Obama Taking Ecosystem Approach for our Oceans

MARK CLAYTON, The Christian Science Monitor, September 17, 2009

With demands on US ocean resources control growing quickly, the Obama administration today outlined a new comprehensive ocean management plan to guide federal agencies in restoring and protecting a badly stressed US coastal and ocean environment.

Today’s policy shift proposed by the president’s Interagency Ocean Policy Task Force holds enormous potential for sweeping changes in how the nation’s oceans are managed, including energy development, experts say.

At its core, the plan would set up a new National Ocean Council to guide a holistic “ecosystem-based” approach intended to elevate and unify what has long been a piecemeal approach by US agencies toward ocean policy and development — from oil and gas exploration to fisheries management to ship transportation to recreation.

The proposal would include “a more balanced, productive, and sustainable approach to using managing and conserving ocean resources,” Nancy Sutley, chairman of the president’s Council on Environmental Quality told reporters in a teleconference unveiling the plan. It would also set up “a comprehensive national approach to uphold our stewardship responsibilities and ensure accountability for our actions.”

Dr. Sutley, who also chaired the interagency task force, appeared alongside representatives from the Department of Interior, the Coast Guard, the Department of Transportation, and the National Oceanic and Atmospheric Administration. But the proposal would apply to 24 agencies.

“This will be the first time we have ever had this kind of action for healthy oceans from any president in US history,” Sarah Chasis, director of the ocean initiative at Natural Resources Defense Council wrote in her blog. She called it the “most progressive, comprehensive national action for our oceans that we have ever seen.”

The changes could affect new offshore wind energy proposals as well as oil and natural gas exploration. “We haven’t fully looked at all aspects of the report,” says Laurie Jodziewicz, manager of siting policy for the American Wind Energy Association. “The one concern we have is we don’t want to stop the momentum of offshore wind projects we’re already seeing. So while we’re certainly not opposed to marine spatial planning, we would like to see projects already in the pipeline move ahead and start getting some offshore projects going in the US.”

One senior official of the American Petroleum Institute said he had not yet seen the proposal and could not comment on it.

The new push comes at a time when major decisions will be needed about whether and how to explore or develop oil and gas in now-thawing areas of the Arctic Ocean near Alaska. Policy changes could also affect deep-water regions in the Gulf of Mexico as well as the siting of wave power and renewable offshore wind turbines off the East Coast.

At the same time, desalination plants, offshore aquaculture, and liquefied natural gas (LNG) terminals are clamoring for space along coastal areas where existing requirements by commercial shipping and commercial fishing are already in place.

All of that – set against a backdrop of existing and continuing damage to fisheries, coral, coastal wetlands, beaches, and deteriorating water quality – has America’s oceans “in crisis,” in the words of a landmark Pew Oceans Commission report issued in 2003. More than 20,000 acres of wetlands and other sensitive habitat disappear annually, while nutrient runoff creates “dead zones” and harmful algal blooms. Some 30% of US fish populations are overfished or fished unsustainably, the report found.

Among the Interagency Ocean Policy Task Force’s national objectives were:

1. Ecosystem-based management as a foundational principle for comprehensive management of the ocean, coasts, and Great Lakes.
2. Coastal and marine spatial planning to resolve emerging conflicts to ensure that shipping lanes and wind, wave, and oil and gas energy development do not harm fisheries and water quality.
3. Improved coordination of policy development among federal state, tribal, local, and regional managers of ocean, coasts, and the Great Lakes.
4. Focus on resiliency and adaptation to climate change and ocean acidification.
5. Pay special attention to policies needed to deal with changing arctic conditions.

Experts said that the new, unified policy was timely, after decades of hit-or-miss development policies.

“We have been managing bits and pieces of the ocean for a long time, but while some good has been done on pollution and resource management, it hasn’t been sufficient.” says Andrew Rosenberg, professor of natural resources at the University of New Hampshire and an adviser to the president’s ocean task force.”This policy shift comes at a critical time for our oceans for so many reasons.”

The new proposal won’t be finalized until next year, after a 30-day comment period that begins now. Still, environmentalists were quick to hail the plan as a critical and timely step to begin healing disintegrating environmental conditions in US coastal waters and in the US exclusive economic zone that extends 200 miles beyond its territorial waters.

In June, President Obama set up the commission to develop: “a national policy that ensures the protection, maintenance, and restoration of the health of ocean, coastal, and Great Lakes ecosystems and resources, enhances the sustainability of ocean and coastal economies.”

It must also, he wrote, “preserve our maritime heritage, provides for adaptive management to enhance our understanding of and capacity to respond to climate change, and is coordinated with our national security and foreign policy interests.”

“It’s the first time the federal government has put out a decent paper that proposes what a national policy and attitude toward our oceans should be,” says Christopher Mann, senior officer Pew Environment Group, the environmental arm of the Pew Charitable Trust.

In one of the more telling passages buried down in its interim report, the task force called for decisions guided by “best available science” as well as a “precautionary approach” that reflects the Rio Declaration of 1992, which states: “where there are threats of serious or irreversible damage, lack of full scientific certainty shall not be used as a reason for postponing cost-effective measures to prevent environment degradation.”

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Salazar’s View on US Offshore Wind Energy Potential

Excerpts from Environmental Leader, April 10, 2009

US Department of the Interior Secretary Ken Salazar told participants at a summit meeting “that U.S. offshore areas hold enormous potential for wind energy development in all coastal metropolitan centers, and the wind potential off the coasts of the lower 48 states could exceed electricity demand in the U.S.

The National Renewable Energy Lab (NREL) has identified more than 1,000 gigawatts (GW) of wind potential off the Atlantic coast, and more than 900 GW of wind potential off the Pacific Coast. There are more than 2,000 MW of offshore wind projects proposed in the United States, according to the Department of Interior.

The total wind potential for the Atlantic region is 1024 gigawatts (GW), and 1 GW of wind power will supply between 225,000 to 300,000 average U.S. homes with power annually, according to U.S. Geological Survey-Minerals Management Service Report.

New Jersey is tripling the amount of wind power it plans to use by 2020 to 3,000 megawatts, or 13% of New Jersey’s total energy, according to AP. In Atlantic City alone, the local utilities authority has a wind farm consisting of five windmills that generate 7.5 megawatts, enough energy to power approximately 2,500 homes, according to the article.

The biggest potential wind power is located out in deep waters (see chart above) — 770.9 GW in the Atlantic, 891.4 GW in the Pacific and 67 GW in the Gulf, according to NREL. The laboratory assumes that about 40% of wind potential, or 185 GW, could be developed, to power about 53.3 million average U.S. homes.

But some believe Salazar’s estimates are too optimistic.

Mark Rodgers, a spokesman for Cape Wind, pushing to build a wind farm off Cape Cod, Mass., told the Associated Press that it would take hundreds of thousands of windmills with the average wind turbine generating between 2 to 5 megawatts per unit.

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The Way to a New Energy Future

Ken Salazar, U.S. Secretary of the Interior, July 26, 2009

Just north of the Colorado-New Mexico border, in the sunny expanses of my native San Luis Valley, America’s clean energy future is taking root.

Under President Obama’s leadership, four tracts of land in southern Colorado and two dozen tracts across six Western states may soon be supplying American homes with clean, renewable electricity from the first large-scale solar power projects on our nation’s public lands.

The 24 Solar Energy Study Areas that Interior is evaluating for environmentally appropriate solar energy development could generate nearly 100,000 megawatts of solar electricity, enough to power more than 29 million American homes.

The West’s vast solar energy potential – along with wind, geothermal and other renewables – can power our economy with affordable energy, create thousands of new jobs and reduce the carbon emissions that are warming our planet.

As President Obama has said, we can remain the world’s largest importer of oil or we can become the world’s largest exporter of clean energy. The choice is clear, and the economic opportunities too great to miss. Will we rise to the challenge?

It is time that Washington step up to the plate, just as states like Colorado and local governments are already doing. Congress must pass strong and effective legislation that will steer our nation toward a clean energy economy that creates new jobs and improves our energy security.

We will not fully unleash the potential of the clean energy economy unless Congress puts an upper limit on the emissions of heat-trapping gases that are damaging our environment. Doing so will level the playing field for new technologies by allowing the market to put a price on carbon, and will trigger massive investment in renewable energy projects across the country.

We are also seeing the dangerous consequences of climate change: longer and hotter fire seasons, reduced snow packs, rising sea levels and declines of wildlife. Farmers, ranchers, municipalities and other water users in Colorado and across the West are facing the possibility of a grim future in which there is less water to go around.

But with comprehensive clean energy legislation from Congress, sound policies and wise management of our nation’s lands and oceans, we can change the equation.

That is why I am changing how the federal government does business on the 20% of the nation’s land mass and 1.75 billion acres of the Outer Continental Shelf that we oversee. We are now managing these lands not just for balanced oil, natural gas, and coal development, but also – for the first time ever – to allow environmentally responsible renewable energy projects that can help power President Obama’s vision for our clean energy future.

American business is responding to these new opportunities. Companies are investing in wind farms off the Atlantic seacoast, solar facilities in the Southwest and geothermal energy projects throughout the West. We need comprehensive legislation that will create new jobs, promote investment in a new generation of energy technology, break our dependence on foreign oil, and reduce greenhouse gas emissions.

Let us rise to the energy challenges of our time.

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OPT Leaving California for Oregon Wave Energy

Excerpts from FRANK HARTZELL’s article in the Mendocino Beacon, June 4, 2009

Ocean Power Technologies’ subsidiary California Wave Energy Partners in it’s “wave energy project proposed off Cape Mendocino has surrendered its Federal Energy Regulatory Commission (FERC) preliminary permit, making two major companies that have abandoned the area in the past two weeks.

The moves come at a time when President Obama’s energy policy has cut funding for wave energy in favor of solar and wind energy development.

The withdrawals leave GreenWave Energy Solutions LLC, with a permit off Mendocino, as the only local wave energy project.

Pacific Gas and Electric Company announced earlier this month they would not seek to develop wave energy off Fort Bragg. However, PG&E has not yet legally abandoned its FERC preliminary permit.

California Wave Energy Partners did just that on May 26, telling FERC their parent company, Ocean Power Technologies (OPT) was pulling out of California in favor of developing wave energy more seriously in Oregon.

The project was proposed near Centerville off Humboldt County, south of Eureka on the remote coast of Cape Mendocino.

“OPT subsidiaries are also developing two other projects at Coos Bay and Reedsport,” wrote Herbert Nock of OPT. “During the process of developing these projects, OPT has learned the importance of community involvement in the project definition and permitting process.

“OPT therefore feels it is in the best interests of all parties to focus its efforts (in Oregon) at this time. This will allow the time and resources necessary to responsibly develop these sites for the benefit of the coastal community and the state,” Nock wrote.

The Cape Mendocino project was to be situated in a prime wave energy spot, but with connections to the power grid still to be determined. The project was never the subject of a public meeting in Mendocino County and stayed under the radar compared to several other Humboldt County projects. PG&E still plans to develop its WaveConnect project off Eureka.

Brandi Ehlers, a PG&E spokeswoman, said PG&E plans to relinquish the preliminary permit for the Mendocino Wave Connect project soon.

She said the utility spent $75,000 on the Mendocino County portion of Wave Connect before stopping because Noyo Harbor was ill-equipped to deal with an offshore energy plant.

“PG&E is not currently pursuing applications for new FERC hydrokinetic preliminary permits, but it is important that we continue to explore other possibilities,” Ehlers said in response to a question.

Secretary of the Interior Ken Salazar has announced that his department will host 12 public workshops this month to discuss the newly-issued regulatory program for renewable energy development on the U.S. Outer Continental Shelf.

