2010-28269. Commercial Leasing for Wind Power on the Outer Continental Shelf (OCS) Offshore Maryland-Request for Interest (RFI)

AGENCY:

Bureau of Ocean Energy Management, Regulation and Enforcement, Interior.

ACTION:

RFI in Commercial Wind Energy Leasing Offshore Maryland, and Invitation for Comments from Interested and Affected Parties.

SUMMARY:

The Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE) invites submissions describing interest in obtaining one or more commercial leases for the construction of a wind energy project(s) on the Outer Continental Shelf (OCS) offshore Maryland. The BOEMRE will use responses to this RFI to enable BOEMRE to gauge specific interest in commercial development of OCS wind resources in the area described, as required by 43 U.S.C. 1337(p)(3). Parties wishing to obtain a commercial lease for a wind energy project should submit detailed and specific information as described below in the section entitled, “Required Indication of Interest Information.” Also, with this announcement the BOEMRE invites all interested and affected parties to comment and provide information—including information on environmental issues and concerns—that will be useful in the consideration of the RFI area for commercial wind energy leases.

This RFI is published pursuant to subsection 8(p) of the OCS Lands Act, as amended by section 388 of the Energy Policy Act of 2005 (EPAct) (43 U.S.C. 1337(p)(3)) and the implementing regulations at 30 CFR part 285.

The Western edge of the RFI area is located approximately 10 nautical miles from the Ocean City, Maryland coast and the Eastern edge is approximately 27 nautical miles from the Ocean City, Maryland coast. This area was delineated in consultation with the BOEMRE Maryland Renewable Energy Task Force. A detailed description of the RFI area is found later in this notice.

DATES:

The BOEMRE must receive your submission indicating your interest in this potential commercial leasing area no later than January 10, 2011 for your submission to be considered. The BOEMRE requests comments or other submissions of information by this same date. We will consider only the submissions we receive by that time.

Submission Procedures: You may submit your indications of interest, comments, and information by one of two methods:

1. Electronically: http://www.regulations.gov. In the entry titled “Enter Keyword or ID,” enter BOEM-2010-0038, then click search. Follow the instructions to submit public comments and view supporting and related materials available for this rulemaking. The BOEMRE will post all comments.

2. By mail, sending your indications of interest, comments, and information to the following address: Bureau of Ocean Energy Management, Regulation and Enforcement, Office of Offshore Alternative Energy Programs, 381 Elden Street, Mail Stop 4090, Herndon, Virginia 20170.

FOR FURTHER INFORMATION CONTACT:

Aditi Mirani, Renewable Energy Program Specialist, Bureau of Ocean Energy Management, Regulation and Enforcement, Office of Offshore Alternative Energy Programs, 381 Elden Street, Mail Stop 4090, Herndon, Virginia 20170-4817; telephone [phone].

SUPPLEMENTARY INFORMATION:

Purpose of the Request for Interest

The OCS Lands Act requires BOEMRE to award leases competitively, unless BOEMRE makes a determination that there is no competitive interest (43 U.S.C. 1337(p) (3)). This RFI is a preliminary step in the leasing process and the responses to it will assist BOEMRE in determining if there is competitive interest in the area described herein on the OCS offshore Maryland. If, following this RFI, BOEMRE determines that there is no competitive interest in this area offshore Maryland, BOEMRE may proceed with the noncompetitive leasing process pursuant to 30 CFR 285.232 of the Renewable Energy and Alternate Uses of Existing Facilities on the Outer Continental Shelf (REAU) rule. If, following this RFI, BOEMRE determines that there is competitive interest in the RFI area, BOEMRE may proceed with the competitive leasing process set forth under 30 CFR 285.211 through 285.225. Whether the leasing process is competitive or noncompetitive, it will include opportunities for the public to provide input as well as a thorough environmental review, and will be conducted in conformance with all applicable laws and regulations.

Parties other than those interested in obtaining a commercial lease are welcome to submit comments in response to this RFI. Further, BOEMRE has formed the BOEMRE Maryland Renewable Energy Task Force for coordination among affected Federal agencies and State, local, and Tribal governments throughout the leasing process. Task Force meeting materials are available on the BOEMRE Web site at: http://www.BOEMRE.gov/​offshore/​RenewableEnergy/​stateactivities.htm#Maryland.

