A project may be transferred to federal ownership if the U.S. provides notice two years before license expiration and if the licensee is paid fair market value1 and any damages.2 Upon such takeover, the project exits FERC's jurisdiction, which is limited to non-federal licensees, even if the project continues to be operated for generation. Such takeover has occurred once.3
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16 U.S.C. § 807(a).
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Id.; see In re Pacific Power and Light, 23 FERC ¶ 63,037 (April 28, 1983); In re Escondido Mutual Water Co., 9 FERC ¶ 61,189 (Feb. 26, 1979). Severance damages are relatively inconsequential.
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The James River Corporation and Daishowa Corporation built the Elwha and Glines Canyon Projects, in 1910 and 1926 respectively, on the Elwha River to power to a paper mill on Lake Mills. When the projects began relicensing in the 1970s, FERC was urged by conservation groups, NMFS, and the Elwha Tribe to deny a new license and instead require decommissioning, due to blocked passage for salmon runs and degraded riparian vegetation and wildlife habitat downstream. The 1991 DEIS concluded that decommissioning was feasible and was the only option that would completely restore the degraded Elwha River. In 1992, Congress enacted the Elwha River Ecosystem and Fisheries Restoration Act, 102 P.L. 495 (1992), which removed FERC's jurisdiction to process the applications in these dockets, but left residual jurisdiction to preserve the status quo. In 2000, the National Park Service and the Bureau of Reclamation purchased the projects from the licensee, Fort James Corporation, for $29.5 million. On March 10, 2000, following the transfer of title, FERC announced that its jurisdiction over these projects was fully extinguished. See “Notice Terminating Proceedings,”90 FERC ¶ 61,235 (Mar. 20,2000). The federal agencies now operate the projects and will continue to do so until decommissioning begins in 2007. For further information, see http://www.nps.gov/olym/parknews/elwha-restoration-project-update.htm.