All the meetings are to be held in large cities — in Seattle June 24, Portland on June 25, and San Francisco on June 26.

Salazar restarted the process of building a framework for energy development in the ocean, which had been started in the Bush Administration but never finished.

The new program establishes a process for granting leases, easements, and rights-of-way for offshore renewable energy projects as well as methods for sharing revenues generated from OCS renewable energy projects with adjacent coastal States. The rules for alternative energy development in the oceans become effective June 29.

Most of the actual ocean energy development figures are for the Atlantic and Gulf of Mexico. The Pacific Ocean’s near-shore slopes are too steep and too deep for current wind energy technology. Wave and tidal energy are still in their infancy, not seen as able to help with President Obama’s energy plan.

The Obama administration has proposed a 25% cut in the research and development budget for wave and tidal power, according to an in-depth report in the Tacoma, Wash., News Tribune.

At the same time the White House sought an 82% increase in solar power research funding, a 36% increase in wind power funding and a 14% increase in geothermal funding. But it looked to cut wave and tidal research funding from $40 million to $30 million, the News Tribune reported.

Interior’s Minerals Management Service, the agency charged with regulating renewable energy development on the Outer Continental Shelf [and specifically wind energy projects], is organizing and conducting the workshops, which will begin with a detailed presentation and then open the floor to a question and answer session. All workshops are open to the public and anyone interested in offshore renewable energy production is encouraged to participate.”

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Obama Moves to Cut Wave Energy Funding

LES BLUMENTHAL, The Bellingham Herald, May 30, 2009

The Obama administration has proposed a 25% cut in the research and development budget for one of the most promising renewable energy sources in the Northwest – wave and tidal energy. At the same time the White House sought an 82% increase in solar power research funding, a 36% increase in wind power funding and a 14% increase in geothermal funding. But it looked to cut wave and tidal research funding from $40 million to $30 million.

The decision to cut funding came only weeks after the Interior Department suggested that wave power could emerge as the leading offshore energy source in the Northwest and at a time when efforts to develop tidal power in Puget Sound are attracting national and international attention. By some estimates, wave and tidal power could eventually meet 10% of the nation’s electricity demand, about the same as hydropower currently delivers.

Some experts have estimated that if only 0.2% of energy in ocean waves could be harnessed, the power produced would be enough to supply the entire world. In addition to Puget Sound and the Northwest coast, tidal and wave generators have been installed, planned or talked about in New York’s East River, in Maine, Alaska, off Atlantic City, N.J., and Hawaii. However, they’d generate only small amounts of power.

The Europeans are leaders when it comes to tidal and wave energy, with projects considered, planned or installed in Spain, Portugal, Scotland, Ireland and Norway. There have also been discussions about projects in South Korea, the Philippines, India and Canada’s Maritime provinces.

The proposed cut, part of the president’s budget submitted to Congress, has disappointed Sen. Patty Murray, D-Wash. “Wave and tidal power holds great promise in helping to meet America’s long-term energy needs,” Murray said, adding that Washington state is a leader in its development. “It’s time for the Department of Energy to focus on this potential. But playing budget games won’t get the work done.” Murray’s staff said that while $16.8 billion in the recently passed stimulus bill is reserved for renewable energy and energy efficiency, none of it is earmarked for wave and tidal power.

Energy Department spokesman Tom Welch, however, said the Obama administration is asking for 10 times more for tidal and wave power than the Bush administration did. “The trend line is up,” Welch said. “The department is collaborating with industry, regulators and other stakeholders to develop water resources, including conventional hydro.”

Murray sees it differently. Congress appropriated $40 million for the current year, so the Obama administration proposal actually would cut funding by a fourth. Utility officials involved in developing tidal energy sources said the administration’s approach was shortsighted. “We need all the tools in the tool belt,” said Steve Klein, general manager of the Snohomish County Public Utility District. “It’s dangerous to anoint certain sources and ignore others.”

The Snohomish PUD could have a pilot plant using three tidal generators installed on a seabed in Puget Sound in 2011. The tidal generators, built by an Irish company, are 50 feet tall and can spin either way depending on the direction of the tides. The units will be submerged, with 80 feet of clearance from their tops to the water’s surface. They’ll be placed outside of shipping channels and ferry routes. The pilot plant is expected to produce one megawatt of electricity, or enough to power about 700 homes. If the pilot plant proves successful, the utility would consider installing a project that powered 10,000 homes.

“A lot of people are watching us,” Klein said. The Navy, under pressure from Congress to generate 25% of its power from renewable sources by 2025, will install a pilot tidal generating project in Puget Sound near Port Townsend next year.

In Washington state, law requires that the larger utilities obtain 15% of their electricity from renewable sources by 2020. The law sets up interim targets of 3% by 2012 and 9% by 2016. Most of the attention so far has focused on developing large wind farms east of the Cascade Mountains. Because wind blows intermittently, however, the region also needs a more reliable source of alternative energy.

Tidal and wave fit that need. Also, at least with tidal, the generators would be closer to population centers than the wind turbines in eastern Washington. “The potential is significant and (tidal and wave) could accomplish a large fraction of the renewable energy portfolio for the state,” said Charles Brandt, director of the Pacific Northwest National Laboratory’s marine sciences lab in Sequim.

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Ocean Energy Surges Forward

MARK CLAYTON, The Christian Science Monitor, April 24, 2009

Three miles off the craggy, wave-crashing coastline near Humboldt Bay, California, deep ocean swells roll through a swath of ocean that is soon to be the site of the nation’s first major wave energy project.

Like other renewable energy technology, ocean energy generated by waves, tidal currents or steady offshore winds has been considered full of promise yet perennially years from reaching full-blown commercial development.

That’s still true – commercial-scale deployment is at least five years away. Yet there are fresh signs that ocean power is surging. And if all goes well, WaveConnect, the wave energy pilot project at Humboldt that’s being developed by Pacific Gas and Electric Co. (PG&E), could by next year deploy five commercial-scale wave systems, each putting 1 megawatt of ocean-generated power onto the electric grid.

At less than 1% of the capacity of a big coal-fired power plant, that might seem a pittance. Yet studies show that wave energy could one day produce enough power to supply 17% of California’s electric needs – and make a sizable dent in the state’s greenhouse gas emissions.

Nationwide, ocean power’s potential is far larger. Waves alone could produce 10,000 megawatts of power, about 6.5% of US electricity demand – or as much as produced by conventional hydropower dam generators, estimated the Electric Power Research Institute (EPRI), the research arm of the public utility industry based in Palo Alto, California, in 2007. All together, offshore wind, tidal power, and waves could meet 10% of US electricity needs.

That potential hasn’t gone unnoticed by the Obama administration. After years of jurisdictional bickering, the Federal Energy Regulatory Commission (FERC) and the Department of Interior — MMS last month moved to clarify permitting requirements that have long slowed ocean energy development.

While the Bush administration requested zero for its Department of Energy ocean power R&D budget a few years ago, the agency has reversed course and now plans to quadruple funding to $40 million in the next fiscal year.

If the WaveConnect pilot project succeeds, experts say that the Humboldt site, along with another off Mendocino County to the south, could expand to 80 megawatts. Success there could fling open the door to commercial-scale projects not only along California’s surf-pounding coast but prompt a bicoastal US wave power development surge.

“Even without much support, ocean power has proliferated in the last two to three years, with many more companies trying new and different technology,” says George Hagerman, an ocean energy researcher at the Virginia Tech Advanced Research Institute in Arlington, Va.

Wave and tidal current energy are today at about the same stage as land-based wind power was in the early 1980s, he says, but with “a lot more development just waiting to see that first commercial success.”

More than 50 companies worldwide and 17 US-based companies are now developing ocean power prototypes, an EPRI survey shows. As of last fall, FERC tallied 34 tidal power and nine wave power permits with another 20 tidal current, four wave energy, and three ocean current applications pending.

Some of those permits are held by Christopher Sauer’s company, Ocean Renewable Power of Portland, Maine, which expects to deploy an underwater tidal current generator in a channel near Eastport, Maine, later this year.

After testing a prototype since December 2007, Mr. Sauer is now ready to deploy a far more powerful series of turbines using “foils” – not unlike an airplane propeller – to efficiently convert water current that’s around six knots into as much as 100,000 watts of power. To do that requires a series of “stacked” turbines totaling 52 feet wide by 14 feet high.

“This is definitely not a tinkertoy,” Sauer says.

Tidal energy, as demonstrated by Verdant Power’s efforts in New York City’s East River, could one day provide the US with 3,000 megawatts of power, EPRI says. Yet a limited number of appropriate sites with fast current means that wave and offshore wind energy have the largest potential.

“Wave energy technology is still very much in emerging pre-commercial stage,” says Roger Bedard, ocean technology leader for EPRI. “But what we’re seeing with the PG&E WaveConnect is an important project that could have a significant impact.”

Funding is a problem. As with most renewable power, financing for ocean power has been becalmed by the nation’s financial crisis. Some 17 Wall Street finance companies that had funded renewables, including ocean power, are now down to about seven, says John Miller, director of the Marine Renewable Energy Center at the University of Massachusetts at Dartmouth.

Even so, entrepreneurs like Sauer aren’t close to giving up – and even believe that the funding tide may have turned. Private equity and the state of Maine provided funding at a critical time, he says.

“It’s really been a struggle, particularly since mid-September when Bear Sterns went down,” Sauers says. “We worked without pay for a while, but we made it through.”

Venture capitalists are not involved in ocean energy right now, he admits. Yet he does get his phone calls returned. “They’re not writing checks yet, but they’re talking more,” he says.

When they do start writing checks, it may be to propel devices such as the Pelamis and the PowerBuoy. Makers of those devices, and more than a dozen wave energy companies worldwide, will soon vie to be among five businesses selected to send their machines to the ocean off Humboldt.

One of the major challenges they will face is “survivability” in the face of towering winter waves. By that measure, one of the more successful generators – success defined by time at sea without breaking or sinking – is the Pelamis, a series of red metal cylinders connected by hinges and hydraulic pistons.

Looking a bit like a red bullet train, several of the units were until recently floating on the undulating sea surface off the coast of Portugal. The Pelamis coverts waves to electric power as hydraulic cylinders connecting its floating cylinders expand and contract thereby squeezing fluid through a power unit that extracts energy.

An evaluation of a Pelamis unit installed off the coast of Massachusetts a few years ago found that for $273 million, a wave farm with 206 of the devices could produce energy at a cost of about 13.4 cents a kilowatt hours. Such costs would drop sharply and be competitive with onshore wind energy if the industry settled on a technology and mass-produced it.

“Even with worst-case assumptions, the economics of wave energy compares favorably to wind energy,” the 2004 study conducted for EPRI found.

One US-based contestant for a WaveConnect slot is likely to be the PowerBuoy, a 135-five-foot-long steel cylinder made by Ocean Power Technology (OPT) of Pennington, N.J. Inside the cylinder that is suspended by a float, a pistonlike structure moves up and down with the bobbing of the waves. That drives a generator, sending up to 150 kilowatts of power to a cable on the ocean bottom. A dozen or more buoys tethered to the ocean floor make a power plant.

“Survivability” is a critical concern for all ocean power systems. Constant battering by waves has sunk more than one wave generator. But one of PowerBuoy’s main claims is that its 56-foot-long prototype unit operated continuously for two years before being pulled for inspection.

“The ability to ride out passing huge waves is a very important part of our system,” says Charles Dunleavy, OPT’s chief financial officer. “Right now, the industry is basically just trying to assimilate and deal with many different technologies as well as the cost of putting structures out there in the ocean.”

Beside survivability and economics, though, the critical question of impact on the environment remains.

