Order Code RL32658
CRS Report for Congress
Received through the CRS Web
Wind Energy:
Offshore Permitting
Updated January 25, 2006
Aaron M. Flynn
Legislative Attorney
American Law Division
Congressional Research Service ˜ The Library of Congress

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Wind Energy: Offshore Permitting
Summary
Technological advancements and tax incentives have driven a global expansion
in the development of renewable energy resources. Wind energy, in particular, is
now often cited as the fastest growing commercial energy source in the world.
Currently, all U.S. wind energy facilities are based on land; however, multiple
offshore projects have been proposed and are moving through the permitting process.
It is clear that the United States has the authority to permit and regulate offshore
wind energy development within the zones of the ocean under its jurisdiction. The
federal government and coastal states each have roles in the permitting process, the
extent of which depends on whether the project is located in state or federal waters.
Currently, no single federal agency has exclusive responsibility for permitting
activities on submerged lands in federal waters; authority is instead allocated among
various agencies based on the nature of the resource to be exploited and the type of
impacts incidental to such exploitation. Likewise, in the wind energy context, several
federal agencies will have a role to play in permitting development and operation
activities.
The Army Corps of Engineers (Corps) has exercised jurisdiction over proposed
offshore wind energy facilities under the Rivers and Harbors Act and the Outer
Continental Shelf Lands Act. This regulatory action was challenged in Alliance to
Protect Nantucket Sound v. United States Department of the Army. In that case, the
U.S. Court of Appeals for the First Circuit upheld the Corps’ authority to permit a
preliminary data collection tower in federal waters. The reasoning behind this
decision might have been applied to the permitting of larger-scale wind energy
projects, although arguments against an expansive reading of Corps authority
remained viable. To address these legal uncertainties, Congress passed section 388
of the Energy Policy Act of 2005 (H.R. 6, P.L. 109-58). This provision retains the
role played by the Corps in permitting under the Rivers and Harbors Act but grants
ultimate authority over offshore wind energy development to the Secretary of the
Interior. The provision also contains various exemptions from the regulatory regime
it establishes for projects that have received certain permits prior to the enactment of
the Energy Policy Act of 2005. Regulations implementing this new grant of statutory
authority are forthcoming and could bring additional and significant nuance to the
regulatory process.
This report will discuss the disputes over Corps jurisdiction prior to enactment
of the Energy Policy Act of 2005 as well as the current law applicable to siting
offshore wind facilities. This report will be updated as events warrant.

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Contents
Ocean Jurisdiction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
State Permitting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Federal Permitting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Early Regulation and Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
The Energy Policy Act of 2005 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2005 EPACT Exemptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Additional Regulation Under Existing Law . . . . . . . . . . . . . . . . . . . . . 12
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

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Wind Energy:
Offshore Permitting
Technological advancements and tax incentives have driven a global expansion
in the development of renewable energy resources. Wind energy, in particular, is
now often cited as the fastest growing commercial energy source in the world.1
Currently, unlike much of Europe,2 all wind power facilities in the United States are
based on land; however, multiple offshore projects have now been proposed,
including the Cape Wind project off the coast of Massachusetts; Winergy’s proposals
off the coasts of Massachusetts, New York, New Jersey, Delaware, Maryland, and
Virginia; and a Galveston-Offshore Wind, LLC project in a portion of the Gulf of
Mexico under the jurisdiction of Texas.3 These projects are relatively large
undertakings requiring substantial investment: proposed wind farms, consisting of
approximately 170 turbines off the coast of Massachusetts, for example, are
estimated to cost between $500 million and $700 million.4
There are multiple policy questions related to the feasibility and relative
attractiveness of developing wind energy. The focus of this report, however, is the
current law applicable to siting offshore wind facilities, including the interplay
between state and federal jurisdictional authorities. This report will also discuss the
court challenges to early federal offshore wind energy permitting authorities and the
effect that the enactment of the Energy Policy Act of 2005 will have on the regulatory
environment.
1 See MASS. TECH. COLLABORATIVE, U.S. DEP’T OF ENERGY, & GENERAL ELECTRIC, A
FRAMEWORK FOR OFFSHORE WIND ENERGY DEVELOPMENT IN THE UNITED STATES at 9
(Sept. 2005); U.S. DEP’T OF ENERGY & U.S. DEP’T OF THE INTERIOR, WHITE HOUSE REPORT
IN RESPONSE TO THE NATIONAL ENERGY POLICY RECOMMENDATIONS TO INCREASE
RENEWABLE ENERGY PRODUCTION ON FEDERAL LANDS at 6 (Aug. 2002).
2 For an overview of offshore wind farm regulation in the United Kingdom, see Nathanael
D. Hartland, The Wind and the Waves: Regulatory Uncertainty and Offshore Wind Power
in the United States and United Kingdom, 24 U. PA. J. INT’L ECON. L. 691 (2003).
3 Betsie Blumberg, Wind Farms: An Emerging Dilemma for East Coast National Parks, in
NATIONAL PARK SERVICE, NATURAL RESOURCE YEAR IN REVIEW — 2003 63 (March 2004);
see Texas General Land Office, Offshore Wind Energy (available at [http://www.glo.state.
tx.us/news/archive/2005/events/offshorewind.html]).
4 Testimony of Attorney General Thomas F. Reilly, Subcommittee on Energy and Mineral
Resources, Hearing Regarding H.R. 793, 108th Cong. (March 6, 2003) (available at
[http://resourcescommittee.house.gov/108cong/energy/2003mar06/reilly.htm]).

