week of 4/30/03
 
 
 
  Duke relicensing talks include enhancement fund
By Don Hendershot

After three years of regular meetings, proposals, counter-proposals, trial balloons, sweat, frustration and commitment, the efforts of the Tuckasegee Cooperative Stakeholders Team are coming to a head in a rush of activities — including a recent proposal for Duke Power to create a cash endowment.

The Tuck team, created three years ago, and the Nantahala Stakeholders, formed late in 2001, will have one meeting each – May 14 for Nantahala and May 15 for Tuckasegee – and then a combined meeting on May 16.

The stakeholders groups were formed to help Duke Power develop a set of consensus recommendations for the Federal Energy Regulatory Commission (FERC) with regards to the relicensing of its Western North Carolina hydroelectric plants.

“By the end of the day, May 16, we will have a signed agreement,” said Jeff Lineberger of Duke Power.

At the Tuckasegee stakeholders last meeting April 24, David Wheeler, president of the Watershed Association of the Tuckasegee River (WATR), presented stakeholders a proposal for provisions that would be included in a Resource Enhancement Fund (REF). An REF was one of the items on Duke’s last trial balloon, submitted March 30.

Wheeler said he introduced his proposal in an effort to broaden the scale of the agreement package. He asked that stakeholders look beyond their own self-interests to issues that affect the whole watershed.

According to Wheeler, the REF has the support, in principle, of Jackson County, the towns of Sylva and Webster, the Western North Carolina Alliance and the North Carolina Wildlife Federation. Mitigation funds or mitigation banks are not new to hydropower relicensing efforts.

The Pigeon River Fund was created in 1996 with an initial $1 million contribution from Carolina Power and Light (now Progress Energy) during the relicensing of Walter’s Dam. It has provided funds for more than 90 grants across Haywood, Buncombe and Madison counties. The grants are aimed at improving water quality, enhancing fish and wildlife habitat, expanding public access and increasing the public’s awareness of water quality issues.

Wheeler’s proposal is one of three REF considerations, including one by Duke. Stakeholders will try to combine, tweak or delete considerations from all these proposals plus any other input that is available before the May 16 deadline to determine if an REF should be part of the final consensus agreement.

Agencies like U.S. Fish and Wildlife and North Carolina Wildlife Resources have official mitigation policies to follow with regards to FERC relicensing. Mitigation funds are among the last alternatives these agencies look at.

“If we get down to the end of negotiations and we have impacts that we haven’t been able to mitigate for, then we begin to consider a fund or mitigation bank,” said Mark Cantrell of Fish and Wildlife.

A copy of NCWRC’s policy lists six mitigation measures in descending order. They are: avoid the impact; minimize the impact; rectify the impact; reduce or eliminate impact over time; compensate for impacts and mitigation banking.

Steve Reed of the North Carolina Division of Water Resources, who worked on the Walter’s Dam relicensing, said there were unique circumstances that led to the creation of the Pigeon River Fund.

“At that time, the water quality in the Pigeon River was so poor, we actually didn’t want it released in the bypass,” Reed said. Reed said the revenue for the Pigeon River Fund was created by computing how much water CP&L would have to put in the bypass for mitigation purposes and calculating how much money CP&L made by using that amount of water to generate electricity.

Some of the issues Wheeler felt could be addressed by a REF include erosion caused by rapid fluctuations of water levels created by dam releases; habitat loss through land sales for development by Duke or its subsidiaries; no minimum flow to support the Bonas Defeat area of the East Fork of the Tuckasegee River; and no minimum flow to support the area below Nantahala Dam.

Lineberger encouraged stakeholders who had suggestions about the proposed REF to submit them by May 9 so they would be available for discussion at the May 15 meeting. Lineberger said he did not know if a REF would be included in Duke’s consensus agreement.

Lineberger said Duke hopes to file its license application with FERC by the end of June. The latest date is July 31, 2003. He said that Duke plans to have written and signed stakeholder agreements for the East and West forks of the Tuckasegee and Nantahala by Sept.15.

Duke will still have to go through the National Environmental Policy Act (NEPA) process with FERC. That process could take up to two years. Lineberger said the issues that Duke and the stakeholders could come to consensus on would expedite the NEPA process.

Duke’s existing licenses for its Bryson, Mission, Franklin and Dillsboro projects expire in July 2005 and its Nantahala, West Fork and East Fork projects expire in January 2006.