Wind Power Development on the United States Outer Continental Shelf: Balancing Efficient Development and Environmental Risks in the Shadow of the Ocsla
Sep 07 - Boston College Environmental Affairs Law Review
Abstract:
INTRODUCTION: THE DEMAND FOR WIND POWER DEVELOPMENT ON THE OUTER CONTINENTAL
SHELF (OCS)
We live in a world where fossil-fuel resources dwindle while demand for
energy steadily increases.1 The Organization for Economic Cooperation and
Development has warned that by 2020, the demand for fossil fuels will "sky
rocket" due to fast-paced economic growth in China, India, Russia, and
other nations.2 With such an increase in fossil-fuel use, carbon emissions could
double, causing "massive" pollution, shortages, and political
conflicts over increasingly scarce fuel resources.3 This looming energy crisis
has focused public attention on the development of other sources of clean,
affordable, and most importantly, renewable energy.4
As a result, public attention has come to rest on wind as an "abundant,
inexhaustible, and cheap" source of energy that some believe could provide
the foundation for powering the economies of the future.5 In fact, wind power is
now the fastest growing energy technology in the world.6 Globally, wind-powered
electricity generation increased by about 30 percent in 2001, and almost 500
percent overall since 1995.7 In 2002, approximately 50,000 wind turbines were in
operation around the world, including wind farms off the coasts of Great
Britain, Germany, Australia, and Sweden.8 Supporters claim that wind power could
also be successful in the United States because of its "large, untapped
wind potential."9 Wind power, however, generates less than one percent of
electricity in the United States,10 and no offshore wind farms exist in U.S.
waters.11
While fifty-four percent of the U.S. population resides in coastal states,
few viable onshore sites for large-scale wind development exist in these
areas.12 In order to bring alternative energy sources to this population,
developers are turning to offshore areas as prime targets for wind power
development.13 A number of sites are currently being considered by private
developers along the eastern seaboard, in both state and federal waters.14 The
federally controlled Outer Continental Shelf (OCS) has been specifically
targeted for private wind power development for two reasons: (1) it provides the
best source of shallow waters and sustainable winds,15 and (2) gaps currently
exist in federal legislation that would expedite development on the OCS,
enhancing the profitability of these projects.16
Because no offshore wind farms exist in waters of the United States, 17 the
process by which currently proposed projects obtain property rights from the
federal government will impact the viability of offshore wind farms as a major
source of alternative energy. Thus, the question of how private development of
the OCS for wind power generation should proceed is of paramount importance.
Part I of this Note describes the tensions between the environmental costs
and benefits of wind power development on the OCS. Part II gives a brief history
of private oil and gas development on the OCS, describing the federal statutory
policy of accelerating production over environmental concerns. It also focuses
on how the Outer Continental Shelf Lands Act (OCSLA)18 uses revenue and siting
as the primary methods of implementing this policy, and how concerns over the
OCSLA's failure to protect the environment led to a Congressional moratorium on
oil and gas leases on the OCS.
Part III highlights the current legislative gap that exists regarding wind
power development on the OCS and describes recently proposed legislation that
would amend the OCSLA to authorize use of the OCS by private corporations for
wind power development. Part IV introduces the theory that the stewardship
philosophy of the public trust doctrine could be emphasized in new legislation
as a means of moving national policy towards greater environmental protection of
public resources.
Finally, Part V of this Note argues that the current legislative gap
regarding alternative energy development on the OCS necessitates new legislation
before development occurs. It argues that the recently proposed legislation,
however, does not adequately change national policy to avoid the problems
encountered by the application of the OCSLA to oil and gas development. New
legislation should contain a stronger statement of the public trust philosophy
of environmental stewardship, provide specific limitations on the amount of the
OCS land that can be granted at one time, and use revenue payments to the
federal government as a means of encouraging private developers to mitigate
environmental risks.
