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Wind Energy: Challenged Under Federal Regulations, but More Native American Nations Appear to Be Embracing Its Development

February 24, 2016
By Walter E. Stern and Sarah M. Stevenson

Wind farms offer a source of low-carbon energy and are being developed around the world as governments and private entities seek new sources of energy to power our world.  Development of wind farms is not a simple task, though, and developers are often faced with challenges from property owners in the vicinity of development.  Native American Nations and tribal entities find themselves on both sides of this issue, developing or investing in wind farms in some cases, and challenging their development in others.  This article reviews current developments in Native American involvement in wind energy issues.

Challenge to Wind Farm Development:

In Osage County, Oklahoma, Enel Kansas, LLC, Enel Green Power North America, Inc., and a subsidiary, Osage Wind LLC, constructed and own the Osage Wind wind farm (Wind Farm).  The Wind Farm, which is now operational, has been the subject of a number of lawsuits by the Osage Nation, the Osage Nation’s Osage Mineral Counsel and the United States, on behalf and at the request of the Osage Nation.  In the most recent lawsuit,¹ the United States sought declaratory and injunctive relief based on an argument that construction of the Wind Farm constituted “mining” of the Osage Nation’s mineral estate.²  The regulations contained in 25 C.F.R. Parts 211 and 214 govern mineral development on tribal lands, and the latter part is devoted specifically to development of the Osage mineral estate.  The district court rejected the United States’ argument that construction of the Wind Farm violated federal law by invading the Nation’s mineral estate without a lease or permit, and ruled that the United States’ interpretation of the regulations would “mean that every proposed construction project in Osage County that requires digging and backfilling, including building a single-family home, multifamily apartment building, commercial building, or septic tank, would be subject to approval by the Osage Nation.”³  The United States did not appeal the order, but on the final day on which an appeal could be filed, the Osage Mineral Counsel intervened for purposes of appeal, arguing that the United States was failing to represent its interests, and has appealed to the Tenth Circuit Court of Appeals.  Future editions of this newsletter will report on the outcome of the ongoing litigation.

Also in Osage County, the United States challenged the development of the Mustang Run Wind Farm, asserting similar legal arguments as against the Osage Wind wind farm.  In the Mustang Run case, the parties stipulated to dismissal of all claims.⁴

Challenges to Regulatory Requirements:

A number of other recent cases have addressed regulatory requirements for development of wind farms.  While these cases do not necessarily involve Indian law, they demonstrate other arguments by opponents of wind energy development.  In Sierra Club v. Bureau of Land Management,⁵ the Ninth Circuit upheld a decision by the United States Bureau of Land Management (BLM) to grant a right of way over federal land to a wind energy project. The proposed right of way would permit a wind farm, developed on private land, to lay, on BLM land, underground power and communication lines connecting the wind farm to the power grid.  After the BLM determined that no endangered species were present in the area where the project would occur and that the project on BLM land would not cause a significant environmental impact, it granted the right of way.  The appellate court ruled that the BLM did not have a duty to consult under the Endangered Species Act because the wind farm was developed on private land and had an option to connect to the grid that did not involve BLM land.  This viable alternative meant that the decision to use a right-of-way on BLM land was a separate project from the development of the wind farm, and thus the wind farm itself was not a “major federal action” requiring consultation under either the Endangered Species Act or the National Environmental Policy Act (NEPA).

In contrast, NEPA review was required when the federal government intended to purchase wind energy.  In Illinois, litigation over the proposed Walnut Ridge Wind Farm, owned by BHE Wind and developed by MG2 Tribal Energy LLC and the Mesa Grande Band of Mission Indians, had reached an agreement to sell the United States General Service Administration (GSA) a majority of the produced energy.  Property owners sued early in 2015, arguing that because the GSA was intending to purchase the energy, federal law required environmental analysis under NEPA before the project could go forward.⁶

The district court agreed, and ordered the GSA to perform a NEPA review on the proposed Wind Farm.  The GSA completed its NEPA review on December 18, and concluded that the Wind Farm would not create the potential for significant adverse impacts and that the GSA’s involvement in the Wind Farm does not constitute a major federal action.  On January 12, 2016, the Bureau County, IL Board granted conditional use permits for 118 turbines, and construction is expected to commence this year.

Take-Aways:

While there remains significant opposition to wind farms, including by Native American Tribes, a number of other Tribes are actively embracing wind energy development.  In recent years, the Cherokee Nation the Passamaquoddy Indian Tribe, the Turtle Mountain Band of Chippewa Indian Reservation,  and the Crow Creek Sioux Tribe all have taken steps toward developing wind farms on Tribal land.  As national and international policies increasingly emphasize development of renewable energy resources, we expect more Native American Tribes to become involved in the wind energy field.

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