USACE FERC License Conditions and Recommendations (7-FD-r)
The U.S. Army Corps of Engineers (USACE) has authority to manage federally owned dams and the nation’s navigable waterways under the Rivers and Harbors Act (RHA). The Federal Power Act (FPA) authorizes Federal Energy Regulatory Commission (FERC) to license non-federal hydropower projects including those projects utilizing a federally owned dam or other facility even where Congress has not authorized power development as a project purpose. The Memorandum of Understanding Between United States Army Corps of Engineers and the Federal Energy Regulatory Commission on Non-Federal Hydropower Projects (2011 MOU) signed by both FERC and USACE sets forth the framework for coordinated implementation of regulatory processes under, among other federal statutes, the FPA and RHA for authorizing construction and operation of non-federal hydropower projects.
Generally, the FPA does not preempt USACE’s authority to manage navigable waterways under RHA Section 10 or to operate federally owned dams under RHA Section 14. Rather, under FPA Section 4(e), USACE has authority to impose mandatory conditions on FERC issued licenses to enforce applicable statutory and regulatory requirements such as those found in the Rivers and Harbors Act and 33 CFR Part 221. In addition, USACE may submit recommendations under FPA Section 10(a) to ensure the project is constructed in the public interest and in conformance with its other responsibilities such as those to flood management control (33 CFR 221.1(g)).
USACE FERC License Conditions and Recommendations Process
7-FD-r.1 – Initiate Investigation of License Application
Upon referral by FERC, USACE will initiate investigation of hydropower license applications (see 33 CFR 221.1(f)). To initiate the investigation, USACE will assign the investigation to the appropriate Division Engineer. The investigation will include, among other analyses, analysis of aspects of the project affecting USACE authorized functions under the FPA and RHA including the necessity of any license conditions to protect the interests of navigation. A detailed list of considerations can be found at 33 CFR 221.1(f)(1).
7-FD-r.2 – Will the Proposed Project be Located on or Affect a US Army Corps of Engineers Operated Facility?
If the proposed hydropower project will be located on, or could affect the structural integrity or operation of, a USACE operated facility, then the developer must obtain a Section 408 permit from USACE for the alteration, occupation, or use of a federally owned dam under Section 14 of the Rivers and Harbors Act of 1899 (33 U.S.C. § 408) (see also 2011 MOU Section III(C). Under the 2011 MOU, USACE has agreed to facilitate development of hydropower by non-federal entities at suitable federally owned projects where FERC issued licenses are found to be compatible with the purposes for which Congress authorized the project, and where there is no federal interest in developing hydropower at the facility (2011 MOU Section IV(B)). When the developer obtains a Section 408 permit, USACE will impose mandatory conditions on the FERC issued license under FPA Section 4(e) (see 16 U.S.C. § 797(e)). USACE will exercise its authority to approve the final design with regard to impact on navigation under FPA Section 4(e) (2011 MOU Section VII(A)(2)). In addition, USACE may submit recommendations under FPA Section 10(a) to ensure the project is constructed in the public interest and in conformance with its other responsibilities such as those to flood management control (33 CFR 221.1(g)).
If the proposed hydropower project will affect navigable waters of the United States, the developer must obtain authorization from USACE under Section 10 of the Rivers and Harbors Act of 1899 (33 U.S.C. § 403) (see also 2011 MOU Section III(B)). However, USACE has the authority to impose mandatory conditions under FPA Section 4(e) in lieu of issuing a Section 10 permit under the RHA (2011 MOU Section VII(D)). Under FPA Section 4(e), FERC may not issue a license affecting the navigable capacity of any navigable waters of the United States until the plans of the dam or other structures affecting the navigation have been approved by USACE (16 USC 797(e)). USACE will exercise its authority to approve the final design with regard to impact on navigation under FPA Section 4(e) (2011 MOU Section VII(A)(2)). In addition, USACE may submit recommendations under FPA Section 10(a) to ensure the project is constructed in the public interest and in conformance with its other responsibilities such as those to flood management control (33 CFR 221.1(g)).
RHA Section 10 requires USACE authorization for the construction of any structure in or over any navigable water of the United States (33 USC 403). Under RHA Section 10 this includes, structures or work outside the limits defined for navigable waters of the United States if the structure or work affects the course, location, or condition of the water body (2011 MOU Section III(B)). The law applies to any dredging or disposal of dredged materials, excavation, filling, re-channelization, or any other modification of a navigable water of the United States, and applies to all structures, from the smallest floating dock to the largest commercial undertaking. It further includes, without limitation, any wharf, dolphin, weir, boom breakwater, jetty, groin, bank protection (e.g. riprap, revetment, bulkhead), mooring structures such as pilings, aerial or sub-aqueous power transmission lines, intake or outfall pipes, permanently moored floating vessel, tunnel, artificial canal, boat ramp, aids to navigation, and any other permanent, or semi-permanent obstacle or obstruction (2011 MOU Section III(B)).
7-FD-r.4 – Determine 10(a) Recommendations
If USACE requires neither a Section 10 permit nor a Section 14 permit under the RHA, then USACE still has authority under FPA Section 10(a) to submit to FERC recommendations which must be considered by FERC when making the licensing decision. For example, USACE may submit recommendations to FERC in regards to matters such as environmental aspects of a project or the redevelopment of an existing project.
