RAPID/Hydropower/Kentucky

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RAPIDRegulatory and Permitting Information Desktop Toolkit

Kentucky Hydropower Permitting Process (KY)

The steps of the Kentucky hydropower permitting process are summarized in the chart below. Roll over each section for a summary of the regulations and permits it covers. Click a section to learn more about the required permits and regulations related to that topic.

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Hydropower Development in Kentucky

In 2016, Kentucky produced 310,000 megawatt-hours (Mwh) of hydroelectric energy. U.S. Energy Information Administration – Kentucky State Profile and Energy Estimates. Currently, Kentucky has 30 hydroelectric facilities producing approximately four percent of the electricity used in the state. U.S. Energy Information Administration - Annual Electric Generator Data, Form EIA-860 Detailed Data Generator Data (Operable Units Only); U.S. Energy Information Administration – Kentucky State Energy Profile. The U.S. Department of Energy (DOE) has identified an additional 1,253 MW at 33 non-powered dams in Kentucky that could quadruple the state’s hydroelectric production. U.S Department of Energy – An Assessment of Energy Potential at Non-Powered Dams in the United States Report.

Kentucky is located within the U.S. Army Corps of Engineers’ (USACE) Great Lakes and Ohio River Division, headquartered in Cincinnati, Ohio. One of the division’s district offices is located in Louisville, Kentucky. U.S. Army Corps of Engineers – Hydropower Resource Assessment at Non-Powered USACE Sites Report. According to a 2013 USACE report, the division has 71 USACE non-powered dams with an estimated 1,962 MW of hydroelectric potential, including over 500 MW of hydroelectric potential at USACE non-powered dams in Kentucky. U.S. Army Corps of Engineers – Hydropower Resource Assessment at Non-Powered USACE Sites Report.

For Kentucky, the RAPID Toolkit only incorporates those permitting and regulatory processes most prominent to hydropower development at non-powered USACE sites, including: land access, state fish and wildlife recommendations pursuant to 10(j) of the Federal Power Act, section 401 water quality certifications and construction storm water permits under the Clean Water Act, and transportation permits.

Kentucky state agencies play a role in a number of federal permitting and review processes for hydropower development at USACE sites. The Kentucky Department of Environmental Protection (KYDEP), an agency of the Kentucky Energy and Environment Cabinet, reviews and issues section 401 Water Quality Certifications (33 U.S.C. § 1251 et seq.) In addition, section 10(j) of the Federal Power Act requires FERC to consult with state agencies responsible for the oversight and protection of fish, wildlife, and botanical resources. 16 USC 803(j); 16 USC 823a(c). The Kentucky Department of Fish & Wildlife Resources oversees the protection of fish, wildlife, and botanical resources, including developing section 10(j) recommendations. 16 USC 803(j).

In addition, Kentucky state agencies administer other permits required to develop hydropower projects at USACE dams. In order to access state lands, a state land right-of-way must be obtained from the appropriate state agency. The Kentucky Division of Real Properties keeps records of which state agencies manage public lands. The Kentucky Transportation Cabinet (KYTC) also requires a Right-of-Way Certification to encroach within, under, or over a local or state highway. KYDEP regulates construction projects that discharge storm water to ensure compliance with the National Pollutant Discharge Elimination System of the Clean Water Act (33 U.S.C. § 1342). Kentucky state agencies also work together to regulate movement on state highways and roads. KYTC regulates movement on state highways and roads by requiring Overweight and Over-Dimensional Permits for loads that exceed size and weight standards. K.R.S. § 189.270.

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Federal Regulations and Permits for Hydropower Development

The federal government, through the Bureau of Reclamation and the U.S. Army Corps of Engineers (USACE), operates 133 hydroelectric power plants—representing 8% of the country’s hydroelectric facilities. The private sector, public utilities, and state or local government operate the other 92% of U.S. hydroelectric facilities.

The Federal Energy Regulatory Commission regulates most non-federal hydropower projects. FERC has the authority to issue licenses to construct, operate, and maintain non-federal hydropower projects, pursuant to the Federal Power Act (16 U.S.C. 791 et seq.). Although developers of hydropower facilities located on non-federally owned conduits with installed capacities up to 5 MW are not required to be licensed or exempted by FERC, they must obtain an authorization from FERC to construct a Qualifying Conduit Facility. Small conduit hydroelectric facilities up to 40 MW (16 USC § 823a(b)) and small hydroelectric projects of 10 MW or less (16 USC § 2705) are eligible for an exemption from the FERC licensing process.