I. ENVIRONMENTAL COSTS AND BENEFITS OF WIND POWER DEVELOPMENT ON THE OCS
A. Cape Wind Associates Proposal
The recent proposal by Cape Wind Associates, a private, for- profit
corporation based in Boston, Massachusetts is currently at the center of the
controversy surrounding the development of wind farms on the OCS. The waters off
the coast of Cape Cod, Massachusetts have some of the best-sustained winds and
shallowest depths in the country, making the area one of the most attractive
sites for offshore wind farm development. 19 Cape Wind is among the new
contenders for land on the OCS and plans to build the first offshore wind farm
in the United States there by 2005.20 As of January 2003, Cape Wind proposed to
install 130 tower-mounted turbines over twenty-five square miles of Nan tucket
Sound.21 The location is five miles off the coast of Cape Cod in an area known
as Horseshoe Shoal,22 and constitutes a portion of the federally owned OCS.23
B. Potential, Benefits
Cape Wind's proposal promises most of the environmental and economical
benefits characteristic of renewable energy production. Cape Wind predicts that
their wind farm would produce enough electricity, at peak output, to power more
than a half million homes, or an amount about equal to that required by Cape Cod
and the nearby Islands of Nantucket and Martha's Vineyard combined.24 On
average, the project could provide about three-quarters of this demand. 25 Cape
Wind claims that the electricity produced by their project would replace up to
113 million gallons of imported oil a year.26
The wind farm is said to generate "clean" electricity because,
unlike oil and gas, it will produce no harmful emissions, which could eliminate
up to 4642 tons of sulfur dioxide, 120 tons of carbon monoxide, 1566 tons of
nitrous oxides, over one million tons of greenhouse gases, and 448 tons of
participates from being released into the air.27 In addition, unlike oil or
coal, whose prices are volatile, the cost of wind is "forever free,"
and its supply is inexhaustible, which could help to reduce U.S. dependence on
conventional, increasingly scarce, energy sources and help stabilize energy
prices in the long term.28
C. Potential Risks to the OCS Environment
Some environmental and animal welfare groups oppose offshore wind power
facilities, arguing that turbines would in fact pose a significant risk to the
public resources of the OCS.29 Opponents of the Cape Wind project are primarily
concerned about the environmental impacts of turbine placement, construction,
and operation.30 The Cape Wind proposal would place tower-mounted turbines
approximately one-third to one-half mile apart in a grid- like pattern.31 Cape
Wind plans to mount the turbines on sixteen to twenty-one foot diameter monopole
foundations driven approximately eighty feet into the seabed.32 The maximum
height of each structure would be 417 feet above mean sea level, measured to the
tip of the turbine's blade.33 The proposal also provides for a platform that
would gather the generated electricity, and two underwater cables anchored to
the seabed that would transmit the power to the mainland.34
Nantucket Sound is a biologically rich and productive area, with an abundance
of birds, fish, sea turtles, and marine mammals.35 The Sound is also located
along an important avian migration route known as the Atlantic Flyway, which
attracts millions of birds per year.36 Up to 500,000 birds spend half the year
in the area, representing one of the largest concentrations of water birds on
the Atlantic Seaboard.37 Many of these birds, including a number of endanger\ed
species, depend on the area for nesting and foraging.38 Opponents predict that a
large number of towers concentrated on Horseshoe Shoal risk collisions, habitat
dislocation, and navigational disorientation due to tower illumination that
could dramatically reduce bird populations.39
Endangered and threatened sea turtles travel through Nantucket Sound as do
several species of whales, dolphins, porpoises, and seals.40 Some believe that
the magnetic fields created by the electric cables running from the turbines, as
well as underwater noises and vibrations, could interfere with the ability of
these species to navigate.41 The turbines' grid pattern may also prove difficult
for these species to maneuver through.42
Opponents further contend that the underwater support pilings and anchoring
devices supporting the turbines would alter the naturally open, sandy shoal
environment, creating artificial reefs inhospitable to indigenous species,
including commercially valuable squid, flounder, scup, mackerel, black sea bass,
and bluefish.43 The continued disturbance of the area during construction,
operation, servicing, and repair of the facilities may eventually lead to
habitat abandonment.44
II. OCS DEVELOPMENT: BACKGROUND AND POLICY
A. Background
The OCS consists of all submerged lands that lie seaward of the three-mile
United States territorial sea,45 and measures approximately 1.7 billion acres.46
The continental shelf is part of a geological feature known as the continental
margin, which begins at the shore as the continental shelf, later becomes the
continental slope, and finally ends as the continental rise extending seaward
towards the actual ocean floor, or abyssal plain.47 The seaward reach of the
continental shelf itself may extend from 1 mile up to 800 miles.48
1. The Roots of Federal Interest in the OCS
The discovery of oil on the OCS sparked a conflict between coastal states and
the federal government over ownership of the OCS and jurisdiction over its
development, primarily focusing on which entity should derive a propriety
interest in revenue from private developers.49 Historically, the federal
government had not questioned the coastal states' ownership of offshore
submerged lands up to the three-mile boundary50 demarcating the
"territorial sea."51 From 1842 to 1935 the United States Supreme Court
also upheld coastal states' ownership of the submerged lands beneath the
territorial sea.52
The build up to World War II awakened the federal government to the
importance of offshore petroleum deposits, but the war itself delayed federal
action to ensure the U.S. jurisdiction and control over the resources of
offshore submerged lands.53 On September 28, 1945, however, President Harry S.
