On December 20, 2022, the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) in Waterkeepers Chesapeake, et al. v. FERC vacated a FERC order approving the relicensing of the Conowingo Dam because FERC did not have the authority to issue the license under section 401 of the Clean Water Act (“CWA”). Specifically, the court found that FERC may only issue a license if the state issues a water quality certification for the dam or waives its right to do so. Here, the court emphasized that when the Maryland Department of Environment (“Department”) rescinded its water quality certification for the project subject to a settlement agreement, the recission did not constitute a waiver, and thus FERC did not have the authority to issue the dam’s new license under the act.
Hydropower
Biden Names Willie Phillips Acting Chairman of FERC
On January 3, 2023, President Joe Biden named Willie Phillips acting chairman of FERC. Chairman Phillips first joined the Commission in December 2021 after being nominated by President Biden and confirmed by the Senate. His term expires June 30, 2026.
U.S. Court of Appeals for the 9th Circuit Affirms Lower Court’s Dismissal of Tribe’s Case Against City of Seattle
On December 30, 2022, the U.S. Court of Appeals for the 9th Circuit (“9th Circuit”) affirmed a lower court’s denial of the Sauk-Suiattle Indian Tribe’s (“Tribe”) motion to remand to state court and its dismissal of the Tribe’s action against the City of Seattle (“City”) for lack of subject matter jurisdiction. The case concerns Gorge Dam, which is located on the Skagit River in Washington and is one of three dams that make up the City’s Skagit River Hydroelectric Project (“Skagit River Project” or “Project”).
Funding Begins for Hydropower Research and Development and Fish Passage
In December 2022, several federal agencies announced awards and recommendations for Bipartisan Infrastructure Law (BIL) funding. The BIL represents a core piece of President Biden’s agenda and provides significant funding for infrastructure improvements in energy and water, including over $900 million in waterpower incentives for new and existing hydropower, pumped storage, and marine energy. Funding is also provided to incentivize research, development, demonstration, and commercial application (R&D) efforts in the water power industry for technologies that improve capacity, efficiency, resilience, security, reliability, affordability, and environmental impact.
Hydropower: 2022 Lookback and 2023 Trendspotting
2022 was an active year for the hydropower industry, and as 2023 begins, it’s appropriate to review last year’s highlights and forecast the anticipated trends to continue this year.
Tenth Circuit Resolves Jurisdictional Dispute, Finds FPA Jurisdictional Limit Does Not Apply to Non-FERC Agency Orders
On September 30, the U.S. Court of Appeals for the Tenth Circuit issued an opinion in Save the Colorado, et al. v. Spellmon. The case arose from various conservation group challenges to the U.S. Army Corps of Engineers (Corps) and U.S. Fish and Wildlife Service’s (Service) decision to grant the city and county of Denver, acting through its Board of Water Commissioners (Denver Water or municipality), a discharge permit to expand the reservoir of its Gross Reservoir Hydroelectric Project, which is licensed by the Federal Energy Regulatory Commission (FERC or Commission). The central issue revolved around whether the U.S. courts of appeals have exclusive jurisdiction over challenges to non-FERC decisions arising under statutes related to the development of hydropower projects under the Federal Power Act (FPA). The Tenth Circuit ultimately held that petitions against orders by non-FERC agencies do not warrant exclusive jurisdiction in the U.S. courts of appeals.
DOE Announces $13.5M Distribution to Hydroelectric Facilities Through the Hydroelectric Production Incentive Program
On September 9, the U.S. Department of Energy (DOE) announced that it would distribute $13.5 million to incentivize hydroelectric generation in the United States. The financial support is part of the Hydroelectric Production Incentive Program, which provides funding for electricity generated and sold from dams and other water infrastructure projects that will add to or expand hydropower generation.
Senator Manchin’s Permitting Reform Bill Pulled From the Continuing Resolution
On September 21, Senator Joe Manchin (D-WV), Chairman of the Senate Energy and Natural Resources Committee, released the text of the Energy Independence and Security Act of 2022 (Act). This comprehensive Act was set to be included in the upcoming Continuing Resolution; however, on September 27, Manchin pulled the Act from the Continuing Resolution given bipartisan opposition. The Act sought to improve energy production in the United States by accelerating agency review of certain energy projects and modernizing permitting laws.
Department of Energy Issues Request for Information on Hydropower Funding Provisions
As we previously reported, the Infrastructure Investment and Jobs Act, also known as the Bipartisan Infrastructure Law (BIL), which President Biden signed into law on November 15, 2021, included over $900 million in waterpower incentives for new and existing hydropower, pumped storage, and marine energy. Specifically, the BIL provided additional funding for the existing incentive programs established by Sections 242 and 243 of the Energy Policy Act of 2005 (EPAct 2005) and created a new incentive program to maintain and enhance hydroelectricity through improvements to grid resiliency, dam safety, and the environment under Section 247 of EPAct 2005.
FERC Equity Action Plan and Hydropower Licensing
On April 15, 2022, the Federal Energy Regulatory Commission (FERC) issued an Equity Action Plan (EAP) that introduces a two-year overhaul to review its policies to better promote equity and remove barriers to environmental justice communities. In particular, for hydropower projects, the EAP will focus on: (1) building and staffing its new Office of Public Participation, (2) strengthening Tribal government consultation and engagement policies and processes, (3) reviewing key regulations within the hydropower project licensing process, and (4) implementing equity readiness for staff to understand the EAP mission.