Hydro Licensing Reform: A Comprehensive Look at the Proposals

Hydro Review

March 2003

By Michael A. Swiger and Megan M. Grant

The Federal Energy Regulatory Commission has begun a stakeholder-wide effort to reform the hydropower licensing process, incorporating proposals from government and industry groups, regulatory agencies, non-governmental organizations, and the public. This article outlines the various proposals FERC is considering, and offers insight about when action might be taken.

On September 18, 2002, the Federal Energy Regulatory Commission (FERC or commission) published a "Notice Requesting Comments and Establishing Public Forums and Procedures and Schedule,” setting in motion the long-awaited process of reforming FERC’s hydroelectric licensing procedures. Licensees and stakeholders facing relicensing are looking to the proposed reforms with the hope and expectation that the process will become more streamlined and efficient.      

Many projects could benefit from such changes. For example, from 2003 through 2009, approximately 126 FERClicensed hydropower projects will require new licenses (relicenses). Another estimated 55 project licenses will expire between 2010 and 2015. Under the current relicensing procedures, it takes an average of 8.5 years from the filing of the notice of intent to apply for a new license until the new license is issued.

In addition to providing interested entities an opportunity to present their ideas about reform, FERC asked for comments on two specific proposals. The first proposal was developed by the Interagency Hydropower Committee (IHC), consisting of staff from FERC and the U.S. departments of Agriculture, Commerce, and Interior. The second proposal was developed by the National Review Group (NRG), a coalition of industry and non-governmental organizations.

FERC conducted workshops and stakeholder forums on the September 18 notice throughout the fall of 2002, and accepted initial public comments until December 2002. According to the notice, FERC may issue a “Notice of Proposed Rulemaking” on the issue in late February 2003 for additional public comment. If the schedule is maintained, it is possible that a final rule could be published as early as the fall of 2003, and take effect early in 2004.  

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