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Dammed If You Don't

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Dammed If You Don't Abstract Non-powered dams (NPDs) present policymakers with low-impact opportunities for carbon-free, reliable clean energy production. This paper studies policy incentives for and regulatory barriers to NPD development by non-federal developers working on federal dams. Presenting case studies and interviews with industry voices working on dams owned by the US Army Corps of Engineers and Bureau of Reclamation, this paper explores common pitfalls undermining hydroelectric development at NPDs, as well as state and federal policy levers that have encouraged development. This project finds that arduous regulatory reviews, declining power purchase rates and insufficient policy recognition for hydropower have hindered development since 2005. Conversely, access to low-interest financing, supplemental income streams and expedient permitting processes, such as the Lease of Power Privilege, have presented a model to encourage future NPD development. Contact: Connor Bevan [email protected] (510) 414-7977 List of Abbreviations ALP...........................................................................................................Alternative Licensing Process ARRA...................................................................................American Recovery and Reinvestment Act C-BT.................................................................................................................Colorado-Big Thompson CREB......................................................................................................Clean Renewable Energy Bond CWCB............................................................................................Colorado Water Conservation Board CWRPDA.............................................Colorado Water Resources and Power Development Authority DOE......................................................................................................................Department of Energy EPA....................................................................................................Environmental Protection Agency ESA...................................................................................................................Endangered Species Act FERC........................................................................................Federal Energy Regulatory Commission FIT......................................................................................................................................Feed-In Tariff IBWC............................................................................International Boundary and Water Commission ILP..............................................................................................................Integrated Licensing Process ITC........................................................................................................................Investment Tax Credit kWh....................................................................................................................................Kilowatt Hour LIHI...................................................................................................Low-Impact Hydropower Institute LOPP.................................................................................................................Lease of Power Privilege MOU......................................................................................................Memorandum of Understanding MRES.....................................................................................................Missouri River Energy Services MW...........................................................................................................................................Megawatt NEPA.........................................................................................National Environmental Protection Act NHPA.............................................................................................National Historical Preservation Act NMFS...............................................................................................National Marine Fisheries Services NPD............................................................................................................................Non-Powered Dam NSD.....................................................................................................New Stream-Reach Development PPA...............................................................................................................Power Purchase Agreement PTC........................................................................................................................Production Tax Credit PURPA.........................................................................................Public Utilities Regulatory Policy Act REC..................................................................................................................Renewable Energy Credit RPS...........................................................................................................Renewable Portfolio Standard TLP............................................................................................................Traditional Licensing Process TVA..............................................................................................................Tennessee Valley Authority USACE......................................................................................United States Army Corps of Engineers USFWS......................................................................................United States Fish and Wildlife Service WMMPA.........................................................................Western Minnesota Municipal Power Agency Table of Contents Executive Summary.........................................................................................................4 Background......................................................................................................................5 Introduction............................................................................................................5 Federal Dam Ownership and Regulation...............................................................6 FERC Licensing.....................................................................................................7 Lease of Power Privilege.......................................................................................8 NPDs: A Contemporary Policy History..........................................................................9 Recent Federal Legislation..................................................................................10 State Policies........................................................................................................11 Literature Review..........................................................................................................15 Methods.........................................................................................................................17 Case Studies...................................................................................................................19 Mahoning Creek Dam.........................................................................................19 Granby Dam........................................................................................................22 Pine Creek Lake Dam.........................................................................................24 Red Rock Dam....................................................................................................27 Demopolis Lock & Dam.....................................................................................29 Ridgway Dam.....................................................................................................32 Green River Lake Dam.......................................................................................34 Analysis.........................................................................................................................36 Successful Projects............................................................................................36 Failed Projects...................................................................................................38 Thematic Analysis.............................................................................................39 Policy Recommendations..............................................................................................44 State Policy Recommendations..........................................................................44 Federal Policy Recommendations......................................................................46 References.....................................................................................................................49 Executive Summary As a carbon-free, reliable, baseload source of energy, hydropower offers policymakers a unique solution in the fight to decarbonize the energy sector. While concerns over the environmental footprint of new stream-reach dams have steered energy advocates away from hydropower, the electrification of non-powered dams (NPDs) offers hydro developers a low- impact alternative. The industry’s interest in federal NPDs - either under the ownership of the US Army Corps of Engineers or the Bureau of Reclamation - has led to the installation of hundreds of MW of new capacity on federal infrastructure since 2005. However,
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