The Federal Energy Regulatory Commission proposed Thursday to change when it assesses annual charges to hydropower operators that are not state and municipal entities.

Under FERC’s Notice of Proposed Rulemaking, the charges would start two years from the effective date of a project license, exemption or amendment authorizing new capacity — not when construction on a project commences (RM15-18).

The revisions would eliminate the need for licensees and exemptees to notify FERC of construction starts in order to invoke the fees. FERC also no longer would have to contact the entities to elicit the information. FERC said the change would provide certainty as to when the charges would go into effect and improve administrative efficiency.

The fees apply to projects exceeding 1.5 MW of installed capacity. Original licenses, relicenses, exemptions and amendments adding new capacity generally require that construction start within two years of the date of issuance. The changes would mean that charges will be assessed regardless of when the projects commence or whether or not FERC has granted an extension.

FERC predicts that an average of 5.2 licensees and/or exemptees annually will end up paying annual charges before the start of construction. On average, 10.6 entities are expected to be affected by the rule change.

— Suzanne Herel