OREC Offers Support, and Constructive Comments on FERC’s Conditional License Policy

In November 2007, the Federal Energy Regulatory Commission issued a Policy Statement announcing the Commission’s intent to issue conditional licenses for certain wave, tidal and hydrokinetic projects. The conditional license would enable FERC to approve the license, without waiting for other state and federal agencies to issue necessary authorizations. But the conditional license does not authorize any construction until the licensee obtains final approvals from other state and federal agencies. FERC anticipates that the conditional license will facilitate financing and allow licensees to move forward with other, non-construction related duties under the license, such as convening stakeholder meetings or developing monitoring plans.OREC generally supported the FERC’s efforts, in these comments.  However, OREC expressed some concerns about the potential for abuse of the conditional license without continuing oversight by FERC. And OREC asked FERC to clarify that developers who failed to meet the statutory deadline for commencement of construction would not lose the license where other agencies’ failure to grant necessary authorizations caused delay.

OREC Secures Some Benefits for Ocean Energy in New Energy Bill…But Tax Credits Must Wait Until Next Year

On December 19, 2007, President Bush signed into law the Energy Act 2007. OREC played an instrumental role in securing important benefits for the ocean and marine renewable energy industry, including:

* Authorizing $250 million for Research, Development, Demonstration and Commercial Application to Expand Marine and Hydrokinetic Renewable Energy Production.

* Authorizing the Secretary of the Department of Energy to Establish National Marine Renewable Energy Research, Development and Demonstration Centers.

* Directing the Department of Energy to Conduct a Report on Environmental Impacts and Recommendations to Mitigate Environmental Impacts.
While these provisions will help the marine renewables industry move forward, disappointingly, the Energy Act 2007 did not include other provisions which would have helped not just marine renewables, but all forms of renewable energy. For example, the Energy does not expand the Production Tax Credit (PTC) to include marine renewables (which currently do not qualify for the PTC), nor did the legislation extend the PTC, now due to expire at the end of 2008, for other renewables. Also missing from the bill was a national Renewable Portfolio Standard (RPS)that would have required utilities to obtain a mandatory percentage of their power supply from renewable energy sources.

Finally, one version of the bill would have resolved the ongoing jurisdictional spat between the Federal Energy Regulatory Commission and the Mineral Management Service. The final Energy Act did not include this provision, which means that MMS and FERC are likely to continue to work on the terms of an MOU that would delineate each agency’s role in authorizing marine renewable projects on the Outer Continental Shelf.

To read OREC’s official statement, visit this link.