Roger Stark Moderates Army EITF Webinar re MATOC Renewable Energy Services Agreement

On November 20, I will be moderating a webinar to preview the roll-out of the U.S. Army's latest Renewable Energy Services Agreement (RESA).

The RESA is key to implementing the Army's commitment to purchase up to $7 billion in renewable energy.  As reported on this blog, the Army has selected several companies to bid for the multi-award task order contract (“MATOC”). To implement these awards, the Army’s Energy Initiative Task Force (“EITF”) has developed the RESA to serve as the Army’s “template” document for renewable energy transactions.

The webinar will include a discussion of both goals to be achieved and challenges to be confronted by the RESA document.  Presenters will include John Lushetsky, the Executive Director of the Army's Energy Initiative Task Force (EITF); Heidi Hansen, Counsel to the EITF; and Bob Eidson, Senior Technical Advisor to the Executive Director.

Details and Registration

Army Pre-Qualifies Biomass Developers Under MATOC

On September 23, 2013, the U.S. Army Engineering & Support Center in Huntsville, Alabama, acting in conjunction with the Army Energy Initiatives Task Force, issued its final round of awards under the multi-award task order contract for renewable and alternative energy issued last summer (Solicitation Number W912DY-11-R-0036, the “MATOC”). The Army received 52 proposals in the biomass category under the MATOC and awarded thirteen (13) indefinite delivery/indefinite quantity contracts to developers in the space, four (4) of which were to small businesses. The EITF press release can be found here. Awards in the geothermal, wind, and solar categories were made earlier this year. 

As pre-qualification under the MATOC wraps up, it is important to remember that the MATOC is not the only contracting vehicle that the Department of Defense is using to construct large-scale renewable energy projects. While public attention has largely been drawn to the MATOC, the Army, Navy, and the Defense Logistics Agency (“DLA”)-Energy have been pushing forward with specific procurements and requests for information at places like Fort Huachuca in Arizona, Fort Irwin in California, Fort Detrick in Maryland, and NAWS China Lake in California. 

Army Pre-Qualifies Biomass Developers Under MATOC

On September 23, 2013, the U.S. Army Engineering & Support Center in Huntsville, Alabama, acting in conjunction with the Army Energy Initiatives Task Force, issued its final round of awards under the multi-award task order contract for renewable and alternative energy issued last summer (Solicitation Number W912DY-11-R-0036, the “MATOC”). The Army received 52 proposals in the biomass category under the MATOC and awarded thirteen (13) indefinite delivery/indefinite quantity contracts to developers in the space, four (4) of which were to small businesses. The EITF press release can be found here. Awards in the geothermal, wind, and solar categories were made earlier this year. 

As pre-qualification under the MATOC wraps up, it is important to remember that the MATOC is not the only contracting vehicle that the Department of Defense is using to construct large-scale renewable energy projects. While public attention has largely been drawn to the MATOC, the Army, Navy, and the Defense Logistics Agency (“DLA”)-Energy have been pushing forward with specific procurements and requests for information at places like Fort Huachuca in Arizona, Fort Irwin in California, Fort Detrick in Maryland, and NAWS China Lake in California. 

Army Announces MATOC Awards for Wind Developers

On September 9, 2013, the U.S. Army Engineering & Support Center in Huntsville, Alabama, acting in conjunction with the Army Energy Initiatives Task Force (“EITF”), issued the third round of awards under the multi-award task order contract for renewable and alternative energy (Solicitation Number W912DY-11-R-0036, the “MATOC”) issued last summer. The Army received 45 proposals for the wind technology segment of the MATOC, but only seventeen (17) Indefinite Delivery/Indefinite Quantity (“ID/IQ”) contracts were awarded, and only four (4) of those were awarded to small businesses (as defined in the solicitation).  While the 17 ID/IQ contracts do not authorize  the construction of any specific projects, they do give the contract recipients an exclusive right to bid on task order Requests for Proposals (“RFPs”) for wind projects that will be issued by individual installations under the MATOC.

These awards represent yet another step forward in launching  the Army’s $7 billion solicitation for privately-financed renewable energy projects. The awardees submitted proposals last October.  Since then, the EITF has been working diligently with industry participants on a standard form power purchase agreement- a form that is expected to  serve as the “standard” contract for a wide level of renewable energy procurements, including base-level RFPs. (Stoel Rives LLP attorneys, on behalf of clients and other industry stakeholders, have provided comments on an advanced version of the standard form.)   

