Oceti Sakowin Power Authority: How a Six-Tribe Coalition Is Defining a New and Bigger Business Model

With a massive wind power project, Tribes in South Dakota are raising the stakes for energy production on Tribal lands. The Oceti Sakowin Power Authority (OSPA) is a joint venture of six Sioux nations that has pulled in unprecedented startup funding without sacrificing economic sovereignty.

The Tribes are looking to use their land’s natural resources — wind, specifically — to generate significant electrical power. The project will bring revenue to the various Sioux peoples who are participating, as well as economic stimulus to the Tribal territories, which are situated in some of the poorest counties in the nation.

The best part about OSPA? The Sioux own it.

***

The idea of a wind farm on Sioux land isn’t new. Lyle Jack, the chairman of the OSPA board, says his interest goes back to 2004, when he was a member of the Oglala Lakota Tribal Council. A Chicago-based renewable-energy firm came to the Tribe with a proposal for a 280-megawatt wind farm. “We didn’t know much about [wind power]. We did a little research and thought it was a good deal. We worked out a deal and took it to the Tribal Council, and they approved it.  We were going to lease the land, put no money down and just collect lease and royalties. Which was standard back then.” 

It wasn’t that simple. “As with any Tribal agreement, you have to go to the BIA for approval. So we sent it on to the BIA. And at that time, it was so new, that no one knew what the fair market value of wind energy was. And [the BIA] had to determine what was fair payments to the Tribe, because of their trust responsibility to the Tribe. So they sat on it for about a year and a half.”

The potential partner couldn’t wait that long. “You know, time is money,” Jack says. “They said, ‘We’re sorry, but we have to move on.'”

Lyle Jack, the chairman of the OSPA board (OSPA)

The obvious failure of the process made Lyle Jack want to try it again — the right way. “I stayed with it, because it intrigued me,” Jack says. “I thought, here’s a resource where we don’t have to drill, we don’t have to dig for it or tear our land up, we don’t have to pollute the air. And it’s very abundant here on the reservation.”

***

The next breakthrough came in the form of a phone call from Chase Iron Eyes, an attorney and activist from Standing Rock. Jack recalls Iron Eyes’ radically sensible idea. “Lyle, I’m sitting here with a bunch of Tribes, and all these Tribes are interested in doing wind energy,” Iron Eyes said. “They’ve all tried to do projects on their own, but they were all failures. We’d like to get together and just share ideas. We’re all running into the same problems, so let’s see what we can do to help each other.”

It wasn’t long before Jack found himself in a meeting at Eagle Butte, the Cheyenne River Sioux headquarters, that was also attended by representatives from several other Sioux Tribes. Those gathered described their Tribes’ frustrations at trying to bring wind power to their lands. This was, in a way, the beginning of the Oceti Sakowin Power Authority, though those in attendance didn’t know it. 

When it came time for Jack to tell of the Oglalas’ misfire, his story was hopeful. “I told them, ‘Maybe the BIA sitting on our deal, and practically killing it, was a blessing for us. Because it allowed us to research it and learn more. And what we determined was we want to develop our own project, but we also want to wholly control it, not just sit back and collect royalties. I think that’s the path [Oglala is] going to take.'”

***

The Oceti Sakowin Power Project (as it was then called) held its first official meeting in 2011. The organization began the process of sending out RFPs, and talking with developers and investors. The initial results were familiar and frustrating — big power companies were interested in reaping wind power from Tribal lands, but only if they could own the operation. 

A fateful conversation with a developer along the way taught Jack another lesson, perhaps the most valuable one: Investors aren’t interested in small projects. “They don’t want to do just 100 or 200 megawatts,” the developer said. “They want something big. You do 500 to 1,000 megawatts, then you’ll get attention. Then you’ll get the big boys’ interest.”

A call from Bob Gough of the Intertribal Council on Utility Policy brought up a tantalizing, big-thinking possibility: A meeting with President Bill Clinton to present the Oceti Sakowin Power Project’s (OSPP) plan to the Clinton Global Initiative (CGI).

So it came to pass: In the closing session of the 2013 CGI America Conference in Chicago, President Clinton welcomed six Sioux Tribal presidents to the stage to announce the CGI’s commitment to OSPP. They were joined by representatives from the Bush Foundation, Rockefeller Philanthropy Advisers, and the Northwest Area Foundation, all of which would become key sponsors for OSPP.

“That was basically our coming-out party,” Jack says.

***

With a structure in place and financial backers on board, there was just one thing left: An actual partner experienced in building large-scale renewable energy projects. OSPA put out a request for information (RFI), hoping to attract a qualified partner. “We got a lot of response back, the bigger corporations,” says Jack. “They told us they would have to own the project. There’s too much money involved; once they’ve poured in these hundreds of millions of dollars, they were not going to feel comfortable with the Tribes handling all that.” Jack says that OSPA had found a firm based in Montreal that offered an acceptable deal. But as OSPA was preparing to close a deal with the Canadian firm, the Clinton Global Initiative again came through for the Sioux.

“This is where my hat really goes off to President Clinton,” Jack says. “Clinton’s representatives got ahold of us and said ‘We have a firm that is very interested in working with you. They like what you guys are doing and we think they would agree to your terms.’ And that’s how we met Apex.” Apex is Apex Clean Energy, a Charlottesville, Virginia-based company that provides a full slate of services — from development to financing — to bring projects like OSPA’s to life. “We told them what we wanted,” says Jack, “and they had no problem with the Tribe owning the majority of it.” OSPA looked at the two proposals — one from the Canadian firm, and one from Apex that promised OSPA a 51 percent majority — and decided Apex was the better fit.