All developers may apply for a FERC license using the default Integrated Licensing Process (ILP) and under appropriate circumstances may apply for and receive authorization from FERC to use the Traditional Licensing Process (TLP) or the Alternative Licensing Process (ALP). The three licensing processes differ mainly in how they coordinate the applicant’s (developer’s) pre-filing activities (i.e., before filing the license application), especially the study plan development, National Environmental Policy Act (NEPA) review, and other federal and state agency processes. The goal of each licensing process is to develop a complete record of information to support FERC’s licensing decision, which must take into account protection, mitigation, and enhancement of cultural, fish, and wildlife resources.

The Federal Power Act (FPA) specifies extensive federal and state agency participation in the licensing process. When making a licensing decision, FERC considers the outcome of the consultation process mandated by Section 7 of the Endangered Species Act and project reviews required under Section 106 of the National Historic Preservation Act and the National Environmental Policy Act. The FPA requires license applications to contain a 401 Water Quality Certification. 18 CFR §4.34(b)(5). FERC also considers a number of other environmental, cultural, biological, water quality, land, geological, recreational, and aesthetic impacts of a hydropower project in making a licensing decision.

Federal agencies or Indian tribes have mandatory or optional authority to issue conditions and/or recommendations for the FERC license regarding developmental and non-developmental values and comprehensive plans to protect and mitigate damages to fish and wildlife resources:

  • Section 4(e) of the FPA authorizes federal land managers to impose mandatory conditions on a FERC license for hydropower projects located on federal reservations.
  • Section 10(a) of the FPA requires FERC to consider a project’s consistency with the federal and state comprehensive plans for improving, developing, or conserving a waterway. Whereas 4(e) conditions are mandatory, license conditions submitted under 10(a) are not mandatory, but recommendations.
  • Section 18 of the FPA authorizes the U.S. Fish and Wildlife Service and NOAA Fisheries to prescribe fishway passage requirements.
  • Sections 10(j) and 30(c) of the FPA require FERC to consult with state agencies, the U.S. Fish and Wildlife Service, and the National Oceanic Atmospheric Administration (NOAA Fisheries) who are responsible for the oversight and protection of fish, wildlife, and botanical resources. Based upon their review of the hydropower project and analysis of any study results, the agencies develop Section 10(j) recommendations for FERC-licensed projects. 16 USC 803(j). The FPA also authorizes the state and federal fish and wildlife agencies to issue mandatory terms and conditions for hydropower projects that are exempt from FERC licensing under Section 30(c). 16 USC 823a(c).

Role of other Federal Agencies

The U.S. Army Corps of Engineers (USACE), the Bureau of Reclamation (BOR), the Department of Defense (DOD), and federal land management agencies may require additional review and licensing processes for hydropower development. Under Section 404 of the Clean Water Act, USACE must authorize any discharge of dredge or fill material into waters of the U.S., including wetlands. Any proposed project that will affect navigable waters of the United States must obtain authorization from USACE under Section 10 of the Rivers and Harbors Act (33 USC 403). In addition, any proposed project that will alter or utilize a USACE structure must obtain authorization from USACE under Section 14 of the Rivers and Harbors Act (33 USC 408). All non-federal hydropower projects sited on BOR conduits and BOR dams authorized for federal power development, and not requiring a FERC license, require a BOR Lease of Power Privilege. 1992 Memorandum of Understanding between the Federal Energy Regulatory Commission and the Department of Interior, Bureau of Reclamation; (Section 9(c) of the Reclamation Project Act of 1939 (RPA, Section 9(c)) as amended by the Bureau of Reclamation Small Conduit Hydropower Development and Rural Jobs Act of 2013). All other sites (i.e., BOR dams not authorized for federal power development) require a FERC License/Exemption. In addition, before developing a hydropower project on federal land or a project that utilizes a federal resource, a right-of-way or use authorization may be required. Depending on location of the project, the relevant land management agency may be the BOR, the United States Forest Service, the DOD, the Bureau of Land Management or the National Park Service.


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