Title of Regulation: 9VAC15-40. Small Renewable Energy Projects (Wind) Permit by Rule (amending 9VAC15-40-10, 9VAC15-40-20, 9VAC15-40-110, 9VAC15-40-120, 9VAC15-40-130).

Statutory Authority: § 10.1-1197.6 of the Code of Virginia.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: July 15, 2015.

Effective Date: July 30, 2015.

Agency Contact: Mary E. Major, Department of Environmental Quality, 629 East Main Street, P.O. Box 1105, Richmond, VA 23218, telephone (804) 698-4423, FAX (804) 698-4510, or email mary.major@deq.virginia.gov.

Basis: Sections 10.1-1197.5 through 10.1-1197.11 of the Code of Virginia authorize the Department of Environmental Quality (DEQ) to promulgate regulations that provide permitting requirements to protect Virginia's natural resources that may be affected by the construction and operation of small renewable wind energy projects.

Purpose: The amendments are a result of a periodic review and are required for consistency between the other permit by rule (PBR) regulations (solar and combustion) required under Article 5 (§ 10.1-1197.5 et seq.) of Chapter 11.1 of Title 10.1 of the Code of Virginia. This consistency will benefit the general public health and welfare. Section 10.1-1197.5 of the Code provides permitting requirements to protect Virginia's natural and historic resources that may be affected by the construction and operation of small renewable wind, solar, or combustion energy projects.

Rationale for Using Fast-Track Process: The amendments add language to ensure consistency with the solar and combustion small renewable energy project PBRs. All of the changes were thoroughly vetted during the regulation adoption process for both the solar and combustion PBRs, which were promulgated after the wind PBR. Therefore, no comments regarding the changes to this chapter are anticipated.

Substance: The technical changes to the wind PBR include the following:

1. Adding language regarding payment of fees for small renewable wind energy projects in Virginia,

2. Adding a statement to clarify that wind projects under five megawatts (MW) are considered covered by the PBR, and

3. Making technical changes to one definition and corrections to citations in the sections dealing with Internet resources and documents incorporated by reference.

Issues: The general public health and welfare will benefit because the revision ensures consistency for permitting requirements for small wind renewable energy projects greater than five MW but equal or less than 100 MW with requirements for solar and combustion renewable projects of similar size. This consistency in permitting requirements is necessary to ensure uniform protection of historic and natural resources while encouraging the development of renewable energy. The amendments allow the department to expedite the permitting of small renewable wind energy projects in a streamlined way while ensuring the protection of historic and natural resources of the Commonwealth.

Small Business Impact Review Report of Findings: This regulatory action serves as the report of the findings of the regulatory review pursuant to § 2.2-4007.1 of the Code of Virginia.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The Department of Environmental Quality (Department) proposes to: 1) amend the definition of small wind energy project to remove the clause "whose main purpose is to supply electricity," 2) add a statement to clarify that wind projects under five megawatts are considered to be covered by the permit by rule (PBR), 3) add language allowing fees to be paid electronically when the Department is able to accept electronic payments, and 4) update citations and links in the section pertaining to internet accessible resources.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. The Department proposes to remove the clause "whose main purpose is to supply electricity," from the definition of small wind energy project in order to clarify that projects that are not selling electricity to the grid would also be eligible for a permit under the PBR. Though this is not intended to be a change in policy, it may be beneficial in that the clarification may moderately increase the likelihood that environmentally friendly wind energy projects are initiated. Adding a statement to clarify that wind projects fewer than five megawatts are considered to be covered by the PBR will be similarly beneficial.

The proposal to allow fees to be paid electronically when the Department is able to accept electronic payments is beneficial in that it can save staff time for both potential permittees and the Department.

Businesses and Entities Affected. The proposed amendments affect individuals, businesses or other entities wishing to develop a small wind energy project of 100 MW or less. Currently there are no such projects in the Commonwealth.¹

Localities Particularly Affected. The proposed regulation applies statewide and is not designed to have a disproportionate material impact on any particular locality. As a practical matter, however, wind-energy projects will be located where adequate wind conditions exist (generally Class 3 winds or higher for commercial-scale projects).²

Projected Impact on Employment. To the extent that the proposed clarifying language might encourage the pursuit of small wind energy projects in the Commonwealth, there may be a small increase in affiliated jobs.

