FERC Grants Pilot License to Verdant Power!

by Carolyn Elefant on February 22, 2012

fercsealI first posted about Verdant Power just a little more than seven years ago, when I reported on the company’s plans to place six tidal turbines in the East River. Eventually, Verdant Power did just that, and used its experience in real water conditions to further refine its technology. Subsequently, Verdant was one of the first company’s to avail itself of FERC’s pilot license process.

Seven years since my first post, Verdant’s efforts have paid off. On January 23, 2011, FERC awarded Verdant a ten year pilot license , the first ever issued by FERC according to this news release. Here are a couple of quick observations about the license:

1. Verdant filed its application at the end of 2010, and FERC noticed the application on February 2, 2011. FERC’s January 23, 2012 license issuance is thus within the one year time frame that FERC intended when it developed the pilot process. Of course, from Verdant’s perspective, the licensing project took far longer than year; as noted, Verdant has been developing the project and license application since at least 2005.

2. The state of New York issued a Section 401 water quality certificate and CZMA consistency finding within the timeframes provided by statute and in both cases, within less than a year after Verdant filed its applications. Frequently, the CZMA or Section 401 process can take longer since the state agencies will often ask for additional information before they start the clock on processing. Apparently, that added time wasn’t needed here. However, (and without having seen the state certificates), my guess is that because Verdant had an opportunity to test the project and generate actual data on operations, it had real evidence of minimal impacts.

3. Even though Verdant received a pilot project, FERC applied its traditional Section 10 licensing analysis under the FPA, giving equal consideration to environmental impacts and energy benefits, and evaluating whether the project is best adapted to the comprehensive plan for the waterway. Under Section 10, FERC also evaluates project economics and while early stage demonstration projects are unlikely to be economic, FERC found that the project’s real value comes in its demonstration of a promising new technology.

4. Under Section 10, FERC must also give heightened consideration to recommendations by fish and wildlife agencies, known as “Section 10(j)” recommendations. Somewhat surprisingly the agencies did not present Section 10(j) recommendations, which is a testament to the level of consensus that must have been achieved in the process.

5. The monitoring plan incorporated into the Pilot License is extensive and detailed. The data generated will advance the public’s collective knowledge of the impacts and promise of MHK while ensuring against any possibility of adverse effects during the license term.

In short, the license process may be over for Verdant, but there’s still plenty of hard work ahead. Let the new challenges begin!

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