Energy futureFERC issues conditional licenses for ocean energy projects

Published 19 December 2007

New policies allows FERC to issue licenses for new hydrokinetic projects even though certain authorizations required from other entities are outstanding

The Federal Energy Regulatory Commission (FERC) issued a policy statement which allows the commission to issue conditioned licenses for hydrokinetic energy projects under appropriate circumstances. The policy statement covers projects that use currents, waves and tides to generate renewable electric energy. It allows FERC to issue licenses for new hydrokinetic projects even though certain authorizations required from other entities are outstanding. Licenses issued under these circumstances would include conditions precluding the licensee from starting construction until it has obtained all necessary authorizations. The policy statement is consistent with FERC’s approach to approving certificates for natural gas pipelines and authorizations for liquefied natural gas (LNG) facilities under the Natural Gas Act. FERC issues authorizations for these projects while applicants are still awaiting the issuance of permits from other federal and state entities.

Issuing conditioned licenses for hydrokinetic technologies will have no environmental impact, will not diminish the authority of the states or other federal agencies, and will improve the ability of project developers to secure financing of demonstration projects, FERC said. In December 2006 the commission held a technical conference on hydrokinetics to hear from state and federal agencies, tribes, developers and stakeholders. As a result of that conference, FERC on 15 Februrary 2007, issued a notice of inquiry and interim policy statement adopting a “strict scrutiny” approach to reviewing preliminary permits. On 2 October 2007 FERC conducted a commissioner-led technical conference in Portland, Oregon, to discuss a pilot project license process the commission staff introduced in July 2007 which expedited the licensing process for certain hydrokinetic project proposals. Public comment was received from interested parties throughout all of these steps and reviewed by the commission