and construction period at Sec. 585.235(a)(3)
during which design and construction period begins at COP approval and
ends when the operations period begins. BOEM determined that it was
confusing and undermined the intent of the creation of a ``design and
construction period'' to require a lessee to seek advanced approval of
a deviation in their ``construction schedule'' as stated in the
existing Sec. 585.631. Therefore, BOEM modified Sec. 585.631 in the
final rule to specify that a lessee is expected to start construction
on the OCS in accordance with the construction schedule specified in
the COP, unless the lessee notifies BOEM in advance.
Sec. 585.632 What documents must I submit before I may construct
and install facilities under my approved COP?
In this final rule, following publication of the Reorganization
Rule, BOEM is updating the cross references in this section to replace
BOEM-administered regulations with BSEE-administered regulations with
respect to the Facility Design Report (from 30 CFR 585.701 to 30 CFR
285.701), the Fabrication and Installation Report (from 30 CFR 585.702
to 30 CFR 285.702), and the Safety Management system (from 30 CFR
585.810 to 30 CFR 285.810).
Sec. 585.633 [Reserved]
Sec. 585.634 What activities require a revision to my COP, and
when will BOEM approve the revision?
The final rule revises paragraph (c) of this section to maintain
consistency with the corresponding changes to Sec. 585.617 for
revisions to SAPs by eliminating unnecessary verbiage in the list of
changes or modifications that could trigger the revision of an approved
COP and by merging the substance of existing paragraphs (c)(4), (5),
and (6) into revised paragraphs (c)(2) and (3). BOEM has also
incorporated in paragraph (c)(3) the PDE concept for a ``range'' of
facility locations for the reasons set forth above in sections Project
Design Envelope and Geophysical and Geotechnical Surveys of Section
III, and to ensure consistency with updated Sec. 585.626(a). By
incorporating the PDE, BOEM believes it can be less prescriptive
regarding the threshold that would trigger a COP revision and can allow
that threshold to be proportionate to the magnitude of the proposed
project changes. In response to comments, BOEM further built upon the
changes in the NPRM by adding references to activities ``on the OCS''
and ``that could have significant environmental impacts, or that may
affect threatened or endangered species, or that may affect designated
critical habitat of such species, or that may result in incidental take
of marine mammals for clarity, and for consistency with OCSLA, NEPA,
and other Federal statutes.
[[Page 42705]]
See Section III for a discussion of the comment received on this
section and BOEM's response to the comment.
Sec. 585.635 What must I do if I cease activities approved in my
COP before the end of my commercial lease?
A few technical edits have been added to this section as a result
of the Reorganization Rule (88 FR 6376). The word ``BOEM'' has been
replaced with ``BSEE'' in the first sentence. The reference to Sec.
585.437 is revised as Sec. 585.422. The reference to the subpart I has
been revised as 30 CFR part 285, subpart I.
Sec. Sec. 585.636-585-639 [Reserved]
General Activities Plan Requirements for Limited Leases, ROW Grants,
and RUE Grants
Sec. 585.640 What is a General Activities Plan (GAP)?
As proposed, this final rule eliminates the second sentence in
paragraph (b) because it is redundant of the requirements found in the
existing and proposed Sec. 585.303(a) regarding the due date for GAP
submissions. And, in the first sentence of paragraph (b), BOEM has
removed ``approved'' and replaced it with ``proposed'' because
activities are proposed until the GAP is approved.
Sec. 585.641 What must I demonstrate in my GAP?
As proposed, the final rule makes technical edits to ensure
consistency with revised Sec. Sec. 585.606 (SAPs) and 585.621 (COPs),
as appropriate.
Sec. 585.642 How do I submit my GAP?
In this final rule, BOEM has eliminated the paper copy requirement
for GAP submission, consistent with the revised provisions in Sec.
585.111, as proposed.
Sec. Sec. 585.643-585.644 [Reserved]
Contents of the General Activities Plan
Sec. 585.645 What must I include in my GAP?
BOEM has finalized the changes to this section as proposed in the
NPRM consistent with its revisions to Sec. Sec. 585.610 (SAPs) and
585.626 (COPs), as appropriate. This is also discussed in Project
Design Envelope and Geophysical and Geotechnical Surveys sections of
Section III.
Sec. 585.646 What information and certifications must I submit
with my GAP to assist BOEM in complying with NEPA and other applicable
laws?
BOEM has adopted the clarifications to the informational
requirements in paragraph (b) of this section that were proposed in the
NPRM and that are similar to those in revised Sec. 585.611(SAPs) and
in revised Sec. 585.627 (COPs) regarding information about resources,
conditions, and activities that your proposed activities may
significantly affect or that may have a significant effect on your
proposed activities (including where the potential significance of the
effect is unknown) and must contain any other information required by
law.
Additionally, in the section heading and regulatory text, the more
appropriate phrase ``applicable laws'' has replaced ``relevant laws.''
BOEM did not receive any substantive comments on this provision.
Sec. 585.647 How will my GAP be processed for Federal consistency
under the Coastal Zone Management Act?
In this final, as proposed, BOEM has made minor changes to provide
clarity and consistency with other changes, as described in the NPRM.
BOEM also made analogous revisions to the CZMA provisions for SAPs
(Sec. 585.612) and COPs (Sec. 585.628).
Sec. 585.648 How will BOEM process my GAP?
As proposed, BOEM made minor editorial changes to this section to
improve clarity, eliminate redundancy, enhance readability, and provide
consistency with the revisions to Sec. Sec. 585.613 (SAPs), 585.628
(COPs), and 585.102. In addition, a citation to 30 CFR 285.653(b) is
added in paragraph (e)(1) as a result of the Reorganization Rule (88 FR
6376).
Sec. 585.649 [Reserved]
Activities Under an Approved GAP
Sec. 585.650 When may I begin conducting activities under my GAP?
No changes were proposed for this section and no changes were made
to this section in this final rule.
Sec. 585.651 When may I construct complex or significant OCS
facilities on my limited lease or any facilities on my project easement
proposed under my GAP?
To be consistent with the Reorganization Rule (88 FR 6376), this
final rule modifies this section to cross-reference the SMS
requirements of BSEE's regulations. The new regulations specify that,
if a lessee is applying for a project easement, or installing a
facility or a combination of facilities on a limited lease deemed by
BOEM to be complex or significant, as provided in Sec. 585.648(a)(1),
the lessee must now also comply with the requirements of 30 CFR part
285, subpart G, and submit its safety management system description
required by 30 CFR 285.810 before construction may begin. The existing
regulations only referenced complying with SMS requirements, without
mentioning where these regulations were located, or the specific
requirements to be met.
Sec. 585.652 How long do I have to conduct activities under an
approved GAP?
As proposed, BOEM made a technical revision to paragraph (a) to
maintain consistency with its modifications to the limited lease
periods in Sec. 585.236. In the final rule, paragraph (a) is further
revised by replacing ``terms'' with ``operations period'' to be
consistent with Sec. 585.236(a)(2), which establishes the operations
period for a limited lease.
Sec. 585.653 What other reports or notices must I submit to BOEM
under my approved GAP?
To be consistent with the Reorganization Rule (88 FR 6376), BOEM
removed paragraphs (a) and (c) from this section and revised the
citation in paragraph (b) (now undesignated) from Sec. 585.113 to
Sec. 585.114.
Sec. 585.654 [Reserved]
Sec. 585.655 What activities require a revision to my GAP, and
when will BOEM approve the revision?
As proposed, BOEM made clarifications and technical edits to the
provisions regarding GAP revisions in paragraphs (a) and (c) that are
analogous to the revisions to Sec. Sec. 585.617 (SAP revisions) and
585.634 (COP revisions). In response to comments, BOEM further built
upon the changes by adding references to activities ``that could have
significant environmental impacts, or that may affect threatened or
endangered species, or that may affect designated critical habitat of
such species, or that may result in incidental take of marine mammals
for clarity, and for consistency with OCSLA, NEPA, and other Federal
statutes.''
Sec. 585.656 What must I do if I cease activities approved in my
GAP before the end of my term?
No changes were proposed for this section and no changes were made
to this section in this final rule.
Sec. 585.657 What must I do upon completion of approved activities
under my GAP?
BOEM clarified in the final rule that a lessee or grantee must
decommission its project as set forth in 30 CFR part 285, subpart I,
and submit a decommissioning application to BSEE as set forth in 30 CFR
285.905 and 285.906, which is analogous to the changes to the
corresponding SAP and COP requirements in Sec. Sec. 585.618(e) and
285.638, respectively. These changes are consistent with the
Reorganization Rule (88 FR 6376).
Cable and Pipeline Deviations
Sec. 585.658 Can my cable or pipeline construction deviate from my
approved COP or GAP?
[[Page 42706]]
No changes were proposed for this section and no changes were made
to this section in this final rule.
Sec. Sec. 585.659-585.699 [Reserved]
Environmental Protection Requirements Under Approved Plans
Sec. 585.700 What requirements must I include in my SAP, COP, or
GAP regarding air quality?
In the NPRM, the citation for this section was Sec. 585.659. The
Reorganization Rule (88 FR 6376) changed the citation for this section
to Sec. 585.700. As proposed, BOEM made a technical correction to
reflect Congress' 2011 CAA amendment expanding BOEM's air quality
jurisdiction to offshore of the North Slope Borough of Alaska.\31\ As
mentioned earlier, Sec. 585.659 is reserved in the final rule.
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\31\ 42 U.S.C. 7627.
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Sec. 585.701 How must I conduct my approved activities to protect
marine mammals, threatened and endangered species, and designated
critical habitat?
In the NPRM, the citation for this section was Sec. 585.801. The
Reorganization Rule (88 FR 6376) changed the citation for this section
to Sec. 585.701. Technical edits for consistency with the Marine
Mammal Protection Act were made to Sec. 585.701(b) and (e). No other
changes were made to this section.
Sec. 585.702 What must I do if I discover a potential
archaeological resource while conducting my approved activities?
In the NPRM, the citation for this section was Sec. 585.802. The
Reorganization Rule (88 FR 6376) changed the citation for this section
to Sec. 585.702. No other changes were made to this section.
Sec. 585.703 How must I conduct my approved activities to protect
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?
In the NPRM, the citation for this section was Sec. 585.803. The
Reorganization Rule (88 FR 6376) changed the citation for this section
to Sec. 585.703. No other changes were made to this section.
VI. Procedural Matters--Statutory and Executive Order Reviews
A. Executive Order 12866: Regulatory Planning and Review, as amended by
Executive Order 14094: Modernizing Regulatory Review, and Executive
Order 13563: Improving Regulation and Regulatory Review
E.O. 12866, as amended by E.O. 14094, provides that the Office of
Information and Regulatory Affairs (OIRA) in the Office of Management
and Budget (OMB) will review all significant rules. OIRA has determined
that this rule is a significant action under section 3(f)(1) of E.O.
12866, as amended by E.O. 14094. This rulemaking will result in an
annual effect on the economy of $200 million or more (adjusted every 3
years by the Administrator of OIRA for changes in gross domestic
product); or adversely affect in a material way the economy, a sector
of the economy, productivity, competition, jobs, the environment,
public health or safety, or State, local, territorial, or Tribal
governments or communities.
E.O. 13563 reaffirms the principles of E.O. 12866, as amended by
E.O. 14094, while calling for improvements in the Nation's regulatory
system to promote predictability and reduce uncertainty, and to use the
best, most innovative, and least burdensome tools for achieving
regulatory ends. E.O. 13563 directs agencies to consider regulatory
approaches that reduce burdens and maintain flexibility and freedom of
choice for the public where these approaches are relevant, feasible,
and consistent with regulatory objectives. BOEM and BSEE have developed
this rule in a manner consistent with these requirements.
Because this action is a significant regulatory action, it was
submitted to OMB for review. BOEM, on behalf of the Department,
prepared an analysis of the potential costs and benefits associated
with this action. This analysis, ``Renewable Energy Modernization Rule
Final Regulatory Impact Analysis'' is available in the docket. A brief
description of cost and benefit analysis is also provided in the
Summary of Cost, Economic Impacts, and Additional Analyses Conducted
section of Section IV in the preamble.
B. Regulatory Flexibility Act (RFA)
The Regulatory Flexibility Act (RFA), 5 U.S.C. 601-612, requires
agencies to analyze the economic impact of regulations when a
significant economic impact on a substantial number of small entities
is likely and to consider regulatory alternatives that will achieve the
agency's goals while minimizing the burden on small entities. Pursuant
to section 603 of the RFA, BOEM, on behalf of the Department, prepared
a regulatory flexibility impact analysis that examined the impacts of
the proposed rule on small entities along with regulatory alternatives
that could minimize that impact. The results of recent BOEM renewable
energy auctions have demonstrated that companies interested in
developing OCS wind energy resources (i.e., companies that have
submitted bids in BOEM auctions) are all either large firms or partners
with large firms in joint ventures. Commercial-scale projects cost
hundreds of millions to billions of dollars to install and operate. As
a result, it is unlikely that small entities will be independently
constructing or operating OCS wind facilities in the foreseeable
future. The cost savings associated with this rule are available to all
companies developing and operating OCS renewable energy facilities. If
small companies do participate in the OCS renewable energy industry
moving forward, the cost savings from this rule would benefit them
accordingly. Therefore, BOEM has determined that the rule would not
likely cause a significant economic impact on a substantial number of
small entities. The regulatory flexibility impact analysis was provided
in the docket for public comment (Renewable Energy Modernization Rule:
Initial Regulatory Impact Analysis, Docket No. BOEM-2023-0005).
This final action will not have a significant economic impact on a
substantial number of small entities under the RFA. This action will
not impose any unique requirements on small entities. This final rule
would directly affect all current and future OCS renewable energy
developers, as discussed in the NPRM. BOEM has prepared a final
regulatory flexibility impact analysis, which is available in the
docket for this rulemaking (Docket No. BOEM-2023-0005).
BOEM received two comments specific to the RIA. One commenter
asserted that BOEM's definition of the baseline scenario in the
existing regulatory framework does not consider the impacts to small
fishing businesses and small coastal communities and suggested that
BOEM conduct a regulatory impact analysis due to these potential
impacts. Another commenter discussed the cost-benefits analysis of the
proposed rule, including discussion of the RIA. The commenter suggested
that, in accordance with Circular A-4, BOEM should continue its cost-
benefits analysis of the proposed rule after it has been enacted to
measure the cost-savings associated with climate impacts of OSW
development, to assess costs to coastal communities, and to consider
impacts to marine ecology, health and safety, social cost of carbon,
and other unforeseen costs.
C. Small Business Regulatory Enforcement Fairness Act (SBREFA)
The Small Business Regulatory Enforcement Fairness Act (SBREFA), 5
[[Page 42707]]
U.S.C. 804(2), requires the Department to perform a regulatory
flexibility analysis, provide guidance, and help small businesses
comply with statutes and regulations for major rulemakings. This action
is subject to the SBREFA because it has an annual effect on the economy
of $100 million or more. The Department anticipates this final rule
would have neither significant employment nor small business impacts;
nor cause major price increases for consumers, businesses, or
governments; nor significantly degrade competition, employment,
investment, productivity, innovation, or the ability of U.S. businesses
to compete against foreign businesses. This rule seeks to ensure safe
and responsible domestic energy production as the nation transitions to
a clean energy future. No specific comments on the SBREFA were received
during the public comment period.
D. Unfunded Mandates Reform Act (UMRA)
The Unfunded Mandates Reform Act (UMRA), 2 U.S.C. 1531-1538,
requires the Department, unless otherwise prohibited by law, to assess
the effects of their regulatory actions on State, local, and Tribal
governments, and the private sector. Section 202 of UMRA generally
requires the Department to prepare a written statement, including a
cost-benefit analysis, for each proposed and final rule with ``Federal
mandates'' that may result in expenditures by State, local, and Tribal
governments, in the aggregate, or to the private sector, of $100
million or more in any one year, adjusted for inflation. This action
does not contain an unfunded mandate of $100 million or more as
described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or
uniquely affect small governments. The action implements mandate(s)
specifically and explicitly set forth in OCSLA without the exercise of
any policy discretion by BOEM and BSEE. No comments on the UMRA were
received during the public comment period.
E. Executive Order 12630: Governmental Actions and Interference With
Constitutionally Protected Property Rights
Executive Order 12630, Governmental Actions and Interference with
Constitutionally Protected Property Rights, ensures that government
actions affecting the use of private property are undertaken on a well-
reasoned basis with due regard for the potential financial impacts
imposed on the government. This action does not affect a taking of
private property or otherwise have taking implications under E.O.
12630. To the extent OCS renewable energy lessees and grantees possess
private property rights under the terms of BOEM leases, this final rule
is not expected to reduce the value of those rights. A takings
implication assessment is not required. No comments were received on
E.O. 12630 during the public comment period.
F. Executive Order 13132: Federalism
Regulatory actions that have substantial direct effects on the
States, on the relationship between the National Government and the
States, or on the distribution of power and responsibilities among the
various levels of government are subject to E.O. 13132. Under the
criteria in section 1 of E.O. 13132, this final rule does not have
sufficient federalism implications to warrant the preparation of a
federalism summary impact statement. It will not have substantial
direct effects on the states, on the relationship between the national
government and the states, or on the distribution of power and
responsibilities among the various levels of government. No comments
were received on E.O. 13132 during the public comment period.
G. Executive Order 12988: Civil Justice Reform
This rule complies with the requirements of E.O. 12988.
Specifically, this rule:
(1) Meets the criteria of section 3(a) requiring that all
regulations must be reviewed to eliminate errors and ambiguity and be
written to minimize litigation; and
(2) Meets the criteria of section 3(b)(2) requiring that all
regulations must be written in clear language and contain clear legal
standards.
No comments were received on E.O. 12988 during the public comment
period.
H. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments
Executive Order 13175 defines ``polices that have Tribal
implications'' as ``regulations, legislative comments or proposed
legislation, and other policy statements or actions that have
substantial direct effects on one or more Indian tribes, on the
relationship between the Federal government and Indian tribes, or on
the distribution of power and responsibilities between the Federal
government and Indian tribes.'' The Department strives to strengthen
its government-to-government relationships with Tribal Nations through
a commitment to consultation with those Tribes, recognition of their
right to self-governance and Tribal sovereignty, and honoring BOEM's
trust responsibilities for Tribal Nations. The Department's
consultation policy for Tribal Nations, is described in Departmental
Manual part 512 chapter 4.\32\
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\32\ Available at https://www.doi.gov/sites/doi.gov/files/elips/documents/512-dm-4_2.pdf.
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DOI's procedures for consultation with Tribal Nations also provide
that: ``Bureaus/Offices must invite Indian Tribes early in the planning
process to consult whenever a Departmental plan or action with Tribal
Implications arises. Bureaus/Offices should operate under the
assumption that all actions with land or resource use or resource
impacts may have Tribal implications and should extend consultation
invitations accordingly.'' 512 DM 5.4.A. (November 30, 2022).
Additionally, the Department is also respectful of its
responsibilities for consultation with Alaska Native Claims Settlement
Act (ANCSA) Corporations. The Department's consultation policy \33\
defines a Departmental Action with ANCSA Corporation Implications and
the Department's consultation procedures for ANCSA Corporations also
provide: ``Bureaus and Offices should operate under the assumption that
all actions with land or resource use or resource impacts may have
ANCSA Corporation implications and should extend consultation
invitations accordingly. When ANCSA Corporations indicate that there is
substantial and direct effect of the Departmental Action with ANCSA
Corporation Implications, the Department must engage in consultation.''
512 DM 7.4.A. (November 30, 2022).
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\33\ Available at https://www.doi.gov/sites/doi.gov/files/elips/documents/512-dm-6.pdf.
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The Department has evaluated this final rule under its consultation
policy and under the criteria in E.O. 13175. The final rule may have
Tribal implications. Accordingly, we have consulted with affected
Tribes on a government-to-government basis as discussed in section What
Tribal engagement activities were conducted of Section IV of this
preamble, and we have fully considered Tribal views in the final rule.
During the consultation process, the Tribes reiterated their comments
submitted on the proposed rule through https://www.regulations.gov.
Section III of this preamble describes how the final rule addresses
comments and concerns submitted by the Tribes. No ANCSA Corporations
requested consultation. A
[[Page 42708]]
summary of the consultations and staff-level meetings held on this
rulemaking, as well as notes from those meetings are available in the
docket (Docket No. BOEM-2023-0005). BOEM and BSEE can consult at any
time with federally recognized Tribes as sovereign nations and with
ANCSA Corporations, including after the rule is promulgated.
I. Paperwork Reduction Act (PRA)
The Paperwork Reduction Act of 1995, 44 U.S.C. 3501-3521, provides
that an agency may not conduct or sponsor, and a person is not required
to respond to, a ``collection of information'' unless it displays a
currently valid OMB control number. Collections of information include
requests and requirements that an individual, partnership, or
corporation obtain information and report it to a Federal agency (44
U.S.C. 3502(3); 5 CFR 1320.3(c) and (k)).
A proposed rule, soliciting comments on this collection of
information for 30 days, was published on January 30, 2023 (88 FR
5968). Subsequent to the publication of the proposed rule, the
Department published a final rule titled ``Reorganization of Title 30-
Renewable Energy and Alternate Uses of Existing Facilities on the Outer
Continental Shelf'' in the Federal Register on January 31, 2023 (88 FR
6376), which relocated or reproduced certain of the regulatory
provisions addressed in the proposed rule under 30 CFR part 585 to the
newly created 30 CFR part 285. The DOI published a correction
notification in the Federal Register on January 3, 2024 (89 FR 309), to
provide the public an opportunity to comment on collections of
information that were transferred from BOEM to BSEE on January 31,
2023, under the rule titled ``Reorganization of Title 30-Renewable
Energy and Alternate Uses of Existing Facilities on the Outer
Continental Shelf.'' Therefore, this final rule contains existing and
new ICs for BSEE's regulations at 30 CFR part 285 and BOEM's
regulations at 30 CFR part 585 that have been submitted to the OMB for
review and approval under the Paperwork Reduction Act. OMB has reviewed
and approved BSEE's ICs requirements in this rule and assigned OMB
Control Number 1014-0034, which expires April 30, 2026. OMB has
reviewed BOEM's ICs requirements in this rule and assigned OMB Control
Number 1010-0195. With this final rule, BOEM will transfer the hour
burden from this collection to OMB Control Number 1010-0176, which
expires January 31, 2026, then discontinue OMB Control Number 1010-
0195. The IC aspects affecting each Bureau are discussed separately
below.
BSEE Information Collection--30 CFR Part 285
BSEE published a correcting amendment January 3, 2024 (89 FR 309),
pertaining to the Department's proposed rule, Renewable Energy
Modernization Rule, which was published in the Federal Register on
January 30, 2023 (88 FR 5968). Subsequent to publication of the
proposed rule, the Department published the rule titled Reorganization
of Title 30--Renewable Energy and Alternate Uses of Existing Facilities
on the Outer Continental Shelf in the Federal Register on January 31,
2023 (88 FR 6376), which relocated or reproduced certain of the
regulatory provisions addressed in the proposed rule under 30 CFR part
585 in the newly created 30 CFR part 285. The correcting amendment
solicited comments on BSEE's collection of information pertaining to
this rulemaking. The public comment period ended on March 4, 2024. No
comments were received. See https://www.govinfo.gov/content/pkg/FR-2023-08-14/pdf/2023-17421.pdf.
As discussed in the section-by-section analysis above, comments
received on the proposed rule will make changes in this final rule by
adding Sec. 285.116, Request for Information; furthermore, there are
no changes in burden due to 5 CFR 1320.3(h)(4).
Final Sec. 285.637(c) requires operators to notify BSEE within 10
business days after commencing commercial operations. BSEE will add +1-
hour burden to Sec. 285.637(c).
Final Sec. 285.700(b) will require operators to explain to BSEE
how all integrated asset packages will function together effectively.
BSEE will add +10-hour burdens to Sec. 285.700(b).
Final Sec. 285.810 will clarify that a SMS is required to be
submitted to BSEE to conduct activities pursuant to a lease, from met
buoy placement and site assessment work through decommissioning. While
a description of the SMS is required to be submitted for review by BSEE
with a COP, and for review of an SAP or GAP if the facilities being
installed are deemed by the Department to be complex or significant,
this addition will make it clear that a structured approach to safety
is both expected and required for all operations. BSEE will add +60
annual hour burdens to Sec. 285.810.
Final Sec. 285.812(b)(1) and (2) will add new reporting
requirements. Proposed Sec. 285.812(b)(1) will require an annual
summary of safety performance data covering the previous calendar year
during which site assessment, construction, operations, or
decommissioning activities occurred by submitting Form BSEE-0187,
Performance Measures Data--Renewable Energy. This form will include
company identification and number of injuries, illnesses, and hours
worked by company employees and contractors. This information will be
used to develop incident rates that will help assess workplace safety
and environmental compliance across the OCS renewable energy industry.
BSEE will add +820 annual burden hours to Sec. 285.812(b)(1).
Final Sec. 285.812(b)(2) will require a summary of the most recent
SMS audit, corrective actions implemented or pending because of that
audit, and an updated SMS description highlighting changes made since
the last report. This report will be due every 3 years or upon BSEE's
request. BSEE will add +5 annual burden hours to Sec. 285.812(b)(2).
For final Sec. 285.830(d), BSEE will remove -2 burden hours since
the burdens for reporting oil spills falls under OMB Control Number
1014-0007.
Abstract: BSEE will use the information to oversee facility design,
fabrication, installation, and safety management systems; ensure the
safety of operations, including inspection programs and incident
reporting and investigations; enforce compliance with all applicable
safety, environmental, and other laws and regulations through
enforcement actions (such as noncompliance notices, cessation orders,
and certain lease suspensions); and oversee decommissioning activities.
These responsibilities include enforcement provisions under the
existing part 285, subpart D, various information submittal
requirements under subpart F, as well as provisions governing
activities conducted under an approved plan, including the design,
construction, operation, and decommissioning of facilities under
subparts G, H, and I.
Title of Collection: 30 CFR part 285, Renewable Energy and
Alternate Uses of Existing Facilities on the Outer Continental Shelf.
OMB Control Number: 1014-0034.
Forms: Forms BSEE-1835, Notice(s) of Noncompliance (NONCs) and
BSEE-0187, Performance Measures Data--Renewable Energy.
Type of Review: Revision of a currently approved collection.
Respondents/Affected Public: Primary respondents comprise Federal
OCS companies that submit unsolicited proposals or responses to Federal
Register notices; or are lessees, designated operators, and Right-of-
Way or Right-of-Use and Easement grantees.
[[Page 42709]]
Other potential respondents are companies or state and local
governments that submit information or comments relative to alternative
energy-related uses of the OCS; certified verification agents; and
surety or third-party guarantors.
Total Estimated Number of Annual Respondents: Currently there are
approximately 47 lessees in the OCS. Not all the potential respondents
will submit information in any given year, and some may submit multiple
times.
Total Estimated Number of Annual Responses: 16.
Estimated Completion Time per Response: Varies from 30 minutes to
6,000 hours, depending on activity.
Total Estimated Number of Annual Burden Hours: 894.
Respondent's Obligation: Responses are mandatory and are required
to obtain or retain a benefit.
Frequency of Collection: Generally, submissions are on occasion or
annual.
Total Estimated Annual Nonhour Burden Cost: N/A.
Below is a burden table of the final rule changes BSEE will
require. New burden changes are shown in BOLD and revised burdens are
shown in italic:
BILLING CODE 4340-98-P
[GRAPHIC] [TIFF OMITTED] TR15MY24.000
BILLING CODE 4340-98-C
As part of our continuing effort to reduce paperwork and respondent
burdens, we invite the public and other Federal agencies to comment on
any aspect of this information collection, including:
(1) Whether or not the collection of information is necessary for
the proper performance of the functions of the agency, including
whether or not the information will have practical utility;
[[Page 42710]]
(2) The accuracy of our estimate of the burden for this collection
of information, including the validity of the methodology and
assumptions used;
(3) Ways to enhance the quality, utility, and clarity of the
information to be collected; and
(4) Ways to minimize the burden of the collection of information on
those who are to respond, including through the use of appropriate
automated, electronic, mechanical, or other technological collection
techniques or other forms of information technology, e.g., permitting
electronic submission of response.
Written comments and suggestions on the information collection
requirements should be submitted by the date specified above in DATES
to https://www.reginfo.gov/public/do/PRAMain. Find this particular
information collection by selecting ``Currently under Review--Open for
Public Comments'' or by using the search function. Please provide a
copy of your comments to Nikki Mason, 45600 Woodland Road, Sterling, VA
20166; or by email to [email protected]. Please reference OMB Control
Number 1014-0034 in the subject line of your comments.
BOEM Information Collection--30 CFR Parts 585 and 586
With this final rulemaking, BOEM revises the collections of
information in the proposed rule. The regulations in this final rule
revise existing requirements and establish new requirements in 30 CFR
part 585. OMB reviewed BOEM's information collections in this rule and
assigned the temporary OMB Control Number 1010-0195. When the final
rule is effective, BOEM will transfer the hour burden from this
collection to revise OMB Control Number 1010-0176, and discontinue OMB
Control Number 1010-0195. OMB Control Number 1010-0176 is the control
number that OMB has assigned to the collections of information under 30
CFR parts 585 and 586, Renewable Energy on the Outer Continental Shelf.
With the publication of the final rule titled Reorganization of
Title 30--Renewable Energy and Alternate Uses of Existing Facilities on
the Outer Continental Shelf in the Federal Register on January 31, 2023
(88 FR 6376), certain regulatory provisions were transferred from
BOEM's 30 CFR part 585 regulations to BSEE's newly created 30 CFR part
285 regulations. Certain collections of information pertaining to BSEE
were also transferred. The collections of information that moved to
BSEE are noted above in BSEE Information Collection--30 CFR part 285.
This final rule decreases BOEM's annual burden hours overall by
290; the non-hour costs remain unchanged. As discussed in the section-
by-section analysis above and in the supporting statement available at
https://www.reginfo.gov, this rule revises the following BOEM paperwork
burdens:
BILLING CODE 4340-98-P
[[Page 42711]]
[GRAPHIC] [TIFF OMITTED] TR15MY24.001
BILLING CODE 4340-98-C
Subpart B. This final rule adds a new subpart B for the renewable
energy leasing schedule published by the Secretary of the Interior.
BOEM estimates no burdens for this subpart, but the lettering for the
subsequent subparts is revised accordingly.
Subpart C. Section 585.216(c) relates to eligibility for bidding
credits as set forth in the FSN before the lease auction takes place.
Bidders seeking a bidding credit in the auction must establish that
they are eligible for each bidding credit that they seek. Bidders may
participate in the auction without applying for or receiving a bidding
credit, at their discretion. BOEM is keeping the annual burden hours
the same as in the 2023 approved OMB Control Number 1010-0176 (2023
approval) but attributes the hours to the requirements of the bidding
credit eligibility criteria.
Subpart E. Section 585.413 aligns the regulations with the existing
practice allowing for lease and grant consolidation. BOEM adds 10
annual burden hours to the 2023 approval attributable to Sec. 585.413
to account for submission of applications to consolidate all or part of
two or more adjacent leases or grants by the same lessee or grantee
into one new lease or grant, and to negotiate with BOEM on
inconsistencies in terms and conditions.
Subpart G. Section 585.600(a) significantly revises the requirement
for SAPs. Under this final rule, a SAP is required only when site
assessment activities involve an engineered foundation. BOEM will not
require a SAP for floating site assessment
[[Page 42712]]
facilities, such as met buoys. BOEM also has the discretion to waive
certain information requirements in a proposed plan, which could add
flexibility to the permit application process. BOEM removes 240 annual
burden hours from Sec. 585.600(a).
Section 585.615(b) relates to other reports or notices that must be
submitted periodically under an approved SAP. With the narrowing of the
SAP requirement to site assessment activities involving an engineered
foundation, BOEM estimates fewer reports or notices filed under this
section. BOEM removes 60 annual burden hours from Sec. 585.615(b).
This final rule allows the deferral of detailed geotechnical survey
reporting from COP submission under the existing Sec. 585.626(b) to
FDR submission under 30 CFR 285.585.701(a). This change does not
increase annual burden hours.
Title of Collection: Renewable Energy Modernization (Final
Rulemaking).
OMB Control Number: 1010-0195.
Form Numbers: None.
Type of Review: New.
Respondents/Affected Public: Respondents primarily are private
sector companies interested in developing or operating OCS renewable
energy leases and grants; affected State, local, and Tribal
governments; and other companies that submit information regarding OCS
renewable energy projects.
Total Estimated Number of Annual Responses: Decrease of 2 annual
responses.
Total Estimated Number of Annual Burden Hours: Decrease of 290
hours.
Due to a ROCIS system limitation, BOEM is unable to show a negative
number for responses and hours in ROCIS; therefore, the table for 1010-
0195 found on https://www.reginfo.gov shows a place marker of one
response and one hour.
Respondent's Obligations: Responses to ICs under this part are
mandatory to obtain, or retain, an OCS renewable energy lease or grant.
Frequency of Collection: The frequency of collection varies
depending upon BOEM's decisions to issue OCS leases or grants for
renewable energy development, a company's decision to seek a lease or
grant, and the manner in which the lessee or grantee elects to develop
its lease or grant.
Total Estimated Annual Non-Hour Burden Cost: No non-hour costs.
Once the rule becomes effective and OMB approves the IC request
1010-0195, BOEM plans to revise the existing OMB Control Number 1010-
0176 for the affected subparts discussed above and adjust the annual
burden hours accordingly. For OMB Control Number 1010-0176, the
existing annual burden hours are 9,876 and responses are 200. The final
rule requirement changes reduce the annual burden hours to 9,586 annual
burden hours and 198 responses. The ICs related to 30 CFR part 585 do
not include questions of a sensitive nature. BOEM will continue to
protect proprietary information according to FOIA and the Department's
implementing regulations, which address disclosure of information to
the public.\34\
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\34\ See 43 CFR part 2 and 30 CFR 585.114.
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In addition, the PRA requires agencies to estimate the total annual
reporting and recordkeeping non-hour cost burden resulting from the
collection of information. BOEM solicits your comments regarding non-
hour cost burdens arising from this rule. For reporting and
recordkeeping only, your response should split the cost estimate into
two components: (1) total capital and startup cost component, and (2)
annual operation, maintenance, and disclosure cost component, to
provide the information. You should describe the methods you use to
estimate your cost components, including system and technology
acquisition, expected useful life of capital equipment, discount
rate(s), and the period over which you incur costs. Generally, your
estimates should not include equipment or services purchased: (1)
before October 1, 1995; (2) to comply with requirements not associated
with the IC arising from this rule; (3) for reasons other than to
provide information or to keep records for the U.S. Government; or (4)
as part of customary and usual business or private practices.
As part of BOEM's continuing effort to reduce paperwork and
respondent burdens, BOEM invites the public and other Federal agencies
to comment on any aspect of this IC, including:
(1) Is the IC necessary or useful for BOEM to properly perform its
functions?
(2) Are the estimated annual burden hour increases and decreases
resulting from this final rule reasonable?
(3) Is the estimated annual non-hour cost burden resulting from
this IC reasonable?
(4) Do you have any suggestions that would enhance the quality,
clarity, or usefulness of the information to be collected?
(5) Is there a way to minimize the IC burden on those who must
respond, such as by using appropriate automated digital, electronic,
mechanical, or other forms of information technology?
Send your comments and suggestions on this IC by the date indicated
in the DATES section to the Desk Officer for the Department at OMB-OIRA
at (202) 395-5806 (fax) or via the https://www.reginfo.gov portal
(online). You may view the IC request(s) at https://www.reginfo.gov/public/do/PRAMain. Due to a ROCIS system limitation, BOEM is unable to
show a negative number for responses and hours in ROCIS; therefore, the
table for 1010-0195 found on https://www.reginfo.gov shows a place
marker of one response and one hour. Please provide a copy of your
comments to the BOEM IC Clearance Officer (see the ADDRESSES section).
You may contact Anna Atkinson, BOEM IC Clearance Officer at (703) 787-
1025 with any questions. Please reference Renewable Energy
Modernization Rule (1010-0195) in your comments.
J. National Environmental Policy Act (NEPA)
This rule does not constitute a major Federal action significantly
affecting the quality of the human environment. A detailed
environmental analysis under NEPA is not required because this final
rule is covered by a categorical exclusion (see 43 CFR 46.205). This
final rule meets the criteria set forth at 43 CFR 46.210(i) for a
Departmental categorical exclusion in that this action is ``of an
administrative, financial, legal, technical, or procedural nature.''
BOEM has also determined that the final rule does not involve any of
the extraordinary circumstances listed in 43 CFR 46.215 that would
require further analysis under NEPA.
