Energy Bill?s Hydro Relicensing Overhaul Gives Dam Owners a Leg Up

By Published On: December 14, 2003

The controversial federal energy bill passed by the House of Representatives November 18 was sent to the Senate, which failed to pass a motion for cloture that would force a vote on the bill. The legislation would ease the Federal Energy Regulatory Commission?s dam relicensing process for hydropower facility owners by requiring natural resources agencies to justify conditions aimed at protecting the environment. The controversial change, which some state agencies and conservation groups have attempted to defeat for months, would have the biggest impact on California. This state would be affected more than any other if the law passes because its hundreds of miles of rivers hold more than 200 dams that produce 14,116 MW of power. Over the next 15 years, 119 FERC-licensed hydro projects will be up for relicensing, many owned by Pacific Gas & Electric and Southern California Edison. The provision in the massive piece of federal legislation, promoted by Senator Larry Craig (D-Idaho), flips the burden of proof and requires agencies, including the U.S. Forest Service, the U.S. Fish and Wildlife Service, and the National Marine Fisheries Service, to defend their proposals requiring dam operators to protect fish and water quality. ?It is outrageous,? said Steve Wald, director of the California Hydropower Reform Network. The federal and state agencies, required by law to protect environmental resources, must also give equal weight to how their proposed licensing conditions affect the dam owners? costs and power output. At the same time, the bill allows only project operators?utilities, not downstream water agencies, Indian tribes, or others?to suggest alternatives for protecting an affected waterway and its aquatic wildlife. ?They get an extra bite at the apple,? according to Wald. The beneficiaries of the bill?s provision were, however, elated. ?We have long sought action on licensing reform and are pleased the bill addresses the most pressing issue facing the hydropower resource,? said Linda Church Ciocci, executive director of the National Hydropower Association. Unlike Edison and the Sacramento Municipal Utilities District, PG&E was not actively involved in the hydro provision?s development. ?We declined to participate because we are trying to work out a plan of reorganization? to emerge from bankruptcy, said Shawn Cooper, PG&E spokesperson. The reorganization plan pending in federal court seeks to eliminate the state?s authority over the utility?s dams. PG&E has nearly 4,000 MW of hydropower in this state, with four projects generating 584 MW up for relicensing in the next seven years. Edison has close to 1,200 MW of hydro generation, and projects pumping out 910 MW are up for relicensing in the next six to seven years. FERC has repeatedly undermined state resources agencies? authority to require water-quality and wildlife protections in the relicensing of dams, which occurs every few decades. One state agency official scoffed at the Republicans? rationale used to push the hydro revamp measure as a streamlining of the relicensing process. He noted the measure adds ?an extra procedure that is one-sided and weakens environmental standards.? Last May, Attorney General Bill Lockyer wrote Senator Jeff Bingaman (D-New Mexico) supporting his effort to tone down the measure. Lockyer backed the amendment because it would strike ?the appropriate balance among the many interests affected by hydropower relicensing,? wrote the AG. Last year, two heads of the resources agencies sent letters to California senators Dianne Feinstein and Barbara Boxer urging them to safeguard the state?s water-quality authority under the Clean Water Act that FERC was said to be pushing to eliminate. ?This is a once-in-a generation opportunity for California to bring nearly 50 percent of its hydropower system into compliance with modern environmental law,? wrote then-California Resources Agency head Mary Nichols and former Environmental Protection Agency secretary Winston Hickox. Much of the reason the controversial hydropower overhaul did not get more attention from federal lawmakers was because other provisions in the thick energy package were of greater concern. California?s senators have vigorously fought the exemption of liability for MTBE producers that have contaminated drinking water supplies and the ethanol mandate expected to drive up gasoline prices.

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