Hydro Leader February 2022 by Water Strategies

Leader ydro H VOLUME 3 ISSUE 2

february 2022

Tom Fitzgerald of Schnabel Engineering on FERC’s New Dam Safety Rules

Rugged Trash Rakes and Trash Racks

Keep water intake free from debris and hassles.

Gene Power

, Paper & Steel Mills | Munic ration | Pulp ipal W ater I nt

Rugged trash racks and rakers keep water intakes free from debris and hassle. Our innovative debris capture solutions were developed at our own hydroelectric facilities. So, we mean it when we say... ”we use what we sell, every day.” Our trash racks and trash rakes are easy to install, operate and maintain. Our HDPE trash racks are practically maintenance free, designed to resist rust, corrosion, mussels and other marine life. Our patented electro-mechanical rakers have no hydraulics to maintain so they provide years of flawless performance. *Electro-mechanical Trash Raker U.S. Patent No. 7,815,811 & 9,539,528

akes | Wastew at e

ti o ns r Treatment Plants | Flood Control Pump Sta

For inquiries, please contact Shane Scott at 360.601.2391 or at shane@sscottandassociates.com

NC man dies after boat gets sucked into raging flow of dam floodgate June 4, 2018 (Also: July 2019*, May 2020, November 2020)

Public Safety Around Dams - Let’s Get Started “a licensee must install, operate, and maintain any signs, lights, sirens, barriers, or other safety devices that may reasonably be necessary or desirable to warn the public of fluctuations in

Worthington Public Safety Solutions Call

1.800.899.2977

Click

flow from the project or otherwise to protect the public in the use of the project lands and waters” Section 10c, Part 12 of the Federal Power Act

See what happens when a boat gets too close to an open floodgate.

tuffboom.com

Tom Fitzgerald of Schnabel Engineering on FERC’s New Dam Safety Rules

Contents

February 2022 Volume 3, Issue 2 5 C ompliance Culture By Kris Polly 8 Tom Fitzgerald of Schnabel Engineering on FERC’s New Dam Safety Rules

24 E mrgy’s Low-Cost, LowImpact, High-Performance In-Canal Turbines

28 E ddie Rich of the International Hydropower Association: Advocating 14 Kim Hansen of Kleinschmidt for Sustainable Hydro Associates: Putting at COP26 and on the the Challenges Posed World Stage by FERC’s New Part 12 Regulations in Perspective HYDRO LAW 34 Best Practices for Compliance With FERC 18 How the Bureau of Hydro Licenses Reclamation’s Lease of By Chuck Sensiba, Power Privilege Program Hallie Meushaw, and Relates to FERC Elizabeth McCormick

22 H udson Hollister of HData: Automating Compliance and Business Intelligence for FERC Licensees

38 JOB LISTINGS

Copyright © 2019 Water Strategies LLC. Hydro Leader relies on the excellent contributions of a variety of natural resources professionals who provide content for the magazine. However, the views and opinions expressed by these contributors are solely those of the original contributor and do not necessarily represent or reflect the policies or positions of Hydro Leader magazine, its editors, or Water Strategies LLC. The acceptance and use of advertisements in Hydro Leader do not constitute a representation or warranty by Water Strategies LLC or Hydro Leader magazine regarding the products, services, claims, or companies advertised.

4 | HYDRO LEADER | February 2022

Hydro Leader is published 10 times a year with combined issues for July/August and November/December by

an American company established in 2009.

STAFF: Kris Polly, Editor-in-Chief Joshua Dill, Managing Editor Elaine Robbins, Copyeditor Tyler Young, Writer Stephanie Biddle, Graphic Designer Eliza Moreno, Web Designer Caroline Polly, Production Assistant and Social Media Coordinator Tom Wacker, Advertising Coordinator Cassandra Leonard, Staff Assistant Eve Giordano, Media Assistant William Polly, Media Assistant Milo Schmitt, Media Assistant Amanda Schultz,Media Assistant SUBMISSIONS: Hydro Leader welcomes manuscript, photography, and art submissions. However, the right to edit or deny publishing submissions is reserved. Submissions are returned only upon request. For more information, please contact our office at (202) 698-0690 or hydro.leader@waterstrategies.com. ADVERTISING: Hydro Leader accepts half-page and full-page ads. For more information on rates and placement, please contact Kris Polly at (703) 517-3962 or kris.polly@waterstrategies.com or Tom Wacker at tom.wacker@waterstrategies.com. CIRCULATION: Hydro Leader is distributed to all hydroelectric facility owners in the United States, to hydrorelated businesses, and to every member of Congress and governor’s office. For address corrections or additions, or if you would prefer to receive Hydro Leader in electronic form, please contact us at admin@waterstrategies.com. hydroleadermag

hydro_leadr

/company/water-strategies-llc hydro.leader

hydroleadermagazine.com

COVER PHOTO:

Tom Fitzgerald, Western Regional Manager for Dam Engineering, Schnabel Engineering. Photo courtesy of Schnabel Engineering. hydroleadermagazine.com

PHOTO COURTESY OF SCHNABEL ENGINEERING.

Do you have a story idea for an upcoming issue? Contact our editor-in-chief, Kris Polly, at kris.polly@waterstrategies.com.

Hydro Leader

Compliance Culture

s owners and operators of hydropower facilities well know, compliance with the regulations of the Federal Energy Regulatory Commission (FERC) and other federal and state agencies is a major and crucial task. Building a culture of regulatory compliance within an organization is a key to planning and long-term success. This month, we bring you a number of articles on this important topic. In December 2021, FERC released a final rule amending its regulations on the safety of water power projects and project works, which introduced two tiers of public safety inspections, codified existing guidance on owners’ dam safety programs;, and updated regulations related to public safety incident reporting. It also released four new draft chapters to its Engineering Guidelines for the Evaluation of Hydropower Projects. In this month’s cover story, we speak with Tom Fitzgerald, the western regional manager for dam engineering at Schnabel Engineering, about what the new rules mean. Next, we speak with Kim Hansen, a senior engineering consultant with Kleinschmidt Associates, who has conducted more than 100 Part 12 safety inspections over his career, about how the new FERC rule will affect Part 12 inspections from both the independent consultant’s and the owner’s perspectives. We also speak with Max Spiker, the Bureau of Reclamation’s senior advisor for hydropower, about the sometimes-confusing topic of how Reclamation’s Lease of Power Privilege program relates to FERC regulations. It is not always immediately apparent which of the two agencies— Reclamation or FERC—has jurisdiction over nonfederal development on Reclamation project facilities. Mr. Spiker tells us about how such questions are resolved and about the streamlined lease of power privilege authorization process. HData is a tech company that has developed a platform that uses regulatory data to automatically generate and file FERC reports and can also provide data about how a

By Kris Polly regulated entity compares to its peers across the industry. HData founder and CEO Hudson Hollister tells us about the company’s current offerings and future plans. We also speak with Tom Cuthbert, the chief technology officer of Atlanta-based modular hydropower manufacturer Emrgy, about how the company has developed, piloted, and commercialized a unique hydropower device that can be easily deployed in water conveyance canals and channels. Eddie Rich, the CEO of the UK-based International Hydropower Association (IHA), tells us about the organization’s vision of a clean energy future supported by sustainable hydropower and about how IHA promoted that vision at the 2021 United Nations Climate Change Conference, known as COP26. We close with a Hydro Law article on FERC compliance by Chuck Sensiba, Hallie Meushaw, and Elizabeth McCormick of law firm Troutman Pepper, which highlights the importance for owners and operators of FERC hydropower licenses to fully understand their legal obligations and rights related to FERC compliance. Compliance with the regulations of FERC and other federal and state agencies is not simple, but it is an important part of guaranteeing the safe maintenance and operation of hydropower facilities. I hope that you find this issue of Hydro Leader, which approaches the topic from many angles, to be enlightening. H Kris Polly is the editor-in-chief of Hydro Leader magazine and the president and CEO of Water Strategies LLC, a government relations firm he began in February 2009 for the purpose of representing and guiding water, power, and agricultural entities in their dealings with Congress, the Bureau of Reclamation, and other federal government agencies. He may be contacted at kris.polly@waterstrategies.com.

hydroleadermagazine.com

February 2022 | HYDRO LEADER

New Revenue Stream Low Impact

High Energy Output Cost Effective

Unleashing water’s natural power Delivering modular, scalable hydropower without the need for construction

u Tailrace-friendly, hydropower turbine modules that don’t affect your waterflow u Installation is easy - no site work or permits u Modular and scalable power generation 5kW - 1MW u Zero risk - can be installed or removed quickly

Learn more about our technology and how we can help you and your customers in these difficult times. We’re all in this together. Email Sales@Emrgy.com for more information.

www.Emrgy.com

Quality Engineered Steel Penstock Pipe Systems Leading the nation in reliable water transmission solutions since 1966. Northwest Pipe Company is the most experienced manufacturer of engineered water transmission systems in North America. Bar none. With locations across the continent, we’re nearby and ready to support your hydro project through design, specification, installation, and testing.

A legacy grounded in water.

Questions about a project? Contact us! Northwest & Midwest Region Neal Kelemen nkelemen@nwpipe.com 303-478-8342

Southwest Region Michael LaBroad mlabroad@nwpipe.com 909-839-3978 714-602-6022

Texas Region William Ast wast@nwpipe.com 817-304-8991

Atlantic Region Gary Lewis glewis@nwpipe.com 614-537-7549

NWPIPE.COM

Tom Fitzgerald of Schnabel Engineering on FERC’s New Dam Safety Rules

Tom Helper of Schnabel Engineering inspects a radial gate at Seattle City Light’s Boundary Dam, Washington.

n December 2021, the Federal Energy Regulatory Commission (FERC) released a final rule amending its regulations on the safety of water power projects and project works, contained in title 18, part 12, of the Code of Federal Regulations. The new regulations introduce two tiers of public safety inspections, codify existing guidance on Owners Dam Safety Programs, and update regulations related to public safety incident reporting. At the same time, FERC released four new draft chapters to its Engineering Guidelines for the Evaluation of Hydropower Projects. Chapter 15 concerns supporting technical information documents, chapter 16 covers the Part 12D program, chapter 17 covers potential failure mode analysis (PFMA), and chapter 18 covers risk analysis. In this interview, Tom Fitzgerald, the western regional manager for dam engineering at Schnabel Engineering, tells Hydro Leader about what the new requirements mean for dam owners and operators.

Tom Fitzgerald: I’ve been working on dam rehabilitation and design since I graduated college in the mid-1990s. For the last 10–15 years, I have focused on rehabilitation, evaluation, Part 12 inspections, and risk assessments for hydropower

8 | HYDRO LEADER | February 2022

Hydro Leader: Please tell us about Schnabel Engineering. Tom Fitzgerald: Schnabel Engineering started out primarily as a geotechnical engineering firm in the mid-Atlantic. As we continued to grow, we moved into other markets. In the mid‑1990s, we started our dam engineering practice. That evolved over the years, and it now accounts for more than half our revenue each year. We still have a strong geotechnical engineering practice focused on transportation and serving federal and energy clients. The third business line is tunnel design. In short, our focus is on geotechnical engineering, dam engineering, and tunnels. Hydro Leader: Please elaborate on your dam safety work. Tom Fitzgerald: We work on all types of dams, but most of my focus has been on hydropower dams. FERC has strict requirements for having an independent consultant (IC) perform reviews of licensed hydropower projects every hydroleadermagazine.com

PHOTO COURTESY OF SCHNABEL ENGINEERING.