“We think they’re benign,” EPRI’s Mr. Bedard says. “But we’ve never put large arrays of energy devices in the ocean before. If you make these things big enough, they would have a negative impact.”

Mr. Dunleavy is optimistic that OPT’s technology is “not efficient enough to rob coastlines and their ecosystems of needed waves. A formal evaluation found the company’s PowerBuoy installed near a Navy base in Hawaii as having “no significant impact,” he says.

Gauging the environmental impacts of various systems will be studied closely in the WaveConnect program, along with observations gathered from fishermen, surfers, and coastal-impact groups, says David Eisenhauer, a PG&E spokesman, says.

“There’s definitely good potential for this project,” says Mr. Eisenhauer. “It’s our responsibility to explore any renewable energy we can bring to our customers – but only if it can be done in an economically and environmentally feasible way.”

Offshore wind is getting a boost, too. On April 22, the Obama administration laid out new rules on offshore leases, royalty payments, and easement that are designed to pave the way for investors.

Offshore wind energy is a commercially ready technology, with 10,000 megawatts of wind energy already deployed off European shores. Studies have shown that the US has about 500,000 megawatts of potential offshore energy. Across 10 to 11 East Coast states, offshore wind could supply as much as 20% of the states’ electricity demand without the need for long transmission lines, Hagerman notes.

But development has lagged, thanks to political opposition and regulatory hurdles. So the US remains about five years behind Europe on wave and tidal and farther than that on offshore wind, Bedard says. “They have 10,000 megawatts of offshore wind and we have zero.”

While more costly than land-based wind power, new offshore wind projects have been shown in some studies to have a lower cost of energy than coal projects of the same size and closer to the cost of energy of a new natural-gas fired power plant, Hagerman says.

Offshore wind is the only ocean energy technology ready to be deployed in gigawatt quantities in the next decade, Bedard says. Beyond that, wave and tidal will play important roles.

For offshore wind developers, that means federal efforts to clarify the rules on developing ocean wind energy can’t come soon enough. Burt Hamner plans a hybrid approach to ocean energy – using platforms that produce 10% wave energy and 90% wind energy.

But Mr. Hamner’s dual-power system has run into a bureaucratic tangle – with the Minerals Management Service and FERC both wanting his company to meet widely divergent permit requirements, he says.

“What the public has to understand is that we are faced with a flat-out energy crisis,” Hamner says. “We have to change the regulatory system to develop a structure that’s realistic for what we’re doing.”

To be feasible, costs for offshore wind systems must come down. But even so, a big offshore wind farm with hundreds of turbines might cost $4 billion – while a larger coal-fired power plant is just as much and a nuclear power even more, he contends.

“There is no cheap solution,” Hamner says. “But if we’re successful, the prize could be a big one.”

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FERC Dismisses All Grays Harbor Permit Apps

MendoCoastCurrent, April 23, 2009

In Octoberr 2008 Grays Harbor Ocean Energy applied for seven Federal Energy Regulatory Commission (FERC) preliminary permits for projects located in the Atlantic Ocean about 12 to 25 miles offshore off the coasts of New York, Massachusetts, and Rhode Island, and in the Pacific Ocean about 5 to 30 miles off the coasts of California and Hawaii.

On April 9, 2009 FERC and MMS signed a Memorandum of Understanding (MOU) clarifying jurisdictional responsibilities for renewable energy projects in offshore waters on the Outer Continental Shelf (OCS).  The stated goals of this MOU are to establish a cohesive, streamlined process, encouraging development of wind, solar, and ocean or wave energy projects.

In this MOU, FERC agrees to not issue preliminary permits for ocean or wave projects that are located on the Outer Continental Shelf. 

And as a result, on April 17, 2009 FERC dismissed all seven Grays Harbor’s pending preliminary permit applications for its proposed wave projects as each and every project is located on the OCS.

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Wave Energy Not Yet Ready for Prime Time

COLIN SULLIVAN, The New York Times, April 14, 2009

Palo Alto — Technology for tapping ocean waves, tides and rivers for electricity is far from commercial viability and lagging well behind wind, solar and other fledgling power sectors, a panel of experts said last week during a forum here on climate change and marine ecosystems.

While the potential for marine energy is great, ocean wave and tidal energy projects are still winding their way through an early research and development phase, these experts said.

“It’s basically not commercially financeable yet,” said Edwin Feo, a partner at Milbank, Tweed, Hadley & McCloy, during a conference at Stanford University. “They are still a long ways from getting access to the capital and being deployed, because they are simply immature technologies.”

Ocean and tidal energy are renewable sources that can be used to meet California’s renewable portfolio standard of 10 percent of electricity by 2010. But the industry has been hampered by uncertainty about environmental effects, poor economics, jurisdictional tieups and scattered progress for a handful of entrepreneurs.

Finavera Renewables, based in British Columbia, recently canceled all of its wave projects, bringing to a close what was the first permit for wave power from the Federal Energy Regulatory Commission. And last fall, the California Public Utilities Commission (CPUC) denied Pacific Gas & Electric Co.’s application for a power purchase agreement with Finavera Renewables, citing the technology’s immaturity.

Roger Bedard, head of the Electric Power Research Institute’s wave power research unit, said the United States is at least five and maybe 10 years away from the first commercial project in marine waters. A buoy at a Marine Corps base in Hawaii is the only wave-powered device that has been connected to the power grid so far in the United States. The first pilot tidal project, in New York’s East River, took five years to get a permit from FERC.

Feo, who handles renewable energy project financing at his law firm, says more than 80 ocean, tidal and river technologies are being tested by start-ups that do not have much access to capital or guarantee of long-term access to their resource. That has translated into little interest from the investment community.

“Most of these companies are start-ups,” Feo said. “From a project perspective, that doesn’t work. People who put money into projects expect long-term returns.”

William Douros of the National Oceanic and Atmospheric Administration (NOAA) expressed similar concerns and said agency officials have been trying to sort through early jurisdictional disputes and the development of some technologies that would “take up a lot of space on the sea floor.”

“You would think offshore wave energy projects are a given,” Douros said. “And yet, from our perspective, from within our agency, there are still a lot of questions.”

‘Really exciting times’

But the belief in marine energy is there in some quarters, prompting the Interior Department to clear up jurisdictional disputes with FERC for projects outside 3 miles from state waters. Under an agreement announced last week, Interior will issue leases for offshore wave and current energy development, while FREC will license the projects.

The agreement gives Interior’s Minerals Management Service exclusive jurisdiction over the production, transportation or transmission of energy from offshore wind and solar projects. MMS and FERC will share responsibilities for hydrokinetic projects, such as wave, tidal and ocean current.

Maurice Hill, who works on the leasing program at MMS, said the agency is developing “a comprehensive approach” to offshore energy development. Interior Secretary Ken Salazar himself has been holding regional meetings and will visit San Francisco this week to talk shop as part of that process.

Hill said MMS and the U.S. Geological Survey will issue a report within 45 days on potential development and then go public with its leasing program.

“These next couple of months are really exciting times, especially on the OCS,” he said.

Still, Hill acknowledged that the industry is in an early stage and said federal officials are approaching environmental effects especially with caution.

“We don’t know how they’ll work,” he said. “We’re testing at this stage.”

‘Highly energetic’ West Coast waves

But if projects do lurch forward, the Electric Power Research Institute’s Bedard said, the resource potential is off the charts. He believes it is possible to have 10 gigawatts of ocean wave energy online by 2025, and 3 gigawatts of river and ocean energy up in the same time frame.

The potential is greatest on the West Coast, Bedard said, where “highly energetic” waves pound the long coastline over thousands of miles. Alaska and California have the most to gain, he said, with Oregon, Washington and Hawaii not far behind.

To Feo, a key concern is the length of time MMS chooses to issue leases to developers. He said the typical MMS conditional lease time of two, three or five years won’t work for ocean wave technology because entrepreneurs need longer-term commitments to build projects and show investors the industry is here to say.

“It just won’t work” at two, three or five years, Feo said. “Sooner or later, you have to get beyond pilot projects.”

Hill refused to answer questions about the length of the leases being considered by MMS.

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MMS and FERC Rivalry Stalls Wind Energy

H. JOSEF HEBERT, The Associated Press, March 16, 2009

While the Obama administration has touted offshore renewable energy development, a turf fight between two federal agencies has stymied the government’s ability to issue rules needed to approve wind energy projects off America’s coasts.

Interior Secretary Ken Salazar said Monday the infighting has got to stop.

“It will be resolved,” Salazar said in response to questions about the dispute. “We will not let any of the jurisdictional turf battles of the past get in the way of our moving forward with the renewable energy agenda.”

The dispute, which dates to late 2007, pits the Interior Department against the Federal Energy Regulatory Commission over which entity should approve projects that use coastal waves and currents to produce power.

Offshore wind development has been entangled in the dispute because Interior’s Mineral Management Service does not want to separate wind projects from the tidal wave, or hydrokinetic power, programs – which FERC in turn has refused to surrender, according to several officials who have followed the dispute.

Interior and FERC are said to be close to agreement on a “memorandum of understanding” that would delineate each organization’s involvement in the offshore renewable energy approval process.

Salazar has been vocal in his call for more aggressive development of renewable energy projects off the country’s coasts, especially off the northern and central Atlantic. He said the governors of New Jersey and Delaware have asked what is holding up the regulations and said projects off their coasts are ready to go.

Jon Wellinghoff, acting chairman of FERC, played down the interagency dispute and – like Salazar – said he was confident the problem will soon be worked out.

“It’s less of a dispute than people say it is,” insisted Wellinghoff in a brief interview, adding that he doubted it has stopped any wind projects.

“It has nothing to do with wind. It only has to do with our jurisdiction over hydrokinetic systems, whether they are on the Outer Continental Shelf or not,” said Wellinghoff. He said he saw no reason why the Mineral Management Service would insist on viewing the tidal wave and wind issues together.

Salazar over the past week met with Wellinghoff to try to work out a memorandum of understanding that could be issued as early as this week. Both men are expected to be asked about the disagreement at a Senate Energy and Natural Resources Committee hearing Tuesday.

“If we don’t resolve the jurisdictional issues between FERC and the Department of Interior, we are not going to be able to move forward in the development of our offshore renewable energy resources,” said Salazar.

Mike Olsen, an attorney who represents Deep Water Wind, a company that wants to build a 96-turbine wind farm off the New Jersey coast, calls the dispute a classic government turf battle.

“It’s two agencies both feeling each has specific authority and jurisdiction. Neither one wants to yield its authority or jurisdiction to the other,” said Olsen, who as a deputy assistant Interior secretary in the Bush administration observed the dispute first hand.

Interior waged “a full court press” to get the rules on offshore renewable energy development finalize last year, Olsen said, but the effort was thwarted by the lack of an agreement with FERC.

“From our perspective the rule was ready to go in November,” said Olsen. But despite involvement of the Bush White House, no memorandum of understanding on the jurisdiction issue could be hammered out between Interior and FERC.

With a new administration on the horizon “the battle was put on hold,” he said.

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Plan, Baby, Plan

Washington Post Editorial, February 12, 2009

Interior Secretary Salazar Keeps his Options Open on Offshore Drilling 

Here’s the ultimate midnight regulation: On the very last day of the Bush administration, the Interior Department proposed a new five-year plan for oil and gas leasing on the outer continental shelf. All hearings and other meetings on the scope of the plan, which would have opened as much as 300 million acres of seafloor to drilling, were to be completed by March 23, 2009. On Tuesday, Ken Salazar, President Obama’s interior secretary, pushed back the clock 180 days, imposing order on a messy process.