The total number of wind-energy RFPs that will be issued under the MATOC is not known, but many in the industry expect the number to be small relative to the number of solar project proposals the Department of Defense will solicit. 

The first ID/IQ contracts were awarded to five geothermal developers on May 3, 2013, and the second round was awarded to twenty-two solar developers on August 28, 2013. No task orders for geothermal or solar projects have been issued under the MATOC umbrella to date. However, several solar RFPs and requests for statements of qualifications have been issued separately in recent months. While the Army has not announced awardees under the biomass portion of the MATOC, its press release in August stated that those awards will be announced by the end of this calendar year.

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Army Pre-Qualifies Solar Developers Under MATOC

On August 28, 2013, the U.S. Army Engineering & Support Center in Huntsville, Alabama, acting in conjunction with the Army Energy Initiatives Task Force (“EITF”), issued a second round of awards under the multi-award task order contract for renewable and alternative energy that hit the streets last summer (Solicitation Number W912DY-11-R-0036, the “MATOC”). The number of awards is somewhat surprising, however, given the Army’s early-stated desire to qualify as many applicants as possible in each technology category. In total, there were 114 proposals submitted for the solar technology segment of the MATOC, but only twenty-two (22) Indefinite Delivery/Indefinite Quantity (“ID/IQ”) contracts were issued yesterday. Thus, the Army rejected more than 80% of the applicants. Of the awards the Army did make, only six (6) were to small businesses (as defined in the solicitation). 

Col. Robert Ruch, commander of the U.S. Army Engineering & Support Center in Huntsville, stated in a press release that “[b]y pre-qualifying companies under each technology and awarding the contracts to them, we are situated to more quickly award task orders for individual future projects being developed by the Army or DOD.”  While the ID/IQ contracts do not give those 22 companies a right to construct specific projects, they do give the recipients the exclusive right to bid on forthcoming base-level task order RFPs that will be issued under the MATOC.

While the right to bid, by itself, may not seem like much, these awards represent the Army’s long-awaited next step in getting its $7 billion solicitation for independently-financed renewable energy projects off the ground.  The awardees have been waiting patiently since submitting their proposals last October, and the EITF has been working diligently with industry participants on a standard form power purchase agreement ever since- a form that we anticipate will provide the foundation for the base-level RFPs.

It is still unclear just how many task orders for solar energy projects will be issued by the Department of Defense under the MATOC, or when they will be issued.  In recent months, Fort Detrick, Fort Irwin, and Fort Bliss have come out with RFPs or requests for for statements of qualification for new solar photovoltaic projects, but none of these solicitations is taking place under the umbrella of the MATOC contract.  Each is a stand-alone RFP that was open to universal competition. Once individual installations begin issuing task orders for solar projects under the MATOC, however, the 22 awardees recognized yesterday will represent the universe of qualified bidders.

The first round of ID/IQ contracts were awarded to five potential developers of geothermal projects back on May 3, 2013.  No task orders for geothermal projects have been issued to date.  While the Army has not announced awardees under the wind and biomass portions of the MATOC, its press release yesterday stated that those awards should be made by the end of this calendar year.

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Army Seeks Feedback on Standardized Performance Work Statement for Renewable Energy Projects

On April 1, 2013, the Army Energy Initiatives Task Force (“EITF”) and the U.S. Army Mission and Installation Contracting Command at Fort Sam Houston in Texas published a template Renewable Energy Service Agreement Performance Work Statement (the “PWS”) for comment by interested stakeholders. 

The proposed scope of the PWS is broad, covering everything from insurance and OSHA requirements to interconnection responsibilities and power prices. Thus, the PWS purports to be part power purchase agreement, part EPC agreement, and part operations and maintenance agreement. As discussed in my previous entry, this comment opportunity is important to all renewable energy developers that intend to contract with the Army. However, it should be of particular interest to teams that responded to the Army’s Multi-Award Task Order Contract (“MATOC”) last fall because the final PWS will likely be incorporated into each base-level RFP issued under the MATOC.

It is important to note that the template is not a “one-size-fits-all” document and contemplates quite a bit of input from individual bases at the time RFPs are issued. Thus, the PWS is malleable and the comments the Army receives through this request for information will not result in a final form of PWS that will be incorporated into every contract issued. Rather, the Army is looking for input to create a “clear, concise and understandable” PWS template that will reduce the need for discussion and clarification of provisions common to all contracts down the line. 