Hydro Leader: Please tell us about your background and how you came to be in your current position at Schnabel.

dams. Schnabel started as an East Coast firm, but we have expanded in recent years into the western United States. I now manage our dam unit’s business operations in the western region, supporting offices in Seattle; Boise; Denver; and Longmont, Colorado.

ADVERTISEMENT 5 years. That process is generally referred to as a Part 12D inspection. The IC who leads that inspection needs to meet minimum qualifications and be approved by FERC’s Division of Dam Safety and Inspections (D2SI). I lead a few of those inspections every year as the IC. We also do quite a few studies, analyses, and investigations to make sure that dams meet current criteria. In cases in which the dams do not meet the criteria, we have been involved with the analysis, design, and oversight of construction for various rehabilitation projects. Typical projects include the stabilization of dams, the expansion of spillway capacity, and the refurbishment or replacement of aging equipment. Hydro Leader: What does it take to be approved by FERC as an IC? Tom Fitzgerald: It requires a minimum of 10 years of experience working on dams. Not only does FERC want you to have 10 years of experience, but it wants to make sure your experience is applicable to the structure you will be inspecting. For example, if you’re primarily a geotechnical engineer, I don’t think FERC would approve you as the IC for a concrete arch dam, because that’s not your area of expertise. Hydro Leader: Please tell us about FERC’s recent regulatory changes and how they relate to the field of risk-informed decisionmaking (RIDM). Tom Fitzgerald: FERC just released a final rule amending its regulations as well as four new draft chapters for its Engineering Guidelines. Previously, dam operators were required to do a Part 12D inspection every 5 years. The rules for these inspections had not been updated since the early 1980s. A lot has changed since then. The new rules codify updates, incorporating several changes to the requirements. One of the most significant changes is that FERC now requires two different types of inspections—a comprehensive assessment and a periodic assessment— which are to be conducted alternately every 5 years. The new guidelines essentially call for a comprehensive assessment every 10 years and a periodic assessment every 10 years. The comprehensive assessment is more detailed and requires a higher level of effort than what was previously prescribed by the Part 12 requirements. It also requires a larger team, including an IC and subject-matter experts for applicable technical disciplines, such as hydrology and hydraulics; geotechnical, geologic, and structural disciplines; and so on. The periodic assessment is intended to be less intensive. As part of the comprehensive assessment, FERC is requiring a semiquantitative risk assessment, which is new. Risk assessments were not previously required by FERC, but it started rolling out guidelines for RIDM about 5 years ago. Since then, several owners have seen value in the process and hydroleadermagazine.com

have signed up for pilot studies using the RIDM processes. These workshops typically involve FERC representatives, a risk facilitator, dam safety personnel, operations personnel, and subject-matter experts to provide technical input. FERC has defined four levels of risk analysis, from screening (level 1) all the way up to quantitative risk analysis (level 4). Hydro Leader: How does that differ from the risk assessments that dam owners and operators were previously required to do? Tom Fitzgerald: Previously, FERC did not require risk assessments. Some owners have opted to do them as part of the pilot studies, but these were voluntary prior to the new rules. Other federal agencies, such as the Bureau of Reclamation and the U.S. Army Corps of Engineers, have well-developed guidelines and processes for assessing risk at their dams. FERC has borrowed many of the concepts and technical information from these other agencies, but because FERC regulates dams owned by others, it has to approach risk a little bit differently. Hydro Leader: What changes have been made when it comes to PFMA? Tom Fitzgerald: Previously, potential failure modes (PFMs) were classified, per the FERC guidelines, into one of four categories. Category 1 was used for highlighted failure modes. These are the PFMs that have the highest significance considering their probability of occurrence or consequence. Category 2 covered failure modes that were credible but not highlighted. Category 3 covered failure modes for which there was not enough information and that required analysis to determine whether they were possible or not. Category 4 covered failure modes that were ruled out or not plausible. These category designations were often assigned in confused or inconsistent ways. The new guidelines provide a new screening process to rule out PFMs that are not physically possible and to evaluate the disposition of credible PFMs. Performing a semiquantitative risk assessment will help to evaluate the PFMs for a project and provide a consistent way to identify the PFMs that are driving risk. This will help owners to prioritize surveillance and monitoring and to implement risk reduction measures that provide the most value. Hydro Leader: Would you tell us about the new draft chapter 15, which revises requirements for supporting technical information documents? Tom Fitzgerald: FERC has now provided detailed, specific requirements for every part of those documents, including how your analysis should be presented, what level of detail is necessary, and how things should be documented and organized. Based on my review of a lot of projects over the February 2022 | HYDRO LEADER

ADVERTISEMENT Hydro Leader: To what extent were these changes inspired by dam safety incidents like the Oroville spillway incident in California or the Edenville and Sanford Dam failures in Michigan?

From left to right, Alex Rutledge, Jonathan Harris, and Tom Fitzgerald of Schnabel, pictured during a focused spillway inspection at Seattle City Light’s South Fork Tolt Dam, Washington.

Tom Fitzgerald: These changes were already in motion before the Michigan dam failures occurred. A couple of precipitating events over the past few decades inspired the new policies and procedures at FERC D2SI. For example, the 2005 failure of Taum Sauk Dam prompted FERC to begin requiring every licensee to prepare an Owners Dam Safety Program document to underscore the importance of having a formalized dam safety program. After the Oroville spillway incident, there was a lot of scrutiny on the dam safety community, and I am proud to say that as an industry we take the lessons learned from these types of incidents very seriously. An independent forensic team evaluated the incident at Oroville and an after-action panel was assembled specifically to evaluate FERC’s dam safety program. The U.S. Government Accountability Office also performed a review of FERC’s dam safety program and provided recommendations. Hydro Leader: What do you think the next steps dam owners and operators should take in response to these changes?

Hydro Leader: It sounds like each of these new changes most likely implies some extra work for dam owners and operators.

Tom Fitzgerald: From what I understand, there is going to be a 90‑day implementation period. FERC also realizes that it’s going to take time for owners, consultants, and FERC staff to absorb these new rules and guidelines. That’s not going to happen overnight. One of the biggest challenges that we have as an industry is that risk assessment is relatively new, and we don’t have a lot of facilitators and subject-matter experts with risk experience. I’m not sure if there are enough trained individuals to handle all these risk assessments in a way that’s meaningful and consistent. As an industry, we are all going to have to learn and adapt. I believe that these risk assessments will develop over the next cycle or two before they are consistently conducted at a high level. One of the challenges is providing adequate training so that these can be done well.

Tom Fitzgerald: That is a fair assessment.

Hydro Leader: Is there anything you would like to add?

Hydro Leader: Is there anything that might ease the load— for example, the introduction of less-comprehensive periodic inspections on an alternating 10‑year cycle?

Tom Fitzgerald: Change is always difficult, but for the safety of our projects, these new rules and guidelines are going to be beneficial. H

Andre Ball of Seattle City Light and Fred Snider of Schnabel Engineering inspect abutment geology at Boundary Dam for Seattle City Light.

years, I think that getting up to speed on this requirement and complying with it is going to require considerable effort from most owners.

10 | HYDRO LEADER | February 2022

Tom Fitzgerald is the western regional manager for dam engineering at Schnabel Engineering. For more on Schnabel Engineering, visit www.schnabel-eng.com.

hydroleadermagazine.com

PHOTOS COURTESY OF SCHNABEL ENGINEERING.

Tom Fitzgerald: That was the intent of FERC. It realized that it was asking for a bigger evaluation during the comprehensive cycle, so it wanted to lessen the requirements for the alternating cycle. However, I believe that most owners will see that the new rules and guidelines are going to increase the overall level of effort considerably, at least over the next two cycles.

2022 ANNUAL CONFERENCE

NWHA has chosen the theme of renewal as we move past

RENEWAL

the pandemic to reinforce within the industry our role in creating renewable

PORTLAND, OREGON

BRINGING TOGETHER HYDROPOWER FOR A RENEWED FUTURE

February 23-25, 2022 Portland Waterfront

energy, our

Marriott

capacity to

Downtown

renew all in our industry and renew our climate through clean energy solutions.

TOPICS INCLUDE: Climate Change

New Age of Integrating Hydro

Invasive Mussels in the Northwest

Recent Ecological Monitoring

Dam Safety in Practice

Experiences

Empowering Hydro with DEI

Policy Updates

Why You Should Know About the

Plant Condition & Asset

Columbia River Treaty

Management

Breakfast Club- Topical Networking

Legal 401

Discussions

Post COVID Hydropower Reality

INFORMATION AND REGISTRATION AT:

WWW.NWHYDRO.ORG

INVESTING IN THE FUTURE SUSTAINABLE DEVELOPMENT OF DAMS AND LEVEES

APRIL APRIL 11-14, 11-14, 2022 2022

April in San Diego–cool ocean breezes, beautiful sunsets...and USSD conference attendees converging on the Town & Country Resort!

What you’ll experience: • The Legacy Lecture sponsored by USSD’s Foundations Committee featuring Dr. J. David Rogers, Consultant and Professor at Missouri S&T (Rolla)

• Connections with colleagues during two evening receptions and during lunches in the Market Place (exhibit hall)

• Full afternoon of committee meetings (open to all attendees)

• The latest in products and services from some of the industry’s top companies and agencies

• Two plenary and over 100 technical track sessions

• Six workshops included in your full conference registration

• New conference offering – Women Who Give a Dam: Showcasing Women in the Industry technical session and luncheon

• Optional field tour to Lake Murray and San Vicente Dam • Wrap party at Casa de Reye in iconic Old Town

Will we see you there? For more information and to register: https://ussdconferences.org DIAMOND SPONSORS

PLATINUM SPONSORS

GOLD SPONSORS

SILVER SPONSORS

BRONZE SPONSORS

HYDRO TURBINE TECHNOLOGY

kaplan | francis | pelton | micro w w w. m ave l . co m

Kim Hansen of Kleinschmidt Associates: Putting the Challenges Posed by FERC’s New Part 12 Regulations in Perspective

Kleinschmidt performed analyses, designed remediation measures, and provided continuous onsite construction observation during the emergency spillway repair at Clear Branch Dam in Oregon.

the industry in New England and Albany, New York. I have lived in Madison, Wisconsin, for the last 27 years, and I joined Kleinschmidt about 7 years ago. My job here is to provide senior-level review and engineering support to our clients. I make sure that our staff is taking a broad view of our clients’ issues and offering creative solutions. I have been around long enough to have learned a lot of lessons from watching and keeping my eyes open. I am not smarter than anybody else in the room, I have just been alive longer, and I have paid attention to the world around me.

Hydro Leader: Please tell us about your background and how you came to be in your current position.

Hydro Leader: Please tell us about Kleinschmidt.

Kim Hansen: I have been in the hydro industry for more than 40 years. I received a degree in civil engineering from the University of New Hampshire, and then I worked in

14 | HYDRO LEADER | February 2022

Kim Hansen: Kleinschmidt has just over 200 people, which makes it pretty intimate. The company started in Maine, and now it is international, with offices across the country and in Canada. We are a niche firm that focuses on dams, hydroleadermagazine.com

PHOTOS COURTESY OF KLEINSCHMIDT ASSOCIATES.

im Hansen, a senior engineering consultant with Kleinschmidt Associates, has worked in the hydro industry for more than 40 years and has conducted more than 100 Part 12 safety inspections. Hydro Leader reached out to him for perspective on the hydro industry’s current challenges in complying with the new Part 12 rule released in December 2021 by the Federal Energy Regulatory Commission (FERC). In this interview, Mr. Hansen discusses how the industry can adapt to the new requirement for more intensive inspections in the face of limited budgets and a shortage of qualified consultants.

