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Posts Tagged ‘Federal Power Act’

MendoCoastCurrent, June 24, 2010

Public institutions and private sector organizations from across the country should form a coalition to help states, localities and regions develop and deploy successful and cost-effective electric demand response programs, a new Federal Energy Regulatory Commission (FERC) staff report says.

The coalition effort is the centerpiece of the National Action Plan on Demand Response Report , issued today, that identifies strategies and activities to achieve the objectives of the Energy Independence and Security Act of 2007.

“There is strength in numbers. Coalitions harness the combined energy of individual organizations, producing results that can go far beyond what can be accomplished on an individual basis,” FERC Chairman Jon Wellinghoff said. “The success of this National Action Plan depends on all interested public and private supporters working to implement it.”

The public-private coalition outlined in the National Action Plan would coordinate and combine the efforts of state and local officials, utilities and demand response providers, regional wholesale power market operators, electricity consumers, the federal government and other interest groups. Demand response refers to the ability of customers to adjust their electricity use by responding to price signals, reliability concerns or signals from the grid operator. Demand response is a valuable resource for meeting the nation’s energy needs.

The 2007 law required FERC to identify the requirements for technical assistance to states so they can maximize the amount of demand response that can be developed and deployed; design and identify requirements for a national communications program that includes broad-based customer education and support; and develop or identify analytical tools, information, model regulations and contracts and other materials for use by customers, states, utilities and demand response providers.

The National Action Plan applies to the entire country, yet recognizes Congress’ intent that state and local governments play an important role in developing demand response. It is the result of more than two years of open, transparent consultation with all interested groups to help states, localities and regions develop demand response resources.

The National Action Plan on Demand Response is available at here.

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EVAN LEHMANN, The New York Times, March 17, 2009

The oceans might not be big enough for sharp-elbowed renewable energy developers. Aspiring power producers are claiming sweeping stretches of sea along the East Coast, sometimes overlapping each other and igniting modern-day allegations of “claim jumping.”

Open water miles from shore is the newest frontier for prospectors, as vague notions persist about who in the federal government presides over the ocean depths. A jurisdictional dispute between two federal agencies — the Department of Interior’s Minerals Management Service and the Federal Energy Regulatory Commission — is encouraging a “Wild West” atmosphere, as one participant described the accelerating race to grab chunks of seafloor for energy development.

The impasse has led competing prospectors to claim the same areas of ocean off New Jersey’s coast, citing authority from different federal agencies. Wind developers are accusing Seattle-based Grays Harbor Ocean Energy Co. of taking advantage of the regulatory uncertainty to snatch a 200-square-mile swath of ocean for a proposed wave and wind energy project through FERC.

Smaller patches within that area had already been identified for wind farms approved by the state and been given a preliminary green light by MMS.

“They are all around us,” Chris Wissemann, founder of Deepwater Wind, said of Grays Harbor. State regulators awarded development rights to Deepwater Wind last fall to build a 350-megawatt wind farm about 20 miles off the shore with PSEG Renewable Generation.

But now the Grays Harbor site is “completely overlapping” the smaller 20-square-mile area of ocean identified by Deepwater Wind, Wissemann added, noting that his project is at “full stop.” The sprawling Grays Harbor parcel also encompasses a second wind project, proposed by Bluewater Wind, which plans to erect about 100 turbines over 24 square miles.

Wind developers and state officials are pressing FERC to deny Grays Harbor’s permit. A decision could come this spring.

‘Wild West’ goes to sea

The confusion is the offspring of dueling federal agencies. The Minerals Management Service is generally considered the landlord of the ocean floor, and has been working for three years on new rules to provide leases for wind farms on the outer continental shelf. There is no dispute about its authority over wind projects, as outlined in the Energy Policy Act of 2005.

But the Federal Energy Regulatory Commission has been arguing for two years that it maintains jurisdiction over hydrokinetic projects — those that tap the power of waves and currents — under the Federal Power Act.

That leaves developers of both wind and wave technologies vulnerable to each other. Preliminary permits are easy to get, and that can lead to “a lot of gamesmanship” in areas known to have good energy prospects, said Carolyn Elefant, a lawyer with the Ocean Renewable Energy Coalition.

“There are a lot of people who have these visions of flipping sites, selling sites, jumping claims and making people buy them off,” she said. “It’s the Wild West.”

That “back and forth” struggle between the two agencies stalled the release of MMS’s new rule on offshore renewable energy projects at the close of George W. Bush’s presidency, according to Michael Olsen, a former deputy assistant secretary in the Interior Department, who worked on the rule. Developers say the delay has prevented the offshore industry from growing.

“There was a tremendous push at the end of the last administration” to finalize the rule, Olsen said an event sponsored by the Energy Bar Association yesterday. “And it was delayed because of this dispute.”