For more information, attend the EITF webinar on April 11, 2013 from 1:00-2:00 p.m. EST.  see Solicitation No. W9124J13EITF1, which can be found on the FedBizOpps website. To register for the webinar, go to https://www4.gotomeeting.com/register/518667447. Registration is limited to the first 500 participants.

As was the case with the MATOC, comments and questions must be submitted via Bidder Inquiry on the ProjNet website (https://www.projnet.org). Comments must be submitted no later than 5:00 p.m. EST on May 29, 2013

Army to Seek Comments on Standardized Performance Work Statement for Renewable Energy Projects

On February 12, 2013, the U.S. Army Contracting Command announced that the Army Energy Initiatives Task Force ("EITF") is developing a standardized Utility Service Contract Performance Work Statement ("PWS") to be used for contracts executed under its long-term power procurement authority (10 U.S.C. 2922a).  The intent is to have a PWS that is clear and understandable to both the renewable energy industry and the government.  The EITF intends to publish a draft utility service contract solicitation at the end of this month-i.e., on or about March 29.  Once published, they will accept comments for 60 days.

This comment opportunity will be important to all renewable energy developers that intend to contract with the Army, but it will be especially important for teams that responded to the Army's Multi-Award Task Order Contract ("MATOC") last fall.  The comments received through this solicitation will likely be incorporated into the PWS that is included in base-level RFPs issued under the MATOC.  And interestingly, the timing lines up pretty well.  Assuming that the draft PWS is issued at the end of March (like the EITF anticipates), then comments will be due at the end of May.  Last year, the Army was saying that it would announce awardees under the MATOC at (or near) the end of Q2 2013.  If that goal becomes a reality, then the comment period on the draft PWS will close one month prior to awards under the MATOC, which would ostensibly give the Army enough time to incorporate the revised language into any base-level RFPs that would follow quickly on the heels of the MATOC awards.

For more information, see Solicitation No. W9124J13EITF1, which can be found on the FedBizOpps website.

Army Announces Forthcoming RFP for Biomass Energy

From my colleague Chad Marriott, who is attending the RETECH 2012 Conference in Washington, DC:

Today at ACORE's RETECH 2012 conference in Washington, D.C., John Lushetsky, Executive Director of the U.S. Army Energy Initiatives Task Force ("EITF") announced that the Army expects to issue a request for proposals within the next 90 days for a 15-28 MW biomass project to be located at Fort Drum in New York. The Army will be seeking a long-term power purchase agreement under the authority granted to it in 10 U.S.C. 2922a. The Army will issue the RFP through the Defense Logistics Agency-Energy.

Army Holds Pre-Proposal Conference in Huntsville on Renewable Energy Procurement

On August 22, 2012, the U.S. Army Engineering & Support Center in Huntsville, AL held a pre-proposal conference to discuss the final multi-award task order contract that was issued on August 7, 2012 (the “Final RFP” or “MATOC”).  My colleague, Lane Tucker, and I attended to hear the Army’s presentations and to engage directly with renewable energy developers, consultants, seasoned government contractors, large energy service contractors (ESCOs), and others. The conference provided attendees a great opportunity to explore the field of potential contractors and subcontractors and start (or continue) conversations about potential teaming arrangements that could result in both a MATOC award and one or more base task order awards. 

For those who could not attend, fear not; all of the presentation materials will soon be available on the Army EITF website and the Huntsville team will post all of the questions presented, along with the Army’s formal responses, to the ProjNet website. Also important is that Tonju Butler, the Procuring Contracting Officer, indicated that the deadline for questions on the Final RFP would be extended from today until September 7, 2012, so that individuals and teams can have additional time to formulate and posit questions that may be important to their proposals.  However, that change has not yet been posted to the FedBizOpps website as an amendment.  It is too early to tell whether this extension foreshadows an extension of the October 5, 2012 proposal deadline. Right now, the Army is holding firm to that date, so individuals and teams that intend to respond should plan accordingly. Keep an eye out for other amendments to the Final RFP, too. Conference attendees were assured that more would be forthcoming to clarify small technical issues and, hopefully, to flush out the structure for proposing prices. All amendments will be posted to the FedBizOpps website for the MATOC.

