The Minerals Management Service (MMS) has chosen Fort Bragg and Eureka as priority sites over Oregon and Washington for its new wave energy study process. The MMS is asking for public input on its plan to lease blocks of the outer continental shelf for study of wave, wind and current energy. Locally, this novel process is separate and could conflict with the preliminary permits now issued to the Pacific Gas &Electric Company by FERC, an independent federal agency.
In March, PG&E was granted exclusive three-year study rights to waters off Fort Bragg and Eureka by FERC.
MMS, which is part of the U.S Department of Interior, released a plan last Friday to test wind energy on select sites on the Atlantic seaboard, ocean current energy off Florida and wave energy off Eureka and Fort Bragg. It released a map of blocks of the ocean that it plans to lease exclusively for five years after a competitive process.
Like FERC, the MMS study lease allows legal deployment of test devices, but not for generation of electricity. MMS further demands that applicants meet the same requirements as those for its oil and gas leases. The entire process is based on the oil and gas leasing process that MMS uses for offshore drilling.
Each block of the ocean shown in the proposal is nine square miles in size. MMS hopes for competition between developers for each block or group of blocks. Its notice in the Congressional Register says it will seek competing applicants if they don”t appear before the May 19 deadline.
Off Fort Bragg, 14 nine-square-mile blocks have been identified for lease sale. Off Eureka, there are 24 blocks identified.
MMS got wave energy nominations in Oregon, Washington and California, but chose only the two California sites as initial tests. East Coast newspapers reported that some projects who filed nominations but didn”t make MMS”s priority lists were disappointed. The local projects were chosen from among more than 40 nominations because of a need to test wave energy somewhere, MMS says.
But why was California chosen over Oregon and Washington, where wave energy is more developed?
“The MMS reviewed in detail all nominations and established our priority areas for initial leasing in light of considerations such as technological complexity, timing needs, competing use issues, and relationships to relevant state-supported renewable energy activities, as well as considerations relating to limited available MMS staff and budget resources for processing and managing limited leases. We also took into consideration the desirability of authorizing the advancement of activities relating to each of the alternative energy resource types cited in the nominations — wind, current, and wave,” MMS”s Congressional Record filing states.
PG&E”s applications with FERC and the California Public Utilities Commission were cited by MMS as part of their explanation as to why the Mendocino and Humboldt coasts were given priority over all other areas. Energy developers say PG&E”s willingness to test rival technologies in one site make it especially important nationally to the emerging hydrokinetic technology.
MMS says it also sought simplicity in its choices.
“Many of the nominations that were not selected for priority processing appear to entail complex technology (e.g., new deeper-water designs) or environmental or conflicting use concerns that would make processing them more difficult and time consuming,” the Congressional Record filing states.
The federal MMS feud with FERC means jurisdiction overlaps in many areas, including locally. MMS claims control of the ocean beyond the three mile limit, while FERC has asserted control over all ocean energy production. PG&E”s local permit extends beyond the three-mile limit of state waters. MMS is now preparing to lease through auction a five-year study lease, which includes the portion of the permit that extends beyond the state”s territorial limit. In Florida, FERC has issued a preliminary permit for study for 1,050 square miles of open ocean for testing of current power devices.
The MMS competitive approach contrasts with FERC”s stated process of awarding preliminary permits — and ultimately license to extensively develop the ocean to the first company in line, although challenges are made to root out speculators.
The conflict is essentially between a 20th century process in which set government processes are followed and FERC”s 21st century concept of cutting red tape and letting industry self-regulate and create the process. Yet, it remains to be seen if any companies beyond PG&E will compete for the waters off Fort Bragg, as MMS hopes.
“We have identified these areas as our priorities for potentially authorizing limited leases under this interim policy, and through this notice we are soliciting comments to determine if competitive interest exists in these areas,” MMS wrote in the Register.
The MMS notice is an indication it may be ready to turn jurisdiction over to FERC in areas where no competing applications exist.
“Where our analysis concludes there is no competitive interest in a previously nominated area, we will?proceed with a noncompetitive lease?. However, we may first choose to explore options for collaboration in the interest of optimizing efficiency,” the MMS filing states.
On Jan. 4, PG&E applied to MMS, in an effort to work with both the feuding federal agencies in a still evolving process.
PG&E has not disclosed the details of its MMS nomination to anyone so far. No other applicants have emerged locally. The Advocate News made a formal request from PG&E on Monday, April 21. The newspaper also filed a Freedom of Information Act Request with MMS on Monday. The status of those requests will be reported on in future issues.