Effects on the Use and Value of Private Property. The proposed clarifying language could potentially moderately increase the likelihood that a firm would pursue a small wind energy project.

Small Businesses: Costs and Other Effects. None of the proposed amendments increase costs for small businesses. The proposal to allow fees to be paid electronically when the Department is able to accept electronic payments could save a small amount of staff time for small businesses that start a small wind energy project.

Small Businesses: Alternative Method that Minimizes Adverse Impact. The proposed amendments will not create an adverse impact for small businesses.

Real Estate Development Costs. The proposed amendments will not significantly affect real estate development costs.

Legal Mandate. General: The Department of Planning and Budget (DPB) has analyzed the economic impact of this proposed regulation in accordance with § 2.2-4007.04 of the Code of Virginia and Executive Order Number 17 (2014). Section 2.2-4007.04 requires that such economic impact analyses determine the public benefits and costs of the proposed amendments. Further the report should include but not be limited to:

• the projected number of businesses or other entities to whom the proposed regulatory action would apply,

• the identity of any localities and types of businesses or other entities particularly affected,

• the projected number of persons and employment positions to be affected,

• the projected costs to affected businesses or entities to implement or comply with the regulation, and

• the impact on the use and value of private property.

Small Businesses: If the proposed regulatory action will have an adverse effect on small businesses, § 2.2-4007.04 requires that such economic impact analyses include:

• an identification and estimate of the number of small businesses subject to the proposed regulation,

• the projected reporting, recordkeeping, and other administrative costs required for small businesses to comply with the proposed regulation, including the type of professional skills necessary for preparing required reports and other documents,

• a statement of the probable effect of the proposed regulation on affected small businesses, and

• a description of any less intrusive or less costly alternative methods of achieving the purpose of the proposed regulation.

Additionally, pursuant to § 2.2-4007.1, if there is a finding that a proposed regulation may have an adverse impact on small business, the Joint Commission on Administrative Rules is notified at the time the proposed regulation is submitted to the Virginia Register of Regulations for publication. This analysis shall represent DPB's best estimate for the purposes of public review and comment on the proposed regulation.

______________________________

¹ Source: Department of Environmental Quality

² Ibid

Agency's Response to Economic Impact Analysis: The Department of Environmental Quality has reviewed the economic impact analysis prepared by the Department of Planning and Budget and has no comment.

Summary:

The amendments (i) modify the definition of the term "small wind energy project," (ii) clarify that wind projects under five megawatts are considered covered by the regulation, (iii) allow fees to be paid electronically when the Department of Environmental Quality is able to accept electronic payments, and (iv) update citations and links.

Part I
Definitions and Applicability

9VAC15-40-10. Definitions.

The following words and terms when used in this chapter shall have the following meanings unless the context clearly indicates otherwise:

"Applicant" means the owner or operator who submits an application to the department for a permit by rule pursuant to this chapter.

"Coastal Avian Protection Zones" or "CAPZ" means the areas designated on the map of "Coastal Avian Protection Zones" generated on the department's Coastal GEMS geospatial data system (9VAC15-40-120 C 1).

"Department" means the Department of Environmental Quality, its director, or the director's designee.

"DCR" means the Department of Conservation and Recreation.

"DGIF" means the Department of Game and Inland Fisheries.

"Disturbance zone" means the area within the site directly impacted by construction and operation of the wind energy project, and within 100 feet of the boundary of the directly impacted area.

"Ecological core" means an area of nonfragmented forest, marsh, dune, or beach of ecological importance that is at least 100 acres in size and identified in DCR's Natural Landscape Assessment web-based application (9VAC15-40-120 C 2).

"Historic resource" means any prehistoric or historic district, site, building, structure, object, or cultural landscape that is included or meets the criteria necessary for inclusion in the Virginia Landmarks Register pursuant to the authorities of § 10.1-2205 of the Code of Virginia and in accordance with 17VAC5-30-40 through 17VAC5-30-70.

"Important Bird Areas" means the designation of discrete sites by the National Audubon Society as having local, regional, continental, or global importance for birds because they support significant numbers of one or more high priority avian species (e.g., T&E, SGCN) during the breeding, wintering, or migration seasons.

"Interconnection point" means the point or points where the wind energy project connects to a project substation for transmission to the electrical grid.

