FERC-DOI Signal Truce on Dispute over Renewable Projects on OCS

The US Department of the Interior (DOI) and the Federal Energy Regulatory Commission (FERC) announced an agreement in principal to resolve a longstanding inter-agency dispute over jurisdiction to regulate hydrokinetic power generation on the outer continental shelf (OCS).

Although limited to the regulation of hydrokinetics (see earlier report below), the dispute effectively stymied development of all OCS renewable energy projects because it brought DOI's permitting processes to a standstill. As a consequence, both agencies have come under increasing pressure by Capital Hill to resolve their conflicting jurisdictional claims. The announcement today coincides with a hearing convened by the Senate Energy and Resources Committee at which DOI Secretary Salazar is expected to be grilled concerning the jurisdictional dispute.

Significantly, the agreement embraces concurrent jurisdiction-"”an idea publicly espoused months ago by then Commissioner and now acting FERC Chairman John Wellinghoff"”wherein FERC will have the lead permitting role under Part I of the FPA and DOI will have the authority to include mandatory conditions in any FERC-issued license authorizing a hydrokinetic power generation project. According to the government's press release: "FERC will have the primary responsibility to manage the licensing of such projects in offshore waters pursuant to the Federal Power Act, using procedures developed for hydropower licenses, and with the active involvement of relevant federal land and resource agencies, including the Department of the Interior."

Details of the division of permitting responsibilities between DOI and FERC have not yet been finalized; but, it is expected that a forthcoming Memorandum of Understanding between the two agencies will clarify the process going forward.