Pursuant to the Small Renewable Energy Projects Act of 2009 (§10.1-1197.5 et seq. of the Code of Virginia), the Department is directed to develop one or more permits by rule “if it is determined by the Department that one or more such permits by rule are necessary for the construction and operation of small renewable energy projects.” Regulatory Advisory Panels (RAPs) comprised of stakeholders were established for each renewable source category, (i.e., wind, solar, combustion and water), to make recommendations regarding a PBR for each energy source. The Director has approved a PBR regulation for wind energy projects, solar energy projects, and combustion energy projects.
The water-related RAP made a consensus recommendation, in the fall of 2011, that it was not necessary or appropriate, under current conditions, for DEQ to develop a PBR regulation for renewable energy projects that generate electricity from falling water, wave motion, tides, or geothermal power. The RAP further recommended that DEQ re-evaluate the potential need for a PBR regulation concerning these water related renewable energy resources in 2014, or sooner if circumstances or public requests so indicate. The Director issued a decision memorandum on December 2, 2011, in which he accepted the RAP’s recommendation.
In the summer of 2014 members of the water related RAP were contacted to review the Director's 2011 decision. They were also notified of legal analysis received in March 2014 from the Federal Energy Regulatory Commission (FERC) and the Virginia Office of the Attorney General (OAG) that the federal Hydropower Regulatory Efficiency Act of 2013, codified at 16 U.S.C. 2705, did not alter federal preemption of state authority over hydroelectric projects (copy attached). The RAP members recommended by unanimous consensus that it continues to be appropriate for DEQ not to develop a water related PBR regulation and that no regulatory action should be conducted at the present time.
Opportunity for the public to comment on the RAP Recommendation for Small Renewable energy (water related) PBR regulation was announced through a Town Hall General Notice on September 18, 2014. The comment period closed on October 20, 2014. The notice provided the opportunity for the public to consider the consensus recommendation of the RAP members and explained why, at this time, it is not necessary, or appropriate, for DEQ to develop a PBR regulation for projects that generate electricity from water related renewable energy sources (i.e., falling water, tides, wave motion, geothermal power). No comments were received.
DEQ staff is not aware of any circumstances, technological developments, or other factors that have changed materially since the Director’s 2011 decision. Staff is aware of a change in federal law that occurred in 2013; however, representatives of FERC and the Virginia OAG have affirmed that these changes did not alter the fact that DEQ is preempted by federal law from regulating hydroelectric projects.
Based on the above information, November 6, 2014, the Director (1) approved the consensus-based recommendations of the water-related RAP and determined that it is not necessary for the Department to develop a PBR at the present time for small renewable energy projects that generate electricity from falling water, wave motion, tides, or geothermal power; (2) directed that chapter number 9VAC15-80 be retained on the Regulatory Town Hall in case the Department later determines that a permit by rule regulation is necessary for one or more of these renewable energy sources (falling water, wave motion, tides, or geothermal power); and directed that DEQ re-evaluate the potential need for a PBR regulation concerning these water related renewable energy resources in 2019, or sooner if circumstances or public requests so indicate.