Mr. Bush’s midnight maneuver would have auctioned oil and gas leases without regard to how they fit into a larger strategy for energy independence. More can be done on the shelf than punching for pools of oil to satisfy the inane “drill, baby, drill” mantra that masqueraded as Republican energy policy last summer.

Mr. Salazar’s 180-day extension of the comment period is the first of four actions that he says will give him “sound information” on which to base a new offshore plan for the five years starting in 2012. He has directed the Minerals Management Service and the U.S. Geological Survey to round up all the information they have about offshore resources within 45 days. This will help the department determine where seismic tests should be conducted. Some of the data on the Atlantic are more than 30 years old.

The secretary will then conduct four regional meetings within 30 days of receiving that report to hear testimony on how best to proceed. Mr. Salazar has committed to issuing a final rule on offshore renewable energy resources “in the next few months.” Developing plans to harness wind, wave and tidal energy offshore would make for a more balanced approach to energy independence. It would also have the advantage of complying with the law. Mr. Salazar helped to write a 2005 statute mandating that Interior issue regulations within nine months to guide the development of those offshore renewable energy sources [the Energy Policy Act of 2005], a requirement that the Bush administration ignored.

Mr. Salazar’s announcement was also notable for what it didn’t do. Much to the chagrin of some environmental advocates, it didn’t take offshore drilling off the table. Nor did it cut oil and gas interests out of the discussion.

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Surprising Oregon Wave Energy FERC Permit Issued

SUSAN CHAMBERS, The World, February 3, 2009

Coos Bay — The announcement came as a surprise to everyone.

The Federal Energy Regulatory Commission’s Thursday order issuing a preliminary permit for a 200- to 400-buoy wave energy project off of Newport shocked Ocean Power Technologies leaders as well as the public.

“It’s a project, a site that is not on our priority list right now,” OPT spokesman Len Bergstein said. “It was a little bit of a surprise to us in terms of timing.”

What’s different about this project is that FERC’s approval stirs up a hornet’s nest at the time OPT is trying to work with residents on the South Coast for community approval of two sites: a 10-buoy project off of Gardiner and a 200-buoy project off of the North Spit.

It also calls into question FERC’s intentions of adhering to a memorandum of understanding previously negotiated with Oregon to give the state greater siting power over wave energy projects in the territorial sea.

The approval also seems to be designed for FERC to flex authority over territory traditionally overseen by the U.S. Department of Interior’s Minerals Management Service. Both agencies have claimed the area outside of Oregon’s territorial sea, beyond three nautical miles.

Mixed Messages

As the FERC notice of approval hit residents’ e-mail inboxes late Thursday, outrage began to build.

“My concern is this sends the wrong message,” said Lincoln County District Attorney Rob Bovett. “This is high-value crab grounds, about as valuable as you get.”

OPT applied for the permit in November 2006, but let the application slide. The jurisdictional battle meant the application was going nowhere fast. OPT decided to concentrate its work on the Gardiner and Coos Bay sites, both of which are inside the territorial sea.

Bergstein said as soon as he found out about the approval, he immediately called Lincoln County Commissioner Terry Thompson and other Lincoln County folks, particularly those involved with the Fishermen Involved in Natural Energy group.

“Clearly, we have not been prompting FERC,” Bergstein said.

Bovett, who was involved in the commenting on the original OPT application, said Fishermen Involved has been working with wave energy companies to determine the best sites for development that would have the least impact on the fishing industry and local communities. This, though, was different.

“FINE wasn’t involved in the selection of this box,” Bovett said.

State vs. FERC?

Bovett’s first question was: Does the memorandum of understanding not mean anything?

In March 2008, FERC and Oregon signed a memorandum designed to “coordinate the procedures and schedules for review of wave energy projects.”

Bovett just chuckled.  According to the deal, he said, FERC wasn’t going to issue permits willy nilly. 

Some of the discrepancy over the decision to issue a preliminary permit — which allows OPT to only study the area for feasibility — may be because Oregon hasn’t finished updating its territorial sea plan. The Ocean Policy Advisory Council and the state have been working on it, but the marine reserves issue has dominated the council’s time over the past year.

“This will obviously get everybody’s attention,” Southern Oregon Ocean Resource Coalition Chairman Nick Furman said of FERC’s decision.

That’s putting it lightly.

Whereas the Reedsport and Coos Bay sites are considered by some to be ground zero as far as local communities negotiating with wave energy developers, the Newport site could be ground zero for state vs. federal and agency vs. agency jurisdiction and siting battles.

However, Bovett said, OPT holds the key right now.

The New Jersey-based wave energy developer should withdraw from  the site, he said. Otherwise, years of litigation seem likely — and courts ultimately would have the final say over which agency should be in charge of alternative energy.

“OPT can fix this,” Bovett said. “It’s exactly what they should do.”

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Ken Salazar, New Interior Secretary, Voices Openness to Offshore Oil Drilling

STEPHEN POWER, The Wall Street Journal, January 28, 2009
Interior Secretary Ken Salazar indicated Tuesday that the Obama Administration could be open to expanded offshore drilling and is considering doing away with a controversial program that allows oil companies to pay in kind for oil and natural gas taken from public lands.

Salazar inherited a Bush Administration plan that would open tracts off the Atlantic and Pacific coasts where drilling had previously been prohibited. Environmental groups want the Obama administration to re-impose a ban on expanded offshore drilling that President George W. Bush lifted last year.

Asked in an interview with The Wall Street Journal whether President Barack Obama might try to reinstate the ban, Salazar paused 18 seconds before saying: “I don’t know.”

“We have significant drilling already in many places of the Gulf coast. We have drilling in many places off the Alaska shorelines. There are other places that hold potential for exploration. We’ll develop our guidelines as to how we’re going to look at it. But we’re still at the beginning of an information-gathering process,” he said.

Asked about the Bush administration’s proposal to open certain areas of the Atlantic and Pacific coasts to drilling and whether he saw any opportunities for expanded development of the nation’s offshore areas, Salazar said: “When you look at the whole [outer continental shelf], it’s a huge potential. And it has to be done carefully. We don’t want to ruin the beaches of Florida and the coastlines of other places that are sensitive.”

“On the other hand, there are places where it may be appropriate for us to have reconnaissance and exploration and even development. Those are questions that we are exploring and hopefully over the months ahead we’ll have answers to these questions,” he said.

Salazar left the door open to curtailing the “royalty-in-kind” program, under which the government receives oil or natural gas instead of cash for payments of royalties from companies that lease federal property for oil and gas development, and then sells the product into the marketplace and returns the proceeds to the Treasury. “We’re going to put everything on the table — I think everything needs to be looked at,” Salazar said.

Meanwhile, Salazar said new legislation may be needed to overhaul the scandal-plagued Minerals Management Service, a bureau of Interior that manages the nation’s offshore oil and natural gas reserves.

Salazar said his top priority is to restore confidence in the agency, and in particular the MMS, which was rocked last fall by a report from the department’s inspector general that accused some MMS employees of accepting gifts from and having sex with oil and gas industry representatives whose activities they were supposed to regulate.

Although the Bush administration late last year announced disciplinary action ranging from warnings to termination of more than a half-dozen workers implicated in the report, Salazar said he is mulling “whether additional actions are required.”

Many environmental groups are looking to Salazar to reverse certain policy changes made in the final months of the Bush administration, including new regulations on commercial oil-shale development that the groups say lock in inappropriately low royalty rates for energy firms. Salazar said he and his aides intend to review “all those issues” and that “I expect that there will be changes.”

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Offshore Oil Drilling on the North Coast of California?

Let Your Voice Be Heard by March 23, 2009

by MendoCoastCurrent and pointarenabasin

Beginning January 22, 2009 and ending on March 23, 2009, a 60-day Public Comment Period opened regarding new offshore oil and gas exploration and drilling in the pristine waters off northern California.

And while this is a multi-step process and before things are cast in stone, NOW is the time to share your views.

FROM THE FEDERAL REGISTER – REQUEST FOR PUBLIC COMMENTS

DEPARTMENT OF THE INTERIOR – Minerals Management Service

Request for Comments on the Draft Proposed 5-Year Outer Continental Shelf (OCS) Oil and Gas Leasing Program for 2010-2015 and Notice of Intent To Prepare an Environmental Impact Statement (EIS) for the Proposed 5-Year Program

AGENCY: Minerals Management Service, Interior.

ACTION: Request for Comments.

SUMMARY: The Minerals Management Service (MMS) requests comments on the Draft Proposed 5-year OCS Oil and Gas Leasing Program for 2010-2015 (DPP). This draft proposal is for a new oil and gas program to succeed the current program that is currently set to expire on June 30, 2012, and forms the basis for conducting the studies and analyses the Secretary will consider in making future decisions on what areas of the OCS to include in the program.

DATES: Please submit comments and information to the MMS no later than March 23, 2009.

LINK:  Federal eRulemaking Portal: http://www.regulations.gov. Under the tab “More Search Options,” click “Advanced Docket Search,” then select “Minerals Management Service” from the agency drop-down menu, then click the submit button. In the Docket ID column, select MMS-2008-OMM-0045 to submit public comments and to view related materials available for this Notice.

Mail or hand-carry comments to the Department of the Interior; Minerals Management Service; Attention: Leasing Division (LD); 381 Elden Street, MS-4010; Herndon, Virginia 20170-4817. Please reference “2010-2015 Oil and Gas Leasing in the Outer Continental Shelf,” in your comments and include your name and return address.

Summary of the Draft Proposed Program

In developing the DPP for 2010-2015, the MMS considered oil and gas leasing in the areas of the OCS that are included in the current 5-year program for 2007-2012 and additional areas off Alaska, Pacific coast, the Gulf of Mexico, and Atlantic coast. Some of these additional areas had been subject to annual congressional moratoria prohibiting oil and gas leasing. However, the moratoria expired on September 30, 2008. The DPP includes lease sales in offshore areas that have the highest oil and gas resource values and highest industry interest.

It has been promoted that 47 comments from oil and gas companies or associations nominated specific planning areas to be included in the new 5-Year program; some nominated all planning area.  

Wave energy reporter Frank Hartzell claims that the nominations may have been fabricated, see In Last Days, Bush Inflicts North Coast Offshore Oil Plan.

Table A–Draft Proposed Program for 2010-2015–Lease Sale Schedule

———————————————————————

Sale Number Area Year

———————————————————————

236…………………… Northern California………..2014

Pacific Region

The Pacific Region consists of 4 planning areas–Washington-Oregon, Northern California, Central California, and Southern California. The DPP schedules one sale in the Northern California Planning Area and two in the Southern California Planning Area. The proposed sales are in areas of known hydrocarbon potential – the Point Arena Basin in Northern California.

Environmental Impact Statement (EIS) Preparation

Pursuant to section 102(2)(C) of NEPA, the MMS intends to prepare an EIS for the new 5-year OCS oil and gas leasing program for 2010-2015. This notice starts the formal scoping process for the EIS under 40 CFR 1501.7, and solicits information regarding issues and alternatives that should be evaluated in the EIS. The EIS will analyzethe potential impacts of the adoption of the proposed 5-year program.

The comments that MMS has received in response to the August 2008, Request for Comments, and the comments received during scoping for the 2007-2012 5-Year EIS have identified environmental issues and concerns that MMS will consider in the EIS. In summary, these include climate change as an impact factor in cumulative analyses, the effects of the OCS program on climate change, potential impacts from accidental oil spills, potential impacts to tourism and recreation activities, and ecological impacts from potential degradation of marine and coastal habitats. Additionally alternatives will be developed and analyzed during the EIS process based on scoping comments and governmental communications. Alternatives may include increasing or decreasing the number or frequency of sales, coastal buffers, limiting areas available for leasing, and excluding parts of or entire planning areas.