ADVERTISEMENT hydro projects, and environmental and permitting work related to those projects, so our expertise in dams and hydro projects matches that of larger companies. The other advantage Kleinschmidt has is that because we only have 200 people, we can be more focused on our employees and how to make our teams work well. We put teams together based not just on experience but on staff career development and client needs. Hydro Leader: What are the main challenges dam owners and operators face in complying with the regulations of FERC and other federal agencies? Kim Hansen: The challenge for hydro owners, especially when it comes to dam safety and compliance, is to maintain and operate their projects in a safe, reliable manner with half the funding they had 40 years ago. That is a huge challenge, and I am impressed that the industry is able to meet it. In light of that, what owners need from consultants are practical and economical ways to address dam safety and regulatory issues related to relicensing and permitting. Hydro Leader: In addition to doing work on Part 12 inspections, do you also work on initial permitting and license renewals? Kim Hansen: Yes. Although my focus is mostly on dam safety and the development of new hydro, Kleinschmidt is well known for its relicensing strength and has a solid, professional, and knowledgeable staff. Hydro Leader: For a Part 12 inspection, does an owner or operator bring Kleinschmidt on just for a single inspection, or is there a longer-term relationship? Kim Hansen: We prefer and enjoy establishing long-term relationships. There is an inherent efficiency to repeating Part 12 inspections, because our staff becomes familiar with the facilities. We have clients with which we have worked for 50 years, and they come to us regularly for their dam safety work. However, according to FERC limitations, we can only work on the same project for two cycles. We can do two 5‑year inspections in a row, but the company is locked out of the one after that. It makes sense to have a different set of eyes looking at a project from time to time. The new regulations keep that limit in place. Hydro Leader: After the two consecutive cycles, would the client put out a request for proposals? Kim Hansen: Most utilities have a stable of consultants that they’ve worked with in the past or that have been recommended by their peers. They’ll typically put a request for proposals out to three to five companies for the 5‑year inspections. hydroleadermagazine.com

Kleinschmidt staff Stephen Spicer, Kim Hansen, and Russ Sanford take part in an Owners Dam Safety Program audit for a client.

Hydro Leader: Would you walk us through what a Part 12 inspection looks like in practice? Kim Hansen: Historically, the approved independent consultant (IC) would get background information, get up to speed on the project, identify resolved and unresolved safety issues, and do an initial site visit. In the last 20 years or so, risk assessments have been incorporated into the dam safety process, so now a potential failure mode analysis (PFMA) document needs to be reviewed prior to the formal inspection and then formally reviewed on site with FERC and the owner. Those reviews allow FERC, the owner, and the engineering consultant to see whether the failure modes are up to current standards and whether there have been changes over the last 5 years that could affect dam safety. The consideration of new potential failure modes is always part of the process, and if there are any of potential significance, you evaluate those risks. After the initial review is complete, the IC or the consulting team goes out with the licensee and FERC to inspect the project. It is mostly a visual inspection—you walk on the embankments and all the water-retaining structures, and depending on the site, you might take a boat upstream and downstream to get a better look at the facilities. If there are radial gates, there needs to be an up-close inspection every 10 years. That might require a climbing team with ropes. I have done a lot of those in the past. Finally, the IC writes the inspection report, including a review of all the documentation they have just updated, and then submits it to the client and to FERC. Hydro Leader: Is there always an IC involved in a Part 12 inspection, or do some large utilities use an in-house inspection team? February 2022 | HYDRO LEADER

| 15

ADVERTISEMENT Kim Hansen: FERC has gotten much more sophisticated about dam safety over the years. In the past, licensees considered FERC to be in charge of dam safety. They thought FERC would come to the project every year, and every 5 years they would have an IC complete a review. The licensee did not have to worry too much about dam safety because everybody was advising them. But in the last 10–20 years, the thinking has changed. Now, owners are required to have their own Owners Dam Safety Program in place, which is a written safety plan that demonstrates how the company handles dam safety. As a result, the owners have to inspect their projects annually and have ICs do an inspection every 5 years. The new FERC requirements also say that the IC needs to be accompanied by a team. Historically, you would have a single inspector and might bring in a geotechnical engineer for a complicated geotechnical problem with maintenance or stability issues or a mechanical engineer to review an issue with high-risk gates. Now, the lead IC will always be accompanied by a team. I think that is a good idea. Hydro Leader: You also mentioned that you do work for the design and permitting of new construction. Would you tell us about that process?

Hydro Leader: You have done Part 12 inspections of timber crib and timber buttress dams. Are inspections of those types of dams significantly different from others? Kim Hansen: There were once quite a few timber dams in the Northeast, but they are typically older, and there

16 | HYDRO LEADER | February 2022

aren’t many of them left. Timber dams are not as longlived as steel, concrete, or embankment dams. When I first got started 40 years ago, I designed a few repairs for timber dams. Typically, a timber dam has a gridwork of timbers filled with rock and overlaid with wooden planking. Sometimes, it’s a big rectangular structure; sometimes, it is triangular. Typically, it is overlaid with concrete, because it’s too expensive to repair and it is best to encapsulate it. Hydro Leader: You talked earlier about how one of your roles as a consultant is to help dam owners and operators meet requirements in an affordable manner. How do you go about that? Kim Hansen: When it comes to inspections, it’s a matter of experience. You go through the documentation in a progressive, efficient way to shave costs. We get the data efficiently and document them properly so it only has to be done once. It also involves getting the right level of people involved. If I am the IC, I would have someone who is in training to be an IC do an initial review, make sure that the documents are complete and accurate, and then walk me through what’s there. I leverage my time and delegate work to less expensive staff. As I mentioned before, the new FERC process requires a team of engineers. We think this new process will multiply costs by a factor of four because it will require a much more comprehensive inspection process and a much more thorough review of all the analyses. The new regulations require independent confirmation that previous analyses are correct. This will typically involve a separate but hopefully simple set of calculations for comparison. This is just one example of why future hydroleadermagazine.com

PHOTOS COURTESY OF KLEINSCHMIDT ASSOCIATES.

Kim Hansen: It’s possible to build a new dam today, but you have to clear some pretty high hurdles, especially with the resource agencies and the potential for environmental effects. So today, we’re not building many new dams, aside from pumped storage projects and off-stream dams with smaller environmental effects. Most of the time, we work on putting new hydropower projects on existing dams that were originally built for flood control or navigation. The largest environmental effects often occurred during the construction of the original dams, and the additional effects of adding hydro generation are not nearly as great—they may include effects on dissolved oxygen and temperature or the risk of injury to fish. In addition to the environmental review, there are two parts of a regulatory overview for putting in new hydro at an existing dam: First, does it affect dam safety on the existing dam, and second, does it affect the dam’s primary purpose, such as navigation or flood control? If you’re doing hydropower on almost any federal dam, FERC, the U.S. Army Corps of Engineers, and the Bureau of Reclamation may all be involved in the permitting process, which makes it complex from a regulatory standpoint. Wading through all the environmental reviews, agency consultation, and dam safety reviews to permit a new hydro development could easily take 5–10 years.

Kleinschmidt team member Emily Erhart takes part in a dam inspection.

ADVERTISEMENT Part 12 inspections are going to require more scrutiny and, therefore, be more expensive. Hydro Leader: How will these changes affect your work? Kim Hansen: Dam safety is our primary concern, and in that respect, the new regulations are a good thing. We are going to catch more issues earlier. But it’s going to cost more. We’re already running up against a shortage of ICs to do the work. If there are 100 Part 12 inspections that need to happen in a typical year, it will take four times as much effort to do each one, which means four times more work. Who’s going to do that work? FERC is aware of the issue. We need to do a better job recruiting new talent to the industry. At Kleinschmidt, we’re working to address the issue. It’s our job to make sure that we’re getting bright young minds interested in the profession to help solve that challenge in the future.

Kim Hansen: As with any new program we have gone through in the dam safety industry, there is a learning curve. PFMA is a great example of that. The risk analyses we performed during the first year were okay. Five years later, when we went back to review those initial reports, we could see that our processes had improved considerably with time. It is going to be the same way with these new regulations. The learning curve applies to FERC, too. FERC is going to learn that we need to focus more on certain things than others. There will be improvement as we go through the process. It is going to be a challenge to get there, especially in today’s tariff market, where rates stand at 2 cents or less per kilowatthour. But who knows where the marketplace is going? The current focus on renewable energy is good for the industry and, going forward, it may be even better. Maybe hydro will get the same benefits that wind and other renewable energy sources get. Hydro Leader: Is there anything else you would like to add? Kim Hansen: After the failures of Sanford and Edenville Dams in Michigan in May 2020, FERC came up with the idea of the industry providing financial assurance to help with needed improvements that some owners weren’t doing. It would require everybody to buy insurance or to deposit money in an account that FERC would control. This didn’t sit well with the industry. I’d rather see the solution come from the enforcement side so that FERC can make sure the rules are being followed or step in with procedures that address dam safety issues. Overlaying another financial burden on the industry is not the right way to go. The industry has voiced its opinion loud and clear, but it is an issue that still needs a solution. Hydro Leader: What is your vision for the future?

Kleinschmidt staff take part in an Owners Dam Safety Program audit.

Hydro Leader: Does Kleinschmidt recruit people by offering internships? Kim Hansen: We have always offered internships. We also do outreach in elementary, middle, and high schools to discuss the hydro industry and career opportunities. In addition to those efforts, we have a close partnership with the University of Maine and work with other colleges that are close to our regional offices across the United States. It is important to make students aware of the opportunities and to show them that this is an interesting industry in which to have a career.

Kim Hansen: I am bullish on the industry. There is a renewed interest in renewable energy, and hydropower is a huge part of that. The percentage of overall power generated by hydropower is not as high as it used to be; we are generating a lot more power from other sources. Hydropower has a unique place in the marketplace: It is reliable with black start capability and grid support. I am confident that hydro has a bright future. H

Kim Hansen is a senior engineering consultant at Kleinschmidt Associates. He can be contacted at solutions@kleinschmidtgroup.com.

Hydro Leader: How else will the revised FERC regulations affect your work? hydroleadermagazine.com

February 2022 | HYDRO LEADER

| 17

How the Bureau of Reclamation’s Lease of Power Privilege Program Relates to FERC

Electricity is generated under a LOPP contract at Ridgway Dam in Ridgway, Colorado, part of the Dallas Creek Project.

ederal initiatives to boost hydroelectric potential at federally owned facilities have led the Bureau of Reclamation to offer lease of power privilege (LOPP) contracts, which authorize a nonfederal entity to use its facilities to generate hydropower. However, it is not always immediately apparent whether nonfederal development on Reclamation project facilities will fall under the jurisdiction of Reclamation or of the Federal Energy Regulatory Commission (FERC). In this interview, Max Spiker, Reclamation’s senior advisor for hydropower, tells us about how such questions are resolved and about how the streamlined LOPP authorization process works. Hydro Leader: Please tell us about your background and current role at Reclamation.

Hydro Leader: Please explain what LOPP is and under what circumstances it may be used.