Multiple commenters asserted that BOEM should conduct a NEPA review
for the final rule. BOEM disagrees with this assertion as this
rulemaking does not authorize any activities. Nothing in this
rulemaking reduces or eliminates BOEM's environmental review of
renewable energy activities, including site characterization
(geotechnical and geophysical surveys, biological surveys) and site
assessment activities (deployment of met towers and buoys). This review
is completed during BOEM's development of an EA pursuant to NEPA which
typically concludes with the release of a Final EA and a Finding of No
Significant Impact between publication of a PSN and a FSN (i.e., prior
to issuing a lease). BOEM's EAs analyze environmental impacts of
activities expected to take place following lease issuance, including
site characterization and site assessment activities. BOEM also
conducts environmental review of proposed development activities
through a NEPA
[[Page 42713]]
analysis of the COP. BOEM identifies and avoids or reduces potential
environmental impacts throughout the process of offshore wind planning,
including using spatial data and stakeholder input to identify
appropriate areas for potential wind energy development. This process
will not change as a result of these regulations. In addition, every
BOEM environmental analysis pursuant to NEPA considers the potential
cumulative impacts of wind energy development prior to approving
development activities.
K. Data Quality Act
In promulgating this rule, the Department did not conduct or use a
study, experiment, or survey requiring peer review under the Data
Quality Act (Pub. L. 106-554, app. C, sec. 515, 114 Stat. 2763, 2763A-
153-154). In accordance with the Data Quality Act, the Department has
issued guidance regarding the quality of information that it relies
upon for regulatory decisions. This guidance is available at the
Department's website at: https://www.doi.gov/ocio/policy-mgmt-support/information-and-records-management/iq. No comments were received on the
Data Quality Act during the public comment period.
L. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
Under E.O. 13211, the Department is required to prepare and submit
to OMB a ``Statement of Energy Effects'' for ``significant energy
actions.'' This should include a detailed statement of any adverse
effects on energy supply, distribution, or use (including a shortfall
in supply, price increases, and increased use of foreign supplies)
expected to result from the action and a discussion of reasonable
alternatives and their effects. This action is not a ``significant
energy action'' because it is not likely to have a significant adverse
effect on the supply, distribution or use of energy. This final rule
does not add new regulatory compliance requirements that would result
in significant adverse energy effects, rather the regulatory changes
will help reduce compliance burdens on the OCS renewable energy
industry that may hinder the continued development or use of
domestically produced energy resources. Reduced regulatory burdens do
not adversely affect productivity, competition, or prices within the
energy sector. For these reasons, this final rule is not a significant
energy action under the definition in E.O. 13211, and therefore, a
Statement of Energy Effects is not required. No comments were received
on E.O. 13211 during the public comment period.
M. Congressional Review Act (CRA)
This action is subject to the CRA, and the Department will submit a
rule report to each chamber of Congress and to the Comptroller General
of the United States. This action meets the criteria in 5 U.S.C.
804(2).
N. Severability
If a court holds any provisions of this final rule or their
applicability to any persons or circumstances invalid, the remainder of
the provisions and their applicability to other people or circumstances
will not be affected.
List of Subjects
30 CFR Part 285
Continental shelf, Energy, Environmental protection, Historic
preservation, Marine resources, Marine safety, Natural resources, Ocean
resources, Offshore energy, Offshore structures, Outer continental
shelf, Renewable energy, Reporting and recordkeeping requirements,
Safety, Wind energy.
30 CFR Part 585
Administrative practice and procedure, Assessment plans, Coastal
zone, Compliance, Electric power, Energy, Environmental protection,
Government leases, Intergovernmental relations, Marine resources,
Natural resources, Ocean resources, Offshore energy, Offshore
structures, Outer continental shelf, Payments, Planning, Power
resources, Renewable energy, Reporting and recordkeeping requirements,
Revenue sharing, Right-of-way, Right-of-use-and-easement, Wind energy.
Delegation of Signing Authority
This action by the Deputy Assistant Secretary is taken herein
pursuant to an existing delegation of authority.
Steven H. Feldgus,
Principal Deputy Assistant Secretary, Land and Minerals Management.
For the reasons stated in the preamble, BSEE amends 30 CFR part 285
and BOEM amends 30 CFR part 585 as follows:
PART 285--RENEWABLE ENERGY AND ALTERNATE USES OF EXISTING
FACILITIES ON THE OUTER CONTINENTAL SHELF
0
1. The authority citation for part 285 continues to read as follows:
Authority: 43 U.S.C. 1331 et seq.
Subpart A--General Provisions
0
2. Amend Sec. 285.103 by revising paragraph (a) to read as follows:
Sec. 285.103 When may BSEE prescribe or approve departures from the
regulations in this part?
(a) BSEE may prescribe or approve departures from the provisions of
this part when departures are necessary because the applicable
provision(s) as applied to a specific circumstance:
(1) Are impractical or unduly burdensome and the departure is
necessary to achieve the intended objectives of the renewable energy
program;
(2) Fail to conserve the natural resources of the OCS;
(3) Fail to protect life (including human and wildlife), property,
or the marine, coastal, or human environment; or
(4) Fail to protect sites, structures, or objects of historical or
archaeological significance.
* * * * *
0
3. Amend Sec. 285.105 by revising paragraph (d) to read as follows:
Sec. 285.105 What are my responsibilities under this part?
* * * * *
(d) Comply with all applicable laws and regulations, the terms of
your lease or grant under 30 CFR part 585 or 586, reports, notices, and
approved plans prepared under this part, 30 CFR part 585 or 586, and
any conditions imposed by BOEM or BSEE through its review of any of
these reports, notices, and approved plans, as provided in this part or
in 30 CFR part 585 or 586;
* * * * *
0
4. Revise Sec. 285.110 to read as follows:
Sec. 285.110 How do I submit applications, reports, or notices
required by this part?
Unless otherwise stated, you must submit one electronic copy of all
plans, applications, reports, or notices required by this part to BSEE.
BSEE will inform you if it requires paper copies of specific documents.
Unless stated otherwise, documents should be submitted to the relevant
contacts listed on the BSEE website.
0
5. Amend Sec. 285.112 by:
0
a. Revising the definitions of ``Commercial activities'' and
``Commercial operations'';
0
b. Adding in alphabetical order the definition for ``Critical Safety
Systems and Equipment'';
0
c. Revising the definition of ``Decommissioning'';
[[Page 42714]]
0
d. Adding in alphabetical order the definitions of ``Fabrication'' and
``Project Design Envelope''; and
0
e. Revising the definition of ``Site assessment activities''.
The additions and revisions read as follows:
Sec. 285.112 Definitions.
* * * * *
Commercial activities means, under renewable energy leases and
grants, all activities associated with the generation, storage, or
transmission of electricity or other energy product from a renewable
energy project on the OCS, and for which such electricity or other
energy product is intended for distribution, sale, or other commercial
use, except for electricity or other energy product distributed or sold
pursuant to technology-testing activities on a limited lease. This term
also includes activities associated with all stages of development,
including initial site characterization and assessment, facility
construction, and project decommissioning.
* * * * *
Commercial operations means the generation of electricity or other
energy product for commercial use, sale, transmission, or distribution
from a commercial lease.
Critical Safety Systems and Equipment means safety systems and
equipment designed to prevent or ameliorate fires, spillages, or other
major accidents that could result in harm to health, safety, or the
environment in the area of your facilities.
Decommissioning means removing BOEM and BSEE approved facilities
and returning the site of the lease or grant to a condition that meets
the requirements under subpart I of this part.
* * * * *
Fabrication means the cutting, fitting, welding, or other assembly
of project elements.
* * * * *
Project Design Envelope (PDE) means a reasonable range of design
parameters proposed in a lessee's plan for components of the project,
such as type, dimensions, and number of wind turbine generators;
foundation type; location of the export cable route; location of an
onshore substation; location of the grid connection point; and
construction methods and timing.
* * * * *
Site assessment activities means those initial activities conducted
to assess an area on the OCS, such as resource assessment surveys
(e.g., meteorological and oceanographic) or technology testing,
involving the installation of bottom-founded facilities.
* * * * *
0
6. Amend Sec. 285.113 by revising paragraph (b)(1) to read as follows:
Sec. 285.113 How will data and information obtained by BSEE under
this part be disclosed to the public?
* * * * *
(b) * * *
------------------------------------------------------------------------
Then BSEE will review data and
If you have a . . . information for possible release:
------------------------------------------------------------------------
(1) Commercial lease......... At the earlier of: (i) 3 years after the
commencement of commercial operations;
or (ii) 3 years after the lease
terminates.
* * * * * * *
------------------------------------------------------------------------
* * * * *
0
7. Revise Sec. 285.116 to read as follows:
Sec. 285.116 Requests for information on the state of the offshore
renewable energy industry.
BSEE may publish a request for information (RFI) in the Federal
Register to solicit information from industry, State and local
agencies, federally recognized Tribes, and other interested entities
for evaluating the offshore renewable energy industry, including the
identification of potential challenges or obstacles to its continued
development. An RFI may relate to the identification of environmental,
technical, regulatory, or economic matters that promote or detract from
continued development of renewable energy technologies on the OCS. BSEE
may use the information received to refine its renewable energy
program, including to facilitate OCS renewable energy development in a
safe and environmentally responsible manner and to ensure a fair return
to the United States for use of the OCS.
0
8. Add Sec. 285.117 to read as follows:
Sec. 285.117 Severability.
If a court holds any provisions of this subpart or their
applicability to any persons or circumstances invalid, the remainder of
the provisions and their applicability to any persons or circumstances
will not be affected.
0
9. Revise Sec. 285.118 to read as follows:
Sec. 285.118 What are my appeal rights?
(a) Any party adversely affected by a final decision issued by BSEE
under this part may appeal that decision to the Interior Board of Land
Appeals (IBLA), under 30 CFR part 290 and 43 CFR part 4, subpart E.
(b) Any final decision will remain in full force and effect during
the pendency of an appeal unless a stay is granted pursuant to 43 CFR
part 4.
Subpart D--Lease and Grant Administration
0
10. Amend Sec. 285.400 by revising paragraph (f) to read as follows:
Sec. 285.400 What happens if I fail to comply with this part?
* * * * *
(f) BSEE may assess civil penalties, as authorized by section 24 of
the OCS Lands Act and as determined under the procedures set forth in
30 CFR part 250, subpart N, if you fail to comply with any provision of
this part, or any term of a lease, grant, or order issued under the
authority of this part:
(1) After notice of such failure and expiration of any reasonable
period allowed for corrective action; or
(2) BSEE determines that the failure constitutes, or constituted, a
threat of serious, irreparable, or immediate harm or damage to life
(including fish and other aquatic life), property, or the marine,
coastal, or human environment.
* * * * *
0
11. Amend Sec. 285.415 by revising paragraph (b) to read as follows:
Sec. 285.415 What is a lease or grant suspension?
* * * * *
(b) A suspension extends the expiration date for the relevant
period of your lease or grant for the length of time the suspension is
in effect.
* * * * *
0
12. Amend Sec. 285.417 by revising paragraph (b)(2) to read as
follows:
Sec. 285.417 When may BSEE order a suspension?
* * * * *
(b) * * *
[[Page 42715]]
(2) You must furnish an electronic copy of the study and results to
BSEE pursuant to Sec. 285.110;
* * * * *
0
13. Revise Sec. 285.420 to read as follows:
Sec. 285.420 What effect does a suspension order have on my payments?
If BSEE orders a suspension, as provided in Sec. 285.417, BOEM may
waive or defer your payment obligations during the suspension. BOEM's
decision to waive or defer payments will depend on the reasons for the
suspension, including your responsibility for the circumstances
necessitating a suspension.
Subpart F--Information Requirements
0
14. Revise Sec. 285.602 to read as follows:
Sec. 285.602 What records must I maintain?
Until BOEM releases your financial assurance under 30 CFR 585.534,
you must maintain and provide to BSEE, upon request, all data and
information related to compliance with the required terms and
conditions of your lease, grant, reports submitted under this part and
approved plans.
0
15. Amend Sec. 285.614 by revising paragraph (b) to read as follows:
Sec. 285.614 When may I begin conducting activities under my approved
SAP?
* * * * *
(b) If you are installing a facility or a combination of facilities
deemed by BOEM to be complex or significant, as provided in 30 CFR
585.613(a)(1), you must comply with the requirements of subpart G of
this part and submit the Safety Management System (SMS) description
required by Sec. 285.810 before construction may begin.
0
16. Revise Sec. 285.637 to read as follows:
Sec. 285.637 When may I commence commercial operations on my
commercial lease?
(a) If you are conducting activities on your lease that do not
require a FERC license (i.e., wind power projects), then you may
commence commercial operations after:
(1) You submit information consistent with Sec. 285.702(c) and (d)
for facilities installed prior to commencing commercial operations;
(2) Your CVA submits the project verification report, as described
in Sec. 285.708(a)(5), including information required by Sec.
285.708(b)(1), or interim report(s), as described in Sec. 285.712(a)
for facilities installed prior to commencing commercial operations;
(3) Your CVA submits the Critical Safety Systems and Equipment
commissioning records, as described in Sec. 285.708(a)(6) or interim
report(s), as described in Sec. 285.712(a), for facilities installed
prior to commencing commercial operations; and
(4) BSEE has not notified you of any objections to the submittals
in paragraphs (a)(1) and (3) of this section within the timeframes in
Sec. Sec. 285.700(d) and 285.712(a), as applicable. You may continue
commercial operations while BSEE reviews your submittals.
(b) To continue commercial operations as additional facilities
complete commissioning, you must submit information in paragraphs
(a)(1) and (3) of this section for facilities installed after
commercial operations have commenced.
(c) You must notify BSEE within 10 business days after you commence
commercial operations.
0
17. Amend Sec. 285.638 by revising the first sentence of paragraph (a)
to read as follows:
Sec. 285.638 What must I do upon completion of my commercial
operations as approved in my COP or FERC license?
(a) Upon completion of your approved activities under your COP, you
must decommission your project as set forth in subpart I of this part.
* * *
* * * * *
Subpart G--Facility Design, Fabrication, and Installation
0
18. Revise Sec. 285.700 to read as follows:
Sec. 285.700 What reports must I submit to BSEE before installing
facilities described in my approved SAP, COP, or GAP?
(a) You must submit the following reports to BSEE before installing
facilities described in your approved COP (30 CFR 585.632(a)) and, when
required by 30 CFR part 585, in your approved SAP (30 CFR 585.614(b))
or GAP (30 CFR 585.651):
(1) A Facility Design Report (FDR); and
(2) A Fabrication and Installation Report (FIR).
(b) You may submit separate FDRs and FIRs for integrated asset
packages unless otherwise agreed to by BSEE (e.g., wind turbine
generator (WTG), offshore substation/electrical service platform, array
cables, export cables, and seabed preparation). If you submit separate
FDRs and FIRs by integrated asset packages, you must:
(1) Ensure FDR(s) and FIR(s) for integrated asset package(s) are
complete (e.g., the WTG package includes the RNA, blades, tower,
foundation, and transition piece, if applicable);
(2) Explain to BSEE how all FDR(s) and FIR(s) for integrated asset
packages will function together effectively in an integrated manner in
accordance with your project design; and
(3) Demonstrate that such integration has been verified by your
CVA.
(c) You may submit your FDRs and FIRs before or after SAP, COP, or
GAP approval.
(d) Subject to the requirements in paragraph (b) of this section,
you may commence fabrication and installation of the facilities on the
OCS as described in each report:
(1) If BSEE deems your report submitted before SAP, COP, or GAP
approval and notifies you of its non-objection to the FDR and FIR or
does not respond with objections within 60 business days of SAP, COP,
or GAP approval; or
(2) If BSEE deems your report submitted after SAP, COP, or GAP
approval and notifies you of its non-objection to the FDR and FIR or
does not respond with objections within 60 business days of the report
being deemed submitted.
(e) You may commence procurement of discrete parts of the project
that are commercially available in standardized form and type-certified
components, or fabrication activities that do not take place on the OCS
(e.g., manufacturing), prior to the submittal of the reports required
under paragraph (a) of this section or any plans required under 30 CFR
parts 585 and 586. The procurement and fabrication of facility
components allowed under this section are subject to verification and
certification by your CVA, and BSEE may object to the installation of
said components on the OCS if it considers that the components or their
fabrication are inconsistent with accepted industry or engineering
standards, the approved SAP, COP, or GAP, the FDR or FIR, or BSEE's
regulations.
(f) If BSEE has objections, we will notify you in writing within 60
business days of the report being deemed submitted. Following initial
notification of any objections, BSEE may follow up with written
correspondence detailing its objections to the report and requesting
that certain actions be undertaken. You cannot commence fabrication or
installation activities on the OCS that are addressed in such reports
until you resolve all objections to BSEE's satisfaction.
0
19. Amend Sec. 285.701 by:
0
a. Revising paragraphs (a)(1) through (10);
[[Page 42716]]
0
b. Adding paragraphs (a)(11) through (13);
0
c. Revising paragraphs (b), (c), and (d); and
0
d. Removing paragraph (e).
The revisions and additions read as follows:
Sec. 285.701 What must I include in my Facility Design Report?
(a) * * *
------------------------------------------------------------------------
Required documents Required contents
------------------------------------------------------------------------
(1) Cover letter............. (i) Proposed facility designations:
(ii) Lease, ROW grant or RUE grant
number;
(iii) Area; name and block numbers; and
(iv) The type of facility.
(2) Location plat............ (i) Latitude and longitude coordinates,
Universal Mercator grid-system
coordinates, State plane coordinates in
the Lambert or Transverse Mercator
Projection System;
(ii) Distances in feet from the nearest
block lines. These coordinates must be
based on the NAD (North American Datum)
83 datum plane coordinate system; and
(iii) The location of any project
easements.
(3) Front, Side, and Plan (i) Facility dimensions and orientation;
View drawings. (ii) Elevations relative to Mean Lower
Low Water; and
(iii) Pile sizes and penetration.
(4) Complete set of The approved for construction fabrication
structural drawings. drawings should be submitted including,
e.g.,
(i) Cathodic protections systems;
(ii) Jacket design;
(iii) Pile foundations;
(iv) Mooring, tendon and tethering
systems;
(v) Foundations and anchoring systems;
and
(vi) Associated cable and pipeline
designs.
(5) Summary of environmental A summary of the environmental data used
data used for design. in the design or analysis of the
facility. Examples of relevant data
include information on:
(i) Extreme weather;
(ii) Seafloor conditions; and
(iii) Waves, wind, current, tides,
temperature, snow and ice effects,
marine growth, and water depth.
(6) Summary of the (i) Loading information (e.g., live,
engineering design data. dead, environmental);
(ii) Structural information (e.g., design-
life; material types; cathodic
protection systems; design criteria;
fatigue life; jacket design; deck
design; production component design;
foundation pilings and templates, and
mooring, tethering or tendon systems;
fabrication and installation
guidelines);
(iii) Location of foundation boreholes
and foundation piles;
(iv) Foundation information (e.g., soil
stability, design criteria); and
(v) For a floating facility, structural
integrity, stability, and ballast
information. This includes foundations,
piles, templates, anchors or anchor
systems, mooring, tethering and tendon
systems.
(7) A complete set of design Self-explanatory.
calculations.
(8) Project-specific studies All studies pertinent to facility design
used in the facility design or installation, e.g., oceanographic and
or installation. soil reports including the results of
the survey required in 30 CFR
585.610(b), 585.626(b), or 585.645(b).
(9) Description of the loads (i) Loads imposed by the jacket;
imposed on the facility. (ii) Decks;
(iii) Production components;
(iv) Foundations, foundation pilings and
templates, and anchoring systems; and
(v) Mooring, tendon or tethering systems.
(10) Geotechnical reports.... Reports and supporting data from
geotechnical surveys, in situ
explorations, laboratory tests,
analyses, burial or drivability
assessments, and recommended design
parameters.
(11) Design Standards........ The industry standards you will apply to
ensure the facilities are designed to
meet Sec. 285.105.
(12) Critical Safety Systems A risk assessment that identifies the
and Equipment. Critical Safety Systems and Equipment
and a description of the identified
Critical Safety System and Equipment.
(13) Other information....... Additional information required by BSEE.
------------------------------------------------------------------------
(b) For any floating facility, your design must meet the
requirements of the U.S. Coast Guard for structural integrity and
stability (e.g., verification of center of gravity) as listed in
paragraph (a)(6)(v) of this section. The design must also consider:
(1) Foundations, foundation pilings and templates, and anchoring
systems; and
(2) Mooring, tendon, or tethering systems.
(c) You must submit your FDR to BSEE pursuant to Sec. 285.110 and
provide the location of records, as required in Sec. 285.714(c).
(d) If you are required to use a CVA, the FDR must include the
following certification statement with accompanying justification:
``The design of this structure has been certified by a BSEE-approved
CVA to be in accordance with accepted engineering practices and the
approved SAP, GAP, or COP, as applicable, and has been designed to
provide for safety. The certified design and as-built plans and
specifications will be on file at [provide location].''
0
20. Amend Sec. 285.702 by:
0
a. Revising paragraphs (a)(1) through (7);
0
b. Adding paragraphs (a)(8) through (10);
0
c. Removing paragraph (d);
0
d. Redesignating paragraphs (b) and (c) as paragraphs (c) and (d),
respectively;
0
e. Adding new paragraph (b); and
0
f. Revising newly redesignated paragraph (d).
The revisions and additions read as follows:
[[Page 42717]]
Sec. 285.702 What must I include in my Fabrication and Installation
Report?
(a) * * *
------------------------------------------------------------------------
Required documents Required contents
------------------------------------------------------------------------
(1) Cover letter............. (i) Proposed facility designation, lease,
ROW grant, or RUE grant number;
(ii) Area, name, and block number; and
(iii) The type of facility.
(2) Schedule................. Fabrication and installation schedule
information.
(3) Fabrication information.. The industry standards you will use to
ensure the facilities are fabricated to
the design criteria identified in your
Facility Design Report.
(4) Installation process Details associated with the deployment
information. activities, equipment, and materials,
including onshore and offshore equipment
and support, and anchoring and mooring
patterns.
(5) Federal, State, and local Either one copy of the permit or
permits (e.g., EPA, Army information on the status of the
Corps of Engineers). application.
(6) Quality assurance........ Certificates ensuring adherence to a
nationally or internationally recognized
quality assurance standard. Alternate
means of compliance must be approved on
a case-by-case basis.
(7) Environmental information Information about:
(i) Water discharge;
(ii) Waste disposal;
(iii) Vessel information;
(iv) Onshore waste receiving treatment or
disposal facilities; and
(v) If you submitted this data as part of
your SAP, COP, or GAP, you may
incorporate the information by
reference.
(8) Commissioning procedures Original equipment manufacturer
for Critical Safety Systems procedures or other BSEE accepted
and Equipment. engineering practices for commissioning
of Critical Safety Systems and Equipment
as identified in Sec. 285.701(a)(12).
(9) Project easement......... Information about installation of any
cables, pipelines, or facilities.
Information on burial methods and
vessels.
(10) Other information....... Additional information required by BSEE.
------------------------------------------------------------------------
(b) You must submit your FIR to BSEE pursuant to Sec. 285.110.
* * * * *
(d) If you are required to use a CVA, the FIR must include the
following certification statement with accompanying justification:
``The fabrication and installation of this structure has been certified
by a BSEE-approved CVA to be in accordance with accepted engineering
practices, the FDR, and the approved SAP, GAP, or COP, as applicable.
The certified design and as-built plans and specifications will be on
file at [provide location].''
0
21. Amend Sec. 285.703 by revising paragraphs (a) and (c) to read as
follows:
Sec. 285.703 What reports must I submit for project modifications and
repairs?
(a) You must submit a Project Modification or Repair Report to BSEE
in which you certify that major repairs and major modifications of
renewable energy structures and crucial components to a completed
project conform to accepted engineering practices.
(1) A ``major repair'' is a corrective action involving structural
members affecting the structural integrity of all or a portion of the
facility or substantial repair of a Critical Safety Systems and
Equipment, including those identified in your FDR.
(2) A ``major modification'' is an alteration involving structural
members affecting the structural integrity of all or a portion of the
facility or substantial alteration of Critical Safety Systems and
Equipment, including those as identified in your FDR.
* * * * *
(c) If you are required to use a CVA, the report described in
paragraph (a) of this section must include the following certification
statement with accompanying justification: ``The [major modification or
major repair] of this [structure or Critical Safety Systems and
Equipment] has been certified by a BSEE-approved CVA to be in
accordance with accepted engineering practices, the FDR, and the
approved SAP, GAP, or COP as applicable.''
0
22. Add Sec. 285.704 to read as follows:
Sec. 285.704 After receiving the FDR, FIR, or project verification
reports, what will BSEE do?
(a) Determine whether the report is deemed submitted. Within 20
business days after receiving your proposed FDR, FIR, or project
verification report, BSEE will review your submission. BSEE will deem
your FDR, FIR, or project verification report submitted if BSEE
determines it is sufficiently complete and accurate to fulfill the
applicable requirements of Sec. 285.701, Sec. 285.702, or Sec.
285.712.
(b) Identify problems and deficiencies. If BSEE determines that
your submission has not met the conditions in paragraph (a) of this
section, BSEE will notify you of the problem or deficiency within 20
business days after BSEE receives your FDR, FIR, or project
verification report. BSEE will not deem your FDR, FIR, or project
verification report submitted until you have corrected all problems or
deficiencies identified in the notice.
(c) Notify you when the report is deemed submitted. BSEE will
notify you when the FDR, FIR, or project verification reports are
deemed submitted. If BSEE has not notified you within 20 business days
that your report has problems or deficiencies, it is deemed submitted.
Until your report is deemed submitted, the time period in Sec.
285.700(d) does not begin running.
0
23. Revise Sec. 285.705 to read as follows:
Sec. 285.705 When must I use a Certified Verification Agent (CVA)?
(a) Unless BSEE waives this requirement under paragraph (c) of this
section, you must use one or more CVAs to review and verify your FDRs,
FIRs, and the Project Modification and Repair Reports.
(b) The purpose of a CVA is to:
(1) Ensure that your facilities are designed, fabricated, and
installed in conformance with accepted engineering practices and the
FDR(s) and FIR(s); and that the design of the facilities is suitable
for the location where they will be installed;
(2) Ensure Critical Safety Systems and Equipment are commissioned
in
[[Page 42718]]
accordance with the procedures identified in Sec. 285.702(a)(8);
(3) Ensure that major repairs and major modifications are completed
in conformance with accepted engineering practices; and
(4) Provide BSEE and you with reports of all incidents that affect
the facility design, fabrication, and installation, including
commissioning of Critical Safety Systems and Equipment, for the project
and its components.
(c) BSEE may waive in whole or in part the requirement that you use
a CVA if you can demonstrate the following:
------------------------------------------------------------------------
Then BSEE may waive the
If you demonstrate that . . . requirement for a CVA for
the following:
------------------------------------------------------------------------
(1) The facility design conforms to a The design of your
standard design that has been used structure(s).
successfully in a similar environment, and
the installation design conforms to accepted
engineering practices.
(2) The relevant fabricator has successfully The fabrication of your
fabricated similar facilities, and the structure(s).
facility will be fabricated in conformance
with accepted engineering practices and to a
nationally or internationally recognized
quality assurance standard.
(3) The installation company has successfully The installation of your
installed similar facilities in a similar structure(s).
offshore environment, and your structures
will be installed in conformance with
accepted engineering practices.
(4) Major repairs or major modifications will The major repair or major
be completed in conformance with accepted modification on your
engineering practices and to a nationally or structure(s).
internationally recognized quality assurance
standard.
------------------------------------------------------------------------
(d) You must submit a request to waive, in whole or in part, the
requirement to use a CVA to BSEE in writing.
(1) BSEE will review your request to waive, in whole or in part,
the use of the CVA and notify you of its decision.
(2) If BSEE does not waive, in whole or in part, the requirement
for a CVA, you may file an appeal under Sec. 285.118.
(3) If BSEE waives, in whole or in part, the requirement that you
use a CVA, your project engineer must perform the same duties and
responsibilities as would have the CVA, except as otherwise provided.
You must submit the project engineer's qualifications to BSEE as a part
of your waiver request to demonstrate that your project engineer is a
professional engineer with relevant experience and expertise in the
facilities they will be verifying/certifying.
0
24. Amend Sec. 285.706 by:
0
a. Revising paragraphs (a), (b)(2) and (7), (c), and (d);
0
b. Removing paragraph (e); and
0
c. Redesignating paragraph (f) as paragraph (e).
The revisions read as follows:
Sec. 285.706 How do I nominate a CVA for BSEE approval?
(a) A CVA must be nominated by the lessee and approved by BSEE
before conducting any verification or certification activities for
which they have been nominated. If you intend to use multiple CVAs, you
must nominate a general project CVA who will manage the overall project
verification and certification approach and who will ensure consistency
and oversight among the CVAs, especially in transition areas between
different CVAs. The general project CVA must be nominated no later than
COP submission.
(b) * * *
(2) Technical capabilities of the individual or the primary staff
for the specific project, including relevant professional licenses,
certifications, and accreditations;
* * * * *
(7) The scope and level of work to be performed by the CVA,
including all relevant reports and facilities that the CVA will verify
or certify.
(c) Individuals or organizations acting as CVAs must not function
in any capacity that will create a conflict of interest or the
appearance of a conflict of interest. The CVA must not have prepared,
or been directly involved in, any work related to the preparation of
design, fabrication, installation, modification, or repair plans for
which they will provide verification or certification services.
(d) The verification and certification must be conducted by or
under the direct supervision of a registered professional engineer.
* * * * *
0
25. Amend Sec. 285.707 by:
0
a. Revising the second sentence of paragraph (a);
0
b. Removing ``and'' from paragraph (b)(8);
0
c. Redesignating paragraph (b)(9) as paragraph (b)(10);
0
d. Adding new paragraph (b)(9); and
0
e. Revising paragraph (c).
The revisions and addition read as follows:
Sec. 285.707 What are the CVA's primary duties for facility design
review?
(a) * * * The CVA must verify to BSEE that the facility is designed
to withstand the environmental and functional load conditions
appropriate for the intended service life at the proposed location and
has been designed to minimize risk to personnel as required by Sec.
285.105(a).
(b) * * *
(9) Risk assessments supporting the design for human safety and how
the results are used in the design; and
* * * * *
(c) For any floating facility, the CVA or project engineer must
also verify that any requirements of the U.S. Coast Guard for
structural integrity and stability (e.g., verification of center of
gravity), have been met. The CVA must also consider:
(1) Foundations, foundation pilings and templates, and anchoring
systems; and
(2) Mooring, tendon or tethering systems.
0
26. Revise Sec. 285.708 to read as follows:
Sec. 285.708 What are the CVA's or project engineer's primary duties
for fabrication and installation review?
(a) The CVA or project engineer must do all of the following:
(1) Use good engineering judgment and practice in conducting an
independent assessment of the fabrication and installation activities
and of the commissioning of Critical Safety Systems and Equipment;
(2) Monitor the fabrication and installation of the facility and
the commissioning of Critical Safety Systems and Equipment as required
by paragraph (b) of this section;
(3) Make periodic onsite inspections while fabrication is in
progress and verify the items required by Sec. 285.709;
(4) Make periodic onsite inspections while installation is in
progress and satisfy the requirements of Sec. 285.710;
(5) Certify in Project Verification Reports that project components
are fabricated and installed in accordance with accepted engineering
practices and to a nationally or internationally recognized quality
assurance standard
[[Page 42719]]
or to an equivalent alternate means of quality assurance considered on
a case-by-case basis, your BOEM-approved SAP, COP, or GAP (as
applicable), and your FIR. If multiple CVAs are involved in your
project, the general project CVA must submit the final report
containing such certification for the project. The Project Verification
Report must identify the location of all records pertaining to facility
fabrication and installation as required in Sec. 285.714(c);
(6) Provide records documenting that Critical Safety Systems and
Equipment are commissioned in accordance with the procedures identified
in Sec. 285.702(a)(8); and
(7) Identify the location of all records pertaining to
commissioning of Critical Safety Systems and Equipment, as required in
Sec. 285.714(c).
(b) To comply with paragraphs (a)(4) and (5) of this section, the
CVA or project engineer must monitor the fabrication and installation
of the facility and the commissioning of Critical Safety Systems and
Equipment to certify that they have been built and installed according
to your FDRs and FIRs.
(1) If the CVA or project engineer finds that either fabrication
and installation procedures or Critical Safety Systems and Equipment
commissioning procedures, or both, have been changed or design
specifications have been modified, the CVA or project engineer must
inform you and BSEE; and
(2) If you accept the modifications, you must also inform BSEE.
0
27. Revise Sec. 285.709 to read as follows:
Sec. 285.709 When conducting onsite fabrication inspections, what
must the CVA or project engineer verify?
(a) To comply with Sec. 285.708(a)(3), the CVA or project engineer
must make periodic onsite inspections while fabrication is in progress
and must verify the following fabrication items, as appropriate:
(1) Quality control by lessee (or grant holder) and builder;
(2) Fabrication site facilities;
(3) Material quality and identification methods;
(4) Fabrication procedures specified in your FIRs and adherence to
such procedures;
(5) Welder and welding procedure qualification and identification;
(6) Structural tolerances specified, and adherence to those
tolerances;
(7) Nondestructive examination requirements and evaluation results
of the specified examinations;
(8) Destructive testing requirements and results;
(9) Repair procedures;
(10) Installation of corrosion-protection systems and splash-zone
protection;
(11) Erection procedures to ensure that overstressing of structural
members does not occur;
(12) Alignment procedures;
(13) Dimensional check of the overall structure, including any
turrets, turret-and-hull interfaces, any mooring line and chain and
riser tensioning line segments, and tendon or tethering systems; and
(14) Status of quality-control records at various stages of
fabrication.
(b) For any floating facility, the CVA or project engineer must
also verify that any requirements of the U.S. Coast Guard for
structural integrity and stability (e.g., verification of center of
gravity) have been met. The CVA or project engineer must also consider:
(1) Foundations, foundation pilings and templates, and anchoring
systems; and
(2) Mooring, tendon, or tethering systems.
0
28. Revise Sec. 285.710 to read as follows:
Sec. 285.710 When conducting onsite installation inspections, what
must the CVA or project engineer do?
(a) To comply with Sec. 285.708(a)(4), the CVA or project engineer
must make periodic onsite inspections while installation is in progress
and must, as appropriate, verify, witness, survey, or check the
installation and commissioning of items required by this section.
(b) The CVA or project engineer must verify, as appropriate, all of
the following:
(1) Loadout and initial flotation procedures;
(2) Towing operation procedures to the specified location,
including a review of the towing records;
(3) Launching and uprighting activities;
(4) Submergence activities;
(5) Pile or anchor installations;
(6) Installation of mooring, tendon, and tethering systems;
(7) Final deck and component installations;
(8) Installation at the locations set forth in your FDR(s) and
FIR(s); and
(9) Commissioning of Critical Safety Systems and Equipment.
(c) For a fixed or floating facility, the CVA or project engineer
must verify that proper procedures were used during the following:
(1) The loadout of the jacket, decks, piles, or structures from
each fabrication site;
(2) The actual installation of the facility or major modification
and the related installation activities; and
(3) Commissioning of Critical Safety Systems and Equipment.
(d) For a floating facility, the CVA or project engineer must
verify structural integrity, stability, and ballast, and that proper
procedures were used during the following:
(1) The loadout of the facility;
(2) The installation of foundation pilings and templates, and
anchoring systems; and
(3) The installation of the mooring and tethering and tendon
systems.
(e) The CVA or project engineer must conduct an onsite inspection
of the installed facility as approved in your CVA scope of work.
(f) The CVA or project engineer must make periodic onsite
inspections to witness the commissioning of Critical Safety Systems and
Equipment in order to verify that:
(1) The Critical Safety Systems and Equipment function as designed;
and
(2) The final commissioning Critical Safety Systems and Equipment
records are complete.
(g) The CVA or project engineer must spot-check the equipment,
procedures, and recordkeeping as necessary to determine compliance with
the applicable documents incorporated by reference and the regulations
under this part.
0
29. Amend Sec. 285.712 by:
0
a. Revising paragraph (a) and the first sentence of paragraph (b)
introductory text;
0
c. Removing ``and'' at the end of paragraph (b)(3);
0
d. Removing the period at the end of paragraph (b)(4) and adding in its
place ``; and''; and
0
e. Adding paragraph (b)(5).
The revisions and addition read as follows:
Sec. 285.712 What are the CVA's or project engineer's reporting
requirements?
(a) The CVA or project engineer must prepare and submit to you and
BSEE all reports and records required by this subpart. The CVA or
project engineer must also submit interim reports to you and BSEE, as
requested by BSEE. BSEE will review and respond within 30 days.
(b) For each report required by this subpart, the CVA or project
engineer must submit the final report to BSEE pursuant to Sec.
285.110. * * *
* * * * *
(5) Summarize any issues with the design and any incidents during
facility fabrication and installation, or Critical Safety System and
Equipment commissioning, and how those issues were resolved.
[[Page 42720]]
Sec. 285.713 [Removed and Reserved]
0
30. Remove and reserve Sec. 285.713.
0
31. Amend Sec. 285.714 by:
0
a. Revising the section heading;
0
b. Redesignating paragraphs (a)(4) and (5) as paragraphs (a)(5) and
(6), respectively;
0
c. Adding new paragraph (a)(4); and
0
d. Revising paragraph (c).
