[Federal Register Volume 61, Number 20 (Tuesday, January 30, 1996)]
[Proposed Rules]
[Pages 2969-2971]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-1723]



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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration

15 CFR Part 981

[Docket No. 951213299-5299-01]
RIN 0648-AI42


Ocean Thermal Energy Conversion Licensing Program

AGENCY: Office of Ocean and Coastal Resource Management (OCRM), 
National Ocean Service (NOS), National Oceanic and Atmospheric 
Administration (NOAA), Department of Commerce (DOC).

ACTION: Proposed rule.

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SUMMARY: The National Oceanic and Atmospheric Administration (NOAA) is 
proposing to remove Part 981 from Title 15 of the Code of Federal 
Regulations (Part 981). Part 981 implements the Ocean Thermal Energy 
Conversion (OTEC) Licensing Program, which was established under the 
Ocean Thermal Energy Conversion Act of 1980, as amended, (OTEC Act), 42 
U.S.C. 9101 et seq. No applications under Part 981 for licenses of 
commercial OTEC facilities or plantships have yet been received by 
NOAA, and there has been a low level of NOAA activity under the OTEC 
Act. During this 15 year period of time, the availability and 
relatively low price of fossil fuels, coupled with the risks to 
potential investors, has limited the interest in the commercial 
development of OTEC projects. Removal of Part 981 at this time will 
allow NOAA to evaluate the appropriateness of these, or any other, 
regulations at such time as interest in the commercial development of 
OTEC projects occurs.

DATES: Comments on the proposed rule are invited and will be considered 
if submitted in writing to the address below on or before February 29, 
1996.

ADDRESSES: Comments should be submitted to Karl Jugel, Chief, Ocean 
Minerals and Energy Division, Office of Ocean and Coastal Resource 
Management, National Ocean Service, National Oceanic and Atmospheric 
Administration, 1305 East-West Highway, 11th Floor, Silver Spring, MD 
20910.

FOR FURTHER INFORMATION CONTACT:
James Lawless, Deputy Director, Office of Ocean and Coastal Resource 
Management, at (301) 713-3155.

SUPPLEMENTARY INFORMATION:

I. Regulatory Review

    The National Oceanic and Atmospheric Administration (NOAA) is 
proposing to remove Part 981 of 15 CFR, pursuant to the Regulatory 
Reform Initiative of President Clinton and the Ocean Thermal Energy 
Conversion Act of 1980, as amended.
    In March 1995, President Clinton issued a directive to federal 
agencies regarding their responsibilities under his Regulatory Reform 
Initiative. This initiative is part of the National Performance Review 
and calls for immediate, comprehensive regulatory reform. The President 
directed all agencies to undertake, as part of this initiative, an 
exhaustive review of all their regulations--with an emphasis on 
eliminating or modifying those that are obsolete or otherwise in need 
of reform.
    The Ocean Thermal Energy Conversion Act of 1980, as amended, (OTEC 
Act), 42 U.S.C. Secs. 9101 et seq., also requires that NOAA 
periodically review the regulations that apply to the licensing of OTEC 
facilities and 

[[Page 2970]]
plantships. The fundamental purpose of the review is to determine if 
the regulations themselves impose an adverse impact on the development 
and commercialization of OTEC technology.
    Comments are solicited from all interested persons on the proposed 
removal of Part 981. Comments are in particular invited on whether the 
OTEC regulations, or their removal at this time, impose an adverse 
impact on the development and commercialization of OTEC technology.