18 | HYDRO LEADER | February 2022

Hydro Leader: What kinds of entities have applied for authorization under this program? Max Spiker: We get a mix of interested parties. Applicants are usually the operating entities or beneficiaries of the proposed Reclamation project site, including entities such as water users’ associations, water conservancy districts, and irrigation districts. We also receive applications from power plant developers. hydroleadermagazine.com

PHOTO COURTESY OF THE BUREAU OF RECLAMATION.

Max Spiker: I’ve been at Reclamation for almost 34 years. I started in power plant maintenance and later worked as a hydroelectric mechanic at Hoover Dam. I then gravitated toward the management and supervision of power facilities. I’ve spent over a decade in Reclamation’s Power Resource Office. As the senior advisor for hydropower, I lead the oversight of the programmatic functions of Reclamation’s hydropower program—not only the policies, but also the initiatives implemented within Reclamation’s hydropower program to ensure that we produce reliable and cost-efficient power. I work with our customers to ensure that our facilities are maintained at operational and reliable levels, providing the value our customers expect and deserve.

Max Spiker: Nonfederal hydropower development contributes to local economic development, clean energy, and the climate change initiatives pursued by the Biden administration. Reclamation is committed to facilitating the development of nonfederal hydropower on our existing federal projects. A LOPP is a contractual authorization issued by Reclamation to a nonfederal entity to allow it to use a Reclamation dam, reservoir, or conduit for hydropower generation. It is important to note that any nonfederal hydropower project developed on a Reclamation project must not impair the efficiency of any Reclamation-generated power or water deliveries, jeopardize public safety, or negatively affect any other Reclamation project purpose. Reclamation has a statutory obligation to protect the underlying Reclamation project and related resources to ensure continued, unimpaired operations and stewardship for the benefit of our customers and stakeholders. For these reasons, federal oversight over the nonfederal project is necessary, either through the LOPP process or, if applicable, the FERC licensing process.

ADVERTISEMENT Hydro Leader: How many LOPP projects have been developed and how many are in active development? Max Spiker: There are 14 LOPP facilities currently operating on Reclamation projects, which comprise 53 megawatts (MW) of capacity. Of those, 10 have been brought online since 2009. An additional five conventional hydropower projects, comprising approximately 16 MW, are currently in active development through the LOPP process. These nonfederal projects allow Reclamation and our stakeholders to derive additional value from existing Reclamation projects. In terms of development trends, despite Reclamation efforts, nonfederal development is entirely dependent upon an interested developer acting in favorable market conditions. Reclamation facilitates the development and agreement process. More favorable market conditions and regulatory frameworks, namely state renewable energy portfolio standards and other incentives, may help spur future development. Hydro Leader: What is the best way for a potential nonfederal developer to learn more about the LOPP process? Max Spiker: Reclamation has developed several resources to aid prospective developers. I invite readers to visit our LOPP website (www.usbr.gov/power/LOPP) to get familiar with the process and available tools and resources, including reports on untapped hydropower potential on existing Reclamation project facilities. The website includes contacts for our LOPP program, including staff from my office and regional leads who are available to provide advice and answer questions related to the process and sites of interest. The website also has a summary of federal and nonfederal development activity on Reclamation projects. Updated quarterly, that summary is the best source for timely information on hydropower development on Reclamation projects. Hydro Leader: How is it decided whether a given development should be pursued under a Reclamation LOPP or a FERC license? Max Spiker: Both Reclamation and FERC are authorized by Congress to permit the use of Reclamation project facilities to nonfederal entities for the purposes of hydropower development. In the interest of promoting the timely development of nonfederal hydropower, the two agencies have entered into two complementary memoranda of understanding (MOUs) to help define jurisdictional boundaries. Unless specified by law, Reclamation project facilities authorized for federal power development fall within the exclusive jurisdiction of Reclamation, so nonfederal development there would proceed through the LOPP process. Conversely, Reclamation project facilities not authorized for federal power development are within the exclusive jurisdiction of FERC. hydroleadermagazine.com

There are couple of cases where the law explicitly specifies Reclamation LOPP jurisdiction. The Bureau of Reclamation Small Conduit Hydropower Development and Rural Jobs Act (PL 113‑24) places nonfederal small conduit hydropower development sited on Reclamation projects within the exclusive jurisdiction of Reclamation. In effect, all nonfederal hydropower development sited on a Reclamation project conduit would proceed through the LOPP process. Similarly, the Infrastructure Investment and Jobs Act (PL 117‑58) places nonfederal pumped storage hydropower development exclusively using Reclamation project reservoirs within the jurisdiction of Reclamation. These projects would be authorized via LOPP, regardless of whether the applicable, underlying Reclamation site or sites were originally authorized for federal power development. Nonfederal entities are free to contact either Reclamation or FERC to initiate the development process. Once either agency is contacted, the agencies consult the MOUs and applicable authorities to determine jurisdiction. Once jurisdiction is determined, the developer is notified, and the project proceeds through the appropriate permitting process. Hydro Leader: Is it usually clear whether the power development authorization existed in the first place, or are there ambiguous cases in which the two agencies need to work out the jurisdiction determination? Max Spiker: It is not always clear. Some power authorizations are explicit and clear cut, and some are not. Keep in mind that some authorizations are well over a century old now, and some have been amended numerous times. The MOUs lay out a process for determining jurisdiction both in cases in which the authorization is explicit and clear cut and in those in which it is more ambiguous. When it comes to determining jurisdiction under the MOUs, Reclamation is afforded the opportunity to submit a preliminary determination to FERC, but the final jurisdiction determination is made by FERC, not Reclamation. Each Reclamation project facility is subject to one (and only one) agency jurisdiction and permitting process in accordance with the MOUs and/or applicable law. Developers and federal agencies cannot freely choose which permitting process to follow. Hydro Leader: What are the potential overlaps between Reclamation’s and FERC’s jurisdictions? Max Spiker: Per our MOUs, no overlaps exist between the jurisdictional boundaries of Reclamation and FERC. Each Reclamation project facility is within either Reclamation’s or FERC’s jurisdiction. With that said, nonfederal pumped storage development sited in part on Reclamation project facilities would require both a Reclamation LOPP and FERC license if the proposed nonfederal project uses a Reclamation project reservoir within the jurisdiction of Reclamation and any second nonfederal reservoir, preexisting or to be constructed, within the jurisdiction of February 2022 | HYDRO LEADER

| 19

ADVERTISEMENT FERC. Currently, Reclamation is aware of four proposed nonfederal pumped storage projects subject to both Reclamation and FERC jurisdiction. Hydro Leader: What kind of issues arise that need to be solved in these cases? Max Spiker: These dual jurisdiction projects are a relatively new phenomenon. The two agencies are actively coordinating to administer our respective permitting processes in a common-sense, streamlined manner for the benefit of the project developer, project stakeholders, and the federal government in accordance with all statutory, regulatory, and policy requirements. FERC has been a great partner in this effort, and we look forward to continued coordination in pursuit of our mutual goal of the timely development of nonfederal hydropower. Hydro Leader: How does the LOPP proceed once it is determined that it is the correct process?

20 | HYDRO LEADER | February 2022

Hydro Leader: Does Reclamation have continuing oversight roles with projects under the LOPP? Max Spiker: We do have oversight roles on LOPP projects. Once the LOPP project comes online, Reclamation continues to oversee it to ensure that all LOPP contract terms and conditions are being met. These terms and conditions exist to ensure that there are no negative effects on the underlying Reclamation project. This oversight includes periodic inspections of the LOPP project. Hydro Leader: What is your vision for the future of the LOPP program? Max Spiker: We support the nonfederal development of power dams, reservoirs, and conduits. As I’ve mentioned, the LOPP program allows our stakeholders to derive additional value from existing Reclamation projects while contributing to local economic development and clean energy and climate change initiatives. Really, it is the energy market that is driving the development of these projects. Whenever it is economically feasible to build these projects, we will continue to support them. H

Max Spiker is the senior advisor for hydropower at the Bureau of Reclamation. He can be contacted at mspiker@usbr.gov.

hydroleadermagazine.com

PHOTO COURTESY OF THE BUREAU OF RECLAMATION.

Max Spiker: The complete LOPP process is described on our website. Once the process determination is made, Reclamation consults with our stakeholders and the local power marketing administration to evaluate interest in the federal development of the site. If federal development is declined (which has historically been the case under the current LOPP process), Reclamation may solicit nonfederal proposals for site development through a public process to ensure open and fair competition. This competitive solicitation process may not apply to small conduit hydropower projects proposed by conduit beneficiaries. Proposals are then evaluated, and a recommendation is made to the appropriate Reclamation regional director. Depending on the decision of the regional director, a preliminary lease may be awarded, in which case a costrecovery agreement is executed. Once the lessee is selected, all costs incurred by Reclamation in administering the LOPP project are to be reimbursed by the lessee. Reimbursable Reclamation costs include, but are not limited to, environmental and regulatory compliance activities and the review of LOPP project plans, designs, and studies. In general, the preliminary lease directs the lessee to conduct studies that allow Reclamation to evaluate potential effects on the underlying Reclamation project and related resources. These studies focus on public and dam safety impacts, project features and design, and security assessments. Compliance with the National Environmental Policy Act, the Endangered Species Act, the National Historic Preservation Act, and other applicable laws is evaluated during the preliminary lease phase. Provided that preliminary lease requirements are completed to Reclamation’s satisfaction, Reclamation then awards a LOPP contract. In general, during the LOPP contract phase, the lessee provides final project plans and specifications

for Reclamation’s review and approval—including project design drawings and specifications; construction, operations, and site restoration plans; the documentation of mitigation measures and environmental commitments made in environmental compliance documents and related documents; emergency action plans; and security plans. Provided that the plans are approved, Reclamation may give written authorization to commence facility construction. Developers are allowed 4 years from preliminary lease selection to begin construction for projects sited on dams and 3 years for projects sited on conduits. For awareness, over the past decade, we’ve streamlined our LOPP process in coordination with stakeholder groups, including our customers and operating partners, members of the industry, and others. The feedback has been overwhelmingly positive, and the process is working well. A report published in 2018 by the U.S. Department of Energy’s National Renewable Energy Laboratory found that “Reclamation’s efforts to streamline the LOPP regulatory process, beginning in 2012, coupled with federal statutory changes in 2013, have decreased processing timelines and have led to an increased interest in nonfederal hydropower development on Reclamation dams and conduits.”

INNOVATIVE HYDROPOWER EQUIPMENT MANUFACTURER

NuTURBINE™

Modular & scalable Kaplan turbine. Optimized for your sites performance.

NuTECH Controller™

Patented turbine intelligence control system add on. Increase efficiency by up to 20%

NuCONTAINER™

Replacing the classic powerhouse. A modular, prefabricated, standard shipping container powerhouse.

Questions? Contact Us! Info@NuSTREEM.com 860-724-2868

NUSTREEM.COM

Hudson Hollister of HData: Automating Compliance and Business Intelligence for FERC Licensees

Data is a tech company that has developed a platform that uses regulatory data to automate compliance and business intelligence for FERC-regulated entities. Hydro Leader spoke with HData founder and CEO Hudson Hollister about leading the charge for searchable data and the next generation of smart dashboards and predictive analytics to inform financial management and regulatory compliance. Hydro Leader: Please tell us about your background and how you came to be in your current position. Hudson Hollister: I used to be a frustrated bureaucrat. I was actually a lawyer working for the Securities and Exchange Commission (SEC). As many of your The HData team. readers probably know, public companies have to report their finances to the SEC. When I was at the SEC, I discovered that the agency was not using searchable data to analyze those reports. Lawyers and accountants at the SEC were using pencils and calculators to check the finance math. I resigned from the SEC and went to work on Capitol Hill to pass reforms requiring the SEC and other regulators to move away from unstructured, nonsearchable documents and start using data fields instead to track all the financial numbers. That work led me to the Federal Energy Regulatory Commission (FERC). In 2012, I started a nonprofit called The Data Coalition, which recommended that government regulatory agencies switch from documents to structured data. In 2015, FERC started working on the eForms Refresh Project, which culminated in FERC’s announcement in 2019 that it would transform the unstructured and old-fashioned PDF forms into searchable data using a data format called XBRL. With XBRL, every number in every schedule and form is its own data field. That transformation from unstructured documents to searchable data allowed the global standardization and exchange of financial data and enabled us to build the HData platform.

