H.R. 9806: Fair Licensing for Operations of Water Structures Act

This bill would change how certain hydropower-related projects are handled under the Federal Power Act, and it would create a faster licensing path for small hydrokinetic energy projects.

Changes for hydropower maintenance and project modifications

For existing hydropower projects, the bill would limit when the Federal Energy Regulatory Commission (FERC) must approve changes. In general, FERC would still have to approve substantial alterations or additions to a project’s works or operations. But it would not need to approve smaller changes, as defined by future FERC regulations, or temporary changes caused by things outside the licensee’s control, such as extreme weather, natural disasters, equipment failures, or other unforeseen events.

The bill would also say FERC does not need to approve routine maintenance, repairs, or replacement work that is needed to keep project facilities in working order.

At the same time, the bill preserves FERC’s authority to:

• require notice from licensees where allowed under current law;
• enforce dam safety and license requirements;
• hold informal safety consultations before work begins; and
• require changes in advance when needed to protect dam safety and related structures.

New FERC rulemaking on what counts as a major change

Within 90 days after enactment, FERC would have to propose a rule explaining how to distinguish between:

• a substantial alteration or addition;
• a nonsubstantial alteration or addition; and
• routine maintenance, repair, or replacement.

After public comment, FERC would then have 180 more days to issue a final rule with standards and a formal process for deciding which project changes require FERC approval.

Micro hydrokinetic energy projects

The bill would create a special licensing process for “micro hydrokinetic energy projects,” which are projects of 5 megawatts or less that generate electricity from moving water such as waves, tides, currents, rivers, lakes, streams, or man-made channels. These projects would not include projects that dam or impound water to make electricity.

For these projects, FERC could issue licenses lasting between 10 and 20 years.

Faster licensing timeline

The bill would set a quicker approval process for these small hydrokinetic projects:

• The applicant would start by filing a notice of intent.
• In some cases, the notice would have to be filed at least 2 years before an existing license expires.
• The full application would generally have to be filed within 1 year after the notice of intent.
• FERC would have to take final action on the application within 1 year after the application is filed.
• FERC and other relevant federal agencies would be expected to create a joint schedule so reviews and permits are completed on time, as long as that schedule still fits within the 1-year deadline for final FERC action.

Environmental review and regulations

Within 180 days, FERC would have to write regulations to carry out the new micro hydrokinetic licensing process. Those regulations would need to speed up deployment while still ensuring safe operation and compliance with federal and state laws.

The regulations would also need to use one or more categorical exclusions under the National Environmental Policy Act for low-disturbance activities, including exceptions for extraordinary circumstances where the exclusion would not apply.

Report to Congress

FERC would have to report to Congress on the environmental, economic, reliability, and affordability effects of licensed micro hydrokinetic projects. That report would be due either 5 years after enactment or after the first 50 such projects have been operating for at least one year, whichever comes first.

Relevant Companies

None found