Onshore Renewables

Over the past decade, the federal government has taken steps to update regulations for renewable energy. These updates clarify and encourage planning for renewable energy development on federal lands, particularly for wind and solar energy.

BLM finalized a new rule (PDF) that promotes competitively offering designated solar and wind energy development leasing areas. Designated leasing areas have fewer environmental and cultural resource conflicts than others. Fewer conflicts make these areas better candidates for development.

BLM regulations allow for two distinct processes for awarding rights to apply to develop wind and solar energy projects on federal lands: one within designated leasing areas, and one outside of designated leasing areas.

Within designated leasing areas, BLM competitively offers leases for parcels of land for wind and solar energy development. Interested parties offer bids for the lease. BLM awards the lease to the highest bidder, so long as the payment is greater than or equal to the minimum bid (based on administrative costs incurred by the government and the estimated value of the land) and 20% of the bonus bid (any amount the bidder is willing to pay beyond the minimum bid). Some bidders may pre-qualify for offsets up to 20% of the high bid.

Outside of designated leasing areas, BLM offers right-of-way grants through a competitive process. BLM holds pre-application meetings and screens all applicants. Where there are two or more applicants (or at BLM’s discretion), BLM offers right-of-way grants by holding a competitive offer.

The highest bidder becomes the preferred applicant. Then the highest bidder is the only party that can apply for a right-of-way grant for a given parcel of land. BLM offers the applicant a grant at its discretion. There would be no bid offsets outside of the designated leasing areas. Subsequent site-specific National Environmental Policy Act (NEPA) analysis is required for right-of-way grants.

Companies explore leased land to locate suitable sites for constructing renewable infrastructure. BLM grants a developer a lease or right of way. Once granted, the developer has a period to construct facilities and begin generating electricity from wind or solar energy.

Once a developer submits a Plan of Development, they have a period to construct facilities and begin generating electricity from wind or solar energy. Within designated leasing areas, a developer has seven years to complete construction. Outside of designated leasing areas, a developer has two years. During this phase, the developer pays Megawatt Capacity fees for the energy produced. These fees are part of the rent to BLM.

At the close of a solar or wind project, developers must remove all facilities and return the land to a sound environmental state. Under the proposed rule, when an applicant gains a solar or wind energy lease or grant, they must provide BLM a bond. BLM holds the bond through the life of the project. The bond ensures compliance with terms and conditions, including site reclamation.