Hudson Hollister: HData is an early-stage tech company. We have a platform that works with FERC regulatory data. Our platform does two main things: compliance and business

22 | HYDRO LEADER | February 2022

Hydro Leader: Is FERC Pro your major offering, or is it one of several? Hudson Hollister: The HData platform is our major offering. We’ve used the FERC programs for the first version of our platform. Currently, our platform offers compliance and business intelligence. Right now, our main compliance tool is the IRIS Carbon platform, and our main business intelligence tool is our Data Hub. We just closed on $3.1 million of seed capital, so we’re going to be expanding hydroleadermagazine.com

PHOTOS COURTESY OF HDATA

Hydro Leader: Please tell us about HData’s products and services.

intelligence. For compliance, our platform can take financial spreadsheets and automatically turn them into FERC reports. We can then automatically check those reports against all the different rules that FERC has published and file them. For business intelligence, our platform can compare the finances, production, and performance of any FERC-regulated energy company to any other or to the industry as a whole. We do that using averages that reach 10 years into the past and are calculated in real time every 10 minutes as reports are filed. We have 29 enterprise customers in the energy industry. In December, we announced a major partnership with Alabama Power to design HData Insights, the next generation of energy regulatory business intelligence, and to bring smart dashboards and predictive analytics to inform financial management and regulatory compliance.

ADVERTISEMENT the platform, and we’ll be using the HData brand for that. Thanks to the investment and the new partnership with Alabama Power, we’re going to build additional business intelligence solutions, including HData Insights, a set of dashboards that automatically give executives the information they need to benchmark their production and their performance against any other recommended company. Hydro Leader: What are the main tasks that your clients need to carry out for their FERC licenses, and how are you helping with those? Hudson Hollister: Until recently, companies have had to take their financial spreadsheets and manually type every number into an outdated software platform called Microsoft Visual FoxPro. That is over, thanks to the data format FERC announced in October 2021. Our platform and other compliance tools can take a company’s spreadsheet and automatically turn it into the required report. That cuts out that manual transcription step. On the business intelligence side, most of the FERCregulated energy companies that we talk to do some sort of benchmarking. They might compare their operation and maintenance (O&M) expenses with those of other public utilities, or they might use metrics like O&M expense per megawatt-hour, O&M expense per customer, or O&M expense per dollar of revenue. Most public utilities do that kind of comparison. Until recently, it has been a laborious manual process. Most of the energy companies that we talk to have some kind of monster spreadsheet in which they manually enter numbers they derive from FERC forms. If they ever want to change the way they’re calculating metrics like that, it takes weeks. To add another company to those comparisons would be a huge project. We can do all those comparisons in 45 seconds. Hydro Leader: What kind of access do your clients generally need to give you? Do they just turn over those spreadsheets, or is there a way that you can get information on an automated basis? Hudson Hollister: If clients are using our platform for compliance, then they need to put their numbers into it in order to create the forms that our platform will file for them with FERC. If customers are using our business intelligence tools, they don’t need to give us any kind of access at all. All the analyses that we run come from publicly available data sources. Hydro Leader: Do you also provide services for the renewal of FERC licenses? Hudson Hollister: We can’t automate the preparation of FERC license applications, but we can automate any of the numbers that have to go into those applications that are derived from reports like Form 1 or Form 3-Q. hydroleadermagazine.com

Hydro Leader: Do you have any hydro clients yet? Hudson Hollister: Several of our customers have hydro production, but we haven’t zeroed in on that application yet. I’m excited to have a chance to do that. Because public utilities separately break out the finances and performance of each plant in one of the pages of their reports, we can track the finances of any plant against other plants, facility by facility, from 2011 to the present. Those who are familiar with FERC forms also know that when public utilities report their generation, their output, and their costs, they have to split them out by mode of generation. There’s a whole separate line of data for hydro. That means we can derive robust analytics and compare hydro with the other modes, utility by utility as well as plant by plant. Hydro Leader: How does your platform differ from others on the market? Hudson Hollister: We don’t have any competitors. As far as I know, HData’s platform is the only commercially available way to access all the data that are now available. I hope that we do get competitors, because it’s going to push us to move further and faster and to serve more energy companies. Hydro Leader: How should an energy company, or anyone who uses regulatory data, get in touch with you to see if HData’s platform is right for them? Hudson Hollister: If anybody is interested in doing instant analysis and comparison using any of the numbers that are contained by FERC Form 1, Form 3-Q, or other FERC forms, they should go to www.hdata.us and check out the publicly available information and videos of our solution. They can also contact us at info@hdata.us. Hydro Leader: What is your vision for the future of HData? Hudson Hollister: We are going to expand our compliance capabilities to include the additional forms and filings that regulated energy companies have to perform. We also plan to expand the business intelligence side to include more of the information that is filed by recommended companies. We’re going to integrate those two things together so that compliance can become smarter and business intelligence tools can provide historical, current, and predictive views of business operations. H

Hudson Hollister is the founder and CEO of HData. He can be contacted at hudson.hollister@hdata.us.

February 2022 | HYDRO LEADER

| 23

Emrgy’s Low-Cost, Low-Impact, High-Performance In-Canal Turbines

tlanta-based Emrgy has created a unique hydropower device that can be deployed in water conveyance canals and channels to transform them into power generation assets. Arrays of its modular devices can be deployed with no modification to or construction in the canals themselves. In this interview, Emrgy’s chief technology officer (CTO), Tom Cuthbert, tells us about how the company went from developing and piloting its device to commercializing and marketing its product around the world. Hydro Leader: Please tell us about your background and how you came to be in your current position. Tom Cuthbert: I’m the CTO at Emrgy. I joined the Emrgy team about a year ago. Prior to that, I worked at General Electric (GE) for 15 years on topics including rail locomotives, transmission and distribution, gas, power, and solar. Toward the end, I was CTO of the battery energy-storage division at GE Renewable Energy. I built an engineering organization around a new utility-scale battery storage and hybrid energy system that integrated storage with solar; wind; and other renewables, such as gas turbines. Emrgy has a strategic partnership with GE Hydro, which is how I got connected with Emrgy founder and CEO Emily Morris. We hit it off, and I thought it was a good time to make the transition from a big company to a small startup. I was excited about what the Emrgy team had already been able to achieve. Its product was an elegant solution to a seemingly complex problem. Hydro Leader: Please tell us about Emrgy and its products. Tom Cuthbert: Emrgy is a distributed hydro renewable energy company based in Atlanta with team members across the country. Our product is a hydrokinetic turbine that can be deployed in manmade water infrastructure to generate electricity from moving water. We develop our systems into arrays, deploying the turbines along the length of a channel or canal. We construct scalable projects based on the resource available. The size of the turbine is based on the water resource and the channel that it is flowing through. This essentially builds a grid of electric power that can be used to power local pumps or be fed into a utility, generating sustainable, renewable energy 24/7. Over the last couple of years, we have grown substantially, both organizationally and commercially, as we begin to deploy more product in the United States and around the world. In addition to our partnership with GE, we have strategic partnerships and distribution partnerships in place in Australia, South Africa, and Latin

24 | HYDRO LEADER | February 2022

America, and we are driving a lot of development with a focus on the western United States. Hydro Leader: Why might a customer opt for an array of Emrgy devices rather than a conventional hydropower facility? Tom Cuthbert: Emrgy’s product is low impact, low cost, and high performing. We’re able to deploy our devices with no modifications or construction to the physical canal. There are no dams or penstocks being built and no structural change needed. The turbines sit in the existing channel. Electrically, our arrays integrate into the power grid just like a solar array. It’s straightforward. We can come in at 40 volts or lower, though we generate at 480. A lot of work has gone into making our existing product cost effective. When we do our value assessment, we’re comparing ourselves to solar. That’s where we need to be competitive, and we’ve put a lot of work into how we sell and deploy our product to make sure that we’re competitive. We differ from solar in that one of the biggest values that we provide is 24/7 baseload generation, which is valuable to our customers and to electric utilities. In terms of performance, we’ve developed this product with an understanding of how to efficiently convert moving water into hydrokinetic energy with minimal effect on the water operations. You can operate your canal, head race, or tail race as you always did, while turning your moving water into an additional revenue stream by generating electricity. In addition to the mechanical structure, Emrgy’s controls and management ensure that we’re extracting the most energy out of the waterway as efficiently as possible. How we do that at the turbine level and across a whole array of units in a canal is Emrgy’s secret sauce, if you will. Hydro Leader: Would you tell us about how you moved from the stage of tech incubation to having a fully commercialized product? Tom Cuthbert: In our earlier days, we ran a successful pilot project in Denver. We also did extensive lab testing in one of the larger marine and hydro performance labs in the United States. Those exercises really refined Emrgy’s technology to make sure that it was high performing and robust. We want to make sure that once the units are installed, they’re going to last for 30 years without requiring much maintenance. We made some optimizations in the product between efficiency, performance, and impact to make sure that it had minimal impact and high performance. After achieving that, we worked to integrate our supply chain so that we could deploy our product at an economical and competitive price point. That was part of the journey to commercialization. Now, hydroleadermagazine.com

PHOTO COURTESY OF EMRGY.

Tom Cuthbert stands with one of Emrgy's modular hydrokinetic turbines.

we are scaling up production, orders, and our commercial reach, both domestically and internationally. Another big part of commercialization is making the solution financially accessible to our customers. For 2022, we’re very excited to offer our hosting program, in which we partner with irrigation districts to provide them a no-money-down, fully hydroleadermagazine.com

financed solution. It’s an appealing conversation to have with them, and we know it will accelerate the adoption of our solution in the market. We’ve now deployed several systems in the United States and around the world, thereby seeding the market with proof points of the technology’s capabilities and value proposition. February 2022 | HYDRO LEADER

| 25

ADVERTISEMENT Hydro Leader: Where do you manufacture the turbines? Tom Cuthbert: We manufacture them in the United States through partnerships and internationally through a partnership with GE. We have some flexibility in how we manufacture. Part of making this product cost effective and economical involved refining how we build. We have the ability to localize aspects of the manufacturing process or deploy them through partnerships. We do whatever is going to make the most sense for getting the product out there quickly and economically. Hydro Leader: What kind of entities are your customers? Tom Cuthbert: Our customers include consumers of electricity, including utilities, water districts, large commercial and industrial users, and others. However, our customers also include site hosts, which may include utilities or hydroelectric power operators with tail races, irrigation districts, and other canal owners. Hydro Leader: Can Emrgy devices fall under entities’ existing Federal Energy Regulatory Commission (FERC) licenses? Tom Cuthbert: It depends on the size of the project. If we make up less than 15 percent of the power authorized by an entity’s FERC license, we can add power to its existing operation without a large permit lift. We can also use the inconduit exemption if we come in adjacent to the conduits. Hydro Leader: What are some of your plans for the future development of your technology?