The revisions and addition read as follows:
Sec. 285.714 What records relating to FDRs, FIRs, and Project
Modification and Repair Reports must I keep?
(a) * * *
(4) The records of the commissioning of Critical Safety Systems and
Equipment;
* * * * *
(c) You must provide BSEE with the location of these records, as
required in Sec. Sec. 285.701(c) and (d), 285.702(c) and (d),
285.703(b), and 285.708(a)(5) and (7).
Subpart H--Environmental and Safety Management, Inspections, and
Facility Assessments for Activities Conducted Under SAPS, COPS, and
GAPs
0
32. Revise Sec. 285.810 to read as follows:
Sec. 285.810 When must I submit a Safety Management System (SMS) and
what must I include in my SMS?
You are required to use a Safety Management System (SMS) for
activities conducted on the OCS to develop or operate a lease, from met
buoy placement and site assessment work through decommissioning, and to
provide your SMS to BSEE upon request. You must also submit a detailed
description of the SMS with your COP (as provided in 30 CFR 585.627(d))
and, when required by this part, your SAP (as provided in Sec.
285.614(b)) or GAP (as provided in Sec. 285.651). Your SMS must
address:
(a) How you will ensure the safety of your personnel or anyone else
on or near your facilities, such as:
(1) Health and safety risks that anyone on your facilities or
engaged in lease activities are likely to face during activities
covered by the SMS;
(2) Policies and strategies that will be used to control such
risks;
(3) Procedures and nationally or internationally recognized
standards that will be followed to ensure the safety of the activities
covered by the SMS;
(4) Methods that will be used to monitor the implementation of the
SMS and maintain the safety of activities covered by the SMS, including
management of change and stop work practices; and
(5) Procedures for personnel to report unsafe work conditions both
to the lessee or its designated operator and to BSEE.
(b) Remote monitoring, control, and shut down capabilities, such
as:
(1) Aspects of operations and mechanical and structural integrity
that will be monitored remotely;
(2) Circumstances under which remote monitoring will be activated
and how it will be maintained;
(3) Maintenance of the security of the remote sensing and control
capabilities;
(4) Monitoring of conditions if remote sensing equipment fails; and
(5) Conditions that will result in the shutdown of one or more
facilities.
(c) Emergency response procedures, such as:
(1) Types of incidents to be addressed (e.g., serious injury to
workers during maintenance, unexploded ordnance encountered during
construction, damage due to hurricane or allision by vessels or
aircraft, unauthorized access into remote monitoring capabilities,
evacuation, and search and rescue);
(2) Potential response activities, including U.S. Coast Guard
(USCG), other government agencies, and contractor support, for each
category of incident;
(3) Management controls, authorities, and reporting to be employed
for each response;
(4) Locations from which emergency response will be controlled; and
(5) Resources available to assist in the response.
(d) Fire suppression equipment, such as a description of how and
when it will be used, if needed.
(e) How and when you will test your SMS, such as:
(1) Plans, processes, and schedules for:
(i) Self or third-party auditing of the SMS; and
(ii) Regular testing of certain SMS components, including remote
shutdown capabilities and emergency response readiness; and
(2) Corrective action processes to improve the effectiveness of
your SMS based on the results of audits, tests, investigations of
incidents (including near-misses), feedback from the field, and other
information sources.
(f) How you will ensure personnel who conduct activities on your
facilities are properly trained and have the capability to safely
perform duties, such as:
(1) Required training for personnel who conduct activities on your
facilities; and
(2) Required knowledge and skills to ensure that personnel perform
duties safely for the duration of activities.
0
33. Revise Sec. 285.811 to read as follows:
Sec. 285.811 Am I required to obtain a certification of my SMS?
You are not required to obtain a certification that your SMS meets
acceptable health and safety standards (e.g., ANSI/ASSP Z10.0, API RP
75, ISO 45001) from a recognized accreditation organization. However,
BSEE will consider such certification in determining the frequency and
scope of SMS-related inspections that it conducts under this subpart,
as well as the scope and nature of its oversight over any audit-induced
corrective actions.
0
34. Add Sec. 285.812 to read as follows:
Sec. 285.812 How must I implement my SMS?
(a) Your SMS must be functional before you begin, and must remain
functional while you perform, any activity on the OCS pursuant to a
lease, including met buoy placement and site assessment work, or for
any activities described in your approved SAP, COP, or GAP. You must
conduct all activities described in your approved SAP, COP, or GAP in
accordance with the SMS you described under Sec. 285.810.
(b) You must regularly demonstrate to BSEE that your SMS is being
implemented effectively by submitting the following to BSEE in
accordance with Sec. 285.110:
(1) By March 31st of each year, summarize safety and work hour
performance data for the prior calendar year in which you conducted
site assessment, construction, operations, or decommissioning
activities in accordance with your lease terms, using a form available
on the BSEE website; and
(2) Once every 3 years and upon BSEE's request, provide a report to
BSEE summarizing the results of your most recent SMS audit, corrective
actions implemented or being implemented as a result of that audit, and
an updated description of your SMS highlighting changes that were made
since the last such submission to BSEE.
0
35. Amend Sec. 285.815 by revising the second sentence of paragraph
(a) to read as follows:
Sec. 285.815 What must I do if I have facility damage or an equipment
failure?
(a) * * * If you have a major repair, you must submit a report to
BSEE under Sec. 285.703.
* * * * *
0
36. Revise Sec. 285.820 to read as follows:
[[Page 42721]]
Sec. 285.820 Will BSEE conduct inspections?
BSEE may inspect OCS facilities and any vessels engaged in
activities authorized under this part. When we conduct these
inspections, we will:
(a) Verify that you are conducting activities in compliance with
subsection 8(p) of the OCS Lands Act; the regulations in this part; the
terms, conditions, and stipulations of your lease or grant; approved
plans; and other applicable laws and regulations.
(b) Determine whether proper safety equipment has been installed
and is operating properly according to your SMS, as required in Sec.
285.810.
0
37. Revise Sec. 285.821 to read as follows:
Sec. 285.821 Will BSEE conduct scheduled and unscheduled inspections?
BSEE may conduct both scheduled and unscheduled inspections.
0
38. Amend Sec. 285.822 by revising paragraphs (a)(1) and (b) to read
as follows:
Sec. 285.822 What must I do when BSEE conducts an inspection?
(a) * * *
(1) Provide access to all facilities on your lease (including your
project easement) or grant and any vessels engaged in activities
authorized under this part; and
* * * * *
(b) You must retain the records referenced in paragraph (a)(2)(iii)
of this section until BOEM releases your financial assurance under 30
CFR585.534 and provide them to BSEE upon request within the time period
specified by BSEE.
* * * * *
0
39. Revise Sec. 285.824 as follows:
Sec. 285.824 How must I conduct self-inspections?
(a) You must develop a comprehensive self-inspection plan covering
all of your facilities. You must keep this self-inspection plan
wherever you keep your records and make it available to BSEE upon
request. Your self-inspection plan must specify:
(1) The type, extent, and frequency of inspections that you will
conduct for both the above-water and the below-water structures of all
facilities and pertinent components of the mooring, tendon, or
tethering systems for any floating facilities;
(2) How you will monitor the corrosion protections for both above-
water and below-water structures; and
(3) How you will fulfill the requirement for annual on-site
inspection of all Critical Safety Systems and Equipment.
(b) You must conduct an onsite inspection of each of your
facilities at least once a year. This inspection must include, but is
not limited to, all Critical Safety Systems and Equipment.
(1) You must develop and retain summary reports for all such
inspections for each calendar year. The summary report must note any
failures of operability, required maintenance of Critical Safety
Systems and Equipment, or required replacement of the Critical Safety
Systems and Equipment identified during inspection.
(2) You must retain records of inspections and summary reports for
the previous 2 calendar years and make them available to BSEE on
request.
(c) You must submit a report annually to BSEE no later than
November 1st that must include:
(1) A list of facilities inspected for structural condition and
corrosion protection in the preceding 12 months;
(2) The type of inspection employed (i.e., visual, magnetic
particle, ultrasonic testing); and
(3) A summary of the inspection indicating what repairs, if any,
were needed and the overall structural condition of the facility.
0
40. Amend Sec. 285.830 by revising paragraph (d) to read as follows
Sec. 285.830 What are my incident reporting requirements?
* * * * *
(d) You must report all spills of oil or other liquid pollutants in
accordance with 30 CFR 250.187(d).
Subpart I--Decommissioning
0
41. Amend Sec. 285.900 by adding paragraph (c) to read as follows:
Sec. 285.900 Who must meet the decommissioning obligations in this
subpart?
* * * * *
(c) If a lessee or grant holder has installed a facility on a lease
or grant that was authorized by an authority other than BOEM and that
approving authority has imposed a decommissioning obligation, such
obligation will substitute for the requirements of this subpart. The
decommissioning requirements in this subpart will apply to such a
facility if the authorizing agency has not imposed or enforced a
decommissioning obligation.
0
42. Amend Sec. 285.902 by revising the introductory text of paragraph
(a) to read as follows:
Sec. 285.902 What are the general requirements for decommissioning
for facilities authorized under my SAP, COP, or GAP?
(a) Except as otherwise authorized under Sec. 285.909, within 2
years following termination of a lease or grant, or earlier if BSEE
determines a facility is no longer useful for operations, you must:
* * * * *
0
43. Amend Sec. 285.905 by adding paragraph (e) to read as follows:
Sec. 285.905 When must I submit my decommissioning application?
* * * * *
(e) Ninety (90) calendar days after BSEE determines a facility is
no longer useful for operations.
PART 585--RENEWABLE ENERGY ON THE OUTER CONTINENTAL SHELF
0
44. The authority citation for part 585 continues to read as follows:
Authority: 43 U.S.C. 1337.
0
45. Revise subpart A to read as follows:
Subpart A--General Provisions
Sec.
585.100 Authority.
585.101 What is the purpose of this part?
585.102 What are BOEM's responsibilities under this part?
585.103 When may BOEM prescribe or approve departures from the
regulations in this part?
585.104 Do I need a BOEM lease or other authorization to produce or
support the production of electricity or other energy product from a
renewable energy resource on the OCS?
585.105 What are my responsibilities under this part?
585.106 What happens if I fail to comply with this part?
585.107 Who can acquire or hold a lease or grant under this part?
585.108 How do I show that I am qualified to be a lessee or grant
holder?
585.109 When must I notify BOEM if an action has been filed alleging
that I am insolvent or bankrupt?
585.110 When must I notify BOEM of mergers, name changes, or changes
of business form?
585.111 How do I submit plans, applications, reports, or notices
required by this part?
585.112 When and how does BOEM charge me processing fees on a case-
by-case basis?
585.113 Definitions.
585.114 How will data and information obtained by BOEM under this
part be disclosed to the public?
585.115 Paperwork Reduction Act statements--information collection.
585.116 Requests for information.
585.117 Severability.
[[Page 42722]]
585.118 What are my appeal rights?
585.119-585.149 [Reserved]
Subpart A--General Provisions
Sec. 585.100 Authority.
The authority for this part derives from section 8 of the Outer
Continental Shelf Lands Act (OCS Lands Act) (43 U.S.C. 1337). The
Secretary of the Interior delegated to the Bureau of Ocean Energy
Management (BOEM) the authority to manage the development of energy on
the Outer Continental Shelf (OCS) from sources other than oil and gas,
including renewable energy, through the issuance of leases, easements,
and right-of-way for activities that produce or support the production,
transportation, or transmission of energy.
Sec. 585.101 What is the purpose of this part?
The purpose of this part is to:
(a) Establish procedures for issuance and administration of leases,
right-of-way (ROW) grants, and right-of-use and easement (RUE) grants
for renewable energy production on the OCS;
(b) Inform you and third parties of your obligations when you
undertake activities authorized in this part; and
(c) Ensure that renewable energy activities on the OCS are
conducted in a safe and environmentally sound manner, in conformance
with the requirements of subsection 8(p) of the OCS Lands Act, other
applicable laws and regulations, and the terms of your lease, ROW
grant, or RUE grant.
(d) This part will not convey access rights for oil, gas, or other
minerals.
Sec. 585.102 What are BOEM's responsibilities under this part?
(a) BOEM will ensure that any activities authorized in this part
are carried out in a manner that provides for and reaches a rational
balance among the following goals to the extent they conflict or are
otherwise in tension, none of which inherently outweighs or supplants
any other:
(1) Safety;
(2) Protection of the environment;
(3) Prevention of waste, including economic waste and physical
waste of energy resources from sources other than oil and gas;
(4) Conservation of the natural resources of the OCS;
(5) Coordination with relevant Federal agencies (including, in
particular, those agencies involved in planning activities that are
undertaken to avoid conflicts among users and to maximize the economic
and ecological benefits of the OCS, including multifaceted spatial
planning efforts);
(6) Protection of national security interests of the United States;
(7) Protection of the rights of other authorized users of the OCS;
(8) A fair return to the United States;
(9) Prevention of interference with reasonable uses of the
exclusive economic zone, the high seas, and the territorial seas (as
determined by the Secretary);
(10) Consideration of the location of and any schedule relating to
a lease or grant under this part for an area of the OCS, and any other
use of the sea or seabed;
(11) Public notice and comment on any proposal submitted for a
lease or grant under this part; and
(12) Oversight, research, monitoring, and enforcement of activities
authorized by a lease or grant under this part.
(b) BOEM will require compliance with all applicable laws,
regulations, other requirements, and the terms of your lease or grant
and approved plans under this part. BOEM will approve, disapprove, or
approve with conditions any plans, applications, or other documents
submitted to BOEM for approval under the provisions of this part.
(c) Unless otherwise provided in this part, BOEM may give oral
directives or decisions whenever prior BOEM approval is required under
this part. BOEM will document in writing any such oral directives
within 10 business days.
(d) BOEM will establish practices and procedures to govern the
collection of all payments due to the Federal Government required under
the regulations of this part, including any cost recovery fees, rents,
operating fees, and other fees or payments. BOEM will do this in
accordance with the terms of this part, the leasing notice, the lease
or grant under this part, and applicable Office of Natural Resources
Revenue (ONRR) regulations or guidance.
(e) BOEM will provide for coordination and consultation with the
Governor of any State, the executive of any local government, and the
executive of any Indian Tribe that may be affected by a lease,
easement, or ROW under this section. BOEM may invite any affected State
Governor, representative of an affected Indian Tribe, and affected
local government executive to join in establishing a task force or
other joint planning or coordination agreement in carrying out our
responsibilities under this part.
Sec. 585.103 When may BOEM prescribe or approve departures from the
regulations in this part?
(a) BOEM may prescribe or approve departures from the provisions of
this part when BOEM deems the departure necessary because the
applicable provisions as applied to a specific circumstance:
(1) Are impractical or unduly burdensome and the departure is
necessary to achieve the intended objectives of the renewable energy
program;
(2) Fail to conserve the natural resources of the OCS;
(3) Fail to protect life (including human and wildlife), property,
or the marine, coastal, or human environment; or
(4) Fail to protect sites, structures, or objects of historical or
archaeological significance.
(b) Any departure approved under this section and its rationale
must:
(1) Be consistent with subsection 8(p) of the OCS Lands Act;
(2) Protect the environment and the public health and safety to the
same degree as if there was no approved departure from this part;
(3) Not impair the rights of third parties; and
(4) Be documented in writing.
Sec. 585.104 Do I need a BOEM lease or other authorization to produce
or support the production of electricity or other energy product from a
renewable energy resource on the OCS?
Except as otherwise authorized by law, it is unlawful for any
person to construct, operate, or maintain any facility to produce,
transport, or support generation of electricity or other energy product
derived from a renewable energy resource on any part of the OCS, except
in accordance with the terms of a lease, easement, or ROW issued under
the OCS Lands Act.
Sec. 585.105 What are my responsibilities under this part?
As a lessee, applicant, operator, or holder of a ROW or RUE grant,
you must:
(a) Design your projects and conduct all activities in a manner
that ensures safety and will not cause undue harm or damage to natural
resources, including their physical, atmospheric, and biological
components to the extent practicable; and take measures to prevent
unauthorized discharge of pollutants including marine trash and debris
into the offshore environment;
(b) Submit requests, applications, plans, notices, modifications,
and supplemental information to BOEM as required by this part;
(c) Follow up, in writing, any oral request or notification you
made, within 3 business days;
(d) Comply with all applicable laws and regulations, the terms of
your lease
[[Page 42723]]
or grant under this part, reports, notices, and approved plans prepared
under this part, and any conditions imposed by BOEM through its review
of any of these reports, notices, and approved plans, as provided in
this part;
(e) Make all applicable payments on time;
(f) Comply with the DOI's nonprocurement debarment regulations at 2
CFR part 1400;
(g) Include the requirement to comply with 2 CFR part 1400 in all
contracts and transactions related to a lease or grant under this part;
(h) Conduct all activities authorized by the lease or grant in a
manner consistent with the provisions of subsection 8(p) of the OCS
Lands Act;
(i) Compile, retain, and make available to BOEM representatives,
within the time specified by BOEM, any data and information related to
the site assessment, design, and operations of your project; and
(j) Respond to requests from the Director in a timely manner.
Sec. 585.106 What happens if I fail to comply with this part?
(a) BOEM may take appropriate corrective action under this part if
you fail to comply with applicable provisions of Federal law, the
regulations in this part, other applicable regulations, any order of
the Director, the provisions of a lease or grant issued under this
part, or the requirements of an approved plan or other approval under
this part.
(b) BOEM may issue to you a notice of noncompliance if we determine
that there has been a violation of the regulations in this part, any
order of the Director, or any provision of your lease, grant, or other
approval issued under this part. When issuing a notice of
noncompliance, BOEM will serve you at your last known address.
(c) A notice of noncompliance will tell you how you failed to
comply with this part, any order of the Director and/or the provisions
of your lease, grant or other approval, and will specify what you must
do to correct the noncompliance and the time limits within which you
must act.
(d) Failure of a lessee, operator, or grant holder to take the
actions specified in a notice of noncompliance issued under this part
within the time limit specified provides the basis for issuance of a
cessation order by BSEE, as provided in 30 CFR 285.401 and/or
cancellation of the lease or grant by the Secretary as provided in
Sec. 585.422.
(e) BOEM may assess civil penalties, as authorized by section 24 of
the OCS Lands Act and as determined under the procedures set forth in
30 CFR part 550, subpart N, if you fail to comply with any provision of
this part or any term of a lease, grant, or order issued under the
authority of this part:
(1) After notice of such failure and expiration of any reasonable
period allowed for corrective action; or
(2) BOEM determines that the failure constitutes, or constituted, a
threat of serious, irreparable, or immediate harm or damage to life
(including fish and other aquatic life), property, or the marine,
coastal, or human environment.
Sec. 585.107 Who can acquire or hold a lease or grant under this
part?
(a) You may acquire or hold a lease or grant under this part if you
can demonstrate that you have the technical and financial capabilities
to conduct the activities authorized by the lease or grant and you are
a(n):
(1) Citizen or national of the United States;
(2) Alien lawfully admitted for permanent residence in the United
States as defined in 8 U.S.C. 1101(a)(20);
(3) Private, public, or municipal corporations organized under the
laws of any State of the United States, the District of Columbia, or
any territory or insular possession subject to U.S. jurisdiction;
(4) Association of such citizens, nationals, resident aliens, or
corporations;
(5) Executive agency of the United States as defined in 5 U.S.C.
105;
(6) State of the United States; or
(7) Political subdivision of a State of the United States.
(b) You may not acquire or hold a lease or grant under this part or
acquire an interest in a lease or grant under this part if:
(1) You or your principals are excluded or disqualified from
participating in transactions covered by the Federal nonprocurement
debarment and suspension system (2 CFR part 1400), unless BOEM
explicitly has approved an exception for this transaction;
(2) BOEM determines or has previously determined after notice and
opportunity for a hearing that you or your principals have failed to
meet or exercise due diligence under any OCS lease or grant; or
(3) After written notice and your opportunity to be heard, BOEM
determines that:
(i) You no longer meet the qualification requirements for acquiring
or holding a lease or grant in paragraph (a) of this section.
(ii) You have:
(A) Violated an applicable law, regulation, order, lease or grant
provision, approved plan, or the prohibitions prescribed in a final
sale notice; or otherwise engaged in illegal activity, anti-competitive
or collusive behavior, fraud, or misrepresentation; and
(B) Failed to take timely remedial action as specified in the
written notice provided by BOEM of the basis for the disqualification.
(c) As long as a party is excluded or disqualified from acquiring
or holding a lease or grant under this part, it is also ineligible to
participate in BOEM's competitive and noncompetitive lease or grant
issuance processes, including auctions, conducted under this part, even
as an agent for another entity. A party can restore its eligibility by
completing the remedial action specified in the notice of the proposed
disqualification.
(d) You may share ownership interests in a lease with one or more
other persons, provided that all interest holders in the lease are
eligible to hold a lease pursuant to this section and Sec. 585.108.
Sec. 585.108 How do I show that I am qualified to be a lessee or
grant holder?
(a) You must demonstrate your technical and financial capability to
construct, operate, maintain, and terminate/decommission projects for
which you are requesting authorization. Documentation can include:
(1) Descriptions of international or domestic experience with
renewable energy projects or other types of electric-energy-related
projects; and
(2) Information establishing access to sufficient capital to carry
out development.
(b) An individual must submit a written statement of citizenship
status attesting to U.S. citizenship. It does not need to be notarized
nor give the age of individual. A resident alien may submit a photocopy
of the U.S. Citizenship and Immigration Services form issued by the
appropriate Federal immigration authority evidencing legal status as a
resident alien.
(c) A corporation or association must submit evidence, as specified
in the table in paragraph (d) of this section, acceptable to BOEM that:
(1) It is qualified to hold leases or grants under this part;
(2) It is authorized to conduct business under the laws of its
State;
(3) It is authorized to hold leases or grants on the OCS under the
operating rules of its business; and
(4) The persons holding the titles listed are authorized to bind
the corporation or association when conducting business with BOEM.
[[Page 42724]]
(d) Acceptable evidence under paragraph (c) of this section
includes, but is not limited to the following:
----------------------------------------------------------------------------------------------------------------
Requirements to qualify to hold leases or Ltd. Gen.
grants on the OCS: Corp. prtnsp. prtnsp. LLC Trust
----------------------------------------------------------------------------------------------------------------
(1) Original certificate or certified copy from XX ........... ........... ........... ...........
the State of incorporation stating the name of
the corporation exactly as it must appear on
all legal documents...........................
(2) Certified statement by Secretary/Assistant XX ........... ........... ........... ...........
Secretary over corporate seal, certifying that
the corporation is authorized to hold OCS
leases........................................
(3) Evidence of authority of titled positions XX ........... ........... ........... ...........
to bind corporation, certified by Secretary/
Assistant Secretary over corporate seal,
including the following:
(i) Certified copy of resolution of the ........... ........... ........... ........... ...........
board of directors with titles of officers
authorized to bind corporation............
(ii) Certified copy of resolutions granting ........... ........... ........... ........... ...........
corporate officer authority to issue a
power of attorney.........................
(iii) Certified copy of power of attorney ........... ........... ........... ........... ...........
or certified copy of resolution granting
power of attorney.........................
(4) Original certificate or certified copy of ........... XX XX XX ...........
partnership or organization paperwork
registering with the appropriate State
official......................................
(5) Copy of articles of partnership or ........... XX XX XX ...........
organization evidencing filing with
appropriate Secretary of State, certified by
Secretary/Assistant Secretary of partnership
or member or manager of LLC...................
(6) Original certificate or certified copy ........... XX XX XX ...........
evidencing State where partnership or LLC is
registered. Statement of authority to hold OCS
leases, certified by Secretary/Assistant
Secretary, OR original paperwork registering
with the appropriate State official...........
(7) Statements from each partner or LLC member ........... XX XX XX ...........
indicating the following:
(i) If a corporation or partnership, ........... ........... ........... ........... ...........
statement of State of organization and
authorization to hold OCS leases,
certified by Secretary/Assistant Secretary
over corporate seal, if a corporation.....
(ii) If an individual, a statement of ........... ........... ........... ........... ...........
citizenship...............................
(8) Statement from general partner, certified ........... XX ........... ........... ...........
by Secretary/Assistant Secretary that:
(i) Each individual limited partner is a ........... ........... ........... ........... ...........
U.S. citizen and;
(ii) Each corporate limited partner or ........... ........... ........... ........... ...........
other entity is incorporated or formed and
organized under the laws of a U.S. State
or territory..............................
(9) Evidence of authority to bind partnership ........... XX XX XX ...........
or LLC, if not specified in partnership
agreement, articles of organization, or LLC
regulations, i.e., certificates of authority
from Secretary/Assistant Secretary reflecting
authority of officers.........................
(10) Listing of members of LLC certified by ........... ........... ........... XX ...........
Secretary/Assistant Secretary or any member or
manager of LLC................................
(11) Copy of trust agreement or document ........... ........... ........... ........... XX
establishing the trust and all amendments,
properly certified by the trustee with
reference to where the original documents are
filed.........................................
(12) Statement indicating the law under which ........... ........... ........... ........... XX
the trust is established and that the trust is
authorized to hold OCS leases or grants.......
----------------------------------------------------------------------------------------------------------------
(e) A local, State, or Federal executive entity must submit a
written statement that:
(1) It is qualified to hold leases or grants under this part; and
(2) The person(s) acting on behalf of the entity is authorized to
bind the entity when conducting business with us.
(f) BOEM may require you to submit additional information at any
time considering your bid or request for a noncompetitive lease.
Sec. 585.109 When must I notify BOEM if an action has been filed
alleging that I am insolvent or bankrupt?
You must notify BOEM within 3 business days after you learn of any
action filed alleging that you are insolvent or bankrupt.
Sec. 585.110 When must I notify BOEM of mergers, name changes, or
changes of business form?
You must notify BOEM in writing of any merger, name change, or
change of business form. You must notify BOEM as soon as practicable
following the merger, name change, or change in business form, but no
later than 120 days after the earliest of either the effective date, or
the date of filing the change or action with the Secretary of the State
or other authorized official in the State of original registry.
Sec. 585.111 How do I submit plans, applications, reports, or notices
required by this part?
Unless otherwise stated, you must submit one electronic copy of all
plans, applications, reports, or notices required by this part to BOEM.
BOEM will inform you if it requires paper copies of specific documents.
Unless stated otherwise, documents should be submitted to the relevant
contacts listed on the BOEM website.
Sec. 585.112 When and how does BOEM charge me processing fees on a
case-by-case basis?
(a) BOEM will charge a processing fee on a case-by-case basis under
the procedures in this section with regard to any application or
request under this part if we decide at any time that the preparation
of a particular document or study is necessary for the application or
request and it will have a unique processing cost, such as the
preparation of an Environmental Assessment (EA) or Environmental Impact
Statement (EIS).
[[Page 42725]]
(1) Processing costs will include contract oversight and efforts to
review and approve documents prepared by contractors, whether the
contractor is paid directly by the applicant or through BOEM.
(2) We may apply a standard overhead rate to direct processing
costs.
(b) We will assess the ongoing processing fee for each individual
application or request according to the following procedures:
(1) Before we process your application or request, we will give you
a written estimate of the proposed fee based on reasonable processing
costs.
(2) You may comment on the proposed fee.
(3) You may:
(i) Ask for our approval to perform, or to directly pay a
contractor to perform, all or part of any document, study, or other
activity according to standards we specify, thereby reducing our costs
for processing your application or request; or
(ii) Ask to pay us to perform, or contract for, all or part of any
document, study, or other activity.
(4) We will then give you the final estimate of the processing fee
amount with payment terms and instructions after considering your
comments and any BOEM-approved work you will do.
(i) If we encounter higher or lower processing costs than
anticipated, we will re-estimate our reasonable processing costs
following the procedures in paragraphs (b)(1) through (4) of this
section, but we will not stop ongoing processing unless you do not pay
in accordance with paragraph (b)(5) of this section.
(ii) Once processing is complete, we will refund to you the amount
of money that we did not spend on processing costs.
(5) Consistent with the payment and billing terms provided in the
final estimate, we will periodically estimate what our reasonable
processing costs will be for a specific period and will bill you for
that period. Payment is due to us 30 days after you receive your bill.
We will stop processing your document if you do not pay the bill by the
date payment is due. If a periodic payment turns out to be more or less
than our reasonable processing costs for the period, we will adjust the
next billing accordingly or make a refund. Do not deduct any amount
from a payment without our prior written approval.
(6) You must pay the entire fee before we will issue the final
document or take final action on your application or request.
(7) You may appeal our estimated processing costs in accordance
with the regulations in Sec. 585.118 and 43 CFR part 4. We will not
process the document further until the appeal is resolved, unless you
pay the fee under protest while the appeal is pending. If the appeal
results in a decision changing the proposed fee, we will adjust the fee
in accordance with this section. If we adjust the fee downward, we will
not pay interest.
Sec. 585.113 Definitions.
Terms used in this part have the meanings as defined in this
section:
Affected local government means with respect to any activities
proposed, conducted, or approved under this part or 30 CFR part 285,
any locality:
(1) That is, or is proposed to be, the site of gathering,
transmitting, or distributing electricity or other energy product, or
is otherwise receiving, processing, refining, or transshipping product,
or services derived from activities approved under this part or 30 CFR
part 285;
(2) That is used, or is proposed to be used, as a support base for
activities approved under this part or 30 CFR part 285; or
(3) In which there is a reasonable probability of significant
effect on land or water uses from activities approved under this part,
or 30 CFR part 285.
Affected State means with respect to any activities proposed,
conducted, or approved under this part or 30 CFR part 285, any coastal
State--
(1) That is, or is proposed to be, the site of gathering,
transmitting, or distributing energy or is otherwise receiving,
processing, refining, or transshipping products, or services derived
from activities approved under this part or 30 CFR part 285;
(2) That is used, or is scheduled to be used, as a support base for
activities approved under this part or 30 CFR part 285; or
(3) In which there is a reasonable probability of significant
effect on land or water uses from activities approved under this part
or 30 CFR part 285.
Archaeological resource means any material remains of human life or
activities that are at least 50 years of age and that are of
archaeological interest (i.e., which are capable of providing
scientific or humanistic understanding of past human behavior, cultural
adaptation, and related topics through the application of scientific or
scholarly techniques, such as controlled observation, contextual
measurement, controlled collection, analysis, interpretation, and
explanation).
Best available and safest technology means the best available and
safest technologies that BOEM determines to be economically feasible
wherever failure of equipment would have a significant effect on
safety, health, or the environment.
Best management practices mean practices recognized within their
respective industry, or by government, as one of the best for achieving
the desired output while reducing undesirable outcomes.
Bidding credits means the value assigned by BOEM, expressed in
monetary terms, to the factors or actions demonstrated, or committed
to, by a bidder at a BOEM lease auction during the competitive lease
award process. The type(s) and value(s) of any bidding credit(s)
awarded to any given bidder will be set forth in the Final Sale Notice.
BOEM means Bureau of Ocean Energy Management of the Department of
the Interior.
BSEE means Bureau of Safety and Environmental Enforcement of the
Department of the Interior.
Certified Verification Agent (CVA) means an individual or
organization, experienced in the design, fabrication, and installation
of offshore marine facilities or structures, who will conduct specified
third-party reviews, inspections, and verifications in accordance with
30 CFR part 285.
Coastal environment means the physical atmospheric, and biological
components, conditions, and factors which interactively determine the
productivity, state, condition, and quality of the terrestrial
ecosystem from the shoreline inward to the boundaries of the coastal
zone.
Coastline means the same as the term ``coast line'' in section 2 of
the Submerged Lands Act (43 U.S.C. 1301(c)).
Commercial activities means, under renewable energy leases and
grants, all activities associated with the generation, storage, or
transmission of electricity or other energy product from a renewable
energy project on the OCS, and for which such electricity or other
energy product is intended for distribution, sale, or other commercial
use, except for electricity or other energy product distributed or sold
pursuant to technology-testing activities on a limited lease. This term
also includes activities associated with all stages of development,
including initial site characterization and assessment, facility
construction, and project decommissioning.
Commercial lease means a lease issued under this part that
specifies the terms and conditions under which a person can conduct
commercial activities.
[[Page 42726]]
Commercial operations means the generation of electricity or other
energy product for commercial use, sale, transmission, or distribution
from a commercial lease.
Critical Safety Systems and Equipment means safety systems and
equipment designed to prevent or ameliorate fire, spillages, or other
major accidents that could result in harm to health, safety, or the
environment in the area of your facilities.
Decommissioning means removing BOEM and BSEE approved facilities
and returning the site of the lease or grant to a condition that meets
the requirements under subpart I of 30 CFR part 285.
Director means the Director of BOEM, or an official authorized to
act on the Director's behalf.
Distance means the minimum great circle distance.
Eligible State means a coastal State having a coastline (measured
from the nearest point) no more than 15 miles from the geographic
center of a qualified project area.
Fabrication means the cutting, fitting, welding, or other assembly
of project elements.
Facility means an installation that is permanently or temporarily
attached to the seabed of the OCS. Facilities include any structures;
devices; appurtenances; gathering, transmission, and distribution
cables; pipelines; and permanently moored vessels. Any group of OCS
installations interconnected with walkways, or any group of
installations that includes a central or primary installation with one
or more satellite or secondary installations, is a single facility.
BOEM and BSEE may decide that the complexity of the installations
justifies their classification as separate facilities.
Geographic center of a project means the centroid (geometric center
point) of a qualified project area. The centroid represents the point
that is the weighted average of coordinates of the same dimension, with
the weights determined by a density function. For example, in the case
of a project area shaped as a rectangle or other parallelogram, the
geographic center would be that point where lines between opposing
corners intersect. The geographic center of a project could be outside
the project area itself if that area is irregularly shaped.
Governor means the Governor of a State or the person or entity
lawfully designated by or under State law to exercise the powers
granted to a Governor.
Grant means a right-of-way or a right-of-use and easement issued
under the provisions of this part.
Human environment means the physical, social, and economic
components, conditions, and factors that interactively determine the
state, condition, and quality of living conditions, employment, and
health of those affected, directly or indirectly, by activities
occurring on the OCS.
Lease means an agreement authorizing the use of a designated
portion of the OCS for activities allowed under this part. The term
also means the area covered by that agreement, when the context
requires.
Lease area means an area on the OCS that BOEM has identified for
leasing for potential development of renewable energy resources.
Lessee means the holder of a lease, a BOEM-approved assignee, and,
when describing the conduct required of parties engaged in activities
on the lease, it also refers to the operator and all persons authorized
by the holder of the lease or operator to conduct activities on the
lease.
Limited lease means a lease issued under this part that specifies
the terms and conditions under which a person may conduct activities on
the OCS that support the production of energy, but do not result in the
production of electricity or other energy product for sale,
distribution, or other commercial use exceeding a limit specified in
the lease.
Marine environment means the physical, atmospheric, and biological
components, conditions, and factors that interactively determine the
productivity, state, condition, and quality of the marine ecosystem.
These include the waters of the high seas, the contiguous zone,
transitional and intertidal areas, salt marshes, and wetlands within
the coastal zone and on the OCS.
Miles means nautical miles, as opposed to statute miles.
Multiple factor auction means an auction that involves the use of
bidding credits to incentivize goals or actions that support public
policy objectives or maximize public benefits through the competitive
leasing auction process. For any multiple factor auction, the monetary
value of the bidding credits, if any, would be added to the value of
the cash bid to determine the highest bidder.
Natural resources include, without limiting the generality thereof,
renewable energy, oil, gas, and all other minerals (as defined in
section 2(q) of the OCS Lands Act), and marine animal and marine plant
life.
Operator means the individual, corporation, or association having
control or management of activities on the lease or grant under this
part. The operator may be a lessee, grant holder, or a contractor
designated by the lessee or holder of a grant issued under this part.
Outer Continental Shelf (OCS) means all submerged lands lying
seaward and outside of the area of lands beneath navigable waters, as
defined in section 2 of the Submerged Lands Act (43 U.S.C. 1301), whose
subsoil and seabed appertain to the United States and are subject to
its jurisdiction and control or within the exclusive economic zone of
the United States and adjacent to any territory of the United States
and does not include any area conveyed by Congress to a territorial
government for administration.
Person means, in addition to a natural person, an association
(including partnerships and joint ventures); a Federal agency; a State;
a political subdivision of a State; a Native American Tribal
government; or a private, public, or municipal corporation.
Project, for the purposes of defining the source of revenues to be
shared, means a lease, ROW, RUE, or Alternate Use RUE on which the
activities authorized under this part and/or 30 CFR part 285 or 586 are
conducted on the OCS. The term ``project'' may be used elsewhere in
this part to refer to these same authorized activities, the facilities
used to conduct these activities, or to the geographic area of the
project, i.e., the project area.
Project area means the geographic surface leased, or granted, for
the purpose of a specific project. If OCS acreage is granted for a
project under some form of agreement other than a lease (i.e., a ROW or
RUE), the Federal acreage granted would be considered the project area.
To avoid distortions in the calculation of the geometric center of the
project area, project easements issued under this part are not
considered part of the qualified project's area.
