Federal regulators have issued a pilot project license to a tidal energy project proposed in Maine's Cobscook Bay. Yesterday, the Federal Energy Regulatory Commission issued an order granting Ocean Renewable Power Company Maine, LLC an 8-year pilot project license to construct, operate, and maintain its proposed Cobscook Bay Tidal Energy Project. As licensed, the 300 kilowatt project will be located in Cobscook Bay north and east of Seaward Neck and west of Shackford Head State Park in Eastport, Maine.
ORPC Maine applied for its pilot license in September 2011. Last month, FERC issued its Environmental Assessment of the Cobscook project, finding generally that licensing the hydrokinetic project with
appropriate environmental protective measures would not constitute a
major federal action that would significantly affect the quality of the
FERC granted the pilot project license just 179 days after the license application was filed, a relatively quick timeline for hydropower permitting made possible by FERC's hydrokinetic pilot project licensing process. As envisioned by FERC staff, the ideal pilot project should be (1) small, (2) short term, (3) located in non-sensitive areas based on the Commission’s review of the record, (4) removable and able to be shut down on short notice, (5) removed, with the site restored, before the end of the license term (unless a new license is granted), and (6) initiated by a draft application in a form sufficient to support environmental analysis. In ORPC Maine's case, FERC staff agreed that the Cobscook project was a good fit for pilot project licensing process after reviewing the developer's application.
FERC's order approving the license includes an analysis of the economic benefits of project power. As licensed, FERC found that the levelized annual cost of operating the project would be about $1,419,600, or $1.13/kWh. Based on an estimated average generation of 1,250,000 kWh as licensed, the annual value of alternative grid-based power would be $90,400, or 7.2 cents/kWh. Therefore, in the first year of operation the project power would cost $1,329,200, or $1.06/kWh, more than the cost of alternative power.
As FERC found, "The project has relatively high capital and operation and maintenance costs with respect to the amount of power produced. Although our analysis shows that the project as licensed herein would cost more to operate than our estimated cost of alternative power, it is the applicant who must decide whether to accept this license and any financial risk that entails. This project’s value, however, lies in its successful testing and demonstration of ORPC Maine’s turbine technology, and the project’s ability to raise the profile of, and advance, the emergent tidal energy industry."