Overview of LIHI Certification Process

Presentation to UNIDO Expert Group Meeting on Sustainable Small Hydro

Philip Raphals Chair, Renewable Markets Advisory Commiee Low Impact Hydropower Instute

November 20, 2014 [email protected] “The Low Impact Hydropower Instute (LIHI) is a non-profit organizaon dedicated to reducing the impacts of hydropower generaon through the voluntary cerficaon of hydropower projects that have avoided or reduced their environmental impacts.” – LIHI mission statement www.lowimpacthydro.org

Project Size is Not a Consideraon (% of cerficaons to date) > 100 MW; <1 MW; 9% 20%

30-100 MW; 12%

5-30 MW; 1-5 MW; 24% 35% LIHI was conceived in 1998

• Inial leadership from American Rivers, Center for Resource Soluons and Green Mountain Power* • LIHI’s Goal -- create an independent, objecve and transparent source of informaon about hydropower to inform consumer choices in green energy markets • LIHI’s Strategy -- provide a market incenve to reduce the impacts of hydropower generaon • LIHI’s Vision -- – Improve environmental quality and favor investment in rivers – Provide recognion and economic benefits to suppliers of low- impact preferable renewable electricity

* Cerfying Hydropower for “Green” Energy Markets: The Development and Implementaon of the LIHI Cerficaon Program, Lydia T. Grimm (2002) hp://alturl.com/cxrc4 Why was this new approach needed for hydropower? • Hydropower has a long, successful history of electricity generaon BUT…. It has had a mixed history of environmental performance: – Flow modificaon below dams – Blockage and mortality of migrang fish and wildlife – Adverse changes in water quality – Flooding of riparian ecosystems • All hydropower issues are site-specific • There are real opportunies for avoiding adverse impacts • MW size is not an adequate indicator of impacts – Some low-MW projects involve large dams and impoundments – Small projects can cause significant environmental harm – More informaon is need to disnguish among projects LIHI governance includes a diversity of perspectives

Richard Roos-Collins, Water & Power Law Group Steve Malloch, Independent Consultant Dana Hall, Aorney Mike Sale, Independent Consultant Ken Kimball, Appalachian Mountain Club John Seebach, American Rivers Vicki Taylor, Catawba-Wateree Relicensing Coalion Laura Wisland, Union of Concerned Sciensts Pierre Bull, Natural Resources Defense Council GOVERNING BOARD Jack Palmer, Kleinschmidt Consultants (rered) > 50% environmental NGOs Glenn Cada, Oak Ridge Naonal Laboratory (rered) Tara Moberg, The Nature Conservancy

LIHI structure

LIHI Governing Board President, Secretary, Treasurer, members

Industry LIHI Staff Advisory Mike Sale, ED Committee Dana Hall, DD Renewable subcontractors Markets Advisory Committee

Management Revenue Technical Commiee Commiee Commiee

7/20/2014 LIHI presentaon to NHA Board 6 The current certification approach • Eligibility: Exisng facilies* and incremental new development at exisng dams in the US *unless formal recommendaon for dam removal • Seven criteria must be sasfied: – Flows – Water quality – Fish passage and protecon – Watershed protecon – Protecon of threatened and endangered species – Cultural resource protecon – Recreaonal resource protecon • Rely heavily on Resource Agency Recommendaons Resource Agency Recommendations • Formal recommendaons of state resource agencies mandated to protect resources • Prepared as part of federal licensing proceedings – regulator (FERC) not required to retain them – FERC must give « equal consideraon » to environmental and economic concerns • Even if FERC chose to ignore recommendaon, LIHI does not Example: Flows

• Goal: ensure that the river has healthy flows for fish, wildlife and water quality, including, where appropriate, seasonal flow fluctuaons characterisc of a natural system. • Standard: comply with recent Resource Agency Recommendaons for flows, or meet one of two alternave standards (Aquac Base Flow or Montanta-Tennant) to demonstrate that flows are appropriately protecve of water quality, fish and wildlife Proposed changes to LIHI certification critera • Principles and goals – reduce reliance on Resource Agency Recommendaons – base criteria on observable physical and biological features • Process – Technical Commiee proposal to Board – Public consultaon (over 60 comments received) – Review by Board and Technical Commiee – Results to be announced shortly Steps in LIHI certification process