26 | HYDRO LEADER | February 2022

Hydro Leader: Is there anything you would like to add? Tom Cuthbert: Simply put, we want deploying our systems to be as simple and straightforward as installing a solar array. We’re trying to take hydropower from the idea of big project construction and long development permitting to something that can be put in the field and be operational in a short time. We are able to do that because we stand on the shoulders of what the solar industry has done over the last decade in its technology and business models. We are bringing hydropower into the arena of distributed renewable energy. Hydro Leader: What is your vision for the future of Emrgy? Tom Cuthbert: The future for Emrgy is really about scale. We have the technology, we have the product, we now have the financing solution, and we have the capability to do the things we set out to do. Most of our focus right now is on scaling the business commercially through direct sales; the deployment of our systems; project development; and partnerships, which we continue to cultivate and grow. We can bring value to rural communities by deploying additional revenue streams. We can bring value to canal operators by improving their economics, either through net metering the energy directly, offsetting their own consumption with it, or coming into it as a partner for a project that we’re developing through our new hosting program. Ultimately, the big focus is producing low-cost, sustainable, clean energy. H

Tom Cuthbert is the chief technical officer of Emrgy. He can be contacted at tom@emrgy.com.

hydroleadermagazine.com

PHOTO COURTESY OF EMRGY.

Tom Cuthbert: There are a few areas that we’re really focused on right now. One is digital. We know that our product, when deployed, generates a lot of data. It is essentially a large sensor in the canal that measures how much water is moving, how fast it’s moving, what the profile looks like, and how much power is being generated. We see opportunities there to create software and solutions that can help customers better use our systems in conjunction with their other operations. We want to see how our systems can help them operate their canal better while also optimizing energy production. We are able to remotely monitor and collect data from all the systems we deploy, but we’re developing solutions around more advanced analytics and software. We see big opportunities to create even more value. Having a product that can monitor remotely provides more benefits around troubleshooting and maintenance, making the product more robust, reliable, and economical. We see future opportunities to use this additional information to forecast clients’ water performance so that they can be better prepared to manage it. That also feeds a bit into managing our larger production models, which is something we’re developing now.

On the software side, we are also looking at more advanced controls to build a more homogenized, hybridized system. Instead of just generating hydropower, it would create a more complete system that incorporates other assets, such as solar or micro grids. On the hardware side, we are currently executing a program for which we received a large grant from the Advanced Research Projects Agency–Energy, which has to do with developing what we’ll call our next-generation hydrokinetic systems. We are looking at bringing more flexibility to how our systems operate across a range of water characteristics. We want to create a product that can more dynamically drive efficiency, increase capacity, increase the amount of energy generated, and drive down the levelized cost of energy as flow increases or decreases and water levels change.

Eddie Rich of the International Hydropower Association: Advocating for Sustainable Hydro at COP26 and on the World Stage

Eddie Rich (left) presents the San José Declaration at COP26 along with Malcolm Turnbull, the former prime minister of Australia (center).

Department for International Development (DFID). I served as the DFID’s representative to Angola and deputy head in Kenya and as the head of the department’s social responsibility team. I first became interested in this whole area of energy governance when I was working in Angola in the 1990s. Angola has vast oil, gas, and diamond resources, and at the time, it was in the midst of a war in which one side had all the oil and gas and the other side had all the diamonds. It seemed to me that simply providing aid was just offering a Band-Aid. It was clear we needed to look deeper at governance issues. That is what sparked my interest in energy transition—looking at sustainable hydropower and the process of encouraging equitable, well-governed energy transitions. It obviously presented an exciting opportunity. The EITI's former executive director, Jonas Moberg, and I developed an approach to multistakeholder governance that challenges conventional developmental wisdom and is summarized in our book Beyond Governments: Making Collective Governance Work—Lessons from the EITI. Hydro Leader: Please tell us about the IHA.

he International Hydropower Association (IHA) is a nonprofit membership association that serves as the voice of sustainable hydropower. IHA represents organizations committed to the responsible and sustainable development and operation of hydropower. Its members share a common purpose: to build a world where humanity’s energy and water needs are supported by sustainable hydropower. In this interview, IHA CEO Eddie Rich tells us about how the association is pursuing that goal. Hydro Leader: Please describe your background and how you came to be in your current position.

28 | HYDRO LEADER | October 2021

Hydro Leader: What are your primary messages for those audiences? Eddie Rich: First of all, that the only acceptable hydropower going forward is sustainable hydropower, and that sustainable hydropower is a clean, green, modern, and affordable solution to climate change. Hydro Leader: Please discuss the IHA’s role in the recent 2021 United Nations Climate Change Conference, commonly referred to as COP26. hydroleadermagazine.com

PHOTO COURTESY OF THE IHA.

Eddie Rich: I have been involved in the energy governance arena for more than two decades. I am now the CEO of the IHA, a role I have held for just over 2 years. Immediately prior to this, I was the executive director of the Extractive Industries Transparency Initiative (EITI), where I worked for 12 years. EITI is an effort to ensure better governance of the oil, gas, and mining sectors. It’s a multistakeholder model involving governments, companies, and nongovernmental organizations (NGOs). The initiative was designed to develop a multistakeholder standard for the better governance of the extractives sector, which has been implemented by more than 50 countries. Before that, I worked for the UK government’s

Eddie Rich: The IHA has been around for 26 years and exists to advance sustainable hydropower. Our interest is to increase understanding of the role of sustainable hydropower in the energy transition and in water management. We are a membership-based organization representing approximately 100 corporate members. While we are deeply committed to advocating the progressive ideals of those most committed to sustainable hydropower, in practice we are equally committed to encouraging an open platform for discussions with NGOs, governments, international financial institutions, media, and really with any interested stakeholder in the sector.

ADVERTISEMENT Eddie Rich: COP26 brought together governments and key stakeholders to address climate change. It was central that the IHA be there to be the voice of sustainable hydropower at the table and to try to raise awareness of hydropower’s role. Hydropower is currently the largest renewable energy source in the world. It can back up wind and solar, it can work alongside batteries, and it can be a supplier to green hydrogen. We are trying to change the discourse around hydropower to make sure that it is in the minds and the plans of the leading countries in the world. Hydro Leader: Did IHA also host panels at the conference? Eddie Rich: We organized and took part in a number of panels. At the Nordic Pavilion, we launched the San José Declaration on Sustainable Hydropower, which sets out the manifesto of our stakeholders in terms of the future of hydropower in the energy transition. We also spoke in the Russian Federation Pavilion, in the Water Pavilion, and at high-profile roundtables on the role of hydropower around the world. Because our delegation was led by Malcolm Turnbull, the former prime minister of Australia, who is a deeply passionate advocate for hydropower and particularly for pumped storage hydropower, we also had the opportunity to speak with a number of world leaders. Hydro Leader: What were your big takeaways from the conference? Eddie Rich: It’s difficult to assess whether or not COP26 was a success. We won’t be able to make a fair judgment about that until 3 or 4 years down the line. One important step was the agreement to phase down coal. That will likely lead to a gap in the future that will need to be filled in by something else. Will it be just another fossil fuel, such as gas, or something else, such as hydro? One of our colleagues came up with a slogan: Filling the hole left by coal. This is going to become the chief energy imperative over the next decade, and clearly, hydro can fill that role. There is no other technology that is better placed to successfully balance providing longterm energy storage while meeting long-range baseload needs. It is a resource that is available in most places in the world— not everywhere, but with good transmission infrastructure, it can be. That is where we have to position ourselves. I think COP26 has created a massive opportunity for us in that space. Hydro Leader: You mentioned changing the discourse around hydropower. What prevailing notions do you hope to correct or highlight? Eddie Rich: Dr. Fatih Birol, the executive director of the International Energy Agency, describes a hydropower as the forgotten giant of renewables. That’s absolutely right. We talk all the time about the need for wind and solar, which we totally support. But let’s not forget that until maybe last year, hydroleadermagazine.com

hydropower was bigger than wind and solar put together. I don’t mean to suggest that this is a competition, because we need a whole lot more of everything. We also need to think about what happens when the wind doesn’t blow and the sun doesn’t shine. We should be making good use of wind and solar on the grid, but we need a green backup, which is hydropower. Without it, we face the very real possibility of falling back into fossil fuel reliance or confronting regular blackouts. It seems to me that the world would be well served to recall and refresh its perspective on this tested and reliable technology, which is proven to provide not just baseload power, but also the sort of long-duration backup that will ensure that we get the most out of wind and solar. It is the only way to decarbonize an electricity grid. The frustrating thing is that people first focus on what new technologies are going to be needed. Certainly, we welcome new technologies. Yet in this moment of great need, we have all the technology we need to deliver net zero: wind and solar backed up by hydro and coupled with wider transmission networks to make the most use of those renewable energy sources across a much wider area. Hydro Leader: Would you tell us more about the San José Declaration? Eddie Rich: The San José Declaration on Sustainable Hydropower was the statement that emerged from the 3‑week-long World Hydropower Congress that took place in September 2021. It was a virtual event cohosted by the IHA; the government of Costa Rica; and the Instituto Costarricense de Electricidad, which is the Costa Rican national utility. The San José Declaration is named after the capital of Costa Rica. The declaration lays out a whole set of principles, commitments, and recommendations, which you can read at hydropower.org/declaration. We will hold our members to account against those principles. The recommendations lay out the steps and actions that governments and policymakers need to take to enable the sector to play its role in the energy transition. The two main takeaways from the declaration are, first, that sustainable hydropower is a clean, green, modern, and affordable solution to climate change and, second, that going forward, the only acceptable hydropower is sustainable hydropower. Hydro Leader: What specifically do you mean by sustainable hydropower? Eddie Rich: It’s really important that there is a clear, agreedupon international definition of sustainable hydropower. That’s what we’ve been working on for the last 15 years through the Hydropower Sustainability Council, a multistakeholder group of governments; companies; and NGOs, including the World Wildlife Fund, the Nature Conservancy, the International Union for Conservation of Nature, the World Bank, and many regional development February 2022 | HYDRO LEADER

| 29

ADVERTISEMENT banks. They’ve been working out the tools and requirements that would make up best practices related to sustainability, including issues of biodiversity, resettlement, engagement with indigenous peoples, climate resilience, and so on. These concepts have been ground-tested over the last 10 years. At the September congress, the Hydropower Sustainability Council launched that set of tools as the Hydropower Sustainability Standard. It’s aligned with the Climate Bonds Initiative’s requirements for green bonds and with the World Bank and International Finance Corporation sustainability framework as well as with the European Union’s and others’ green taxonomies. Overall, it’s internationally recognized as the definition of sustainable hydropower. The San José Declaration says that new projects should be assessed against these objectives. Hydro Leader: Another term you use to refer to your vision for hydropower is affordable. Many times, when people think about hydropower, they think of enormous hydroelectric dams, which are not particularly cheap to build or license. How can hydropower be made affordable? Eddie Rich: Hydropower doesn’t always entail massive projects. In reality, there are a whole range of hydropower projects and facilities, from the very small to the extremely large. Yes, some of those projects will be expensive, and with high capital costs, there’s always a delay in terms of return. But the projects that were built 100 years ago are still running. We don’t even know what the lifetime of a dam is. If it’s well maintained and modernized, then the only question is, “Does water continue to go through it?” In terms of affordability, the return over the life cycle of hydropower is among the best of all energy infrastructure projects. Hydro Leader: Does IHA advocate for favorable tax policies and incentives for hydropower?