The general public has 60 days from Friday”s Congressional Record filing to provide comments on the process and the selection of the proposed lease areas, while potentially involved parties, such as governments, have 30 days to comment.
Beth Mitchell, a retired Interior Department attorney living in Fort Bragg, who has been involved with the local group FISH (Fishermen Interested in Safe Hydrokinetics) says without details of the nominations, providing comments is difficult.
The MMS filing states the agency is looking for input mostly on how wave energy development will fit in with other laws and other energy projects.
“We seek information?relating to other ocean and seabed uses, relationships to onshore energy markets of the nominated areas, and applicable state and local laws and policies. We also request comments and suggestions on how we may best coordinate and consult comprehensively and efficiently to comply with applicable federal, state, and local laws and policies. Officials of MMS intend to contact federal, state, and local government counterparts during the comment period to discuss the nominations and the process for issuing limited OCS alternative energy leases under the interim policy. Such discussions may explore methods to foster intergovernmental coordination, including whether to establish intergovernmental task forces with federal, state, and local entities for this purpose,” the filing states.
The process of getting alternative energy production from idea phase into testing and production has been marked by conflicts and confusion among an alphabet soup of federal agencies, each with some claim on a process Congress and the President haven”t seen fit to define.
Nowhere is the conflict more acute than between MMS and FERC.
When members of Congress tried to get the two federal agencies to sign an agreement to work together, MMS refused, saying the agreement would be inappropriate until the process was defined.
Philip Moeller, one of five FERC commissioners appointed by President George W. Bush, said FERC was willing to sign the agreement with MMS.
FERC has come under intense criticism for acting without consideration or deliberation. That criticism has come from environmental agencies at the state and federal level, and by local governments, which say FERC has excluded them from the process.
FERC”s hydrokinetic process is in full swing, granting more than 100 exclusive permits across the nation for water motion studies for rivers, tides, ocean currents and ocean waves. Last week, FERC released rules for two new kinds of test licenses.
MMS is in the midst of “rulemaking” an extensive process for filings covering public input, interaction with other laws and appeals.
“In January, 2008 the Assistant Secretary for Land and Minerals Management, to prevent potentially stalling the momentum, requested that the director of MMS defer action on a cooperative agreement with FERC until after MMS has published its proposed regulations for public review and comment. The proposed regulatory framework will better inform both agencies if there is still a need to enter into a cooperative agreement with FERC,” a MMS spokeswoman told the Advocate News by e-mail.
The Congressional Record filing reveals several more differences between the MMS approach and that of FERC.
While FERC has snubbed local government and not had any process with state government, MMS says plans to do both, giving both more regulation and assistance to the applicant.
FERC grants real property rights with its preliminary permit in the form of the exclusive use to the waters that legally resembles a mining claim. Further property rights include FERC”s granting of priority status for licensing. FERC promises its preliminary permit applicants first crack at licenses. The new licenses FERC has proposed are much shorter than its traditional ones, which last up to 50 years.
The MMS filing reveals that developers have pressured the agency to give priority licensing property rights to the corporation that undertakes studies.
MMS isn”t willing to grant developers that property right of priority, although its five year competitive leasing does, like FERC”s preliminary permit, grant exclusive rights to the winning developer.
“The interim policy is intended to permit the collection of resource assessment and technology testing data in support of future development activity without any priority right for future commercial development. It is designed to begin the process in the acquisition of needed information about a variety of OCS conditions under a relatively simple authorizing process. Conveyance of full commercial development rights would entail a much lengthier and complicated process than MMS is willing to undertake at this time,” the Record states.
Commercial fisherman David Gurney who has read the MMS filings in the Register, says it makes no sense to lease wave energy so far offshore, because the water is too deep. Current wave energy devices must be moored to the bottom and Gurney says the water is simply too deep that far out. He fears the entire MMS process could be a ruse to explore for oil and gas.
The MMS filing says the agency won”t rush its rulemaking process to approve any actual energy production. The process will provide legal framework for critics.
“We will continue to defer consideration of commercial OCS alternative energy projects until regulations governing alternative energy activities on the OCS are in place,” the filing states.
Public comments on the MMS process may be submitted by either of the following methods:
?Federal Rulemaking Portal: Under the tab “More Search Options,” click Advanced Docket Search, then select “Minerals Management Service” from the agency drop-down menu, then click “submit.” In the Docket ID column, select MMS-2008-OMM-0020 to submit public comments and to view supporting and related materials available for this rulemaking.
?Mail your comments to the following address: Minerals Management Service, Offshore Minerals Management, Alternative Energy and Alternate Use Team, 381 Elden Street, Herndon, Virginia 20170-4817.