Background

Energy Policy Act of 2005

The EPAct amended the OCS Lands Act by adding subsection 8(p), which authorizes the Secretary of the Interior to grant leases, easements, or rights-of-way (ROWs) on the OCS for activities that are not otherwise authorized by law and that produce or support the production, transportation, or transmission of energy from sources other than oil or gas. The EPAct also required the issuance of regulations to carry out the new authority pertaining to renewable energy on the OCS. The Secretary delegated this authority to issue leases, easements, and ROWs, and to promulgate regulations, to the Director of BOEMRE. The BOEMRE published the REAU rule on April 29, 2009 (74 FR 81 April, 29, 2009).

Determination of Competitive Interest

The first step in determining whether there is competitive interest in an area for offshore wind energy projects will be the evaluation of submissions describing nominations of particular areas of interest as suitable for renewable energy projects in response to this RFI. At the conclusion of the comment period for this RFI, the BOEMRE will review the information received, undertake a completeness review and qualifications review of the nominations received and make a determination of competitive interest.

The BOEMRE will first determine whether there is any geographic overlap of any nominated areas of interest. If two areas of interest fully or partially overlap, the competitive process will begin as outlined in 30 CFR 285.211 through 285.225.

Situations may arise in which several parties nominate project areas that do not overlap. Under these circumstances, BOEMRE could choose to employ an allocation system of leases that involves competition across tracts. This system is referred to as intertract competition and will also be implemented under the competitive process outlined in 30 CFR 285.211 through 285.225. The BOEMRE may consult with the BOEMRE Maryland Renewable Energy Task Force in determining intertract competition.

Competitive Process

If BOEMRE determines that competitive interest exists for this area, it would proceed with the following defined process, as described in 30 CFR 285.211 through 285.225, consulting with the BOEMRE Maryland Renewable Energy Task Force as appropriate:

(1) Call for Information and Nominations (Call). The BOEMRE would publish in the Federal Register a notice of a Call for Information and Nominations for leasing in specified areas. The comment period following the notice of a Call would be 45 days. In the notice, BOEMRE may request comments seeking information on areas that should receive special consideration and analysis; on geological conditions (including bottom hazards); on archaeological sites on the seabed or nearshore; on possible multiple uses of the proposed leasing area (including navigation, recreation, and fisheries); and on other socioeconomic, biological, and environmental matters.

In response to the Call, the BOEMRE would require potential lessees to submit the following information: the area of interest for a possible lease; a general description of the potential lessee's objectives and the facilities that the potential lessee would use to achieve those objectives; a general schedule of proposed activities, including those leading to commercial operations; data and information concerning renewable energy and environmental conditions in the area of interest, including the energy and resource data and information that was used to evaluate the area of interest; and documentation showing that the submitting entity is qualified to hold a lease. However, an applicant would not be required to resubmit information already submitted in response to this RFI.

(2) Area Identification. The BOEMRE would identify areas for environmental analysis and consideration for leasing in discussion with appropriate Federal agencies, States, local governments, Indian Tribes, and other interested parties based on the information submitted in response to this RFI and the Call.

(3) Proposed Sale Notice. The BOEMRE would then publish a Proposed Sale Notice (PSN) in the Federal Register and send the PSN to the Governor of any affected State and the executive of any local government that might be affected. The PSN would describe the areas offered for leasing and the proposed terms and conditions of a lease sale, including the proposed auction format, lease form, and lease provisions. Additionally, the PSN would describe the criteria and process for evaluating bids. The PSN would be issued after completion of the final National Environmental Policy Act (NEPA) documentation, preparation of the Consistency Determination as required by the Coastal Zone Management Act (CZMA) and its implementing regulations, and preparation of various analyses of proposed lease sale economic terms and conditions. The comment period following issuance of a PSN would be 60 days.

(4) Final Sale Notice. The BOEMRE would then publish the Final Sale Notice (FSN) in the Federal Register at least 30 days before the date of the sale. Should BOEMRE proceed with a competitive auction to award leases, BOEMRE would use one of the following three auction formats to select the winner as described at 30 CFR 285.220: sealed bidding; ascending bidding; or two-stage bidding (a combination of ascending bidding and sealed bidding). The BOEMRE would publish the criteria for winning bid determinations in the FSN.

