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Hydroelectric Hearing Highlights Costs of Federal Permitting Delays

The House Energy and Commerce Committee’s subcommittee on energy held a hearing on June 7th on energy infrastructure licensing reform. Although Improving the Hydropower Licensing Process focused only on hydroelectric projects, the issues it highlighted are relevant to the challenges facing many kinds of infrastructure projects and lend support to efforts to streamline the federal approval process.

The five federal agency witnesses at the hearing—FERC, EPA, Army Corps of Engineers, NOAA, and Fish and Wildlife Service—all have a hand in hydroelectric approvals and are indicative of the complexities in the process. Hydro ought to be the low-hanging fruit for federal energy approvals—a cheap, clean, and abundant source of baseload power that does not need government subsidies to grow. Nonetheless, even the relicensing of existing hydroelectric dams or approvals to electrify non-hydroelectric dams can and sometimes do drag on for a decade or more. This has a chilling effect on investment in hydro projects relative to wind and solar, which benefit both from less red tape and heavy subsidies.

The Trump administration’s Executive Order 13807 should, if properly implemented, go a long way towards addressing these concerns. It requires One Federal Decision (OFD) for major infrastructure projects, designates a lead agency (which for hydro would be FERC), and puts all participating agencies on a strict timetable to perform their statutory duties.This would limit the ability of a single agency to hold a project hostage, for example EPA under the 404(c) permit requirement for discharge of dredge or fill material.  

In addition to administrative remedies, the House has passed legislative reformsapplicable to the approval process for hydroelectric projects. Both administrative and legislative changes will be needed.

A streamlined and reasonable federal approval process applicable to private sector projects of all types could serve as President Trump’s stimulus package. And unlike the Obama stimulus package, it won’t cost taxpayers a dime and might actually work.