Scoping Meetings

Meetings will be held between now and March 23, 2009 to receive scoping comments on the EIS including –

Ft. Bragg/Ukiah, California; TBA

Next Steps in the Process

The MMS plans to issue the proposed program and draft EIS in mid-summer 2009 for a 90-day comment period and plans to issue the proposed final program and final EIS in spring 2010. The Secretary of the Interior may approve the new 5-year program 60 days later to go into effect as of July 1, 2010.

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Bush Seeks Drilling Off California Coast in Final Days

JANE KAY, San Francisco Chronicle, January 17, 2009

The U.S. Interior Department, acting in President Bush’s final days in office, proposed on Friday opening up 130 million acres off of California’s coast to drilling for oil and natural gas, including areas off Humboldt and Mendocino counties and from San Luis Obispo south to San Diego.

After a hands-off policy for a quarter-century, the administration submitted plans to sell oil and gas leases for most of the U.S. coast, from the Gulf of Maine to Chesapeake Bay and the Outer Banks of North Carolina to the Gulf of Mexico and the Pacific Coast.

New drilling also was proposed in Alaska’s Bristol Bay, one of the nation’s most plentiful sources of fish, and the Arctic Ocean.

Washington, Oregon and protected parts of Florida were excluded along with waters off San Francisco Bay that lie within national marine sanctuaries.

On Friday, the American Petroleum Institute, the U.S. Chamber of Commerce and other business groups greeted the news with praise, saying it is time for domestic energy supplies to be released from the moratorium.

But environmental groups and some Democratic leaders who oppose California drilling criticized the 11th-hour move, vowing to work with the Obama administration to promote energy independence based on clean, renewable technologies.

“President Bush’s last-ditch effort to open our coasts to new drilling is nothing more than a parting gift to his buddies in the oil and gas industry,” said Lois Capps, D-Santa Barbara, a member of the House Natural Resources Committee.

On the eve of the 40th anniversary of the platform blowout that spilled 3 million gallons of black crude oil on 35 miles of beaches around Santa Barbara, Capps said, “New offshore drilling would not lower gas prices, make us more energy independent or get our economy back on track.”

Richard Charter, a longtime environmental lobbyist who now works for the Defenders of Wildlife Action Fund, called the government’s move “an extremist act.”

“What we see today is the political equivalent of a rock star trashing the hotel room right before checkout,” he said.

The Interior Department used a lapse in the congressional moratorium in October and a cancellation of a presidential prohibition in July to set in motion the lease-sale program – which the incoming administration of President-elect Barack Obama could cancel or proceed with.

Obama has said he would consider some offshore oil drilling as part of a comprehensive energy plan. Sen. Ken Salazar, D-Colo., Obama’s pick for interior secretary, hasn’t given his views on offshore drilling in California. He said in his confirmation hearings Thursday that he will confer with the administration’s team.

Gov. Arnold Schwarzenegger, along with the governors of Oregon and Washington, opposes new offshore oil drilling despite the new revenue it would offer the cash-strapped state.

The federal government has failed to make a case for a new program because energy resources are insignificant in the Atlantic, Pacific and eastern Gulf of Mexico, already-sold leases aren’t being used, and no protections are in place to protect the environment, the governors said.

In Friday’s announcement, Interior Department officials proposed three new lease sales, one in Northern California and two in Southern California in “areas with known hydrocarbon potential.” The proposals, which were based on requests from seven oil companies that weren’t named, would include:

— As many as 44 million acres of federal waters, which start 3 miles from the shoreline, off Humboldt and Mendocino counties.

— As many as 89 million acres off of San Luis Obispo, Santa Barbara, Ventura, Los Angeles, Riverside and San Diego counties. One lease would require equipment operating at a diagonal to drill within the Santa Barbara Ecological Preserve. In Southern California, there are 79 existing leases with 43 producing and 36 undeveloped.

There will be a 60-day comment period, with hearings in Ukiah, Fort Bragg, Santa Barbara, Ventura and San Diego. Dates for the hearings have not been announced.

If sales are allowed, they could occur as soon as 2014.

About 60%  of California citizens who commented on new oil-and-gas development were opposed to new drilling, according to the Interior Department’s oil-drilling agency, the Minerals Management Service.

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Ken Salazar Pledges Reform to US Dept of the Interior

MICHAEL FALCONE, The New York Times, January 16, 2009

On January 15, 2009, Senator Ken Salazar pledged to “clean up the mess” at the Interior Department if he is confirmed as the next chief of the department, which has been plagued by ethics scandals.

Mr. Salazar, Democrat of Colorado, also said he shared President Obama’s commitment to ending the country’s dependence on foreign oil, a goal that he said could be achieved, in part, through greater use of renewable resources like solar and wind power.

But he avoided specifics when members of the Senate Committee on Energy and National Resources, who are considering his confirmation, pressed him on whether he supported an expansion of oil extraction from public lands and offshore drilling. 

On the question of whether to open more areas off the coasts to oil exploration, Mr. Salazar said there might be some areas where it would be appropriate and “other places that are off limits.”

The full Senate voted Thursday to set aside two million acres in nine states as protected wilderness. Approval is expected in the House.

Mr. Salazar, who was a farmer and rancher before he entered public life, also promised that on his watch the agency, which has jurisdiction over vast expanses of federal lands, would not be focused solely on the western half of the United States.

“I want this department to be America’s department,” he said.

Mr. Salazar also fielded questions on a variety of other topics, including the Endangered Species Act and changes at the Bureau of Indian Affairs. 

He kept his answers short, and often vague, but appeared to breeze through the hearing before a committee of his legislative colleagues.

Senator Ron Wyden,  Democrat of Oregon, said that it had turned into a “full-fledged bouquet-tossing contest.”

But Mr. Wyden warned Mr. Salazar that he had some “very heavy lifting ahead,” and sought assurances that he would review some decisions made by Bush administration officials to see if they were politically tainted.

Mr. Salazar said, “We will review what decisions have been made to see whether there is action necessary to make sure that they’re in compliance with the law and to make sure they’re in compliance with the science.”

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Oil Drilling Off California Coast Again Under Consideration

JANE KAY, The San Francisco Chronicle, December 29, 2008

The federal government is taking steps that may open California’s fabled coast to oil drilling in as few as three years, an action that could place dozens of platforms off the Sonoma, Mendocino and Humboldt coasts, and raises the specter of spills, air pollution and increased ship traffic into San Francisco Bay.

Millions of acres of oil deposits, mapped in the 1980s when then-Interior Secretary James Watt and Energy Secretary Donald Hodel pushed for California exploration, lie a few miles from the forested North Coast and near the mouth of the Russian River, as well as off Malibu, Santa Monica and La Jolla in Southern California.

“These are the targets,” said Richard Charter, a lobbyist for the Defenders of Wildlife Action Fund who worked for three decades to win congressional bans on offshore drilling. “You couldn’t design a better formula to create adverse impacts on California’s coastal-dependent economy.”

The bans that protected both of the nation’s coasts beginning in 1981, from California to the Pacific Northwest to the Atlantic Coast and the Straits of Florida, ended this year when Congress let the moratorium lapse.

President-elect Barack Obama hasn’t said whether he would overturn President Bush’s lifting last summer of the ban on drilling, as gas prices reached a historic high. Sen. Ken Salazar, D-Col., Obama’s pick as interior secretary and head of the nation’s ocean-drilling agency, hasn’t said what he would do in coastal waters.

The Interior Department has moved to open some or all federal waters, which begin 3 miles from shore and are outside state control, for exploration as early as 2010. Rigs could go up in 2012.

National marine sanctuaries off San Francisco and Monterey bays are off-limits in California. Areas open to drilling extend from Bodega Bay north to the Oregon border and from Morro Bay south to the U.S.-Mexico border.

Drilling foes say the impacts of explosive blasts from seismic air guns that map rock formations, increased vessel traffic and oil spills should be enough to persuade federal agencies to thwart petroleum exploration. California’s treasured coast, with its migrating whales, millions of seabirds, sea otters, fish and crab feeding grounds, beaches and tidal waters, are at risk, Charter and other opponents say.

According to the Interior Department, coastal areas nationwide that were affected by the drilling ban contain 18 billion barrels of oil and 76 trillion cubic feet of natural gas in what the agency called yet-to-be-discovered fields. The estimates are conservative and are based on seismic surveys in the late 1970s and early 1980s, before the moratorium went into effect.

California’s Share

The agency’s last estimate puts about 10 billion barrels in California, enough to supply the nation for 17 months. That breaks down to 2.1 billion barrels from Point Arena in Mendocino County to the Oregon border, 2.3 billion from Point Arena south to San Luis Obispo County and 5.6 billion between there and Mexico.

“If you were allowed to go out and do new exploration, those numbers could go up or down. In most cases, you would expect them to go up,” said Dave Smith, deputy communications officer of the Interior Department’s Minerals Management Service, which oversees energy development in federal waters.

In California, any exploration and drilling would be close to shore, experts say. In contrast to the Gulf of Mexico, where drilling could occur in waters 10,000 feet deep, California’s holdings lie on its narrow, shallow continental shelf, the underwater edge of land where creatures died over the millennia to produce the oil.

If the Interior Department decides to explore off California’s coast, it could probably do so, some attorneys say. If a state objects to a lease plan, the president has the final say.

Once an area has been leased, the California Coastal Commission may review an oil company’s plan to explore or extract resources to assess if it is consistent with the state’s coastal management program. Conflicts can end up in court, said Alison Dettmer, the commission’s deputy director.

Californians have generally opposed drilling since a platform blowout in 1969 splashed 3 million gallons of black, gooey crude oil on 35 miles of beaches around Santa Barbara, killing otters and seabirds. The destruction of shoreline and wildlife sparked activism and led to the creation of the Coastal Commission.

But when gas prices peaked a few months ago amid cries of “drill, baby, drill” at rallies for GOP presidential candidate John McCain and running mate Sarah Palin, 51 percent of Californians said they favored more offshore drilling, according to a survey by the Public Policy Institute of California.

In July, Interior Secretary Dirk Kempthorne jump-started the development of a new oil and natural gas leasing program and pushed up possible new coastal activity by two years.

The Interior Department is reviewing comments about which coastal areas to include in the next five-year leasing plan. Oil companies want all of the nation’s coastal areas open and say they can produce oil offshore in a way that protects the environment. Gov. Arnold Schwarzenegger, who opposes new offshore development, has offered comments, as have environmental groups.

Obama’s Energy Plans

Obama’s administration and Congress will have the final say over which regions, if any, would be put up for possible lease sales. In Congress earlier this year, Salazar, Obama’s nominee for interior secretary, supported a bipartisan bill allowing exploration and production 50 miles out from the southern Atlantic coast with state approval. The bill died.

“We’ve been encouraged that the president-elect has chosen Sen. Salazar,” said Dan Naatz, vice president for federal resources with the Independent Petroleum Association of America, a group with 5,000 members that drill 90% of the oil and natural gas wells in the United States. “He’s from the West, and he understands federal land policy, which is really key.”

During this year’s presidential campaign, Obama was bombarded by questions about high gas prices and said new domestic drilling wouldn’t do much to lower gasoline prices but could have a place in a comprehensive energy program.

After introducing his green team of environment and energy chiefs recently, Obama said the foundation of the nation’s energy independence lies in the “power of wind and solar, in new crops and new technologies, in the innovation of our scientists and entrepreneurs and the dedication and skill of our workforce.”

He spoke of moving “beyond our oil addiction,” creating “a new, hybrid economy” and investing in “renewable energy that will give life to new businesses and industries.”

