By Tim Power
Offshore wind projects face challenges that are not addressed by the regulatory system established for onshore projects
Around the globe, opportunity is on the rise, but regulatory and political challenges persist
Throughout the world, many national and local governments are creating regulatory and commercial environments to encourage developers, lenders and investors to build, finance and invest in offshore wind energy. This has led to an upswing in the number of offshore wind projects being planned and built around the world. Renewable energy generated by offshore wind power is typically consistent with nations' climate change commitments under the Paris Agreement to reduce greenhouse gas emissions. However, offshore wind farms have unique impacts, which are addressed through environmental and natural resource policies and rules.
Governments in many of the key markets for offshore wind investment typically require the environmental and social impacts of a proposed offshore wind project to be assessed and mitigated. The complexity, sophistication and duration of the environmental impact assessment process varies across jurisdictions, and must be carefully evaluated by potential developers and investors. Project proponents also need to be mindful that in most jurisdictions, although to varying degrees, the environmental and social impact assessment
is subject to public scrutiny and comment, and can also be vulnerable to legal challenges.
This report offers an overview of key environmental risks raised by offshore wind projects in six key jurisdictions: Australia; Germany; Japan; Mexico; the UK; and the US. Offshore wind farms operate in many of these jurisdictions. In others, they are increasingly attractive because of higher offshore wind speeds and capacity factors, shallow ocean depths and supportive government policies. We summarize how regulators in these jurisdictions require project proponents to consider impacts to birds, bats, fish and marine mammals during the development process. We also assess how noise associated with the construction and operation of offshore wind projects must be addressed. Finally, we focus on the aesthetic considerations, decommissioning requirements and impacts to fishing, navigation and transportation that arise in the planning, construction and operation of an offshore wind project.
To maximize its potential, industry players will have to navigate an often-complex web of national, state and local environmental regulation
Despite strong government support and growing capacity, a lengthy approval process may slow progress
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In November 2018, the National Diet of Japan enacted the Act of Promoting Utilization of Sea Areas in Development of Power Generation Facilities Using Maritime Renewable Energy Resources. This new act establishes a legal framework for the approval of project proposals in a bid to provide greater certainty and transparency to investors and developers. The offshore wind market in Japan has already received significant attention from domestic and overseas investors, not least because Japan is a large consumer of electricity and an island nation with surrounding territorial waters and an exclusive economic zone that totals approximately 4.47 million kms. However, the marine environment and seafloor topography surrounding Japan are not homogenous, and prospective investors and developers need to carefully examine each proposed project site to account for this.
Offshore wind farms with a capacity of 61.6 megawatts (MWs) are operating in Japan, based on public information as of January 2017. Most of these are small-scale projects operating single or a few wind turbine(s).
As of December 2018, the cumulative capacity of operational onshore and offshore wind farms in Japan had increased to 3,653 MWs, with a total of 441 wind farms operating 2,310 wind turbines, based on information published by the Japan Wind Power Association. One driver for this growth in wind power generation is the strong government backing of these projects, given the Japanese government's goal of increasing the operational capacity of both onshore and offshore wind farms to approximately 10,000 MWs by 2030.
However, large-scale wind farm project development must occur under the Environmental Impact Assessment Act (described below), and the mandated environmental impact assessment process can take four to five years to complete. The long lead time to conduct this process has been cited as one bottleneck for developing offshore wind farms in Japan, and it is predicted that the government's 2030 goal will only be achieved if, among other factors, the average lead time is halved.
The EIA Act governs the compulsory environmental impact assessment process, and an amendment that took effect in April 2013 broadened the act's scope to include wind power development projects. The act classifies wind power projects into three categories based on the following power outputs:
|Category||Total power output|
|Class 1 projects, which are invariably subject to EIA procedure||at least 10 MWs|
|Class 2 projects, which are subject to EIA procedure upon screening||at least 7.5 MWs but less than 10 MWs|
|Non-applicable projects||less than 7.5 MWs|
As offshore wind farms are relatively large in scale and will invariably produce more than 10 MWs, they will typically be subject to a Class 1 project classification under the EIA Act. This means that, without exception, these projects will require environmental impact assessment procedures. If a project falls under a Class 2 project classification, the government will determine whether environmental impact assessment procedures should be carried out on a case-by-case basis.
Broadly, five stages of the environmental impact assessment procedure must be conducted before construction commences: (1) primary environmental impact consideration; (2) scoping; (3) survey, forecast and evaluation; (4) drafting an environmental impact statement; and (5) producing an environmental impact statement. Notably, all of these stages except the third involve consultation with the public and relevant authorities.
The Ministry of Economy, Trade and Industry (METI) and the Ministry of the Environment (MOE) have undertaken various efforts to accelerate the environmental impact assessment procedure. These include a verification project administered by the New Energy and Industrial Technology Development Organization that examined the procedure in project applications received between 2014 and 2017. One of its recommendations was to introduce a front-loading survey, forecast and evaluation procedure without delaying the process to hear public opinion and consult with relevant authorities to select the evaluation items as well as the survey, forecast and evaluation methods. Traditionally the actual survey, forecast and evaluation procedures started after the hearing, consultation and selection process. Whether this front-loading procedure is undertaken largely depends on the project parties' risk appetite because potentially, the already-started process will not be fully confirmed later and some additional assessment may be conducted.
Impacts to "seabirds" must be addressed under the environmental impact assessment procedure. To assess the impact to seabirds, wind project proponents must follow a survey method to "grasp the current situation based on review of past questionnaires and interviews with experts and bird-related organizations," a prediction method based on past survey materials to "qualitatively predict the degree of seabird distribution, habitat modification, etc.," and an evaluation method based on these prediction results to qualitatively "compare and examine the seabirds' distribution area and the habitat modification."
