Occasionally, title or environmental issues make the contiguous parcel infeasible for collection or transmission line construction. Projects are often left with gaps in their site control that need to be accounted for, particularly when that gap affects collection and transmission routes. For example, if a landowner refuses to take part in a project where their property abuts the point of interconnection, the project needs an alternate way to reach the point of interconnection.

One way developers navigate these scenarios is by using public rights of way, most commonly a road, for their collection and transmission routes. In the example above, if the point of interconnection abutted a public right of way—a county road for example—then the project could feasibly run its collection or transmission line along the shoulder of the county road to access the substation parcel, thus avoiding the non-participating landowner entirely. However, developers should be cautious when looking to use public rights of way, as state law is not always clear on independent power producers’ (“IPPs”) ability to do so, and uncertainty in the rights held by the project may concern financing parties and could result in challenges by private landowners during construction.

In short, whether an IPP can use public rights of way to lay infrastructure depends on two primary questions. First, do the governmental entity’s roadway rights provide enough land for the IPP to safely build and maintain the infrastructure, or are additional easements from private landowners also necessary? And second, if the roadway land is sufficient, does the governmental entity have the proper authority to grant the IPP those rights? Both of these questions require thorough research of state law and careful risk assessment in the event that state law is either silent or ambiguous on either topic.

For instance, if a county has acquired a county road by public dedication from a prior landowner “for the right to use the right of way for public use and enjoyment,” then the legal question becomes whether running infrastructure like a transmission or collection line through the public right of way would qualify as “public use and enjoyment” and thus be within the scope of the rights held by the county. This analysis can become particularly nuanced with respect to IPPs because, although the electricity generated does flow on to the grid and therefore make its way to the public, an IPP is not typically considered a public utility under state law. Most public utilities have certain inherent rights to use the public rights of way for utility line placement or to apply for and receive such rights (through the grant of franchises or certificates of need and necessity). Additionally, if the rights were obtained by condemnation, there may be additional restrictions prohibiting the governmental entity from granting private companies, including IPPs, the right to use public rights of way.

One example of how this analysis can play out can be seen in Indiana. Under Indiana law, public rights of way obtained by express grant are generally considered to be easements, held in trust by the governmental entity named as the grantee for the benefit of the public. Included in this grant of rights, governmental entities in Indiana may devote a public right of way to other purposes useful and convenient to the public—including occupation by public utilities. Additionally, governmental entities are granted the right to regulate the procedures by which public utilities are allowed to occupy public rights of way.

A public utility able to occupy public rights of way in Indiana includes any corporation that owns, operates, manages, or controls any equipment for the production, transmission, or delivery of electricity—which is broad enough to include IPPs. Even the Indiana Utility Regulatory Commission (“IURC”) refers to this in its orders, often specifically reserving a paragraph to state that, although the IURC is declining jurisdiction over an IPP, the IPP nonetheless retains its right to use public rights of way. Thus, Indiana has a relatively robust set of cases and statutes on point that make the analysis of an IPP’s use of public rights of way straight forward, though the ultimate answer will still depend on project-specific facts.

In a contrasting example, Kentucky presents a much murkier analysis. Under Kentucky law, public rights of way come in different forms and require much more in-depth analysis. For example, if a public right of way is merely a “public road,” the right of way is considered to be held by and for the benefit of the public. Since the governmental entity holds no interest in a public road by virtue of it being “owned” by the public, it cannot grant an IPP the right to use the public right of way because it has no rights to grant.

Even if a public right of way were considered a “county road” such that the county would have jurisdiction over the road and could grant an IPP the right to use the public right of way, developers must still take into account the language used in the grant to the county itself. The rights inherent in a Kentucky public right of way are very fact specific, such that the granting language can make or break an IPP’s use. For example, if the granting language to a governmental entity stated that the public right of way was an easement “for the purposes of a roadway for public travel,” then an IPP’s proposed use of a public right of way likely would not work because generation of electricity would almost certainly not be considered “for public travel.”

Alternatively, if the granting language to a governmental entity was in fee simple for use as a roadway, the governmental entity may be able to allow an IPP to use the public right of way, provided such use does not interfere with the public’s use. In summary, Kentucky’s scheme for analyzing the possibility of using public rights of way is much more nuanced and fact-specific than a state like Indiana.

Conclusion

As the above examples describe, using public rights of way for infrastructure siting can present unique, nuanced, and complex challenges such that, in many cases, developers will lean toward landowner participation as the primary means of obtaining contiguous site control.

Understanding the specific laws and regulations of each state are crucial for developers to make informed and strategic decisions about their project’s site plans. And while it may be the case that a given state has a relatively well laid-out scheme for using public rights of way like Indiana, it could also be the case that the state has a unique and challenging approach to public rights of way, like Kentucky.

Careful legal and factual analysis are necessary to determine whether using public rights of way is feasible for a given project, and while it can remain a potential backup plan when contiguous site control cannot be obtained, landowner participation should almost always be the first route pursued.

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