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Ocean Jurisdiction
The jurisdiction of coastal nations over the world’s oceans extends across
various adjoining and overlapping zones by operation of international conventions
and by the domestic laws and proclamations of individual governments. Jurisdiction
over U.S. waters is divided into four functional areas: the Territorial Sea, the
Contiguous Zone, the Exclusive Economic Zone, and state-controlled waters. The
federal government has differing levels of authority in each of these zones, vis-a-vis
the states and vis-a-vis other nations. Even within these U.S. zones, all nations enjoy
freedom of navigation and overflight as well as other internationally lawful uses of
the sea, subject to the regulatory jurisdiction granted to the coastal nation over such
things as setting optimum fishing allowances.5 It would, however, seem relatively
clear that, generally, the United States would have sufficient jurisdiction over each
of its zones to authorize the construction and operation of offshore wind projects.
U.S. authority as against other nations begins at its coast — called the baseline
— and extends 200 nautical miles out to sea. The first twelve nautical miles
comprise the U.S. territorial sea.6 Under the 1982 United Nations Convention on the
Law of the Sea7 (UNCLOS III), a coastal nation may claim sovereignty over the air
space, water, seabed, and subsoil within its territorial sea.8 U.S. Supreme Court
precedent and international practice indicate that this sovereignty authorizes coastal
nations to permit offshore development within their territorial seas.9
The U.S. contiguous zone extends beyond the territorial sea to twenty-four
nautical miles from the baseline. In this area, a coastal nation may regulate to protect
its territorial sea and to enforce its customs, fiscal, immigration, and sanitary laws.10
The exact contours of U.S. authority in the contiguous zone are not clearly defined,
although the United States does not claim full sovereignty.11 However, in addition
to the jurisdiction specifically applicable to the contiguous zone, the jurisdiction the
United States exercises over the EEZ also applies.
The U.S. EEZ extends 200 nautical miles from the baseline. In accordance with
international law, the United States has claimed sovereign rights to explore, exploit,
5 Restatement (Third) of the Foreign Relations Law of the United States, § 514 (1986).
6 Proc. No. 5928 (Dec. 27, 1988).
7 United Nations Convention on the Law of the Sea, Dec. 10, 1982, 21 I.L.M. 1261 (entered
into force Nov. 16, 1994)(hereinafter UNCLOS III).
8 UNCLOS III arts. 2.1, 2.2, 3; see also United States v. California, 332 U.S. 19 (1947);
Alabama v. Texas, 347 U.S. 272, 273-74 (1954).
9 See United States v. California, 436 U.S. 32, 36 (1978); United States v. Alaska, 422 U.S.
184, 199 (1975); Alabama v. Texas, 347 U.S. 272, 273-74 (1954); United States v.
California, 332 U.S. 19 (1947).
10 UNCLOS III art. 33.
11 United States v. De Leon, 270 F.3d 90, 91 n.1 (1st Cir. 2001); see also Vermilya-Brown
Co. v. Connell, 335 U.S. 377, 381 (1948); Cuban Am. Bar Ass’n v. Christopher, 43 F.3d
1412, 1425 (11th Cir.1995) (control and jurisdiction is not equivalent to sovereignty).

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conserve, and manage EEZ natural resources of the sea-bed, subsoil, and the
superadjacent waters.12 U.S. jurisdiction also extends over “other activities for the
economic exploitation and exploration of the zone, such as the production of energy
from the water, currents and winds”13 and, subject to some limitations, “the
establishment and use of artificial islands, installations and structures; marine
scientific research; and the protection and preservation of the marine environment.”14
In almost all situations, the U.S. EEZ overlaps geographically with the Outer
Continental Shelf (OCS), a geologically distinct area of appurtenant seabed
referenced in several federal laws.15
Thus, it would seem clear that as against other nations, the United States would
have legal authority to permit wind energy projects within the full range of its
territorial sea, contiguous zone, and EEZ.
The relative jurisdiction of the federal government and the states is also of
importance. The Submerged Lands Act of 195316 assured coastal states title to the
lands beneath coastal waters in an area stretching, in general, three geographical
miles from the shore.17 Thus states, subject to federal regulation for “commerce,
navigation, national defense, and international affairs” and the power of the federal
government to preempt state law, may regulate the coastal waters within this area.18
The remaining outer portions of waters over which the United States exercises
jurisdiction are federal waters.19
In sum, it would seem relatively clear that the U.S. federal government would
have permitting authority, supported by international law, for offshore wind farms.
However, federal authority would be limited by the internationally recognized right
of free passage and by the jurisdiction granted to the states under the Submerged
Lands Act. The attributes of existing permitting regimes at both the state and federal
level are, of course, limited by the confines of current law, discussed below.
12 UNCLOS III arts. 56, 58.
13 Id. art. 56.1 (emphasis added).
14 Id. art. 56.1(b).
15 See U.S. Commission on Ocean Policy, An Ocean Blueprint for the 21st Century: Final
Report of the U.S. Commission on Ocean Policy, Primer on Ocean Jurisdictions: Drawing
Lines in the Water, Pre-Publication Copy 41-44 (2004), available at
[http://www.oceancommission.gov/documents/prepub_report/primer.pdf].
16 43 U.S.C. §§ 1301-1303, 1311-1315.
17 Id. § 1301(a)(2). State jurisdiction typically extends three nautical miles (approximately
3.3 miles) seaward of the coast or “baseline.” Texas and the Gulf coast of Florida have
jurisdiction over an area extending 3 “marine leagues” (9 nautical miles) from the baseline.
43 U.S.C. § 1301(a)(2).
18 Id. §§ 1314(a), 1311(a)(2).
19 Id. § 1302.