II. Ocean Thermal Energy Conversion Licensing Program

    The principle behind Ocean Thermal Energy Conversion (OTEC) has 
been validated through experimental projects in the United States and 
elsewhere. However, many design and economic uncertainties remain with 
regard to a commercial scale plant.
    The OTEC Act established a licensing and permitting system for the 
development of OTEC as a commercial energy technology. Without a legal 
framework, including the site security and predictability it provides, 
financing and insuring commercial OTEC operations may have been 
impossible. The OTEC Act applies to facilities located in U.S. 
territorial waters or connected to the United States by pipeline or 
cable. The law also applies to all OTEC plantships owned or operated by 
U.S. citizens and all OTEC facilities or plantships documented under 
U.S. law. The OTEC Act requires that a person obtain a license from 
NOAA in order to own, construct, or operate such a facility or 
plantship. The OTEC Act and the implementing regulations provide the 
framework for the development of a commercial OTEC industry.
    Section 102(a) of the OTEC Act required NOAA to complete issuance 
of final implementing regulations by August 3, 1981. Section 102(a) 
also established certain criteria that the regulations must satisfy. 
NOAA is authorized, consistent with the purposes and provisions of the 
OTEC Act, to amend or rescind the OTEC regulations. In particular, 
section 117 of the OTEC Act requires NOAA to review the regulations on 
a periodic basis NOAA is authorized and directed to revise the 
regulations as necessary and appropriate to ensure that the regulations 
do not impede the development, evolution, and commercialization of OTEC 
technology.
    After receiving comments from an advance notice of proposed 
rulemaking (45 FR 77038, November 21, 1980), NOAA proposed to issue 
minimal OTEC regulations upon considering three other approaches: (1) 
detailed regulation of OTEC activities, (2) moderate regulation of OTEC 
activities, and (3) no regulations. Under the ``minimum regulation'' 
approach proposed by NOAA on March 30, 1981 (46 FR 19418-19447), the 
OTEC licensing regulations would include only the general guidelines 
and performance standards specified in the OTEC Act. Detailed 
guidelines and specifications would not be provided in advance in the 
regulations. They would be introduced if deemed necessary on a site-
specific, case-by-case basis to prevent significant adverse effects on 
the environment or to prevent other results contrary to law. The 
information submitted to NOAA with an application would include details 
of the proposed site, descriptions of the operating features of the 
plan, and assessments of the potential impacts of construction and 
operation. Thus, application for a license could be made before 
detailed design of the OTEC project was completed. NOAA would examine 
the applicant's assessments of the nature and potential magnitude of 
the impacts from construction and operation of the proposed project, 
and analyze in detail only those impacts that appeared to pose 
significant problems.
    Under this approach, the incremental administrative costs to NOAA 
to process each application would be relatively modest. Maximum 
flexibility would be afforded OTEC project sponsors.
    Most persons who commented on the proposed OTEC licensing 
regulations favored the ``minimum regulation'' approach as the approach 
which would best permit the innovation and flexibility necessary in the 
early years of implementation of a new technology. See Final Regulatory 
Impact Analysis and Final Regulatory Flexibility Analysis for 
Regulations to Implement Public Law 96-320, The Ocean Thermal Energy 
Conversion Act of 1980, July 1981, U.S. Dept. of Commerce, NOAA, Office 
of Ocean Minerals and Energy. NOAA's detailed analysis of potential 
regulatory impacts of various licensing regimes, prepared as part of 
the regulation development process, confirmed that the minimum 
regulation approach was the most cost-effective one that would satisfy 
the goals of the OTEC Act. Accordingly, it was adopted as the basis for 
the final licensing regulations issued by NOAA. NOAA published final 
regulations implementing the OTEC Act in the Federal Register on July 
31, 1981 (46 FR 39388-39420). The licensing process developed by NOAA 
and specified in the final regulations was intended to provide the 
orderly, timely, and efficient review of OTEC proposals envisioned by 
the drafters of the OTEC Act.
    In 1983 and 1984, NOAA undertook two reviews of the OTEC license 
procedures. Beginning with a notice in the Federal Register on May 11, 
1983 (48 FR 21154-21156), NOAA reviewed the OTEC regulations to 
determine if the regulations themselves imposed an adverse impact on 
the development and commercialization of OTEC technology. A second 
review of the regulations was conducted by NOAA at the request of the 
Office of Management and Budget in accordance with the Paperwork 
Reduction Act. Also in 1984, Congress passed amendments to the OTEC 
Act. On November 21, 1985, NOAA published a proposed rule (50 FR 48097-
48099) incorporating the 1984 amendments to the OTEC Act. This proposed 
rule reflected NOAA's conclusion, as a result of its regulatory review, 
that no additional regulatory modifications were necessary. A final 
rule was published in the Federal Register on June 10, 1986 (51 FR 
20958-20960).
    Also in 1985, NOAA published a Guide to Permits and Regulations 
Applicable to Ocean Thermal Energy Conversion Projects--Hawaii Edition. 
This permit guide was prepared in order to provide OTEC project 
sponsors with an overview of potential licenses, permits and 
authorizations required by federal, state and local agencies. It was 
intended as a reference guide for federal, state and local agencies 
processing OTEC permit applications.
    No applications for licenses of commercial OTEC facilities or 
plantships have yet been received by NOAA, and there has been a low 
level of NOAA activity under the OTEC Act. Since FY 86, no 
appropriations have been requested by the present or past 
Administrations, or provided by the Congress, for NOAA OTEC activities. 
NOAA's last significant OTEC related activities were limited to the 
completion of two research studies in FY 87, both of which had been 
funded and initiated with previous appropriations. One was the impact 
of OTEC generated underwater sound on selected marine animals, and the 
second study was on the socioeconomic effects of an OTEC plant at Kahe 
Point, Oahu, Hawaii. Since that time, NOAA activities have been limited 
to responding to occasional requests for OTEC related technical and 
regulatory information. The overall availability and relatively low 
price of fossil fuels, coupled with the risks to potential investors, 
has limited the interest in the commercial development of OTEC 
projects.

