On Thursday, U.S. Department of Interior Secretary Salazar and Federal Energy Regulatory Commission (FERC) Chairman Wellinghoff signed an agreement to spur renewable energy development on the U.S. Outer Continental Shelf (OCS) - i.e., ocean waters up to 200 miles from shore, exclusive of the nearest 3 miles (or in some states, 9 miles) from shore, which are considered state waters.

At first blush, this Memorandum of Understanding, (MOU), seems to provide clarity for the respective roles of these regulatory bodies on the OCS. Essentially, the Department of Interior's Minerals Management Service (MMS) will have jurisdiction over offshore wind projects.  FERC will have oversight of projects designed to generate electricity from waves, tides, and ocean currents (hydrokinetic).  

But the MOU also reserves for MMS the role of issuing leases, easements, and rights-of-way for hydrokinetic projects, and provides that FERC will not authorize any project that has not first obtained such authorization from MMS.  This statement of shared authority - while resolving, in large part, a long-simmering dispute between the agencies that has hindered development of offshore renewables - prompts some additional questions and reactions concerning the rules for developing hydrokinetic energy:

1. Further clarity is needed with respect to understanding which issues and policies each agency is responsible for.  For example, which issues are considered in MMS's leasing decision-making process?  And how does this differ from the review FERC will conduct as part of the licensing process?
2. Similarly, it is not clear whether the two agencies' reviews will be concurrent, or whether FERC will defer consideration of applications until MMS has made its decision.  And, if the reviews are concurrent, how will they be coordinated?
3. Under the MOU, hydrokinetic projects on the OCS will not be allowed within National Marine Sanctuaries, National Monuments, the National Park System, or the National Wildlife Refuge System, because the Outer Continental Shelf Lands Act (OCSLA) prohibits MMS from authorizing renewable energy projects in such areas.  But OCSLA does not apply in state waters, where hydrokinetic projects are subject to FERC jurisdiction under the Federal Power Act (FPA).  Will FERC apply the FPA to provide equivalent protections in state waters?  (FPA regulations do not exclude, for example, National Marine Sanctuaries, many of which are located in state waters.)
4. Will MMS consider lease requests anywhere on the OCS on a case-by-case basis, or does it intend to identify in advance, and make available for leasing, those areas where renewable energy development is most likely to be compatible with the protection of marine ecosystems? While it is encouraging that section E requires participating agencies to coordinate to "ensure that hydrokinetic projects meet the public interest, including the adequate protection, mitigation, and enhancement of fish, wildlife, and marine resources and other beneficial public uses," the threshold for doing so remains vague, at best. It will be necessary to define in much greater detail the "adequate protection, mitigation and enhancement of fish, wildlife, and marine resources and other beneficial public uses," to enable all stakeholders and citizens to vet projects that hold promise for our nation with respect to renewable energy but, if not sited, designed, and operated properly, may compromise our oceans' natural resources that we hold in public trust.  Moreover, since the Department of Interior and FERC are the only parties to the MOU, it remains to be seen what role will be afforded to the National Oceanic and Atmospheric Administration (NOAA), the nation's premier oceans stewardship agency, which possesses the most relevant knowledge and expertise concerning protection of our marine ecosystems.
5. Section C provides that FERC will not issue "preliminary permits" for hydrokinetic projects located on the OCS (which grant a permit-holder priority to apply for a license in a given area). What will come of the many preliminary permits that FERC has already granted (with little or no prior environmental review)?
6. Section III addresses the handling of hybrid (wind/hydrokinetic) projects and projects that straddle the boundaries between state waters and the OCS very lightly. An agreement "to work together to the extent practicable to develop policies and regulations" for such projects is, again, encouraging, but does not set forth the specific guidance that industry or environmental advocates seek in furthering their efforts to promote sustainable renewable energy in an environmentally sensitive way.

On the whole, it is encouraging to see coordination and cooperation by two of the main federal agencies with authority over our offshore renewable energy future. However, practically speaking, a lot remains to be seen with respect to how these efforts will be carried out.

In fairness, this is only a MOU. However, our energy demands are real and present. While there is much reason to be encouraged by this endeavor, more clarity is needed. In the spirit of change and new leadership; one can only hope that the execution of this MOU matches the great intention set forth in this shared effort.