California Legislature Passes Landmark Legislation To Bolster Offshore Wind Energy – Energy and Natural Resources – United States – Mondaq News Alerts

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The California Legislature on Sept. 9, 2021, approved landmark state legislation to facilitate California's offshore wind energy potential. Assembly Bill (AB) 525 requires the California Energy Commission (CEC) to prepare a strategic plan for developing offshore wind resources in the years to come, as well as specific megawatt targets for 2030 and 2045. The legislation has been submitted, and is now awaiting the governor's signature.
Project developers, energy customers and stakeholders alike should be aware of AB 525 and the following précis on the current status for offshore wind projects in California.
AB 525 requires the CEC – in conjunction with other key state agencies (e.g., State Lands Commission, California Public Utilities Commission) – to develop a strategic plan for offshore wind development installed in federal waters off the coast of California. The strategic plan must include five chapters, at a minimum, covering the following components:
The CEC is statutorily mandated to submit the strategic plan to the California Natural Resources Agency by June 30, 2023, and prior to that, release a draft strategic plan for public review and comment.
In addition to the strategic plan, the CEC is required to establish megawatt planning goals for 2030 and 2045 by June 1, 2022.
Under the Energy Policy Act of 2005 and Outer Continental Shelf (OCS) Renewable Energy Program (30 C.F.R. §§ 585.100 et seq.), the U.S. Department of the Interior's Bureau of Ocean Energy Management (BOEM) may issue leases authorizing developers to use a designated portion of the OCS for renewable energy projects. Once awarded, a lease does not grant developers with the right to construct facilities, but rather, the exclusive right to plan an offshore wind project.
BOEM's leasing process for offshore wind projects generally consists of the following four stages:
California's offshore wind potential is currently focused on two “Call Areas”: 1) the Humboldt Call Area (North Coast) and 2) the Morro Bay Call Area (Central Coast). The Humboldt Call Area is farther along in the planning process, as BOEM had previously issued a Call for Information and Nominations in October 2018. More recently, on July 28, 2021, BOEM formally designated the Humboldt Wind Energy Area (WEA), and announced that it will be proceeding with an environmental review under the National Environmental Policy Act (NEPA).
As for the Morro Bay Call Area, on July 28, 2021, BOEM issued a Call for Information and Nominations for the Morro Bay Call Area. The comment period concluded on Sept. 13, 2021, with a total of 52 comments received. In the future, BOEM intends to “catch-up” the Morro Bay Call Area into a single, concurrent planning process for both Call Areas. The agency expects to publish a single PSN and FSN for both lease areas, and issue lease sales as early as summer 2022.
BOEM's designation of a WEA marks the beginning of the environmental review process under NEPA. Once a WEA is designated, BOEM generally will prepare and release for public comment an Environmental Assessment (EA) which will analyze the environmental effects of site assessment activities (not development activities).
BOEM's approval of a developer-lessee's COP is also subject to NEPA. Typically, BOEM will issue a Notice of Intent (NOI) to prepare an Environmental Impact Statement (EIS) for any wind energy facility and infrastructure proposed. The EIS will consider the environmental effects of BOEM's approval of the COP, as well as project alternatives and mitigation measures to avoid or reduce the severity of significant environmental effects. The EIS will likely provide environmental clearance for not only BOEM's approval, but also other approvals required from other federal cooperating agencies (e.g., U.S. Army Corps of Engineers – Section 10 Permit under the River and Harbors Act and Section 404 Permit under the Clean Water Act; National Marine Fisheries Service – Incidental Harassment Authorization under the Marine Mammal Protection Act).
Although offshore wind projects are slated to be located in federal waters that does not insulate such projects from state environmental review under CEQA. Offshore wind projects will likely require state discretionary approvals for not only on-land activities, but also offshore activities with the potential to impact coastal resources within the state's jurisdiction. State-level approvals may include the issuance of a tidelands lease, a coastal development permit (CDP), and/or Consistency Determination(s) or Certification(s) under the Coastal Zone Management Act.
The logical proposal would be for federal and state agencies to coordinate their NEPA and CEQA obligations in a joint environmental review document (i.e., an EIR-EIS). While the environmental review coordination process remains to be seen, the CEC's strategic plan required under AB 525 must include recommendations on NEPA and CEQA coordination.
The U.S. National Renewable Energy Laboratory estimates that California has the technical potential for 200 gigawatts of offshore wind generation. Whereas projects off the East Coast use predominately fixed-foundation technologies, the vast majority of California's offshore wind potential is located in the OCS at depths greater than 60 meters. The primary technology for offshore wind development in California is expected to be floating wind turbines. While floating wind projects have not yet been deployed at scale in comparison to their ocean floor-mounted counterparts, at least two floating turbine projects in Europe have proven to be successful (the 30 MW Hywind project in Scotland and the 24 MW WindFloat Atlantic project in Portugal).
Although California's offshore wind planning processes has languished in comparison to East Coast states (e.g., Massachusetts, New York and New Jersey), that is quickly changing. Taken together, AB 525's mandates and BOEM's planning processes signal realistic prospects for large-scale offshore wind projects, which may be coming sooner than previously expected.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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