Truman issued a Proclamation asserting this position.54 The Truman Proclamation
states in part:
Having concern for the urgency of conserving and prudently utilizing its
natural resources, the Government of the United States regards the natural
resources of the subsoil and seabed of the continental shelf beneath the high
seas but contiguous to the coasts of the Unites States as appertaining to the
United States, subject to its jurisdiction and control.55
Then, in 1947, the Supreme Court held in three separate cases that the
federal government exercises "paramount rights in and power over" all
offshore lands including the OCS and the three-mile territorial sea.56
2. The Submerged Lands Acts and the Outer Continental Shelf Lands Act of 1953
The Outer Continental Shelf Lands Act of 1953 (OCSLA),57 and its companion
statute, the Submerged Lands Act of 1953 (SLA)58 codified U.S. control over the
OCS. The SLA officially settled the jurisdictional conflict by establishing
coastal states' boundaries at the historical three-mile limit and recognizing
their exclusive interest in the resources within that boundary.59 The OCSLA
followed one month later, granting the federal government jurisdiction over all
submerged lands lying seaward of state coastal waters as defined by the SLA.60
section 1332 of the OCSLA states that "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."61 This is interpreted to
include all submerged lands lying outside the three-mile limit and extending
outward approximately 200 miles.62
The OCSLA also addressed the federal government's granting of leases for oil
and gas development on the OCS.63 The Act gave the Secretary of the Interior
broad discretion to promulgate regulations for leasing and developing the OCS
according to a four-phase regulatory process: (1) pr-leasing; (2) sale of
leases; (3) exploration by lessees; and (4) development and production of
mineral resources including oil and gas.64 Congress, however, later criticized
the OCSLA because it did not provide the secretary specific mandates for
carrying out these responsibilities.65
B. Federal Policy of Accelerated Oil and Gas Development Under OCSLA
The seabed of the OCS, as well as the overlying water and surrounding fish
and wildlife populations, are public resources.66 The most profitable offshore
resource, however, is petroleum, which was first discovered off Santa Barbara,
California in 1894.67 After 1953, the federal government increasingly viewed
these reserves as sources of wealth and national independence with the OCSLA as
a means to facilitate exploitation and allocation.68
1. Codifying the Federal Policy: The 1978 OCSLA Amendments
Under the OCSLA of 1953, the federal government leased portions of the OCS
under a closed system that was in effect controlled by oil companies and the
Secretary of the Interior.69 Nevertheless, little OCS development actually
occurred from 1953 to 1969, mostly due to the lack of technology necessary to
extract oil and gas from deeper waters.70 The Secretary also operated a
"tract selection" system, which limited the amount of land on the OCS
available for lease.71
The 1970s, however, brought a domestic energy shortage and a dramatic
expansion of the OCS leasing program.72 The catalyst for this expansion came in
1973 when the Arab oil embargo highlighted America's dependence on foreign
oil.73 This crisis prompted President Richard M. Nixon to announce "Project
Independence," which called for accelerated petroleum development on the
OCS.74 Coastal states and communities, as well as environmental and fishing
groups, opposed this acceleration and sued on a number of occasions to enjoin
the granting of certain leases.75 Congress responded to this public outcry by
amending the OCSLA in 1978 to address environmental concerns.76
Congress found that the country's demand for energy was growing, and would
continue to grow for the foreseeable future,77 and that this "increasing
reliance on imported oil [would be] . . . subject to significant reduction by
increasing the development of domestic sources of energy supply."78
President Jimmy Carter and others, however, emphasized the need for
"balanced resource development and the implementation of sound
environmental safeguards."79
In response to these conflicting priorities, Congress stated that the primary
purpose of the amendments was to expedite and facilitate OCS development
"in order to achieve national economic and energy policy goals, assure
national security, reduce dependence on foreign sources, and maintain a
favorable balance of payments in world trade."80 Congress found that
"there presently exists a variety of technological, economic,
environmental, administrative, and legal problems which tend to retard the
development of the oil and natural gas reserves of the Outer Continental
Shelf."81 Congress, however, also identified the OCS as "a vital
national resource reserve which must be carefully managed . . . to reflect the
public interest,"82 and emphasized that the newly adopted statutory regime
would protect the marine and coastal environments while "expedit[ing] the
systematic development of the OCS."83
The 1978 Amendments added section 18, which Congress believed increased the
Secretary's responsibility for undertaking the "rational management of the
oil and gas resources of the outer Continental Shelf."84 They instructed
the Secretary to determine the size, timing, and location of leases for
five-year periods and allowed the Secretary to "weigh environmental and
other risks against energy potential and other benefits in determining how,
when, and where oil and gas should be made available from the various outer
continental shelf areas to meet national energy needs."85 At the same time,
however, Congress believed that the public's interest was primarily in the
increased production of petroleum, and allowed the Secretary to suspend or
cancel leases only "when it [was] clear that the environmental risks or
damages of continued operations [would] place inequitable burdens . . . that are
not outweighed by the national benefits of producing the oil and gas."86
2. Implementing the Policy
The 1978 OCSLA Amendments facilitated a policy of accelerated development on
the OCS by revising the federal leasing system.87 Most importantly, the 1978
Amendments expanded section 8 of the OCSLA, which outlines the procedures for
granting oil, gas, sulfur, and other mineral leases and collecting royalties.88
As with the original version of the OCSLA, the amended statute also grants the
secretary broad discretion.89
a. Areawide Leasing
In the years immediately following the enactment of the 1978 Amendments, the