"Invasive plant species" means non-native plant species that cause, or are likely to cause, economic or ecological harm or harm to human health as established by Presidential Executive Order 13112 (64 FR 6183, February 3, 1999) and contained on DCR's Invasive Alien Plant Species of Virginia (9VAC15-40-120 B 3).

"Migratory corridors" means major travel routes used by significant numbers of birds during biannual migrations between breeding and wintering grounds.

"Migratory staging areas" means those sites along migratory corridors where significant numbers of birds stop to feed and rest during biannual migrations between breeding and wintering grounds that are essential to successful migration.

"Natural heritage resource" means the habitat of rare, threatened, or endangered plant and animal species, rare or state significant natural communities or geologic sites, and similar features of scientific interest benefiting the welfare of the citizens of the Commonwealth.

"Nearshore waters" means all tidal waters within the Commonwealth of Virginia and seaward of the mean low-water shoreline to three nautical miles offshore in the Atlantic Ocean.

"Operator" means the person responsible for the overall operation and management of a wind energy project.

"Other avian mitigation factors" means Important Bird Areas, migratory corridors, migratory staging areas, and wintering areas within the Coastal Avian Protection Zones.

"Owner" means the person who owns all or a portion of a wind energy project.

"Permit by rule" means provisions of the regulations stating that a project or activity is deemed to have a permit if it meets the requirements of the provision.

"Person" means any individual, partnership, firm, association, joint venture, public or private corporation, trust, estate, commission, board, public or private institution, utility, cooperative, county, city, town, or other political subdivision of the Commonwealth, any interstate body, or any other legal entity.

"Phase of a project" means one continuous period of construction, startup, and testing activity of the wind energy project. A phase is deemed complete when 90 calendar days have elapsed since the last previous wind turbine has been placed in service, except when a delay has been caused by a significant force majeure event, in which case a phase is deemed complete when 180 calendar days have elapsed since the last previous wind turbine has been placed in service.

"Post-construction" means any time after the last turbine on the wind energy project or phase of that project has been placed in service.

"Pre-construction" means any time prior to commencing land-clearing operations necessary for the installation of energy-generating structures at the small wind energy project.

"Rated capacity" means the maximum capacity of a wind energy project based on the sum total of each turbine's nameplate capacity.

"SGCN" or "species of greatest conservation need" means any vertebrate species so designated by DGIF as Tier 1 or Tier 2 in the Virginia Wildlife Action Plan (9VAC15-40-120 B 6).

"Site" means the area containing a wind energy project that is under common ownership or operating control. Electrical infrastructure and other appurtenant structures up to the interconnection point shall be considered to be within the site.

"Small renewable energy project" means (i) an electrical generation facility with a rated capacity not exceeding 100 megawatts that generates electricity only from sunlight, wind, falling water, wave motion, tides, or geothermal power, or (ii) an electrical generation facility with a rated capacity not exceeding 20 megawatts that generates electricity only from biomass, energy from waste, or municipal solid waste.

"Small wind energy project," "wind energy project," or "project" means a small renewable energy project that (i) generates electricity from wind, whose main purpose is to supply electricity, consisting of one or more wind turbines and other accessory structures and buildings, including substations, post-construction meteorological towers, electrical infrastructure, and other appurtenant structures and facilities within the boundaries of the site; and (ii) is designed for, or capable of, operation at a rated capacity equal to or less than 100 megawatts. Two or more wind energy projects otherwise spatially separated but under common ownership or operational control, which are connected to the electrical grid under a single interconnection agreement, shall be considered a single wind energy project. Nothing in this definition shall imply that a permit by rule is required for the construction of meteorological towers to determine the appropriateness of a site for the development of a wind energy project.

"State-owned submerged lands" means lands that lie seaward of the mean low-water mark in tidal waters or that have an elevation below the ordinary mean high-water elevation in nontidal areas that are considered property of the Commonwealth pursuant to § 28.2-1200 of the Code of Virginia.

"T&E," "state threatened or endangered species," or "state-listed species" means any wildlife species designated as a Virginia endangered or threatened species by DGIF pursuant to the § 29.1-563-570 §§ 29.1-563 through 29.1-570 of the Code of Virginia and 4VAC15-20-130.

"VLR" means the Virginia Landmarks Register (9VAC15-40-120 B 1).