[[Page 2971]]

    Given that a commercial OTEC industry has yet to develop, Part 981 
remains unused for the most part. Removal of Part 981 at this time is 
consistent with the purposes and provisions of the OTEC Act in that it 
will allow NOAA to evaluate the suitability of these regulations at 
such time as interest in the commercial development of OTEC projects 
occurs. At such time, NOAA will issue a proposed rule appropriate to 
the then current regulatory needs. Potential licensees will therefore 
be assured that any future OTEC regulations will be up to date, and 
will continue to provide innovation and flexibility necessary for an 
emerging OTEC industry.
    NOAA is mindful of its responsibility for licensing of commercial 
OTEC facilities and plantships under the OTEC Act, however, and will 
take appropriate steps to review and process an application should one 
be made. For particular inquiries into the licensing of OTEC projects 
in the interim period, NOAA will provide copies of the provisions of 
these OTEC regulations in response to such inquiries. Thus, NOAA will 
provide actual and timely notice of applicable procedures and 
requirements to particular individuals. See 5 U.S.C. Sec. 552(a). 
Accordingly, NOAA is proposing to remove Part 981, the OTEC 
regulations, from Title 15 of the CFR.

III. Miscellaneous Rulemaking Requirements

Executive Order 12612: Federalism Assessment

    NOAA has concluded that this regulatory action does not have 
federalism implications sufficient to warrant the preparation of a 
Federalism Assessment under Executive Order 12612.

Executive Order 12866: Regulatory Impact

    This proposed rule has been determined to be not significant for 
purposes of Executive Order 12866.

Regulatory Flexibility Act

    No licenses have been issued for OTEC projects under 15 CFR Part 
981. When commercial interest in OTEC projects occurs, NOAA will issue 
a proposed rule appropriate to the regulatory needs at that time. For 
particular inquiries into the licensing of OTEC projects in the interim 
period, NOAA will provide actual and timely notice of applicable 
procedures and requirements to particular individuals. See 5 U.S.C. 
Sec. 552(a). For these reasons, the proposed removal of Part 981 is not 
expected to have a significant economic impact on a substantial number 
of small entities, and the Assistant General Counsel for legislation 
and Regulation of the Department of Commerce has so certified to the 
Chief Counsel for Advocacy of the Small Business Administration. As 
such, an initial Regulatory Flexibility Analysis was not prepared.

Paperwork Reduction Act

    This rule does not contain an information collection requirement 
subject to review and approval by OMB under the Paperwork Reduction Act 
of 1980, 44 U.S.C. 3500 et seq.

National Environmental Policy Act

    NOAA has concluded that this regulatory action does not constitute 
a major federal action significantly affecting the quality of the human 
environment. No applications for licenses of commercial OTEC facilities 
or plantships have yet been received by NOAA, and Part 981 remains 
unused for the most part. When commercial interest in OTEC projects 
occurs, NOAA will issue a proposed rule appropriate to the regulatory 
needs at that time. For particular inquiries into the licensing of OTEC 
projects in the interim period, NOAA will provide actual and timely 
notice of applicable procedures to particular individuals. See 5 U.S.C. 
552(a). Therefore, an environmental impact statement is not required.

    Authority: Ocean Thermal Energy Conversion Act of 1980, as 
amended, 42 U.S.C. 9101 et seq.

List of Subjects in 15 CFR Part 981

    Administrative practice and procedure, Ocean thermal energy 
conversion licensing, Environmental protection, Marine resources, 
Penalties, Reporting and recordkeeping requirements.

    Dated: January 24, 1996.
W. Stanley Wilson,
Assistant Administrator for Ocean Services and Coastal Zone Management.

    Accordingly, for the reasons set forth above, Chapter IX of Title 
15 of the Code of Federal Regulations is proposed to be amended as 
follows:

PART 981--OCEAN THERMAL ENERGY CONVERSION LICENSING PROGRAM--
[REMOVED]

    1. Under the authority of the Ocean Thermal Energy Conversion Act 
of 1980, Part 981 is removed.

[FR Doc. 96-1723 Filed 1-29-96; 8:45 am]
BILLING CODE 3510-22-M