Obama didn’t mention oil drilling. When a reporter asked him if he would reinstate the moratorium, he said he wasn’t happy that the moratorium was allowed to lapse in Congress without a broader thought to how the country was going to reduce dependence on fossil fuels.

He reiterated his campaign position that he was open to the idea of offshore drilling if it was part of a comprehensive package, adding that he would turn over the question to his team.

In the 1970s and 1980s, before the moratorium on offshore drilling fully took effect, the federal government produced a series of maps showing areas in California of prospective interest to the oil industry. Those maps offer clues to where oil companies would bid if they had the opportunity.

North Coast

The last proposed lease sale in 1987, thwarted by the moratorium, would have opened 6.5 million acres off the North Coast. Off Mendocino and Humboldt counties, the tracts for sale lay from 3 to 27 miles offshore, and some of the 24 planned platforms, some of them 300 feet tall and each with dozens of wells, would have been visible from land.

Tourism and commercial fisheries would have been affected, according to an environmental review then, while as many as 240 new oil tanker trips from Fort Bragg and Eureka to San Francisco Bay refineries were predicted under the full development scenario. The probability of one or more spills occurring would be 94 percent for accidents involving 1,000 barrels or more, according to documents.

Rep. Lois Capps, D-Santa Barbara, a member of the House Natural Resources Committee, recently said oil drilling will be part of a comprehensive energy policy focusing on renewable sources, but she would like to see drilling occur only on land and in the Gulf of Mexico where infrastructure is in place.

Capps well remembers the Santa Barbara spill almost 40 years ago.

“I was living in Goleta. I just had two children, and my husband was a young professor at UC Santa Barbara. It was a devastating experience,” she said. “The birds and other animals got trapped in the oil. So many people waded out in boots just inch by inch trying to rescue our wildlife. It ruined our tourism for many years.

“I think about it all the time, especially last week when we had had a spill at the same platform. It was a small spill, 1,000 gallons, but it was a wake-up call.”

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Obama’s Controversial Pick for Secretary of the Interior

JOHN M. BRODER, The New York Times, December 18, 2008

President-elect Barack Obama’s choice to lead the Interior Department, Senator Ken Salazar of Colorado, will inherit an agency demoralized by years of scandal, political interference and mismanagement.

He must deal with the sharp tension between those who seek to exploit public lands for energy, minerals and recreation and those who want to preserve the lands. He will be expected to restore scientific integrity to a department where it has repeatedly been compromised. He will be responsible for ending the department’s coziness with the industries it regulates. And he will have to work hard to overcome skepticism among many environmentalists about his views on resource and wildlife issues.

One senior Interior Department executive described the job Mr. Salazar has been chosen for as “the booby prize of the Cabinet.”

As Mr. Obama introduced Mr. Salazar and Tom Vilsack, the former Iowa governor tapped to be secretary of agriculture, at a press conference Wednesday in Chicago, he said their responsibility would be to balance the protection of farms and public lands against the need to find new sources of energy.

“It’s time for a new kind of leadership in Washington that’s committed to using our lands in a responsible way to benefit all our families,” Mr. Obama said. “That means ensuring that even as we are promoting development where it makes sense, we are also fulfilling our obligation to protect our national treasures.”

Mr. Salazar, wearing his customary ten-gallon hat and bolo tie, said that his job entails helping the nation address climate change through a “moon shot” on energy independence. But that would include not just the development of “green” energy sources like wind power, but also the continued domestic development of coal, oil and natural gas, fossil fuels that generate greenhouse gases when they are burned.

Environmental advocates offered mixed reviews of Mr. Salazar, 53, a first-term Democratic senator who served as head of Colorado’s natural resources department and as the state’s attorney general. Mr. Salazar was not the first choice of environmentalists, who openly pushed the appointment of Representative Raul Grijalva, Democrat of Arizona, who has a strong record as a conservationist.

Oil and mining interests praised Mr. Salazar’s performance as a state official and as a senator, saying that he was not doctrinaire about the use of public lands. “Nothing in his record suggests he’s an ideologue,” said Luke Popovich, spokesman for the National Mining Association. “Here’s a man who understands the issues, is open-minded and can see at least two sides of an issue.”

Mr. Popovich noted approvingly that Mr. Salazar had tried to engineer a deal in the Senate allowing mining companies and others to reclaim abandoned mines without fear of lawsuits. (The legislation is pending.) He has also supported robust research on technology to reduce carbon dioxide emissions from coal-burning power plants, something the coal industry favors.

He also backed a compromise that would let oil companies drill for natural gas in limited parts of the Roan Plateau in northwestern Colorado, a plan that most environmental advocates opposed.

Mr. Salazar is a fifth-generation Coloradan who grew up on a ranch near the New Mexico border. He has been a farmer, lawyer and small-business man as well as a public servant.

Pam Kiely, program director at Environment Colorado, said Mr. Salazar had been a champion of wilderness protection and of strong water quality laws, and had raised questions about the environmental costs of oil shale development, a subject of great controversy in the Mountain West. She said he had not spoken out forcefully against oil and gas development in millions of acres of national forests and roadless areas.

“We hope he continues to play a role in ensuring that, as we develop our mineral rights in these incredibly sensitive areas, we require industry to put in place safeguards that protect our health, environment, water and air quality,” Ms. Kiely said.

Marc Smith, executive director of the Independent Petroleum Association of Mountain States, said in a statement that Mr. Salazar understood that energy security can be achieved only by making use of all domestic energy sources, including those found on and under public lands.

“We are pleased that the president-elect has chosen someone who understands that there is a direct connection between federal lands and access to affordable, clean natural gas,” Mr. Smith said.

While industry officials praised his moderation, Mr. Salazar drew harsh criticism from some environmentalists.

“He is a right-of-center Democrat who often favors industry and big agriculture in battles over global warming, fuel efficiency and endangered species,” said Kieran Suckling, executive director of Center for Biological Diversity, which tracks endangered species and habitat issues. “He is very unlikely to bring significant change to the scandal-plagued Department of Interior. It’s a very disappointing choice for a presidency which promised visionary change.”

Daniel R. Patterson, formerly an official of the Interior Department’s Bureau of Land Management and now southwest regional director of the Public Employees for Environmental Responsibility, an advocacy group, said that Mr. Salazar has justifiably become the most controversial of Mr. Obama’s cabinet appointees.

“Salazar has a disturbingly weak conservation record, particularly on energy development, global warming, endangered wildlife and protecting scientific integrity,” said Mr. Patterson, who was elected last month to the Arizona House of Representatives from Tucson and who supports fellow Arizonan Mr. Grijalva for the Interior job. “It’s no surprise oil and gas, mining, agribusiness and other polluting industries that have dominated Interior are supporting rancher Salazar — he’s their friend.”

Even as Mr. Salazar navigates the department’s tricky political cross-currents, he must also deal with significant internal management challenges. Members of Congress and outside groups are calling for review of dozens of decisions made under the Bush administration on endangered species and oil and gas leasing. The senior management ranks of the department have been depleted by departures of demoralized career employees.

And the agency’s computer systems are badly in need of repair, after millions of dollars have been spent on systems that have not worked, according to several internal reports.

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Obama’s Team Leads in Renewable Energy

MendoCoastCurrent, November 17, 2008

Announcements and short biographies of Obama’s Team Leads that oversee renewable energy policy development and associated agencies.

Energy and Natural Resources Team Lead
David J. Hayes is a member of the Obama-Biden Transition Project’s Agency Review Working Group responsible for the energy and natural resources agencies. He is former Global Chair of the Environment, Land and Resources Department at Latham & Watkins, an international law firm. He is a Senior Fellow at the World Wildlife Fund, advising the President of WWF on climate change matters, and he is a Senior Fellow at the Progressive Policy Institute, specializing on energy matters. Mr. Hayes is the Vice-Chairman of the national conservation group, American Rivers, and he is the former Chairman of the Board of the Environmental Law Institute. Mr. Hayes was the Deputy Secretary of the Interior during the Clinton Administration. During the 2007-2008 academic year, Hayes was a Consulting Professor at Stanford University’s Woods Institute for the Environment.

Department of Energy Review Team Leads
Elgie Holstein was a Senior Energy Policy Advisor to the Obama for America Presidential Campaign. Under President Clinton, he was Assistant Secretary of Commerce for the National Oceanic and Atmospheric Administration; Associate Director for Natural Resources, Energy and Science at the Office of Management & Budget; Chief of Staff at the Department of Energy; and Special Assistant to the President for Economic Policy at the National Economic Council. He was also Director of State-Federal Relations for energy and environmental programs for the National Conference of State Legislatures, and worked as a congressional aide.

Elizabeth Montoya is currently a Consultant with Sealaska Corporation in Juneau Alaska where she is an expert in human resource management and strategic planning and advises the CEO and COO. Previously, she was Associate Director of Presidential Personnel in the White House, Deputy Chief of Staff at the Department of Energy, and Associate Director of Management and Administration at the Small Business Administration.

Sue Tierney is a Managing Principal and expert on economics, regulation and policy in the electric and gas industries at Analysis Group. She previously served as Assistant Secretary for Policy at the Department of Energy, under President Clinton; Secretary of Environmental Affairs in Massachusetts under Governor Weld; and Commissioner at the Massachusetts Department of Public Utilities under Governor Dukakis.

EPA Review Team Leads
Cecilia V. Estolano is the Chief Executive Officer of the Community Redevelopment Agency of Los Angeles. Prior to joining CRA/LA, Estolano practiced land use and environmental law at Gibson, Dunn & Crutcher. She has served as a Special Assistant to the City Attorney in the Los Angeles City Attorney’s Office, a Senior Policy Advisor to the Assistant Administrator for Air and Radiation at the U.S. Environmental Protection Agency and a member of the California Coastal Commission.

Lisa Jackson was appointed in 2006 by Governor Jon Corzine to lead New Jersey’s Department of Environmental Protection (DEP). Her past experience includes management responsibilities at the Environmental Protection Agency.

Robert Sussman is a Senior Fellow at the Center for American Progress (CAP). During the Clinton Administration, Sussman served as Deputy Administrator of the Environmental Protection Agency, where he played a leading role on Superfund, global warming, science policy and the North American Free Trade Agreement.

FERC Review Team Lead
Rose McKinney-James is the Managing Principal of Energy Works Consulting. Previously she served as the President and CEO of the Corporation for Solar Technology and Renewable Resources (CSTRR) and Chair of the Nevada Renewable Energy Task Force. Past positions also include Commissioner with the Nevada Public Service Commission, Director of the Nevada Department of Business and Industry, Chief of Staff for the City of Las Vegas and Project Manager for the Nevada Economic Development Corporation. McKinney-James serves on the Board of Directors of MGM-Mirage, Employers Insurance Group, Toyota Financial Savings Bank, the Energy Foundation, the American Council for an Energy Efficient Economy (ACEEE), and the Nature Conservancy. She is the Board Chair for Nevada Partners.

Department of the Interior Review Team Leads
John Leshy is a professor of law at the University of California, Hastings College of the Law in San Francisco. Previously he was Solicitor (General Counsel) of the U.S. Department of the Interior; Special Counsel to Chairman George Miller of the Resources Committee, U.S. House of Representatives; professor of law at Arizona State University in Tempe, Arizona; Associate Solicitor of Interior for Energy & Resources; and with the Natural Resources Defense Council (NRDC) in California and the Civil Rights Division of the U.S. Department of Justice in Washington.

Robert Anderson is a professor at the University of Washington School of Law and is the Director of the School’s Native American Law Center. After working for 12 years for the Native American Rights Fund, he was the associate solicitor for Indian affairs and Counselor to Interior Secretary Bruce Babbitt. He is a member of the Bois Forte Band of the Minnesota Chippewa Tribe.

