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FERC greenlights new Alaska hydropower project

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FERC greenlights new Alaska hydropower project

The Federal Energy Regulatory Commission has granted a hydropower license for Kenai Hydro LLC to build the 5-MW Grant Lake Hydroelectric Project in southern Alaska a little more than a decade after the company began exploring that option.

The project (FERC docket P-13212) will be on Grant Lake and Grant Creek, near the town of Moose Pass in the Kenai Peninsula Borough, and will take up a little more than 1.5 acres of federal land in the Chugach National Forest.

The project went through some bumps in the road, including in 2015 when FERC denied the developer's request to maintain priority rights for another six months to file a license application at the site. Commissioner Cheryl LaFleur at the time objected to the decision and said the move would "not encourage the development of new hydroelectric facilities, nor will it further the commission’'spolicy against site banking." Site banking, in concept, refers to when companies obtain permits for multiple projects in order to have first dibs on filing a license at those sites without the intention of building projects at all of those locations.

Even as droughts in Western states have put a dent in the nation's overall hydropower output, hydropower is making up an increasing share of total in-state generation for Alaska. From 2014 to 2016, hydropower accounted for slightly more than one-quarter of Alaska's total in-state generation, up by more than 4 percentage points from the prior three-year period, according to the U.S. Department of Energy's 2017 Hydropower Market Report.

In a supplemental update to the 2017 report, DOE in April 2019 indicated that 243 hydropower projects were at some stage of the development process in the U.S. as of the end of 2018, 41% of which are being developed as small conduit facilities that are typically not subject to FERC's licensing jurisdiction.

The commission's hydropower database indicates a dozen additional hydropower licenses are pending before the agency, most of which are for 20 MW or less. Two exceptions are pending license applications for Nevada Hydro Company Inc.'s proposed 500-MW Lake Elsinore Advanced Pumped Storage (LEAPS) (P-14227) in Riverside County, Calif., and Moriah Hydro Corp's proposed 240-MW Mineville Pumped Storage Project (P-12635) in Essex County, N.Y. The commission issued a draft environmental impact statement for the Mineville project in June.