(5) Bid Evaluation. Following publication of the FSN in the Federal Register, qualified bidders may submit their bids to BOEMRE in accordance with procedures specified for the auction format to be used. The bids, including the bid deposits, if applicable, would be checked for technical and legal adequacy. The BOEMRE would evaluate the bids to determine if the bidder has complied with all applicable regulations. The BOEMRE reserves the right to reject any or all bids and the right to withdraw an offer to lease an area from the sale.

(6) Issuance of a Lease. Following the selection of a winning bid by the BOEMRE, the submitter would be notified of the decision and provided a set of official lease forms for execution. The successful bidder would be required to execute the lease, pay the remainder of the bonus bid, if applicable, and file the required financial assurance within 10 days of receiving the lease copies. Upon receipt of the required payments, financial assurance, and properly executed lease forms, BOEMRE would issue a lease to the successful bidder.

Noncompetitive Process

If BOEMRE determines that there is no competitive interest in a proposed lease, it may proceed with the noncompetitive lease issuance process, pursuant to 30 CFR 285.232, consulting with the BOEMRE Maryland Renewable Energy Task Force as appropriate. Within 60 days of the date of a determination of no competitive interest, the respondent would be required to submit a Site Assessment Plan (SAP), as described in CFR 285.231(d)(2)(i).

Leases issued noncompetitively must comply with the requirements of NEPA, CZMA, the Endangered Species Act (ESA), and other applicable Federal statutes. In accordance with 30 CFR 285.231(e), BOEMRE would coordinate and consult, as appropriate, with affected Federal agencies, State and local governments, and affected Indian Tribes in issuing a noncompetitive lease and developing lease terms and conditions.

It is possible that responses to this RFI may result in determinations that there is competitive interest for some areas but not for others. The BOEMRE will announce publicly its determinations before proceeding with a competitive process, a noncompetitive process, or both.

Environmental Review

BOEMRE will conduct environmental reviews of its leasing and development decisions pursuant to NEPA, ESA and other environmental statutes, as appropriate. Should BOEMRE determine that any activity it is considering authorizing constitutes a major Federal action significantly affecting the environment, BOEMRE would prepare an environmental impact statement (EIS) to analyze the effects of such an action. This would include a public scoping period, including a 30-day comment period and one or more public meetings conducted to solicit input on the alternatives and issues to be addressed in a draft EIS. The draft EIS would describe the nature of the action under consideration, and any potential direct, indirect, and cumulative impacts that the action will have on biological or physical resources, as well as on socioeconomic conditions. During this process, BOEMRE would review pertinent published and unpublished studies from academic and other institutions and organizations and from other Federal and State agencies. Upon completion of a draft EIS, BOEMRE would file the draft EIS with the Environmental Protection Agency (EPA) and would publish a Notice of Availability in the Federal Register. The draft EIS would be made available and distributed for public review and comment during a minimum 45-day public comment period.

The BOEMRE would hold one or more public hearings in the vicinity of the proposed lease area for the purpose of receiving comments on the draft EIS. The BOEMRE would announce the time and location in the Federal Register at least 30 days before the public hearings.

The BOEMRE would analyze the comments and information received during the public review process, including those from public hearings, along with any newly acquired information and, where appropriate, would incorporate this information into the final EIS. Based on the NEPA analysis, results of the consultations, and comments received, the BOEMRE would develop lease terms or stipulations to protect sensitive areas and/or biological and cultural resources. After the public hearings, BOEMRE would develop a final EIS. The BOEMRE would file the final EIS with EPA and publish a Notice of Availability in the Federal Register.

Description of the Area

The RFI area was delineated through consultation with the BOEMRE Maryland Renewable Energy Task Force. The following full OCS lease blocks are included within the RFI area: Salisbury NJ18-05 Blocks 6624, 6625, 6626, 6627, 6628, 6629, 6674, 6675, 6676, 6677, 6678, 6679, 6724, 6725, 6726, 6727, 6728, 6729, 6774, 6775, 6776, 6777, 6778, 6779, 6825, 6826, 6827, 6828, 6829. In addition, parts of the following blocks are included within the area of interest: Salisbury NJ18-05 Blocks 6623, 6673, 6723 and 6773 as described in the table below.