"VLR-eligible" means those historic resources that meet the criteria necessary for inclusion on the VLR pursuant to 17VAC5-30-40 through 17VAC5-30-70 but are not listed in VLR.

"VLR-listed" means those historic resources that have been listed in the VLR in accordance with the criteria of 17VAC5-30-40 through 17VAC5-30-70.

"VMRC" means the Virginia Marine Resources Commission.

"Wildlife" means wild animals; except, however, that T&E insect species shall only be addressed as part of natural heritage resources and shall not be considered T&E wildlife.

"Wintering areas" means those sites where a significant portion of the rangewide population of one or more avian species overwinter annually.

9VAC15-40-20. Authority and applicability.

This regulation is issued under authority of Article 5 (§ 10.1-1197.5 et seq.) of Chapter 11.1 of Title 10.1 of the Code of Virginia. The regulation contains requirements for wind-powered electric generation projects consisting of wind turbines and associated facilities with a single interconnection to the electrical grid that are designed for, or capable of, operation at a rated capacity equal to or less than 100 megawatts. The department has determined that a permit by rule is required for small wind energy projects with a rated capacity greater than 5 five megawatts and this regulation contains the permit by rule provisions for these projects in Part II (9VAC15-40-30 et seq.) of this chapter. The department has also determined that a permit by rule is not required for small wind energy projects with a rated capacity of 5 five megawatts or less and this regulation contains notification and other provisions for these projects in Part III (9VAC15-40-130) of this chapter. Projects that meet the criteria in Part III of this chapter are deemed to be covered by the permit by rule.

9VAC15-40-110. Fees.

A. Purpose. The purpose of this section is to establish schedules and procedures pertaining to the payment and collection of fees from any applicant seeking a new permit by rule or a modification to an existing permit by rule for a small wind energy project.

B. Permit fee payment and deposit. Fees for permit by rule applications or modifications shall be paid by the applicant as follows:

1. Due date. All permit application fees or modification fees are due on submittal day of the application or modification package.

2. Method of payment. Fees shall be paid by check, draft, or postal money order made payable to "Treasurer of Virginia/DEQ" and shall be sent to the Department of Environmental Quality, Receipts Control, P.O. Box 1104, Richmond, VA 23218. When the department is able to accept electronic payments, payments may be submitted electronically.

3. Incomplete payments. All incomplete payments shall be deemed nonpayments.

4. Late payment. No application or modification submittal will be deemed complete until the department receives proper payment.

C. Fee schedules. Each application for a permit by rule and each application for a modification of a permit by rule is a separate action and shall be assessed a separate fee. The amount of the permit application fee is based on the costs associated with the permitting program required by this chapter. The fee schedules are shown in the following table:

Type of Action	Fee
Permit by rule application (including first three years of operation)	$16,000
Permit by rule modification (after first three years of operation)	$5,000

D. Use of fees. Fees are assessed for the purpose of defraying the department's costs of administering and enforcing the provisions of this chapter including, but not limited to, permit by rule processing, permit by rule modification processing, and inspection and monitoring of small wind energy projects to ensure compliance with this chapter. Fees collected pursuant to this section shall be used for the administrative and enforcement purposes specified in this section and in § 10.1-1197.6 E of the Code of Virginia.

E. Fund. The fees, received by the department in accordance with this chapter, shall be deposited in the Small Renewable Energy Project Fee Fund.

F. Periodic review of fees. Beginning July 1, 2012, and periodically thereafter, the department shall review the schedule of fees established pursuant to this section to ensure that the total fees collected are sufficient to cover 100% of the department's direct costs associated with use of the fees.

9VAC15-40-120. Internet accessible resources.

A. This chapter refers to resources to be used by applicants in gathering information to be submitted to the department. These resources are available through the Internet; therefore, in order to assist the applicants, the uniform resource locator or Internet address is provided for each of the references listed in this section.

B. Internet available resources.

1. The Virginia Landmarks Register, Virginia Department of Historic Resources, 2801 Kensington Avenue, Richmond, Virginia. Available at the following Internet address: http://www.dhr.virginia.gov/registers/register.htm http://www.dhr.virginia.gov.