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State Permitting
States may play a regulatory role whether a wind energy project is proposed for
construction in federal or state waters. State jurisdiction over projects located in
federal areas is substantially circumscribed; however, under the Coastal Zone
Management Act20 (CZMA), states are explicitly granted some regulatory authority.
In general, the CZMA encourages states to enact coastal zone management plans to
coordinate protection of habitats and resources in coastal waters.21 The act
establishes a policy of preservation alongside sustainable use and development
compatible with resource protection.22 Under the act, state coastal zone management
programs that are approved by the Secretary of Commerce receive federal monetary
and technical assistance. State programs must designate conservation measures and
permissible uses for land and water resources23 and must address various sources of
water pollution.24
Of particular importance here, the CZMA also requires that the federal
government and federally permitted activities comply with state programs.25
Responding to a Supreme Court decision that excluded OCS oil and gas leasing from
state review under the CZMA, Congress amended the “consistency review” provision
to include the impacts on a state coastal zone from federal actions in federal waters.26
Thus, states have some authority to assure themselves that federally-permitted
projects in federal waters will not result in a violation of state coastal zone
management regulation.
In addition to consistency review, projects to be constructed in state waters,
including any cables that would be necessary to transmit power back to shore, are
subject to all state regulation or permitting requirements. Coastal zone regulation
varies significantly among the states. The CZMA itself establishes three generally
acceptable frameworks: (1) “State establishment of criteria and standards for local
implementation, subject to administrative review and enforcement;” (2) “[d]irect
State land and water use planning and regulation;” and (3) regulation development
and implementation by local agencies, with state-level review of program decisions.27
20 16 U.S.C. §§ 1451-1464.
21 Coastal U.S. states and territories, including the Great Lakes states are eligible to receive
federal assistance for their coastal zone management programs. Currently, there are 33
approved state and territorial plans. Of eligible states, only Illinois does not have an
approved program. See National Oceanic and Atmospheric Administration, Office of Ocean
and Coastal Resource Management, State and Territory Coastal Management Program
Summaries, available at [http://www.ocrm.nos.noaa.gov/czm/czmsitelist.html].
22 Id. § 1452(1), (2).
23 Id. § 1455(d)(2), (9)-(12).
24 Id. § 1455(d)(16).
25 Id. § 1456(c).
26 Id; Sec’y of the Interior v. California, 464 U.S. 312, 315 (1984).
27 16 U.S.C. § 1455(d)(11).

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Within these frameworks, several states, such as New Jersey, California, and
Rhode Island, centralize authority for their programs in one agency.28 In New Jersey,
for instance, the state Department of Environmental Protection (through the Coastal
Management Office within the Commissioner’s Office of Policy, Planning, and
Science) is the lead agency for coastal zone management under several state laws.29
The majority of states, however, operate coastal zone management programs under
“networks” of parallel agencies, with various roles defined by policy guidance and
memoranda of understanding (MOUs).30 In Massachusetts, for instance, coastal zone
management is tended to by a variety of agencies, including the Departments of
Environmental Protection, Environmental Management, Fisheries and Wildlife, and
Food and Agriculture, as well as the Metropolitan District Commission, the Energy
Facilities Siting Board, and the Executive Office of Transportation and
Construction.31 Based on a series of MOUs, each agency is obligated to issue and
apply state regulations and permits consistently with the state’s coastal zone
management program.32 Thus, depending on the state with jurisdiction, offshore
wind energy projects can be subject to comprehensive regulation with permitting
authority located within multiple state and local level agencies.
Federal Permitting
For onshore wind projects on federal public lands, the Department of the
Interior (DOI), through the Bureau of Land Management, has created a regulatory
program under the Federal Land Policy and Management Act,33 but a federal statute
expressly governing offshore wind energy development was not enacted until August
2005 as part of the Energy Policy Act of 2005 (2005 EPACT). Before enactment of
the 2005 EPACT, some permitting in support of offshore wind energy development
had taken place under existing laws. Use of these authorities proved controversial
and was the subject of a lawsuit challenging preliminary permitting actions. The
previous regulatory regime, the conflicts it engendered, and the new 2005 EPACT
legal authority are discussed below.
Early Regulation and Litigation. Prior to enactment of the 2005 EPACT,
the Army Corp of Engineers (Corps) took the lead role in the federal offshore wind
energy permitting process, claiming jurisdiction under section 10 of the Rivers and
28 See Rusty Russell, Neither Out Far Nor In Deep: The Prospects for Utility-Scale Wind
Power in the Coastal Zone, 31 B.C. ENVTL. AFF. L. REV. 221, 240-41 (2004).
29 E.g., Freshwater Wetlands Protection Act N.J.S.A. 13:9B; Flood Hazard Area Control
Act, N.J.S.A. 58:16A; Wetlands Act of 1970, N.J.S.A. 13:9A; Waterfront Development
Act, N.J.S.A. 12:5-3; NJ Water Pollution Control Act - N.J.S.A. 58:10A; Coastal Area
Facility Review Act (CAFRA), N.J.S.A. 13:19; Tidelands Act, N.J.S.A. 12:3.
30 Rusty Russell, supra note 23, at 241.
31 MASSACHUSETTS OFFICE OF COASTAL ZONE MGMT., MASSACHUSETTS COASTAL ZONE
MANAGEMENT PLAN 113-121 (Mar. 2002), available at [http://www.state.ma.us/czm/
managementplan.pdf].
32 Id. at App. E.
33 43 U.S.C. §§ 1701 et seq.