Project Design Envelope (PDE) means a reasonable range of design
parameters proposed in a lessee's plan for components of the project,
such as type, dimensions, and number of wind turbine generators;
foundation type; location of the export cable route; location of an
onshore substation; location of the grid connection point; and
construction methods and timing.
Project easement means an easement to which, upon approval of your
Construction and Operations Plan (COP) or General Activities Plan
(GAP), you are entitled as part of the lease for the purpose of
installing, maintaining, repairing and replacing: gathering,
[[Page 42727]]
transmission, and distribution, and inter-array cables; power and
pumping stations; facility anchors; pipelines; and associated
facilities and other appurtenances on the OCS as necessary for the full
enjoyment of the lease.
Provisional winner means a bidder that BOEM determines at the
conclusion of the auction to have submitted the winning bid. The
provisional winner becomes the winning bidder after the favorable
completion of BOEM's bid review, Department of Justice antitrust
review, bidder obligations under Sec. 585.225(b), and any appeals
process under Sec. 585.118(c).
Receipt, as used in this part to describe the time when a document
is received by any party in the absence of documentation to the
contrary, is deemed to have taken place:
(1)(i) Five (5) business days after the date the document was given
to the U.S. Postal Service (or deposited in one of its mailboxes),
properly addressed and with proper postage affixed, or was given to a
delivery service (or deposited in one of its receptacles), properly
addressed and with the delivery cost prepaid; or
(ii) On the date on which the document was properly addressed and
sent electronically.
(2) This definition also applies to variants of the words
``receipt'' and ``receive'' where those terms are used in this part to
describe the receipt of a document when the timing of receipt triggers
a regulatory time period or consequence.
Renewable Energy means energy resources other than oil and gas and
minerals as defined in 30 CFR part 580. Such resources include, but are
not limited to, wind, solar, and ocean waves, tides, and current.
Revenues mean bonuses, rents, operating fees, and similar payments
made in connection with a project or project area. It does not include
administrative fees such as those assessed for cost recovery, civil
penalties, and forfeiture of financial assurance.
Right-of-use and easement (RUE) grant means an easement issued by
BOEM under this part that authorizes use of a designated portion of the
OCS to support activities on a lease or other use authorization for
renewable energy activities. The term also means the area covered by
the authorization.
Right-of-way (ROW) grant means an authorization issued by BOEM
under this part to use a portion of the OCS for the construction and
use of a cable or pipeline for the purpose of gathering, transmitting,
distributing, or otherwise transporting electricity or other energy
product generated or produced from renewable energy, but does not
constitute a project easement under this part. The term also means the
area covered by the authorization.
Secretary means the Secretary of the Interior or an official
authorized to act on the Secretary's behalf.
Significant archaeological resource means an archaeological
resource that meets the criteria of significance for eligibility for
listing in the National Register of Historic Places, as defined in 36
CFR 60.4.
Site assessment activities mean those initial activities conducted
to assess an area on the OCS, such as resource assessment surveys
(e.g., meteorological and oceanographic) or technology testing,
involving the installation of bottom-founded facilities.
We, us, and our refer to BOEM, or its possessive, depending on the
context.
You and your means an applicant, lessee, the operator, or
designated operator, ROW grant holder or RUE grant holder under this
part, or the designated agent of any of these, or the possessive of
each, depending on the context. The terms you and your also include
contractors and subcontractors of the entities specified in the
preceding sentence.
Sec. 585.114 How will data and information obtained by BOEM under
this part be disclosed to the public?
(a) BOEM will make data and information available in accordance
with the requirements and subject to the limitations of the Freedom of
Information Act (FOIA) (5 U.S.C. 552) and the regulations contained in
43 CFR part 2.
(b) BOEM will not release such data and information that we have
determined is exempt from disclosure under exemption 4 of FOIA. We will
review such data and information and objections of the submitter by the
following schedule to determine whether release at that time will
result in substantial competitive harm or disclosure of trade secrets.
------------------------------------------------------------------------
Then BOEM will review data and
If you have a . . . information for possible release:
------------------------------------------------------------------------
(1) Commercial lease......... At the earlier of:
(i) 3 years after the commencement of
commercial operations; or
(ii) 3 years after the lease terminates.
(2) Limited lease............ At 3 years after the lease terminates.
(3) ROW or RUE grant......... At the earliest of:
(i) 10 years after the approval of the
grant;
(ii) Grant termination; or
(iii) 3 years after the completion of
construction activities.
------------------------------------------------------------------------
(c) After considering any objections from the submitter, if we
determine that release of such data and information will result in:
(1) No substantial competitive harm or disclosure of trade secrets,
then the data and information will be released.
(2) Substantial competitive harm or disclosure of trade secrets,
then the data and information will not be released at that time but
will be subject to further review every 3 years thereafter.
Sec. 585.115 Paperwork Reduction Act statements--information
collection.
(a) The Office of Management and Budget (OMB) has approved the
information collection requirements in this part under 44 U.S.C. 3501,
et seq., and assigned OMB Control Number 1010-0176. The table in
paragraph (e) of this section lists the subparts in the rule requiring
the information and its title, summarizes the reasons for collecting
the information, and summarizes how BOEM uses the information.
(b) Respondents are primarily renewable energy applicants, lessees,
ROW grant holders, RUE grant holders, Alternate Use RUE grant holders,
and operators. The requirement to respond to the information collection
in this part is mandated under subsection 8(p) of the OCS Lands Act.
Some responses are also required to obtain or retain a benefit or may
be voluntary.
(c) The Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.)
requires us to inform the public that an agency may not conduct or
sponsor, and you are not
[[Page 42728]]
required to respond to, a collection of information unless it displays
a currently valid OMB control number.
(d) Comments regarding any aspect of the collections of information
under this part, including suggestions for reducing the burden, should
be sent to the Information Collection Clearance Officer, Bureau of
Ocean Energy Management, 45600 Woodland Road, Sterling, VA 20166.
(e) BOEM is collecting this information for the reasons given in
the following table:
------------------------------------------------------------------------
Reasons for collecting information and
30 CFR 585 subpart and title how used
------------------------------------------------------------------------
(1) Subpart A--General To inform BOEM of actions taken to comply
Provisions. with general operational requirements on
the OCS. To ensure that operations on
the OCS meet statutory and regulatory
requirements, are safe and protect the
environment, and result in diligent
development on OCS leases.
(2) Subpart B--The Renewable To enable BOEM to publish a proposed five-
Energy Leasing Schedule. year leasing schedule for the OCS
renewable energy program.
(3) Subpart C--Issuance of To provide BOEM with information needed
OCS Renewable Energy Leases. to determine when to use a competitive
process for issuing a renewable energy
lease, to identify auction formats and
bidding systems and variables that we
may use when that determination is
affirmative, and to determine the terms
under which we will issue renewable
energy leases.
(4) Subpart D--ROW Grants and To issue ROW grants and RUE grants for
RUE Grants for Renewable OCS renewable energy activities that are
Energy Activities. not associated with a BOEM-issued
renewable energy lease.
(5) Subpart E--Lease and To ensure compliance with regulations
Grant Administration. pertaining to a lease or grant,
including designation of operator,
assignment, segregation, consolidation,
suspension, renewal, termination,
relinquishment, and cancellation.
(6) Subpart F--Payments and To ensure that payments and financial
Financial Assurance assurance payments for renewable energy
Requirements. leases comply with subpart E.
(7) Subpart G--Plans and To enable BOEM to comply with the
Information Requirements. National Environmental Policy Act (NEPA)
(42 U.S.C. 4321 et seq.), the Coastal
Zone Management Act (CZMA) (16 U.S.C.
1451 et seq.), and other Federal laws
and to ensure the safety of the
environment on the OCS.
------------------------------------------------------------------------
Sec. 585.116 Requests for information.
BOEM may publish a request for information (RFI) in the Federal
Register for the following reasons:
(a) To solicit information from industry, federally recognized
Tribes, State and local agencies, and other interested entities for
evaluating the offshore renewable energy industry, including the
identification of potential challenges or obstacles to its continued
development. An RFI may relate to the identification of environmental,
technical, regulatory, or economic matters that promote or detract from
continued development of renewable energy technologies on the OCS. BOEM
may use the information received to refine its renewable energy
program, including to facilitate OCS renewable energy development in a
safe and environmentally responsible manner and to ensure a fair return
to the United States for use of the OCS.
(b) To assess interest in leasing all or part of the OCS for
activities authorized in this part.
(c) To determine whether there is competitive interest in a
specific OCS renewable energy proposal received by BOEM, such as an
unsolicited request for a lease under Sec. 585.231(b) or a RUE or ROW
grant under Sec. 585.307(a).
(d) To seek other information that BOEM needs for this program.
Sec. 585.117 Severability.
If a court holds any provisions of this part or their applicability
to any persons or circumstances invalid, the remainder of the
provisions and their applicability to any persons or circumstances will
not be affected.
Sec. 585.118 What are my appeal rights?
(a) Except as stated in paragraph (c) of this section, any party
adversely affected by a final decision issued by BOEM under this part
may appeal that decision to the Interior Board of Land Appeals (IBLA),
under 30 CFR part 590 and 43 CFR part 4, subpart E.
(b) Any final decision will remain in full force and effect during
the pendency of an appeal unless a stay is granted under 43 CFR part 4.
(c) A bidder adversely affected by BOEM's determination of a
provisional winner made under this part may appeal to the BOEM
Director, but decisions determining a provisional winner may not be
appealed to the IBLA.
(1) A bidder that elects to appeal a provisional winner selection
decision must file a written appeal with the Director within 15
business days after receipt of the decision.
(2) Such appeal must be accompanied by a statement of reasons.
Before reversing a provisional winner selection decision, the Director
will provide the provisional winner a reasonable opportunity to respond
in writing to the appellant's statement of reasons. The Director will
issue a written determination either affirming or reversing the
decision. The Director's decision is not appealable to the IBLA under
this section.
(3) BOEM will not execute a lease or grant until the 15-business-
day appeal period closes and all timely filed appeals are resolved.
(4) The review authority of the Office of Hearings and Appeals does
not apply to either the provisional winner selection decisions made
under this part or the Director's final determination affirming or
reversing a provisional winner selection decision.
Sec. Sec. 585.119-585.149 [Reserved]
0
46. Revise subpart B to read as follows:
Subpart B--The Renewable Energy Leasing Schedule
Sec.
585.150 What is the Renewable Energy Leasing Schedule?
585.151-585.199 [Reserved]
Subpart B--The Renewable Energy Leasing Schedule
Sec. 585.150 What is the Renewable Energy Leasing Schedule?
At least once every 2 years, the Secretary will publish a schedule
with a list of locations under consideration for leasing, along with a
projection of when lease sales are anticipated to occur for the 5-year
period following the schedule's publication. This schedule will include
a general description of the area covered by each proposed lease sale,
the calendar year in which each lease sale is projected to occur, and
the reasons for any changes made to the previous schedule. Any proposed
lease sale covered by the schedule will be subject to all applicable
regulations, including area identification,
[[Page 42729]]
coordination with relevant parties, and applicable environmental
reviews.
Sec. Sec. 585.151-585.199 [Reserved]
0
47. Revise subpart C to read as follows:
Subpart C--Issuance of OCS Renewable Energy Leases
Sec.
General Lease Information
585.200 What rights are granted with a lease issued under this part?
585.201 How will BOEM issue leases?
585.202 What types of leases will BOEM issue?
585.203 With whom will BOEM consult before issuance of leases?
585.204 What areas are available for leasing consideration?
585.205 How will leases be mapped?
585.206 What is the lease size?
585.207-585.209 [Reserved]
Competitive Lease Award Process--Pre-Auction Provisions
585.210 What are the steps in BOEM's competitive lease award
process?
585.211 What is the Call?
585.212 What is area identification?
585.213 What information is included in the PSN?
585.214 What information is included in the FSN?
585.215 What may BOEM do to assess whether competitive interest for
a lease area still exists before the auction?
585.216 How are bidding credits awarded and used?
585.217-585.219 [Reserved]
Competitive Lease Award Process--Auction Provisions
585.220 How will BOEM award leases competitively?
585.221 What general provisions apply to all auctions?
585.222 What other auction rules must bidders follow?
585.223 What supplemental information will BOEM provide in a PSN and
FSN?
Competitive Lease Award Process--Post-Auction Provisions
585.224 What will BOEM do after the auction?
585.225 What happens if BOEM accepts a bid?
585.226 What happens if the provisional winner fails to meet its
obligations?
585.227-585.229 [Reserved]
Noncompetitive Lease Award Process
585.230 May I request a lease if there is no Call?
585.231 Will BOEM issue leases noncompetitively?
585.232 May I acquire a lease noncompetitively after responding to a
request for information or a Call for Information and Nominations?
585.233-585.234 [Reserved]
Commercial and Limited Lease Periods
585.235 What are the lease periods for a commercial lease?
585.236 If I have a limited lease, how long will my lease remain in
effect?
585.237 What is the effective date of a lease?
585.238 May I develop my commercial lease in phases?
585.239 Are there any other renewable energy research activities
that will be allowed on the OCS?
585.240-585.299 [Reserved]
Subpart C--Issuance of OCS Renewable Energy Leases
General Lease Information
Sec. 585.200 What rights are granted with a lease issued under this
part?
(a) A lease issued under this part grants the lessee the right,
subject to obtaining the necessary approvals, including but not limited
to those required under the FERC hydrokinetic licensing process, and
complying with all provisions of this part, to occupy, and install and
operate facilities on, a designated portion of the OCS for the purpose
of conducting:
(1) Commercial activities; or
(2) Other limited activities that support, result from, or relate
to the production of energy from a renewable energy source.
(b) A lease issued under this part confers on the lessee the right
to one or more project easements without further competition for the
purpose of installing gathering, transmission, and distribution cables;
pipelines; and appurtenances on the OCS as necessary for the full
enjoyment of the lease.
(1) You must apply for the project easement as part of your COP or
GAP, as provided under subpart G of this part; and
(2) BOEM will incorporate your approved project easement in your
lease as an addendum.
(c) A commercial lease issued under this part may be developed in
phases, with BOEM approval as provided in Sec. 585.238.
Sec. 585.201 How will BOEM issue leases?
BOEM will issue leases on a competitive basis, as provided under
Sec. Sec. 585.210 through 585.226. However, if we determine after
public notice of a proposed lease that there is no competitive
interest, we will issue leases noncompetitively, as provided under
Sec. Sec. 585.230 through 585.232. We will issue leases on forms
approved by BOEM and will include terms, conditions, and stipulations
identified and developed as appropriate.
Sec. 585.202 What types of leases will BOEM issue?
BOEM may issue commercial or limited leases for OCS activities
under Sec. 585.104. BOEM may issue a lease for OCS renewable energy
research activities under Sec. 585.239.
Sec. 585.203 With whom will BOEM consult before issuance of leases?
For leases issued under this part, through either the competitive
or noncompetitive process, BOEM, prior to issuing the lease, will
coordinate and consult with relevant Federal agencies (including, in
particular, those agencies involved in planning activities that are
undertaken to avoid or minimize conflicts among users and maximize the
economic and ecological benefits of the OCS, including multifaceted
spatial planning efforts), any affected federally recognized Indian
Tribes, the Native Hawaiian Community or Alaska Native Corporations, as
appropriate, the Governor of any affected State, and the executive of
any affected local government, as directed by subsections 8(p)(4) and
(7) of the OCS Lands Act or other relevant Federal laws. Federal
statutes that require BOEM to consult with interested parties or
Federal agencies or to respond to findings of those agencies include
the Endangered Species Act (ESA) and the Magnuson-Stevens Fishery
Conservation and Management Act. BOEM also engages in consultation with
Tribal and State historic preservation officers pursuant to the
National Historic Preservation Act (NHPA).
Sec. 585.204 What areas are available for leasing consideration?
BOEM may offer any appropriately platted area of the OCS, as
provided in Sec. 585.205, for a renewable energy lease, except any
area within the exterior boundaries of any unit of the National Park
System, National Wildlife Refuge System, National Marine Sanctuary
System, or any National Monument.
Sec. 585.205 How will leases be mapped?
BOEM will prepare leasing maps and official protraction diagrams of
areas of the OCS. The areas included in each lease will be in
accordance with the appropriate leasing map or official protraction
diagram.
Sec. 585.206 What is the lease size?
(a) BOEM will determine the size for each lease based on the area
required to accommodate the anticipated activities. The processes
leading to both competitive and noncompetitive issuance of leases will
provide public notice of the lease size adopted. We will delineate
leases by using mapped OCS
[[Page 42730]]
blocks or portions, or aggregations of blocks.
(b) The lease size includes the minimum area that will allow the
lessee sufficient space to develop the project and manage activities in
a manner that is consistent with the provisions of this part and 30 CFR
part 285. The lease may include whole lease blocks or portions of a
lease block.
Sec. Sec. 585.207-585.209 [Reserved]
Competitive Lease Award Process--Pre-Auction Provisions
Sec. 585.210 What are the steps in BOEM's competitive lease award
process?
(a) BOEM may publish an RFI under Sec. 585.116.
(b) BOEM will award leases through a competitive lease award
process unless competitive interest does not exist. BOEM will publish
details for each auction and lease through appropriate notices in the
Federal Register. Each competitive lease award process will include the
following steps:
(1) Call for information and nominations (Call). BOEM will publish
a Call in the Federal Register requesting information to determine
qualifications of prospective bidders and interest in preliminarily
identified OCS lease areas.
(2) Area identification. BOEM will identify OCS areas for leasing
consideration and related analysis in consultation with appropriate
Federal agencies, State and local governments, federally recognized
Tribes, Alaska Native Claims Settlement Act (ANCSA) corporations, and
other interested parties.
(3) Proposed Sale Notice (PSN). BOEM will publish a PSN, or a
notice of its availability, in the Federal Register, announcing BOEM's
intention to conduct an auction for prospective lease areas. The PSN
will set forth provisions and information concerning the proposed
auction and lease and will invite stakeholder comments.
(4) Final Sale Notice (FSN). BOEM will publish an FSN, or a notice
of its availability, in the Federal Register setting forth final
information concerning the auction and lease.
(5) Auction. BOEM will hold an auction under the regulations in
this part and the FSN.
(6) Lease award. BOEM will award leases subsequent to the
completion of the aforementioned steps under the regulations in this
part and the FSN.
Sec. 585.211 What is the Call?
(a) The Call is a notice that BOEM will publish in the Federal
Register requesting responses from stakeholders interested in bidding
on designated OCS areas and comments from interested and potentially
affected parties. The responses may inform the area identification
process and will enable BOEM to determine whether there exists
competitive interest in the proposed lease area. BOEM may request
additional information from stakeholders related to environmental,
economic, and other issues.
(b) The Call may include the following:
(1) The areas that BOEM has preliminarily identified for leasing
consideration;
(2) A request for comments concerning geological conditions;
archaeological sites on the seabed or nearshore; multiple uses of the
proposed leasing area (including, for example, navigation, recreation,
military, and fisheries); and other socioeconomic, biological, and
environmental information;
(3) Request for comments regarding feasibility for development,
including the energy resource and opportunity for grid connection;
(4) Possible lease terms and conditions;
(5) A request to potential bidders to nominate one or more areas
for a commercial renewable energy lease within the preliminarily
identified leasing areas. Such nominations must include:
(i) The specific OCS blocks that the respondent is interested in
leasing;
(ii) A general description of the respondent's objectives and how
respondent proposes to achieve those objectives;
(iii) A preliminary schedule of the respondent's proposed
activities, including those potentially leading to commercial
operations, to the extent known;
(iv) Information regarding respondent's coordination, or intent to
coordinate, with any other entity for the purposes of acquiring a lease
from BOEM, if applicable;
(v) Documentation demonstrating the respondent's qualification to
acquire a lease or grant as specified in Sec. Sec. 585.107 and
585.108;
(vi) Available and pertinent information concerning renewable
energy and environmental conditions in the nominated areas, including
energy and resource data and information used to evaluate the areas;
and
(vii) Any additional information requested by BOEM in the Call;
(c) Respondents have 45 calendar days from the date the Call is
published in the Federal Register to reply, unless BOEM specifies
another time period of not less than 30 calendar days in the Call.
(d) BOEM may use the information received in response to a Call to:
(1) Identify lease areas;
(2) Develop options for its lease provisions (e.g., stipulations,
payments, terms, and conditions);
(3) Inform its environmental analysis conducted under applicable
Federal requirements, including, but not limited to, NEPA, the
Endangered Species Act (ESA) (16 U.S.C. 1531-1544), and the CZMA; and
(4) Determine whether competitive interest exists in all or a
portion of any potential lease area. If BOEM determines no competitive
interest exists, BOEM may follow the noncompetitive leasing process set
forth in Sec. 585.231(d) through (j).
Sec. 585.212 What is area identification?
(a) Area identification is the process by which BOEM delineates one
or more OCS areas for leasing consideration and environmental analysis
if the areas appear appropriate for renewable energy development. This
process is based on an area's relevant attributes, such as other uses
of the area, environmental factors or characteristics, stakeholder
comments, industry nominations, feasibility for development, and other
relevant information. BOEM consults with interested parties during this
process as specified in Sec. 585.210(b)(2).
(b) BOEM may consider areas nominated by respondents to a Call and
other areas determined appropriate for leasing.
(c) For the identified areas, BOEM will evaluate:
(1) The potential effects of leasing the identified areas on the
human, marine, and coastal environments;
(2) The feasibility of development; and
(3) Potential measures, including lease stipulations, to mitigate
potential adverse impacts. Such measures are identified and refined
through the area identification process, as well as through
environmental review and consultations and published for comment in the
Proposed Sale Notice.
(d) BOEM may hold public hearings on the environmental analyses
associated with leasing the identified areas, after appropriate notice.
(e) At the end of the area identification, BOEM may offer selected
areas for leasing.
Sec. 585.213 What information is included in the PSN?
(a) The PSN is a notice that BOEM will publish in the Federal
Register for each prospective auction. The PSN will
[[Page 42731]]
request public comment on the items listed in this section. Public
comments will inform BOEM's decisions regarding auction format and
lease terms and conditions. At a minimum, the PSN will include or
describe the availability of information pertaining to:
(1) The proposed leases to be offered, including:
(i) The proposed lease areas, including size and location;
(ii) The proposed lease terms and conditions, including the
proposed rental rate and operating fee rate;
(iii) Other proposed payment requirements, as applicable; and
(iv) Proposed requirements for performance under the lease, such as
site-specific lease stipulations and environmental mitigation measures;
(2) Steps a bidder must take to obtain and maintain eligibility to
participate in the auction (e.g., financial forms, bid deposits);
(3) The proposed availability and potential value of bidding
credit(s), if any are offered, and the actions or commitments required
to obtain them;
(4) A detailed description of the proposed auction format and
procedures as further described in Sec. 585.223;
(5) The maximum number or specific sets of lease areas that any
given bidder may be allowed to bid on or to acquire in an auction, if
applicable;
(6) Lease award procedures, including how and when a lease will be
awarded and executed, and how BOEM will address unsuccessful bids and
applications;
(7) A copy of, or a reference to, the official BOEM lease form; and
(8) Other relevant matters, as determined by BOEM.
(b) The PSN may be used to gauge competitive interest by requiring
prospective bidders to reaffirm their intent to participate in the
auction as a prerequisite for continued eligibility.
(c) A prospective bidder is encouraged to identify in its comments
any specific proposed terms and conditions in the PSN that may preclude
its participation in the auction.
(d) The PSN's public comment period is 60 calendar days from the
date of its publication in the Federal Register, unless BOEM specifies
another time period of not less than 30 calendar days in the PSN.
(e) BOEM will notify any potentially affected federally recognized
Indian Tribes, States, local governments, and ANCSA corporations of the
PSN's publication, and will provide copies of the PSN to these entities
upon written request.
Sec. 585.214 What information is included in the FSN?
(a) The FSN is a notice that BOEM will publish in the Federal
Register at least 30 calendar days before each prospective auction. The
FSN will describe the final auction details and will include or
describe the availability of information pertaining to:
(1) The leases to be offered, including:
(i) The lease areas, including size and location;
(ii) Lease terms and conditions, including the rental rate and the
operating fee rate;
(iii) Other payment requirements, as applicable; and
(iv) Requirements for performance under the lease, including site-
specific lease stipulations and environmental mitigation measures;
(2) Steps a bidder must take to ensure eligibility to participate
in the auction (e.g., financial forms, bid deposits);
(3) The availability and potential value of bidding credit(s), if
any are offered, and the actions or commitments required to obtain
them.
(4) A detailed description of the auction format and procedures as
further described in Sec. 585.223;
(5) The maximum number or specific sets of lease areas that any
given bidder may be allowed to bid on or to acquire in an auction, if
applicable;
(6) Lease award procedures, including how and when a lease will be
awarded and executed, and how BOEM will handle unsuccessful bids and
applications;
(7) A copy of, or a reference to, the official BOEM lease form; and
(8) Other relevant matters as determined by BOEM.
(b) The terms of the FSN may differ from the proposed terms of the
PSN.
Sec. 585.215 What may BOEM do to assess whether competitive interest
for a lease area still exists before the auction?
(a) At any time BOEM has reason to believe that competitive
interest in any lease area no longer exists before the area's auction,
BOEM may issue a notice in the Federal Register, as described in Sec.
585.116, requesting information regarding competitive interest in that
area. BOEM will consider respondents' comments to determine whether
competitive interest in that area remains. BOEM may decide to end the
competitive process for any area if it determines that competitive
interest no longer exists.
(b) If BOEM determines after considering respondents' comments to
such a notice that competitive interest remains, BOEM will continue
with the competitive process set forth in Sec. Sec. 585.210 through
585.226.
(c) If BOEM determines at any time before the auction that only a
single party remains interested in a lease area, BOEM may proceed
either with the auction or with the noncompetitive process set forth in
Sec. 585.231(d) through (j) following payment by that party of the
acquisition fee specified in Sec. 585.502(a).
Sec. 585.216 How are bidding credits awarded and used?
(a) BOEM will determine the highest bid, taking into account the
combined value of the monetary (cash) component and the non-monetary
component(s), represented by bidding credits. The PSN and FSN will
explain the following details, if bidding credit(s) are available for
that auction:
(1) Eligibility and application requirements;
(2) The value of each available bidding credit, which will be
either a sum certain or a percentage of the bid; and
(3) Procedures for applying each available bidding credit to bids
submitted during the auction.
(b) Eligibility for bidding credits must be established in advance
of any lease auction, in accordance with the specifications of the FSN.
Such eligibility may be based on actions that the bidder has already
undertaken or actions that it has committed to undertake in the future,
provided that BOEM has agreed to the terms by which such a commitment
will be made. BOEM may offer bidding credits for any of the following:
(1) Power purchase agreements;
(2) Eligibility for, or applicability of, renewable energy credits
or subsidies;
(3) Development agreements by a potential lessee that facilitate
shared transmission solutions and grid interconnection;
(4) Technical merit, timeliness, or financing and economic
considerations;
(5) Environmental considerations, public benefits, or compatibility
with State and local needs;
(6) Agreements or commitments by the developer that would
facilitate OCS renewable energy development or other OCSLA goals; or
(7) Any other factor or criteria to further development of offshore
renewable energy, as identified by BOEM in the PSN and FSN.
(c) Before the auction, bidders seeking to use bidding credits must
establish that they meet the eligibility criteria for each bidding
credit according to the FSN provisions.
(d) Before the auction, BOEM will determine each bidder's
eligibility for bidding credits, and the value of those
[[Page 42732]]
bidding credits, and will inform each eligible bidder of the value of
the bidding credits to which it may be entitled.
(e) A provisional winner who is awarded bidding credits must pay an
amount equal to the cash component of its winning bid less any bid
deposit retained by BOEM under Sec. 585.501.
Sec. Sec. 585.217-585.219 [Reserved]
Competitive Lease Award Process--Auction Provisions
Sec. 585.220 How will BOEM award leases competitively?
(a) BOEM will award leases competitively using an objective, fair,
reasonable, and competitive auction process that provides a fair return
to the United States. As described in the FSN, leases will be awarded
to the highest bidder.
(b) BOEM may use any analog or digital method to conduct the
auction. The specific process and procedural details for each auction
will be noticed in the PSN and finalized in the FSN.
Sec. 585.221 What general provisions apply to all auctions?
(a) If BOEM determines competitive interest exists to develop a
renewable energy resource in any OCS area and decides to issue a lease
for that area, BOEM will conduct an auction to award the lease.
(b) The auction's format, procedures, and other details will be
specified in the FSN, as outlined in Sec. 585.214. Possible auction
formats include, but are not limited to, sealed bidding and ascending
bidding.
(c) The FSN will specify the potential use of alternatives if the
primary auction method, system, or mechanism malfunctions.
Alternatively, BOEM may take action consistent with paragraph (d) of
this section until the malfunction is resolved.
(d) Any time before a provisional winner is determined, BOEM may
delay, suspend, or cancel an auction due to a natural or man-made
disaster, technical malfunction, security breach, unlawful bidding
activity, administrative necessity, or any other reason that BOEM
determines may adversely affect the fair and efficient conduct of the
auction. In its discretion, BOEM may restart the auction at whatever
point it deems appropriate, reasonable, fair, and efficient for all
participants; or, alternatively, BOEM may cancel the auction in its
entirety.
(e) BOEM will determine the provisional winner for each lease area
under the auction rules and bidding procedures prescribed in the FSN.
Sec. 585.222 What other auction rules must bidders follow?
(a) Bidders must submit a deposit to participate in an auction
under Sec. 585.501(a), unless otherwise specified in the FSN. A
provisional winner's bid deposit will be credited toward the balance
due on its bid.
(b) Only bidders qualified by BOEM under Sec. Sec. 585.107 and
585.108 are permitted to bid during an auction.
(c) Only an authorized agent may act on a bidder's behalf during an
auction. Bidders must submit the names of their authorized agents to
BOEM before the auction, as prescribed in the FSN.
(d) Each bidder must follow the auction process specified in the
FSN and may not take any action to disrupt or alter the process beyond
its intended function.
(e) A bidder is responsible for immediately contacting BOEM if it
is unable to submit its bid for any reason during an auction. If a
bidder fails to timely notify BOEM of its inability to bid, it may not
dispute the auction or lease award on that basis. If a bidder timely
notifies BOEM of its inability to submit a bid, BOEM, in its
discretion, may suspend the auction, continue the auction using an
alternative method, or continue the auction without the participation
of the affected bidder.
Sec. 585.223 What supplemental information will BOEM provide in a PSN
and FSN?
(a) In addition to the information described in Sec. Sec. 585.213
and 585.214, BOEM may provide the following auction information, as
appropriate, in the PSN and FSN:
(1) Bidding instructions, procedures, and systems, including the
bid variables. How the auction will be conducted and what systems and
procedures will be utilized.
(2) Bid deposit. The amount a bidder must pay under Sec.
585.501(a) to be eligible to bid. The FSN will prescribe the process
and deadline for submitting a bid deposit.
(3) Mock auction. Notice of a practice auction before the actual
auction. Only bidders eligible for the actual auction will be permitted
to participate in the mock (i.e., practice) auction.
(4) Auction date, starting time and location. The starting time
will include the relevant time zone, and the location will indicate
where the auction will take place.
(5) Minimum bid. The price at which the bidding will start.
(6) Information BOEM will release to bidders between rounds. This
information may include prior round results and other updates.
(7) Tie-breaking provision. This provision describes the method
that BOEM will use to break a tie between two or more identical high
bids offered for the same lease area, or package of lease areas.
(8) Next highest bidder. The method that BOEM will use to determine
the next highest bidder of a completed auction in the event the
provisional winner fails to meet its obligations or is unable to
acquire a lease for any reason, or if a competitively issued lease or
any portion thereof is relinquished or cancelled within six months of
the auction.
(b) The list in paragraph (a) of this section is not exhaustive.
BOEM may include in the FSN any other information relevant to that
auction.
Competitive Lease Award Process--Post-Auction Provisions
Sec. 585.224 What will BOEM do after the auction?
(a) At the conclusion of the auction, BOEM will:
(1) Declare the bidding closed.
(2) Assess whether the bids meet the requirements of BOEM's
regulations and the FSN. BOEM may disqualify bids based on this review.
(3) Under 43 U.S.C. 1337(c), provide the Department of Justice, in
consultation with the Federal Trade Commission, the opportunity to
conduct an antitrust review of the lease sale results. BOEM may
disqualify bids based on the results of this review.
(4) BOEM will declare the provisional winner of each lease area.
(b) BOEM may reject any and all bids received, regardless of the
amount offered.
(c) BOEM will accept or reject bids within 90 calendar days of
auction closure; BOEM may extend that time by notice to bidders within
15 calendar days before the 90 calendar day period ends.
(d) BOEM will deem rejected any bid not accepted within the 90
calendar-day period, or any extension. BOEM will provide each rejected
bidder a written explanation for the rejection and will refund, without
interest, any monies deposited by the rejected bidder.
(e) BOEM may withdraw all or part of a lease area from the lease
sale between auction closure and lease execution. In the event that a
portion of the lease area is withdrawn, the provisional winner has the
option to refuse the lease without penalty, to propose new lease terms
for BOEM's concurrence, or to accept the lease with the reduced area.
(f) BOEM may re-auction any lease area or portions thereof that
remain unsold at the conclusion of an auction. BOEM may restart the
competitive
[[Page 42733]]
leasing process at any point in the process set forth in Sec. 585.210
that it deems reasonable and appropriate (e.g., Call, area
identification, PSN, or FSN).
Sec. 585.225 What happens if BOEM accepts a bid?
(a) BOEM will identify and notify the lease area's provisional
winner of the amount due on each winning bid, which equals the cash
component of the provisional winner's bid less its bid deposit retained
by BOEM under Sec. 585.501. BOEM will provide an unsigned copy of the
lease to the provisional winner.
(b) Within 10 business days after receipt of the unsigned copy, or
as otherwise specified by BOEM under paragraph (d) of this section, the
provisional winner must:
(1) Execute the lease and return it to BOEM;
(2) File financial assurance as required by Sec. Sec. 585.516
through 585.529; and
(3) Pay the amount due.
(c) When the bid deposit exceeds the amount due, BOEM will refund
the overage without interest.
(d) A provisional winner may request in writing an extension of the
10-day time limit in paragraph (b) of this section. BOEM, in its
discretion, may grant such a request.
(e) BOEM will execute the lease by signing the lease on behalf of
the United States only after the provisional winner completes the
requirements in paragraph (b) of this section and any appeals timely
filed under Sec. 585.118(c)(1) have been resolved. After BOEM executes
the lease, the provisional winner becomes the winning bidder, and BOEM
will send the winning bidder an electronic version of the fully
executed copy of the lease. The lease takes effect as set forth in
Sec. 585.237.
(f) The winning bidder must pay the first 12 months' rent under
Sec. 585.503(a) within 45 calendar days after receiving a copy of the
executed lease from BOEM.
(g) In the event that a lessee does not meet the commitments it
made to obtain any bidding credits, the lessee will be required to
repay the value of the bidding credits that it received adjusted for
inflation.
Sec. 585.226 What happens if the provisional winner fails to meet its
obligations?
(a) If BOEM determines that a provisional winner has failed to
timely complete the steps outlined in Sec. 585.225(b) or Sec.
585.316, or has otherwise failed to comply with applicable laws,
regulations, or FSN provisions, BOEM may take one or more of the
following actions:
(1) Decline to execute the applicable lease.
(2) Decline to execute the lease for any other lease areas that the
provisional winner won during the auction.
(3) Require forfeiture of the bid deposit. In the event the bid
deposit exceeds the amount of the winning bid, BOEM would limit the
required forfeiture to the lesser amount.
(4) Refer the matter to the Department of the Interior's
Administrative Remedies Division for suspension or debarment review
pursuant to 2 CFR part 180 as implemented at 2 CFR part 1400.
(5) Pursue any other remedy available.
(b) If BOEM declines to execute a lease with the provisional winner
under paragraph (a) of this section, BOEM may decide to select a new
provisional winner by either repeating the auction under Sec.
585.224(f), or pursuant to the procedures in Sec. 585.223(a)(8), by
selecting the next highest bid submitted during the auction, or by
using other procedures specified in the FSN.
(c) BOEM's decisions under this section are appealable under Sec.
585.118.
Sec. Sec. 585.227-585.229 [Reserved]
Noncompetitive Lease Award Process
Sec. 585.230 May I request a lease if there is no Call?
You may submit an unsolicited request for a commercial lease or a
limited lease under this part. Your unsolicited request must contain
the following information:
(a) The area you are requesting for lease.
(b) A general description of your objectives and the facilities
that you would use to achieve those objectives.
(c) A general schedule of proposed activities including those
leading to commercial operations.
(d) Available and pertinent data and information concerning
renewable energy and environmental conditions in the area of interest,
including energy and resource data and information used to evaluate the
area of interest. BOEM will withhold trade secrets and commercial or
financial information that is privileged or confidential from public
disclosure under exemption 4 of the FOIA and as provided in Sec.
585.114.
