Permitting Insanity

Why does it take more than 9 years and endless anguish to allow wind turbines in Nantucket Sound, but deepwater oil drilling routinely has environmental impact studies waived, supposedly because massive oil spills are unlikely? The oil industry has received approvals with potentially severe environmental impacts in as little as 10 minutes. Contrast the (over-)abundance of caution for wind and the cozy practice of superficial scrutiny for oil. Recent events make the dissonance especially jarring.

The Cape Wind offshore wind farm is closer than ever to the start of construction. Just more than a week after the explosion of BP's Deepwater Horizon platform, US Interior Secretary Ken Salazar gave formal approval, saying:

After careful consideration of all the concerns expressed during the lengthy review and consultation process and thorough analyses of the many factors involved, I find that the public benefits weigh in favor of approving the Cape Wind project at the Horseshoe Shoal location. With this decision we are beginning a new direction in our Nation’s energy future, ushering in America’s first offshore wind energy facility and opening a new chapter in the history of this region.

FERC Preliminary Permits

We got a lot of comments on the applications Grays Harbor Ocean Energy Company submitted to the Federal Energy Regulatory Commission (FERC) for preliminary permits. Many were submitted to the FERC on their website; others were posted to various community sites or other blogs. Many of these comments objected to the harm the commenters anticipated would occur from the building and operation of marine energy projects as described in the permit applications.

Most of these objecting comments reveal a lack of understanding of the FERC hydrokinetic process and especially the purpose and scope of a preliminary permit. The FERC outlines the process and notes a key facet of a preliminary permit:

These permits do not authorize construction. Rather, they give the developer priority to study a project at the specified site for the duration of the permit.

The preliminary permit is different from the license required to actually build and operate a project. A developer first obtains a preliminary permit to study a site; the permit is generally good for 36 months and requires reports to the FERC twice a year. A permit holder may subsequently apply for a pilot license, good for five years, which allows the construction and testing of a single demonstration unit to further assess project impacts and feasibility. A full license requires extensive studies, coordination with other permitting agencies, and intensive stakeholder engagement throughout the process.

The FERC has expanded on what comments are relevant to a preliminary permit application when ordering their issuance. For example [pdf]:

The majority of the comments filed addressed the construction of the project, including the cable to shore, and potential impacts the project might have on fish and wildlife, aesthetics, and navigation. As noted, a preliminary permit does not authorize a permittee to undertake any construction. Furthermore, the purpose of a preliminary permit is to study the feasibility of the project, including studying potential impacts. The issues raised in the comments are premature at the permit stage, but can properly be addressed in the licensing process.

The FERC also addressed in its Order of Rehearing on the Humboldt and Mendocino preliminary permits [pdf] how it generally does not consider environmental impacts in its decision to issue a preliminary permit:

By its terms, a preliminary permit gives the permit holder no land-disturbing or other property rights, nor does it authorize the placement of any test devices. This being the case, we generally do not consider environmental issues in issuing permits.

The FERC adds that because they result in "no environmental impacts" preliminary permits are only denied for a limited number of reasons:

Because the issuance of a permit can have no environmental impacts, there are few reasons for the Commission to deny a permit application. The Commission will deny a permit where it selects one competing permit application over another. As a matter of policy, the Commission has decided not to issue permits where there is a legal bar to issuing a license for the proposed project. We have also denied permits where we had completed an environmental analysis in a previous proceeding and decided that environmental considerations had made the site in question appropriate for hydropower development, and where a permit applicant was unfit to be a licensee.

Thus comments on potential threats to wildlife, views, quietude and the rest, while raising matters of legitimate concern, do so prematurely, as the preliminary permit is specifically designed to formally evaluate and investigate those concerns. That's what it is for.

Grays Harbor Ocean Energy Company

The Grays Harbor Ocean Energy Company (GHOEC) has filed applications for preliminary Federal Energy Regulatory Commission (FERC) permits for hydrokinetic power at seven sites in six US states.