‘Permit flippers’ vs. ‘mafiosos’

Grays Harbor is at the center of that storm. Run by Burton Hamner, who has experience in coastal management, the company in October plunged into the race to build the first offshore power generation project on the East Coast.

It applied for six interim leases from FERC, a move that would give it priority over hundreds of square miles off the coasts of Massachusetts, New Jersey, Rhode Island and several other states. The move could essentially secure those areas for three years, sidelining other wind companies that had already gone through a competitive selection process with the state of New Jersey and that are now waiting on the MMS rule before moving forward.

“I could literally have my equipment on a boat and receive a letter from FERC saying, ‘You have no right to do this because we have a competing set of regs,'” said Wissemann of Deepwater Wind, which might wait to build a data-collecting test tower until the dispute is settled.

A group of nine U.S. lawmakers, mostly from the East Coast, assailed Grays Harbor’s move — without mentioning the company — as “claim jumping” in a letter last week to Interior Secretary Ken Salazar. Some wind developers are furious, saying Hamner is “site banking” stretches of ocean with an eye toward trading in real estate, not clean energy.

“They’re looking to flip the permits,” said one official with a wind developer.

But Hamner dismisses those accusations as if they’re insults from entitled lawmakers or bested competitors acting like bossy “New Jersey mafiosos.”

Salazar pushing for a fix

He describes his maneuvering as a good business decision, one that fits within existing rules. He is not a claim jumper, he says, because MMS has not issued the rule needed to receive leases — an assertion with which his competitors have no choice but to agree.

“You can’t say somebody else is claim jumping when you haven’t in fact made a claim,” Hamner said. “All they’re doing is sitting there on the shore saying, ‘Hey, we were here first. What’s this guy doing messin’ in our sandbox?'”

He is unapologetic about applying for interim permits under FERC, days after the commission underscored its jurisdiction over hydrokinetic (wave power) projects in October. Nor does he feel burdened by exploiting the turf battle in Washington. FERC, he says, is the rightful overseer of electricity projects.

“They could have done the same thing that I did,” Hamner said of other developers. “The ocean’s got a lot of opportunity. There’s room for everybody. What we don’t want to have is people standing on the shore who’ve got the attitude of New Jersey mafiosos saying that’s their playground.”

Hamner is eligible for a FERC permit because he’s emphasizing wave power. At each of his seven sites, he proposes raising 100 platforms, each with three legs. Every leg will carry a 330-kilowatt generator, providing about 10% of the 1,100 megawatts produced by each project. Hamner plans to find the bulk of his electricity through wind turbines, big, 10-megawatt units on each platform.

The territorial dispute, meanwhile, is rising to a new level of urgency in Washington. Salazar said he hopes to draft a long-delayed memorandum of understanding with FERC, perhaps as soon as today. That could prevent the agencies from “stumbling over each other,” he told reporters on a conference call yesterday.

“We will not let any of the jurisdictional turf battles in the past get in the way with moving forward with our energy agenda,” Salazar said.

The MMS rule regarding leases could follow soon if the inter-agency dispute is settled. That’s considered a key requirement for sparking a robust offshore industry.

“They just need to work it out,” said Laurie Jodziewicz, manager of siting policy for the American Wind Energy Association. “We have some real projects that are being held up right now.”

Yet Olsen, the former official with Interior who worked on the rule, expressed doubt yesterday that Salazar would be able to quickly disarm the two sides. Congress might have to draft new legislation, he predicted, or perhaps President Obama’s new energy czar, Carol Browner, could muscle a jurisdictional remedy into place.

“It’s going to be the same thing,” Olsen said, recalling past challenges to fixing the problem. “Something’s gotta happen.”

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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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MendoCoastCurrent, September 9, 2008

Fort Bragg, California City Council has filed a lawsuit against the Federal Energy Regulatory Commission (FERC) in the Washington D.C. Circuit Court of Appeals.

Concerns escalated last August when FERC denied Fort Bragg’s second request for a rehearing on FERC’s national licensing policies for wave energy or hydrokinetic energy projects. The community stakeholders, Fort Bragg, Mendocino County, Lincoln County (Oregon) and Fishermen Interested in Safe Hydrokinetics (FISH), were also denied rehearing by FERC. Under the Federal Power Act, there are no administrative appeals left and the only recourse is a lawsuit.

Fort Bragg contests FERC’s energy development process for national licensing of wave energy projects, including the proposed Pacific Gas & Electric wave energy pilot project off the coast of Fort Bragg.

The contested policies were established in two informal documents issued by FERC in April 2008 entitled Staff Guidance on Hydrokinetic Pilot Procedures” and “Staff FAQs on Conditional Licenses.”

Fort Bragg contends that FERC established these policies without complying with a number of federal laws including the Coastal Zone Management Act, Clean Water Act, National Environmental Policy Act and the Administrative Procedure Act.

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