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Harbors Act (RHA),34 as amended by the Outer Continental Shelf Lands Act
(OCSLA).35 Generally, the Corps has jurisdiction under these laws to permit
obstructions to navigation within the “navigable waters of the United States” and on
the Outer Continental Shelf.36
In addition to reviewing offshore construction for potential obstructions to
navigation, the Corps examined wind energy-related development pursuant to the
National Environmental Policy Act (NEPA), which generally requires analysis of the
environmental impacts of federal actions.37 Thus, pursuant to the RHA and NEPA,
the Corps may have examined most of the salient issues present in an offshore wind
energy proposal. Controversy arose, however, with respect to two primary issues that
were litigated in Alliance to Protect Nantucket Sound v. United States Department
of the Army.38 First, it was unclear whether Corps jurisdiction pursuant to the RHA
and the OCSLA extended to all offshore structures or only to those otherwise
permitted for energy or mineral development pursuant to other OCSLA provisions.
On the basis of the language of the statutes at issue, their legislative history, and
Corps regulations and guidance, a federal district court and the First Circuit Court of
34 33 U.S.C. §§ 407-687. Section 10 was enacted in 1899, and its text has not changed
substantively since that time. It states

The creation of any obstruction not affirmatively authorized by Congress, to the
navigable capacity of any of the waters of the United States is prohibited; and it
shall not be lawful to build or commence the building of any wharf, pier, dolphin,
boom, weir, breakwater, bulkhead, jetty, or other structures in any port,
roadstead, haven, harbor, canal, navigable river, or other water of the United
States, outside established harbor lines, or where no harbor lines have been
established, except on plans recommended by the Chief of Engineers and
authorized by the Secretary of the Army; and it shall not be lawful to excavate
or fill, or in any manner to alter or modify the course, location, condition, or
capacity of, any port, roadstead, haven, harbor, canal, lake, harbor or refuge, or
inclosure within the limits of any breakwater, or of the channel of any navigable
water of the United States, unless the work has been recommended by the Chief
of Engineers and authorized by the Secretary of the Army prior to beginning the
same. 33 U.S.C. § 403.
35 43 U.S.C. §§ 1331-1356a.
36 33 U.S.C. § 403. Corps regulations define the “navigable waters of the United States” as
“those waters that are subject to the ebb and flow of the tide and/or are presently used, or
have been used in the past, or may be susceptible for use to transport interstate or foreign
commerce.” 33 C.F.R. § 329.4. Under the RHA, navigable waters “includes only those
ocean and coastal waters that can be found up to three geographic miles seaward of the
coast.” Alliance To Protect Nantucket Sound, Inc. v. U.S. Dept. of Army, 288 F.Supp.2d
64, 72 (D.Mass.,2003) (hereinafter Alliance I), aff’d, 398 F.3d 105 (1st Cir. 2005)
(hereinafter Alliance II); see also 33 C.F.R. § 329.12(a). On the OCS, however, the Corps’
regulatory jurisdiction extends beyond that three-mile limit for, at least, certain purposes.
43 U.S.C. § 1333(a)(1), (e).
37 42 U.S.C. §§ 4321 et seq.
38 Alliance I, 288 F.Supp.2d at 64.

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Appeals held that the Corps is authorized to exercise RHA section 10 authority for
any offshore structure, regardless of purpose, in state or federal waters.39
The second issue in the Alliance case was whether a section 10 RHA permit was
sufficient to authorize the siting, construction, and operation of an offshore wind
energy facility. Use of federal and federally controlled lands, including the OCS,
requires some form of permission, such as a right-of-way, easement, or license.40
Thus, because any wind turbines would be attached to the seabed of the OCS, some
authorization to occupy the submerged lands of the OCS would be required before
construction could legally take place.41 Use or occupancy of the OCS without such
authorization arguably constitutes common law trespass.42 Questions over the type
of authorization a section 10 permit encompasses spring, in part, from Corps
regulations, which state the following:
A DA [Department of the Army] permit does not convey any property rights,
either in real estate or material, or any exclusive privileges. Furthermore, a DA
permit does not authorize any injury to property or invasion of rights or any
infringement of Federal, state or local laws or regulations. The applicant’s
signature on an application is an affirmation that the applicant possesses or will
possess the requisite property interest to undertake the activity proposed in the
application. The district engineer will not enter into disputes but will remind the
applicant of the above. The dispute over property ownership will not be a factor
in the Corps public interest decision.43
39 Id. at 75.
40 Several federal laws would appear to indicate that Congress intends the OCS to be used
only when permission has been expressly granted. See 43 U.S.C. § 1332(1), (3) (“the
subsoil and seabed of the outer Continental Shelf appertain to the United States and are
subject to its jurisdiction, control, and power of disposition ....”; see also 42 U.S.C. §
9101(a)(1)(stating that the purpose of the Ocean Thermal Energy Conversion Act is to
“authorize and regulate the construction, location, ownership, and operation of ocean
thermal energy conversion facilities.”).
41 See 43 U.S.C. § 1333(a)(2)(A) (applying the criminal and civil laws of states adjacent to
the OCS as federal law); see also Guy R. Martin, The World’s Largest Wind Energy Facility
in Nantucket Sound? Deficiencies in the Current Regulatory Process for Offshore Wind
Energy Development, 31 B.C. Envtl. Aff. L. Rev. 300, n.96 (2004).
42 The Court of Appeals for the Fifth Circuit has held that because the United States does
not own the OCS in fee simple, it cannot claim trespass based on unauthorized construction
on OCS. On the other hand, the court stated, “[n]either ownership nor possession is,
however, a necessary requisite for the granting of injunctive relief,” because the United
States has paramount rights to the OCS and an interest to protect. Thus damages available
under trespass may not be available for unauthorized construction on the OCS, while
injunctive relief would appear possible even under more constrained interpretations of U.S.
authority. United States v. Ray, 423 F.2d 16, 22 (5th Cir. 1970).
43 33 C.F.R. § 320.4(g)(6).