These filings are starting to get more visibility and comment and several people have asked us for more information on what we are doing, what our plans are, and why we are taking this approach. We have also upset a few people, primarily over two things: for not having engaged in more advance consultation, and for (some fear) having some kind of nefarious agenda.

In this post I will strive to provide some explanatory background along with more information about our plans and intentions. Your comments and constructive criticisms are welcome; please comment on this post or send email to info@graysharboroceanenergy.com.

Background

My business partner Burt Hamner and I founded GHOEC a year ago initially to pursue utility-scale ocean energy near Grays Harbor County in Washington State. Burt earlier had directed a feasibility study (12MB PDF) for Tacoma Power in Puget Sound's Tacoma Narrows to assess the viability and feasibility of tidal power. The study's conclusion is that tidal power in Tacoma Narrows would not be feasible for a decade or longer, and Tacoma Power sensibly declined to proceed further.

Although the study's result was disappointing--we had hoped to proceed with a demonstration project there--the need for renewable energy persists, so we looked at where to go next, and, as a result formed two companies, Hydrovolts and GHOEC. Hydrovolts seeks to take the concept of utility scale tidal turbines and build them much smaller--at kilowatt scale--for distributed and point-of-use generation. GHOEC sought to find solutions other than tidal power for large-scale renewable energy generation in Washington State.

During the assessment for Tacoma Power it became clear that the outer coast of Washington State has very strong wave and wind resources, and few were exploring them. Natural Currents LLC received a preliminary permit for tidal energy in Willapa Bay in March 2007 (P-12729) and Finavera Rewnewables continues to pursue wave energy in Makah Bay, having received the nation's first (and so far only) commercial operating license from FERC. (FERC permits and comments can be found here.) GHOEC filed an application for a preliminary FERC permit on 10/28/07 to assess the ocean energy potential near Grays Harbor; given the potential of the resource, we were surprised that no one else had previously done this.

Interestingly, AquaEnergy (later bought by Finavera) earlier looked at offshore energy in Grays Harbor, but discontinued their efforts because the ocean was too deep for their particular wave device. This may be the origin of the idea that the Washington coast is too deep for ocean energy devices in general; as we talked to various renewable energy people and companies we kept hearing that the ocean of Washington State was "too deep." However, the ocean current on the Pacific Coast moves south-to-north, and the Columbia River discharges at least a million tons of sediment into that current every year. So, while the outer continental shelf (OCS) is very narrow off California and much of Oregon, it gets quite large from near the mouth of the Columbia and to the north. 10 miles from shore the ocean is only about 150 feet deep, meaning that there is a very large area suitable for many kinds of marine renewable energy devices, and offshore wind turbines of the largest size could be placed far enough out to perhaps entirely mitigate concerns about views and noise.

The FERC Role

The FERC issued our preliminary permit P-13058 on 7/30/08. (Press Release.) This preliminary permit gives us the right to assess the potential for wave power at the two sites detailed in the application and described in detail on our web site. It does not permit the placement of anything in the water; that can only occur under a FERC pilot or operating license, and only after acquiring many other permits from the various local, state and federal authorities. What the FERC permit and FERC process do, however, is provide a detailed framework for proceeding. It removes ambiguity on what is required and ensures formal involvement of all stakeholders, including environmentalists, fishers and crabbers, local officials, tribes, property owners, and others. The FERC system also grants the first applicant for a hydropower site priority development rights. Says the FERC:

Section 4(f) of the Federal Power Act authorizes the Federal Energy Regulatory Commission to issue preliminary permits for the purpose of enabling prospective applicants for a hydropower license [covers wave power but not wind power] to secure the data and perform the acts required by FPA section 9.3 which in turn sets forth the material that must accompany an application for license. The purpose of a preliminary permit is to preserve the right of the permit holder to have the first priority in applying for a license for the project that is being studied. Because a permit is issued only to allow the permit holder to investigate the feasibility of a project while the permittee conducts investigations and secures necessary data to determine the feasibility of the proposed project and to prepare a license application, it grants no land-disturbing or other property rights.