Secretary concluded that accelerated development necessitated a significant
increase in the amount of OCS acreage offered for lease.90 This led the
Secretary to implement an "areawide" program to lease OCS lands for
oil and gas exploration and production.91 Unlike the limited amounts of land
offered under the tract system that had been used since 1954, the areawide
system offered large planning areas for lease.92 The rationale behind thesystem
was to provide the petroleum industry with larger amounts of land, which would
give increased flexibility to locate and develop areas with the best potential
for oil and gas production.93
Areawide leasing was judicially approved in California v. Watt.94 The
petitioners in that case argued that the 1982 to 1987 areawide leasing program
developed by Secretary James Watt lacked the specificity required by section
18(a).95 This section requires the Secretary to develop "a schedule of
proposed lease sales indicating as precisely as possible the size, timing, and
location of leasing activity."96 The petitioners' claims voiced concerns
that the size and diversity of areawide lease sales hindered the ability of
coastal states and local governments to evaluate and plan for potential impacts
from oil and gas development.97 The court, however, rejected these arguments,
finding that the plain words of the statute required only as much specificity
"as possible," and that nothing in the OCSLA limited the size of lease
offerings as long as the Secretary identified the size of the offering to the
best of his knowledge.98
b. Revenue
Section 1337, as enacted in 1978, originally authorized the Secretary to
grant leases that stipulated various forms of cash bonuses, royalties, and
profit shares for the federal government.99 From 1954 to 1986, the federal
government leased forty-one million acres of the OCS for oil and gas
production.100 These leases proved to be very lucrative for the federal
government; as of 1992, revenue from the leasing and production of more than
20,000 oil and gas wells topped $87 billion.101 These funds were primarily
deposited into the federal treasury,102 limiting the financial benefits of
leases on the OCS to the federal government and private oil companies.103
Additionally, Congress later amended section 8 to allow lease revenue
payments under the OCSLA to be altered based on production.104 The Secretary may
"reduce or eliminate any royalty or net profit share set forth" in a
lease, "in order to promote increased production on the lease
area."105 The section specifically allows royalty and net-profit-share
reductions and eliminations "[i]n the Western and Central Planning Areas of
the Gulf of Mexico and [in a] portion of the Eastern Planning Area of the Gulf
of Mexico," in order to: "(i) promote development or increased
production on producing or non-producing leases; or (ii) encourage production of
marginal resources on producing or non-producing leases."106
C. Backlash Against Development
The environmental risks of offshore petroleum development were brought to the
nation's attention in 1969 when a drilling facility on the OCS off the coast of
Santa Barbara, California caused an oil spill that severely damaged the ecology
of the Santa Barbara Channel.107 As a result, environmental organizations and
other concerned groups, like those representing commercial and recreational
fishing interests, began to express stronger concern about the accelerated
development policy called for by Nixon's Project Independence.108 In 1975,
thirteen Atlantic coastal states filed suit against the United States in United
States v. Maine, claiming ownership of the entire OCS off their shores, as well
as its resources.109 While the Supreme Court rejected this claim,110 the suit
framed the debate over the federal government's new policy of accelerated
development.111 States and communities also filed a number of lawsuits in direct
response to proposed leases under the secretary's accelerated schedule.112
Congress found that the 1978 Amendments provided an approach that would
successfully balance accelerated development and environmental protection.113
Some environmental groups and coastal states, however, believe that the federal
government's policy has consistently been to allow the oil industry to develop
the OCS regardless of state and environmental concerns.114 Instead, the federal
government has prioritized its aggressive pro-development policy on the OCS for
financial and national security reasons, making real environmental concerns play
"second fiddle."115 Despite the secretary's explicit responsibility
under the OCSLA,116 the manner in which the Secretary balances economic versus
environmental concerns is virtually unassailable because under section 19(d) of
the Act,117 his decisions are subject only to arbitrary and capricious
review.118
The Reagan administration continued the accelerated development program
described above, despite extensive criticism from environmental groups and
coastal states, alleging that such policy constituted "nothing more than a
'fire sale' and giveaway of the nation's resources."119 A large number of
lease sales were challenged, resulting in a wave of litigation that questioned
the secretary's ability to adequately assess environmental risks for areawide
leases and asserted that the government was not receiving a fair market value
for public resources.120 These pressures ultimately led Congress to impose
leasing moratoria on certain areas of the OCS.121 The Bush administration later
withdrew 610 million acres, a majority of the OCS, from development.122 The
Clinton administration followed, extending the moratoria until 2012.123
III. The Wind Power Legislative Gap and the Proposed Amendment to the OCSLA
A. The Wind Power Legislative Gap
Like oil and gas development on the OCS, Cape Wind Associates's proposal has
met with opposition from a variety of groups.124 While these groups are
ultimately concerned about the potential environmental, economic, and aesthetic
impacts125 that the project could pose for the region, the legal debate centers
on the absence of legislation authorizing the federal government to lease
portions of the OCS to private parties for wind power development.126
On August 19, 2002, the U.S. Army Corps of Engineers (Corps) authorized Cape
Wind to build a data collection tower on the site of their proposed wind
farm.127 The Corps claims authority to issue the permit under section 10 of the
River and Harbor Appropriations Act of 1899 (RHA), which authorizes the Corps to
issue permits for the installation of structures in or over navigable waters,128