Here are a few takeaways and a short discussion about some important issues. Be sure to check the Q&A on the ProjNet website for any official responses from the Army on these topics. 

The Army staff that presented at the conference, including John Lushetsky, Executive Director of the EITF, and Tonju Butler, had a difficult task. Standing face-to-face with the 600+ attendees, they were asked hard questions about pricing, technology qualifications, pricing, local utility relationships, pricing, teaming and joint ventures, and (yes) pricing. Some of the questions were easily answered while others were not answered at all. To the Army’s credit, the Huntsville staff was careful not to speak out of turn- evidence that it is taking industry’s questions seriously and is willing to take the time necessary to develop thoughtful and (we hope) comprehensive responses. 

Price: The MATOC states that “the maximum unit price should be based upon the Offeror’s estimate of the total cost for development, construction, operation, and maintenance of the renewable energy production facility at a location and size that is suitable, but not ideal for the technology proposed.” These maximum unit price rates for each technology “will be evaluated to determine price reasonableness and realism.” Thus, the Army will be making an initial judgment on price even at the MATOC level, when the offeror is not bidding on a specific project.  MATOC Section L.6, Vol. V, 5 (Maximum Rates), page 96. Many attendees expressed concerns about the inflexibility of this requirement. For example, entering a single per kWh price for solar would not permit the offeror to distinguish between prices with and without incentives like the PTC and ITC, or at different installed megawatt sizes. These issues remain unanswered, but the Huntsville staff did say that “we’ve heard you on pricing” and plans to issue an amendment to the Final RFP addressing some of these concerns. One thing they also made clear is that the amendment will state that the price proposed for each technology must include the cost of financing.

Partial ownership of existing facilities: An entity is a small business under NAICS Code 221119 if it is primarily engaged in the generation, transmission, and/or distribution of electricity and the entity did not sell more than four million MWh of electricity during the last year. The Huntsville staff indicated that an entity that owns part of an existing facility (e.g., 40% ownership of an existing wind farm) must count the entire output of that facility when calculating whether the entity is over or under the four million MWh mark.

Projects currently under construction: This is an important one. Under the Corporate Technical/Management Experience requirements of the MATOC, Section L.6, Vol. I, Tab A, for technologies other than solar, offerors must describe three (3) 4MW or larger projects that the offeror had primary corporate responsibility for implementation. For solar, offerors must describe three (3) 2MW or larger projects. At the conference, the Huntsville staff clarified that for projects to qualify under this requirement they cannot be under construction at the time a proposal is submitted

Will the Navy and Air Force also use the MATOC as a primary contracting vehicle: Huntsville staff indicated that the MATOC “will be available to those sister agencies” if they want to use it.

Energy Storage: The Army will not pay more than the amount bid by an offeror at the MATOC stage for energy storage technology. However, a task order may specify a base's particular interest in “energy security.” In such a case, proposals including storage technologies could be looked favorably upon in comparison to proposals that did not. For bidders interested in integrating storage technology, a potential workaround could be to propose one price for a particular technology (e.g., solar) and a separate price (under the CLIN for “Hybrid Projects”) that includes both solar and storage.

Financing: According to Huntsville staff, the Final RFP will be amended to state that the price proposed for each technology must include the cost of financing. However, they also stated clearly that Letters of Commitment from financiers will NOT be required (although LOCs from key subcontractors are still required). In this regard, if the offeror (i.e., the legal entity with whom the Army will contract, such as the prime contractor or joint venture) cannot demonstrate its ability to procure financing, a letter of commitment must be provided from an entity that can.

Hydro:  Although I've heard commentary that hydropower was left out of the Final RFP, that's not entirely true.  The Responses to Frequently Asked Questions that the Army published along with the MATOC explicitly states that "low head/low flow water turbines and ocean energy technologies are included under the NAICS 221119."  See Question 33.  Provided dam construction is not necessary, certain hydro projects may have a place at the task order level.  There may be instances where a particular base has not determined the type of technology it wants developed on site- in which case the base may issue a request for information from developers before the task order is published.  It is important to note, however, that teams responding to the Final RFP must bid one or more of the core technologies- wind, solar, biomass, and geothermal.  Thus, any potential hydro bidder must hitch its wagon to a developer of one of those technologies if it does not develop them itself.

