FERC denies small conduit designation for project on New York canal system

The Federal Energy Regulatory Commission has rejected a request to declare a proposed project on the New York State Barge Canal System to be a small conduit hydro project excluded from FERC jurisdiction.

The Hydropower Regulatory Efficiency Act, passed last year, removes entirely from FERC jurisdiction those new “qualifying conduit hydropower facilities” under 5 MW that are on water conduits. Prior to HREA, FERC could issue “conduit exemptions” from hydropower licensing to hydroelectric facilities under 15 MW (for non-municipalities) and 40 MW (for municipalities) using a man-made conduit operated primarily for non-hydroelectric purposes. While exempt from more stringent FERC hydro licensing, exempted projects are still subject to lesser FERC regulation.

FERC determined that projects seeking complete exclusion from FERC jurisdiction under HREA as “qualifying conduit hydropower facilities” must use a tunnel, canal, pipeline, aqueduct, flume, ditch, or similar manmade water conveyance that is operated for the distribution of water for agricultural, municipal, or industrial consumption and not primarily for the generation of electricity. Further, the power project must not exceed 5 MW and must use only the hydroelectric potential of a non-federally owned conduit.

FERC rejected a request by ECOsponsible Inc. to declare its proposed 3-MW Caughdenoy Lock hydro project (No. CD14-15) to be a “qualifying conduit hydropower facility.” The project is proposed to include three arrays of hydrokinetic cross-flow turbines on the bottom of the canal at Caughdenoy Dam on the Oneida Lake Steamboat Canal on the Oneida River near Clay, N.Y. Historically, the canal and lock were used for navigation but now help regulate lake levels and provide flood control.

In rejecting the qualifying conduit designation, FERC noted April 17 that HREA requires that qualifying conduits must be operated for distribution of water for agricultural, municipal or industrial consumption, and not for navigation or flood control. The commission rejected an additional argument by ECOsponsible that a downstream marina and campground and a wastewater treatment plant use water from the canal system.

“Even assuming that water that passes through the lock ultimately is used at either facility, nothing in the record shows that this is anything but incidental, rather than being a purpose for which the lock and canal are operated,” FERC said.

In February, FERC rejected a rehearing request by KC Brighton LLC, licensee of the 400-kW Brighton hydroelectric project (No. 3633), saying Brighton could not escape FERC jurisdiction as a small conduit project because it uses an 80-foot-tall, 995-foot-long dam, rather than a conduit.

FERC has created a web page under Hydropower Regulatory Efficiency Act of 2013, http://www.ferc.gov/industries/hydropower/indus-act/efficiency-act.asp, providing guidance to developers on filing a notice of intent to build a qualifying conduit facility, an application for small hydropower exemption, and an application to amend preliminary permit terms.

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