and subsections 1333(a) and 1333(e) of the OCSLA which extend Corps jurisdiction
under the RHA to "all installations and other devices permanently or
temporarily attached to the seabed, which may be erected thereon for the purpose
of exploring for, developing or producing resources therefrom, or any such
installation or other device (other than a ship or vessel) for the purpose of
transporting such resources."129 Corps regulations governing the section 10
permitting process require that the applicant confirm that property rights have
been, or will be, obtained from the federal government.130
The OCLSA explicitly grants the Secretary authority to issue leases to
private parties only for the "exploration,"131
"development,"132 and "production"133 of
"minerals"134 on the OCS.135 There is no provision for the development
of alternative energy resources.136 In fact, no legislation explicitly governs
the use of land on the OCS for many alternative energy projects.137
A strict reading of subsections 1333(a) and 1333(e) of the OCSLA suggests
that the Corps is not authorized to issue permits for wind farm development on
the OCS, because such projects do not develop or produce the resources of the
OCS within the meaning of the statute.138 Wind farm opponents argue that, even
though wind turbines would constitute installations permanently attached to the
seabed, they would not explore, develop, remove, or transport subsoil and seabed
resources within even a broad reading of the OCSLA.139 In Guess v. Read, the
court supported this interpretation, stating that "[t]he Continental Shelf
Act was enacted for the purpose primarily of asserting ownership of, and
jurisdiction over minerals in and under the Continental Shelf."140
Some claim that because the OCSLA does not clarify the meaning of the term
"resource," the definition of "natural resources" found in
its companion statute, the SLA, should be used to extend the permitting
authority of the Corps to development of additional OCS resources.141 The SLA
defines "natural resources" as, "including without limiting the
generality thereof, oil, gas, and all other minerals and fish, . . . and other
marine animal and plant life" 142 In the OCSLA, however, the term
"resource" is used independently only in asserting that the OCS is a
"vital national resource reserve held by the Federal Government for the
public."143 Arguably then, the OCSLA should not apply, and the Corps does
not have jurisdiction to permit a wind power generation facility on the OCS.144
Nevertheless, in the District Court of Massachusetts disagreed, finding that
Congress intended subsections 1333(e) to apply to all artificial islands and
fixed structures on the OCS regardless of their purpose and therefore giving the
Corps broad jurisdiction.145 The court also read subsection 1333 (a) as applying
to "all artificial islands, and all installations. . ., which may be
erected. . .for the purpose of exploring for, developing, or producing resources
therefrom."146 The court therefore found the Corps issuance of the Cape
Wind permit reasonable.147
B. Proposed Legislation
Regardless of the District Court of Massachusetts's ruling in Alliance to
Protect Nantucket Sound v. U.S. Dep't of the Army, some federal legislators
recognize that current legislation is insufficient to authorize proposed wind
power facilities.148 These legislators seek to amend the OCSLA further in order
to explicitly authorize the conveyance of easements and rights-of-way on the OCS
for renewable energy development.149 On February 13, 2002, congressional
Representative Barbara Cubin (R. Wyoming), introduced H.R. 793, a bill that
would amend the OCSLA in order to expand the secretary's jurisdiction to include
offshore renew\able energy projects.150
Foremost among the purposes of the bill is to "protect the economic and
land use interests of the Federal Government" in the management of OCS
lands for non-oil and gas related energy projects.151 Other purposes include
"expedit[ing] projects to increase the production, transmission, or
conservation of energy on the Outer Continental Shelf,"152 and ensuring
that the federal government receives a "fair return" for easements or
rights-of- way.153
The Amendment broadly authorizes the secretary to "grant an easement or
right-of-way on the outer Continental Shelf for activities not other wise
authorized in this Act."154 The secretary "shall [also] prescribe any
necessary regulations to assure safety, protection of the environment,
prevention of waste, and conservation of natural resources of the outer
Continental Shelf, protection of national security interests, and the protection
of correlative rights therein."155 To accomplish this, the secretary is
directed to consult with "relevant departments and agencies of the Federal
Government and affected states."156
In order to ensure a "fair return" for the federal government, the
proposed amendment directs the secretary to "[e]stablish reasonable forms
of annual or one-time payments for any easement or right-ofway."157
Nevertheless, the "payments shall not be assessed on the basis of
throughput or production."158 The Secretary "may establish fees,
rental, bonus, or other payments by rule or by agreement with the party to whom
the easement or right-of-way is granted."159
IV. THE OCS AND THE PUBLIC TRUST'S ENVIRONMENTAL ETHIC
Since Joseph L. Sax published his landmark article, The Public Trust Doctrine
in Natural Resource Law: Effective Judicial Intervention in 1970, the public
trust doctrine and its philosophy of environmental stewardship has been gaining
influence in American law.160 The public trust doctrine, as applied to modern
environmental problems, is best understood as a fundamental duty on the part of
government to maintain a regenerative natural environment for the benefit of
present and future generations.161 This duty is founded on the philosophy that
present generations have a responsibility "to preserve the environment and
its inhabitants" and to thereby "provide future generations with a
clean and healthy environment."162
In Marks v. Whitney, the California Supreme Court held that the public trust
does not just protect public uses of the land, but also encompasses the
preservation of "lands in their natural states, so that they may serve as
ecological units for scientific study, as open space, and as environments which
provide food and habitat for birds and marine life, and which favorably affect
the scenery and climate of the area."163 One author identifies this
philosophy as "duty based environ men talism," which has also been
labeled as the "stewardship ethic."164
