Beveridge & Diamond

MMS Takes Steps to Approve Offshore Alternative Energy Projects

Beveridge & Diamond, P.C., January 16, 2008

The Minerals Management Service (“MMS”) has recently taken several steps toward approving the development of wind, wave and other alternative energy projects on the Outer Continental Shelf (“OCS”) beyond state waters. Congress provided this new authority to MMS in the Energy Policy Act of 2005.

On January 10, 2008, MMS issued a Record of Decision (ROD) on the OCS Alternative Energy and Alternative Use (AEAU) Program. The ROD is the last step in the review process for a comprehensive OCS AEAU Program. MMS issued the Final Programmatic Environmental Impact Statement (FPEIS) for the AEAU Program on November 5, 2007. The FPEIS analyzes the potential environmental impacts from the development, operation and decommissioning of alternative energy facilities on the OCS over the next five to seven years and outlines various policies, best management practices and mitigation measures that could be adopted for such a program. The ROD formally establishes MMS’s AEAU Program, and adopts 52 best management practices to minimize the potential adverse impacts of future alternative energy projects on the OCS. It also states the agency’s intent to issue programmatic regulations and acknowledges the agency’s authority to consider individual projects on a case-by-case basis before final regulations are completed. As part of this consideration, MMS may select one or more of the best management practices to be included as a mandatory provision in any individual lease or conveyance to be used for AEAU activities.

MMS Director Randall Luthi has stated that he expects MMS to issue proposed regulations governing leases, easements and rights-of-way for alternative energy projects on the OCS by Spring 2008, with final regulations to be issued by the end of the year. The rules will likely cover production, transportation and transmission of energy from sources such as wind, solar, wave and ocean current energy, as well as hydrogen production. 

In the meantime, future project developers can apply for short term leases to begin data collection on possible alternative energy sites. On November 5, 2007, MMS announced an interim policy for short term leases on the OCS.  The interim policy on Offshore Alternative Energy Resource Assessment and Technology Activities authorizes the installation of offshore data collection and technology testing facilities, such as meteorological towers, in federal waters.  MMS is currently accepting nominations for areas of the OCS proposed to be leased for meteorological or marine data collection facilities that will be used to assess alternative energy resources or test new technology. On December 14, 2007, MMS released a draft lease form, through which MMS would authorize and convey these short-term data collection and testing leases. Form MMS-0001, Lease of Submerged Lands for Alternative Energy Activities on the OCS, is available for public comment until February 12, 2008.

Finally, on January 11, 2008, the MMS filed a Draft Environmental Impact Statement (DEIS) for the controversial Cape Wind Energy Project with the Environmental Protection Agency. The project, proposed by Cape Wind Associates, LLC, requests a lease or other right-of-way to construct and operate 130, 3.6 megawatt, wind turbines generators in federal waters approximately 4.7 miles off the shore of Cape Cod, Massachusetts. The project proponents estimate that the wind farm could provide about 75 percent of the electricity for Cape Cod, as well as the islands of Martha’s Vineyard and Nantucket. MMS will be accepting comments on the DEIS from January 18, 2008 through March 20, 2008. Four public hearings will be held during the month of March.

For more information, please contact Peter Schaumberg ( or Angela Colamaria ( 

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