FERC, MMS Settle Outer Continental Shelf Turf War

A memorandum of understanding last week signed by Secretary of the Interior Ken Salazar and Federal Energy Regulatory Commission (FERC) Chair Jon Wellinghoff clarifies jurisdictional responsibilities and establishes a process through which the two federal agencies will lease, license, and regulate all renewable energy development activities on the Outer Continental Shelf.

The agreement formally ends a longstanding turf war between the two agencies. For years, both had claimed jurisdiction over the Outer Continental Shelf, forcing potential developers to work through each agency’s lengthy and pricey regulatory processes.
“By removing all the regulatory barriers to the development of hydrokinetic energy in the Outer Continental Shelf, this agreement will advance the development of a promising renewable resource that in the end will benefit consumers,” said Wellinghoff.

Per the agreement (PDF), the Interior Department’s Minerals Management Service (MMS) has exclusive jurisdiction with regard to the production, transportation, or transmission of energy from non-hydrokinetic renewable energy projects, including wind and solar. The MMS also has exclusive jurisdiction to issue leases, easements, and rights-of-way regarding Outer Continental Shelf lands for hydrokinetic projects. It will also conduct any necessary environmental reviews, including those under the National Environmental Policy Act, related to those actions.

FERC has exclusive jurisdiction to issue licenses and exemptions from licensing for the construction and operation of hydrokinetic projects on the Outer Continental Shelf. It will conduct any necessary analyses, including those under the National Environmental Policy Act, related to those actions. FERC’s licensing process will actively involve relevant federal land and resource agencies, including the Interior.

According to the agreement, FERC will not issue a license or exemption for an Outer Continental Shelf hydrokinetic project until the applicant has first obtained a lease, easement, or right-of-way from the MMS for the site. Also, FERC will not issue preliminary permits for hydrokinetic projects on the Outer Continental Shelf. In all leases, easements, and rights-of-way for hydrokinetic projects, the MMS will require that construction and operation cannot begin without a license or exemption from FERC, except when FERC notifies the MMS that a license or exemption is not required.

FERC and the MMS said they would coordinate to ensure that hydrokinetic projects meet the public interest, including the adequate protection, mitigation, and enhancement of fish, wildlife, and marine resources and other beneficial public uses. Both agencies may inspect authorized hydrokinetic projects on the Outer Continental Shelf to ensure compliance with the terms of leases, easements, rights-of-way, licenses, or exemptions.

At its discretion, FERC may choose to become a cooperating agency with the MMS in the latter’s preparation of an environmental document for the lease, easement, and right of way for any Outer Continental Shelf hydrokinetic project. Likewise, the MMS may choose to be a cooperating agency with FERC in the preparation of FERC’s environmental documents for the license or exemption of any Outer Continental Shelf hydrokinetic project.

Sources: FERC, MMS