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Although issues tangentially related to OCS property interests were addressed
in the Alliance case, the reviewing courts left the matter substantially unsettled.44
Accordingly, prior to enactment of the EPACT 2005, it was unclear whether a Corps
permit was sufficient to authorize the use of the OCS for wind energy purposes.45
Congress has now approved legislation authorizing offshore wind energy project
permitting without completely abrogating the Corps’ authority under the RHA. This
new legal authority and how it relates to earlier law are discussed below.
The Energy Policy Act of 2005. Section 388 of the Energy Policy Act of
2005 seeks to address the issues raised in litigation related to offshore wind energy
development by specifically establishing legal authority for federal review and
approval of various offshore energy related projects. The provision amends the
OCSLA by adding a new subsection that authorizes the Secretary of the Interior, in
consultation with other federal agencies, to grant leases, easements, or rights-of-way
on the OCS for certain activities — wind energy development among them — not
authorized by other OCSLA provisions, the Deepwater Port Act, the Ocean Thermal
Energy Conversion Act, or “other applicable law.”46
44 See Alliance II, 398 F.3d 105, 114 (1st Cir. 2005). The courts did decide that the Corps
is not required to validate existing property rights or otherwise become involved in ongoing
property disputes prior to issuing a RHA permit. Alliance I, 288 F.Supp. 2d at 77-78.
Despite the Army Corps regulation, additional laws do require the Corps to consider
property rights in granting RHA permits. In determining if issuance of a RHA permit is in
the public interest, the Corps, under its own regulations, is obligated to consider the “effects
of the proposed work [i.e. offshore structure] on the outer continental rights of the United
States.” 33 C.F.R. § 320.4(f). In addressing this requirement in the Alliance case, the First
Circuit Court of Appeals held that the Corps satisfied this requirement with respect to the
preliminary data tower, stating: “[i]t is inconceivable to us that permission to erect a single,
temporary scientific device, like this, which gives the federal government information it
requires, could be an infringement on any federal property ownership interest in the OCS.”
Alliance II, 398 F.3d at 114.
45 Other energy-related offshore development, for instance, requires a lease issued by the
Department of the Interior (DOI), pursuant to the Outer Continental Shelf Lands Act
(OCSLA), prior to development. 43 U.S.C. § 1337.
46 43 U.S.C. § 1337(p)(1). DOI authority to grant leases, easements, or rights-of-way on the
OCS is contingent upon the permitted activities being consistent with the purposes specified
by the law. The relevant property interest may only be issued if the OCS activity will
(A) support exploration, development, production, or storage of oil or natural
gas, except that a lease, easement, or right-of-way shall not be granted in an area
in which oil and gas preleasing, leasing, and related activities are prohibited by
a moratorium;
(B) support transportation of oil or natural gas, excluding shipping activities;
(C) produce or support production, transportation, or transmission of energy from
sources other than oil and gas; or
(D) use, for energy-related purposes or for other authorized marine-related
purposes, facilities currently or previously used for activities authorized under
... [the OCLSA], except that any oil and gas energy-related uses shall not be
authorized in areas in which oil and gas preleasing, leasing, and related activities
are prohibited by a moratorium. 2005 EPACT, § 388(a), adding new 43 U.S.C.
(continued...)

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The new law also makes clear that federal agencies with permitting authority
under other federal laws retain their jurisdiction, despite enactment of this
subsection.47 Thus, the Corps, consistent with the Alliance case, will continue to
permit offshore development pursuant to the RHA, and other federal agencies with
jurisdiction over issues related to energy development, such as species impacts, will
be similarly unaffected. The law does not specify which agency will take the lead
role in coordinating federal permitting and responsibility for preparing NEPA
analysis. Arguably though, several provisions within section 388 of the 2005
EPACT indicate that DOI is charged with primary responsibility. The law now
directs the Secretary of the Interior to consult with other agencies as a part of its
leasing, easement, and right-of way granting process.48 The Department is also
responsible for ensuring that activities carried out pursuant to its new authority
provide for “coordination with relevant federal agencies ....”49 The precise division
of responsibilities, however, will depend upon the regulations that DOI eventually
issues and any memoranda of understanding negotiated by the stakeholders with
regard to relative roles in the permitting process. On December 30, 2005, the
Minerals Management Service, within the Department, issued an Advance Notice of
Proposed Rulemaking, seeking comments on the development of regulations to
implement section 388 and proposed regulations may be forthcoming.50
Although section 388 provides DOI with significant latitude in crafting a
regulatory regime for offshore wind energy development, the law does address
certain aspects of the property interest granting process expressly. First, the law
directs that leases, easements, and rights-of-way are, subject to some exceptions
described infra, pp. 11-12, to be issued on a competitive basis.51 The Secretary is
further authorized to provide for the duration of any property interest granted under
this subsection and to provide for suspension and cancellation of any lease, easement,
or right-of-way.52 The law also directs the Secretary to establish a system of
“royalties, fees, rentals, bonuses, or other payments” that will ensure a fair return to
the United States for any property interest granted under this provision.53 Beyond
this general guidance, however, the agency would seem to be free to determine what
constitutes a fair return and to require whatever form of payment it deems
appropriate.
The law also requires, with respect to royalties or other revenues, that the coastal
states affected by offshore development in an area extending three nautical miles into
46 (...continued)
§ 1337(p)(1)(A)-(D).
47 Id. § 1337(p)(9). For additional discussion, see infra pp. 12-16.
48 Id. § 1337(p)(1).
49 Id. § 1337(p)(4).
50 70 Fed. Reg. 77345 (Dec. 30, 2005).
51 43 U.S.C. § 1337(p)(3).
52 Id. § 1337(p)(5).
53 Id. § 1337(p)(2)(A).

