Tuesday, November 21, 2017

Judith V. Royster

Excerpted from: Judith V. Royster, Tribal Energy Development: Renewables and the Problem of the Current Statutory Structures, 31 Stanford Environmental Law Journal 91 (March, 2012) (205 Footnotes Omitted)

Energy development is the economic lifeblood of many Indian tribes. A number of tribal economies are heavily dependent upon fossil fuel extraction, and for many tribes, fossil fuels are the single greatest source of tribal revenue.

Indian lands contain extensive reserves of fossil fuels and other energy minerals: three to four percent of known oil and gas reserves, up to thirty percent of the coal west of the Mississippi, and approximately one third of the country's uranium resources. Over 2.7 million acres of Indian lands support more than 4800 producing mineral leases, almost all of which are for oil and gas. Production on Indian lands represents 5% of domestic oil production, 8% of natural gas production, and 2% of coal production. Royalties exceed $542 million, the vast majority of which are generated by oil, gas, and coal production. All told, Indian lands account for more than ten percent of federal on-shore energy production. Moreover, the Department of the Interior estimates that 15 million additional acres of energy resources on Indian lands, containing some 5 billion barrels of oil, 37 trillion cubic feet of natural gas, and 53 billion tons of coal that are technically recoverable with current technologies, lie undeveloped.

Renewable energy resources on Indian lands are similarly abundant. Several dozen tribes have lands suitable for wind power development, and a number of other tribes possess geothermal resources and opportunities for solar development. Biomass potential is even more widespread, with the Department of the Interior identifying 118 reservations with a high potential of producing biomass.

Renewable energy resources are taking on increasing importance for both Indian tribes and the nation as a whole. A variety of factors has sparked the current national interest in renewable energy, including energy independence and security, climate change, and increasing energy prices. Indian tribes share these interests, but bear some disproportionate consequences. Tribes have historically benefitted less from the extraction of fossil fuels from tribal lands than their non-Indian lessees and the states. The effects of climate change and other negative impacts of extractive resource industries may hit tribes especially hard, particularly because their cultural and economic well-being is intimately connected to the place of the tribe's homeland. In addition, the economic value of extractive industries fluctuates dramatically, as indicated by a significant drop in tribal royalties from fossil fuels in fiscal years 2009 and 2010.

Despite the central importance of energy production for many tribes, very few engage directly in energy development. Far more commonly, energy tribes partner with, or even depend upon, non-Indian companies for exploration, extraction, and processing. The presence of non-Indian companies, in turn, triggers application of the Nonintercourse Act and the necessity of federal statutory authority for energy development activities.

Current statutory authority works reasonably well for the development of traditional extractive mineral resources. Tribes have the opportunity to enter into virtually any type of development deal that suits their needs, although most mineral deals are still subject to approval by the Secretary of the Interior. The statutory scheme, however, is less than ideal for the development of renewable energy resources. The mineral development statutes offer great flexibility, but the uncertainty of whether all energy sources are minerals impedes the statutes' usefulness for renewable energy projects. A variety of other federal laws are available for renewables development, but none applies to all renewable energy sources and all have limits on what role the tribes may take in the development process. The recent Indian Tribal Energy Development and Self-Determination Act (ITEDSA) appears to solve the issues posed by the other statutes, but it has so far proven unattractive to energy tribes.

This Article discusses the range of current statutes and the problems attendant on using them for renewable energy development: the definitional issue in using the mineral statutes, the passive role assigned to tribes in the other statutes, and why ITEDSA, designed to resolve these issues, has not worked. Recent congressional initiatives to broaden tribal options are then surveyed and critiqued. The Article concludes with some suggestions to ease the process of tribal renewable energy development and allow tribes to take more active roles in that development.

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