We are very interested in offshore wind, and the wind off Washington State is amongst the best in the world for generating wind energy. Wind is not much mentioned in any of our FERC permit applications for a very simple reason: FERC has no jurisdiction over offshore wind on the OCS or anywhere else. In our application for the Grays Harbor demonstration project we had originally included information on our plans to test wind energy using a single turbine; the FERC sent the application back and requested we remove all references to this. The FERC didn't even want to hear about it. In our newest applications there is also only passing mention of wind energy, and this is based on our experience in filing applications with FERC according to their rules and requirements.

The Minerals Management Service Role

Historically, Minerals Management Service (MMS) of the Department of the Interior has overseen the leasing of federal lands (and waters) for resource extraction. It grants leases through a competitive auction for everything from oil and gas drilling to metals and mineral mining. The Energy Policy Act of 2005 (PDF) also gave the MMS jurisdiction over renewable energy projects on the OCS. The MMS and the FERC have been negotiating how to cooperate on offshore renewable energy projects ever since. They had publicly announced their intention to sign a MOU, but there is still no completed agreement. MMS completed the comment period on their proposed rules in September and has indicated that they will release final rules before the end of the year (now only weeks away.)

I posted earlier about FERC asserting jurisdiction over hydrokinetic projects on the OCS and the state of affairs between the two agencies. There are excellent summaries of the inter-agency squabble here and here. Final resolution by mutual agreement may yet happen, but intervention by Congress or adjudication by courts is looking more and more likely.

The GHOEC Approach

We believe our energy future requires offshore renewable generation from wind and wave. The best places to do these kinds of energy projects is farther out, beyond the limit of state waters--10-15 miles from shore.

The GHOEC technology solution for ocean renewable energy includes a mobile jackup platform that supports wave energy and wind turbines. The MMS does not yet have a process or rules to pursue energy projects on the OCS. When FERC asserted jurisdiction on hydropower projects on the OCS they provided a way to proceed. The Company therefore applied for FERC preliminary permits to assess wave energy from the sites identified. If the FERC issues preliminary permits the Company will proceed with site studies. The results of the studies, local consultations, partnering discussions and other factors will guide GHOEC in its decision of whether or not to proceed with the next phase of FERC permitting. We expect that resolution will be achieved on the issues between the FERC and the MMS and expect to pursue whatever applicable rules and procedures established by MMS, just as we will comply with those of all other authorities at every governmental level.

We are not hiding our interest in pursuing offshore wind or engaged in some kind of devious Trojan horse activity. Formal applications and responses to FERC are done according to their rules; we strive to present the full and accurate picture of what we are doing and planning on our web site. We also encourage interested or concerned parties to submit comments to FERC or directly to us. Commenting on the FERC applications is easy--when you have the docket number of the application go to FERC Online and follow the directions.

Finally, all of this is still at a very preliminary stage and many things could change as we go forward. We have not selected any particular wave or wind technology and recognize that considerable work lies ahead in figuring which, if any, would be suitable. Those alluded to in the applications or on our web site are provisional; any proposed solution will require careful and competent study in many areas, including suitability for any particular site.

We do like the three-legged jackup platform, adapted by Offshore Wind Power Systems of Texas from use in the Gulf of Mexico oil and gas industry. There are many advantages to this platform, including:

• There are no cables/wires underwater which threaten whales
• It has a smaller ocean floor footprint than cable systems
• It can be placed/removed in as little as a single day
• There is no driving of piles and thus none of the noise that pile-driving causes
• The structures are simple enough that they can be manufactured locally using facilities that exist in any marine industry in any reasonably-sized port.
• The core design withstands force 5 hurricanes and 60-foot swells

There are, of course, also many questions, which is why more studies need to happen before this or anything else is put in the water. Our approach is to proceed deliberately, following the rules, and doing the work of careful assessment and study using qualified experts and the insight and knowledge of local groups. If at any point it becomes clear that any project under consideration cannot be made viable, feasible, and environmentally compatible we will stop. Bookmark the page, print it out, memorialize this how you want. It is a commitment on our part.

