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Hydro Relicensing Redux: Will Dams Be Saved?

Fortnightly Magazine - April 1 2000

I can. We haven't taken any players right away. We simply said here are a few reasonable rules that you must play by."

The Operator's View: Time, Costs Spin Out of Control

David Moller manages Pacific Gas & Electric's relicensing effort throughout the country. As the company's director of projects and relicensing-trade and collaborative, he is managing 11 hydro projects in various stages of relicensing.

Moller explains the pros and cons of the three different relicensing procedures offered by the FERC.

Three-Phase Approach. "The traditional approach, sometimes called the three-phase approach, involves first determining what the issues are, and then the second phase is the licensee performing studies to evaluate the project impact," he says.

The second phase ends when the licensee files the license application. Typically, the FERC will then prepare an environmental analysis. The license application has to be filed no less than two years before the license expiration when using this approach, explains Moller.

The benefits of this three-phase approach are that it applies structure and a discipline to the relicensing process.

"In relicensing there can be competition for the license. Anybody can file an application for the license, not just the licensee. The timeframe for a competitor to file its license application is the same time requirement for the licensee," Moller explains.

"[Furthermore], it allows the existing licensee the ability to not reveal a whole lot of information about their relicensing plan until the application has been filed," he says.

As for the cons of the traditional approach, Moller says, "There is no requirement for collaboration and little requirement to take any input from anybody else." That can lead to adversarial relationships when parties that would have liked to be involved are left out of the process.

"If it is a highly adversarial situation and there are different views and the parties are unlikely to agree, it does provide a method to still file for a new license," he says.

But adversarial relationships developed early on can intensify in the settlement process under the traditional approach, and may extend the process, he explains.

Collaborative Approach. Under an alternative license process established in 1997, the primary environmental analysis is performed before the license application is filed.

Says Moller, "The environmental analysis is filed with the license application. It turns out it is not the final environmental analysis but a preliminary one. FERC still does its own environmental analysis, but it relies heavily on the one that was performed."

This alternative approach, often called the collaborative process, allows the hydro operator to collaborate with environmentalists, interested parties, and resource agencies years before submitting the application to FERC.

Hydro Relicensing: The Division of Power

Hydroelectric projects due for relicensing today are subject to the provisions of the following regulations - and the many government agencies they empower.

  • Section 4(e) of the Federal Power Act authorizes land-administering agencies, typically the Department of Agriculture and the Department of the Interior, to impose mandatory conditions on projects located on federal reservations they supervise.
  • Section 18 of the Federal Power Act authorizes the Department of