The House Water Resources continues its discussion-only consideration of Senate Bill 967, Yadkin River Trust, setting up a trust under which the state would assume the federal license to operate a hydro-electric plant, a license that has been held by Alcoa for the last fifty years.
Gene Ellis with Alcoa speaks in response to last week’s comments. Says bill proposes a government takeover of a private company, that they built and have maintained for 50 years. Will cost $500 million. Control of water? State already has that. Re-licensing won’t change control either.
Environmental issues? Fish advisory signs were decided by Health Dept. They were concerned about the way the study was conducted. They have long been responsible stewards. These sites pose no threats to health or environment. State already has the authority to make them do anything they think appropriate. Support? Many state agencies, lakefront property owners, local government and federal agencies support Alcoa. Ellis says this bill threatens NC’s business environment because it is a taking of private company, and will cost at least $500 M.
Sen Fletcher Hartsell, R-Cabarrus, speaks again in favor of his bill. He’s fed up with talk of a takeover. It just sets up an entity that sets up a mechanism to compete for a license. The lease is up, conditions should be reconsidered, cost estimate of $500 m is a figment of someone’s imagination. Re-captured number is $24 million, disputes other numbers. As far as he knows, no other municipality pays a utility company for the use of its water. Fish advisory issue is still in contest.
Staff member responds to concerns about the use of water resources. Richard Whisnant, UNC school of Government and author of the 2008 water allocation study, appears to try to answer water resources questions. Water law, how it’s controlled and how it’s not controlled is of particular interest. What difference would it make if it were owned by the government as opposed to a private company? Five differences: Federal interest in this river. Will be a federal license.
Operational discretion: How much? Private firm goal is to maximize return with getting every benefit from every drop of water. Government would look at flood control, water usage and withdrawals.
Adaptive management: What will the market look like in 50 years? Private and public will look at this differently.
Withdrawals: FERC staff decisions. It will make a difference if public or private.
Clean up? It would take large resources to clean up. Would private or public money be used?
Stakeholder in future discussions of what will happen in that water basin. Private and public roles would be different. Who will best protect the interests of the water basin?
Who’s at the table will make significant difference in decisions.
Hartsell thinks it is important to hear from Faison Hicks, the governor’s licensing guy, who is in charge of the litigation and filed the motion to intervene. Anticipated that this trust would be a valuable resource that belongs to the people and the GA will harness this to protect the public benefit. Wants to defeat Alcoa’s re-licensing efforts. Wants to re-capture the license and would like to have the trust ? it would be very helpful in the lawsuit to have this in place. Rep Mitch Gillespie, R-McDowell, asks about the 401 permit, what is process going forward. Governor asked in April to become a party in the re-licensing. Alcoa opposed. On May 7, DENR issued a 401 certification opening the door for Alcoa to get the new license. There are oxygen problems in the water due to Alcoa’s outdated turbines. Alcoa has not yet replaced them.
Rep Bruce Goforth, D-Buncombe, asks about costs. Beyond legal costs, he doesn’t know. He says it’s $24 m. Goforth asks how is this not eminent domain and aren’t we setting this up for Duke or Progress to do this all over the state? Hicks say this is a public asset. Doesn’t answer the question. Will we develop the land (38,000 acres) that Alcoa owns? He doesn’t know. Fletcher says the bulk of that land is not part of the deal.
Rep Hugh Blackwell, R-Burke, observes that the fiscal note says cost would be between $22.2 million and $500 million. Seems like a wide range. Fiscal research says they don’t have the resources to figure out accurate estimates. Not essential to know what the price will be but necessary to have this legislation in order to prevail in the FERC proceedings. Blackwell asks about if the state should intervene in all 401 proceedings – is this setting a precedent. He doesn’t know.
Gene Ellis, speaking to questions dealing with process, says in order for a next step, there has to be a federal takeover of the licensing, and other unique steps that would end with the feds handing the plant over to the state.
Gillespie says he wants to discuss the bill, has plans to amend it. Management of this entity will determine the policy – wants review of the policy and legislative oversight. Need to look at the revenue bonds.
At the next meeting, they will hear public comments and hope to have a vote next week. Members are asked to submit amendments as early as possible.
