Wind Energy Fuels Legal Questions

Wind Energy Fuels Legal Questions

By Miguel Suazo and Chelsea Allen

In recent years, renewables have fostered not only cleaner energy production but also a slew of new legal issues. The wind energy boom and the revenue derived from wind power has created a new set of legal questions affecting property rights. For example, the question of whether there is a severable and legally recognizable “wind estate,” remains an open question in many jurisdictions.

Subsurface mineral estates have long been severable from the surface estate, and the law concerning those estates is relatively well settled. “Wind rights,” on the other hand, is a comparatively new concept that has yet to be consistently spelled out in the law. The question of whether a severable wind estate exists affects property owners’ ability to transfer and devise their rights to the wind above their properties. In Texas, for example, the question (technically, at least) remains undecided. While many deeds have been and continue to be executed in Texas as though a legally recognized and severable wind estate exists and can be transferred, neither the Texas legislature nor the Texas courts have yet addressed this issue. Accordingly, there is still a significant level of uncertainty concerning wind rights in Texas.

By contrast, the Colorado legislature has affirmatively settled the matter by declaring that the rights to wind energy are non-severable. According to a 2012 Colorado law, “A wind energy right is not severable from the surface estate but, like other rights to use the surface estate, may be created, transferred, encumbered, or modified by agreement.” Colo. Rev. Stat. Ann. § 38-30.7-103 (West).

While its statute limits somewhat the transferability of wind rights, Colorado’s approach at least simplifies the legal questions. If wind rights are not severable from the surface estate, then they simply run with the surface, making them far easier to track. Another benefit of the Colorado approach is that it avoids the legal conundrum currently plaguing other states regarding which estate should be the dominant one (if a “wind estate” exists in addition to a surface and mineral estate).

Currently, for example, the mineral (or subsurface) estate is generally recognized as the dominant estate over the surface estate, at least in most oil and gas producing states. This is because, as a general matter, possession of the subsurface estate includes an implied right to use the surface to access those minerals. Most jurisdictions that lack case law on the question, or whose legislatures have not yet addressed the “wind estate” issue, must consider this associated question in their analysis. While Colorado’s legislative approach may have settled the question for its own landowners, we have yet to see which jurisdictions will follow suit. Until then, wind energy will fuel more legal questions than answers. Check back frequently for updates as we continue to monitor developments in U.S. wind law.

CONTACT MIGUEL SUAZO AT (505)-375-1400 OR BY EMAIL AT mas@suazolegalgroup.com WITH ANY LEGAL QUESTIONS REGARDING WIND RIGHTS AND ENERGY PRODUCTION IN TEXAS, NEW MEXICO, OR COLORADO.

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