(e) If available from the appropriate State or local government
authority, a statement that the proposed activity conforms with State
and local energy planning requirements, initiatives, or guidance.
(f) Documentation showing that you meet the qualifications to
become a lessee, as specified in Sec. Sec. 585.107 and 585.108.
(g) An acquisition fee, as specified in Sec. 585.502(a).
Sec. 585.231 Will BOEM issue leases noncompetitively?
(a) BOEM will consider unsolicited requests for a lease on a case-
by-case basis and may issue a lease noncompetitively in accordance with
this part. BOEM will issue a lease noncompetitively only if it has
determined after public notice that no competitive interest exists.
BOEM will not consider an unsolicited request for a lease under this
part that is proposed in a lease area that is scheduled for a lease
auction under this part.
(b) At BOEM's discretion, BOEM may issue an RFI under Sec. 585.116
relating to your unsolicited lease request and will consider comments
received to determine if competitive interest exists. If BOEM decides
not to issue an RFI and, therefore, not to continue processing your
unsolicited lease request, it will refund your acquisition fee.
(c) If BOEM determines that competitive interest exists in the
lease area:
(1) BOEM will proceed with the competitive process set forth in
Sec. Sec. 585.210 through 585.226;
(2) If you submit a bid for the lease area in a competitive lease
sale, your acquisition fee will be applied to the deposit for your
bonus bid; and
(3) If you do not submit a bid for the lease area in a competitive
lease sale, BOEM will not refund your acquisition fee.
(d) If BOEM determines that there is no competitive interest in a
lease and that further investigation of the area is in the public
interest, it will:
(1) Publish in the Federal Register a determination of no
competitive interest.
(2) Prepare and provide you with a written estimate of the proposed
fee to pay for the processing costs under Sec. 585.112, including any
environmental review that BOEM may require before lease issuance.
(3) Conduct environmental reviews required by Federal law and
consult with affected Federal agencies, federally recognized Indian
Tribes, and State and local governments.
(e) The following deadlines apply after issuance of a determination
of no competitive interest:
(1) Within 90 calendar days of receiving the written estimate of
the fee, or longer (as determined at BOEM's discretion), you must pay
the fee for any environmental review under Sec. 585.112.
[[Page 42734]]
Failure to pay the required fee may result in withdrawal of the
determination of no competitive interest.
(2) A determination of no competitive interest expires two years
after its publication, unless BOEM determines that it should be
extended for good cause. BOEM reserves the right to withdraw a
determination of no competitive interest before it expires if BOEM
determines that you have failed to exercise due diligence in obtaining
a lease.
(f) After BOEM publishes the determination of no competitive
interest, you will be responsible for submitting any consistency
certification and necessary data and information in a timely manner to
the applicable State CZMA agencies and BOEM pursuant to 15 CFR part
930, subpart D.
(g) After completing its review of your lease request, BOEM may
offer you a noncompetitive lease.
(h) If you accept the terms and conditions of the lease, BOEM will
issue the lease. You must comply with the terms and conditions of your
lease and the applicable provisions of this part. If BOEM issues you a
lease, BOEM will send you an electronic copy of the lease form.
(1) Within 10 business days after you receive the lease you must:
(i) Execute and return the lease; and
(ii) File financial assurance as required under Sec. Sec. 585.516
through 585.529.
(2) You must pay the first 12 months' rent no later than 45
calendar days after you receive your copy of the executed lease from
BOEM under Sec. 585.503(a)(1).
(i) BOEM will publish in the Federal Register a notice announcing
the issuance of your lease.
(j) If you do not accept the terms and conditions in a timely
manner, BOEM will not issue a lease. Additionally, if you do not comply
with the requirements for financial assurance, BOEM may decide not to
issue a lease. If BOEM does not issue a lease due to your noncompliance
or non-acceptance, BOEM will not refund your acquisition fee, or any
fees paid under paragraph (e)(1) of this section.
Sec. 585.232 May I acquire a lease noncompetitively after responding
to a request for information or a Call for Information and Nominations?
(a) If you submit an area of interest for a possible lease and BOEM
receives no competing submissions in response to the RFI or Call, we
may inform you that there does not appear to be competitive interest,
and ask if you wish to proceed with acquiring a lease.
(b) If you wish to proceed with acquiring a lease, you must submit
your acquisition fee as specified in Sec. 585.502(a).
(c) After receiving the acquisition fee, BOEM will follow the
process outlined in Sec. 585.231(d) through (j).
Sec. Sec. 585.233-585.234 [Reserved]
Commercial and Limited Lease Periods
Sec. 585.235 What are the lease periods for a commercial lease?
(a) The lease periods within the term of your commercial lease are
defined as follows:
(1) Preliminary period. Each commercial lease has a preliminary
period of up to five years. During the preliminary period, the lessee
must submit a COP. The preliminary period begins on the effective date
of the lease and ends either when a COP is received by BOEM for review
or at the expiration of five years, whichever occurs first.
(2) COP review period. A commercial lease has a COP review period.
The COP review period begins when BOEM receives a COP from the lessee
and ends upon COP approval, disapproval, or approval with conditions
pursuant to Sec. 585.628. During the COP review period, BOEM conducts
the necessary reviews and consultations associated with the COP.
(3) Design and construction period. The design and construction
period begins at COP approval and ends when the operations period
begins. During the design and construction period BSEE completes the
FDR and FIR review(s), and the lessee undertakes project construction.
(4) Operations period. A commercial lease has an operations period
of 35 years; or the duration specified in the lease; or the duration
included and approved as part of your COP. The operations period begins
when the requirements of 30 CFR 285.637(a) are met through the
submission of final reports and records for your project. Additional
time may be added to the operations period through a lease suspension
under Sec. 585.415 issued during this period; a lease extension
requested pursuant to paragraph (b) of this section; or a lease renewal
under Sec. 585.425.
(b) You may request an extension of any of the lease periods
outlined in paragraph (a) of this section for good cause, including if
the project is designed and verified for a longer duration. In its
discretion, BOEM may approve your request.
(c) If you intend to develop your lease in phases under Sec.
585.238, you must propose lease period schedules for each phase in your
COP.
(d) If you intend to segregate or consolidate your lease under
Sec. Sec. 585.408 through 585.413, you and your assignees may propose
lease period schedules in your segregation or consolidation
application.
Sec. 585.236 If I have a limited lease, how long will my lease remain
in effect?
(a) For limited leases, the lease periods are as shown in the
following table:
------------------------------------------------------------------------
Extension or
Lease period suspension Requirements
------------------------------------------------------------------------
(1) Each limited lease has a If we receive a GAP The GAP must
preliminary period of 12 that satisfies the meet the
months within which to submit requirements of Sec. requirements of
a GAP. The preliminary period Sec. 585.640 Sec. Sec.
begins on the effective date through 585.648, the 585.640 through
of the lease. preliminary period 585.648.
will be automatically
extended for the
period of time
necessary for us to
conduct a technical
and environmental
review of the GAP.
(2) Each limited lease has an We may order or grant
operations period as a suspension of the
specified by BOEM (if the operations period as
lease is issued provided in Sec.
competitively) or negotiated Sec. 585.415
with the applicant (if the through 585.421.
lease is issued
noncompetitively). In either
case, the duration of the
operations period will depend
on the intended use of the
lease. The operations period
begins on the date that we
approve your GAP.
------------------------------------------------------------------------
(b) You may request an extension of any of the lease periods
outlined in paragraph (a) of this section for good cause. In its
discretion, BOEM may approve your request.
[[Page 42735]]
Sec. 585.237 What is the effective date of a lease?
(a) A lease issued under this part must be dated and becomes
effective as of the first day of the month following the date a lease
is signed by the lessor.
(b) If the lessee submits a written request and BOEM approves, a
lease may be dated and become effective the first day of the month in
which it is signed by the lessor.
Sec. 585.238 May I develop my commercial lease in phases?
In your COP, you may request development of your commercial lease
in phases. In support of your request, you must provide details as to
what portions of the lease will be initially developed for commercial
operations and what portions of the lease will be reserved for
subsequent phased development. You must also propose a lease period
schedule for each phase described in your COP in accordance with Sec.
585.235(c). BOEM may condition its approval of subsequent phases
described in a phased development COP.
Sec. 585.239 Are there any other renewable energy research activities
that will be allowed on the OCS?
(a) The Director may issue OCS leases, ROW grants, and RUE grants
to a Federal agency or a State for renewable energy research activities
that support the future production, transportation, or transmission of
renewable energy.
(b) In issuing leases, ROW grants, and RUE grants to a Federal
agency or a State on the OCS for renewable energy research activities
under this section, BOEM will coordinate and consult with other
relevant Federal agencies, affected federally recognized Indian Tribes,
any other affected State(s), and affected local government executives.
(c) BOEM may issue leases, RUEs, and ROWs for research activities
managed by a Federal agency or a State only in areas for which the
Director has determined, after public notice and opportunity to
comment, that no competitive interest exists.
(d) The Director and the head of the Federal agency or the Governor
of a requesting State, or their authorized representatives, will
negotiate the terms and conditions of such renewable energy leases,
RUEs, or ROWs under this section on a case-by-case basis. The framework
for such negotiations, and standard terms and conditions of such
leases, RUEs, or ROWs may be set forth in a memorandum of agreement
(MOA) or other agreement between BOEM and a Federal agency or a State.
The MOA must include the agreement of the head of the Federal agency or
the Governor to assure that all subcontractors comply with this part
and 30 CFR part 285, other applicable laws, and terms and conditions of
such leases or grants.
(e) Any lease, RUE, or ROW that BOEM issues to a Federal agency or
to a State that authorizes access to an area of the OCS for research
activities managed by a Federal agency or a State must include:
(1) Requirements to comply with all applicable Federal laws; and
(2) Requirements to comply with this part and 30 CFR part 285,
except as otherwise provided in the lease or grant.
(f) BOEM will issue a public notice of any lease, RUE, or ROW
issued to a Federal agency or to a State, or an approved MOA for such
research activities.
(g) BOEM will not charge any fees for the purpose of ensuring a
fair return for the use of such research areas on the OCS.
Sec. Sec. 585.240-585.299 [Reserved]
0
48. Revise subpart D to read as follows:
Subpart D--Right-of-Way (ROW) Grants and Right-of-Use and Easement
(RUE) Grants for Renewable Energy Activities
Sec.
ROW Grants and RUE Grants
585.300 What types of activities are authorized by ROW grants and
RUE grants issued under this part?
585.301 What do ROW grants and RUE grants include?
585.302 What are the general requirements for ROW grant and RUE
grant holders?
585.303 How long will my ROW grant or RUE grant remain in effect?
585.304 [Reserved]
Obtaining ROW Grants and RUE Grants
585.305 How do I request a ROW grant or a RUE grant?
585.306 What action will BOEM take on my request?
585.307 How will BOEM determine whether competitive interest exists
for ROW grants and RUE grants?
585.308 How will BOEM conduct an auction for ROW grants and RUE
grants?
585.309 What is the effective date of a ROW grant or a RUE grant?
585.310-585.314 [Reserved]
Financial Requirements for ROW Grants and RUE Grants
585.315 What deposits are required for a competitive ROW grant or
RUE grant?
585.316 What payments are required for ROW grants or RUE grants?
585.317-585.399 [Reserved]
Subpart D--Right-of-Way (ROW) Grants and Right-of-Use and Easement
(RUE) Grants for Renewable Energy Activities
ROW Grants and RUE Grants
Sec. 585.300 What types of activities are authorized by ROW grants
and RUE grants issued under this part?
(a) A ROW grant authorizes the holder to install on the OCS cables,
pipelines, and associated facilities that involve the transportation or
transmission of electricity or other energy product from renewable
energy projects.
(b) A RUE grant authorizes the holder to construct and maintain
facilities or other installations on the OCS that support the
production, transportation, or transmission of electricity or other
energy product from any renewable energy resource.
(c) You do not need a ROW grant or RUE grant for a project easement
authorized under Sec. 585.200(b) to serve your lease.
Sec. 585.301 What do ROW grants and RUE grants include?
(a) A ROW grant:
(1) Includes the full length of the corridor on which a cable,
pipeline, or associated facility is located;
(2) Is of a width sufficient to accommodate potential changes at
the design and installation phases of the project, with an option for
the grant holder to relinquish unused portions of the ROW after
construction is complete; and
(3) For the associated facilities, is limited to the area
reasonably necessary for a power or pumping station or other facilities
requested.
(b) A RUE grant includes the site on which a facility or other
structure is located and the areal extent of anchors, chains, and other
equipment associated with a facility or other structure. The specific
boundaries of a RUE will be determined by BOEM on a case-by-case basis
and set forth in each RUE grant.
Sec. 585.302 What are the general requirements for ROW grant and RUE
grant holders?
(a) To acquire a ROW grant or RUE grant, you must provide evidence
that you meet the qualifications set forth in Sec. Sec. 585.107 and
585.108.
(b) A ROW grant or RUE grant is subject to the following
conditions:
(1) The rights granted will not prevent the granting of other
rights by the United States, either before or after the granting of the
ROW or RUE, provided that any subsequent authorization issued by BOEM
in the area of a previously issued ROW grant or RUE
[[Page 42736]]
grant may not unreasonably interfere with activities approved or impede
existing operations under such a grant; and
(2) The holder agrees that the United States, its lessees, or other
ROW grant or RUE grant holders may use or occupy any part of the ROW
grant or RUE grant not actually occupied or necessarily incident to its
use for any necessary activities.
Sec. 585.303 How long will my ROW grant or RUE grant remain in
effect?
The periods within the term of your grant are defined as follows:
(a) Each ROW or RUE grant has a preliminary period of 12 months
from the effective date of the ROW or RUE grant within which to submit
a GAP. The preliminary period begins on the effective date of the
grant. You must submit a GAP no later than the end of the preliminary
period for your grant to remain in effect. However, you may submit a
GAP before the issuance of your ROW or RUE grant.
(b) Each ROW or RUE grant has an operations period as set by BOEM
(if the grant is issued competitively) or negotiated with the applicant
(if the grant is issued noncompetitively). In either case, the duration
of the operations period will depend on the intended use of the grant.
The operations period begins on the date that we approve your GAP.
(c) You may request an extension of any of the grant periods
outlined in paragraphs (a) and (b) of this section for good cause. In
its discretion, BOEM may approve your request.
Sec. 585.304 [Reserved]
Obtaining ROW Grants and RUE Grants
Sec. 585.305 How do I request a ROW grant or a RUE grant?
You must submit a request for a new or modified ROW grant or RUE
grant to BOEM pursuant to Sec. 585.111. You must submit a separate
request for each ROW grant or RUE grant you are requesting. The request
must contain the following information:
(a) The area you are requesting for a ROW grant or RUE grant.
(b) A general description of your objectives and the facilities
that you would use to achieve those objectives.
(c) A general schedule of proposed activities.
(d) Pertinent information concerning environmental conditions in
the area of interest.
Sec. 585.306 What action will BOEM take on my request?
BOEM will consider requests for ROW grants and RUE grants on a
case-by-case basis and may issue a grant competitively, as provided in
Sec. 585.308, or noncompetitively if we determine after public notice
that there is no competitive interest. BOEM will coordinate and consult
with relevant Federal agencies, the Governor of any affected State, and
the executive of any affected local government.
(a) In response to an unsolicited request for a ROW grant or RUE
grant, BOEM will first determine if there is competitive interest, as
provided in Sec. 585.307.
(b) If BOEM determines there is no competitive interest in a ROW or
RUE grant, BOEM will publish a notice in the Federal Register of such
determination. After BOEM publishes this notice, you are responsible
for submitting any required consistency certification and necessary
data and information in a timely manner to BOEM and the applicable
State CZMA agency pursuant to 15 CFR part 930, subpart D. BOEM may
establish terms and conditions for a noncompetitive grant and offer the
grant to you:
(1) If you accept the terms and conditions of the grant, BOEM will
issue the grant.
(2) If you do not accept the terms and conditions of the grant,
BOEM may agree to modify the terms and conditions or may decide not to
issue the grant.
Sec. 585.307 How will BOEM determine whether competitive interest
exists for ROW grants and RUE grants?
To determine whether or not there is competitive interest:
(a) We will publish a public notice, generally describing the
parameters of the project, to give affected and interested parties an
opportunity to comment on the proposed ROW grant or RUE grant area.
(b) We will evaluate any comments received on the notice and make a
determination of the level of competitive interest.
(c) BOEM may consider a State's or Regional Transmission Operator/
Independent System Operator's process that identifies a transmission
project that needs a ROW and/or a RUE grant to achieve its intended
purpose. BOEM may determine that there is no competitive interest that
would be consistent with OCSLA's goal of allowing the expeditious and
orderly development of OCS energy projects, if offering the ROW and/or
RUE competitively could challenge the viability of the transmission
project intended to be located on State submerged lands and the OCS
(e.g., technical and economic feasibility or practicality concerns,
including significant delays, by having different entities holding the
right to develop the transmission project in State submerged lands and
the OCS).
Sec. 585.308 How will BOEM conduct an auction for ROW grants and RUE
grants?
(a) If BOEM determines that there is competitive interest, we will:
(1) Publish a notice of each grant auction in the Federal Register
describing auction procedures, allowing interested persons 30 days to
comment; and
(2) Conduct a competitive auction for issuing the ROW grant or RUE
grant. The auction process for ROW grants and RUE grants will be
conducted following the same process for leases set forth in Sec. Sec.
585.210 through 585.226.
(b) If you are the successful bidder in an auction, you must pay
the first year's rent, as provided in Sec. 585.316.
Sec. 585.309 What is the effective date of a ROW grant or a RUE
grant?
Your ROW grant or RUE grant becomes effective on the date
established by BOEM on the ROW grant or RUE grant instrument.
Sec. Sec. 585.310-585.314 [Reserved]
Financial Requirements for ROW Grants and RUE Grants
Sec. 585.315 What deposits are required for a competitive ROW grant
or RUE grant?
(a) You must make a deposit, as required in Sec. 585.501(a),
regardless of whether the auction is a sealed-bid, oral, electronic, or
other auction format. BOEM will specify in the sale notice the official
to whom you must submit the payment, the time by which the official
must receive the payment, and the forms of acceptable payment.
(b) If your high bid is rejected, we will provide a written
statement of reasons.
(c) For all rejected bids, we will refund, without interest, any
money deposited with your bid.
Sec. 585.316 What payments are required for ROW grants or RUE grants?
Before we issue the ROW grant or RUE grant, you must pay:
(a) Any balance on accepted high bids to Office of Natural
Resources Revenue (ONRR), as provided in the sale notice.
(b) An annual rent for the first year of the grant, as specified in
Sec. 585.508.
Sec. Sec. 585.317-585.399 [Reserved]
0
49. Revise subpart E to read as follows:
[[Page 42737]]
Subpart E--Lease and Grant Administration
Sec.
585.400-585.404 [Reserved]
Designation of Operator
585.405 How do I designate an operator?
585.406 Who is responsible for fulfilling lease and grant
obligations?
585.407 [Reserved]
Lease or Grant Assignment, Segregation, and Consolidation
585.408 May I assign my lease or grant interest?
585.409 How do I request approval of a lease or grant assignment?
585.410 When will my assignment result in a segregated lease?
585.411 How does an assignment affect the assignor's liability?
585.412 How does an assignment affect the assignee's liability?
585.413 How do I consolidate leases or grants?
585.414 [Reserved]
Lease or Grant Suspension
585.415 What is a lease or grant suspension?
585.416 How do I request a lease or grant suspension?
585.417 When may BOEM order a suspension?
585.418 How will BOEM issue a suspension?
585.419 What are my immediate responsibilities if I receive a
suspension order?
585.420 What effect does a suspension order have on my payments?
585.421 How long will a lease or grant suspension be in effect?
Lease or Grant Cancellation
585.422 When can my lease or grant be canceled?
585.423-585.424 [Reserved]
Lease or Grant Renewal
585.425 May I obtain a renewal of my lease or grant before it
terminates?
585.426 When must I submit my request for renewal?
585.427 How long is a renewal?
585.428 What effect does applying for a renewal have on my
activities and payments?
585.429 What criteria will BOEM consider in deciding whether to
renew a lease or grant?
585.430-585.431 [Reserved]
Lease or Grant Termination
585.432 When does my lease or grant terminate?
585.433 What must I do after my lease or grant terminates?
585.434 When may BOEM authorize facilities to remain in place
following termination of a lease or grant?
Lease or Grant Relinquishment, Contraction, or Cancellation
585.435 How can I relinquish a lease or a grant or parts of a lease
or grant?
585.436 Can BOEM require lease or grant contraction?
585.437 [Reserved]
585.438 What happens to leases or grants (or portions thereof) that
have been relinquished, contracted, or cancelled?
585.439-585.499 [Reserved]
Subpart E--Lease and Grant Administration
Sec. Sec. 585.400-585.404 [Reserved]
Designation of Operator
Sec. 585.405 How do I designate an operator?
(a) If you intend to designate an operator who is not the lessee or
grant holder, you must identify the proposed operator in your SAP
(under Sec. 585.610(a)(3)), COP (under Sec. 585.626(a)(2)), or GAP
(under Sec. 585.645(a)(2)), as applicable. If no operator is
designated in a SAP, COP, or GAP, BOEM will deem the lessee or grant
holder to be the operator.
(b) An operator must be designated in any SAP, COP, or GAP if there
is more than one lessee or grant holder for any individual lease or
grant.
(c) Once approved in your plan, the designated operator is
authorized to act on your behalf and required to perform activities
necessary to comply with the OCS Lands Act, the lease or grant, and the
regulations in this part.
(d) You, or your designated operator, must immediately provide BOEM
with a written notification of change of address of the lessee or
operator.
(e) If there is a change in the designated operator, you must
provide written notice to BOEM and identify the new designated operator
within 72 hours on a form approved by BOEM. The lessee(s) or grantee(s)
is the operator and responsible for compliance until BOEM approves
designation of the new operator.
(f) Designation of an operator under any lease or grant issued
under this part does not relieve the lessee or grant holder of its
obligations under this part or its lease or grant.
(g) A designated operator performing activities on the lease must
comply with all regulations governing those activities and may be held
liable or penalized for any noncompliance during the time it was the
operator, notwithstanding its subsequent resignation.
Sec. 585.406 Who is responsible for fulfilling lease and grant
obligations?
(a) When you are not the sole lessee or grantee, you and your co-
lessee(s) or co-grantee(s) are jointly and severally responsible for
fulfilling your obligations under the lease or grant and the provisions
of this part and 30 CFR part 285, unless otherwise provided in this
part.
(b) If your designated operator fails to fulfill any of your
obligations under the lease or grant and this part, BOEM may require
you or any or all of your co-lessees or co-grantees to fulfill those
obligations or other operational obligations under the OCS Lands Act,
the lease, grant, or this part.
(c) Whenever the regulations in this part require the lessee or
grantee to conduct an activity in a prescribed manner, the lessee or
grantee and operator (if one has been designated) are jointly and
severally responsible for complying with this part.
Sec. 585.407 [Reserved]
Lease or Grant Assignment, Segregation, and Consolidation
Sec. 585.408 May I assign my lease or grant interest?
(a) You may assign all or part of your lease or grant interest,
including record title, to one or more parties, subject to BOEM
approval under this subpart. Each instrument that creates or transfers
an interest must describe the entire tract or describe by officially
designated subdivisions the interest you propose to create or transfer.
Your application to assign a lease or grant may include a request to
modify the existing lease or grant period schedule consistent with
Sec. 585.235(d).
(b) If you submit an application to assign a lease or grant, you
will continue to be responsible for payments that are or become due on
the lease or grant until the date BOEM approves the assignment.
(c) The assignment takes effect on the first day of the month
following the date on which BOEM approves your request, unless you
request an earlier effective date and BOEM approves that earlier date,
but such earlier effective date, if prior to the date of BOEM's
approval, does not relieve you of your obligations accrued between that
earlier effective date and the date of approval.
(d) You do not need to request an assignment for business mergers,
name changes, or changes of business form. You must notify BOEM of
these events under Sec. 585.110.
Sec. 585.409 How do I request approval of a lease or grant
assignment?
(a) You must request approval of each assignment on a form approved
by BOEM and submit originals of each instrument that creates or
transfers ownership of record title or certified copies thereof within
90 days after the last party executes the transfer agreement.
[[Page 42738]]
(b) Any assignee will be subject to all the terms and conditions of
your original lease or grant, including the requirement to furnish
financial assurance in the amount required in Sec. Sec. 585.516
through 585.537.
(c) The assignee must submit proof of eligibility and other
qualifications specified in Sec. Sec. 585.107 and 585.108.
(d) Persons executing on behalf of the assignor and assignee must
furnish evidence of authority to execute the assignment.
Sec. 585.410 When will my assignment result in a segregated lease?
(a) When there is an assignment by all record title owners of 100
percent of the record title to one or more aliquots in a lease, the
assigned and retained portions become segregated into separate and
distinct leases. In such a case, both the new lease and the remaining
portion of the original lease are referred to as ``segregated leases''
and the assignee becomes the record title owner of the new lease, which
is subject to all the terms and conditions of the original lease. The
financial assurance requirements of subpart F of this part apply
separately to each segregated lease.
(b) If a record title owner transfers an undivided interest of less
than 100 percent of the record title interest in any given aliquot,
that transfer will not segregate the portions of that aliquot, or the
whole aliquot, in which part of the record title was transferred, into
a separate lease from the portions in which no interest was
transferred. Instead, that transfer will create a joint ownership
between the assignee and assignor in the portions of the lease in which
part of the record title interest was transferred.
(c) When a lease becomes segregated, BOEM may issue separate Plan
approvals for a segregated lease or take other actions within its
discretion.
Sec. 585.411 How does an assignment affect the assignor's liability?
As assignor, you are liable for all obligations, monetary and
nonmonetary, that accrued under your lease or grant before BOEM
approves your assignment. Our approval of the assignment does not
relieve you of these accrued obligations. BOEM may require you to bring
the lease or grant into compliance to the extent the obligation accrued
before the effective date of your assignment if your assignee or
subsequent assignees fail to perform any obligation under the lease or
grant.
Sec. 585.412 How does an assignment affect the assignee's liability?
(a) As assignee, you are liable for all lease or grant obligations
that accrue after BOEM approves the assignment. As assignee, you must
comply with all the terms and conditions of the lease or grant and all
applicable regulations, remedy all existing environmental and
operational problems on the lease or grant, and comply with all
decommissioning requirements under 30 CFR part 285, subpart I.
(b) Assignees are bound to comply with each term or condition of
the lease or grant and the regulations in this part and 30 CFR part
285. You are jointly and severally liable for the performance of all
obligations under the lease or grant and under the regulations in this
part and 30 CFR part 285 with each prior and subsequent lessee who held
an interest from the time the obligation accrued until it is satisfied,
unless this part provides otherwise.
Sec. 585.413 How do I consolidate leases or grants?
(a) You may apply to consolidate all or part of two or more
adjacent leases or grants held by the same lessee or grant holder into
one new lease or grant, subject to BOEM's approval. The application
must include a description of the leases or grants, or portions
thereof, to be consolidated, including the relevant lease number, lease
blocks, and aliquots.
(b) An approved consolidation will create a new lease or grant that
will be subject to the terms and conditions of the consolidated leases
or grants.
(c) To the extent the leases or grants to be consolidated have
different times remaining in the relevant lease or grant periods, BOEM
will default to using the shorter remaining periods in the new lease or
grant but will consider requests for a revised lease or grant period
schedule included in the consolidation application.
(d) To the extent the leases or grants to be consolidated have
other different terms and conditions, BOEM will default to using the
terms and conditions in the most recently issued lease or grant to be
consolidated for the new lease. BOEM will consider requests for
modifications on a case-by-case basis and, in its discretion, approve
such requests for good cause.
(e) Before BOEM will approve your consolidation request, BOEM will
assess appropriate financial assurance obligations for the new lease or
grant per Sec. Sec. 585.516 and 585.517 or Sec. Sec. 585.520 and
585.521.
(f) Any consolidated leases and grants that have been absorbed into
the new lease or grant in their entirety will be considered terminated
at the time of consolidation approval.
Sec. 585.414 [Reserved]
Lease or Grant Suspension
Sec. 585.415 What is a lease or grant suspension?
(a) A suspension is an interruption of the period of your lease or
grant that may occur:
(1) As approved by BOEM at your request, as provided in Sec.
585.416; or
(2) As ordered by BOEM, as provided in Sec. 585.417 or by BSEE as
provided in 30 CFR 285.417.
(b) A lease or grant suspension extends the expiration date for the
relevant period of your lease or grant for the length of time the
suspension is in effect.
(c) Activities may not be conducted on your lease or grant during
the period of a suspension except as expressly authorized under the
terms of the lease or grant suspension.
Sec. 585.416 How do I request a lease or grant suspension?
(a) You must submit a written request to BOEM that includes the
following information no later than 90 calendar days before the
expiration of your appropriate lease or grant period:
(1) The reasons you are requesting suspension of your lease or
grant, including an explanation why the suspension is necessary.
(2) The length of additional time requested.
(3) An explanation why it is in the public interest to approve the
suspension.
(4) Any other information BOEM may require.
(b) If you are unable to timely submit a COP or GAP, as required,
you may request a suspension to extend the preliminary period of your
lease or grant. Your request must include a revised schedule for
submission of your COP or GAP, as appropriate.
Sec. 585.417 When may BOEM order a suspension?
BOEM may order a suspension under the following circumstances:
(a) When necessary to comply with judicial decrees prohibiting some
or all activities under your lease; or
(b) When the suspension is necessary for reasons of national
security or defense.
Sec. 585.418 How will BOEM issue a suspension?
(a) BOEM will issue a suspension order orally or in writing.
[[Page 42739]]
(b) BOEM will send you a written suspension order as soon as
practicable after issuing an oral suspension order.
(c) The written order will explain the reasons for its issuance and
describe the effect of the suspension order on your lease or grant and
any associated activities. BOEM may authorize certain activities during
the period of the suspension, as set forth in the suspension order.
Sec. 585.419 What are my immediate responsibilities if I receive a
suspension order?
You must comply with the terms of a suspension order upon receipt
and take any action prescribed within the time set forth therein.
Sec. 585.420 What effect does a suspension order have on my payments?
(a) While BOEM evaluates your request for a suspension under Sec.
585.416, you must continue to fulfill your payment obligation until the
end of the original term of your lease or grant. If our evaluation goes
beyond the end of the original term of your lease or grant, the term of
your lease or grant will be extended for the period of time necessary
for BOEM to complete its evaluation of your request, but you will not
be required to make payments during the time of the extension.
(b) If BOEM approves your request for a suspension under Sec.
585.416, or orders a suspension under Sec. 585.417, BOEM may waive or
defer your payment obligations during the suspension. BOEM's decision
to waive or defer payments will depend on the reasons for the
suspension, including your responsibility for the circumstances
necessitating a suspension.
Sec. 585.421 How long will a lease or grant suspension be in effect?
A lease or grant suspension will be in effect for the period
specified by BOEM.
(a) BOEM will not approve a lease or grant suspension request
pursuant to Sec. 585.416 for a period longer than 2 years.
(b) If BOEM determines that the circumstances giving rise to a
suspension ordered under Sec. 585.417 cannot be resolved within 5
years, the Secretary may initiate cancellation of the lease or grant.
Lease or Grant Cancellation
Sec. 585.422 When can my lease or grant be canceled?
(a) The Secretary will cancel any lease or grant issued under this
part upon proof that it was obtained by fraud or misrepresentation, and
after notice and opportunity to be heard has been afforded to the
lessee or grant holder.
(b) The Secretary may cancel any lease or grant issued under this
part when:
(1) The Secretary determines after notice and opportunity for a
hearing that, with respect to the lease or grant that would be
canceled, the lessee or grantee has failed to comply with any
applicable provision of the OCS Lands Act or this part; any order of
the Director; or any term, condition, or stipulation contained in the
lease or grant, and that the failure to comply continued 30 days (or
other period BOEM specifies) after you receive notice from BOEM. The
Secretary will mail a notice by registered or certified letter to the
lessee or grantee at its record post office address;
(2) The Secretary determines after notice and opportunity for a
hearing that you have terminated commercial operations under your COP,
as provided in Sec. 585.635, or other approved activities under your
GAP, as provided in Sec. 585.656;
(3) Required by national security or defense; or
(4) The Secretary determines after notice and opportunity for a
hearing that continued activity under the lease or grant:
(i) Would cause serious harm or damage to natural resources; life
(including human and wildlife); property; the marine, coastal, or human
environment; or sites, structures, or objects of historical or
archaeological significance; and
(ii) That the threat of harm or damage would not disappear or
decrease to an acceptable extent within a reasonable period of time;
and
(iii) The advantages of cancellation outweigh the advantages of
continuing the lease or grant in force.
Sec. Sec. 585.423-585.424 [Reserved]
Lease or Grant Renewal
Sec. 585.425 May I obtain a renewal of my lease or grant before it
terminates?
You may request renewal of the operations period of your lease or
the original authorized period of your grant. BOEM, at its discretion,
may approve a renewal request to conduct substantially similar
activities as were originally authorized under the lease or grant. BOEM
will not approve a renewal request that involves development of a type
of renewable energy not originally authorized in the lease or grant.
BOEM may revise or adjust payment terms of the original lease, as a
condition of lease renewal.
Sec. 585.426 When must I submit my request for renewal?
(a) You must request a renewal from BOEM:
(1) No later than 180 days before the termination date of your
limited lease or grant.
(2) No later than two years before the termination date of the
operations period of your commercial lease.
(b) You must submit to BOEM all information we request pertaining
to your lease or grant and your renewal request.
Sec. 585.427 How long is a renewal?
BOEM will set the length of the renewal at the time of renewal on a
case-by-case basis.
(a) For commercial leases, the length of the renewal will not
exceed the original operations period unless a longer time is
negotiated by the parties.
(b) For limited leases, the length of the renewal will not exceed
the original operations period.
(c) For RUE and ROW grants, a renewal will continue for as long as
the associated activities are conducted and facilities properly
maintained and used for the purpose for which the grant was made,
unless otherwise expressly stated.
Sec. 585.428 What effect does applying for a renewal have on my
activities and payments?
If you timely request a renewal:
(a) You may continue to conduct activities approved under your
lease or grant under the original terms and conditions for as long as
your request is pending decision by BOEM.
(b) You may request a suspension of your lease or grant, as
provided in Sec. 585.416, while we consider your request.
(c) For the period BOEM considers your request for renewal, you
must continue to make all payments in accordance with the original
terms and conditions of your lease or grant.
Sec. 585.429 What criteria will BOEM consider in deciding whether to
renew a lease or grant?
BOEM will consider the following criteria in deciding whether to
renew a lease or grant:
(a) Design life of existing technology.
(b) Availability and feasibility of new technology.
(c) Environmental and safety record of the lessee or grantee.
(d) Operational and financial compliance record of the lessee or
grantee.
(e) Competitive interest and fair return considerations.
(f) Effects of the lease or grant on generation capacity and
reliability
[[Page 42740]]
within the regional electrical distribution and transmission system.
(g) Other relevant factors, as appropriate.
Sec. Sec. 585.430-585.431 [Reserved]
Lease or Grant Termination
Sec. 585.432 When does my lease or grant terminate?
Your lease or grant terminates on whichever of the following dates
occurs first:
(a) The expiration of the applicable period of your lease or grant,
unless the relevant period is extended under Sec. 585.235(b) or Sec.
585.236(b), a request for renewal of your lease or grant is pending a
decision by BOEM, or your lease or grant is suspended or renewed as
provided in this subpart, in which case it terminates on the date set
forth in the notice of suspension or renewal;
(b) A cancellation, as set forth in Sec. 585.422; or
(c) Relinquishment, as set forth in Sec. 585.435.
Sec. 585.433 What must I do after my lease or grant terminates?
(a) After your lease or grant terminates, you must:
(1) Make all payments due, including any accrued rentals and
deferred bonuses; and
(2) Perform any other outstanding obligations under the lease or
grant within 6 months.
(b) Within 2 years following termination of a lease or grant, you
must remove or dispose of all facilities, installations, and other
devices permanently or temporarily attached to the seabed on the OCS in
accordance with your BOEM-issued lease for hydrokinetic facilities or
an application approved by BSEE under 30 CFR part 285, subpart I.
(c) If you fail to comply with your BOEM-issued lease for
hydrokinetic facilities or decommissioning application:
(1) BOEM may call for the forfeiture of your financial assurance;
and
(2) You remain liable for removal or disposal costs and responsible
for accidents or damages that might result from such failure.
Sec. 585.434 When may BOEM authorize facilities to remain in place
following termination of a lease or grant?
(a) In your decommissioning application that you submit to BSEE in
accordance with 30 CFR 285.905 and 285.906, you may request that
certain facilities authorized in your lease or grant remain in place
for activities authorized in this part, elsewhere in this subchapter,
or by other applicable Federal laws.
(b) BOEM may approve such requests on a case-by-case basis
considering the following:
(1) Potential impacts to the marine environment;
(2) Competing uses of the OCS;
(3) Impacts on marine safety and national defense;
(4) Maintenance of adequate financial assurance; and
(5) Other factors determined by the Director.
