In prepared testimony submitted to the House Energy and Air Quality Subcommittee in advance of hearings, John Prescott, an nha board member and vice president of generation for Idaho Power Company said: “America is in danger of losing significant hydro power capacity and operational flexibility at a a time when it is most needed. As we face rising energy prices, energy shortages and reliability and pollution concerns, now is the time for policy makers at the federal level to better incorporate hydro power into the nation’s long-term energy strategy.”
Prescott said that costs, delays and conflicting mandates inherent in the process threatened generation capacity.
He pointed out a fundamental conflict contained within the Federal Power Act that disperses decision-making across the licensing scheme.
On one hand, the Federal Energy Regulatory Commission (FERC) that grants hydro licences is required to give equal consideration to both the power and non-power values of a project.
On the other hand, FERC cannot properly weigh conditions to a licence set by natural resource agencies. When dealing with fish passage issues or the management of federal lands, resource agency conditions are mandatory, subverting FERC’s ability to balance all factors.
“FERC has no opportunity to balance a license in the broadest public interest,” Prescott added. “The net result is that no one has the authority to look at the big picture.”
Prescott has applauded bipartisan efforts to create incentives for new capacity or efficiency upgrades at existing hydro facilities. Costs of new generation range from US$650 to $2000, higher than fossil generation. He says that licensing reform combined with an incentives package would, “benefit hydro producers, the environment and consumers and is a goal that all Americans should support.”
Over the next 15 years, 240 projects in 38 states, nearly 29,000MW of power, must undergo the FERC licensing process. Idaho Power Company, with 17 hydro plant that comprise 60% of its generating portfolio, faces the relicensing of 1,485MW before 2010, including the 1,167MW Hells Canyon complex.
