Interior and FERC Compromise on OCS Renewables Development
Last week, Secretary of the Interior Ken Salazar and then-Acting Chairman (now Chairman) of the Federal Energy Regulatory Commission (FERC) Jon Wellinghoff announced an agreement between the Department of the Interior (DOI) and FERC to work together to facilitate development of renewable energy projects in offshore waters on the Outer Continental Shelf (OCS).
The agreement signals the end of a long jurisdictional conflict between DOI and FERC regarding oversight of offshore renewable resource development, and has the potential to streamline the regulatory process for development of such resources. Under the Federal Power Act, FERC regulates hydropower projects in the navigable waters of the United States. The Energy Policy Act of 2005, however, amended the Outer Continental Shelf Lands Act to expand DOI’s OCS energy resource development power and give DOI parallel permitting authority for the production, transportation, or transmission of non-fossil energy resources on the OCS, including renewable projects. Since the change, DOI’s Minerals Management Service and FERC disagreed on which agency has primary jurisdiction over offshore hydropower projects, preventing progress in rulemaking and resulting in an absence of federal rules governing renewable energy project development on the OCS.
Under the agreement, Interior will cede primary responsibility to FERC to manage licensing of offshore hydropower projects (e.g., wave and ocean current) using procedures developed for hydropower projects under the Federal Power Act and with the involvement of federal land and resources agencies, including DOI. DOI will retain jurisdiction over wind projects. The joint announcement notes that DOI and FERC are preparing a Memorandum of Understanding that will outline the principles of the agreement and the new permitting and licensing process for offshore renewable energy projects.
While Salazar and Wellinghoff, along with various renewable energy groups, praised the agreement for its promise to provide greater regulatory certainty for offshore energy developers and speed project development, others are skeptical that the agreement will be effective. For example, Senate Energy and Natural Resources Committee Chairman Jeff Bingaman has expressed doubt that the agreement will actually streamline the development process and Bingaman and Ranking Member Senator Lisa Murkowski both have suggested that a more definite legislative solution might be included in a forthcoming energy bill.