FAQ on Army's $7 Billion Draft RFP for Renewable Energy

On February 24, 2012, the U.S. Army Engineering & Support Center issued a draft request for proposals for renewable and alternative energy (the “Draft RFP”). Since posting our initial blog and Energy Law Alert, we have received a number of inquiries about the details of the solicitation. Below are answers to some of the most frequently asked questions.

Before we get to the questions, however, we wanted to remind everyone of the Climate Solutions event entitled “Mission Critical: Clean Energy and the U.S. Military” that will be held at 600 University Street in Seattle from 4:30 to 6:30 p.m. tomorrow. The event will be hosted by David Benson, an energy and clean tech partner in our Seattle office. We look forward to seeing you there.

Q1:      Is this the actual RFP?

            A1:      No. It is only a draft. The Draft RFP can be found here. The Army is accepting comments until March 21, 2012. Comments can be submitted via the ProjNet website here.

Q2:      When will the Army issue the final RFP and what form will it take?

            A2:      The Draft RFP does not set a date for release of the final RFP, which will take the form of a Multi-Award Task Order Contract (the “MATOC/Final RFP”). For those unfamiliar with the MATOC process, it is very important to understand four fundamental things: (1) the MATOC will not likely offer the opportunity to bid on any specific project (i.e., a “seed project”) because the Draft RFP covers multiple technologies, (2) the Army will grant multiple awards under the MATOC, (3) awards granted under the MATOC give awardees the right to bid on individual Task Order contracts issued by specific facilities for specific projects (e.g., a Task Order for a 10 MW solar PV project at Joint Base Lewis-McChord in Washington), (4) parties that are not awardees in the MATOC process may not bid on these Task Orders. Thus, a developer must be an awardee under the MATOC/Final RFP in order to have the right to bid on individual project development opportunities. Before issuing the MATOC/Final RFP, the Army will need to complete its review of all of the comments that it receives by the March 21 deadline. At some point after the MATOC/Final RFP is published, the Army will host a pre-proposal conference in Huntsville, Alabama where participants will hear presentations regarding the program, the scope of work, contractual considerations, and small-business considerations. 

Q3:      Is the Department of Defense really mandated to procure 25% of its electricity from renewable resources by 2025?

            A3:      No. Section 2852 of the National Defense Authorization Act of 2007 (Pub. L. No. 109-364) codifies the Department of Defense’s (“DoD”) voluntary goal to produce or procure 25% of its total electricity consumption from renewable energy sources by 2025. This is not a Congressional mandate; however, the DoD is taking the goal very seriously. On August 10, 2011, the office of the Assistant Secretary of the Army for Installations, Energy & Environment (“ASA IE&E”) issued an information paper announcing the formation of the Energy Initiatives Office Task Force (“EITF”). The job of the EITF would be (and now is) to serve as the central managing office for large-scale Army renewable energy projects. In that information paper, the Army estimated that an investment of up to $7.1 billion over the next 10 years would be required to procure 2.1 million megawatt-hours (“MWh”) annually to meet Army goals and federal mandates, and to provide enhanced energy security. The Draft RFP is the next step in meeting those objectives

Q4:      What quantities of generating capacity, in installed megawatts (“MW”), is the Army looking to procure through power purchase agreements (“PPA”) or equivalent contracts in each of the four categories (wind, solar, biomass, geothermal)? 

            A4:      The Draft RFP sets out specific quantities of power, in total kilowatt-hours (“kWh”) that the Army intends to procure through each of four types of contracts: (1) Solar PPA, (2) Wind PPA, (3) Biomass PPA, and (4) Geothermal PPA. The Draft RFP also states that applicants are to assume the period of performance of those contracts is 30 years. If the proposed procurement quantities are to be delivered over 30 years, and assuming a range of capacity factors for each technology type, we anticipate that the total installed MW of each to fall somewhere in the following ranges:

Technology

Proposed Procurement

(kWh)

Assumed Capacity Factor

Projected Total Installed Capacity (MW)

Solar

1,500,000,000

12-18%

31.7 - 47.6

Wind

9,000,000,000

20-40%

85.6 - 171.2

Biomass

19,000,000,000

40-50%

144.6 - 180.8

Geothermal

8,000,000,000

60-70%

43.5 - 50.7

We note that the total procurement quantity (37.5 million MWh), if delivered in equal amounts over 30 years, would yield an annual procurement of 1.25 million MWh. This number is slightly more than half of the annual procurement that the ASA IE&E, in its August 10, 2011 information paper, estimated would be required to meet the Army’s renewable energy needs.

