NY Court Upholds NY Public Service Commission’s Grant of Permit to South Fork Wind

Offshore wind farmLast week, actions by the Second Department of the New York State Supreme Court Appellate Division set the tone for offshore wind development in New York by denying a challenge brought by local opponents to the NY Public Service Commission’s (“NYPSC”) grant of a Certificate of Environmental Compatibility and Public Need (“CECPN”) for the transmission line needed to interconnect New York State’s first offshore wind project, South Fork Wind, to the mainland grid.  As many have turned to the courts to try to delay or prevent renewable energy projects of all types, this decision will help clear the path for not only New York’s offshore wind industry, but for other renewable energy projects as well.

South Fork Wind’s 7.6-mile New York State transmission line has been contentious since the project’s inception around 2017, largely due to where it makes landfall: Beach Lane in the Town of East Hampton – a self-described bucolic, residential area.  The project quickly garnered staunch (and well-funded) opposition from locals, despite the fact that the transmission line will be sited entirely underground.  The transmission line was largely supported by the local government (due, in part, to the fact that the project came with a $29 million host community benefits package for the Town).  This lawsuit was just one of several unsuccessful court challenges at the State and federal levels to the South Fork Wind project.

As the first offshore wind transmission line to go through New York’s Article VII major transmission facility siting process, South Fork Wind had significant first mover burden as stakeholders knew the process would set precedent for all future offshore wind projects in New York.  This is evidenced by the nearly 200 conditions to its CECPN, many of which dealt with issues never previously considered by the NYPSC.  The conditions run the gamut from submarine cable burial depth, fisheries compensation, construction windows to minimize impact to residents and endangered species, offshore construction techniques, and precautions for handling contaminated soil and water.

After a 2.5 year permitting process before the NYPSC, in which opponents were heavily involved, the NYPSC granted South Fork Wind the CECPN – one of many state and federal permits needed to construct the project.  Opponents unsuccessfully sought rehearing of the NYPSC’s decision, which was decided in August 2021, at which point project opponents sued the NYPSC for its grant of the CECPN, alleging that the agency acted in an arbitrary and capricious manner in granting the permit for the proposed transmission line route, and that the NYPSC did not rely on substantial evidence in the record in making its decision.  The Court dismissed these challenges and upheld the grant of the CECPN.  It is unlikely that this decision will be successfully appealed to the Court of Appeals, and therefore this decision is likely the end of the line for the opponents of the transmission line.

The Court’s decision to uphold the NYPSC’s decision sends a strong signal to other developers (of both offshore wind and other renewable energy projects) in New York and potential project opponents that the bar to challenge the NYPSC’s decisions is high and that New York courts will uphold NYPSC decisions that are justified by the record before them.  This decision demonstrates that a thoughtfully designed and engineered project supported by a robust record can overcome even the most staunch local opposition – paving the way for New York to achieve its goal of 9 GW of offshore wind by 2035.

The challenge to the NYPSC’s grant of the CECPN appeared to be the last legal hurdle that South Fork Wind would need to face, but on May 11, 2023, a group of individuals representing Rhode Island fishing interests filed a notice of intent to sue the Department of Interior, Bureau of Ocean Energy Management, Orsted Offshore North America (one of two entities comprising the joint venture that owns the South Fork Wind project), and the Rhode Island Coastal Resources Management Council, alleging that South Fork Wind is violating the conditions of its permits.

Despite these challenges, South Fork Wind remains on course to become operational by year end 2023, at which point it will be New York’s only offshore wind farm and the first commercial-scale project in federal waters.  The Court’s actions last week represent a major decision that not only helped to secure South Fork Wind’s future, but also sets the precedent for the entire offshore wind industry.

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