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Mendocino County Granted FERC Role as FERC Asserts Position in Mendocino Wave Energy

MendoCoastCurrent, October 16, 2008

The Federal Energy Regulatory Commission (FERC) claimed that it has jurisdiction over hydroelectric projects located on the Outer Continental Shelf (OCS), pointing to laws that define its role.

FERC addressed the jurisdictional question, raised by the U.S. Department of the Interior, Mineral Management Service (MMS), in the context of a rehearing order on two preliminary permits issued to PG&E to study the feasibility of developing wave energy projects in the OCS off the California coast. The projects are the Humboldt Project off the coast of the Samoa Peninsula in Humboldt County near Eureka, and the Mendocino Project off the coast of Fort Bragg in Mendocino County.

Commissioner Philip Moeller said the development of viable hydrokinetic resources needs a streamlined process like FERC’s. “It is indisputable that renewable energy is a valuable resource and hydrokinetic projects could harness a vast resource of new hydropower,” he said. “Instead of legal battles, my preference, and this Commission’s, has been to reach out to federal agencies and states to work in a cooperative manner to the same goal: timely development of a new renewable power resource in a responsible manner after input from all affected stakeholders.”

MMS has asserted that FERC only has jurisdiction to issue licenses and preliminary permits for projects within state waters, which for most states is defined as extending three miles offshore. Projects beyond state waters are considered to be located in the OCS.

But FERC says the Federal Power Act (FPA) gives it two bases of authority to issue preliminary permits and licensees for hydroelectric projects located on the OCS. First, the law expressly grants FERC jurisdiction to license in “navigable waters” without limitation as well as in “streams or other bodies of water over which Congress has jurisdiction.” 

The second authority is for those projects located on “reservations” of the United States. FERC concludes that the OCS is land owned by the United States, qualifying it to be a “reservation” under the FPA. “The Supreme Court of the United States has consistently held that the United States owns the submerged lands off its shores, beginning from the low-water mark,” FERC said.

Finally, FERC addressed comments by MMS about the meaning of the Federal Energy Policy Act of 2005 (EPAct 2005) as it relates to the jurisdiction question for hydroelectric projects located on the OCS. MMS asserted that EPAct 2005 intended for MMS to be the lead federal regulatory authority over wave and ocean current energy projects in the OCS.

In this order, FERC notes that EPAct 2005 does not limit the scope of its authority over hydroelectric power or withdraw FERC jurisdiction over projects in the OCS. “To the contrary, Congress expressly preserved the Commission’s comprehensive hydroelectric licensing authority under the FPA by including two saving clauses….,” FERC said.

FERC Chairman Kelliher stressed today that FERC recognizes the role of Interior, which through the Minerals Management Service (MMS) manages lands on the OCS. There is no conflict with FERC’s role as the licensing agency, he said.

“We have proposed a Memorandum of Understanding (MOU) with MMS that carefully delineates the roles of the two agencies in a manner that respects both our licensing, and Interior’s resource, roles,” Kelliher said. “We stand ready to enter into the MOU to clarify those roles.”

A preliminary permit gives the holder of a permit priority over the site for three years while the holder studies the feasibility of developing the site. It does not authorize construction of any kind. A license authorizes construction and operation of a hydroelectric facility.

FERC’s order also finds that although two local governments, the City of Fort Bragg and Mendocino County, asserted that they did not receive personal notification from FERC of the filing of the preliminary permit applications, only Mendocino County acted in a timely manner once it received actual notice of the application in order to preserve its right to intervene. As a result, Mendocino County’s request for late intervention is granted. However, the order finds that Mendocino has not provided grounds for the Commission to revoke the Mendocino Project permit or to reopen that proceeding. The order also denies motions for late intervention in both proceedings by FISH Committee.

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PG&E Dumps MMS Wave Energy Involvement & Mendocino County Sues FERC

Excerpts from FRANK HARTZELL’s article at the Mendocino Beacon, September 4, 2008

PG&E decided last week not to be the national test case for the Minerals Management Service’s wave energy program.

Just two weeks earlier, the utility officially filed paperwork to pursue those same far offshore wave energy leases. None of the filings have yet been provided to this newspaper by PG&E, or presented to the public locally.

Why such a quick change of mind?

“In early August we said yes to enter into negotiations for the (MMS) Mendocino project,” said PG&E spokeswoman Jana Morris. “Within the following three weeks we hoped there would be change to the economic and commercial terms of the interim lease, which did not occur.

“At that point we made the decision to stop negotiations until the final rules are made available,” said Morris.

Minerals Management Service officials did not respond to questions about what they will do next, now that their test case is gone.

The Minerals Management Service (MMS) believes it must charge private companies and promote competition for leases of public resources — which the competing Federal Energy Regulatory Commission gives to the first company in line at no direct cost.

After no competing firms emerged by the May 19 deadline, the MMS abandoned the idea of competitive bidding and proposed charging $3 per acre annually to lease the areas.

“PG&E has concluded that the project costs, including the significant rental fees, of going forward under an interim lease are unacceptably high, particularly in light of the absence of any competitive advantage at the commercial leasing stage,” said Morris.

AND

Recent Offshore Development Timeline

• April — MMS releases its interim alternative energy application process. The MMS picks one site for each kind of energy proposed to be generated on the Outer Continental Shelf, wave, current, tide and wind. PG&E’s twin projects in Fort Bragg and Eureka are the wave energy choice.
• May — When no other developer applies for the 200 square miles of ocean that PG&E has claimed off Eureka and Fort Bragg, the MMS proposes a $3 per acre annual fee.
• August 1 — MMS announces a new initiative to open more areas to offshore oil drilling. Email and regular mail public comments are being taken through Sept. 5 on what areas should be opened.
• August 6 — PG&E officially applies for the new MMS leases at $3 per acre.
• August 15 — MMS holds a seminar in San Francisco to explain the new alternative energy process. PG&E attends.
• August 26 — Mendocino County moves ahead with suing the Federal Energy Regulatory Commission, or FERC, over its wave energy process.
• August 26 — PG&E reverses its position of August 6 and announces it won’t pursue the interim leases, instead waiting until MMS finishes its rulemaking process later in 2008 or early 2009.
• August 29 — PG&E files a six-month progress report with FERC. The company claims a large amount of local outreach in the report, naming numerous public meetings it has held. The company has revealed little or no new information at any of those meetings. The status report also mentions the company collaborated with two universities in June on filing a request with the U.S. Department of Energy.
• August 31 — California State Senate passes a joint resolution asking Congress to renew the federal waters Outer Continental Shelf offshore drilling moratorium. This resolution, AJR 51, authored by Assemblyman Pedro Nava, had been passed by the California State Assembly earlier this summer.
• September and October — Congress must pass new annual moratorium for protections off the Mendocino Coast and much of the East and West Coasts to continue. Republicans nationally make creating new drilling wherever possible a key campaign issue. A rival GOP plan would open up only certain Eastern states and new areas in the Gulf of Mexico to drilling.

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Pacific Coast Governors Embark on Ocean Action Plan

Environmental News Service, July 29, 2008

The governors of California, Oregon and Washington Tuesday announced the details of their plan to address ocean and coastal management issues such as polluted runoff, oil spills and marine garbage along the West Coast.

The West Coast Governors’ Ocean Action Plan is the result of a 2006 agreement signed by the three governors that established a long-term partnership to tackle obstacles facing the Pacific Ocean and its coastal communities.

The three states will work together on 26 actions. They promised to advocate for stricter ocean going vessel emission standards, prevent the introduction of invasive species, explore the feasibility of offshore alternative ocean energy development, improve ocean research, increase ocean education and prevent and respond to offshore oil spills, among other efforts.

Each action within the plan contains benchmarks and a timeframe for action. The governors have formally committed to report on the status of actions at the end of two years.

“This agreement is another key step in our aggressive efforts to maintain clean water and beaches along our coast,” said Governor Arnold Schwarzenegger of California, speaking with his fellow governors via satellite.

“I believe our commitment to working together and putting this plan into action will help effectively tackle critical issues up and down the West Coast,” he said, “ensuring a healthy ocean environment for current and future generations.”

Governor Ted Kulongoski of Oregon views the effort as another successful regional compact. “Just as we’ve seen with the Western Regional Climate Action Initiative, collaboration on complex natural resource issues leads to improved management, inspires innovation and ensures a healthier environment. Together, we can sustain our marine resources and the communities that depend upon them.”

“While Washington is making significant strides with state initiatives such as the Puget Sound Partnership, the crisis facing salmon this year is an example of why we must address these issues together as a region,” said Governor Christine Gregoire of Washington. “Our waters know no boundaries.”

“This plan commits us to combining our resources and ideas, and prioritizes restoring and maintaining the health of our marine and coastal waters to ensure a sustainable future,” she said.

California, Oregon and Washington have worked closely with key federal agencies as well as ocean users, academic institutions, the public, tribes, and other state and regional entities to develop the plan and will continue to collaborate with these groups to accomplish the tasks identified in the plan.

The three governors sent a joint letter to Congress asking for $5 million in federal support for implementation of the action plan. Congress has provided funding and support for similar regional ocean initiatives, such as the Gulf of Mexico Alliance.

To support the states’ agreement, a Federal Working Group, co-led by the U.S. Department of Interior, U.S. Environmental Protection Agency and the National Oceanic and Atmospheric Administration, has been established and will work with the states in implementing the actions.

The action plan commits the three states to collaborate with each other and federal partners on seven priority areas related to ocean protection:

• Ensuring clean coastal waters and beaches;
• Protecting and restoring healthy ocean and coastal habitats;
• Promoting the effective implementation of ecosystem-based management of our ocean and coastal resources;
• Reducing adverse impacts of offshore development;
• Increasing ocean awareness and literacy among our citizens;
• Expanding ocean and coastal scientific information, research and monitoring; and
• Fostering sustainable economic development throughout our diverse coastal communities.

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MMS Begins Possible New OCS Leasing Program

EnergyCurrent.com, July 30, 2008

U.S. Secretary of the Interior Dick Kempthorne has started the development of a new oil and natural gas leasing program for the U.S. Outer Continental Shelf. The action could give the next administration a head start in expanding energy production from federal offshore jurisdictions, including some areas where a congressional moratorium has restricted oil and gas development.

Reacting to current energy prices and president George W. Bush’s lifting of the presidential ban on offshore drilling, Secretary Kempthorne has directed the U.S. Minerals Management Service (MMS) to begin the initial steps for developing a new five year program. The multi-year process starts with a call for information from all parties on what a new five year program should consider.

MMS is also requesting comment to ensure that all interests and concerns are considered regarding oil and gas leasing and exploration and development resulting from a new five year program. The governors of all 50 states will be specifically asked for their comments, particularly on issues unique to each state.

The current program runs from 2007-2012 and includes 21 lease sales in eight of the 26 Outer Continental Shelf planning areas in the Gulf of Mexico, Alaska and the Atlantic. It does not include areas under a congressional ban, with the exception of Virginia. The new program, depending on public comment, can consider any area although any leasing in a banned area would need congressional action. If approved the new program would begin in 2010 and end in 2015.

Kempthorne said, “Today a barrel of oil costs more than $120, almost double the price a year ago. Clearly, today’s escalating energy prices and the widening gap between U.S. energy consumption and supply have changed the fundamental assumptions on which many of our decisions were based.”

“The American people and the President want action and this initiative can accelerate an offshore exploration and development program that can increase production from additional domestic energy resources.”

“This initiative could provide a significant advantage for the incoming administration, offering options it would not otherwise have had until at least 2010,” Kempthorne added.

