US Proposal For Fee Reduction for Wind and Solar Energy on Federal Lands

The Biden administration unveiled a new proposal on Thursday to formalize a significant project fee reduction for wind and solar energy developments on federal lands. The regulation aims to boost renewable energy deployment as part of the administration’s strategy to combat climate change.

Last year, the US Bureau of Land Management (BLM), a division of the Interior Department, had already reduced rent fees and lease rates for solar and wind projects by approximately 50 per cent after developers expressed concerns that the fees were hindering investment. The latest proposal seeks to deepen those fee reductions and establish them as a formal regulation, making it more difficult for future administrations to reverse the changes.

President Biden has set a target of decarbonizing the US electricity sector by 2035, necessitating the rapid deployment of wind and solar energy. The BLM manages a substantial portion of the nation’s land, with one in every 10 acres falling under its jurisdiction. The Interior Department has been mandated by Congress to permit 25 gigawatts (GW) of renewable energy on federal lands by 2025.

Under the proposed rule, project fee reduction would be by around 80 per cent, allowing the BLM to accept leasing applications in priority areas for wind and solar development without relying solely on competitive auctions. Additionally, the agency is considering further fee reductions for projects that use American-made equipment or are constructed with union labour. These proposals align with President Biden’s commitment to leveraging climate action to rejuvenate U.S. manufacturing and create well-paid union jobs.
The proposal will undergo a 60-day public comment period, and the BLM aims to finalize the rule next year. Currently, the agency is processing 74 applications for solar, wind, geothermal, and transmission line projects associated with clean energy development. Together, these projects have the potential to add over 37 GW of renewable energy capacity to the grid.

BLM Director Tracy Stone-Manning emphasized the crucial role that public lands play in facilitating the clean energy transition. The agency is also actively identifying new areas in the Western United States suitable for solar development.