Most discussions of increasing electrical supply involve building a new plant, using new technology, or building a new line. Much less attention is given to the impact of projects that are allowed to go idle due to expiring permit requirements. In fact, it appears that regulatory timing and not technical ambitions will ultimately determine whether additional hydroelectric generating capacity will be available soon.
When regulatory issues are the major cause of delayed construction
There are dozens of hydroelectric project approvals throughout the U.S. that have sat idle since they were approved many years ago. Because of pandemic-related problems with material delivery, supply chain interruptions, and financial issues, many of the above-mentioned projects have exceeded the federal time frame in which construction was required to occur. At that point, it was no longer likely that a delay would occur; instead, cancellation became possible.
The U.S. Congress has intervened
The U.S. House of Representatives recently voted in favor of the passage of H.R. S. 1020, otherwise known as the “build more hydro” act. This act provides the Federal Energy Regulatory Commission (FERC) with the authority to grant extended construction deadlines to roughly 36 hydroelectric projects whose construction deadlines have lapsed. Although the Senate has already passed the bill, it still needs to be signed by President Trump.
Unlike previous bills, this one focuses on keeping previously reviewed, licensed, and mostly designed projects alive rather than revising environmental regulations or quickly processing approval for new locations.
This is more than just procedural posturing
At stake here is more than just procedural posturing. approximately 2.6 GW of reliable baseload hydroelectric generating capacity, along with an estimated $6.5 billion of private sector investment, is represented by the projects impacted by the legislation.
In practical terms, much of this generating capacity comes from improving the output of existing facilities through replacing turbines, upgrading generators, etc., rather than developing new dams.
A grid under increasing stress
As the nation’s electric grid faces increased demand from widespread electrification and the use of data-intensive industries, preserving these projects will add firm power around the clock to the nation’s grid without requiring that the grid start from scratch.
Why offer extensions in this form?
The original purpose of hydroelectric project licensing deadlines was to keep project developers moving forward in a timely manner. However, during the last few years, a series of external events caused significant delays, making the timeliness provisions unworkable. Absent congressional intervention, most developers would have to restart multi-year permitting processes, thereby discouraging future investments.
According to the National Hydropower Association, the Build More Hydro Act remedies a procedural disconnect between regulatory expectations and real-world circumstances. By providing FERC the ability to allow for extensions of construction deadlines for authorized permitted projects, the act allows completed projects to remain viable while retaining all current oversight and environmental protection mechanisms. Additionally, this approach creates no new entitlements. Instead, it acknowledges that extraordinary delays necessitate administrative flexibility to avoid losing already-approved energy capacity by default.
Treating infrastructure upgrades as capacity additions
The bill represents another paradigm shift in how policymakers see grid growth. Rather than focusing primarily on green field development, there is an increasingly growing recognition of the potential for maximum utilization of existing resources. For example, for hydropower, this entails viewing infrastructure upgrades as additions to the system’s total installed capacity. Many of these upgrades are typically located close to other existing transmission and load center facilities, which enables them to deliver reliability benefits sooner than a totally new generation. Additionally, they provide long-lived resource options that can complement variable renewable generation without the requirement for new lands or extensive storage resources.
The underlying message is subtle yet significant: regulatory consistency can be as effective as technological advancements. By providing authorization for FERC to extend construction timelines for delayed hydroelectric generating projects, the U.S. regulatory environment is converting previously stranded generating capability into functional grid resources.