“Today’s action would provide a two year head start for the next administration on developing a new five-year program.”

The Outer Continental Shelf currently provides 27% of U.S. domestic oil production and 15% of domestic natural gas production, the majority of this from the Gulf of Mexico. MMS believes that the areas under a congressional ban contain an additional 18 billion barrels of oil and 76 Tcf of natural gas in yet-to-be-discovered fields.

MMS considers the numbers conservative estimates because little exploration has been conducted in most of those areas during the past 25 years because of the congressional ban. The estimates could increase with new technology and exploration techniques.

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Feds Press Congress to Lift Oil Drilling Ban

DAVID R. BAKER, The San Francisco Chronicle, July 31, 2008

The U.S. Interior Department ratcheted up the pressure on Congress Wednesday to open more of the country’s coastline to offshore oil drilling, a move petroleum companies have sought for decades.

Interior Secretary Dirk Kempthorne said his department will lay the groundwork for selling undersea oil-drilling leases on the outer continental shelf, including areas now protected by a congressional ban. Republicans are pushing hard to end the moratorium, which was imposed in 1982 and covers most of the East and West coasts.

The Interior Department has no authority to lift the ban. But if Congress votes to open the coasts to drilling, the department could hit the ground running, selling leases as early as 2011. Exploratory drilling would probably begin a few years after that.

“Americans continue to struggle with high gas prices, and it’s important that we do more to develop domestic sources of energy,” Kempthorne said.

As a first step, the Interior Department will solicit comments from oil companies, state governors, environmental groups and others as to which specific stretches of seafloor should be leased for drilling. The department will consider areas that are already open – such as the Gulf of Mexico – as well as those that aren’t.

The move pleased oil industry groups as well as politicians who want more offshore oil production.

“We’ve got to get off foreign oil. We’ve got to use our own domestic production,” said Rep. Ken Calvert, R-Corona (Riverside County), who introduced legislation this month to lift the moratorium. He said royalties from oil pumped off the California coast could be a boon to state government.

“I think it’s a better solution than raising taxes,” Calvert said. “Why don’t we take advantage of the resources we know we have and help address the structural deficit problem in California?”

But leading congressional Democrats remain adamantly opposed to lifting the ban. They note that most of the estimated oil reserves on the outer continental shelf – about 79% – lie in areas that are already open to drilling.

“This is nothing more than a political stunt to divert attention from the high gas prices that have resulted from having two oil men in the White House,” California Sen. Barbara Boxer said Wednesday.

Environmental groups also panned the Interior Department plan. Like the congressional Democrats, they want the nation to invest more heavily in alternative energy sources and start weaning itself off oil.

“There’s simply no way, with 2% of the world’s oil reserves, that you can solve our problems by drilling” on the outer continental shelf, said Jim Presswood, an energy issues advocate for the Natural Resources Defense Council.

Interior Department officials said Wednesday that they also want to increase the development of alternative energy sources offshore. For two years, the department has studied leasing portions of the outer continental shelf to companies that want to build offshore windmills or install buoys that generate electricity as they bob up and down on the waves.

PG&E has proposed two such wave energy projects off the coasts of Humboldt and Mendocino counties.

The Interior Department’s alternative energy effort will dovetail with the new push on offshore oil drilling, Kempthorne said.

“Alternative energy development and traditional energy development are not mutually exclusive,” he said.

Although the department will ask for comments from governors, that doesn’t mean the governors would be able to veto offshore drilling in federal waters near their states. States control the waters within 3 miles of shore, but can’t directly control development farther out.

Kempthorne and other Interior Department officials emphasized on Wednesday their desire to work with the governors. But they said Congress would have to determine how much authority to give the states should legislators lift the drilling moratorium.

California Gov. Arnold Schwarzenegger opposes offshore drilling. This week, the Republican governor touted an agreement with his counterparts in Oregon and Washington to work together to protect the coastal environment, an agreement that includes rejecting offshore oil drilling.

“The governor understands that people are frustrated with the soaring price of gas, but in California, we know offshore drilling is not the answer,” said Schwarzenegger spokeswoman Lisa Page.

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MMS Proposing Rules for OCS Wind & Wave

MendoCoastCurrent, July 9, 2008

ACT NOW! – ‘MMS Rulemaking’ Public Review & Comments Accepted Thru September 8, 2008

The U.S. Department of the Interior’s Minerals Management Service (MMS) has published a proposed rule in the Federal Register that will regulate alternative energy production activities and alternate uses of existing facilities on the Outer Continental Shelf (OCS). The proposed rule is accompanied by a draft environmental assessment analyzing the potential environmental effects of the rulemaking in accordance with the National Environmental Policy Act.

MMS conducting ‘rulemaking’ to establish a program to grant leases, easements, and rights-of-way (ROW) for orderly, safe, and environmentally responsible alternative energy project activities and alternate uses of existing facilities on the OCS. The rule will also establish methods for sharing revenues generated by this program with nearby coastal States.

“This proposed rule would establish formally the framework for developing wind, wave, ocean current, solar and other renewable energy sources on America’s Outer Continental Shelf,” Assistant Secretary Stephen C. Allred said. “With this important step we can add to our ability to reduce our reliance on foreign energy by making the best use of our own domestic resources in a safe and environmentally sensitive way.”

The Energy Policy Act of 2005 authorized MMS to establish the OCS Alternative Energy and Alternate Use (AEAU) Program. Alternative energy includes, but is not limited to wind, wave, solar, ocean current and generation of hydrogen. Alternate uses of existing facilities may include aquaculture, research, education, recreation or support for offshore operations and facilities.

The process for completing the rulemaking began after the enactment of the Energy Policy Act of 2005. The Advanced Notice of Proposed Rulemaking was issued in December of 2005. The Final Programmatic Environmental Impact Statement (PEIS) was issued in November of 2007. This was followed by the release of the Record of Decision for the Final PEIS in January of 2008. The next step in the process, after the 60-day comment period on today’s proposed rule ends, will be the release of the Final Rule and final environmental assessment. The Final Rule is expected to be complete by December 2008.

Publisher’s Note: The MMS is seeking your comments on rulemaking for alternative energy projects…here’s their description: “The MMS is proposing regulations that would establish a program to authorize and manage alternative energy project activities on the OCS, as well as certain previously unauthorized activities that involve the alternate use of existing facilities located on the OCS; and would establish the methods for sharing revenues generated by this program with nearby coastal states”

Wish to Comment?

The proposed rule and draft environmental assessment invite public comments from interested parties by one of two methods:

1. Federal eRulemaking Portal. Under the tab “More Search Options,” click Advanced Docket Search, then select “Minerals Management Service” from the agency drop-down menu, then click “submit.” In the Docket ID column, select MMS-2008-OEMM-0012 (you may need to go to the page 2 to locate) for submitting your public comments and viewing supporting/related materials available for this rulemaking.

2. Mailing your comments to the following address:

Minerals Management Service
Offshore Energy and Minerals Management
Alternative Energy and Alternate Use Team
381 Elden Street Herndon, Virginia 20170-4817

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MMS Leasing Outer Continental Shelf for Wind & Wave Energy

MendoCoastCurrent, July 8, 2008

Act Now! Related ‘MMS Rulemaking’ Public Review & Comments Accepted Thru September 8, 2008

WASHINGTON, DC — The Minerals Management Service (MMS) announced today that it is proceeding with the consultation and analyses necessary to move toward the issuance of limited leases under its interim policy for authorizing alternative energy data collection and technology testing activities on the Outer Continental Shelf (OCS).

“This is another important step in the advancement in the OCS Alternative Energy Program,” said MMS Director Randall Luthi. “I am excited about our progress and am looking forward to working with the states and communities to move forward with these proposed activities.”

MMS announced its interim policy in November 2007 to jumpstart basic information gathering efforts relating to development of OCS alternative energy resources such as wind, waves, and ocean currents as authorized by the Energy Policy Act of 2005 (EPAct). The limited leases envisioned under the interim policy will be for a term of five years and will not convey any right or priority for commercial development.

Following the initial announcement, MMS received more than 40 nominations of areas proposed for limited leasing off the west and east coasts. In April MMS identified a subset of 16 proposed lease areas for priority consideration and provided public notice of those areas for the purpose of determining competitive interest as required by EPAct and for receiving relevant environmental or other information. The comment period on the April notice closed on June 30. A brief description of the information received and MMS’s decisions concerning the 16 proposed lease areas follows.

New Jersey, Delaware, and Georgia—the 10 lease areas (six off NJ, one off DE, and three off GA) proposed for site assessment activities relating to wind resources drew no competing nominations and no significant comment. MMS will proceed with a noncompetitive leasing process for these sites.

Florida—three of the four lease areas off the southeast coast proposed for site assessment or technology testing activities relating to ocean current resources received competing nominations, and comments concerning the areas were favorable. MMS will proceed with a noncompetitive leasing process for the one site that did not receive competing nominations. Due to timing constraints inherent in the interim policy, as well as bureau budget and staffing considerations, MMS has decided not to proceed with a competitive auction for the other areas. Instead, the competing nominators have been asked to collaborate in order to enable interested parties to jointly benefit in information gathering under leases issued noncompetitively.

California—neither of the two areas off Northern California (Humboldt and Mendocino Counties) proposed for site assessment and technology testing relating to wave resources drew new competing nominations. However, based on two original overlapping nominations in the Humboldt area from the initial Call for Nominations in Nov. 2007, MMS has determined that there is competitive interest in that proposed lease area. MMS also received numerous comments from local stakeholders concerned about potential use conflicts and environmental issues in both areas. For the Mendocino area, MMS has decided to proceed with a noncompetitive leasing process, working with the applicant and local stakeholders to refine the area and scope of proposed activities and to address other local concerns. For the Humboldt area, MMS has decided not to hold a competitive auction and to ask the competing nominators to collaborate. If they agree to collaborate, MMS will proceed with a noncompetitive leasing process as in the Mendocino area.

The process for issuing limited leases under the interim policy will entail thorough environmental analysis under the National Environmental Policy Act and related laws, as well as close consultation with federal, state, and local government agencies as required by EPAct.

The limited leases that will be issued under the interim policy will enable the lessees to collect information that will be useful for potential commercial projects in the future under an MMS regulatory program that is in development.

MMS published a proposed OCS alternative energy rulemaking on July 9, 2008. When final, this rule will govern all future commercial OCS alternative energy activities and will apply to any future commercial development in the areas leased under the interim policy. Limited leaseholders wishing to conduct commercial activities will need separate authorization under the final rule that is adopted.

The MMS interim policy is ongoing pending the adoption of a final rule governing OCS alternative energy activity. Interested parties may continue to submit nominations, and MMS may act on other nominations that already have been received or are received in the future.

Publisher’s Note: The MMS is seeking your comments on rulemaking for alternative energy projects…here’s their description: “The MMS is proposing regulations that would establish a program to authorize and manage alternative energy project activities on the OCS, as well as certain previously unauthorized activities that involve the alternate use of existing facilities located on the OCS; and would establish the methods for sharing revenues generated by this program with nearby coastal states”

Wish to Comment?

The proposed rule and draft environmental assessment invite public comments from interested parties by one of two methods:

1. Federal eRulemaking Portal. Under the tab “More Search Options,” click Advanced Docket Search, then select “Minerals Management Service” from the agency drop-down menu, then click “submit.” In the Docket ID column, select MMS-2008-OEMM-0012 (you may need to go to the page 2 to locate) for submitting your public comments and viewing supporting/related materials available for this rulemaking.

2. Mailing your comments to the following address:

Minerals Management Service
Offshore Energy and Minerals Management
Alternative Energy and Alternate Use Team
381 Elden Street
Herndon, Virginia 20170-4817

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