Q5:      Is there a minimum or maximum project size?

            A5:      The Draft RFP does not specify project sizes, only the aggregate procurement quantity for each technology type. The MATOC/Final RFP, when released, will result in multiple indefinite delivery/indefinite quantity (“ID/IQ”) contracts with a portion of the awards reserved for small businesses (for details on what size projects are reserved for small businesses, see our February 28, 2012 blog or February 29, 2012 Energy Law Alert). The capacity within these ID/IQ contracts (e.g., the 1.5 million MWh capacity proposed for solar) will be shared using the fair opportunity process (a procedure under federal acquisition law) subject to a few restrictions. Specific project sizes, specific site requirements, and government-specific facility requirements will be specified by individual facilities in their Task Order requests for proposals that will be issued against the MATOC. 

Q6:      Where can a project be located?

            A6:      Projects may be located on “any federal property located within the Continental United States including Alaska, Hawaii, territories, provinces or other property under the control of the United States Government” for the period of the contract, or “on any properties available for use by the [developer] that are in the proximity of the . . . federal property” to which the electricity will be delivered. Although this response sounds like “anywhere,” individual facility Task Orders may set out specific site requirements and Government-specific facility requirements that could impact the facility’s location.

Q7:      Does the Army want to buy renewable energy facilities that developers build for it?

            A7:      No. The Army wants to enter into long-term PPAs or equivalent contracts only. Developers will be responsible for all aspects of operating and maintaining the facilities.

Q8:      Can a developer sell the energy to the Army and keep the renewable energy credits (“RECs”)?

            A8:      No. Army policy currently requires that RECs “resulting from the renewable energy generated on-site to remain with the Government.” What constitutes “on-site” is unclear, however. Projects may be located on “any federal property” or “on any properties available for use by the [developer] that are in the proximity of the . . . federal property.” Because the Draft RFP specifically states that it is the government’s intent to use the RECs to meet its renewable energy procurement target, we expect that all individual contracts will require that the government receive the RECs. However, prospective bidders may wish to seek confirmation of this point in comments submitted to the Army.

Q9:      What types of facility qualify as “biomass”?

            A9:      “[A]ll technologies that utilize organic material to generate a fuel or energy such as, but not limited to, Biomass-to-Power, Waste to Energy, Refuse Derived Fuels, bio-fuels, etc.” Due to the variability in available waste streams and the type of system required to convert the material to a usable form of energy, the technology-specific requirements will be provided in each individual Task Order request for proposals.

Q10:    Can technologies other than solar, wind, biomass, and geothermal be bid in? 

            A10:    The Draft RFP is unclear on this point.  The draft sets out specific procurement quantities only for solar, wind, biomass, and geothermal technologies.  However, Section C.4.h. defines “[a]lternative energy technologies” to mean “all other future renewable and current and future alternative technologies . . . [which] may include such items as fuel cells, ground source heat pumps, thermal recovery systems, ocean oscillation power generation systems, energy storage, batteries, micro-grids, etc.”  The draft RFP also has a very broad definition of “renewable energy,” and it explicitly contemplates the possibility that combined heat and power or “alternative fuels” may be implemented. We recommend that developers of technologies that do not fit into one of the four prescribed procurement buckets file comments with the Army by the March 21 deadline asking whether the procurement will be strictly limited to the four technologies for which it has established kWh targets.

Q11:    Could a bidder propose a cutting-edge technology?

            A11:    Probably not. The Draft RFP refers to “Commercial Technology,” which “typically means a technology in general use in the commercial marketplace in the United States at the time the Task Order RFP is issued.” The Draft RFP goes on to describe technologies “in general use” as those that have been used in three or more commercial projects in the United States in the same general application as in the proposed project, and each of those projects has been in commercial operation for at least five years. If a bidder has any doubt about whether the Army would view a given technology as commercial, the question may be a good one to raise in the bidder’s comments.

Q12:    What type of facilities is the Army targeting? Existing facilities? Greenfield development? 

            A12:    Again, the Draft RFP is unclear on this point. While the document does not explicitly prohibit bids from existing renewable energy plants, the assumption appears to be that bids will come from facilities yet to be constructed. 