A. The Federal Government's Public Trust Responsibility Regarding the Public
Lands of the OCS
The federal government's public trust responsibility stems from its authority
to manage federal public lands.165 This authority is granted by the Property
Clause of the United States Constitution, which provides that "[t]he
Congress shall have Power to dispose of and make all needful Rules and
Regulations respecting the Territory or other Property belonging to the United
States."166
The public trust doctrine developed primarily as state law.167 Although the
issue remains undecided by the United States Supreme Court, the majority of
federal courts of appeals have held that the public trust doctrine also applies
to the United States.168 Accordingly, the federal government may be called upon
to implement the public trust as "the guardian of the people of the United
States over the public lands."169 Under this theory, the federal government
has a public trust obligation to manage private use of federal public lands.170
B. Incorporating Public Trust Principles into Public Land Legislation
Congress delegates its responsibility for administering public lands to a
number of federal agencies by statute.171 Expanding this responsibility,
Congress began to enact statutes in the 1970s that gave these agencies the power
to protect federal public lands and resources as public trust property.172 The
philosophy of the public trust (the protection and preservation of natural
resources for present and future generations) has been used at the federal level
as the policy underlying the statutory protection of public lands and
resources.173 Because it is within Congress's authority to determine whether the
public trust should be modified or extinguished,174 it is argued that some
federal statutes protecting public resources actually codify the basic tenets of
the public trust.175
Some believe that the public trust needs to take a more important role in
environmental legislation and policy decisions.176 They posit that the public
trust should
[infuse] the law with a sense of the government's overarching sovereign duty
to protect the environmental rights of citizen beneficiaries from the
exploitative tendencies of the beneficiaries themselves. Access rights must be
secondary. The duty of this generation to future generations must be the key
ingredient of an effective modern public trust.177
According to one commentator, two different philosophies provide the basis
for statutes that seek to balance development and environmental protection.178
One is "environmentally conscious utilitarianism," which treats the
environment as "an entity that must be managed in order to maximize its
productivity."179 The other is "duty based environ men talism,"
which mirrors the public trust philosophy that the present generation owes
future generations a duty "to preserve the environment and its
inhabitants."180
V. ANALYSIS
A. The Conflicting Goals of OCS Wind Power Development
The conflicting goals of the 1978 OCSLA amendments still ring true today. In
1978, environmental concerns stemming from incidents like the Santa Barbara oil
spill competed with growing fears about U.S. dependence on foreign energy
supplies.181 Today, meeting the United States's ever-increasing energy needs
while reducing dependence on foreign energy sources and protecting national
security remain top priorities.182 Concerns about global warming and dwindling
natural resources, however, have now shifted national attention away from oil
and gas, and towards renewable energy sources.183
Offshore wind power development could comprise part of the solution to these
problems. One of the most important benefits of wind power development is its
potential to minimize pollution.184 Furthermore, unlike finite oil and gas
reserves, wind is an unlimited resource.185 Therefore, the effect of wind farms
on U.S. energy generation could be revolutionary.
Unfortunately, no known means of energy production is without
externalities.186 The revolutionary prospects of wind power development on the
OCS are paired with environmental risks, even if these risks are significantly
less dramatic than those created by oil and gas extraction.187 The submerged
lands of the OCS, as well as the water and the sky above, are home to many
species.188 Portions of these areas also function like highways for migrating
species, including birds.189 The construction, operation, and maintenance of
thousands of turbines the size of office buildings will affect these
environments.190
Wind power developers like Cape Wind claim that these externalities can be
mitigated, but the process is costly and time- consuming.191 Developers
emphasize that the United States need for energy independence and the world's
need for clean, renewable energy means that projects like Cape Wind's should be
expedited.192 They believe that the overall benefits of renewable energy
production outweigh what they see as minimal potential environmental costs.193
In contrast, some, including Massachusetts Attorney General Tom Reilly, have
asserted that the environmental risks to the OCS cannot be ignored simply
because the broader environmental and economic benefits of renewable energy are
so great in comparison.194 Reilly has recommended that a moratorium be placed on
wind farm development until regulations are promulgated setting safeguards in
place to ensure that the fragile ocean environment will be protected with
comprehensive legislation.195
B. The Need for New Legislation and a New National Policy on Wind Power
Development
There is a strong case that the OCSLA, in its present form, does not
authorize the use of the OCS for private wind power generation projects.196
Assuming that the OCSLA does not apply, no mechanisms currently exist by which a
private party can gain the right from the federal government to use the OCS for
wind power development.197 Additionally, there is no federal agency that has
been delegated the duty to protect the public interest in the OCS as related to
wind power generation and to manage such activities to ensure that that they are
safe and environmentally sound.198 If wind farm development proceeds, this
regulatory gap leaves the OCS unprotected, and wind power opponents fear
"an Oklahoma land grab."199
Congress has recognized that "the outer Continental Shelf is a vital
national resource reserve held by the Federal Government for the
public."200 This vital national resource should not be given away without a
reevaluation of public policy that takes into consideration the failure of the
OCSLA to balance development with environmental protection.