Protraction name	Protraction number	Block number	Sub block
Salisbury	NJ18-05	6623	C,D,G,H,K,L,O,P
Salisbury	NJ18-05	6673	C,D,G,H,K,L,O,P
Salisbury	NJ18-05	6723	C,D,G,H,K,L,O,P
Salisbury	NJ18-05	6773	C,D,G,H

The Western edge of the RFI is approximately 10 nautical miles from the Ocean City, Maryland coast, and the Eastern edge is approximately 27 nautical miles from the Ocean City, Maryland coast. The longest portion of the North/South portion is approximately 13 nautical miles in length and the longest portion of the East/West portion is approximately 17 nautical miles in length. The area is made up of straight lines that are comprised of 29 whole OCS blocks, 3 half blocks and 1 quarter block. The entire area is approximately 206.55 square nautical miles; 175,069.22 acres; or 70848 hectares.

The boundary of the RFI follows the points listed in the table below in clockwise order. Point numbers 1 and 9 are the same. Coordinates are provided in X, Y (eastings, northings) UTM Zone 18N, NAD 83 and geographic (longitude, latitude), NAD83.

Point No.	X (easting)	Y (northing)	Longitude	Latitude
1	512000	4257600	−74.8624454	38.4666335
2	543200	4257600	−74.5048114	38.4656677
3	543200	4233600	−74.5062825	38.2493794
4	519200	4233600	−74.7805670	38.2502128
5	519200	4238400	−74.7804368	38.2934724
6	514400	4238400	−74.8353273	38.2935622
7	514400	4240800	−74.8352784	38.3151920
8	512000	4240800	−74.8627320	38.3152273
9	512000	4257600	−74.8624454	38.4666335

Specific mitigation, stipulations, or exclusion areas may be developed as a result of site specific environmental reviews and associated consultations, as well as continued coordination through the BOEMRE Maryland Renewable Energy Task Force. At this point, for the area under consideration, multiple use conflicts may result in requiring mitigation or excluding certain OCS blocks or portions of OCS blocks. Multiple use issues associated with Department of Defense activities and U.S. Coast Guard responsibilities were raised at the BOEMRE Maryland Renewable Energy Task Force meetings. These are described below.

Traffic Separation Scheme (TSS) and Navigational Issues

The BOEMRE is aware that the RFI area lies adjacent or in close proximity to a Traffic Separation Scheme (TSS) and thus the areas nominated in response to this RFI may need to be modified. The U.S. Coast Guard will require buffers from the edges of a TSS and from the entrance and exit to a TSS. Because proposed project characteristics will be unique to each individual project, the buffers will be further defined as more information is collected, such as vessel traffic types, density and routing direction. Further, it is important to note that two-way routes, fairways and TSSs are various forms of routing measures and that buffer dimensions will vary because of many factors, one of which is vessel traffic density/composition and rules-of-the-road protocol.

The BOEMRE will take into consideration and review data including but not limited to Automatic Identification System (AIS) data that is used on ships and vessel traffic services. The BOEMRE will also consult with relevant agencies such as the U.S. Coast Guard regarding potential issues concerning the TSS and other navigational and safety issues and will use best management practices. Depending on the findings, BOEMRE and the U.S. Coast Guard will develop reasonable and appropriate mitigations such as conditions on turbine placement, preservation of adequate navigation buffers and setbacks, protection of vessel traffic lanes or other operational restrictions utilizing their existing authorities, policies, and procedures.

If such mitigation cannot be achieved, portions of certain nominated areas may need to be excluded. The following blocks are highlighted for consideration of U.S. Coast Guard concerns: 6625, 6626, 6627, 6628, 6629, 6675, 6676, 6677, 6678, 6679, 6726, 6727, 6728, 6729, 6776, 6777, 6778, 6779, 6826, 6827, 6828, and 6829.