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the OCS (as measured from the states’ offshore boundaries) are to receive 27 percent
of the revenues obtained by the federal government under this provision.54 More than
one state may be eligible to receive a portion of these revenues, depending upon the
location of a project.
The division of payments among states is to be based upon a formula that
equitably distributes revenues based on the proximity of the project to the affected
states’ offshore boundaries. The law establishes that states that have a “coastline that
is located within 15 miles of the geographic center of the project” may be entitled to
a revenue share.55 This may prove controversial in some instances to the extent that
there have not been determinative offshore boundaries between states. The Minerals
Management Service has recently prepared administrative boundaries for use in a
variety of circumstances, including the determination of “‘affected state’ status under
the Coastal Zone Management Act and the OCS Lands Act ...” and to help “define
appropriate consultation and information sharing with States.”56 The notice
informing the public that these boundaries have been established does not appear to
specifically state that they will be determinative in questions over revenue sharing
under section 388; however, these boundaries could form the basis for making
determinations as to proximity to state waters and, therefore, could affect the
distribution of revenues.
At this time, it is also unclear what will constitute a “partial” location of a
project in the zone designated under this law. For instance, it is quite likely that
transmission facilities from wind energy projects will be required to enter state
waters and, similarly, could cross into the royalty sharing zone as well, perhaps
constituting a partial location of a project within the three nautical mile area outlying
state controlled waters. However, as the transmission infrastructure may or may not
be permitted or otherwise approved under this new provision, it is unclear if the
presence of these facilities alone will entitle states to any royalty or revenue share.
These issues may be resolved in the forthcoming regulatory issuances but, at present,
must be deemed open questions.
In addition, the law appears to authorize considerable regulation of impacts
associated with offshore development by requiring the Secretary to ensure that “any
activity under this subsection” be carried out in a manner that adequately addresses
specified issues, including environmental protection, safety, protection of U.S.
national security, and protection of the rights of others to use the OCS and its
resources.57 In addition, specific financial security requirements are also established
54 Id. § 1337(p)(2)(B).
55 Id.
56 71 Fed. Reg. 127 (Jan. 3, 2006).
57 43 U.S.C. § 1337(p)(4). The Minerals Management Service also appears to have adopted
this interpretation, stating: “MMS interprets the authority granted in section 388(a) of the
Energy Policy Act of 2005 to issue leases, easements or rights-of-way as also providing
MMS authority to regulate or permit the activities that occur on those leases, easements or
rights-of-way, if those activities are energy related.” 70 Fed. Reg. 77345, 77346 (Dec. 30,
(continued...)

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by this subsection. The law requires the holder of a section 388 property interest to
“provide for the restoration of the lease, easement, or right-of-way” and to furnish a
surety bond or other form of security, leaving the amount and the exact purposes to
which any forfeited sums will be applied to the Secretary’s discretion.58 Further, in
conjunction with the authority to require some form of financial assurance, the
Secretary is empowered to impose “such other requirements as the Secretary
considers necessary to protect the interests of the public and the United States.”59
Thus, the Secretary, depending on how these authorities are exercised, may
potentially regulate many aspects of any industry that is permitted to operate on the
OCS under this subsection of the OCSLA.
The 2005 EPACT also contains a provision expressly providing for a state
consultative role in the permitting process. Section 388 requires the Secretary of the
Interior to provide for coordination and consultation with a state’s Governor or the
executive of any local government that may be affected by a lease, easement, or right-
of-way granted under this new authority.60 In addition, the law makes clear that it
does not affect any state’s claim to “jurisdiction over, or any right, title, or interest
in, any submerged lands.”61 Thus, states will remain primary in those areas
comprising state offshore waters, and should a state dispute the extent of its offshore
territory, such claims are unaffected by the Secretary’s new grant of authority under
this law.
2005 EPACT Exemptions. As described above, section 388 of the EPACT
2005 sets forth procedures for granting a lease, easement, or right-of-way in federal
waters when the property interest will be used for certain specified purposes,
including wind energy production.62 However, subsection (d) exempts certain actions
from specific section 388 requirements. This “savings provision” states that the law
does not require
the resubmittal of any document that was previously submitted or the
reauthorization of any action that was previously authorized with respect to a
project for which, before the date of enactment of this Act —
(1) an offshore test facility has been constructed; or
(2) a request for a proposal has been issued by a public authority.63
Thus, where a project has resulted from a public entity’s request for proposals
or where a project is associated with an existing offshore test facility, previously
submitted documents do not need to be resubmitted and previously authorized
57 (...continued)
2005).
58 43 U.S.C. § 1337(p)(6).
59 Id.
60 Id. § 1337(p)(7).
61 EPACT 2005, P.L. 109-58 § 388(e) (Aug. 8 2005).
62 Id.
63 Id. § 388(d).

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actions do not need to be reauthorized, essentially maintaining the status quo with
respect to these projects.64 This provision does not seem to exempt unauthorized
actions associated with the exempted actions, or, indeed, any other aspect of the
related project, from a requirement to comply with the property interest acquisition
provisions of section 388. Thus, siting and construction of an offshore data tower,
such as Cape Wind’s data tower in Nantucket Sound, would not have to be
reauthorized. However, any activity that had not been authorized before August 8,
2005, such as the construction of additional facilities, would appear to be subject to
the requirements of section 388.
An additional exemption is also contained in section 388. As stated, the law
contains a general requirement that a property interest issued under this provision be
granted on a “competitive basis.”65 Two exceptions are provided: a competitive
mechanism is not required if (1) the Secretary [of the Interior] determines that there
is no competitive interest, or (2) the project meets the criteria established by the
savings provision in subsection (d).66
The first exemption, requiring a finding of no competitive interest, is relatively
straight forward, although additional details may be provided at the administrative
level. The second exemption proves more complex in that it may apply more broadly
than the “savings” provision itself. As the text of the law indicates, “projects that
meet the criteria established under section 388(d)” are exempted from competitive
property interest acquisition.67 The “projects” referenced may not be limited to the
actions (such as a data tower constructed at the time of the 2005 EPACT’s
enactment) previously authorized. In fact, subsection (d) appears to use the term
“project” more broadly, such that a “project for which ... an offshore test facility has
been constructed ...” might encompass all future offshore development that would be
supported by, or is in some way related to, a qualifying test facility.68 What exactly
constitutes a “project” is, however, not precisely clear from the language of the
statute. It is also possible that a “project” for which a test facility has been
constructed could be interpreted more narrowly, such that the term “project” would
include only those actions authorized in conjunction with the test facility itself. In
short, because there is no definition provided for “project” in the law, it would seem
likely that the administering agency would be responsible for providing a definition
that is reasonably supportable by the law.
Additional Regulation Under Existing Law. In addition to the regulatory
regime authorized by section 388, it is also noteworthy that a variety of laws
preexisting the enactment of the 2005 EPACT remain applicable to offshore wind
energy development. Indeed, the 2005 EPACT makes clear that the enactment of
section 388 does not affect the jurisdiction, responsibility, or authority of any federal
64 Id.
65 43 U.S.C. § 1337(p)(3).
66 Id.
67 Id. (emphasis added).
68 EPACT 2005, P.L. 109-58 § 388(e) (Aug. 8 2005).