1. Problems with the National Policy Under the OCSLA
The history surrounding legislative authorization of oil and gas development
on the OCS suggests that the federal government has prioritized expedited
development over environmental protection in the face of energy crisis.201
During these periods, the federal government was motivated by national security
concerns and the promise of substantial revenue.202
\The Truman Proclamation first set the tone for what may be seen as the
federal government's unabashedly pro-development policy for the OCS.203 Truman's
words emphasize that from the time the federal government first realized the
value of the OCS, its priority has consistently been to exploit its
resources.204 The proclamation states in part that the federal government has
"concern for the urgency of conserving and prudently utilizing its natural
resources."205 Later, Congress officially adopted a legislative policy of
"swift, orderly, and efficient exploitation"206 of oil and gas
reserves on the OCS by enacting, and later amending, the OCSLA.207
The 1978 Amendments were supposed to balance expedited development with
environmental safeguards.208 Congress hoped that the newly adopted OCS leasing
process would facilitate and expedite development while also protecting the
marine and coastal environments.209 The Amendments, however, did not make
meaningful balancing possible because environmental risks are assigned less
weight in the balancing process, and Congress made the Secretary's
responsibility to protect the OCS environment secondary to the furtherance of
its development. The Amendments state that "expeditious and orderly
development" should be "subject to environmental safeguards."210
If, however, the Secretary finds that there are "inequitable"
environmental risks, the development process should be halted only when they are
so severe that they "are not outweighed by the national benefits of
producing the oil and gas."211
This pro-development balancing process was bolstered by the OCSLA leasing
process itself.212 The controversial areawide leasing scheme hindered effective
environmental analysis because the lease areas were so large.213 Coastal states
and local governments found that identifying impacts was impossible without
knowledge of the specific development sites.214 Congress also used revenue
reduction as a tool to encourage exploration and development in what it
considered to be under utilized areas,215 but this too was criticized as a
virtual give away of public resources to private companies.216 Coastal states,
local governments, and other groups were not willing to allow such a process to
continue and legal battles raged.217 In the end, the failure of federal policy
to effectively balance these competing priorities ultimately led Congress to
halt lease sales in most areas of the OCS.218
2. Problems with Proposed Legislation to Amend the OCSLA
In 2003, congressional Representative Barbara Cnbin (R. Wyoming) introduced
legislation in the House of Representatives that would amend section 8 of the
OCSLA to include wind power development.219 The bill presents some positive
steps toward remedying the problems encountered with oil and gas leasing
procedure under the OCSLA, but it fails to adequately shift national policy away
from the strict environmental utilitarianism that ultimately led to leasing
moratoria.220
The proposed amendment does not go far enough in making any real change to
federal policy for the OCS. It maintains expedited development as its primary
goal.221 The bill also delegates too much discretion to the Secretary in
balancing the benefits of development with the environmental risks.222 In fact,
while the Secretary has discretion in granting easements and rights-of-way, the
bill does not mandate the Secretary to undergo environmental balancing at
all.223 The Secretary must prescribe "necessary regulations to assure
safety, protection of the environment, prevention of waste, and conservation of
the natural resources of the outer Continental Shelf, protection of national
security interests, and the protection of correlative rights therein."224
An actual consideration of environmental factors, however, is only mandated when
the Secretary determines whether the property right shall be granted
competitively or noncompetitively.225
Further, Representative Cubin's bill allows the Secretary discretion as to
the amount of OCS land that can be granted at one time, and as to the method of
determining payment amounts.226 The bill does not address the amount issue at
all, presumably leaving the question open to the discretion of the Secretary,
whose decision would probably be supported under California v. Watt (Watt
II).227 It does establish, however, that "payments shall not be assessed on
the basis of throughput or production."228 This provision contrasts with
section 8 of the OCSLA, which permits the reduction or elimination of payments
on oil and gas leases in order to promote increased development or
production.229
C. How Should the OCSLA Be Amended?
It is clear that wind power facilities do not pose the same catastrophic
risks to the OCS environment as oil and gas development.230 Nevertheless, the
environmental impact should not be ignored. If the more than twenty proposed
wind farms succeed in placing 3000 or more turbines in what was open seabed,
water, and air, an adverse environmental impact of some degree is certain.231
The extent of the opposition surrounding the Cape Wind proposal demonstrates
that despite the revolutionary importance of large scale renewable energy
developments, public opinion demands that environmental risks not be ignored in
the rush to capitalize on a promising new energy source.232 Therefore, the
substantive goals and the procedures of new legislation authorizing and guiding
wind farm development on the OCS should encourage development and keep wind
farms profitable-but not at the expense of the environment.
Massachusetts Attorney General Thomas Reilly has suggested that new
legislation needs:
[A] mechanism for identifying-in advance-appropriate sites for developing
offshore wind power facilities that provide the greatest source of energy with
the least damage to the environment and do not pillage our most treasured
natural resources; a process for soliciting competing proposals for renewable
energy facilities in the same locations; compensation to the government for the
value of the license; and meaningful state input throughout the process.233
This Note expands upon these recommendations and suggests that the
requirements for new legislation should include the following: (1) a stronger
statement of the public trust philosophy; (2) specific limits on the discretion
of the secretary regarding the amount of OCS land that can be granted at one
time; and (3) the use of revenue requirements as an incentive for mitigating
environmental risks.
