Chapter 9B Agencies, Communities, and Lawyers, Oh My! The Do's and Don'ts of Permitting Utility-Scale Renewable Energy Projects
| Jurisdiction | United States |
Chapter 9B Agencies, Communities, and Lawyers, Oh My! The Do's and Don'ts of Permitting Utility-Scale Renewable Energy Projects
KEVIN L. BAKER is the Deputy General Counsel for rPlus Energies, the nation's leader is developing pumped storage hydroelectric projects. Kevin a is an award-winning corporate attorney and works with large international companies. Previously, Kevin worked for over 20 years in the natural resource industry supporting, developing, and permitting large infrastructure projects. He has successfully managed projects that have been highly controversial and have had national implications. Kevin graduated from Brigham Young University with a Bachelor of Science in International Corporate Finance and two minors: German and Music. He also graduated from the University of Oregon with a Master of Business Administration and a Juris Doctorate in Law. Kevin is a published author and has written and developed his own comic strip. Kevin is also an Eagle Scout, an avid ballroom dancer, and golfer.
I. Introduction
For the past twenty years, I was by trade, a mining lawyer. I've worked with and represented several of the largest natural resource companies in the world. I've also successfully managed and been involved in some of the most complex mining and permitting issues in the United States. Recently, I made a career move into the renewable energy industry to help develop and permit large, utility-scale, pumped storage hydroelectric projects. When I made this move, I felt I was leaving behind an industry I knew and loved and where I was comfortable. I knew how the mining industry operated, I spoke the language, and I could interact in meaningful ways on complicated topics.
Remarkably, I found that the permitting and regulatory process for utility-scale renewable energy projects, such as pumped storage hydroelectric projects, is much like that for permitting large mining projects. Pumped storage hydroelectric projects involve substantial land impacts, development of large water reservoirs and dams, miles of transmission lines, interconnection with the electrical grid, acquisition of complex water and land rights, massive underground facilities, and tunneling to transport and use the water for electrical generation. The same or similar is increasingly true for other types of utility-scale renewable energy generation projects.
The experience I gained in the mining industry has helped me inform and shape how I approach federal and state agencies when undertaking the permitting process for these types of projects. Indeed, as the size and scale of renewable energy projects grows, the impacts of these projects will also grow. As a result, the need for successfully managing and dealing with project impacts in commercial, legal, and regulatory terms will increase.
The law and regulatory processes affecting renewable energy projects have not always kept up with the timing, demand, and technical requirements for their development. Utility-scale renewable energy projects are increasingly finding challenges and delays in progressing through intricate NEPA and other environmental review processes, managing habitat for sensitive species, obtaining access to public lands, competition for the use of increasingly scarce resources, as well as engaging with tribes and communities that do not completely know or understand the scope of project impacts.
Ultimately, the success of any renewable energy project hinges on valid, timely permitting. Indeed, if one looks at many of the recent Congressional policy proposals for renewable energy development, changes to the permitting process is at the top of the list. The real question we
[9B-1]
as legal professionals should be asking is, can we create a sustainable permitting and approval path forward to further allow the progress and development of utility-scale renewable energy projects while meeting the obligation to scrutinize alternatives and appropriately avoid, minimize, or mitigate project impacts.
The purpose of this paper is to provide an overview of permitting concerns and best practices that may come into play in developing utility-scale renewable energy generation and storage projects. This paper is intentionally more anecdotal than academic in nature. And, while I draw from and refer to my own experience in the mining industry, my hope is not to distract but to help and inform you in your own legal and regulatory practice. I believe that these experiences are directly transferable to the work you yourself may undertake in permitting renewable energy projects.
II. Electrical Generation and Consumption in the United States
Transition, transformation, and development. Today, these words are used interchangeably to discuss the ongoing evolution of renewable energy generation in the United States. Yet what these words really mean in terms of how people view, generate, and ultimately consume electricity is a matter of considerable public debate and policy making.
Electricity is essential in the United States. It is used in almost every aspect of life ranging from a multitude of industrial uses, to heating and cooling our homes, to running our computers and phones, and increasingly for transportation. In 2021, the United States consumed 3.9 trillion kilowatt-hours (kWh) of electricity. Generation of this electricity comes from a variety of different sources and technologies; the fuel source for most of this generation derives primarily from coal, natural gas, and nuclear power.
Today, the use of renewable energy in the United States is on the rise. This rise is driven both by a warming climate and the desire to decarbonize the electrical grid. According to the Pew Research Center, 72% of Americans support the United States' taking steps to decarbonize its electrical generation by 2050.1 Additionally, as renewable energy is increasingly prioritized, the cost of its implementation is decreasing making it more viable today than in previous years. This drives both the desire and the need for increased development of utility-scale renewable energy generation and energy storage in the United States. Despite this, the path towards sustainable renewable energy is both challenging and complex.
III. What is Permitting
Permitting is at the heart and forms the basis for any utility-scale renewable energy project. It is the refining fire that all projects must go through to receive all necessary regulatory
[9B-2]
authorizations. It informs the amount and scope of needed scientific studies and analytical data, the engineering, design, and functionality of the proposed project, as well as the type and methodology of activities that may be undertaken within a project area. It also informs the various options or alternatives that may be available to the permitting agency in its decision-making process.
Occasionally, permitting applicants will approach project permitting with a "check the box" mentality — almost as if the permit itself is important but ancillary to the overall economic aims and objectives of the project. There is a recognition of the need for the permit, but a misunderstanding of the requirements, timing, risk, and cost to obtain it. Additionally, permitting applicants may approach the regulatory process from a command-and-control mentality; that they control the regulatory process and that the agencies will simply approve the proposed project, with only slight modification. In reality, obtaining project permits is a gating challenge, requiring a good execution strategy, strong agency coordination, and frequent stakeholder interaction. It involves complex negotiations, indeterminate timeframes, and unspecified or unknown outcomes.
Agencies are not project proponents; they are responsible for and hold in trust public resources for the benefit of the public. Permitting applicants may forget that they are in fact an "applicant" and are subject to the process and decisions that the agency will make. Said differently, applicants have a right to apply for permission to build and operate their project, but the permitting agency is ultimately in control of the timing and outcome of the permitting process. As a result, applicants with pre-conceived expectations and hoped-for outcomes may become frustrated when encountering the realities of the agency's permitting process. Such situations may lead to adverse consequences for the project or adversarial processes that further raise the cost and potential delay for a project's approval. The goal for any permitting process is to align an applicant's expectations regarding schedule, cost and outcome with the agency's decision-making ability and process.
Permitting is simple in concept but complex in implementation. Permitting is simple in concept because it is how an applicant acquires regulatory approval to construct, operate, and maintain a project. Agencies want you to know that a regulatory process exists for their decision making, what that process is, and how to engage in it. Agency processes are defined in statutes and regulations and are publicly available. Typically, agencies will publish on their website the applicable statutes and regulations as well as any guidance documents for participating in their process. Thus, defining an individual regulatory process for any project is predictable and routine in nature.
Permitting is complex in implementation because not every agency has the same process, the same timing or nomenclature, or the same area of authority. Take for example a mining project. A permitting applicant might need to engage with multiple agencies having jurisdiction over the same resource. The United States Forest Service might have control over
[9B-3]
the surface lands while the Bureau of Land Management has control over the subsurface minerals; all in the same project footprint. In pumped storage hydro the permitting applicant could easily find a situation where the Bureau of...
To continue reading
Request your trial