Department of Defense Activities and Stipulations

The Department of Defense conducts offshore testing, training, and operations in the RFI area. The BOEMRE will consult with the Department of Defense regarding potential issues concerning offshore testing, training, and operational activities, and will use best management practices to develop appropriate stipulations to mitigate the effects of wind turbines in the RFI area. The Department of Defense will request site specific stipulations in the following 23 lease blocks: 6624, 6625, 6626, 6627, 6628, 6629, 6674, 6675, 6676, 6677, 6678, 6724, 6725, 6726, 6727, 6728, 6774, 6775, 6776, 6777, 6825, 6826, 6827, and the following four partial lease blocks: 6623, 6673, 6723, and 6773.

Map of RFI area

A map of the RFI area can be found at the following URL: http://www.BOEMRE.gov/​offshore/​RenewableEnergy/​stateactivities.htm#Maryland.

A large-scale map of the RFI area showing boundaries of the RFI area with numbered blocks is available from BOEMRE at the following address: Bureau of Ocean Energy Management, Regulation and Enforcement, Office of Offshore Alternative Energy Programs, 381 Elden Street, Mail Stop 4090, Herndon, Virginia 20170, Phone: [phone], Fax: [phone].

Required Indication of Interest Information

If you intend to submit an indication of interest in a commercial lease from BOEMRE for the development of wind resources in the area(s) identified in this RFI, you must provide the following:

(1) The BOEMRE Protraction name, number, and specific whole or partial OCS blocks or areas within the RFI area that are of interest for commercial development, including any required buffer area. If your proposed project area includes one or more partial blocks please describe those partial blocks in terms of a sixteenth of an OCS block. Note that any indications of interest identifying areas greater than what would be reasonably necessary to develop a proposed commercial wind facility will not be considered as valid indications of interest. In addition, BOEMRE will not consider any areas outside of the RFI area in this process;

(2) A description of your objectives and the facilities that you would use to achieve those objectives;

(3) A schedule of proposed activities, including those leading to commercial operations;

(4) Available and pertinent data and information concerning renewable energy resources and environmental conditions in the RFI area, including energy and resource data and information used to evaluate the RFI area;

(5) Documentation demonstrating that you are legally, technically and financially qualified to hold a lease as set forth in 30 CFR 285.106 and 285.107. Your technical and financial documentation should demonstrate that you are capable of constructing, operating, maintaining, and decommissioning the facilities described in (2) above. Documentation of financial qualification may include information establishing access to sufficient capital to carry out development. Examples of documentation of technical qualification may include evidence of international or domestic experience with renewable energy projects or other types of electric-energy-related projects.

It is critical that you submit a complete indication of interest so that BOEMRE may proceed with the commercial wind leasing process offshore Maryland in a timely manner. If BOEMRE reviews your indication of interest and determines that it is incomplete, BOEMRE will inform you of this determination in writing. This letter will describe the information that BOEMRE determined to be missing from your indication of interest, and that you must submit in order for BOEMRE to deem your submission complete. You will be given 15 business days from the date of the letter to submit the information that BOEMRE found to be missing from your original submission. If you do not meet this deadline, or if BOEMRE determines this second submittal to be insufficient as well, then BOEMRE retains the right to deem your indication of interest invalid. In that case, BOEMRE would not move forward with your indication of interest submitted in response to this RFI.

Privileged or Confidential Information

The BOEMRE will protect privileged or confidential information that you submit as required by the Freedom of Information Act (FOIA). Exemption 4 of FOIA applies to trade secrets and commercial or financial information that you submit that is privileged or confidential. If you wish to protect the confidentiality of such information, clearly mark it and request that the BOEMRE treat it as confidential. The BOEMRE will not disclose such information, subject to the requirements of FOIA. Please label privileged or confidential information “Contains Confidential Information” and consider submitting such information as a separate attachment.

However, BOEMRE will not treat as confidential any aggregate summaries of such information or comments not containing such information. Additionally, BOEMRE will not treat as confidential (1) the legal title of the nominating entity (for example, the name of your company), or (2) the list of whole or partial blocks that you are nominating.

Dated: October 25, 2010.

Michael R. Bromwich,

Director, Bureau of Ocean Energy Management, Regulation and Enforcement.