• Intake Review – informal consultaon to assist in preparaon of the full applicaon • Formal Applicaon Review – reviewer evaluaon of Quesonnaire, public comment period, and recommendaon to Board • Cerficaon Decision – Governing Board acon or delegated to Execuve Director/Technical Commiee • Annual Reporng – status check on any special condions, plus annual fee payment • Recerficaon – re-examinaon of all criteria aer 5 to 8 years (including public comment) LIHI is now a nationwide program

To date, we have: 113 facilies cerfied, at ~170 dams, in 28 states.

The total capacity of LIHI-cerfied hydropower projects is 4.4 GW. Renewable Energy Policy In the US today… • Renewable Porolio Standards • Voluntary Green Power Purchasing • Public Benefit Funds • Net Metering • Federal Tax Credit Programs Renewable Porolio Standard

• The leading policy tool in the US to promote renewables • Ulies required to include growing percentage of renewables in the energy distributed to customers – Percentages and definions of eligible resources determined on a state-by-state basis • Objecves: – Reduce carbon emissions – Facilitate development of new renewable technologies that are not currently compeve with convenonal generaon Renewable Energy Cerficates (Green Aributes)

Source: Clean Power Markets hp://www.cleanpowermarkets.com/green_cerficates.php Renewable Portfolio Standard Policies Database of State Incentives for Renewables and Efficiency

www.dsireusa.org / March 2013.

29 states,+ Washington DC and 2 territories,have Renewable Portfolio Standards (8 states and 2 territories have renewable portfolio goals). Renewable Porolio Standards and Hydropower • Most RPS – Limit eligibility to new facilies – allow only “small” hydro (usually <30MW) • Four states currently require LIHI cerficaon for hydro to be eligible for premium er • Unusual for governments to rely on NGO cerficaon – But no real alternave for disnguishing low impact hydropower hp://www.cleanenergystates.org/assets/2013-Files/RPS/Environmental-Rules-for- Hydropower-in-State-RPS-April-2013-final.pdf

RPS and Hydropower AZ, CA, CT, DE, ME, MA, NH, NJ, NY, OH, OR, and PA impose environmental criteria for hydroelectric eligibility

hp://www.cleanenergystates.org/assets/2013-Files/RPS/Environmental-Rules-for- Hydropower-in-State-RPS-April-2013-final.pdf

RPS and LIHI Cerficaon DE, MA, OR, and PA require LIHI cerficaon in at least one RPS er. UT requires LIHI cerficaon for its voluntary Renewable Porolio Goal.

hp://www.cleanenergystates.org/assets/2013-Files/RPS/Environmental-Rules-for- Hydropower-in-State-RPS-April-2013-final.pdf

Class I REC prices in New England

Source: hp://www.renewableenergyworld.com/rea/blog/post/2013/08/nepool-rec-market-q1-2013-update Markets for LIHI-Cerfied Hydro RECs

• The principal market – RPS Compliance Markets: sell RECs to distributors with RPS obligaon ($10-$60/MWh) – Green Power Markets: sell RECs to green power marketers or project developers ($1-$5/MWh) • Other possible markets – Ulity Green Power Pricing programs • sell power to a ulity to include in a green pricing program – Community Aggregaon • respond to RFPs for aggregaon groups looking for green power

Green Power Purchasing

• Green-e: Leading US cerficaon program for renewable energy • Provides oversight for voluntary renewable energy transacons • Prevents double counng • Code of Conduct and Customer Disclosure Requirements Green-e Naonal Standard – Hydro Definion LIHI Value Statement

LIHI offers value to all stakeholders: ü Cerficate holders: new revenue streams ü NGOs: Incenves to reduce environmental impacts on rivers ü Green Power Purchasers: Verifiability ü RPS administrators: Accountability Philip Raphals, Chair, LIHI Renewable Markets Advisory Commiee [email protected] +1-514-849-7091

Mike Sale, LIHI Director [email protected] +1-865-719-4794

Dana Hall , LIHI Deputy Director [email protected] +1 -201-906-2189