Summary

GAO was requested to assess the Federal Energy Regulatory Commission's (FERC) efforts to streamline its licensing process to determine if the process has reduced license approval time. Information developed in a previous hydropower report and documentation gathered at FERC were used. Recent legislation mandated FERC to simplify its permitting and licensing processes for hydroelectric projects. The legislation required FERC to establish a program to use simple and expeditious licensing procedures in issuing licenses for small hydroelectric projects of less than 15,000 kilowatts (kw) at existing dams. The main thrust of each of three FERC orders to carry out its mandate is to clarify for the applicant exactly what material is needed for a complete permit or license application. The legislation also redefined a small hydroelectric project as having an installed capacity of less than 30,000 kw at an existing dam. FERC has recently delegated authority to act on permits and licenses to the Office of Electric Power Regulation. The Office can now approve all uncontested licenses and permits and will soon be given authority to approve contested permits and licenses in cases where one is clearly superior over the other.

According to FERC officials, processing time for approving permits and licenses has decreased. This decrease is attributed to both the streamlined regulations and the changes in internal procedures. It now takes from 4 to 6 months to process a preliminary permit as compared to the previous time of 17 to 19 months. Licenses for small hydropower projects now take 6 to 9 months to process instead of 13 to 16 months. Currently, there are about 90 projects pending before FERC that would qualify for a license exemption. Reductions in processing time have occurred without any increases in FERC staff. As the number of preliminary permits increases and they are processed faster, the number of license applicants will also increase. Therefore, GAO believes, as recommended in its earlier report, that the Chairman, FERC, should closely monitor the hydropower licensing process, and if the volume continues to increase, should request additional staff to ensure that streamlining efforts will not be impeded.