Hydropower represents approximately 20% of the world’s energy supply, is viewed as both vulnerable to global climate warming and an asset to reduce climate altering emissions, and is increasingly the target of improved regulation to meet multiple ecosystem service benefits. It is within this context that the recent decision by the United States Federal Energy Regulatory Commission to reject studies of climate change in its consideration of reoperation of the Yuba-Bear Drum-Spaulding hydroelectric facilities in northern California is shown to be poorly reasoned and risky. Given the rapidity of climate warming, and its anticipated impacts to natural and human communities, future long-term fixed licenses of hydropower operation will be ill prepared to adapt if science-based approaches to incorporating reasonable and foreseeable hydrologic changes into study plans are not included. The licensing of hydroelectricity generation can no longer be issued in isolation due to downstream contingencies such as domestic water use, irrigated agricultural production, ecosystem maintenance, and general socioeconomic well-being. At minimum, if the Federal Energy Regulatory Commission is to establish conditions of operation for 30-50 years, licensees should be required to anticipate changing climatic and hydrologic conditions for a similar period of time.

In April 2009, the U.S. Department of the Interior (Interior) and Federal Energy Regulatory Commission (FERC) entered into a Memorandum of Understanding (MOU) regarding the development of hydrokinetic and renewable energy projects on the Outer Continental Shelf (OCS). While the MOU resolved a long-standing jurisdictional impasse between the agencies, there remain unresolved regulatory matters regarding the approval and oversight of these emerging technologies. Now that the agencies have resolved the jurisdictional matter and committed to work together on this matter, however, such matters may be further resolved in a manner that would promote development of this vast renewable energy resource.

The federal licensing or relicensing of a hydroelectric project involves long and convoluted processes that can be very daunting. Those who carefully plan and organize a projected licensing effort in a comprehensive manner will face less difficulty. Managers of licensing projects and key decision makers participating on a hydro licensing team need to appreciate the various nuances and challenges they could face through the multi year process in order to adjust their approach as circumstances change through the process.

Each licensing project is unique and each prospective license applicant has a different management structure and company business philosophies. The planned licensing project needs to be adapted to work within these constraints. The size and complexity of the hydro project also can significantly affect the approach and level of effort needed to get the job done. The purpose of this paper is to discuss how to take these variables into consideration when tailoring a licensing organization that is best adapted to suit the situation. The author will draw from his experience to present a variety of large and small licensing project examples.

This report is intended to help Fish and Wildlife Service (FWS) staff become more effective participants in the hydropower relicensing process through a better understanding of the economic analysis used to evaluate hydropower projects. Specifically, the report seeks to accomplish the following goals:

• Explain the Federal Energy Regulatory Commission's (FERC's) current approach to the economic analysis of relicensing alternatives;
• Review potential methodological refinements and why they are important; and
• Introduce a variety of approaches for assessing non-power values, helping FWS staff recognize when more advanced analyses are applicable.

The purpose of this document is not to provide a step-by-step guide for the conduct of primary economic analysis, i.e., the reader is not expected to become an expert in the implementation of the analyses described here. Rather, the document seeks to attune non-experts to the role of economics in relicensing and the diversity of techniques available.

Hydro project owners share experiences and lessons learned from using the Federal Energy Regulatory Commission’s integrated licensing process, the ILP.

This paper investigates the sources for regulatory delay in bureaucratic decision making, testing regulatory capture, congressional dominance, and bureaucratic discretion theories of agency behavior.

The empirical context concerns relicenses issued by the Federal Energy Regulatory Commission (FERC) for hydroelectric dams, which have taken anywhere from just ten months to over sixteen years to be issued. The reasons for this heterogeneity in regulatory processing times can be expected to be varied and numerous and indeed we find evidence that outside interest groups, the legislature, and bureaucratic discretion are all significant in affecting regulatory processing times. Our most intriguing results concern the effects of environmental interest groups, which, despite their apparent benefit/cost motivation to hasten the relicensing process (independent of relicensing outcomes), overall end up slowing it down.

This paper takes a look at the FERC's "first-in-time" policy for granting preliminary permits to new hydropower projects concluding that FERC's policy contradicts Federal Power Act's directive to the Commission. The paper also argues that this policy also does not allow for competition for licensing.

FERC has made great strides recently soliciting public input on whether they can and should "consider decommissioning of a project as an alternative to issuing a new license." Also, FERC has asked for input on how cumulative impacts of hydro porjects in the same reiver basin should be addressed. In respone to this request, various NGOs have weighed in with their opinion. The Hydropower Reform Coalition states FERC needs a "cradle-to-grave" approach in licensing that would fund the retirement of a hydro facility at the end of its useful lfe without burdening taxpayers. Furthermore, rather than review dams one by one, FERC should conduct river basin wide analyses, issuing licenses according to that plan.

Negotiation implies that parties try to reach an agreement that will satisfy at least some of the needs of each of the participating groups. According to analysis performed by an interdisciplinary research team at the national Biological Service, parties negotiating about hydropower licenses need seven conditions and behaviors. They are: need to negotiate; representativeness; power; technical clarity; commitment to implementation; urgency; playing by the rules. The results of our investigations--determined by analyzing six recent hydropower project licensing consultations--are presented below as a general guide to successful negotiating.

Scientists at the Mid-Continent Ecological Science Center of the National Biological Service conducted a series of case studies of Federal Energy Regulatory Commission license consultations. The goal of these studies was to test hypotheses abbot factors that contribute to success in interagency negotiations. Based on their analysis of six case studies, the researchers constructed a list of ten "rules for success." Examples include: Analyze the incentives of each party to negotiate, paying special attention to parties who gain by not negotiating; Clarify the technical issues so that all agree and they coincide with resource management objectives; and make sure the final agreement is feasible form both a physical and a policy perspective so that it can actually be implemented. These rules can be used to plan for negotiations and to diagnose ongoing negotiations.