Under FPA Section 10(a), USACE may submit recommendations to be considered by FERC when issuing a hydropower license, to ensure the project will be best adapted to a comprehensive plan for "improving or developing a waterway or waterways for the use or benefit of interstate or foreign commerce, for the improvement and utilization of water-power development, for the adequate protection, mitigation, and enhancement of fish and wildlife (including related spawning grounds and habitat), and for other beneficial public uses, including irrigation, flood control, water supply, and recreational and other purposes” (16 USC 803(a)). USACE will utilize recommendations submitted under FPA Section 10(a) to recommend “a plan of hydropower construction, considering and seeking potential non-federal partnership arrangements, that would best use the site power potential that is compatible with the multiple waters resources use for the public benefit” (ER 1110-2-1454 Paragraph 14(b)(1)). Recommendations will be based on the technical and operational merits of the non-federal hydropower proposal, and the best available data and information from USACE completed feasibility studies (ER 1110-2-1454 Section 14(b)(2)).
7-FD-r.5 – Determine 4(e) Conditions and 10 (a) Recommendations
Under prescribed circumstances, the FPA authorizes USACE to impose mandatory conditions on FERC issued licenses and submit recommendations to be considered by FERC when developing hydropower licenses. In addition to standard license terms and conditions 33 CFR 221.1, Appendices A and B, USACE will develop project specific conditions under FPA Section 4(e) and recommendations under FPA Section 10(a). USACE has approval authority under FPA Section 4(e) for design, plans, and construction specifications of licensed non-federal hydropower facilities that will be an integral part of or that could affect the structural integrity or operation of a Corps project (see ER 1110-2-1454 Paragraph 7). USACE will determine 10(a) recommendations as described above in 7-FD-r.4.
Under FPA Section 4(e), USACE has authority to impose mandatory conditions on FERC issued licenses for both non-federal hydropower development on a USACE operated facility and for non-federal hydropower development that could affect the structural integrity or operation of a USACE operated facility (16 USC 797(e)). Hydropower projects on or affecting USACE operated facilities must be designed and constructed in consultation with and subject to USACE’s authority under RHA Section 408 (2011 MOU Section VII(A)(1)). USACE’s approval of the final design with regard to impact on navigation will be exercised under FPA Section 4(e) for all proposed non-federal hydropower facilities (2011 MOU Section VII(A)(2)). When developing license conditions and recommendations, USACE will use the design and environmental information the developer has provided to FERC for its license process (2011 MOU Section IV(B)(1)).
7-FD-r.6 – Application Report
USACE investigation of FERC license applications results in an Application Report, which is submitted to FERC (see 33 CFR 209.140(c) et seq.). Application reports drafted by USACE will include license conditions and recommendations submitted under USACE’s authority under FPA Sections 4(e) and 10(a) (33 CFR 209.140(c)(4)). Application reports will also describe and discuss material facts having a definite bearing on the interests of navigation and flood control and the project would have on a comprehensive plan of developing the water resources of the basin (33 CFR 209.140(c)(3)).
Under 33 CFR 209.140(c)(6), if the project is on a federal reservation or contemplates the use of a dam, either of which is under USACE jurisdiction, the report should state, giving reasons:
- (i) Whether the project will interfere or be inconsistent with the purpose for which such reservation was created or acquired and what conditions, if any, should be imposed for the adequate protection and utilization of the reservation;
- (ii) Whether the dam may be advantageously used by the United States for public purposes in addition to authorized purposes and whether it should be reserved for such use; and
- (iii) Whether the development should be undertaken by the United States.
7-FD-r.7 to 7-FD-r.9 – Does USACE Recommend Establishing a Memorandum of Agreement (MOA)?
Upon recommendation by USACE, FERC will require licensees to enter into a Memorandum of Agreement (MOA) with USACE describing the mode of hydropower operation acceptable to USACE (2011 MOU Section VII(A)(9)). FERC licenses for non-federal projects at USACE operated facilities will require the licensee to develop an MOA with USACE. As parties to the MOA, the developer and USACE will negotiate the terms of the MOA. The MOA will describe the detailed operation of the project acceptable to the USACE and any restrictions needed to protect the purposes of the federal facility.
7-FD-r.10 to 7-FD-r.11 – Does the Developer Seek to Challenge a Disputed Issue of Material Fact?
Section 241 of Energy Policy Act of 2005 (EPAct 2005) amended section 4(e) of the Federal Power Act to provide that any party to a license proceeding may seek a determination on the record, after opportunity for an agency trial-type hearing of no more than 90 days, of any disputed issues of material fact with respect to any agency’s mandatory conditions (16 USC 797(e)). As of the drafting of this section no developer has sought to utilize this process in regards to a USACE decision and there is uncertainty as to whether this amendment applies to USACE’s authority to condition FERC licenses.
7-FD-r.12 to 7-FD-r.13 – Does the Developer Seek to Propose any Alternative Conditions?
Section 241 of EPAct 2005 added section 33 to the Federal Power Act allowing the license applicant or any other party to the licensing proceeding to propose an alternative condition (16 USC 823d(a)(1)). As of the drafting of this section no developer has sought to propose an alternative to a USACE condition and there is uncertainty as to whether this amendment applies to USACE’s authority to condition FERC licenses.
7-FD-r.14 – Continue with FERC Licensing Process
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