Consultation

The first that many local authorities and stakeholders learned of our plans was by a notice from a federal agency or a piece in the news. That is not what we wanted, and we are sincerely sorry for the shock and for any offense.

Just as with our removal of most mentions of wind turbines in our applications to the FERC, so to with our consultations: we acted based on our experience with the application for the project in Grays Harbor. Burt wrote an open letter explaining how we were surprised by the pace of the process:

I wish to extend my apologies for surprising state and local officials and organizations in the states where we have proposed projects. The FERC acted on our applications faster than I think it has ever acted for any applicant before, and, frankly, it caught it us off guard. We have not had time to contact the political, energy and ocean leaders in our project areas.

We applied for the preliminary FERC permit for the Grays Harbor project on October 28, 2007. The FERC opened the application for public comment five months later, and issued the permit on July 30, 2007, nine months after we applied. The seven recent permit applications were applied for on October 21, 2008 and the FERC opened them for public comment on November 28, 2008, a mere five weeks later. We simply did not expect (and did not have advance notice) that seven applications would all be opened for comment so quickly. Naively, we assumed that we could begin that process in January rather than during the holiday season, and be fully engaged prior to the FERC's action. We were clearly wrong to assume this and regret the negative impression of our intentions it has created. Burt wrote:

We have been preparing to contact the officials in the states affected by our applications in January and February, after the holidays and the Presidential transition and the new Federal agency heads are in place. I personally called FERC and asked them to open the public comment period in January or February, because opening it in December is rather unfair to the public - the holiday season is a big distraction and I don't think the public and agencies really get a "normal" 60-day comment period if it opens on November 28. A proposal for offshore energy development of course greatly concerns state and local officials and the affected public and interest groups. We have great experience in stakeholder consultation and the permitting processes and we like the FERC system, unlike almost every other developer, because it requires and directs an extensive consultation process with every stakeholder. We will follow that process and contact state and local leadership in our site areas beginning in January 2008. We have already contacted a few key people in each state. We look forward to receiving "official" comments on our applications to FERC during the 60-day period, and of course we want any feedback at any time to help us understand local concerns and learn how we can advance this tremendous opportunity in open partnership and collaboration.

Again, we welcome your comments, either directly to us or to FERC (use the docket number of the application and go to FERC Online.)

Charging Ahead on Electric Vehicles in California

The three largest Bay Area cities in California have agreed to foster the infrastructure for electric vehicles.

Better Place (formerly Project Better Place) has scored a coup in the California Bay Area. The electric vehicle startup has struck a deal with the region, including the cities of San Francisco, San Jose and Oakland, to set up a $1 billion charging network for electric cars, with car availability beginning in 2012.

The cities will proide a lot of incentives and will "streamline," "expedite" and "harmonize" regulations, permitting, etc. The actual source of $1B is less clear; it sounds like mostly in-kind support and encouragement rather than cash, but that kind of support is still fantastic.

Election Offers Distinct Options

Worldwatch observes the importance of Tuesday's election on the future of green jobs, and notes that there are "distinct options":

With less than a week until the United States elects its next president, and at
a time when Americans are losing their jobs in record numbers, the two leading
candidates are suggesting that the financial crisis can be resolved by addressing the country's worsening energy crisis.

Combining job creation and energy policy into one economic stimulus plan is gaining steam among political and environmental leaders worldwide. Yet despite similar rationales, the plans presented by the Democratic and Republican candidates offer distinct options. And not all of the proposed jobs would truly be "green."

