Congress recognizes impact of maintenance costs at hydropower facilities
American’s Water Infrastructure Act 2018 includes changes to dam license term determinations
Today there is greater recognition that existing hydropower facilities’ maintenance costs must be considered when reviewing relicense terms. This is evidenced by Congress’ passing of America’s Water Infrastructure Act of 2018 that includes several amendments to Part 1 of the Federal Power Act.
The AWIA 2018 was signed into law by President Trump on October 23rd. It allows the Federal Energy Commission – for the first time – to consider a facility’s maintenance costs that were incurred during the previous license period when determining the duration of the new license.
It was a big step forward for longer licensing terms when FERC approved its revised guidance in October 2017 (see FERC takes action on hydroelectric project license terms). However, in that guidance maintenance measures and measures to support relicensing would not be considered in determining if a license duration of greater than 40 years was appropriate. The items to be considered were restricted to non-developmental or volunteer items and power enhancing items that were not required by the licensee or other legal authority.
If signed, Section 3005 of AWIA allows voluntary, current license expenditures – that do not fit into the environmental, recreation and water supply categories – to be considered in determining the term of the new license. These new expenditure categories now have the same weight as the expenditures anticipated in the new license.
Section 3005 also includes a provision for a licensee to request the FERC to give a determination if any planned, ongoing or completed investment under the current license meets the criteria to be considered in determining the duration of the new license. The FERC must provide the determination within 60 days of the licensee request.
This action may be subtle, but to me it signifies recognition that major expenditures occur regularly at existing hydroelectric facilities. Often these expenditures are large projects to address dam safety-related items that were recommended by the Division of Dam Safety and Inspections. In the past these have not been considered during the relicensing process to determine the length of the subsequent license.
What are your thoughts? How will AWIA 2018 affect your facility relicensing?
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