Q13:    What about National Environmental Policy Act (“NEPA”) compliance?

            A13:    To reduce as much risk as possible to developers, the government intends to complete the requirements for NEPA compliance, to the extent practicable, before the issuance of a Task Order request for proposals for a particular facility. The government also intends to do the following before the issuance of a Task Order: (1) collect and share site data; (2) consult with the local utility company and utility regulatory authorities to ascertain and share constraints, procedures, and costs associated with grid interconnection; and (3) obtain necessary federal, state, and local agency approvals where possible. 

Army Corps Proposes New Nationwide Permit for Offshore Wind and Hydrokinetic Pilot Projects

The Army Corps of Engineers (the “Corps”) is seeking comments on a new proposed nationwide permit (“NWP”) for offshore wind and hydrokinetic pilot projects.  In its February 16, 2011 Proposal to Reissue and Modify Nationwide Permits, the Corps described a new NWP for “Water-Based Renewable Energy Pilot Projects” that could give developers a reprieve from obtaining permits under § 10 of the Rivers and Harbors Act and § 404 of the Clean Water Act for the “construction, expansion, or modification of water-based wind or hydrokinetic pilot projects and their attendant features.”  

Under the new NWP, "attendant features" may include transmission lines, roads, land-based distribution facilities, parking lots, and stormwater management facilities.

The new NWP would authorize wind and hydrokinetic pilot projects with no more than 10 individual generation units (e.g., turbines, buoys) that do not cause the loss of greater than 1/2 acre of waters of the United States, including the loss of no more than 300 linear feet of stream bed. However, the NWP would not authorize activities on coral reefs and no structure could be placed in (1) established danger zones or restricted areas, (2) shipping safety fairways or traffic separation schemes established by the U.S. Coast Guard, or (3) open water dredged material disposal areas designated by the Corps or the Environmental Protection Agency.  Permitees under the new NWP would be required to notify the Corps’ district engineer as early as possible prior to construction.

 

It is important to note that the general conditions for all nationwide permits would apply to the new NWP, including Condition 25. Because the new NWP has not previously received a state coastal zone management consistency concurrence, Condition 25 would require that one be obtained or a presumption of concurrence must occur. The requirement for a consistency determination under Section 307(c)(1) of the Coastal Zone Management Act permits coastal states to propose additional conditions on the new NWP that would apply to development in that state. Although all of the western coastal states and Maine have signed memoranda of understanding with the Federal Energy Regulatory Commission to advance hydrokinetic energy projects, and many east coast states like New Jersey have taken steps to incentivize the development of offshore wind, the states will have an opportunity to change how the new NWP is implemented once adopted.

 

Comments on the new NWP are due no later than April 18, 2011.

Department of Energy, Department of the Interior, and Army Corps of Engineers Sign Memorandum of Understanding for Hydropower

On March 24, 2010, three federal agencies announced a Memorandum of Understanding for Hydropower (the “MOU”) that impacts developers of traditional hydropower, hydrokinetic, pumped storage, and small-scale hydropower facilities. The Department of Energy (“DOE”), the Department of the Interior (“DOI”), and the Department of the Army, through the U.S. Army Corps of Engineers (“USACE”) (collectively, the “Agencies”), signed the MOU to "meet the Nation’s needs for reliable, affordable, and environmentally sustainable hydropower by building a long-term working relationship, prioritizing similar goals, and aligning ongoing and future renewable energy development efforts" between the agencies. The MOU comes at a time when industry representatives and eleven U.S. Senators are requesting that DOE support a $200 million appropriations request for the advancement of both conventional and advanced waterpower technologies.

 In this “new approach to hydropower,” the Agencies intend to focus their collective efforts on advancing sustainable, low-impact, and small hydropower projects and promoting the goal of energy efficiency through water conservation or improved water management. Operating under the MOU, the Agencies will work together to advance four primary objectives:

  • Support the maintenance and sustainable optimization of existing Federal and non-Federal hydropower projects;
  • Elevate the goal of increased hydropower generation as a priority of each Agency to the extent permitted by their respective statutory authorities;
  •  Promote energy efficiency; and 
  • Ensure that new hydropower generation is implemented in a sustainable manner.

For more information on the MOU, including potential next steps for the Agencies, read the Energy Law Alert by Stoel Rives attorneys Cherise Oram, Michael O'Connell, and Chad Marriott posted here.

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