Bureau of Land Management Solar Energy Program Western Solar Plan
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Due Diligence—Applicant Qualifications

As part of a solar energy application, applicants must include information on their company’s financial and technical capability to construct, operate, maintain, and decommission the project.

The right-of-way (ROW) regulations (43 CFR 2804.12(a)(5)) require all solar energy applications to include information on the financial and technical capability of the applicant to construct, operate, maintain, and decommission the proposed solar energy facility. The regulations (43 CFR 2804.26(a)(5)) provide authority to the BLM to deny any application in which the applicant cannot demonstrate the technical or financial capability to construct the project or operate the facilities within the ROW.

The ROW regulations set forth the qualifications that an individual, business, or government entity must possess in order to hold a ROW authorization, including the requirement that the potential grantee be technically and financially able to construct, operate, maintain, and decommission the use of the public lands covered by the authorization (43 CFR 2803.10(b) and 2804.12(a)(5)). In carrying out its obligation to limit ROW authorizations to qualified individuals or entities and to prevent such individuals or entities from holding ROW authorizations merely for the purposes of speculating, controlling, or hindering development on the public lands, the BLM will focus on ensuring that the applicant meets the qualification requirements in the regulations.

In ensuring that an applicant meets the regulatory requirement to demonstrate its technical and financial capability to construct, operate, maintain, and decommission the proposed solar energy facility (43 CFR 2803.10(b) and 43 CFR 2804.12(a)(5)), the BLM will consider a variety of factors, including the following:

  1. Applicant qualifications can be demonstrated by international or domestic experience with utility-scale renewable energy projects on either Federal or nonfederal lands;
  2. The applicant should provide information on the availability of sufficient capitalization to carry out development, including the preliminary study phase of the project and the environmental review and clearance process; and
  3. Applicants in bankruptcy or with other financial difficulties would generally present financial risk and would be required to provide additional information regarding financial capability.

Failure to provide such additional information can be the basis for the BLM authorized officer to deny the application pursuant to the regulations (43 CFR 2804.26(a)(5)). Further evidence of financial and technical capability can include conditional commitments of U.S. Department of Energy (DOE) loan guarantees; a confirmed Power Purchase Agreement; engineering, procurement, and construction contracts; and supply contracts with credible third-party vendors for the manufacture and/or supply of key components for the solar energy project facilities.

During the assessment of technical and financial capability, the BLM authorized officer should also inform applicants that such requirements are continuous during the application process, and the BLM may periodically seek confirmation of these requirements. The BLM authorized officer should also inform applicants that such technical and financial capability will become a condition of any ROW authorization, and failure to sustain technical and financial capability for the development of an approved project could be grounds for termination of the authorization.

Updated: 6/19/2013