(c) Except as provided in paragraph (d) of this section, if BOEM
authorizes facilities to remain in place, the former lessee or grantee
under this part remains jointly and severally liable for
decommissioning the facility unless satisfactory evidence is provided
to BOEM showing that another party has assumed that responsibility and
has secured adequate financial assurances.
(d) In your decommissioning application, you may request that
certain facilities authorized in your lease or grant be converted to an
artificial reef or otherwise toppled in place. BOEM will evaluate all
such requests.
Lease or Grant Relinquishment, Contraction, or Cancellation
Sec. 585.435 How can I relinquish a lease or a grant or parts of a
lease or grant?
(a) You may surrender a lease or grant, or a designated subdivision
thereof, by filing with BOEM a properly completed official
relinquishment form available on the BOEM website. A relinquishment
takes effect on the date BOEM receives your completed form, subject to
the continued obligation of the lessee or grant holder and the surety
to:
(1) Make all payments due on the lease or grant, including any
accrued rent and deferred bonuses;
(2) Decommission all facilities on the relinquished lease or grant
(or portion thereof) to BSEE's satisfaction; and
(3) Perform any other outstanding obligations under the lease or
grant.
(b) After you submit a completed relinquishment form for a lease or
grant, ONRR will bill you for any outstanding payments that have
accrued from obligations arising under the relinquished lease or grant.
Sec. 585.436 Can BOEM require lease or grant contraction?
At an interval no more frequent than every 5 years, BOEM may review
your lease or grant area to determine whether the lease or grant area
is larger than needed to develop the project and manage activities in a
manner that is consistent with the provisions of this part. BOEM will
notify you of our proposal to contract the lease or grant area.
(a) BOEM will give you the opportunity to present orally or in
writing information demonstrating that you need the area in question to
manage lease or grant activities consistent with this part.
(b) Prior to taking action to contract the lease or grant area,
BOEM will issue a decision addressing your contentions that the area is
needed.
(c) You may appeal this decision under Sec. 585.118.
Sec. 585.437 [Reserved]
Sec. 585.438 What happens to leases or grants (or portions thereof)
that have been relinquished, contracted, or cancelled?
(a) If a lease or grant (or portion thereof) is relinquished,
contracted, or cancelled under Sec. 585.435, Sec. 585.436, or Sec.
585.422, respectively, BOEM may restart the competitive leasing process
at any point set forth in Sec. 585.210 that it deems reasonable and
appropriate (e.g., Call, area identification, PSN, or FSN), subject to
all necessary environmental analyses and consultations.
(b) If a competitively issued lease or grant (or portion thereof)
is relinquished or cancelled under Sec. 585.435 or Sec. 585.422,
respectively, within six months of the auction, BOEM may reoffer the
lease or grant (or portion thereof) to the next highest bidder from
that auction, if one can be identified. If BOEM decides to reoffer to
the next highest bidder, the price will be the next best bid, or a
prorated amount based on the size of the relinquished share, as long as
the next best bid reflects a fair return to the government.
Sec. Sec. 585.439-585.499 [Reserved]
0
50. Revise subpart F to read as follows:
Subpart F--Payments and Financial Assurance Requirements
Sec.
Payments
585.500 How do I make payments under this part?
585.501 What deposits must I submit for a competitively issued
lease, ROW grant, or RUE grant?
585.502 What initial payment requirements must I meet to obtain a
noncompetitive lease, ROW grant, or RUE grant?
585.503 What are the rent and operating fee requirements for a
commercial lease?
585.504 How are my payments affected if I develop my commercial
lease in phases?
585.505 What are the rent and operating fee requirements for a
limited lease?
[[Page 42741]]
585.506 What operating fees must I pay on a commercial lease?
585.507 What rent payments must I pay on a project easement?
585.508 What rent payments must I pay on ROW grants or RUE grants
associated with renewable energy projects?
585.509 Who is responsible for submitting lease or grant payments to
ONRR?
585.510 May BOEM defer, reduce, or waive my lease or grant payments?
585.511-585.515 [Reserved]
Financial Assurance Requirements for Commercial Leases
585.516 What are the financial assurance requirements for each stage
of my commercial lease?
585.517 How will BOEM determine the supplemental financial assurance
associated with commercial leases?
585.518-585.519 [Reserved]
Financial Assurance for Limited Leases, ROW Grants, and RUE Grants
585.520 What financial assurance must I provide when I obtain my
limited lease, ROW grant, or RUE grant?
585.521 Do my financial assurance requirements change as activities
progress on my limited lease or grant?
585.522-585.524 [Reserved]
Requirements for Financial Assurance Instruments
585.525 What general requirements must a financial assurance
instrument meet?
585.526 What instruments other than a surety bond may I use to meet
the financial assurance requirement?
585.527 May I demonstrate financial strength and reliability to meet
the financial assurance requirement for lease or grant activities?
585.528 May I use a third-party guaranty to meet the financial
assurance requirement for lease or grant activities?
585.529 Can I use a lease- or grant-specific decommissioning account
to meet the financial assurance requirements related to
decommissioning?
Changes in Financial Assurance
585.530 What must I do if my financial assurance lapses?
585.531 What happens if the value of my financial assurance is
reduced?
585.532 What happens if my surety wants to terminate the period of
liability of my financial assurance?
585.533 How does my surety obtain cancellation of my financial
assurance?
585.534 When may BOEM cancel my financial assurance?
585.535 Why might BOEM call for forfeiture of my financial
assurance?
585.536 How will I be notified of a call for forfeiture?
585.537 How will BOEM proceed once my bond or other security is
forfeited?
585.538-585.539 [Reserved]
Revenue Sharing With States
585.540 How will BOEM equitably distribute revenues to States?
585.541 What is a qualified project for revenue sharing purposes?
585.542 What makes a State eligible for payment of revenues?
585.543 Example of how the inverse distance formula works.
585.544-585.599 [Reserved]
Subpart F--Payments and Financial Assurance Requirements
Payments
Sec. 585.500 How do I make payments under this part?
(a) For acquisition fees or the initial 12 months' rent paid for
the preliminary period of your lease, you must make your electronic
payments through the Fees for Services page on the BOEM website at
https://www.boem.gov, and you must include one copy of the Pay.gov
confirmation receipt page with your unsolicited request.
(b) For all other required rent payments and for operating fee
payments, you must make your payments as required in 30 CFR 1218.51.
(c) The following table summarizes payments you must make for
leases and grants, unless otherwise specified in the Final Sale Notice:
--------------------------------------------------------------------------------------------------------------------------------------------------------
Payment Amount Due date Payment mechanism Section reference
--------------------------------------------------------------------------------------------------------------------------------------------------------
Initial payments for leases
--------------------------------------------------------------------------------------------------------------------------------------------------------
(1) If your lease is issued Bid Deposit........... As set in Final Sale With bid............. Pay.gov.............. Sec. 585.501.
competitively. Notice/depends on bid.
Bonus Balance......... ...................... Within 10 business 30 CFR 1218.51....... Sec. 585.225.
days of receiving
the unsigned lease.
(2) If your lease is issued non- Acquisition Fee....... $0.25 per acre, unless With application..... Pay.gov.............. Sec. 585.502.
competitively. otherwise set by the
Director.
(3) All leases..................... Initial Rent.......... $3 per acre per year.. Within 45 calendar Pay.gov.............. Sec. 585.503.
days after receiving
your copy of the
executed lease from
BOEM.
--------------------------------------------------------------------------------------------------------------------------------------------------------
Subsequent payments for leases and project easements
--------------------------------------------------------------------------------------------------------------------------------------------------------
(4) All leases..................... Subsequent Rent, $3 per acre per year.. Annually............. 30 CFR 1218.51....... Sec. Sec. 585.503
unless otherwise and 585.504.
provided in the terms
of the lease.
(5) If you have a project easement. Rent, unless otherwise Greater of $5 per acre Upon COP or GAP 30 CFR 1218.51....... Sec. 585.507.
provided in the terms per year or $450 per approval, then
of the grant. year. annually.
(6) If your commercial lease is Operating Fee......... Determined by the Annually............. 30 CFR 1218.51....... Sec. 585.506.
producing. formula in Sec.
585.506.
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Payments for ROW grants and RUE grants \1\
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(7) All ROW grants and RUE grants.. Initial Rent.......... Greater of $5 per acre Grant execution...... Pay.gov.............. Sec. 585.508.
per year or $450 per
year, unless
otherwise established
in the grant.
[[Page 42742]]
Subsequent Rent....... ...................... Annually or in 5-year 30 CFR 1218.51.......
batches.
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\1\ There is no acquisition fee for ROW grants or RUE grants.
Sec. 585.501 What deposits must I submit for a competitively issued
lease, ROW grant, or RUE grant?
(a) For a competitively issued lease or grant, BOEM may require a
bid deposit before the auction as established in the FSN.
(b) The provisional winner of a lease must pay the balance of its
accepted bid in accordance with Sec. 585.225.
Sec. 585.502 What initial payment requirements must I meet to obtain
a noncompetitive lease, ROW grant, or RUE grant?
When requesting a noncompetitive lease, you must meet the initial
payment (acquisition fee) requirements of this section, unless
specified otherwise in your lease instrument. No initial payment is
required when requesting noncompetitive ROW grants and RUE grants.
(a) If you request a noncompetitive lease, you must submit an
acquisition fee of $0.25 per acre, unless otherwise set by the
Director, as provided in Sec. 585.500.
(b) If BOEM determines there is no competitive interest, we will
then:
(1) Retain your acquisition fee if we issue you a lease; or
(2) Refund your acquisition fee, without interest, if we do not
issue your requested lease.
(c) If we determine that there is a competitive interest in an area
you requested, then we will proceed with a competitive lease sale
process provided for in subpart C of this part, and we will:
(1) Apply your acquisition fee to the required deposit for your bid
amount if you submit a bid;
(2) Apply your acquisition fee to your bonus bid if you acquire the
lease; or
(3) Retain your acquisition fee if you do not bid for or acquire
the lease.
Sec. 585.503 What are the rent and operating fee requirements for a
commercial lease?
(a) The rent for a commercial lease is $3 per acre per year, unless
otherwise established in the FSN or lease.
(1) You must pay ONRR the first 12 months' rent no later than 45
calendar days after you receive your copy of the executed lease from
BOEM under Sec. 585.500(c)(3).
(2) You must pay ONRR as provided in 30 CFR 1218.51 the rent due at
the beginning of each subsequent 1-year period for the entire lease
area until the facility begins commercial operations as specified in
Sec. 585.506 or as otherwise specified in the FSN or lease:
(i) For leases issued competitively, BOEM will specify in the FSN
and lease any adjustment to the rent that will take effect during
commercial operations but before the operations period.
(ii) For leases issued noncompetitively, BOEM will specify in the
lease any adjustment to the rent that will take effect during
commercial operations but before the operations period.
(3) You must pay ONRR as provided in 30 CFR 1218.51 the rent due
for a project easement in addition to the lease rent as provided in
Sec. 585.507. You must commence rent payments for your project
easement upon BOEM's approval of your COP or GAP.
(b) After your lease begins commercial operations, you must pay the
operating fees in the amount specified in Sec. 585.506. Regardless of
whether the lease is awarded competitively or noncompetitively, BOEM
will specify in the lease when operating fees commence.
Sec. 585.504 How are my payments affected if I develop my commercial
lease in phases?
If you develop your commercial lease in phases as approved by BOEM
in your COP under Sec. 585.238, you must pay ONRR as provided in 30
CFR 1218.51:
(a) Rent on the portion of the lease that has not commenced
commercial operations.
(b) Operating fees on the portion of the lease that has commenced
commercial operations, in the amount specified in Sec. 585.506 and as
described in Sec. 585.503(b).
(c) Rent for a project easement in addition to lease rent, as
provided in Sec. 585.507. You must commence rent payments for your
project easement upon our approval of your COP.
Sec. 585.505 What are the rent and operating fee requirements for a
limited lease?
(a) The rent for a limited lease is $3 per acre per year, unless
otherwise established in the Final Sale Notice and/or your lease
instrument.
(b) You must pay ONRR the initial 12 months' rent 45 days after you
receive the lease copies from BOEM in accordance with the requirements
provided in Sec. 585.500(c)(3).
(c) You must pay ONRR as provided in 30 CFR 1218.51 the rent due at
the beginning of each subsequent 1-year period on the entire lease area
for the duration of your operations period.
(d) BOEM will not charge an operating fee for the authorized sale
of power from a limited lease.
Sec. 585.506 What operating fees must I pay on a commercial lease?
Once you commence commercial operations, you must pay ONRR as
provided in 30 CFR 1218.51 operating fees on your commercial lease as
described in Sec. 585.503.
(a) BOEM will determine the annual operating fee for activities
relating to the generation of electricity on your lease based on the
formula F = M * H * c * P * r, where:
(1) F is the dollar amount of the annual operating fee;
(2) M is the nameplate capacity expressed in megawatts;
(3) H is the number of hours in a year, equal to 8,760, used to
calculate an annual payment;
(4) c is the ``capacity factor'' representing the anticipated
efficiency of the facility's operation expressed as a decimal between
zero and one;
(5) P is a measure of the annual average wholesale electric power
price expressed in dollars per megawatt hour, as provided in paragraph
(c)(2) of this section; and
(6) r is the operating fee rate expressed as a decimal between zero
and one.
(b) The annual operating fee formula relating to the value of
annual electricity generation is restated as:
Equation 1 to Paragraph (b)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
M (nameplate c (capacity r (operating fee
F (annual operating fee) = capacity) * H (hours per year) * factor) * P (power price) * rate)
------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 42743]]
(c) BOEM will specify operating fee parameters in the Final Sale
Notice for commercial leases issued competitively and in the lease for
those issued noncompetitively.
(1) Unless BOEM specifies otherwise, the operating fee rate ``r''
is 0.02 for each year the operating fee applies when you begin
commercial operations. We may apply a different fee rate for new
projects (i.e., a new generation based on new technology) after
considering factors such as program objectives, state of the industry,
project type, and project potential. Also, we may agree to reduce or
waive the fee rate under Sec. 585.510.
(2) The power price ``P,'' for each year when the operating fee
applies, will be determined annually. The process by which the power
price will be determined will be specified in the Final Sale Notice
and/or in the lease. BOEM:
(i) Will use the most recent annual average wholesale power price
in the State in which a project's transmission cables make landfall, as
published by the Department of Energy (DOE), Energy Information
Administration (EIA), or other publicly available wholesale power price
indices; and
(ii) May adjust the published average wholesale power price to
reflect documented variations by State or within a region and recent
market conditions.
(3) BOEM will select the capacity factor ``c'' based upon
applicable analogs drawn from present and future domestic and foreign
projects that operate in comparable conditions and on comparable
scales.
(i) Upon the completion of the first year of the operations period
on a lease, BOEM may adjust the capacity factor as necessary (to
accurately represent a comparison of actual production over a given
period of time with the amount of power a facility would have produced
if it had run at full capacity) in a subsequent year.
(ii) After the first adjustment, BOEM may adjust the capacity
factor (to accurately represent a comparison of actual generation over
a given period of time with the amount of power a facility would have
generated if it had run at full capacity) no earlier than in 5-year
intervals from the most recent year that BOEM adjusts the capacity
factor.
(iii) The process by which BOEM will adjust the capacity factor,
including any calculations (incorporating an average capacity factor
reflecting actual operating experience), will be specified in the
lease. The operator or lessee may request review and adjustment of the
capacity factor under Sec. 585.510.
(4) For the nameplate capacity ``M,'' BOEM will use the total
installed capacity of the equipment you install, as specified in your
approved COP.
(d) You must submit all operating fee payments to ONRR in
accordance with the provisions under 30 CFR 1218.51.
(e) BOEM will establish the operating fee in the Final Sale Notice
or in the lease on a case-by-case basis for:
(1) Activities that do not relate to the generation of electricity
(e.g., hydrogen production); and
(2) Leases issued for hydrokinetic activities requiring a FERC
license.
Sec. 585.507 What rent payments must I pay on a project easement?
(a) You must pay rent to ONRR as provided in 30 CFR 1218.51 for
your project easement in the amount of $5 per acre, subject to a
minimum of $450 per year, unless specified otherwise in the lease.
(1) The size of the project easement will be determined according
to Sec. 85.628(g)(1).
(2) The size of a project easement area for an accessory platform
is limited to the areal extent of anchor chains and other facilities
and devices associated with the accessory.
(b) You must commence rent payments for your project easement upon
our approval of your COP or GAP:
(1) You must make the first rent payment as provided in Sec.
585.500;
(2) You must submit all subsequent rent payments in accordance with
the regulations at 30 CFR 1218.51; and
(3) You must continue to pay annual rent for your project easement
until your lease is terminated.
Sec. 585.508 What rent payments must I pay on ROW grants or RUE
grants associated with renewable energy projects?
(a) For each ROW grant BOEM approves under subpart D of this part,
you must pay annual rent of $5 per acre to ONRR as provided in 30 CFR
1218.51 and as determined by Sec. 585.301(a), but in no case less than
$450, for use of the grant, unless specified otherwise in the grant.
(b) For each RUE grant BOEM approves under subpart D of this part,
you must pay rent to ONRR as provided in 30 CFR 1218.51 in the amount
of:
(1) $5 per acre per year; or
(2) A minimum of $450 per year.
(c) You must make the rent payments required by paragraphs (a) and
(b) of this section on:
(1) An annual basis;
(2) For a 5-year period; or
(3) For multiples of 5 years.
(d) You must make the first annual rent payment upon approval of
your ROW grant or RUE grant request, as provided in Sec. 585.500, and
all subsequent rent payments to ONRR in accordance with the regulations
at 30 CFR 1218.51.
Sec. 585.509 Who is responsible for submitting lease or grant
payments to ONRR?
(a) For each lease, ROW grant, or RUE grant issued under this part,
you must identify one person who is responsible for all payments due
and payable under the provisions of the lease or grant. The responsible
person identified is designated as the payor, and you must document
acceptance of such responsibilities, as provided in 30 CFR 1218.52.
(b) All payors must submit payments and maintain auditable records
in accordance with guidance we issue or any applicable regulations in
subchapter A of this chapter. In addition, the lessee or grant holder
must also maintain such auditable records.
Sec. 585.510 May BOEM defer, reduce, or waive my lease or grant
payments?
(a) The BOEM Director may defer, reduce, or waive the rent or
operating fee or components of the operating fee, such as the fee rate
or capacity factor, when the Director determines that continued
activities would be uneconomic without the requested deferral,
reduction, or waiver, or that it is necessary to encourage continued or
additional activities.
(b) When requesting a deferral, reduction, or waiver, you must
submit an application to BOEM that includes all of the following:
(1) The number of the lease, ROW grant, or RUE grant involved;
(2) Name of each lessee or grant holder of record;
(3) Name of each operator;
(4) A demonstration that:
(i) Continued activities would be uneconomic without the requested
deferral, reduction, or waiver; or
(ii) A deferral, reduction, or waiver is necessary to encourage
additional activities; and
(5) Any other information required by the Director.
(c) No more than 6 years of your operations period will be subject
to a full waiver of the operating fee.
[[Page 42744]]
Sec. Sec. 585.511-585.515 [Reserved]
Financial Assurance Requirements for Commercial Leases
Sec. 585.516 What are the financial assurance requirements for each
stage of my commercial lease?
(a) The financial assurance requirements for each stage of your
commercial lease are:
------------------------------------------------------------------------
Before BOEM will . . . You must provide . . .
------------------------------------------------------------------------
(1) Execute a commercial A bond or other authorized financial
lease or approve an assurance in the amount of 12 months'
assignment of an existing rent.
commercial lease..
(2) Allow you to install A supplemental bond or other authorized
facilities approved in your financial assurance in an amount
SAP. determined by BOEM based on the
anticipated decommissioning costs of the
proposed facilities.
(3) Allow you to install A supplemental bond or other authorized
facilities approved in your financial assurance in an amount
COP. determined by BOEM based on anticipated
decommissioning costs of the proposed
facilities. If you propose to
incrementally fund your financial
assurance instrument, BOEM must approve
the schedule for providing the
appropriate financial assurance.
------------------------------------------------------------------------
(b) Each bond or other authorized financial assurance must
guarantee compliance with this part, the applicable plan approvals, and
the terms and conditions of the lease.
(c) For hydrokinetic commercial leases, supplemental financial
assurance may be required in an amount determined by BOEM prior to
installation of facilities pursuant to a FERC license.
Sec. 585.517 How will BOEM determine the supplemental financial
assurance associated with commercial leases?
(a) BOEM determines the amount of your supplemental financial
assurance based on the estimated costs to meet all accrued lease
obligations, including:
(1) The projected amount of annual rent and other payments due to
the United States over the next 12 months, to the extent that amount is
not covered in the initial financial assurance provided in Sec.
585.516(a)(1);
(2) Any past due rent and other payments;
(3) Other monetary obligations; and
(4) The estimated cost of facility decommissioning, as required by
30 CFR part 285, subpart I.
(b) If your cumulative potential obligations and liabilities
increase or decrease, we may adjust the amount of the supplemental
financial assurance.
(1) If we propose adjusting your financial assurance amount, we
will notify you of the proposed adjustment and give you an opportunity
to comment; and
(2) We may approve a reduced financial assurance amount if you
request it and if the reduced amount that you request is sufficient to
cover your obligations and liabilities calculated under paragraph (a)
of this section.
Sec. Sec. 585.518-585.519 [Reserved]
Financial Assurance for Limited Leases, ROW Grants, and RUE Grants
Sec. 585.520 What financial assurance must I provide when I obtain my
limited lease, ROW grant, or RUE grant?
Before BOEM will execute your limited lease, ROW grant, or RUE
grant, or approve an assignment of an interest therein, you or a
proposed assignee must guarantee compliance with all terms and
conditions of the lease or grant by providing a bond or other
authorized financial assurance in the amount of 12 months' rent.
Sec. 585.521 Do my financial assurance requirements change as
activities progress on my limited lease or grant?
(a) BOEM may require you to increase or allow you to decrease the
amount of your financial assurance as activities progress on your
limited lease or grant based on the estimated costs to meet all accrued
lease or grant obligations.
(b) The total amount of the financial assurance must be no less
than the amount required to meet your limited lease and grant
obligations, including:
(1) The projected amount of rent and other payments due to the
United States over the next 12 months;
(2) Any past due rent and other payments;
(3) Other monetary obligations; and
(4) The estimated cost of facility decommissioning as required by
30 CFR part 285, subpart I.
(c) If BOEM proposes adjusting the amount of your financial
assurance to ensure your limited lease and grant obligations are met,
BOEM will notify you of the proposed adjustment and will provide you an
opportunity to object.
(d) You may submit a written request to BOEM to reduce the amount
of your financial assurance if your proposed amount is not less than
the sum of your obligations listed in paragraph (b) of this section.
BOEM may approve your request in its discretion.
(e) You may satisfy the requirement for increased financial
assurance on your limited lease or grant by increasing the amount of
your existing bond or by providing a supplemental bond or other
financial assurance.
(1) The supplemental bond or other financial assurance must meet
the requirements specified in Sec. Sec. 585.525 through 585.529.
(2) If you propose to incrementally fund your financial assurance,
BOEM must approve the schedule for providing the appropriate financial
assurance.
Sec. Sec. 585.522-585.524 [Reserved]
Requirements for Financial Assurance Instruments
Sec. 585.525 What general requirements must a financial assurance
instrument meet?
(a) Any bond or other acceptable financial assurance instrument
that you provide must:
(1) Be payable to BOEM upon demand; and
(2) Guarantee compliance of all lessees, grant holders, operators,
and payors with all terms and conditions of the lease or grant, any
subsequent approvals and authorizations, and all applicable
regulations.
(b) All bonds and other forms of financial assurance must be on or
in a form approved by BOEM. You may submit this on an approved form
that you have reproduced or generated by use of a computer. If the
document you submit omits any terms and conditions that are included on
the BOEM-approved form, your bond is deemed to
[[Page 42745]]
contain the omitted terms and conditions.
(c) Surety bonds must be issued by an approved surety listed in the
current Treasury Circular 570, as required by 31 CFR 223.16. You may
obtain a copy of Circular 570 from the Treasury website at https://www.fiscal.treasury.gov/surety-bonds/circular-570.html.
(d) Your surety bond cannot exceed the underwriting limit listed in
the current Treasury Circular 570, except as permitted therein.
(e) You and a qualified surety must execute your bond. When the
surety is a corporation, an authorized corporate officer must sign the
bond and attest to it over the corporate seal.
(f) You may not terminate the period of liability of your bond or
cancel your bond, except as provided in this subpart. Bonds must
continue in full force and effect even though an event has occurred
that could diminish or terminate a surety's obligation under State law.
(g) Your surety must notify you and BOEM within 5 business days
after:
(1) It initiates any judicial or administrative proceeding alleging
its insolvency or bankruptcy; or
(2) The Treasury decertifies the surety.
Sec. 585.526 What instruments other than a surety bond may I use to
meet the financial assurance requirement?
(a) You may use other types of security instruments, if BOEM
determines that such security protects BOEM to the same extent as the
surety bond. BOEM will consider pledges of the following:
(1) U.S. Department of Treasury securities identified in 31 CFR
part 225;
(2) A pledge of cash, in an amount equal to the required dollar
amount of the financial assurance, to be deposited and maintained in a
Federal depository account of the U.S. Treasury;
(3) Certificates of deposit or savings accounts in a bank or
financial institution organized or authorized to transact business in
the United States with:
(i) Minimum net assets of $500,000,000; and
(ii) Minimum Bankrate.com Safe & Sound rating of 3 Stars, and
Capitalization, Assets, Equity and Liquidity (CAEL) rating of 3 or
less;
(4) Negotiable U.S. Government, State, and municipal securities or
bonds having a market value of not less than the required dollar amount
of the financial assurance and maintained in a Securities Investors
Protection Corporation insured trust account by a licensed securities
brokerage firm for the benefit of BOEM;
(5) Investment-grade rated securities having a Standard and Poor's
rating of AAA or an equivalent rating from a nationally recognized
securities rating service having a market value of not less than the
required dollar amount of the financial assurance and maintained in a
Securities Investors Protection Corporation insured trust account by a
licensed securities brokerage firm for the benefit of BOEM;
(6) Insurance, if its form and function is such that the funding or
enforceable pledges of funding are used to guarantee performance of
regulatory obligations in the event of default on such obligations by
the lessee. Insurance must have an A.M. Best rating of ``superior'' or
an equivalent rating from a nationally recognized insurance rating
service;
(7) Letters of credit, subject to the following conditions:
(i) The letter of credit provider must have an issuer credit rating
from a Nationally Recognized Statistical Rating Organization (NRSRO)
greater than or equal to investment grade from either Standard & Poor's
Ratings Service or Moody's Investor Service, or a proxy credit rating
determined by BOEM based on audited financial information (including an
income statement, balance sheet, statement of cash flows, and the
auditor's certificate) greater than or equal to investment grade from
either Standard & Poor's Ratings Service or Moody's Investor Service;
(ii) The letter of credit must grant BOEM full authority to demand
immediate payment in case of default in the performance of the terms
and conditions of a lease or regulatory obligations;
(iii) The letter of credit must be irrevocable during its term and
will be subject to collection by BOEM if not replaced by another letter
of credit or other form of financial assurance at least 30 calendar
days before its expiration date;
(iv) The expiration date of the letter of credit must not be less
than 90 days following the date it becomes effective;
(v) The letter of credit must contain a provision for automatic
renewal for periods of not less than 1 year in the absence of notice of
cancellation to BOEM at least 90 calendar days before the expiration
date; and
(vi) The letter of credit must contain a venue provision, which
requires any disputes to be adjudicated in a U.S. Federal court that is
mutually agreed upon by BOEM and the issuers of the letter of credit;
(8) Another form of security approved by BOEM in its discretion; or
(9) A combination of security instruments described in paragraphs
(a)(1) through (8) of this section.
(b) If you use a Treasury security:
(1) You must post 115 percent of your financial assurance amount;
(2) You must monitor the collateral value of your security. If the
collateral value of your security as determined in accordance with 31
CFR part 203, Collateral Margins Table (which can be found at https://www.treasurydirect.gov), falls below the required level of coverage,
you must pledge additional security to provide 115 percent of the
required amount; and
(3) You must include with your pledge authority for us to sell the
security and use the proceeds if we determine that you have failed to
comply with any of the terms and conditions of your lease or grant, any
subsequent approval or authorization, or applicable regulations.
(c) If you use the instruments described in paragraph (a)(4) or (5)
of this section, you must provide BOEM by the end of each calendar year
a certified statement describing the nature and market value of the
instruments maintained in that account, and including any current
statements or reports furnished by the brokerage firm to the lessee
concerning the asset value of the account.
Sec. 585.527 May I demonstrate financial strength and reliability to
meet the financial assurance requirement for lease or grant activities?
BOEM may allow you to use your financial strength and reliability
to meet financial assurance requirements if:
(a) You have an investment grade issuer credit rating. If any
Securities and Exchange Commission (SEC)-recognized NRSRO provides a
credit rating that differs from any other SEC-recognized NRSRO credit
rating, BOEM will apply the highest rating for the purposes of
determining your financial assurance requirements.
(b) You have a proxy credit rating determined by BOEM, which must
be based on audited financial information for the most recent fiscal
year (which must include an income statement, balance sheet, statement
of cash flows, and the auditor's certificate).
(1) The audited financial information for your most recent fiscal
year must cover a continuous twelve-month period within the twenty-
four-month period prior to the lessee's receipt of the determination
that you must provide supplemental financial assurance.
(2) In determining your proxy credit rating, BOEM may include the
value of the offshore decommissioning liabilities
[[Page 42746]]
associated with any lease(s) or grants in which you have an ownership
interest. Upon BOEM's request, you must provide the information that
BOEM determines is necessary to properly evaluate your offshore
decommissioning liabilities, including joint ownership interests and
liabilities associated with your OCS leases and grants.
(c) Your co-lessee or co-grant-holder has an issuer credit rating
or a proxy credit rating that meets the criteria set forth in paragraph
(a) of this section; however, BOEM may require you to provide financial
assurance for decommissioning obligations for which such co-lessee or
co-grant-holder is not liable.
(d) You have a contract with a counterparty that projects net
income will exceed three times the estimated decommissioning expenses
associated with the facilities that will generate that income.
(e) If we approve your request to use your financial strength and
reliability to meet your financial assurance requirements, you must
submit annual updates.
(f) If the annual updates do not continue to demonstrate financial
strength and reliability or BOEM has reason to believe that you are
unable to meet the requirements of this section, after notice and
opportunity for a hearing, BOEM will terminate your ability to use
financial strength and reliability for financial assurance and require
you to provide another type of financial assurance. You must provide
this new financial assurance instrument within 90 days after we
terminate your use of financial strength and reliability.
Sec. 585.528 May I use a third-party guaranty to meet the financial
assurance requirement for lease or grant activities?
(a) You may use a third-party guaranty to secure all or part of the
obligations for which financial assurance was demanded by BOEM if the
guarantor:
(1) Meets the credit rating or proxy credit rating criterion set
forth in Sec. [thinsp]585.527(a); and
(2) Submits an agreement containing each of the provisions in
paragraph (d) of this section.
(b) A third-party guarantor may limit its cumulative obligations to
a fixed dollar amount as agreed to by BOEM at the time the third-party
guaranty is provided.
(c) If, during the life of your third-party guaranty, your
guarantor no longer meets the criterion referred to in paragraph (a)(1)
of this section, you must:
(1) Notify BOEM within 72 hours of so learning; and
(2) Submit a surety bond or other financial assurance covering the
obligations previously secured by the third-party guaranty.
(d) Your guarantor must submit an agreement executed by the
guarantor and all parties bound by the agreement. All parties are bound
jointly and severally, and the guarantor must meet the legal and
financial qualifications set forth in Sec. Sec. 585.107 and 585.108.
(1) When any party is a corporation, two corporate officers
authorized to execute the guaranty agreement on behalf of the
corporation must sign the agreement.
(2) When any party is a partnership, joint venture, or syndicate,
the guaranty agreement must bind each party who has a beneficial
interest in your guarantor and provide that, upon BOEM demand under
your guaranty, each party is jointly and severally liable for
compliance with all terms and conditions of your lease(s) or grant(s)
covered by the agreement.
(3) When forfeiture of the guaranty is called for, the agreement
must provide that your guarantor will either bring your lease(s) or
grant(s) into compliance or provide, within 7 days, sufficient funds to
permit BOEM to complete corrective action.
(4) The guaranty agreement must contain a confession of judgment,
providing that, if BOEM determines that you or your operator is in
default, the guarantor must not challenge the determination and must
remedy the default.
(5) If your guarantor wants to terminate the period of liability,
your guarantor must notify you and BOEM at least 90 days before the
proposed termination date, obtain BOEM's approval for termination of
all or a specified portion of the guarantee for liabilities arising
after that date, and remain liable for all your work performed during
the period the agreement is in effect.
(6) Each guaranty submitted pursuant to this section is deemed to
contain all the terms described in in paragraphs (d)(1) through (5) of
this section, even if they are not actually in the agreement.
(e) Before the termination of your guaranty, you must provide an
acceptable replacement in the form of a bond or other security.
Sec. 585.529 Can I use a lease- or grant-specific decommissioning
account to meet the financial assurance requirements related to
decommissioning?
(a) In lieu of a surety bond, BOEM may authorize you to establish a
lease-, ROW grant-, or RUE grant-specific decommissioning account in a
federally insured institution. The funds may not be withdrawn from the
account without our written approval.
(1) The funds must be payable to BOEM and pledged to meet your
lease or grant decommissioning and site clearance obligations;
(2) You must fund the account in the amount determined by and
according to the payment schedule approved by BOEM. BOEM will estimate
the cost of decommissioning, including site clearance; and
(3) Subject to BOEM's approval, a decommissioning account may be
funded in whole or in part during the operations period of a lease or
grant.
(b) Any interest paid on the account will be treated as account
funds unless we authorize in writing that any interest be paid to the
depositor.
(c) We may allow you to pledge Treasury securities, payable to BOEM
on demand, to satisfy your obligation to make payments into the
account. Acceptable Treasury securities and their collateral value are
determined in accordance with 31 CFR part 203, Collateral Margins Table
(which can be found at https://www.treasurydirect.gov).
(d) We may require you to commit a specified stream of revenues as
payment into the account so that the account will be fully funded, as
prescribed in paragraph (a)(2) of this section. The commitment may
include revenue from other operations.
Changes in Financial Assurance
Sec. 585.530 What must I do if my financial assurance lapses?
(a) If your surety is decertified by the Treasury, becomes bankrupt
or insolvent, or if your surety's charter or license is suspended or
revoked, or if any other approved financial assurance expires for any
reason, you must:
(1) Inform BOEM within 3 business days about the financial
assurance lapse; and
(2) Provide new financial assurance in the amount set by BOEM, as
provided in this subpart.
(b) You must notify BOEM within 3 business days after you learn of
any action filed alleging that you, your surety, or your third-party
guarantor is insolvent or bankrupt.
Sec. 585.531 What happens if the value of my financial assurance is
reduced?
If the value of your financial assurance is reduced below the
required financial assurance amount because of a default or any other
reason, you must provide additional financial assurance
[[Page 42747]]
sufficient to meet the requirements of this subpart within 45 days or
within a different period as specified by BOEM.
Sec. 585.532 What happens if my surety wants to terminate the period
of liability of my financial assurance?
(a) Terminating the period of liability of your financial assurance
ends the period during which surety liability continues to accrue. The
surety continues to be responsible for obligations and liabilities that
accrued during the period of liability and before the date on which
BOEM terminates the period of liability under paragraph (b) of this
section. The liabilities that accrue during a period of liability
include:
(1) Obligations that started to accrue before the beginning of the
period of liability and have not been met; and
(2) Obligations that began accruing during the period of liability.
(b) Your surety must submit to BOEM its request to terminate the
period of liability under its financial assurance and notify you of
that request no less than 90 days before the proposed termination date.
If you intend to continue activities on your lease or grant, you must
provide replacement financial assurance of equivalent or greater value.
BOEM will terminate that period of liability within 90 days after BOEM
receives the request.
Sec. 585.533 How does my surety obtain cancellation of my financial
assurance?
BOEM will allow a surety to cancel financial assurance and will
relieve the surety from liability for accrued obligations on the
earliest to occur of the following:
(a) BOEM determines that there are no outstanding obligations
covered by the financial assurance;
(b) The following occurs:
(1) BOEM accepts replacement financial assurance in an amount equal
to or greater than the financial assurance to be cancelled to cover the
period of liability prior to termination; or
(2) The surety issuing the new financial assurance has expressly
agreed to assume all outstanding liabilities under the original
financial assurance that accrued during the period of liability that
was terminated; and
(c) Seven years have elapsed since the termination of the period of
liability if the new surety did not assume the accrued obligations for
the terminated period of liability, unless there are any appeals or
judicial litigation related to your liabilities covered by the
financial assurance.
Sec. 585.534 When may BOEM cancel my financial assurance?