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or state agency operating under other federal law.69 Thus, it would seem clear that
the state role provided for by the CZMA and the Corps permitting authority provided
by the RHA, both described above, remain intact. Other federal laws that are likely
to be relevant in the permitting process are described below.
First, the Department of the Interior as well as any cooperating federal, state, or
local entities70 are required to undertake an environmental review process mandated
by the National Environmental Policy Act (NEPA).71 NEPA requires federal
agencies to take a “hard look” at the environmental consequences of their actions.
In general, NEPA and its implementing regulations require various levels of
environmental analysis depending on the circumstances and the type of federal action
contemplated. Certain actions that have been determined to have little or no
environmental effect are exempted from preparation of NEPA documents entirely
and are commonly referred to as “categorical exclusions.”72 In situations where a
categorical exclusion does not apply, an intermediate level of review, an
environmental assessment (EA), may be required. If, on the basis of the EA, the
agency finds that an action will not have a significant effect on the environment, the
agency issues a “finding of no significant impact” (FONSI), thus terminating the
NEPA review process. On the other hand, major federal actions that are found to
significantly affect the environment require the preparation of an environmental
impact statement (EIS), a document containing detailed analysis of the project as
proposed, as well as other options, including taking no action at all. NEPA does not
direct an agency to choose any particular course of action; the only purpose of an EIS
is to ensure that environmental consequences are considered. Thus, in practice,
NEPA review will likely provide information on wind energy projects, including
impacts to
existing resources of the final alternative sites in terms of physical oceanography
and geology; wildlife, avian, shellfish, finfish and benthic habitat; aesthetics,
cultural resources, socioeconomic conditions, and air and water quality. Human
uses such as boating and fishing will also be described.73
In addition to the role interested parties and cooperating agencies may play
under NEPA, certain federal agencies have independent sources of jurisdiction over
specific ocean resources. Thus, they would also likely be involved in the permitting
69 43 U.S.C. § 1337(p)(9).
70 These entities may request cooperating agency status pursuant to NEPA implementing
regulations and thereby contribute to the environmental analysis process.
71 42 U.S.C. §§ 4321 et. seq.
72 40 C.F.R. § 1508.4 (2003).
73 See U.S. ARMY CORPS OF ENG’RS, ENVIRONMENTAL IMPACT STATEMENT:
SCOPE OF WORK, WIND POWER FACILITY PROPOSED BY CAPE WIND
ASSOCIATES, LLC 3, available at [http://www.nae.usace.army.mil/
projects/ma/ccwf/windscope.pdf] (last visited Feb. 20, 2004). See also United States v.
Alaska, 503 U.S. 569, 579-80 (1992) (holding that Corps permitting decisions under section
10 are not limited to considerations of navigation).

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of offshore wind energy facilities. Some of the most relevant authorities are the
Endangered Species Act (ESA)74 and the Migratory Bird Treaty Act (MBTA).75
Briefly, each of these laws makes it illegal to inflict certain kinds of harm upon
designated species of plants and animals. The ESA prohibits any person, including
private entities, from “taking” a “listed” species.76 “Take” is broadly defined as “to
harass, harm, pursue, hunt, shoot, wound, kill, trap, capture or collect, or to attempt
to engage in any such conduct.”77 Additionally, a federal agency permitting or
undertaking action that could impact a protected species is subject to section 7 of the
ESA, which requires consultation with the U.S. Fish and Wildlife Service (FWS) or
the National Marine Fisheries Service (NMFS or NOAA Fisheries), depending upon
the species affected.78
The section 7 consultation process involves several initial steps leading to a
determination of whether a listed species or its designated critical habitat is present
in a project area.79 If a species or critical habitat is present, then the permitting/acting
74 16 U.S.C. §§ 1531-1544. It should also be noted that it is perhaps arguable that the ESA
does not apply in certain U.S. waters or extraterritorially. However, section 9, which
prohibits the taking of listed species, specifically states that it applies in the U.S. territorial
sea and upon the high seas (i.e. areas beyond national jurisdiction). 16 U.S.C. §
1538(a)(1)(A), (C). So far, all U.S. wind farm proposals have been within the boundaries
of the U.S. territorial sea and would thus appear to be covered by section 9. The section 7
consultation provision described above does not appear to expressly address applicability
in U.S. waters or extraterritorially; however, the law states that it applies, to “any action
authorized, funded, or carried out” by a federal agency, and regulations implementing
section 7 make clear that consultation is required for actions taken within the United States
and on the high seas. 16 U.S.C. § 1536; 50 C.F.R. § 402.01. The extent to which the
phrase “within the United States” includes portions of the ocean under U.S. sovereignty or
control is unclear; however, it may arguably include the territorial sea, over which the U.S.
exercises full sovereignty. The application of the ESA in areas under the jurisdiction of
other nations would be more questionable but is beyond the scope of this report. See Lujan
v. Defenders of Wildlife, 504 U.S. 555, 589 (1992) (Stevens, J., concurring). In addition
to ESA language pertaining to jurisdiction, the OCSLA does state that “[t]he Constitution
and laws and civil and political jurisdiction of the United States are hereby extended to the
subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all
installations ... to the same extent as if the outer Continental Shelf were an area of exclusive
Federal jurisdiction located within a State....,” lending credence to the idea that the ESA will
apply in U.S. waters. 43 U.S.C. § 1333(a)(1).
75 16 U.S.C. §§ 703-712.
76 Under the ESA, species are listed as either “endangered” or “threatened” based on the risk
of their extinction. An “endangered” species is “any species which is in danger of extinction
throughout all or a significant portion of its range ....” A “threatened” species is “any
species which is likely to become an endangered species within the foreseeable future
throughout all or a significant portion of its range.” 16 U.S.C. §§ 1532(6), (20).
77 16 U.S.C. § 1532(19).
78 Id. § 1536(2).
79 50 C.F.R. § 402.12(c) (2004). It should also be noted that some protections also attach
(continued...)