2. Professional Qualifications Standards, the Secretary of the Interior's Standards and Guidelines for Archeology and Historic Preservation, as amended and annotated (48 FR 44716-740, September 29, 1983), National Parks Service, Washington, DC. Available at the following Internet address: http://www.nps.gov/history/local-law/arch_stnds_9.htm.

3. Invasive alien plant species of Virginia, Virginia Department of Conservation and Recreation, Division of Natural Heritage, Richmond, Virginia. Available at the following Internet address: http://www.dcr.virginia.gov/natural_heritage/invspinfo.shtml http://www.dcr.virginia.gov.

4. The Natural Communities of Virginia, Classification of Ecological Community Groups, Second Approximation, Version 2.3, 2010, Virginia Department of Conservation and Recreation, Division of Natural Heritage, Richmond, VA. Available at the following Internet address: http://www.dcr.virginia.gov/natural_heritage/ncintro.shtml http://www.dcr.virginia.gov.

5. Virginia Outdoors Plan, 2007, Virginia Department of Conservation and Recreation, Richmond, Virginia. Available at the following Internet address: http://www.dcr.virginia.gov/recreational_planning/vop.shtml http://www.dcr.virginia.gov.

6. Virginia's Comprehensive Wildlife Conservation Strategy, 2005 (referred to as the Virginia Wildlife Action Plan), Virginia Department of Game and Inland Fisheries, 4010 West Broad Street, Richmond, Virginia. Available at the following Internet address: http://www.bewildvirginia.org/wildlifeplan/ http://www.bewildvirginia.org.

C. Internet applications.

1. Coastal GEMS application, 2010, Virginia Department of Environmental Quality. Available at the following Internet address: http://www.deq.virginia.gov/coastal/coastalgems.html http://www.deq.virginia.gov.

NOTE: This website is maintained by the department. Assistance and information may be obtained by contacting Virginia Coastal Zone Management Program, Virginia Department of Environmental Quality, 629 E. East Main Street, Richmond, Virginia 23219, (804) 698-4000.

2. Virginia Natural Landscape Assessment (VaNLA), 2010, Virginia Department of Conservation and Recreation. Available at the following Internet address: for detailed information on ecological cores go to http://www.dcr.virginia.gov/natural_heritage/vclnavnla.shtm http://www.dcr.virginia.gov/natural_heritage. Land maps may be viewed at DCR's Land Conservation Natural Heritage Data Explorer Geographic Information System (NHDE) website at http://www.vaconservedlands.org/gis.aspx https://www.vanhde.org.

NOTE: The NHDE website is maintained by DCR. Actual shapefiles and metadata for publicly-available data on NHDE are available for free of charge by contacting a DCR staff person at vaconslands@dcr.virginia.gov or DCR, Division of Natural Heritage, 217 Governor Street 600 East Main Street, 24th Floor, Richmond, Virginia 23219, (804) 786-7951.

3. Virginia Fish and Wildlife Information Service, 2010, Virginia Department of Game and Inland Fisheries. Available at the following Internet address: http://www.vafwis.org/fwis/.

NOTE: This website is maintained by DGIF and is accessible to the public as "visitors" or to registered subscribers. Registration, however, is required for access to resource-specific or species-specific locational data and records. Assistance and information may be obtained by contacting DGIF, Fish and Wildlife Information Service, 4010 West Broad Street, Richmond, Virginia 23230 7870 Villa Park Drive, Suite 400, Henrico, VA 23228, (804) 367-6913.

Part III
Notification and Other Provisions for Projects of 5 Five Megawatts or Less

9VAC15-40-130. Small wind energy projects of 5 five megawatts or less.

A. The owner or operator of a small wind energy project with a rated capacity equal to or less than 500 kilowatts is not required to submit any notification or certification to the department.

B. The owner or operator of a small wind energy project with a rated capacity greater than 500 kilowatts and equal to or less than 5 five megawatts shall:

1. Notify the department by submitting and submit a certification by the governing body of the locality or localities wherein the project will be located that the project complies with all applicable land use ordinances and applicable local government requirements; and

2. For projects located in part or in whole within zones 1, 2, 3, 4, 5, 10, 11, 12, or 14 on the Coastal Avian Protection Zones (CAPZ) map, contribute $1,000 per megawatt of rated capacity, or partial megawatt thereof, to a fund designated by the department in support of scientific research investigating the impacts of projects in CAPZ on avian resources.