Energy & Natural Resources
The Jones Act, which requires that components moved between points in the United States be transported on US-flagged and crewed vessels, has long been a point of focus for the offshore wind sector. Historically however there's been uncertainty around the extent to which the Jones Act applies to offshore wind industry operations on the Outer Continental Shelf (OCS) beyond US territorial waters.
One grey area exists in the Outer Continental Shelf Lands Act, which extends US federal law and jurisdiction to parts of the OCS, including fixed structures used for oil and mineral extraction, but which is silent as to structures used for wind energy generation.
The amendment just passed by the House of Representatives would clarify that the Outer Continental Shelf Lands Act extends US federal law and jurisdiction (including the Jones Act) to installations on the OCS whose purpose is the "production of energy from sources other than oil and gas." That would clarify the application of the Jones Act to movements of components between a US port and wind installation sites on the OCS.
Of course, passage by the House of Representatives does not give the amendment effect until it has been approved by both houses of Congress and signed into law by the President. We have been here before: the House passed a similar amendment in 2011 which did not make it through the U.S. Senate. The present bill is also likely to face an uphill battle in the Senate as currently constituted. Many in the industry, including the offshore wind team here at Clyde & Co, will still be closely monitoring how this latest amendment progresses!
Written by George Cornell, Senior Counsel, US, and John Dowlman, Senior Associate, UK