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federal agency must prepare a biological assessment, evaluating the potential effects
of the action.80 If the acting federal agency determines that a project may adversely
affect a listed species or critical habitat, formal consultation and preparation of a
biological opinion is required.81 The biological opinion contains a detailed analysis
of the effects of the agency action and contains the final determination as to whether
the proposed action is likely to jeopardize the species or destroy or adversely modify
its critical habitat.82 If review results in a jeopardy or adverse modification
determination, the biological opinion must identify any “reasonable and prudent
alternatives” that could allow the project to proceed.83 Projects that will result in a
level of injury to a species or habitat that will fall short of jeopardizing survival may
still be approved subject to certain terms.84 The agency may be allowed to “take”
some individuals of a listed species without triggering penalties under the act. These
incidental takings are to be described in a statement accompanying the biological
opinion.85 Takings allowed under the consultation process are deemed consistent
with the ESA; thus, they are not subject to penalties under the act, and no other
authorization or permit is required.86
The MBTA is the domestic law that implements U.S. obligations under separate
treaties with Canada, Japan, Mexico, and Russia for the protection of migratory
birds.87 The MBTA generally prohibits the taking, killing, possession, transportation,
and trafficking in of migratory birds, their eggs, parts, and nests.88 Like the ESA, the
general ban on taking protected birds can be waived under certain circumstances.
Pursuant to section 704, the Secretary of the Interior is authorized to determine if,
and by what means, the taking of migratory birds should be allowed.89 FWS is
responsible for permitting activities that would otherwise violate the MBTA. Its
regulations at 50 C.F.R. § 21 make exceptions from permitting requirements for
various purposes and provide for several specific types of permits, such as import and
79 (...continued)
to “candidate” species, i.e. those proposed but not officially listed. Under current law, an
agency must “confer” with the appropriate Secretary if agency action will likely jeopardize
the continued existence of any candidate species or adversely modify critical habitat
proposed for designation. This is distinct from the section 7 consultation process, less
formal, and meant to assist planning early in the process should the species be listed and
more definite protections attach. See 16 U.S.C. § 1536(a)(4); 50 C.F.R. § 402.10.
80 50 C.F.R. § 402.12(b), (d) (2004).
81 Id. § 402.14(e).
82 Id. § 402.14(h).
83 Id. § 402.14(h)(3).
84 Id. § 402.14(i).
85 Id. § 402.14(i)(1)(i)-(v).
86 16 U.S.C. § 1536(b)(4); 50 C.F.R. § 402.14(i)(5).
87 Birds that receive protection under the MBTA are listed at 50 C.F.R. 10.13 (2003).
88 16 U.S.C. § 703.
89 16 U.S.C. § 704.

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export permits, banding and marking permits, and scientific collection permits.90
More general permits for special uses are also provided for under the regulations,
although an applicant must make “a sufficient showing of benefit to the migratory
bird resource, important research reasons, reasons of human concern for individual
birds, or other compelling justification.”91
It would not appear that FWS has promulgated regulations specific to the sort
of unintentional harm caused by the rotating turbines of wind energy projects; thus,
it is not clear that the permitting process provided for under current regulations is
immediately applicable to wind energy projects.92 The Service has, however, adopted
voluntary, interim guidelines for minimizing the wildlife impacts from wind energy
turbines.93 As these guidelines indicate, compliance does not shield a company from
prosecution for MBTA violations; however, “the Office of Law Enforcement and
Department of Justice have used enforcement and prosecutorial discretion in the past
regarding individuals, companies, or agencies who have made good faith efforts to
avoid the take of migratory birds.”94
Conclusion
Interest in developing offshore wind energy resources continues to grow, and
projects are already in the initial stages of development. It would seem clear that the
United States, vis-a-vis other nations, would have the right to permit offshore
development in its territorial sea and on the Outer Continental Shelf, subject to state
authority over offshore areas under the Submerged Lands Act. The recently enacted
Energy Policy Act of 2005 provides the Department of the Interior with authority to
grant offshore property interests for the purpose of wind energy development and
appears to grant the Secretary of the Department the authority to regulate activities
resulting from such development. Additional laws preexisting the enactment of the
Energy Policy Act of 2005 continue in force and also appear likely to remain a source
of regulation, despite the apparent primary authority granted to the Department of the
Interior. Further, states also may claim a role in the permitting of offshore wind
energy development pursuant to authorities granted under existing federal law.
90 50 C.F.R. §§ 21.11-21.26 (2003).
91 Id. § 21.27.
92 See 69 Fed. Reg. 31074 (June 2, 2004) (“Current regulations authorize permits for take
of migratory birds for activities such as scientific research, education, and depredation
control. However, these regulations do not expressly address the issuance of permits for
incidental take.”).
93 U.S. Fish and Wildlife Service, Interim Guidelines to Avoid and Minimize Wildlife
Impacts from Wind Turbines, (May 2003) (available at [http://www.fws.gov/r9dhcbfa/
wind.pdf].
94 U.S. Fish and Wildlife Service, Memorandum, Service Interim Guidance on Avoiding and
Minimizing Wildlife Impacts from Wind Turbines at 2 (May 2003).

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