The company that OSPA formed with Apex in 2017 is called 7G Renewable Energy, a name that embraces a fundamental Native idea about stewardship of the planet. Putting together all the pieces, OSPA aims to use one sacred gift, the wind, to mitigate the abuse of Mother Earth, all in the name of preserving the planet for the next seven generations.

***

Apex Clean Energy team n CRST site visit with Ryman LeBeau (Cheyenne River Tribal Council Rep. and OSPA Board Director)[/caption]

Jack sees OSPA as a template for other projects in Indian Country. He often returns to the idea of “going big” — of coming up with a project that is of a scale that will impress and entice large investors. But going big, in this case and perhaps others, can require some maneuvering. 

“It’s very rare that our Tribes come together, especially amongst the Sioux Nation,” he observes. “We all share the same cultural beliefs, we speak the same language, we’re pretty much interrelated. But it’s very hard to bring us together because each Tribe is allowed to pursue what they want. One Tribe can’t tell another Tribe what to do.” But for the sake of going big, Jack and the other OSPA board members were able to — had to — bring the Tribes together.

“Some of our Tribes don’t have the resources to do that, to go big,” Jack observes. “Some of us do, and some of us don’t. So what we do is, we come together and we share our resources, and share the governance, and share the power of them.”

***

Apex Clean Energy team n CRST site visit with Ryman LeBeau (Cheyenne River Tribal Council Rep. and OSPA Board Director)

The six Tribes of the OSPA (Cheyenne River Sioux, Flandreau Santee Sioux, Oglala Lakota, Rosebud Sioux, Standing Rock Sioux, and Yankton Sioux) have agreed upon a system that empowers members with equality but rewards production. On the board, each tribe has one vote — the Oglala, with an enrollment of over 35,000, have the same voting influence as the 726-member Flandreau Santee. The board’s resolutions are decided by simple majority. There’s one more layer to the OSPA: A six-member board of elders who sit in on meetings and provide guidance as regards the culture and values of the Sioux people. It’s a parallel structure; just as the board members are empowered to speak for the Tribes and Tribal councils, these elder-representatives are empowered to speak for the elders on their respective reservations. 

While the board is supremely democratic, each Tribe’s operation is self-contained and capitalist. Tribes are encouraged to produce as much power as they can, and are entitled to the revenue it earns.

The first two Tribes set to build their facilities — and reap the benefits — are the Oglala and Cheyenne River, who aim to produce a combined 570 megawatts of power out of the gate: 450 of it at the Ta’teh Topah (“Four Winds”) wind farm on Cheyenne River, and the remaining 120 megawatts at the Pass Creek facility on the Oglalas’ home of Pine Ridge. Construction on these projects should wrap up by late 2020 or early 2021. 

Jack says there’s a simple reason that these two will go first: transmission lines. “You have to go where the transmission lines are,” Jack explains. “At this stage, we don’t have the financial resources to go out and build our own transmission lines. Cheyenne River are located near the Oahe Dam, so there’s transmission running in and out of there because it’s a hydro dam.” 

OSPA found that a transmission line that was close to Pine Ridge and Rosebud was running 120 megawatts under capacity, so those two tribes planned to build wind farms that would each produce 60 megawatts. But slowdowns in Rosebud’s administrative process put them behind Pine Ridge’s schedule. “As I said, time is money,” Jack notes. OSPA decided to shelve the Rosebud facility, and build a wind farm on Pine Ridge that would produce all 120 megawatts. The decision was made together, based on what was best for the Power Authority. “Even the Rosebud board member agreed,” says Jack, clearly pleased at the cooperation.

Rosebud and the other three reservations will benefit from Ta’teh Topah and Pass Creek. Jack explains that the Power Authority gets a “substantial” development fee. The board decided together that the development fee collected will be applied to the next project — in this case, wind power facilities on the other reservations. “When we do that,” Jack says, “we reduce the need for outside investors. And we’re able to control a larger share of future projects, because we’re going to be putting more skin in the game. We’re non-profit, so what we make off [our wind farms], we have to put that back in. And what we make off of Rosebud, we’ll put that into, say, Yankton.”

***

As for the power itself, some of it is destined for local use, to lower utility bills on the rez, and some will be sold to utilities. Beyond that, Jack and others see a unique opportunity to sell power to tech giants — for instance, in Silicon Valley. These operations use a lot of electricity, and tend to be forward-thinking and conservation-minded. They might even pay a little more for power they know is clean. “And for them, to buy power from a business that’s majority Native American-owned, that’s good for their public relations,” Jack adds. With a relationship established, tech companies might even look to set up an office or facility in a place like Pine Ridge, with its abundant power and affordable workforce.

***

The wind has always been a sacred resource for the Native people of the Plains. And in recent years, it has emerged as a key solution to an energy crisis that is no mere matter of dollars and cents, or geopolitical conflict. Natives have for so long seen their lands bespoiled by reckless pursuit of energy: The toxic leftovers from uranium mining; polluted air and wasted water caused by fracking; oil-drenched fields resulting from pipeline spills. All over the world, these and other abuses have contaminated regions of Mother Earth for this generation and those to follow. 

But perhaps the OSPA signals a turning of the tide — a way to power our lives with a gift given freely from the Creator, rather than one wrested away with much collateral damage.

“We hope to share this with the rest of the country,” Jack says, “and say ‘Look, the Tribes are doing their part. They’re actually trying to reduce that carbon footprint. They’re actually practicing what they preach.’ And hopefully when we share that with other government entities in the United States, they’ll want to do the same.”

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