Eddie Rich is the CEO of the International Hydropower Association. He can be reached at eddie.rich@hydropower.org.

Hydro Leader: Are there any other topics you would like to discuss?

30 | HYDRO LEADER | February 2022

hydroleadermagazine.com

PHOTO COURTESY OF THE IHA.

Eddie Rich: Absolutely. We should be taking a look at the electricity grid as a whole and determining the right balance between the various different sources of energy and how they should be backed up by storage in order to provide reliability, longevity, and affordability. Then, we should decide where to place the market incentives. We’re not asking for special treatment. We’re asking for a good system that assesses how to incentivize the market. There are all sorts of mechanisms for doing that. In India, the government provides a certain mandate for green energy storage. In the United States and China, there’s a big focus on capacity markets. Here in the UK, the government is thinking about a cap-and-floor mechanism that guarantees prices for storage provision.

Eddie Rich: I want to underscore the renewable aspect of hydropower, which is highlighted by the IHA’s work with the U.S. Department of Energy (DOE). We have been working closely with the DOE on several issues recently, with our efforts centering particularly on pumped storage. Kelly Speaks-Backman, the principal deputy assistant secretary for the Office of Energy Efficiency and Renewable Energy at the DOE, and Malcolm Turnbull are cochairing the International Forum on Pumped Storage, which comprises approximately 100 members, including governments and companies from around the world. The group’s focus has been on pumped storage and the policies that enable it along with recommendations that might incentivize its widespread use. The group published a report in September 2021 and has now turned to the next phase of its work. Another platform from which we can highlight the importance of pumped storage—and more broadly, longduration energy storage systems—is the 2022 Global Clean Energy Ministerial, which is being led by the DOE. In December, we had a meeting with representatives from the United States, China, and India focusing on this very subject. Those three countries represent more than half the world’s population and more than half the world’s energy needs. China noted that it is going to quadruple its pumped-storage capability, currently standing at 120 gigawatts (GW), by 2030. India reports it plans to build another 27 GW of storage, of which 10 GW will be pumped storage, by 2030. And the United States, of course, has undertaken its enormous infrastructure bill and sees the centrality of green energy storage as part of that, which will lead to incentives for additional pumped storage capacity. It is exciting, but it’s still not happening fast enough. We need a lot more momentum, and we believe it is essential that the United States continue to play a leading role in these efforts. The urgency of this situation cannot be overstated. Governments and private-sector entities are talking, but we need these commitments to now turn into actions and investments, and at a rapid pace. Furthermore, there is an often-ignored crisis within the crisis, which I alluded to earlier. We need to ensure that our investments in wind and solar are backed up by green energy, a role that hydropower is perfectly situated to fulfill. That is why we keep banging the table at the international level on behalf of our members and stakeholders and will continue to do so. We need to ensure that as electricity grids are enhanced, we do not make the mistake of overlooking the critical role hydropower can and should play in all of this. H

Setting the standard. Troutman Pepper is home to one of the largest and most experienced teams of hydropower attorneys in the United States. Our attorneys have more than 70 years of combined experience in the hydropower industry and have been involved in nearly 40% of all FERC-regulated hydropower projects nationwide. Learn more about our firm, including our hallmark higher commitment to client care, at troutman.com.

troutman.com Troutman Pepper Hamilton Sanders LLP

Bridging the gap between idea + achievement At HDR, we’re helping our clients push open the doors to what’s possible, every day. We can help you navigate the complexity of planning, designing, constructing, managing and operating your pumped storage facilities. Contact Us: Rick.Miller@hdrinc.com Kevin.Snyder@hdrinc.com David.Culligan@hdrinc.com

hdrinc.com

Your next hydro project is yet another balancing act of regulation, conservation, and power generation.

Sound Familiar?

At Anchor QEA, we understand the complex intersection of water, environment, and energy challenges, and we know that there are many compliance and permitting requirements necessary to develop hydropower and pumped storage. Our team of scientists, engineers, modelers, and planners is well versed in hydropower development regulations including NEPA, CEQA, FERC, LOPP, and more. We are ready to provide support and design services to get your project permitted, constructed, and generating electricity! www.anchorqea.com

(415) 361-5155 mgabaldon@anchorqea.com

HYDRO LAW

Best Practices for Compliance With FERC Hydro Licenses By Chuck Sensiba, Hallie Meushaw, and Elizabeth McCormick

n recent years, owners and operators of hydroelectric projects licensed by the Federal Energy Regulatory Commission (FERC) have had to adapt to a variety of statutory and regulatory changes, including revisions to the Federal Power Act, the National Environmental Policy Act, and the Clean Water Act and a variety of implementing regulations. At the same time, FERC has taken steps to make significant changes to its hydropower compliance program, including more frequent use of civil penalties for noncompliance, issuing a notice of inquiry (NOI) on financial assurances for hydroelectric licensees, and—very recently—issuing a final rule that introduces major changes to its dam safety program. While these initiatives have not always received the same degree of attention in industry conferences and media as emerging issues in FERC relicensing and environmental resources, hydropower operators face license implementation and compliance issues every day. Understanding trends in FERC’s compliance oversight is critical if hydropower owners and operators are to avoid pitfalls and remain in compliance with their licenses in the face of a changing landscape.

license obligations was taken into consideration in assessing the penalty, the amount of the penalty was calculated based solely on the licensee’s repeated failure to respond to FERC orders to take specific actions to remediate the damage in the months following the dam failures. Next, in October 2021, FERC issued an order to show cause and notice of a proposed penalty to Ampersand Cranberry Lake Hydro LLC, the former licensee of a hydroelectric project in upstate New York. Following Ampersand’s acquisition of the project via a license transfer in 2015, it failed—despite repeated requests and warnings from the commission—to make certain safety improvements designed to prevent dam failure during periods of high flow. In conjunction with its failure to make these dam-safety-related improvements, Ampersand’s lease of the project facilities was terminated for failure to pay rent to the lessor, in violation of article 5 of its license, which requires all licensees to obtain sufficient property interests in project facilities. Thereafter, the commission issued an order finding that Ampersand had been out of compliance with its license for a total of 88 days and that the maximum civil penalty was over $2 million. The commission’s order proposed a civil penalty of $600,000.

CIVIL PENALTIES

As hydropower licensees are aware, FERC has always prioritized license compliance. However, beginning with the 2017 failure of the spillway at the FERC-licensed Oroville Project in California, which required the evacuation of more than 180,000 people downstream of the dam, FERC has taken a renewed interest in dam safety and license compliance. In May 2020, historic flooding in Michigan led to the breach of Edenville and Sanford Dams. In this case, evacuation orders were issued for approximately 10,000 residents in the area. Following these events, the commission has increased its use of civil penalties for hydropower licensees. From 2013 to 2018, FERC issued only one civil penalty for a safety-related hydropower violation (for more, see the U.S. Government Accountability Office’s October 2018 report to congressional requesters on dam safety). However, in 2021 alone, FERC issued two such penalties. First, in April 2021, the commission imposed a historic $15 million civil penalty on the licensee for Edenville and Sanford Dams in Michigan for failing to follow FERC orders and staff directives following the catastrophic failure of the dams, which were estimated by the State of Michigan to have resulted in over $190 million in economic harm to the area. The civil penalty was one of the largest ever imposed by FERC and sent a strong message that the commission will not tolerate a licensee’s failure to take steps to mitigate and remediate harm immediately after a major dam safety incident. While the licensee’s significant history of noncompliance with its

34 | HYDRO LEADER | February 2022

FINANCIAL ASSURANCES

In his concurring opinion in the Ampersand order, FERC Commissioner James Danly wrote separately to underscore “how critical it is for the Commission to ensure that licensees have the financial wherewithal (and incentive) to physically maintain their facilities.” His concurrence noted the commission’s January 2021 NOI soliciting public comments on whether FERC should impose financial assurance requirements on hydropower projects to ensure that licensees have adequate financial resources to maintain their projects in safe condition. The NOI was issued partially in response to the Michigan dam failures discussed above. In that case, the licensee declared bankruptcy in the months following the dam failures, leaving insufficient resources to complete the over $300 million in needed repairs to the dams, reimburse property owners for damages caused by flooding, and pay the $15 million civil penalty imposed by the commission. The commission’s NOI explained that an increasing number of projects have become either nonoperational or have fallen into noncompliance with FERC license conditions “where licensees have stated that they cannot afford to operate or maintain the projects or implement required environmental or safety measures.” The NOI indicated that FERC would consider whether additional programmatic mechanisms should be required to ensure that licensees can afford to keep their projects in safe operating condition. While FERC currently includes a financing plan requirement in licenses hydroleadermagazine.com

HYDRO LAW

ADVERTISEMENT for new construction to ensure that the licensee has adequate funds to complete a project and then operate and maintain it, it has only in rare cases required a licensee to demonstrate the financial capacity to address future environmental concerns or potential significant dam safety issues. FERC’s NOI sought information and comment on three main possibilities for ensuring that licensees have sufficient financial resources to carry out their license requirements and maintain their projects in safe condition: (1) bonds; (2) a trust, escrow, or remediation fund, either at an industrywide level, similar to the U.S. Environmental Protection Agency’s Superfund program, or at the licensee level, similar to what is required in the nuclear industry; and (3) insurance. FERC also posed a number of other practical questions in the NOI regarding how and when financial assurance requirements should be imposed, including whether they should be included in both original licenses and at relicensing; whether they should be included in other types of authorizations, such as exemption, amendments, and transfers; and whether licenses should be reopened to include the measures. As of the date of this article, FERC has not adopted any financial assurances program in response to its NOI. It has, however, included specific provisions in several licensing orders over the past several months that reserve its authority to impose financial assurances requirements in the future. Commissioner Danly, moreover, has expressed the view that developing a financial assurances program presents difficult and challenging issues—particularly in light of the vast spectrum both of project sizes and of the identity of project owners, which include very large municipal- and investorowned utilities, independent power producers, water districts, very small corporate entities, and even individuals. FERC has signaled its intent to convene technical conferences to further inform its path forward for a financial assurances program, and licensees should plan on the possibility of this requirement becoming a license compliance obligation in the near term. UPDATE TO DAM SAFETY REGULATIONS

Following the spillway failure at Oroville, FERC convened the FERC After Action Panel (FAAP) to examine the causes of the spillway failure and identify needed improvements to the commission’s dam safety program. The FAAP’s report concluded that the dam safety issues at Oroville could be directly tied to certain design and operational deficiencies that were not detected during FERC’s standard dam safety inspection procedures set forth in title 18, part 12, of the Code of Federal Regulations. As a result, in December 2021, FERC issued a final rule amending its dam safety regulations. Among other things, the final rule implements a two-tiered inspection program, which will include a more detailed comprehensive assessment as well as a periodic inspection that will primarily focus on performance of project works between comprehensive assessments. Each type of inspection will occur at 10‑year intervals. FERC’s rule explains that this two-tiered inspection scheme is similar to those used by the Bureau of Reclamation hydroleadermagazine.com

and the U.S. Army Corps of Engineers. The final rule also changes the qualifications for independent consultants that conduct dam safety inspections, incorporates the use of teams to conduct inspections, codifies existing FERC guidance documents including on the Owners Dam Safety Program, and modifies reporting and preparedness requirements related to public safety at FERC-licensed projects. CLOSING THOUGHTS

In a January 2022 conversation with hydropower stakeholders, David Capka, the director of FERC’s Division of Dam Safety and Inspections, acknowledged the significant workload that FERC has ahead of it, which includes implementing entirely new categories of inspections and dam safety regulations while continuing to evaluate all 750 FERC-licensed hydroelectric projects for compliance with ongoing license obligations. He noted that it would likely be necessary for FERC to hire additional staff to fully implement these recent changes. This will add to a more general trend of generational turnover we have noticed at FERC in recent years— particularly as the COVID pandemic continues. In light of these significant changes—which notably include the increased occurrence of historic weather events like those that caused the Michigan dam failures—it has never been more critical for owners and operators of FERC hydropower licenses to fully understand their legal obligations and rights with respect to FERC license compliance activities. Certainly, license implementation and compliance raise highly technical issues. But the legal issues raised with license deviations and violations, accompanying civil penalties, and enforcement raise significant legal questions as well. As both FERC requirements and staff change, hydropower owners would be well advised to seek the counsel of both technical and legal advisors who can help avoid situations that otherwise could pose a significant threat to public and project safety, a licensee’s compliance record, or a project’s economic performance. H Chuck Sensiba is a partner in Troutman Pepper’s Washington, DC, office. He can be contacted at charles.sensiba@troutman.com.