By following these methods, the environmental impact assessment must address items such as (1) the reduction, deterioration, loss of avian habitat and movement (including path inhibition and/or blocking); (2) the possibility of interference from birds on proposed equipment or property; and (3) the attraction of birds due to night lighting. In 2011, the MOE issued a "Guideline for Optimizing the Location of Wind Power Generation Facilities regarding Birds," which was revised in 2015. The MOE guideline mentions cases where certain conservative measures, and the review of business plans, may be required to protect seabirds.
Other applicable regulations include the Act on Protection of Wildlife and Optimization of Hunting (Wildlife Act) and the Act on Conservation of Endangered Species of Wild Fauna and Flora (Conservation of Species Act). Under the Wildlife Act, hunting is forbidden in wildlife protection zones, and in special protected areas, permission is required for proposed development activities. Similarly, under the Conservation of Species Act, permission is required for proposed development activities in administrative districts or monitored districts in habitat-protected areas.
In March 2018, the MOE published the Sensitivity Map for Wind Power Evaluation Site Review (Sensitivity Map Report), which examined the site location of a wind power project, and the influence this had on birds. In creating the Sensitivity Map Report, ten bird species were designated as "important species." These were the eagle, eastern marsh harrier, Von Schrenck's bittern, Eurasian bittern, Blakiston's fish owl, mountain hawk, white-tailed eagle, red-crowned crane, Steller's sea eagle and stork. These designations have provided important clarity to offshore wind farm developers in their environmental impact assessments.
Impact to "landscape" is another environmental impact assessment evaluation item. This assessment of visual impact is conducted by using sightseeing maps, online information and field surveys, and selecting various viewpoints of historical and/or cultural significance from which to visually predict and evaluate any changes a project is expected to have on the relevant landscape. This is done by predicting the viewing distance, viewing occupancy and anticipated angle, and producing a photo montage. Each photo montage created by these methods is examined thoroughly from these various viewpoints, and questionnaires are often provided to local residents for feedback.
Furthermore, wind farm development projects are typically subject to the Landscape Act. Under the Landscape Act, municipalities may, in their ordinances, restrict the installation and development of certain facilities in a "Landscape District" to maintain an appropriate landscape. Many local municipalities enact these landscape-related ordinances, making early consultation with the local government an important step in the landscape and visual impact assessment, as it is important to understand the local government's perspective on the proposed project's visual elements, such as the color and arrangement of wind farm equipment.
The environmental impact assessment covers evaluation items such as "benthic living organisms," "fishes" and "marine mammals." The influence of turbidity, transmission of soundwaves underwater and the potential for the disappearance of habitat are required to be investigated, predicted and evaluated based on past data and materials concerning flow direction, flow speed, water quality and other factors during and after the construction period.
Other applicable regulations include the Conservation of Species Act, the Act on the Protection of Fishery Resources (Fisheries Act) and the Marine Fishery Resources Development Promotion Act (Marine Resources Act). Under the Conservation of Species Act, proposed development activities require prior permission if they occur in administrative districts or monitored districts in habitat-protected areas. Under the Fisheries Act, any construction, such as landfilling within an area of protected water requires permission from the prefecture or the Ministry of Agriculture, Forestry and Fisheries. Under the Marine Resources Act, notification is required for any proposed acts that potentially change the traits of the sea floor in the designated coastal areas.
In Japan, fishing is traditionally regarded as a critical industry. To obtain a municipality-issued "occupy permit" in a maritime area for offshore wind farm development, consensus from the local fishing union is typically necessary. This consensus is usually provided based on indemnifications made by the project parties to the union.
"Noise and vibration" impacts must also be evaluated in the environmental impact assessment. Noise and low-frequency sound are usually predicted based on past surveys, and will be evaluated through comparison with environmental standards.
The MOE launched a study committee in 2013 on methods for evaluating noise impacts from wind power generation facilities, and published the "Countermeasure against Noise Generated from Wind Power Generation Facilities" report in November of 2018. The report provides certain evaluation standards. However, these have been received as guidelines, rather than national uniform standards, given that the degree of noise from wind farms differs depending on the size of the facility, the wind conditions of the project site, the topography of the project site, the type of land use and the distance between the noise source and the noise recording device(s).
Other applicable laws include the Noise Regulation Act, and noise regulation standards set by the prefectural governor, which regulate the timing and permitted areas for noise pollution in designated noise regulation areas. As such, prior notification is required when installing a wind turbine and conducting specific construction work in designated noise regulation areas.
It is worth noting that, in 2015, a lawsuit on claims of moral rights violations from noise produced by certain onshore wind power generation facilities was unsuccessful. This onshore wind farm started operation in 2007, so it was not subject to the environmental assessment process under the EIA Act. The complainant did not obtain compensation or an injunction restricting the facilities' operations. The key issue in that case was whether the noise produced fell outside the tolerance limit.
Decommissioning is not evaluated through the environmental assessment process, but is assessed under the Japanese Feed-in-Tariff Act. Under this Act, project developers must make appropriate decommissioning plans for a project at the 20-year mark when they submit an application for certification of the business plan to METI, and these plans must include decommissioning costs (to be determined based on estimates by waste disposal companies). The "Business Plan Guideline" published by the Agency for Natural Resources and Energy recommends that, if it is difficult to obtain an estimate of decommissioning costs from waste disposal companies, such cost is expected to be calculated in the amount of 5 percent or more of the construction cost.
Further, after power generation facilities are removed and decommissioned, they must be treated, in principle, as "industrial waste" under the Waste Management and Public Cleansing Act. Usually, a wind power generation provider is required to dispose of and recycle these facilities in accordance with this act and related regulations.
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