A. Standard Articles

All licenses issued since 1953 and many issued previously, include Standard Articles, which are incorporated by reference.  While these vary slightly between license categories (for example, existing versus unconstructed status or minor versus major generation capacity), they establish general duties for the protection of the public interest, including coordination of water regulation in a river basin.  One of these Standard Articles reserves FERC’s authority to require additional or different environmental conditions in advance of relicensing, either on the motion of a regulatory agency or other person or its own initiative.  This article balances the licensee’s need for investment security over the license term, with the countervailing need to adjust project design or operation if circumstances relevant to the public interest change significantly after license issuance.[1]  Thus, Standard Article 15 for a major project (over 5 MW) provides:

“The licensee shall, for the conservation and development of fish and wildlife resources, construct, maintain, and operate, or arrange for the construction, maintenance, and operation of such reasonable facilities, and comply with such reasonable modifications of the project structures and operation, as may be ordered by the Commission upon its own motion or upon the recommendation of the Secretary of the Interior or the fish and wildlife agency or agencies of the State in which the project or a part thereof is located, after notice and opportunity for hearing.”[2]

Other Standard Articles permit reopening a license (a reopener) for modification of recreational facilities, coordination of energy operations in a watershed, and other purposes.[3]  Mandatory conditions submitted under FPA section 4(e) or 18 or CWA section 401(a) may include reopener at the initiative of the prescribing agency.[4]

FERC rarely reopens a license under the reservation of authority contained in a Standard Article or the numbered articles that require specific measures for protection, mitigation, and enhancement of environmental quality.  It probably denies 90% or more of the motions for reopener filed by agencies or other participants.  Its view is that a license must provide financial and legal security to the licensee in order to assure recovery of the costs of construction, operation, and maintenance and that the environmental measures required by numbered articles should not be changed unless the law or circumstances that existed when the license issued have materially changed.

The HRC differs as to what constitutes a material change in circumstances.  You have greater leverage to reopen the license if it contains specific benchmarks regarding the circumstances that are the basis for the environmental measures.  We recommend that you seek specific findings in a license to describe the expected impacts of such measures.  “E.g., if this flow schedule is adopted, then the project discharge will also have a dissolved oxygen context of X ppm or more.”  That way, if the expected impacts are not achieved, FERC will have a rational basis for reopening the license.

The ESA is a primary driver for reopening a license mid-term.  FERC may be compelled to reopen a license by initiating formal consultation with FWS/NMFS, if one of those agencies finds that continued operation may adversely affect a species listed after license issuance and petitions for such reopener.[5]

Another primary driver for reopener is a change to water quality standards or new monitoring data that demonstrate that the project does not comply with existing standards.  If the certification includes a reopener provision, the administering State agency may reopen the certification (and thus, by necessary effect, the license) to achieve such compliance.


[1]               See 18 C.F.R. § 2.9 (incorporating “Standardized Conditions for Inclusion in Preliminary Permits and Licenses Issued Pursuant under Part I of the Federal Power Act,” 54 FPC ¶ 1792 (1975).  These Standard Articles, collected in forms by type of license, are available at https://www.ferc.gov/industries/hydropower/gen-info/comp-admin/l-forms.asp.

[2]               Id., Form L-5.

[3]               See id. at L-03, Articles 10, 13, 17, and 18.  FERC has also developed a policy statement to make explicit its preference to evaluate project impacts cumulatively, where practical, and if necessary, through reopener.  See “Use of Reserved Authority in Hydropower Licenses to Ameliorate Cumulative Impacts:  Policy Statement,” FERC Stats. & Regs. Preambles ¶ 31,010 (Dec. 14, 1994), 59 Fed. Reg. 66,718 (Dec. 28, 1994).

[4]               See American Rivers v. FERC, 129 F.3d 99 (2nd Cir. 1997) (American Rivers I); American Rivers v. FERC, 187 F.3d 1007 (9th Cir. 1999), as amended 201 F.3d 1186 (9th Cir. 2000) (American Rivers II).

[5]               See In re American Rivers and Idaho Rivers United, 372 F.3d 413 (D.C. Cir. 2004).