(a) When your lease or grant ends, your sureties remain
responsible, and BOEM will cancel your financial assurance as shown in
the following table:
----------------------------------------------------------------------------------------------------------------
Financial assurance Your financial assurance will not be cancelled until . . .
----------------------------------------------------------------------------------------------------------------
(1) Financial assurance for Seven years after all operations and activities under the lease or grant
commercial leases submitted under cease, including decommissioning and site clearance, or a longer period
Sec. 585.516(a)(1) and for grants as necessary to complete any appeals or judicial litigation related to
or limited leases submitted under your financial assurance obligation. BOEM may reduce or cancel your
Sec. Sec. 585.520 and 585.521. financial assurance or return some or all of your security if BOEM
determines that the full amount is no longer needed.
(2) Supplemental financial assurance (i) The lease or grant expires or is terminated and BOEM determines you
for commercial leases submitted have met your secured obligations, unless BOEM:
under Sec. 585.516 and for grants (A) Determines that the future potential liability resulting from any
or limited leases submitted under undetected problem is greater than the amount of your lease-specific
Sec. Sec. 585.520 and 585.521. financial assurance; and
(B) Notifies the provider of the supplemental financial assurance that
BOEM will wait 7 years before cancelling all or a part of the
supplemental financial assurance (or longer period as necessary to
complete any appeals or judicial litigation related to your secured
obligations); or
(ii) At any time when:
(A) BOEM determines, in its discretion, that you no longer need to provide
the supplemental financial assurance;
(B) The operations for which the supplemental financial assurance was
provided were cancelled before accrual of any decommissioning obligation;
or
(C) Cancellation of the supplemental financial assurance is appropriate
because, under the regulations in this part, BOEM determines such
financial assurance never should have been required.
----------------------------------------------------------------------------------------------------------------
(b) BOEM may require reinstatement of your financial assurance as
if no cancellation had occurred if:
(1) A person makes a payment under the lease or grant, and the
payment is rescinded or must be repaid by the recipient because the
person making the payment is insolvent, bankrupt, subject to
reorganization, or placed in receivership; or
(2) The responsible party represents to BOEM that it has discharged
its obligations under the lease or grant, and the representation was
materially false when the financial assurance was cancelled.
Sec. 585.535 Why might BOEM call for forfeiture of my financial
assurance?
(a) BOEM may call for forfeiture of all or part of your financial
assurance if:
(1) After notice and demand for performance by BOEM, you refuse or
fail, within the timeframe we prescribe, to comply with any term or
condition of your lease or grant, other authorization or approval, or
applicable regulations; or
(2) You default on one of the conditions under which we accepted
your financial assurance.
(b) We may pursue forfeiture without first making demands for
performance against any co-lessee or holder of an interest in your ROW
or RUE, or other person approved to perform obligations under your
lease or grant.
Sec. 585.536 How will I be notified of a call for forfeiture?
(a) BOEM will notify you and your surety, including any provider of
financial assurance, in writing of the call for forfeiture and provide
the reasons for the forfeiture and the amount to be forfeited. We will
base the amount upon an estimate of the total cost of corrective action
to bring your lease or grant into compliance.
(b) We will advise you and your surety that you may avoid
forfeiture if, within 10 business days:
(1) You agree to and demonstrate in writing to BOEM that you will
bring your lease or grant into compliance within the timeframe we
prescribe, and you do so; or
[[Page 42748]]
(2) Your surety agrees to and demonstrates that it will bring your
lease or grant into compliance within the timeframe we prescribe, even
if the cost of compliance exceeds the face amount of the bond.
Sec. 585.537 How will BOEM proceed once my bond or other security is
forfeited?
(a) If BOEM determines that your bond or other security is
forfeited, we will collect the forfeited amount and use the funds to
bring your lease or grant(s) into compliance and correct any default.
(b) If the amount collected under your bond or other security is
insufficient to pay the full cost of corrective action, BOEM may take
or direct action to obtain full compliance and recover all costs in
excess of the forfeited bond from you or any co-lessee or co-grantee.
(c) If the amount collected under your bond or other security
exceeds the full cost of corrective action to bring your lease or
grant(s) into compliance, we will return the excess funds to the party
from whom the excess was collected.
Sec. Sec. 585.538-585.539 [Reserved]
Revenue Sharing With States
Sec. 585.540 How will BOEM equitably distribute revenues to States?
(a) BOEM will distribute among the eligible coastal States 27
percent of the following revenues derived from qualified projects,
where a qualified project and qualified project area is determined in
Sec. 585.541 and an eligible State is determined in Sec. 585.542,
where a qualified project and qualified project area are determined in
585.541 and an eligible State is defined in Sec. 585.113. Revenues
subject to distribution to eligible States include all bonuses,
acquisition fees, rentals, and operating fees derived from the entire
qualified project area and associated project easements and are not
limited to revenues attributable to the portion of the project area
within 3 miles of the seaward boundary of a coastal State. The revenues
to be shared do not include administrative fees such as service fees
and those assessed for civil penalties and forfeiture of bond or other
surety obligations.
(b) The project area is the area included within a single lease or
grant. For each qualified project, BOEM will determine and announce the
project area and its geographic center at the time it grants or issues
a lease, easement, or right-of-way on the OCS. If a qualified project
lease or grant's boundaries change significantly due to actions
pursuant to Sec. 585.435 or Sec. 585.436, BOEM will re-evaluate the
project area to determine whether the geographic center has changed. If
it has, BOEM will re-determine State eligibility and shares
accordingly.
(c) To determine each eligible State's share of the 27 percent of
the revenues for a qualified project, BOEM will use the inverse
distance formula, which apportions shares according to the relative
proximity of the nearest point on the coastline of each eligible State
to the geographic center of the qualified project area. If
Si is equal to the nearest distance from the geographic
center of the project area to the i = 1, 2, * * * nth eligible State's
coastline, then eligible State i would be entitled to the fraction
Fi of the 27-percent aggregate revenue share due to all the
eligible States according to the following formula:
Formula 1 to paragraph (c)
Fi = (1/Si) / ([Sigma]i=1* *
*n(1/Si))
Sec. 585.541 What is a qualified project for revenue sharing
purposes?
A qualified project for the purpose of revenue sharing with
eligible coastal States is one authorized under subsection 8(p) of the
OCS Lands Act, which includes acreage within the area extending 3 miles
seaward of State submerged lands. A qualified project is subject to
revenue sharing with those States that are eligible for revenue sharing
under Sec. 585.542. The entire area within a lease or grant for the
qualified project, excluding project easements, is considered the
qualified project area.
Sec. 585.542 What makes a State eligible for payment of revenues?
A State is eligible for payment of revenues if any part of the
State's coastline is located within 15 miles of the announced
geographic center of the project area of a qualified project. A State
is not eligible for revenue sharing if all parts of that State's
coastline are more than 15 miles from the announced geographic center
of the qualified project area. This is the case even if the qualified
project area is located wholly or partially within an area extending 3
miles seaward of the submerged lands of that State or if there are no
States with a coastline less than 15 miles from the announced
geographic center of the qualified project area.
Sec. 585.543 Example of how the inverse distance formula works.
(a) Assume that the geographic center of the project area lies 12
miles from the closest coastline point of State A and 4 miles from the
closest coastline point of State B. BOEM will round dollar shares to
the nearest whole dollar. The proportional share due each State would
be calculated as follows:
(1) State A's share = [(1/12) / (1/12 + 1/4)] = 1/4.
(2) State B's share = [(1/4) / (1/12 + 1/4)] = 3/4.
(b) Therefore, State B would receive a share of revenues that is
three times as large as that awarded to State A, based on the finding
that State B's nearest coastline is one-third the distance to the
geographic center of the qualified project area as compared to State
A's nearest coastline. Eligible States share the 27 percent of the
total revenues from the qualified project as mandated under the OCS
Lands Act. Hence, if the qualified project generates $1,000,000 of
Federal revenues in a given year, the Federal Government would
distribute the States' 27-percent share as follows:
(1) State A's share = $270,000 x 1/4 = $67,500.
(2) State B's share = $270,000 x 3/4 = $202,500.
Sec. Sec. 585.544-585.599 [Reserved]
0
51. Revise subpart G to read as follows:
Subpart G--Plans and Information Requirements
Sec.
585.600 What plans must I submit to BOEM before I conduct activities
on my lease or grant?
585.601 When must I submit my plans to BOEM?
585.602-585.604 [Reserved]
Site Assessment Plan and Information Requirements for Commercial Leases
585.605 What is a Site Assessment Plan (SAP)?
585.606 What must I demonstrate in my SAP?
585.607 How do I submit my SAP?
585.608-585.609 [Reserved]
Contents of the Site Assessment Plan
585.610 What must I include in my SAP?
585.611 What information and certifications must I submit with my
SAP to assist BOEM in complying with NEPA and other applicable laws?
585.612 How will my SAP be processed for Federal consistency under
the Coastal Zone Management Act?
585.613 How will BOEM process my SAP?
Activities Under an Approved SAP
585.614 When may I begin conducting activities under my approved
SAP?
585.615 What other reports or notices must I submit to BOEM under my
approved SAP?
585.616 [Reserved]
585.617 What activities require a revision to my SAP, and when will
BOEM approve the revision?
585.618 What must I do upon completion of approved site assessment
activities?
585.619 [Reserved]
Construction and Operations Plan for Commercial Leases
585.620 What is a Construction and Operations Plan (COP)?
[[Page 42749]]
585.621 What must I demonstrate in my COP?
585.622 How do I submit my COP?
585.623-585.625 [Reserved]
Contents of the Construction and Operations Plan
585.626 What must I include in my COP?
585.627 What information and certifications must I submit with my
COP to assist BOEM in complying with NEPA and other applicable laws?
585.628 How will BOEM process my COP?
585.629-585.630 [Reserved]
Activities Under an Approved COP
585.631 When must I initiate activities under an approved COP?
585.632 What documents must I submit before I may construct and
install facilities under my approved COP?
585.633 [Reserved]
585.634 What activities require a revision to my COP, and when will
BOEM approve the revision?
585.635 What must I do if I cease activities approved in my COP
before the end of my commercial lease?
585.636-585.639 [Reserved]
General Activities Plan Requirements for Limited Leases, ROW Grants,
and RUE Grants
585.640 What is a General Activities Plan (GAP)?
585.641 What must I demonstrate in my GAP?
585.642 How do I submit my GAP?
585.643-585.644 [Reserved]
Contents of the General Activities Plan
585.645 What must I include in my GAP?
585.646 What information and certifications must I submit with my
GAP to assist BOEM in complying with NEPA and other applicable laws?
585.647 How will my GAP be processed for Federal consistency under
the Coastal Zone Management Act?
585.648 How will BOEM process my GAP?
585.649 [Reserved]
Activities Under an Approved GAP
585.650 When may I begin conducting activities under my GAP?
585.651 When may I construct complex or significant OCS facilities
on my limited lease or any facilities on my project easement
proposed under my GAP?
585.652 How long do I have to conduct activities under an approved
GAP?
585.653 What other reports or notices must I submit to BOEM under my
approved GAP?
585.654 [Reserved]
585.655 What activities require a revision to my GAP, and when will
BOEM approve the revision?
585.656 What must I do if I cease activities approved in my GAP
before the end of my term?
585.657 What must I do upon completion of approved activities under
my GAP?
Cable and Pipeline Deviations
585.658 Can my cable or pipeline construction deviate from my
approved COP or GAP?
585.659-585.699 [Reserved]
Environmental Protection Requirements Under Approved Plans
585.700 What requirements must I include in my SAP, COP, or GAP
regarding air quality?
585.701 How must I conduct my approved activities to protect marine
mammals, threatened and endangered species, and designated critical
habitat?
585.702 What must I do if I discover a potential archaeological
resource while conducting my approved activities?
585.703 How must I conduct my approved activities to protect
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?
Subpart G--Plans and Information Requirements
Sec. 585.600 What plans must I submit to BOEM before I conduct
activities on my lease or grant?
(a) You must submit a SAP, COP, or GAP and receive BOEM approval
before you conduct activities on your lease or grant as set forth in
the following table:
------------------------------------------------------------------------
You must submit and obtain
Before you: approval for your:
------------------------------------------------------------------------
(1) Conduct site assessment activities on SAP under Sec. Sec.
your commercial lease, such as 585.605 through 585.613.
meteorological towers or other facilities
that are installed on the seabed using a
fixed-bottom foundation requiring
professional engineering design and
assessment of sediment, meteorological,
and oceanographic conditions as part of
the design.
(2) Conduct any activities pertaining to COP under Sec. Sec.
construction of facilities for commercial 585.620 through 585.628.
operations on your commercial lease.
(3) Conduct any activities on your limited GAP under Sec. Sec.
lease or grant in any OCS area. 585.640 through 585.648.
------------------------------------------------------------------------
(b) BOEM may waive certain types of information or analyses that
you otherwise must provide in your proposed plan when you demonstrate
that:
(1) Sufficient applicable information or analysis is readily
available to BOEM;
(2) The coastal or marine resources that are the subject of the
information requirement are not present or affected;
(3) Other factors affect your ability to obtain or BOEM's need for
the required information; or
(4) Information is neither necessary nor required for a State to
determine consistency with its coastal management program.
Sec. 585.601 When must I submit my plans to BOEM?
(a) You may submit your SAP anytime; however, your SAP must be
submitted to and approved by BOEM before you conduct activities
requiring a SAP under Sec. 585.600(a)(1).
(b) You must submit your COP by the end of the preliminary period
of your commercial lease in accordance with Sec. 585.235.
(1) Your COP must contain sufficient data and information for BOEM
to complete its reviews and NEPA analysis.
(2) BOEM may need to conduct additional reviews of your COP,
including environmental analysis under NEPA, if significant new
information becomes available from your site assessment and
characterization activities or if you substantially revise your COP. As
a result of the additional reviews, BOEM may require that you revise
your COP.
(c) You must submit your GAP by the end of the preliminary period
for your limited lease in accordance with Sec. 585.236, or the
preliminary period for your grant in accordance with Sec. 585.303.
Sec. Sec. 585.602-585.604 [Reserved]
Site Assessment Plan and Information Requirements for Commercial Leases
Sec. 585.605 What is a Site Assessment Plan (SAP)?
(a) A SAP describes the site assessment activities meeting the
criteria in Sec. 585.600(a)(1) that you plan to perform on your
commercial lease.
(b) You must receive BOEM approval of your SAP, as provided in
Sec. 585.613, before you can begin any proposed site assessment
activities requiring such approval.
(c) If BOEM determines that your proposed site assessment facility
or combination of facilities is complex or significant under Sec.
585.613(a)(1), you must comply with the requirements in 30 CFR part
285, subpart G, regarding
[[Page 42750]]
facility design and construction and submit your SMS as required by 30
CFR 285.810.
Sec. 585.606 What must I demonstrate in my SAP?
Your SAP must demonstrate that you have planned and are prepared to
conduct the proposed site assessment activities in a manner that:
(a) Conforms to your responsibilities listed in Sec. 585.105(a);
(b) Conforms to all applicable laws, regulations, and provisions of
your commercial lease;
(c) Is safe;
(d) Does not unreasonably interfere with other uses of the OCS,
including those involved with national security or defense;
(e) Does not cause undue harm or damage to natural resources; life
(including human and wildlife); property; the marine, coastal, or human
environment; or sites, structures, or objects of historical or
archaeological significance;
(f) Uses best available and safest technology;
(g) Uses best management practices; and
(h) Uses properly trained personnel.
Sec. 585.607 How do I submit my SAP?
You must submit your SAP to BOEM pursuant to Sec. 585.111.
Sec. Sec. 585.608-585.609 [Reserved]
Contents of the Site Assessment Plan
Sec. 585.610 What must I include in my SAP?
(a) Project information may be provided using a PDE. When you
provide information using a PDE, BOEM reserves the right to determine
what range of values for any given parameter is acceptable. Your SAP
must include the following project-specific information, as applicable:
------------------------------------------------------------------------
Project information: Including:
------------------------------------------------------------------------
(1) Contact information........... The name, address, email address,
and phone number of an authorized
representative.
(2) The site assessment or A discussion of the objectives;
technology testing concept. description of the proposed
activities, including the
technology you will use; and
proposed schedule from start to
completion.
(3) Designation of operator, if As provided in Sec. 585.405.
applicable.
(4) Commercial lease stipulations A description of the measures you
and compliance. took, or will take, to satisfy the
conditions of any lease
stipulations related to your
proposed activities.
(5) A location plat, or indicative The range of surface locations and
layout. associated water depths for
proposed structures, facilities,
and appurtenances located both
offshore and onshore, including all
anchor and mooring data; and the
location and associated water
depths of all existing structures.
(6) General structural and project For facilities deemed complex or
design, fabrication, and significant you must provide
installation. preliminary design information for
each facility associated with your
site assessment activity and
subpart G of 30 CFR part 285
applies. For facilities not deemed
complex or significant you must
provide final design information.
(7) Deployment activities......... A description of the safety,
prevention, and environmental
protection features or measures
that you will use.
(8) Your proposed measures for A description of the measures you
avoiding, minimizing, reducing, will use to avoid or minimize
eliminating, and monitoring adverse effects and any potential
environmental impacts. incidental take, before you conduct
activities on your lease, and how
you will mitigate environmental
impacts from your proposed
activities, including a description
of the measures you will use as
required by Sec. Sec. 585.700
through 585.703.
(9) Project verification strategy. An analysis supporting your
recommendation as to whether your
site assessment activities should
be determined complex or
significant. If your recommendation
supports a complex or significant
determination, describe your
strategy for compliance with 30 CFR
285.705 through 285.714.
(10) References................... A bibliographic list of any document
or published source that you cite
as part of your plan. You may
reference information and data
discussed in other plans that you
previously submitted or that are
otherwise readily available to
BOEM.
(11) Decommissioning and site A discussion of general concepts and
clearance procedures. methodologies.
(12) Air quality information...... Information as described in Sec.
585.700.
(13) A listing of all Federal, A statement indicating whether you
State, and local authorizations have applied for or obtained such
or approvals required to conduct authorization or approval from the
site assessment activities. U.S. Coast Guard, U.S. Army Corps
of Engineers, and any other
applicable Federal, State, or local
authorizers.
(14) A list of agencies and Contact information and issues
persons with whom you have discussed.
communicated, or with whom you
will communicate, regarding
potential impacts associated with
your proposed activities.
(15) Financial assurance Statements attesting that the
information. activities and facilities proposed
in your SAP are or will be covered
by an appropriate bond or other
approved financial assurance
instrument as required in Sec.
585.516 and Sec. Sec. 585.525
through 585.529.
(16) Information you incorporate A list of the documents you have
by reference. incorporated by reference and their
public availability.
(17) Other information............ Additional information as required
by BOEM.
------------------------------------------------------------------------
(b) You must include reports that document the results of surveys
and investigations that characterize and model the site of your
proposed assessment activities. Your reports must address the following
topics:
[[Page 42751]]
----------------------------------------------------------------------------------------------------------------
Topic: Purpose of report: Including:
----------------------------------------------------------------------------------------------------------------
(1) Geological and geotechnical.... To define the baseline (i) Desktop studies to collect available data
geological conditions of from published sources and nearby sites.
the seabed and provide (ii) Geophysical surveys of the proposed area
sufficient data to develop with sufficient areal coverage, depth
a geologic model, assess penetration, and resolution to define the
geologic hazards, and geological conditions of the seabed at the
determine the feasibility site that could impact, or be impacted by,
of the proposed site for your proposed site assessment activities.
your assessment facility. (iii) Geotechnical investigations of
sufficient scope and detail to: ground truth
the geophysical surveys; support development
of a geological model; assess potential
geological hazards that could impact the
proposed site assessment activities; and
provide geotechnical data for design of the
site assessment facility, including type and
approximate dimensions of the foundation.
(iv) An overall site characterization report
for your site assessment facility that
integrates the findings of your studies,
surveys, and investigations; describes the
geological model; contains supporting data
and findings; and states your
recommendations.
(2) Biological..................... To determine the presence A description of the results of surveys used
of biological features and to evaluate the spatial and temporal
marine resources. distribution and abundance of biological
species in the site area, including migratory
and non-migratory species of vertebrate
animals such as fish, marine mammals, sea
turtles, and coastal and marine birds;
invertebrate animals; plants; algae; and
other organisms; also including the presence
of live bottoms, hard bottoms, topographic
features, and other marine resources.
(3) Archaeological resources and To provide BOEM with Archeological resource and other historic
other historic properties. required information to property identification surveys with
conduct review of your SAP supporting data.
under NHPA.
(4) Meteorological and To provide an overall Desktop studies to collect available data from
oceanographic (metocean). understanding of the hindcast or re-analysis models and field
meteorological and measurements in sufficient detail to support
oceanographic conditions design of your facility and support the
at the site of your analysis of wake effects, sediment mobility
proposed facility, and to and scour, and navigation risks.
identify conditions that
may pose a significant
risk to your facility.
----------------------------------------------------------------------------------------------------------------
Sec. 585.611 What information and certifications must I submit with
my SAP to assist BOEM in complying with NEPA and other applicable laws?
(a) Your SAP must contain detailed information and analysis to
assist BOEM in complying with NEPA and other applicable laws.
(b) When proposing site assessment activities in an area where BOEM
has no previous experience, your SAP must contain information about
resources, conditions, and activities listed in the following table
that your proposed activities may significantly affect or that may have
a significant effect on your proposed activities (including where the
potential significance of the effect is unknown) and must contain any
other information required by law.
------------------------------------------------------------------------
Type of information: Including:
------------------------------------------------------------------------
(1) Hazard information....... Meteorology, oceanography, sediment
transport, geology, and shallow
geological or manmade hazards.
(2) Water quality............ Turbidity and total suspended solids from
construction; impact from vessel
discharges.
(3) Biological resources..... Characterization of the spatial and
temporal distribution and abundance of
biological species in the site area,
such as benthic communities, marine
mammals, sea turtles, coastal and marine
birds, fish and shellfish, plankton, sea
grasses, and other plant life.
(4) Threatened or endangered As needed for ESA consultation.
species.
(5) Sensitive biological Essential fish habitat, refuges,
resources or habitats. preserves, special management areas
identified in coastal management
programs, nearby marine protected areas,
including State and Federal coastal and
marine protected areas, as well as
nearby national marine sanctuaries, and
nearby marine national monuments,
rookeries, hard bottom habitat,
chemosynthetic communities, calving
grounds, barrier islands, beaches,
dunes, and wetlands.
(6) Archaeological resources Required information to conduct review of
use, other historic property the COP under the NHPA or other
use, Indigenous traditional applicable laws or policies, including
cultural use, or use treaty and reserved rights with Native
pertaining to treaty and Americans or other Indigenous peoples.
reserved rights with Native
Americans or other
Indigenous peoples.
(7) Social and economic Employment, existing offshore and coastal
conditions. infrastructure (including major sources
of supplies, services, energy, and
water), land use, subsistence resources
and harvest practices, recreation,
recreational and commercial fishing
(including typical fishing seasons,
location, and type), minority and lower
income groups, coastal zone management
programs, and a visual impact
assessment.
(8) Coastal and marine uses.. Military activities, vessel traffic,
fisheries, and exploration and
development of other natural resources.
This includes a navigational safety risk
assessment that provides a description
of the predicted impacts of the project
to navigation, and the measures you will
use to avoid or minimize adverse
impacts. This document must also be
submitted to the U.S. Coast Guard to
assist with its analysis if your
proposal identifies potential
impediments to safe navigation.
[[Page 42752]]
(9) Consistency Certification If required by CZMA, under:
(i) 15 CFR part 930, subpart D, if the
SAP is submitted before lease issuance;
(ii) 15 CFR part 930, subpart E, if the
SAP is submitted after lease issuance.
(10) Other resources, As identified by BOEM.
conditions, and activities.
------------------------------------------------------------------------
(c) When proposing site assessment activities in an area BOEM
previously considered, BOEM will review your SAP to determine if its
impacts are consistent with those previously considered. If the
anticipated effects of your proposed SAP activities are significantly
different than those previously anticipated, we may determine that
additional NEPA and other relevant Federal reviews are required. In
that case, BOEM will notify you of such determination, and you must
submit information required in paragraph (b) of this section as
appropriate.
Sec. 585.612 How will my SAP be processed for Federal consistency
under the Coastal Zone Management Act?
Your SAP will be processed based on whether it is submitted before
or after your lease is issued:
------------------------------------------------------------------------
Consistency review of your SAP will be
If your SAP is submitted: handled as follows:
------------------------------------------------------------------------
(a) Before lease issuance.... You will furnish a copy of your SAP,
consistency certification, and necessary
data and information to conduct an
adequate consistency review to the
applicable State CZMA agency or agencies
if required by 15 CFR part 930, subpart
D. and submit a copy to BOEM in
accordance with Sec. 585.111.
(b) After lease issuance..... You must submit a copy of your SAP,
consistency certification, and necessary
data and information pursuant to 15 CFR
part 930, subpart E, to BOEM only if
BOEM did not consider the proposed site
assessment activities for your lease
area under its previously submitted
consistency determination under 15 CFR
part 930, subpart C, and if required by
15 CFR part 930, subpart E. BOEM will
forward to the applicable State CZMA
agency or agencies one copy of your SAP,
consistency certification, and necessary
data and information required to conduct
an adequate consistency review under 15
CFR part 930, subpart E, after BOEM has
determined that all information
requirements for the SAP are met.
------------------------------------------------------------------------
Sec. 585.613 How will BOEM process my SAP?
(a) BOEM will review your submitted SAP, and additional information
provided pursuant to Sec. 585.611, to determine if it contains the
information necessary to conduct our technical and environmental
reviews.
(1) We will notify you if we deem your proposed facility or
combination of facilities to be complex or significant; and
(2) We will notify you if your submitted SAP lacks any necessary
information.
(b) BOEM will prepare a NEPA analysis, as appropriate.
(c) As appropriate, we will coordinate and consult with relevant
Federal and State agencies, affected federally recognized Indian Tribes
and executives of relevant local governments and will provide to other
Federal, State, and local agencies and affected federally recognized
Indian Tribes relevant nonproprietary data and information pertaining
to your proposed activities.
(d) During the review process, we may request additional
information if we determine that the information provided is not
sufficient to complete the review and approval process. If you fail to
provide the requested information, BOEM may disapprove your SAP.
(e) Upon completion of our technical and environmental reviews and
other reviews required by Federal laws (e.g., CZMA), BOEM will approve,
disapprove, or approve with conditions your SAP.
(1) If we approve your SAP, we will specify terms and conditions to
be incorporated into your SAP. You must certify compliance with those
terms and conditions, required under 30 CFR 285.615(b); and
(2) If we disapprove your SAP, we will inform you of the reasons
and allow you an opportunity to submit a revised plan addressing our
concerns, and we may suspend your lease, as appropriate, to give you a
reasonable amount of time to resubmit the SAP.
Activities Under an Approved SAP
Sec. 585.614 When may I begin conducting activities under my approved
SAP?
(a) You may begin conducting the activities approved in your SAP
following BOEM approval of your SAP.
(b) If you are installing a facility or a combination of facilities
deemed by BOEM to be complex or significant, as provided in Sec.
585.613(a)(1), you must comply with the requirements of 30 CFR part
285, subpart G, and also submit your Safety Management System
description required by 30 CFR 285.810 before construction may begin.
Sec. 585.615 What other reports or notices must I submit to BOEM
under my approved SAP?
You must prepare and submit to BOEM a report annually on November
1st of each year that summarizes your site assessment activities and
the results of those activities. BOEM will withhold trade secrets and
commercial or financial information that is privileged or confidential
from public disclosure under exemption 4 of the FOIA and as provided in
Sec. 585.114.
Sec. 585.616 [Reserved]
Sec. 585.617 What activities require a revision to my SAP, and when
will BOEM approve the revision?
(a) You must notify BOEM in writing before conducting site
assessment activities not described in your approved SAP involving
facilities that are installed on the seabed using a fixed-bottom
foundation requiring professional engineering design and assessment of
sediment, meteorological, and oceanographic conditions as part of the
design. Your notice must describe in detail the type of activities you
propose to conduct. We will determine whether the activities you
propose require a revision to your SAP. We may request additional
information from you, if necessary, to make this determination.
(b) If a revised SAP is required, BOEM will reassess, upon its
receipt, whether the facility or combination of facilities described in
it is complex or significant.
(1) If BOEM determines that the facilities described in your
revised SAP are not complex or significant, you may conduct your
approved activities under Sec. 585.614(a).
(2) If BOEM determines that the facilities described in your
revised SAP
[[Page 42753]]
are complex or significant, you must comply with Sec. 585.614(b).
(c) BOEM will periodically review the activities conducted under an
approved SAP. The frequency and extent of the review will be based on
the significance of any changes in available information and on onshore
or offshore conditions affecting or affected by the activities
conducted under your SAP. If the review indicates that the SAP should
be revised to meet the requirements of this part, BOEM will require you
to submit the needed revisions.
(d) Activities for which a proposed revision to your SAP likely
will be necessary include:
(1) Activities on the OCS not described in your approved SAP that
could have significant environmental impacts or that may affect
threatened or endangered species, or that may affect designated
critical habitat of such species, or that may result in incidental take
of marine mammals;
(2) Modifications to the number, size, or type of facilities
(including associated components) or equipment you will use outside of
the PDE that was approved for your project;
(3) Changes in the geographical location or layout of your bottom
disturbances, offshore facilities, or onshore support bases beyond the
range of possible locations described in your approved SAP;
(4) Structural failure of any facility operated under your approved
SAP; or
(5) Changes to any other activity specified by BOEM.
(e) We may begin the appropriate NEPA analysis and other relevant
consultations when we determine that a proposed revision could:
(1) Result in a significant change in the impacts previously
identified and evaluated;
(2) Require any additional Federal authorizations; or
(3) Involve activities not previously identified and evaluated.
(f) When you propose a revision, we may approve the revision if we
determine that the revision is:
(1) Designed not to cause undue harm or damage to natural
resources; life (including human and wildlife); property; the marine,
coastal, or human environment; or sites, structures, or objects of
historical or archaeological significance; and
(2) Otherwise, consistent with the provisions of section 8(p) of
the OCS Lands Act.
Sec. 585.618 What must I do upon completion of approved site
assessment activities?
(a) If your COP or FERC license application describes the continued
use of existing facilities approved in your SAP, you may keep such
facilities in place on your lease during the time that BOEM reviews
your COP or FERC reviews your license application.
(b) You are not required to initiate the decommissioning process
for facilities that are authorized to remain in place under your
approved COP or approved FERC license.
(c) If, following the technical and environmental review of your
submitted COP, BOEM determines that such facilities may not remain in
place, you must initiate the decommissioning process, as provided in 30
CFR part 285, subpart I.
(d) If FERC determines that such facilities may not remain in
place, you must initiate the decommissioning process as provided in 30
CFR part 285, subpart I.
(e) You must decommission your site assessment facilities as set
forth in 30 CFR part 285, subpart I, upon the termination of your
lease. You must submit your decommissioning application as required in
30 CFR 285.905 and 285.906.
Sec. 585.619 [Reserved]
Construction and Operations Plan for Commercial Leases
Sec. 585.620 What is a Construction and Operations Plan (COP)?
The COP describes your construction, operations, and conceptual
decommissioning plans under your commercial lease, including your
project easement. BOEM will withhold trade secrets and commercial or
financial information that is privileged or confidential from public
disclosure under exemption 4 of the FOIA and in accordance with the
terms of Sec. 585.114.
(a) Your COP must describe all planned facilities that you will
construct and use for your project, including onshore and support
facilities and all anticipated project easements.
(b) Your COP must describe all proposed activities including your
proposed construction activities, commercial operations, and conceptual
decommissioning plans for all planned facilities, including onshore and
support facilities.
(c) You must receive BOEM approval of your COP before you can begin
any of the approved activities on your lease.
Sec. 585.621 What must I demonstrate in my COP?
Your COP must demonstrate that you have planned and are prepared to
conduct the proposed activities in a manner that:
(a) Conforms to your responsibilities listed in Sec. 585.105(a);
(b) Conforms to all applicable laws, regulations, and provisions of
your commercial lease;
(c) Is safe;
(d) Does not unreasonably interfere with other uses of the OCS,
including those involved with national security or defense;
(e) Does not cause undue harm or damage to natural resources; life
(including human and wildlife); property; the marine, coastal, or human
environment; or sites, structures, or objects of historical or
archaeological significance;
(f) Uses best available and safest technology;
(g) Uses best management practices; and
(h) Uses properly trained personnel.
Sec. 585.622 How do I submit my COP?
(a) You must submit your COP to BOEM pursuant to Sec. 585.111.
(b) You may submit information and a request for any project
easement as part of your original COP submission or as a revision to
your COP.
Sec. Sec. 585.623-585.625 [Reserved]
Contents of the Construction and Operations Plan
Sec. 585.626 What must I include in my COP?
(a) Project information may be provided using a PDE. When you
provide information using a PDE, BOEM reserves the right to determine
what range of values for any given parameter is acceptable. Your COP
must include the following project-specific information, as applicable:
------------------------------------------------------------------------
Project information: Including:
------------------------------------------------------------------------
(1) Contact information........... The name, address, email address,
and phone number of an authorized
representative.
(2) Designation of operator, if As provided in Sec. 585.405.
applicable.
(3) Commercial lease stipulations A description of the measures you
and compliance. took, or will take, to satisfy the
conditions of any lease
stipulations related to your
proposed activities.
[[Page 42754]]
(4) A location plat, or indicative The range of surface locations and
layout. associated water depths for
proposed structures, facilities,
and appurtenances located both
offshore and onshore, including all
anchor and mooring data, and the
location and associated water
depths of all existing structures.
(5) General structural and project Preliminary design information for
design, fabrication, and each facility associated with your
installation. project including information
needed to justify any request for
an operations period exceeding the
length provided in this part or the
lease.
(6) Deployment activities......... A description of safety, prevention,
and environmental protection
features or measures that you will
use.
(7) A list of solid and liquid Disposal methods and locations.
wastes generated.
(8) A listing of chemical products A list of chemical products used;
used (if stored volume exceeds the volume stored on location;
Environmental Protection Agency their treatment, discharge, or
(EPA) reportable quantities). disposal methods used; and the name
and location of the onshore waste
receiving, treatment, and/or
disposal facility. A description of
how these products would be brought
onsite, the number of transfers
that may take place, and the
quantity that will be transferred
each time.
(9) A description of any vessels, An estimate of the frequency and
vehicles, and aircraft you will duration of vessel, vehicle, or
use to support your activities. aircraft traffic.
(10) A general description of the (i) Under normal conditions.
operating procedures and systems. (ii) In the case of accidents or
emergencies, including those that
are natural or manmade.
(11) Decommissioning and site A discussion of general concepts and
clearance procedures. methodologies.
(12) A listing of all Federal, A statement indicating whether you
State, and local authorizations have applied for or obtained such
or approvals required to conduct authorization or approval from the
the proposed activities, U.S. Coast Guard, U.S. Army Corps
including commercial operations. of Engineers, and any other
applicable Federal, State, or local
authorizers pertaining to energy
gathering, transmission, or
distribution (e.g., interconnection
authorizations).
(13) Your proposed measures for A description of the measures you
avoiding, minimizing, reducing, will use to avoid or minimize
eliminating, and monitoring adverse effects and any potential
environmental impacts. incidental take before you conduct
activities on your lease, and how
you will mitigate environmental
impacts from your proposed
activities, including a description
of the measures you will use as
required by Sec. Sec. 585.700
through 585.703.
(14) Information you incorporate A list of the documents you have
by reference. incorporated by reference and their
public availability.
(15) A list of agencies and Contact information and issues
persons with whom you have discussed.
communicated, or with whom you
will communicate, regarding
potential impacts associated with
your proposed activities.
(16) References................... A bibliographic list of any document
or published source that you cite
as part of your plan. You may
reference information and data
discussed in other plans you
previously submitted or that are
otherwise readily available to
BOEM.
(17) Financial assurance.......... Statements attesting that the
activities and facilities proposed
in your COP are or will be covered
by an appropriate bond or other
approved financial assurance
instrument as required in Sec.
585.516 and Sec. Sec. 585.525
through 585.529.
(18) Project verification strategy You must describe your strategy for
compliance with 30 CFR285.705
through 285.714.
(19) Construction schedule........ A reasonable schedule of
construction activity showing
significant milestones, including
the commencement of commercial
operations consistent with the
requirements of 30 CFR part 285,
subpart G.
(20) Air quality information...... Information as described in Sec.
585.700.
(21) Other information............ Additional information as required
by BOEM.