Hallie Meushaw is a counsel in Troutman Pepper’s Atlanta office. She can be contacted at hallie.meushaw@troutman.com.

Elizabeth McCormick is an associate in Troutman Pepper’s Washington, DC, office. She can be contacted at elizabeth.mccormick@troutman.com.

February 2022 | HYDRO LEADER

| 35

HOBAS for HYDROPOWER Proven by Our History of Success

With installations dating back to the 1960s and over 250 penstocks worldwide, HOBAS knows Penstocks! HOBAS Pipe USA’s experienced staff will assist you from project inception through completion. The pipes offer a 100-year design life, superior abrasion resistance and great flow characteristics. Call us today to enjoy the HOBAS benefits on your project.

HOBAS PIPE USA | Home of the 100-Year Design Life Pipe | 281-821-2200

| www.hobaspipe.com

We can Assura you our software will make your life simpler.

We know Infrastructure Assets We have a very flexible solution We play nicely with others via our API We provide a return on investment The Assura solution provides efficient management of the day to day running of infrastructure making the life of managers and staff easier. Staff know the tasks and assets, what the priorities are and don't need paper to complete them. This allows them and their managers to manage by exception and the tasks that haven't been completed are escalated for attention.

“Assura has provided RWCD with the ability to meet our operational challenges in real time and the opportunity to address them in a 21st century environment.” - Shane Leonard GM, Roosevelt Water Conservation District

 hello@assurasoftware.com

(360) 601-2391

assurasoftware.com

JOB LISTINGS

Leader ydro H Does your organization have a job listing you would like to advertise in our pages? Hydro Leader provides this service to irrigation districts, water agencies, and hydropower facilities free of charge. For more information, please email Kris Polly at kris.polly@waterstrategies.com.

SENIOR DAMS ENGINEER Location: Greensboro, NC Deadline: Until Filled Salary: Based on qualifications RESPONSIBILITIES: +D evelops and maintain a group of relationship-oriented clients that provide a continuous source of work for the firm. +A ssists in negotiation of service area contracts and large engineering contracts for the firm. +W orks with business development and branch staff to effectively respond to requests for proposals or presentation of qualifications in other forums. +P erforms management duties related to obtaining signed contracts, verification of time sheets, reviewing and approving invoices, contacting clients with regard to collections of outstanding accounts and informing appropriate internal authorities regarding collections problems. +T ravel will be required. +M anage projects through investigation, design, and construction. +M anage and mentor junior engineers, commensurate with experience level. REQUIREMENTS: +B achelor’s degree focused in civil/geotechnical/structural engineering, from an ABET-accredited institution. Candidates with a Master’s Degree are preferred. + 1 0–15+ years of relevant work experience in Geotechnical, Structural Engineering or Water Resources is required. +A Professional Engineering license. +C onstruction management experience on large projects involving tunnels, dams, or other heavy civil components, with increasing level of responsibility. +A strong work ethic and the desire to perform professionally at a high level. +C andidates must have a valid driver’s license and must undergo a background check that may include criminal history, motor vehicle record and credit checks, plus a drug screen. +C OVID‑19 vaccination is a condition of employment, subject to reasonable accommodations for verified medical or religious needs that do not pose an undue hardship. For more information: go to ussdams.org.

38 | HYDRO LEADER | February 2022

WATER RESOURCES/RESTORATION PROJECT MANAGER Location: Portland, OR Deadline: Open until filled Salary: Based on qualifications RESPONSIBILITIES: +P erforming and/or leading technical analyses for river, stream, estuary, and floodplain habitat restoration; fish passage evaluation and design; water resources engineering; and/or water resources management. +P erforming hydrologic, hydraulic, and geomorphic analyses. +P reparing written reports and technical studies. +M anaging and participating in the collection of field data. +C ompleting complex analyses and calculations both independently and with oversight. +D eveloping or overseeing engineering drawings, technical specifications, and opinions of probable cost. +P reparing and reviewing design documents and specifications for restoration projects with oversight. +D eveloping or overseeing the development of construction planning and observation documentation. +M anaging the development and successful completion of projects for existing and new clients. +D eveloping scopes of work, budgets, and schedules for projects. +W orking with other senior water resources staff to identify and develop new projects and clients, prepare proposals, and capture new work. +M anaging and overseeing the professional development of junior staff. REQUIREMENTS: +A bachelor’s or master’s degree in hydraulic, water resources, or civil engineering; fluvial geomorphology; biology; or similar science with a focus in hydraulics, hydrology, habitat restoration, or fish passage. + 1 0 or more years’ experience in water resources and restoration projects, including progressive project management experience. +F amiliarity with the implementation of the hydraulic modeling, design standards, regulations, and requirements for a diversity of water resource, fish passage and restoration projects in Washington and Oregon. +A n understanding of and experience with coastal, freshwater, and estuarine systems. +G IS experience and familiarity with standard hydrologic, hydraulic, and data analysis software. +K nowledge of Washington and Oregon State’s environmental planning and regulatory environment and knowledge of fisheries biology in the Pacific Northwest. For more information: Full announcement details and application instructions are available here: anchorque.com. hydroleadermagazine.com

JOB LISTINGS

TECHNICAL SALES AND BUSINESS DEVELOPMENT Location: Northwest U.S. Deadline: Open until filled Salary: Based on qualifications RESPONSIBILITIES: +P resent NuSTREEM well by representing our product and our values accurately and enthusiastically. +M aintain existing lines of business relationships and effectively obtain new business. +B uild rapport and trust with both internal and external customers. +P rovide market feedback to help product development, marketing, and other strategies. REQUIREMENTS: +2 + years of Sales Experience in the Hydropower Industry. +S trong technical understanding of mechanical and/or electrical products. +E xcellent written and verbal skills. +C omputer literate with Sales Force, Zoho or other CRM. For more information: go to https://nustreem.com or send your resume and cover letter to HR@NuSTREEM.com.

HYDROPOWER PRINCIPAL ENGINEER Location: Boulder, CO Deadline: Open until filled Salary: Based on qualifications RESPONSIBILITIES: +W ork with management and senior staff to help refine and support the strategy and direction of hydropower research at NREL. +C ollaborate with management and senior staff to develop new DOE and external partner business funding opportunities in the area of hydropower research. +E xecute major hydropower projects and/or programs in a project leadership role. +D evelop external funding sources, including new engineering projects. +P articipate in the commercialization of results as required. +P rovide reports on technical work and input to technical publications and presentations; present work at conferences, symposia, and review meetings. +L ead engineering activities, in both DOE program and other relevant areas. + I nteract with and provide regular project reports to government and/or industrial clients.

REQUIREMENTS: +F or Researcher IV: Relevant PhD and 4–9 or more years of experience or relevant master’s degree and 7–12 or more years of experience or relevant bachelor’s degree and 9–14 or more years of experience. For Researcher V: Relevant PhD and 9 or more years of experience or relevant master’s degree and 12 or more years of experience or relevant bachelor’s degree and 14 or more years of experience. For more information: go to https://hydro.careerwebsite.com.

CONTROLLER Location: Atlanta, GA Deadline: Until Filled Salary: Based on qualifications RESPONSIBILITIES: +O versee the operations of the accounting department and manage outsourced functions. +D evelop, maintain and enforce a documented system of accounting policies and procedures. +E nsure accounts payable and payroll are paid timely and accounts receivables are collected promptly. +M aintain the chart of accounts, an orderly accounting filing system, and a system of controls over accounting transactions. + Manage cash flow to ensure adequate working capital to meet company needs. Issue timely and complete financial statements and coordinate preparation of the corporate annual report. Calculate and issue financial and operating metrics. +M anage production of annual budgets and forecasts then calculate and report variances from the budget. +P rovide financial analyses as needed related to capital investments, pricing decisions and contract negotiations. +C oordinate the provision of information to external auditors as required. +E nsure the company complies with local, state and federal government reporting requirements and tax filings. QUALIFIATIONS: +B achelor’s degree in business, finance, accounting, or equivalent business experience. +7 + years of progressively responsible corporate B2B accounting experience. +P reference will be given to candidates with Certified Public Accountant or Certified Management Accountant designations. +A bility to travel periodically. For more information: go to https://emrgy.com/career/ or contact hr@emrgy.com

FOR ADDITIONAL HYDRO-RELATED CAREER OPPORTUNITIES, VISIT: National Hydropower Association careers page: https://www.hydro.org/careers/ United States Society on Dams job listings page at: https://www.ussdams.org/resource-center/job-postings/

hydroleadermagazine.com

February 2022 | HYDRO LEADER

| 39

Leader ydro H

Upcoming Events

February 9 Nebraska Water Resources Association, Water Roundtable, Lincoln, NE February 16 Energy Storage Association, Policy Forum, Washington, DC February 23–25 Northwest Hydroelectric Association, Annual Conference, Portland, OR February 28–March 2 American Public Power Association, Legislative Rally, Washington, DC March 9 Nebraska Water Resources Association, Water Roundtable, Lincoln, NE March 9–11 Texas Water Conservation Association, Annual Convention, Fort Worth, TX March 11 Oregon Water Resources Congress, District Managers Workshop, Newport, OR March 15–16 CEATI International, 13th Annual Hydropower Conference, Palm Springs, CA March 21–23 Utah Water Users Association, Utah Water Users Workshop, St. George, UT March 25–26 American Public Power Association, Lineworkers Rodeo, Austin, TX April 5–7 National Hydropower Association, Waterpower Week, Washington, DC April 7–8 The P3 Water Summit, San Diego, CA April 11–16 United States Society on Dams, Annual Conference and Exhibition, San Diego, CA April 13 Nebraska Water Resources Association, Water Roundtable, Lincoln, NE May 2–4 National Water Resources Association, Federal Water Issues Conference, Washington, DC May 3–6 Association of California Water Agencies, Spring Conference and Exhibition, Sacramento, CA May 10–11 National Hydropower Association, Midwest Regional Meeting, St. Louis, MO May 22–25 Edison Electric Institute and American Gas Association, Spring Accounting Conference, Santa Ana Pueblo, NM

To sign up to receive Hydro Leader in electronic form, please contact us at admin@waterstrategies.com. hydroleadermag

hydro_leadr

/company/water-strategies-llc

hydro.leader

hydroleadermagazine.com