I've posted several items on the Green New Deal, and some of the other ballot measures in different states. As is typical of the election season the candidates are never wholly specific about what they will do, but despite the uncertainties of what is promised and what might be delivered, there are plenty of substantive elements voters should consider. While down-ballot races and initiatives certainly matter, the largest impact will come from who we elect as President for the next four years.

John McCain's energy plans heavily emphasize oil and nuclear, adding only a perfunctory nod to other approaches in a so-called "all of the above" policy. Oil is not the way forward. With 3% of the world's reserves and 25% of the world's consumption the United States cannot drill its way to energy security, even if all the oil could be feasibly extracted. Recent reports suggest peak oil may be much closer than previously thought--as soon as 5 years away. Nuclear power has gained adherents and public support; even some environmentalists such as Stewart Brand have softened their opposition in the face of climate change fears. However, nuclear has very long lead times, arduous permitting, unsolved waste disposal problems ("blah blah blah"), and uneconomical costs. Even if McCain succeeds in spurring the construction of 45 new nukes by 2030, it won't come close to solving our problems. Nuclear is not the way forward either. McCain offers nothing new.

Barack Obama's energy plans (PDF) emphasize updating the electrical grid, creating a national Renewable Portfolio Standard (RPS), and investing $150B over 10 years in renewable energy development. Updating the grid is a critical infrastructure need and will allow better integration of variable renewable sources such as wind, as well as allow significantly greater energy efficiency at all levels. The cost for this is potentially astronomical (or should I say economical?) A national RPS is a good idea, and would prevent the kind of sophistry proposed by Washington State gubernatorial candidate Dino Rossi to redefine the term "renewable" in a way that would vitiate any new renewable energy development under the state RPS. There are several problems that will be difficult to resolve, especially deciding what qualifies as renewable, and making it appropriate for windy states like North Dakota, states with big solar resources like Arizona, states with large hydrokinetic resources like Washington, and states with few renewable resources like those in the southeast. Obama's $150B is a good step, but more is needed, the neo-Hooverite objections must be met, and there are questions about how it would square with free trade agreements under the WTO. There are questions about Obama's proposals, yes, but they aren't nearly as fatal as those posed by McCain's proposals, and it is easier to see how answers might be found.

In summary, Obama offers an approach where America can lead in the global energy economy of the future, while McCain offers an almost nostalgic reprise of the policies that got us here. I don't like where we are, and the last thing we need is more foot-dragging in the face of a future that makes the old ways of thinking not only obsolete but dangerous to our economic and environmental health. Whether Obama can deliver, and whether it will make enough difference are questions not yet answerable, but what McCain offers, even if delivered in full, will not suffice.

I will vote for Obama. For the future of our environment, our energy needs and our economic well-being, I urge you to do the same.

Finavera and PG&E denied wave permit

PG&E had worked out a deal with Finavera Renewables for a wave project off Humboldt County in a PPA that would have paid an astonishing 23 cents per kWh. But the California Public Utilities Commission rejected it:

The commission determined that the project isn't viable, that Finavera's bid doesn't compare to others in PG&E's renewable energy portfolio and that the contract price for the power isn't reasonable.

Putting a brave face on it, PG&E says it is still committed to wave energy and will go forward with other projects: "We believe the rejection of this contract won't hinder further wave development." UPDATE: Finavera's trying to be brave too.

The lack of viability was based in part on the fact that Finavera's wave devices are “precommercial” and that an earlier buoy sunk off of Reedsport, Oregon. Approving the proposed project right now “is not the best way to move this wave technology towards commercialization.”

Reality check for state regulators. If this is a good reason to turn down such a project, how will any project get permits? Shouldn't regulators be encouraging development rather than insisting that all technology be somehow perfected before being placed in the water? Athena may have sprung fully armed from the head of Zeus, but technology isn't birthed fully ready for commercial battle. How do they expect that technology will become ready without getting wet?