US BLM 43 CFR 2806: Solar Rights-of-Way Rent & Capacity Fees Guide

Key Takeaways

• Under 43 CFR Part 2800 Subpart 2806 (§ 2806.50 and § 2806.52), holders of solar energy rights-of-way on federal public lands must pay the greater of an annual acreage rent or a capacity fee.
• Acreage rent is determined by multiplying authorized acreage by the annual per-acre rate calculated via formula A × B × [(1 + C) ^ D].
• The formula applies a 100 percent encumbrance factor (B) for solar energy, a fixed 3 percent annual adjustment factor (C), and a 5-year NASS pastureland average baseline (A).
• The capacity fee is assessed at 3.9 percent of the project's annual gross proceeds from wholesale electricity sales.
• Hybrid public-private projects prorate generation fees based on the proportion of the right-of-way footprint on public lands relative to the total project area.

Statutory Authority & Payment Scope

Under the Federal Land Policy and Management Act (FLPMA) and regulations codified at 43 CFR Part 2800 (Subpart 2806), the Bureau of Land Management (BLM) oversees annual payment obligations for utility-scale solar installations on federal public lands.

Pursuant to 43 CFR § 2806.50, solar developers must submit annual payments representing the greater of the calculated acreage rent or the capacity fee. Current acreage rent schedules are administered by the BLM Renewable Energy Coordination Office.

Acreage Rent Calculation Formula & Variables

Under 43 CFR § 2806.52(a), the BLM calculates annual acreage rent by multiplying total authorized acres (rounded up to the nearest tenth of an acre) by the per-acre rate:

$$\text{Annual Per-Acre Rate} = A \times B \times [(1 + C) ^ D]$$

Authorized acreage is multiplied by this derived rate to determine the baseline acreage rent due for the operating year.

Gross Proceeds Capacity Fee & Proration Rules

Under 43 CFR § 2806.52(b), developers calculate the alternative capacity fee:

• Assessment Rate: Evaluated as 3.9 percent of annual gross proceeds received from wholesale electricity sales generated by the facility.
• Due Date: Assessed annually and payable in the calendar year following the electricity production year.
• Public Land Proration: For facilities that incorporate both public and private lands, total generation is prorated strictly by the percentage of the right-of-way footprint located on public lands relative to the overall project footprint.