1. Role of Public Trust Philosophy
One author has stated that "environmental long-range problems could be
discovered and resolved if our populations develop an interest or ethic in
correcting this situation."234 Law is often considered to be the means by
which society establishes and communicates its own values.235 In this way,
"[l]aw sometimes may actually leap ahead of society, anticipating and
setting new values and new standards of conduct."236
Opposition to development on the OCS, whether oil, gas, or wind, is partially
rooted in the public trust philosophy, described in Part IV as the duty of
present generations to protect and preserve natural resources for present and
future generations.237 This ethic recognizes that our world is made up of many
ecosystems with varying degrees of fragility and vulnerability, which are
equally worthy of protection.238 This philosophy takes a duty-based approach to
environmental management.239 Legislation authorizing wind power generation
facilities on the OCS should codify this aspect of the public trust by weighing
environmental impacts equally against broader environmental benefits, energy
demand, and national security. While OCS wind power development should, and
probably would, continue under such a standard, it is important to the future
success of this energy source that legislative environmental priorities not be
questioned as they were for oil and gas leases under the OCSLA.240
2. Role of Siting and Revenue in Implementing New Policy
The OCS wind power development process should be structured as a means of
ensuring greater environmental protection from private developers. A key
component of development on the OCS is the process by which the property
interest is granted-in this case, an easement or right-of-way.241 The process is
important because it would regulate where and when development can take place,
and provide compensation for the use of public lands by private parties.242
a. Limiting Easements and Right-of-way Areas
The siting process is as crucial to the success of a wind power generation
facility as to an oil and gas development. While the existence of a finite
resource reserve is not relevant, wind farms cannot be successful without
sustainable winds.243 Further, large- scale wind farms, like the one proposed by
Cape Wind, call for the installation of hundreds of turbines, covering many
square miles of open ocean.244
Prior to offering easements and rights-of-way to private developers, the
federal government should identify a limited number of specific sites on the OCS,
which are well suited for wind power development. This process would be similar
to the tract system originally used for oil and gas development under the
OCSLA.245 By limiting potential easements, the "too much too fast"
problem encountered with areawide leasing under the OCSLA could be avoided,
allowing for meaningful environmental review. 246 Because Watt II found areawide
leasing within the scope of the secretary's designated responsibilities under
the OCSLA,247 it is important to explicitly exclude the practice in OCS wind
power legislation.
b. Maintaining Profitability
As Bruce Bailey, President AWS Scientific, Inc., pointed out in a
congressional hearing on Representative Cubin's bill, we are currently in the
"early and entrepreneurial stage of the offshore wind industry."248
Due to the amount of time and money required for private corporations to
determine th\e commercial viability of specific OCS sites for wind power
development, private corporations need financial incentive to propose wind
projects.249 Cape Wind and other developers have already added significant cost
to their development projects by studying the environment of Nantucket Sound in
order to achieve maximum potential energy generation and avoid environmental
conflicts in their siting decision.250
Developers like Cape Wind also hope to develop quickly before government
regulations require federal compensation for the use of the public land and
resources of the OCS. Some argue that any payment for property rights and
royalties should be minimal because, "unlike oil or natural gas facilities,
offshore wind plants will not extract any finite fuel source from the Outer
Continental Shelf where the wind is naturally replenished."251 The few
pioneer corporations proposing projects at this time, however, know that as the
demand for alternative energy grows and the advent of new efficient technology
lessens the cost of wind power generation, the profitability of such projects
will increase.252 Increased profitability will attract private developers and
support the growth of the industry.253
While federal policy should not stifle the entrepreneurial momentum of the
wind industry, the OCSLA legislative history demonstrates that encouraging
development by denying the federal government a fair return for public resources
may not survive public ; criticism, especially when the resulting development
places increased environmental burdens on coastal states.254 Instead of setting
low fees for property rights, and eliminating future royalties to create an
incentive for companies to develop, the secretary should be allowed to partially
refund fees or eliminate royalty requirements only when companies successfully
mitigate potential conflicts with the OCS environment. This policy would support
the growth of the industry by enhancing profitability. It appropriately
conditions development on reducing environmental risks, which, unlike oil and
gas development under the OCSLA, may actually encourage the wind industry to
innovate, making development less controversial and more sustainable.
CONCLUSION
Offshore wind power development on the OCS could be a crucial part of the
solution to growing concerns about global warming and dependence on foreign
energy sources. These developments should be encouraged. As Congress has
recognized, however, the OCS environment is a valuable public resource.255 Wind
power poses significantly fewer risks to this environment than oil and gas
development,256 but these risks should not be ignored in an effort to expedite
wind power production.
The OCSLA Amendments of 1978 attempted to balance environmental factors with
an overarching policy of expedited development, but failed to sustain
development when it became clear that environmental concerns were being ignored
to promote this policy.257 In order to achieve the benefits of wind's clean,
renewable energy, legislation authorizing wind power generation facilities must
equally balance environmental risks against other factors.258 It should also
include a stronger statement of the public trust philosophy, specific limits on
the amount of OCS land granted, and the use of revenue requirements as an
incentive for mitigating environmental risks.259
Unless new legislation accomplishes these goals, wind power development on
the OCS faces similar opposition to that which eventually led to a moratorium on
OCS oil and gas leases.260 The future of wind power as a viable energy source
is, therefore, dependant on not repeating the failures of the OCSLA in wind
power legislation.
ELIZABETH A. RANSOM*
* Symposium Editor and Solicitations Editor, BOSTON COLLEGE ENVIRONMENTAL
AFFAIRS LAW REVIEW, 2003-04.
Copyright Boston College, School of Law 2004