OREC Annual Report 2009

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					2009 Annual Report
    on the Marine
Renewables Industry
in the United States:
  A comprehensive review of legislation,
regulations, executive policies and financial
                 incentives



Prepared by the Ocean Renewable Energy Coalition
Principal Author: Carolyn Elefant, Counsel to OREC
Contributing Author: Sean O’Neill, OREC President
             www.oceanrenewable.com


                February 17, 2010
2009 OREC Annual Report                                                                                       ©OREC 2010



Table of Contents
A Message from Sean O’Neill and the Ocean Renewable Energy Coalition Team............. 5
EXECUTIVE SUMMARY ................................................................................................... 7
PART I: FUNDING, APPROPRIATIONS AND TAX CREDITS & INCENTIVES .................. 8
   A. American Recovery and Reinvestment Act (ARRA) of 2009 and other Stimulus
   Legislation ................................................................................................................... 8
        1.      Background to the stimulus packages ............................................................... 8
        2. Energy and Improvement Extension Act of 2008 ................................................. 9
        3.      American Recovery and Investment Act of 2009 .............................................. 9
             Tax Credits................................................................................................. 9
             Buy American Clause ............................................................................... 10
             Federal Loan Guarantees ......................................................................... 10
        4.  Evaluation of the Impact of ARRA on Marine Renewables: A Few Steps
        Forward, But Not Far Enough ................................................................................. 10
        5.      Future ARRA Activity ..................................................................................... 11
   B.        Appropriations Legislation ................................................................................. 12
        1.      Appropriations: FY09, FY10 and Upcoming FY11 .......................................... 12
        2.      Earmarks ........................................................................................................ 12
   C.        Tax Legislation ................................................................................................... 13
   D.        Department of Energy Funding Programs ........................................................... 15
        1.      Awards for Water Power Research ................................................................. 15
        2.      Funding of Energy Frontier Research Centers ................................................. 16
   E.        Navy Funded Programs ...................................................................................... 16
        Key Federal Navy Energy Mandates ........................................................................ 16
PART II: LEGISLATIVE ACTIVITY.................................................................................. 17
   A. Energy Bill ............................................................................................................ 17
        1.      Marine Energy Promotion Act of 2009 ........................................................... 17
        2.      Senate Energy Bill .......................................................................................... 18
   B.        NOAA Bill ......................................................................................................... 18
   C.        House Science and Technology Committee ........................................................ 19
PART III: Department of Energy Activities .................................................................... 20
   A.        Department of Energy/NREL Activities............................................................... 20



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2009 OREC Annual Report                                                                                      ©OREC 2010

       1.        Creation of Test Center Database................................................................... 20
       2.        DOE Funding Priorities .................................................................................. 21
       3.        DOE/NREL Road mapping Activities .............................................................. 21
PART IV: PROJECT DEVELOPMENT AND REGULATORY ............................................. 22
  A. Regulatory Developments ..................................................................................... 22
       1. MMS Regulation Issuance: ................................................................................. 23
            a.        MMS-FERC MOU – Prelude to MMS Regulations ............................ 23
            b.        MMS Regulations for Leases on OCS............................................... 24
            c.        Subsequent MMS Issuances............................................................. 25
       2.        FERC-State MOUs .......................................................................................... 27
            a. Oregon............................................................................................... 27
            b.  Washington..................................................................................... 28
            c.  Maine.............................................................................................. 28
       3.        FERC Transmission MOU ............................................................................... 29
  B.        Project Development Status ............................................................................... 29
       1.        Ocean Power Technologies ............................................................................ 30
       2.        Verdant Power ............................................................................................... 30
       3.        Snohomish County PUD................................................................................. 31
       4.        Ocean Renewable Power Company................................................................ 32
       5.        HydroGreen................................................................................................... 33
       6.        PG&E Wave Connect ..................................................................................... 33
       7.        Free Flow Power ............................................................................................ 34
       8.        Wavebob ....................................................................................................... 34
  B.        Assessment of the Existing Regulatory Process..................................................... 34
       1.   Some regulatory uncertainty with respect to applicable license process has
       been eliminated...................................................................................................... 34
       2.  The existing licensing process is lengthy and delays deployment of
       demonstration projects........................................................................................... 35
       3.        The existing licensing process is costly. .......................................................... 35
       4.    The licensing process is not coordinated and places a substantial burden on
       license applicants. .................................................................................................. 36
       5.   There is a dis-connect between regulation and other policies designed to
       stimulate renewable growth. .................................................................................. 37
  C.        Other FERC Policy: Transmission for Renewables.............................................. 37



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2009 OREC Annual Report                                                                                     ©OREC 2010

PART V: ADMINISTRATION AND OCEANS TASK FORCE/COASTAL AND MARINE
SPATIAL PLANNING ..................................................................................................... 38
   A.        Executive Leadership.......................................................................................... 38
   B.        Interagency Ocean Policy Task Force................................................................. 39
        1.        Task Force Interim Policy............................................................................. 39
        2.      Coastal and Marine Spatial Planning .............................................................. 40
             a. Definition of CMSP ............................................................................ 40
             b.   Proposed Implementation of CMSP................................................. 41
             c. Implementation of the Plan ................................................................. 42
             d.   OREC’s View of CMSP .................................................................... 42
   C. Executive Order on Federal Leadership in Environmental, Energy and Economic
   Performance ............................................................................................................. 43
PART VI:             INTERNATIONAL ACTIVITIES ................................................................. 44
   A.        TC114 SEAN ...................................................................................................... 45
   B.        International Energy Agency Activities ............................................................... 45
PART VIII: OTHER OREC ACTIVITIES........................................................................... 47
IX.     THE OUTLOOK FOR 2010.................................................................................... 48




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