------------------------------------------------------------------------
(b) You must include reports that document the results of surveys
and investigations that characterize and model the site of your
proposed project. Your reports must address the following topics:
----------------------------------------------------------------------------------------------------------------
Topic: Purpose of report: Including:
----------------------------------------------------------------------------------------------------------------
(1) Geological and geotechnical.... To define the baseline (i) Desktop studies to collect available data
geological conditions of from published sources and nearby sites.
the seabed and provide (ii) Geophysical surveys of the proposed area
sufficient data to develop with sufficient areal coverage, depth
a geologic model, assess penetration, and resolution to define the
geologic hazards, and geological conditions of the site's seabed
determine the feasibility that could impact, or be impacted by, the
of the proposed site for proposed project.
your proposed facility. (iii) Geotechnical investigations of
sufficient scope and detail to: ground truth
the geophysical surveys; support development
of a geological model; assess potential
geological hazards that could impact the
proposed project; and provide geotechnical
data for preliminary design of the facility,
including type and approximate dimensions of
the foundation.
(iv) An overall site characterization report
for your facility that integrates the
findings of your studies, surveys, and
investigations; describes the geological
model; contains supporting data and findings;
and states your recommendations.
[[Page 42755]]
(2) Biological..................... To determine the presence A description of the results of biological
of biological features and surveys used to determine the presence of
marine resources.. live bottoms, hard bottoms, topographic
features, and other marine resources,
including migratory populations such as fish,
marine mammals, sea turtles, and sea birds.
(3) Archaeological resources and To provide BOEM with Archaeological resources and other historic
other historic properties. required information to properties.
conduct review of the COP
under NHPA.
(4) Meteorological and To provide an overall Desktop studies to collect available data from
oceanographic (metocean). understanding of the hindcast or re-analysis models and field
meteorological and measurements in sufficient detail to support
oceanographic conditions preliminary design of the facility and
at the site of the support the analysis of wake effects,
proposed facility, and to sediment mobility and scour, and navigational
identify conditions that risks
may pose a significant
risk to the facility.
----------------------------------------------------------------------------------------------------------------
Sec. 585.627 What information and certifications must I submit with
my COP to assist BOEM in complying with NEPA and other applicable laws?
(a) Your COP must contain detailed information and analysis to
assist BOEM in complying with NEPA and other applicable laws. Your COP
must contain information about those resources, conditions, and
activities listed in the following table that your proposed activities
may significantly affect, or that may have a significant effect on your
proposed activities (including where the potential significance of the
effect is unknown) and must contain any other information required by
law:
------------------------------------------------------------------------
Type of information: Including:
------------------------------------------------------------------------
(1) Hazard information....... Meteorology, oceanography, sediment
transport, geology, and shallow
geological or manmade hazards.
(2) Water quality............ Turbidity and total suspended solids from
construction; impact from vessel
discharges.
(3) Biological resources..... Benthic communities, marine mammals, sea
turtles, coastal and marine birds, fish
and shellfish, plankton, seagrasses, and
plant life.
(4) Threatened or endangered As required by ESA.
species.
(5) Sensitive biological Essential fish habitat, refuges,
resources or habitats. preserves, special management areas
identified in coastal management
programs, nearby marine protected areas,
including State and Federal coastal and
nearby marine protected areas, as well
as national marine sanctuaries and
nearby marine national monuments,
rookeries, hard bottom habitat,
chemosynthetic communities, calving
grounds, barrier islands, beaches,
dunes, and wetlands.
(6) Archaeological resources Required information to conduct review of
use, other historic property the COP under the NHPA or other
use, Indigenous traditional applicable laws or policies, including
cultural use, or use treaty and reserved rights with Native
pertaining to treaty and Americans or other Indigenous peoples.
reserved rights with Native
Americans or other
Indigenous peoples.
(7) Social and economic Employment, existing offshore and coastal
resources. infrastructure (including major sources
of supplies, services, energy, and
water), land use, subsistence resources
and harvest practices, recreation,
recreational and commercial fishing
(including typical fishing seasons,
location, and type), minority and lower
income groups, coastal zone management
programs, and a visual impact
assessment.
(8) Coastal and marine uses.. Military activities, vessel traffic,
fisheries, and exploration and
development of other natural resources.
This includes a navigational safety risk
assessment that provides a description
of the predicted impacts of the project
to navigation and the measures you will
use to avoid or minimize such adverse
impacts. This document also must be
submitted to the U.S. Coast Guard to
assist with its analysis.
(9) Consistency Certification If required by CZMA regulations:
(i) 15 CFR part 930, subpart D, if your
COP is submitted before lease issuance.
(ii) 15 CFR part 930, subpart E, if your
COP is submitted after lease issuance.
(10) Other resources, As identified by BOEM.
conditions, and activities.
------------------------------------------------------------------------
(b) You must submit one copy of your consistency certification.
Your consistency certification must include:
(1) One copy of your consistency certification either under
subsection 307(c)(3)(B) of the CZMA (16 U.S.C. 1456(c)(3)(B)) and 15
CFR 930.76, or under subsection 307(c)(3)(A) of the CZMA (16 U.S.C.
1456(c)(3)(A)) and 15 CFR 930.57, stating that the proposed activities
described in detail in your plans comply with the enforceable policies
of the applicable States' approved coastal management programs and will
be conducted in a manner that is consistent with such programs; and
(2) ``Necessary data and information,'' as required by 15 CFR
930.58.
(c) You must submit a detailed description of an oil spill response
plan to BSEE in compliance with 33 U.S.C. 1321, including information
identified in 30 CFR part 254 that is applicable to your activities.
(d) You must submit a detailed description of your safety
management system to BSEE as required by 30 CFR 285.810.
Sec. 585.628 How will BOEM process my COP?
(a) BOEM will review your submitted COP, including the information
provided under Sec. 585.627, to determine if it contains the
information necessary to conduct our technical and environmental
reviews. We will notify you if your submitted COP lacks any necessary
information.
(b) BOEM will prepare an appropriate NEPA analysis.
(c) If your COP is subject to Federal consistency review under CZMA
[[Page 42756]]
regulations at 15 CFR part 930, subpart E, you must submit your COP,
consistency certification, and associated data and information under
CZMA to BOEM after all information requirements for the COP are met,
and the appropriate environmental assessment or draft environmental
impact statement, if required, has been published. BOEM will forward
the COP, consistency certification, and associated data and information
to the applicable State CZMA agencies.
(d) As appropriate, BOEM will coordinate and consult with relevant
Federal, State, and local agencies and affected federally recognized
Indian Tribes, and provide to them relevant nonproprietary data and
information pertaining to your proposed activities.
(e) During the review process, we may request additional
information if we determine that the information provided is not
sufficient to complete the review and approval process. If you fail to
provide the requested information, BOEM may disapprove your COP.
(f) Upon completion of our technical and environmental reviews and
other reviews required by Federal law (e.g., CZMA), BOEM will approve,
disapprove, or approve your COP with conditions.
(1) If we approve your COP, we will specify terms and conditions to
be incorporated into your COP. You must certify compliance with certain
of those terms and conditions, as required under 30 CFR 285.633(a); and
(2) If we disapprove your COP, we will inform you of the reasons
and allow you an opportunity to submit a revised plan addressing our
concerns, and we may suspend the COP review period of your lease, as
appropriate, to give you a reasonable amount of time to submit the
revised plan.
(g) If BOEM approves your project easement, BOEM will issue an
addendum to your lease specifying the terms of the project easement.
(1) The project easement will provide sufficient off-lease area to
accommodate potential changes at the design and installation phases
with respect to any facilities or activities necessary for your
project.
(2) Unused portions of the project easement may be relinquished
after construction is complete.
(3) A project easement is subject to the following conditions:
(i) The rights granted will not prevent the granting of other
rights by the United States, either before or after the granting of the
project easement, provided that any subsequent authorization issued by
BOEM in the area of a previously issued project easement may not
unreasonably interfere with activities approved or impede existing
operations under the project easement; and
(ii) If the project easement is granted in an area where a lease,
ROW or RUE grant has previously been issued, the project easement
holder must agree that its activities will not unreasonably interfere
with or impede existing operations under the lease or ROW or RUE grant.
Sec. Sec. 585.629-585.630 [Reserved]
Activities Under an Approved COP
Sec. 585.631 When must I initiate activities under an approved COP?
After your COP is approved, you are expected to commence
construction on the OCS in accordance with the construction schedule
included as a part of your approved COP, unless you notify BOEM in
advance of a deviation from your schedule.
Sec. 585.632 What documents must I submit before I may construct and
install facilities under my approved COP?
(a) You must submit to BSEE the documents listed in the following
table:
------------------------------------------------------------------------
Document: Requirements are found in:
------------------------------------------------------------------------
(1) Facility Design Report................ 30 CFR 285.701.
(2) Fabrication and Installation Report... 30 CFR 285.702.
------------------------------------------------------------------------
(b) You must submit your Safety Management System, as required by
30 CFR 285.810.
(c) These activities must fall within the scope of your approved
COP. If they do not fall within the scope of your approved COP, you
will be required to submit a revision to your COP, under Sec. 585.634,
for BOEM approval before commencing the activity.
Sec. 585.633 [Reserved]
Sec. 585.634 What activities require a revision to my COP, and when
will BOEM approve the revision?
(a) You must notify BOEM in writing before conducting any
activities on the OCS not described in your approved COP. Your notice
must describe in detail the type of activities you propose to conduct.
We will determine whether the activities you propose require a revision
to your COP. We may request additional information from you, if
necessary, to make this determination.
(b) BOEM will periodically review the activities conducted under an
approved COP. The frequency and extent of the review will be based on
the significance of any changes in available information, and on
onshore or offshore conditions affecting, or affected by, the
activities conducted under your COP. If the review indicates that the
COP should be revised to meet the requirement of this part, BOEM will
require you to submit the needed revisions.
(c) Activities for which a proposed revision to your COP likely
will be necessary include:
(1) Activities on the OCS not described in your approved COP that
could have significant environmental impacts, that may affect
threatened or endangered species, or affect designated critical habitat
of such species, or that may result in incidental take of marine
mammals;
(2) Modifications to the number, size, or type of facilities
(including associated components) or equipment you will use outside of
the PDE that was approved for your project;
(3) Material changes in the geographical location or layout of
bottom disturbances, offshore facilities, or onshore support bases
beyond the range of possible locations described in your approved COP;
(4) Structural failure of any facility operated under your approved
COP;
(5) Submission of an FDR or FIR that contains new activities beyond
the scope of or that is materially inconsistent with the COP that has
been previously submitted; or
(6) Change in any other activity specified by BOEM.
(d) We may begin the appropriate NEPA analysis and relevant
consultations when we determine that a proposed revision could:
(1) Result in a significant change in the impacts previously
identified and evaluated;
(2) Require any additional Federal authorizations; or
(3) Involve activities not previously identified and evaluated that
could have significant environmental impacts, that may affect
threatened or endangered species, or designated critical habitat of
such species, or that may result in incidental take of marine mammals.
(e) When you propose a revision, we may approve the revision if we
determine that the revision is:
(1) Designed not to cause undue harm or damage to natural
resources; life (including human and wildlife); property; the marine,
coastal, or human environment; or sites, structures, or objects of
historical or archaeological significance; and
(2) Otherwise consistent with the provisions of subsection 8(p) of
the OCS Lands Act.
[[Page 42757]]
Sec. 585.635 What must I do if I cease activities approved in my COP
before the end of my commercial lease?
You must notify BSEE, within 5 business days, any time you cease
commercial operations, without an approved suspension, under your
approved COP. If you cease commercial operations for an indefinite
period, which extends longer than 6 months, we may cancel your lease
under Sec. 585.422 and you must initiate the decommissioning process
as set forth in 30 CFR part 285, subpart I.
Sec. Sec. 585.636-585.639 [Reserved]
General Activities Plan Requirements for Limited Leases, ROW Grants,
and RUE Grants
Sec. 585.640 What is a General Activities Plan (GAP)?
(a) A GAP describes your proposed construction, activities, and
conceptual decommissioning plans for all planned facilities, including
testing of technology devices and onshore and support facilities that
you will construct and use for your project, including any project
easements for the assessment and development of your limited lease or
grant.
(b) You must receive BOEM approval of your GAP before you can begin
any of the proposed activities on your lease or grant.
Sec. 585.641 What must I demonstrate in my GAP?
Your GAP must demonstrate that you have planned and are prepared to
conduct the proposed activities in a manner that:
(a) Conforms to your responsibilities listed in Sec. 585.105(a);
(b) Conforms to all applicable laws, regulations, and provisions of
your limited lease or grant;
(c) Is safe;
(d) Does not unreasonably interfere with other uses of the OCS,
including those involved with national security or defense;
(e) Does not cause undue harm or damage to natural resources; life
(including human and wildlife); property; the marine, coastal, or human
environment; or sites, structures, or objects of historical or
archaeological significance;
(f) Uses best available and safest technology;
(g) Uses best management practices; and
(h) Uses properly trained personnel.
Sec. 585.642 How do I submit my GAP?
(a) You must submit your GAP to BOEM pursuant to Sec. 585.111.
(b) If you have a limited lease, you may submit information on any
project easement as part of your original GAP submission or as a
revision to your GAP.
Sec. Sec. 585.643-585.644 [Reserved]
Contents of the General Activities Plan
Sec. 585.645 What must I include in my GAP?
(a) Project information may be provided using a PDE. When you
provide a range of parameters using a PDE, BOEM reserves the right to
determine what range of values for any given parameter is acceptable.
Your GAP must include the following project-specific information, as
applicable:
------------------------------------------------------------------------
Project information: Including:
------------------------------------------------------------------------
(1) Contact information...... The name, address, email address, and
phone number of an authorized
representative.
(2) Designation of operator, As provided in Sec. 585.405.
if applicable.
(3) Your proposed A discussion of the objectives;
construction, activities, description of the proposed activities,
and conceptual including the technology you will use;
decommissioning plans, and/ and proposed schedule from start to
or technology testing completion.
concept.
(4) ROW or RUE grant, or A description of the measures you took,
limited lease stipulations, or will take, to satisfy the conditions
if known. of any grant or lease stipulations
related to your proposed activities.
(5) A location plat, or The range of surface locations and
indicative layout. associated water depths for proposed
structures, facilities, and
appurtenances located both offshore and
onshore, including all anchor and
mooring data; and the location and
associated water depths of all existing
structures.
(6) General structural and Preliminary design information for each
project design, fabrication, facility associated with your project.
and installation.
(7) Deployment activities.... A description of the safety, prevention,
and environmental protection features or
measures that you will use.
(8) Your proposed measures A description of the measures you will
for avoiding, minimizing, use to avoid or minimize adverse effects
reducing, eliminating, and and any potential incidental take before
monitoring environmental you conduct activities on your lease,
impacts. and how you will mitigate environmental
impacts from your proposed activities,
including a description of the measures
you will use as required by Sec. Sec.
585.701 through 585.703.
(9) A list of solid and Disposal methods and locations.
liquid wastes generated.
(10) A listing of chemical A list of chemical products used; the
products used (if stored volume stored on location; their
volume exceeds EPA treatment, discharge, or disposal
reportable quantities). methods used; and the name and location
of the onshore waste receiving,
treatment, and/or disposal facility. A
description of how these products would
be brought onsite, the number of
transfers that may take place, and the
quantity that will be transferred each
time.
(11) A description of any An estimate of the frequency and duration
vessels, vehicles, and of vessel, vehicle, and aircraft
aircraft you will use to traffic.
support your activities.
(12) Reference information... A bibliographic list of any document or
published source that you cite as part
of your plan. You may reference
information and data discussed in other
plans you previously submitted or that
are otherwise readily available to BOEM.
(13) Decommissioning and site A discussion of general concepts and
clearance procedures. methodologies.
(14) Air quality information. As described in Sec. 585.700.
(15) A listing of all A statement indicating whether you have
Federal, State, and local applied for or obtained such
authorizations or approvals authorization or approval from the U.S.
required to conduct Coast Guard, U.S. Army Corps of
activities on your grant or Engineers, and any other applicable
limited lease. Federal, State, or local authorizers
pertaining to your activities.
(16) A list of agencies and Contact information and issues discussed.
persons with whom you have
communicated, or with whom
you will communicate,
regarding potential impacts
associated with your
proposed activities.
[[Page 42758]]
(17) Financial assurance Statements attesting that the activities
information. and facilities proposed in your GAP are,
or an explanation of how they will be,
covered by an appropriate bond or other
approved security, as required in Sec.
Sec. 585.520 and 585.521.
(18) Project verification You must describe your strategy for
strategy. compliance with 30 CFR 285.705 through
285.714.
(19) Information you A list of the documents you have
incorporate by reference. incorporated by reference and where they
may be publicly accessed; for
confidential information, you may
reference information and data discussed
in other plans previously submitted or
that are otherwise readily available to
BOEM.
(20) Other information....... Additional information as required by
BOEM.
------------------------------------------------------------------------
(b) You must include reports that document the results of surveys
and investigations that characterize and model the site of your
proposed activities. Your reports must cover the following topics:
----------------------------------------------------------------------------------------------------------------
Topic: Purpose of report: Including:
----------------------------------------------------------------------------------------------------------------
(1) Geological and geotechnical.... To define the baseline (i) Desktop studies to collect available data
geological conditions of from published sources and nearby sites.
the seabed and provide (ii) Geophysical surveys of the proposed area
sufficient data to develop with sufficient areal coverage, depth
a geologic model, assess penetration, and resolution to define the
geologic hazards, and geological conditions of the seabed at the
determine the feasibility site that could impact, or be impacted by,
of the proposed facility. the proposed project.
(iii) Geotechnical investigations of
sufficient scope and detail to: ground truth
the geophysical surveys; support development
of a geological model; assess potential
geological hazards that could impact the
proposed development; and provide
geotechnical data for preliminary design of
the facility, including type and approximate
dimensions of the foundation.
(iv) An overall site characterization report
for your facility that integrates the
findings of your studies, surveys, and
investigations; describes the geological
model; contains supporting data and findings;
and states your recommendations.
(2) Biological..................... To determine the presence A description of the results of biological
of biological features and surveys used to determine the presence of
marine resources. live bottoms, hard bottoms, topographic
features, and other marine resources,
including migratory populations, such as
fish, marine mammals, sea turtles, and sea
birds.
(3) Archaeological resources and To provide BOEM with Archaeological resource and other historic
other historic properties. required information to property identification surveys with
conduct review of the GAP supporting data.
under NHPA.
(4) Meteorological and To provide an overall Desktop studies to collect available data from
oceanographic (metocean). understanding of the hindcast or re-analysis models and field
meteorological and measurements in sufficient detail to support
oceanographic conditions preliminary design of the facility and
at the site of the support the analysis of wake effects,
proposed facility, and to sediment mobility and scour, and navigation
identify conditions that risks.
may pose a significant
risk to the facility.
----------------------------------------------------------------------------------------------------------------
(c) If you are applying for a project easement, or constructing a
facility or a combination of facilities deemed by BOEM to be complex or
significant, you must provide the following additional information and
comply with the requirements of 30 CFR part 285, subpart G:
------------------------------------------------------------------------
Project information: Including:
------------------------------------------------------------------------
(1) The construction and A discussion of the objectives,
operation concept. description of the proposed activities,
and tentative schedule from start to
completion.
(2) All cables and pipelines, The location, design, installation
including cables on project methods, testing, maintenance, repair,
easements. safety devices, exterior corrosion
protection, inspections, and
decommissioning.
(3) A general description of (i) Under normal conditions.
the operating procedures and (ii) In the case of accidents or
systems. emergencies, including those that are
natural or manmade.
(4) Construction schedule.... A reasonable schedule of construction
activity showing significant milestones
including the commencement of activities
consistent with the requirements of 30
CFR part 285, subpart G.
(5) Other information........ Additional information as requested by
BOEM.
------------------------------------------------------------------------
(d) BOEM will withhold trade secrets and commercial or financial
information that is privileged or confidential from public disclosure
in accordance with the terms of Sec. 585.114.
Sec. 585.646 What information and certifications must I submit with
my GAP to assist BOEM in complying with NEPA and other applicable laws?
You must submit, with your GAP, detailed information and analysis
to assist BOEM in complying with NEPA and other applicable laws.
(a) A GAP submitted for an area in which BOEM has not reviewed GAP
activities under NEPA or other applicable Federal laws must describe
those resources, conditions, and
[[Page 42759]]
activities listed in paragraphs (b)(1) through (10) of this section
that your proposed activities may significantly affect or that may have
a significant effect on your activities proposed in your GAP (including
where the potential significance of the effect is unknown) and must
contain any other information required by law.
(b) For a GAP submitted for an area in which BOEM has considered
GAP activities under applicable Federal law (e.g., a NEPA analysis and
CZMA consistency determination for the GAP activities), BOEM will
review the GAP to determine if its impacts are consistent with those
previously considered. If the anticipated effects of your proposed GAP
activities are significantly different than those previously
anticipated, we may determine that additional NEPA and other relevant
Federal reviews are required. In that case, BOEM will notify you of
such determination, and you must submit a GAP that describes those
resources, conditions, and activities listed in the following table
that your proposed activities may significantly affect or that may have
a significant effect on your activities proposed in your GAP (including
where the potential significance of the effect is unknown) and must
contain any other information required by law, including:
------------------------------------------------------------------------
Type of information: Including:
------------------------------------------------------------------------
(1) Hazard information....... Meteorology, oceanography, sediment
transport, geology, and shallow
geological or manmade hazards.
(2) Water quality............ Turbidity and total suspended solids from
construction; impact from vessel
discharges.
(3) Biological resources..... Benthic communities, marine mammals, sea
turtles, coastal and marine birds, fish
and shellfish, plankton, sea grasses,
and other plant life.
(4) Threatened or endangered As required by the ESA (16 U.S.C. 1531 et
species. seq.).
(5) Sensitive biological Essential fish habitat, refuges,
resources or habitats. preserves, special management areas
identified in coastal management
programs, marine protected areas,
including State and Federal coastal and
marine protected areas, as well as
nearby national marine sanctuaries and
nearby marine national monuments,
rookeries, hard bottom habitat,
chemosynthetic communities, calving
grounds, barrier islands, beaches,
dunes, and wetlands.
(6) Archaeological resources Required information to conduct review of
use, other historic property the COP under the NHPA or other
use, Indigenous traditional applicable laws or policies, including
cultural use, or use treaty and reserved rights with Native
pertaining to treaty and Americans or other Indigenous peoples.
reserved rights with Native
Americans or other
Indigenous peoples.
(7) Social and economic Employment, existing offshore and coastal
conditions. infrastructure (including major sources
of supplies, services, energy, and
water), land use, subsistence resources
and harvest practices, recreation,
recreational and commercial fishing
(including typical fishing seasons,
location, and type), minority and lower
income groups, coastal zone management
programs, and a visual impact
assessment.
(8) Coastal and marine uses.. Military activities, vessel traffic,
fisheries, and exploration and
development of other natural resources.
This includes a navigational safety risk
assessment that provides a description
of the predicted impacts of the project
to navigation, and the measures you will
use to avoid or minimize such adverse
impacts. This document also must be
submitted to the U.S. Coast Guard to
assist with its analysis if your
proposal identifies potential
impediments to safe navigation.
(9) Consistency Certification If required by CZMA, under:
(i) 15 CFR part 930, subpart D, if the
GAP is submitted before lease or grant
issuance;
(ii) 15 CFR part 930, subpart E, if the
GAP is submitted after lease or grant
issuance.
(10) Other resources, As required by BOEM.
conditions, and activities.
------------------------------------------------------------------------
Sec. 585.647 How will my GAP be processed for Federal consistency
under the Coastal Zone Management Act?
Your GAP will be processed based on whether it is submitted before
or after your lease or grant is issued:
------------------------------------------------------------------------
Consistency review of your GAP will be
If your GAP is submitted: handled as follows:
------------------------------------------------------------------------
(a) Before lease or grant You will furnish a copy of your GAP,
issuance. consistency certification, and necessary
data and information to conduct an
adequate consistency review to the
applicable State CZMA agencies if
required by 15 CFR part 930, subpart D.
Submit a copy to BOEM pursuant to Sec.
585.111.
(b) After lease or grant You will submit a copy of your GAP,
issuance. consistency certification, and necessary
data and information to BOEM if required
by 15 CFR part 930, subpart E. BOEM will
forward to the applicable State CZMA
agency or agencies one copy of your GAP,
consistency certification, and necessary
data and information to conduct an
adequate consistency review required
under 15 CFR part 930, subpart E, after
BOEM has determined that all information
requirements for the GAP are met.
------------------------------------------------------------------------
Sec. 585.648 How will BOEM process my GAP?
(a) BOEM will review your submitted GAP, along with the information
and certifications you submitted in compliance with Sec. 585.646, to
determine if it contains the information necessary to conduct our
technical and environmental reviews.
(1) We will notify you if we deem your proposed facility or
combination of
[[Page 42760]]
facilities to be complex or significant; and
(2) We will notify you if your submitted GAP lacks any necessary
information.
(b) BOEM will prepare appropriate NEPA analysis.
(c) When appropriate, we will coordinate and consult with relevant
State and Federal agencies and affected federally recognized Indian
Tribes and provide to other local, State, and Federal agencies and
affected federally recognized Indian Tribes relevant nonproprietary
data and information pertaining to your proposed activities.
(d) During the review process, we may request additional
information if we determine that the information provided is not
sufficient to complete the review and approval process. If you fail to
provide the requested information, BOEM may disapprove your GAP.
(e) Upon completion of our technical and environmental reviews and
other reviews required by Federal law (e.g., CZMA), BOEM may approve,
disapprove, or approve your GAP with conditions.
(1) If we approve your GAP, we will specify terms and conditions to
be incorporated into your GAP. You must certify compliance with certain
of those terms and conditions, as required under 30 CFR 285.653(b); and
(2) If we disapprove your GAP, we will inform you of the reasons
and allow you an opportunity to submit a revised plan addressing our
concerns, and we may suspend your lease or grant, as appropriate, to
give you a reasonable amount of time to resubmit the GAP.
Sec. 585.649 [Reserved]
Activities Under an Approved GAP
Sec. 585.650 When may I begin conducting activities under my GAP?
After BOEM approves your GAP, you may begin conducting the approved
activities that do not involve a project easement or the construction
of facilities on the OCS that BOEM has deemed to be complex or
significant.
Sec. 585.651 When may I construct complex or significant OCS
facilities on my limited lease or any facilities on my project easement
proposed under my GAP?
If you are applying for a project easement or installing a facility
or a combination of facilities on your limited lease deemed by BOEM to
be complex or significant, as provided in Sec. 585.648(a)(1), you also
must comply with the requirements of 30 CFR part 285, subpart G, and
submit your safety management system description required by 30 CFR
285.810 before construction may begin.
Sec. 585.652 How long do I have to conduct activities under an
approved GAP?
After BOEM approves your GAP, you have:
(a) For a limited lease, the time period established under Sec.
585.236(a)(2), unless we renew the operations period under Sec. Sec.
585.425 through 585.429.
(b) For a ROW grant or RUE grant, the time provided in the terms of
the grant.
Sec. 585.653 What other reports or notices must I submit to BOEM
under my approved GAP?
You must prepare and submit to BOEM annually a report that
summarizes the findings from any activities you conduct under your
approved GAP and the results of those activities. BOEM will protect the
information from public disclosure as provided in Sec. 585.114.
Sec. 585.654 [Reserved]
Sec. 585.655 What activities require a revision to my GAP, and when
will BOEM approve the revision?
(a) You must notify BOEM in writing before conducting any
activities on the OCS not described in your approved GAP. Your notice
must describe in detail the type of activities you propose to conduct.
We will determine whether the activities you propose require a revision
to your GAP. We may request additional information from you, if
necessary, to make this determination. Upon receipt of your revised
GAP, BOEM will make a determination as to whether it deems the facility
or combination of facilities described in your revised GAP to be
complex or significant.
(1) If BOEM determines that your revised GAP is not complex or
significant, you may conduct your approved activities in accordance
with Sec. 585.650.
(2) If BOEM determines that your revised GAP is complex or
significant, then you must comply with the requirements of Sec.
585.651.
(b) BOEM will periodically review the activities conducted under an
approved GAP. The frequency and extent of the review will be based on
the significance of any changes in available information and on onshore
or offshore conditions affecting, or affected by, the activities
conducted under your GAP. If the review indicates that the GAP should
be revised to meet the requirement of this part, BOEM will require you
to submit the needed revisions.
(c) Activities for which a proposed revision to your GAP likely
will be necessary include:
(1) Activities on the OCS not described in your approved GAP that
could have significant environmental impacts or that may affect
threatened or endangered species, or that may affect designated
critical habitat of such species or that may result in incidental take
of marine mammals;
(2) Modifications to the number, size, or type of facilities
(including associated components) or equipment you will use outside of
the PDE that was approved for your project;
(3) Changes in the geographical location or layout of bottom
disturbances, offshore facilities, or onshore support bases beyond the
range of possible locations described in your approved GAP;
(4) Structural failure of any facility operated under your approved
GAP; or
(5) Change to any other activity specified by BOEM.
(d) We may begin the appropriate NEPA analysis and any relevant
consultations when we determine that a proposed revision could:
(1) Result in a significant change in the impacts previously
identified and evaluated;
(2) Require any additional Federal authorizations; or
(3) Involve activities not previously identified and evaluated that
could have significant environmental impacts or that may affect
threatened or endangered species, or that may affect designated
critical habitat of such species, or that may result in incidental take
of marine mammals.
(e) When you propose a revision, we may approve the revision if we
determine that the revision is:
(1) Designed not to cause undue harm or damage to natural
resources; life (including human and wildlife); property; the marine,
coastal, or human environment; or sites, structures, or objects of
historical or archaeological significance; and
(2) Otherwise consistent with the provisions of subsection 8(p) of
the OCS Lands Act.
Sec. 585.656 What must I do if I cease activities approved in my GAP
before the end of my term?
You must notify BOEM any time you cease activities under your
approved GAP without an approved suspension. If you cease activities
for an indefinite period that exceeds 6 months, BOEM may cancel your
lease or grant under Sec. 585.422, as applicable, and you must
initiate the decommissioning process, as set forth in 30 CFR part 285,
subpart I.
Sec. 585.657 What must I do upon completion of approved activities
under my GAP?
Upon completion of your approved activities under your GAP, you
must
[[Page 42761]]
decommission your project as set forth in 30 CFR part 285, subpart I.
You must submit your decommissioning application as provided in 30 CFR
285.905 and 285.906.
Cable and Pipeline Deviations
Sec. 585.658 Can my cable or pipeline construction deviate from my
approved COP or GAP?
(a) You must make every effort to ensure that all cables and
pipelines are constructed in a manner that minimizes deviations from
the approved plan under your lease or grant.
(b) If BOEM determines that a significant change in conditions has
occurred that would necessitate an adjustment to your ROW, RUE, or
lease before the commencement of construction of the cable or pipeline
on the grant or lease, BOEM will consider modifications to your ROW
grant, RUE grant, or your lease addendum for a project easement in
connection with your COP or GAP.
(c) If, after construction, it is determined that a deviation from
the approved plan has occurred, you must:
(1) Notify the operators of all leases (including mineral leases
issued under this subchapter) and holders of all ROW grants or RUE
grants (including all grants issued under this subchapter) which
include the area where a deviation has occurred and provide BOEM with
evidence of such notification;
(2) Relinquish any unused portion of your lease or grant; and
(3) Submit a revised plan for BOEM approval as necessary.
(d) Construction of a cable or pipeline that substantially deviates
from the approved plan may be grounds for cancellation of the lease or
grant.
Sec. 585.659-585.699 [Reserved]
Environmental Protection Requirements Under Approved Plans
Sec. 585.700 What requirements must I include in my SAP, COP, or GAP
regarding air quality?
(a) You must comply with the Clean Air Act (42 U.S.C. 7409) and its
implementing regulations in 40 CFR part 55, according to the following
table.
------------------------------------------------------------------------
If your project is located . . . You must . . .
------------------------------------------------------------------------
(1) In the Gulf of Mexico west of Include in your plan any
87.5[deg] west longitude (western Gulf information required for BOEM
of Mexico) or offshore of the North to make the appropriate air
Slope Borough of Alaska. quality determinations for
your project.
(2) Anywhere else on the OCS........... Follow the appropriate
implementing regulations as
promulgated by the EPA under
40 CFR part 55.
------------------------------------------------------------------------
(b) For air quality modeling that you perform in support of the
activities proposed in your plan, you should contact the appropriate
regulatory agency to establish a modeling protocol to ensure that the
agency's needs are met and that the meteorological files used are
acceptable before initiating the modeling work. In the western Gulf of
Mexico (west of 87.5[deg] west longitude) and offshore of the North
Slope Borough of Alaska, you must submit to BOEM three copies of the
modeling report and three sets of digital files as supporting
information. The digital files must contain the formatted
meteorological files used in the modeling runs, the model input file,
and the model output file.
Sec. 585.701 How must I conduct my approved activities to protect
marine mammals, threatened and endangered species, and designated
critical habitat?
(a) You must not conduct any activity under your lease or grant
that may affect threatened or endangered species or that may affect
designated critical habitat of such species until the appropriate level
of consultation is conducted, as required under the ESA, as amended (16
U.S.C. 1531 et seq.), to ensure that your actions are not likely to
jeopardize a threatened or endangered species and are not likely to
destroy or adversely modify designated critical habitat.
(b) You must not conduct any activity under your lease or grant
that is likely to result in an incidental taking of marine mammals
until the appropriate authorization has been issued under the Marine
Mammal Protection Act of 1972 (MMPA) as amended (16 U.S.C. 1361 et
seq.).
(c) If there is reason to believe that a threatened or endangered
species may be present while you conduct your BOEM-approved activities
or may be affected by the direct or indirect effects of your actions:
(1) You must notify us that endangered or threatened species may be
present in the vicinity of the lease or grant or may be affected by
your actions; and
(2) We will consult with appropriate State and Federal fish and
wildlife agencies and, after consultation, shall identify whether, and
under what conditions, you may proceed.
(d) If there is reason to believe that designated critical habitat
of a threatened or endangered species may be affected by the direct or
indirect effects of your BOEM-approved activities:
(1) You must notify us that designated critical habitat of a
threatened or endangered species in the vicinity of the lease or grant
may be affected by your actions; and
(2) We will consult with appropriate State and Federal fish and
wildlife agencies and, after consultation, shall identify whether, and
under what conditions, you may proceed.
(e) If there is reason to believe that marine mammals are likely to
be incidentally taken as a result of your proposed activities:
(1) You must agree to secure an authorization from National Oceanic
and Atmospheric Administration (NOAA) or the U.S. Fish and Wildlife
Service (FWS) for incidental taking, including taking by harassment,
that may result from your actions; and
(2) You must comply with all measures required by the NOAA or FWS,
including measures to affect the least practicable impact on such
species and their habitat and to ensure no immitigable adverse impact
on the availability of the species for subsistence use.
(f) Submit to us:
(1) Measures designed to avoid or minimize adverse effects and any
potential incidental take of the endangered or threatened species or
marine mammals;
(2) Measures designed to avoid likely adverse modification or
destruction of designated critical habitat of such endangered or
threatened species;
(3) Your agreement to monitor for the incidental take of the
species and adverse effects on the critical habitat, and provide the
results of the monitoring as required;
(4) Your agreement to perform any relevant terms and conditions of
the Incidental Take Statement that may result from the ESA
consultation; and
(5) Your agreement to perform any relevant mitigation measures
under an MMPA incidental take authorization.
[[Page 42762]]
Sec. 585.702 What must I do if I discover a potential archaeological
resource while conducting my approved activities?
(a) If you, your subcontractors, or any agent acting on your behalf
discovers a potential archaeological resource while conducting
construction activities, or any other activity related to your project,
you must:
(1) Immediately halt all seafloor-disturbing activities within the
area of the discovery;
(2) Notify BOEM of the discovery within 72 hours; and
(3) Keep the location of the discovery confidential and not take
any action that may adversely affect the archaeological resource until
we have made an evaluation and instructed you on how to proceed.
(b) We may require you to conduct additional investigations to
determine if the resource is eligible for listing in the National
Register of Historic Places under 36 CFR 60.4. We will do this if:
(1) The site has been impacted by your project activities; or
(2) Impacts to the site or to the area of potential effect cannot
be avoided.
(c) If investigations under paragraph (b) of this section indicate
that the resource is potentially eligible for listing in the National
Register of Historic Places, we will tell you how to protect the
resource, or how to mitigate adverse effects to the site.
(d) If we incur costs in protecting the resource, under section
110(g) of the NHPA, we may charge you reasonable costs for carrying out
preservation responsibilities under the OCS Lands Act.
Sec. 585.703 How must I conduct my approved activities to protect
essential fish habitats identified and described under the Magnuson-
Stevens Fishery Conservation and Management Act?
(a) If, during the conduct of your approved activities, BOEM finds
that essential fish habitat or habitat areas of particular concern may
be adversely affected by your activities, BOEM must consult with
National Marine Fisheries Service.
(b) Any conservation recommendations adopted by BOEM to avoid or
minimize adverse effects on essential fish habitat will be incorporated
as terms and conditions in the lease and must be adhered to by the
applicant. BOEM may require additional surveys to define boundaries and
avoidance distances.
(c) If required, BOEM will specify the survey methods and
instrumentations for conducting the biological survey and will specify
the contents of the biological report.
[FR Doc. 2024-08791 Filed 5-14-24; 8:45 am]
BILLING CODE 4340-98-P