UNITED STATES OF AMERICA
before the
FEDERAL ENERGY REGULATORY COMMISSION


In re: SAPPI projects
Saccarappa Falls: FERC Project No. 2897
Gambo Falls: FERC Project No. 2931
Mallison Falls : FERC Project No. 2932
Little Falls: FERC Project No. 2941
Dundee Falls: FERC Project No. 2942


MOTION OF MAINE COUNCIL ATLANTIC SALMON FEDERATION FOR ENVIRONMENTAL IMPACT STATEMENT AND CUMULATIVE IMPACTS ANALYSIS; MOTION FOR LICENSE DENIAL; MOTION FOR EVIDENTIARY HEARING.


Pursuant to Rule 212 of FERC's Rules of Practice (§385.212), intervenor Maine Council of the Atlantic Salmon Federation hereby moves to request the Commission prepare an environmental impact statement and cumulative impacts analysis for the above projects pursant to §380 of Commission regulations, those of the Council on Environmental Quality, 40 CFR parts 1500 through 1508 (1986) and NEPA, 42 U.S.C. 4321-4370a; to deny license for Projects 2932, 2941 and 2942 as being inconsistent with §10(a) and §4(e) of the Federal Power Act; and to conduct an evidentiary hearing to resolve disputed issues of fact relevant to these motions and this proceeding. Below we provide the following facts and statement of law in support of these motions and to refute licensee's claims in opposition to these motions.

A. THE COMMISSION SHOULD DIRECT STAFF TO PREPARE A CUMULATIVE IMPACTS ANALYSIS OF THE PROJECTS.

A cumulative impacts analysis is necessary because the five projects lie consecutively on the Presumpscot River and collectively impound more than half of its length as well as portions of several major tributaries (Colley Wright Brook, Pleasant River, Little River). Because of their configuration, the projects have almost completely impounded this section of the Presumpscot River and eliminated its free-flowing habitat and ability to support self-sustaining populations of its indigenous fish species. This alteration of the Presumpscot River prevents the public from enjoying the recreational and economic benefits of the Presumpscot's native, indigenous fish populations in their native, riverine habitat, including lake, riverine and sea-run varieties of the Atlantic salmon and native brook trout. These projects, by barring access and altering habitat for salmon and American eel, impact fisheries resources far beyond their project boundaries and in fact impact much of the 580 square mile Presumpscot watershed, including Sebago Lake, Crooked River and the numerous lakes and ponds which feed them.
A recent comment by Maine Dept. of Inland Fisheries & Wildlife regional fisheries biologist John Boland to the Portland Press-Herald confirms our claim that the cumulative impact of these projects has greatly impaired the salmonid fishery of the Presumpscot River. The story reads, "Boland ... said his agency stocks the Presumpscot regularly but has not been able to develop a good fishery near the dams. But he said if steps could be taken to improve conditions and increase water flows, the Presumpscot could rebound. 'The river has the potential to be a very good fishery,' he said." (Portland Press-Herald, 6/22/99; Appendix 1). Boland's assessment reconfirms that made by his predecessor, regional fisheries biologist Stuart E. DeRoche, who noted in the 1970s: " ... Flowages created by the dams between Sebago Lake and Westbrook have inundated most of the fast water areas that once provided habitat for cold-water game fish. Less than 15 percent of the main river from Sebago Lake to Westbrook now contains the habitat that trout and salmon require from spawning and nursery areas. This loss of fast-water habitat, along with high summer water temperatures, fluctuating water levels, and competition from warm-water game fish precludes cold-water fishery management in the main Presumpscot River." (from Maine Rivers, Selected Articles from Maine Fish and Wildlife magazine, Thorndike Press, Thorndike, Maine, 1979, pp. 47-49)(Appendix 2).
We also note that on the lower Androscoggin, Kennebec and lower Penobscot Rivers and West Branch Penobscot Rivers, FERC consolidated and analyzed the cumulative impact of re-licensing multiple dams on these rivers with coincident license expiration dates through the Kennebec Basin EIS and lower Penobscot EIS. Because these five Presumpscot projects have coincident license expiration dates, are geographically consecutive and their operation directly and cumulatively impacts more than half of the Presumpscot River and portions of its tributaries, Maine Council ASF believes a similar approach is warranted in this proceeding.
In support of this request and our request that an Environmental Impact Statement to be prepared for this proceeding, we submit evidence of strong angler interest in a free-flowing rather than an impounded Presumpscot River resulting from the existence and operation of licensee's projects. This has been quantitatively demonstrated at the 1.25 mile- long river reach immediately below the outlet of Sebago Lake, which had year-round flows restored to it by Commission order in 1992 (58 FERC ¶ 62,006). Through this order, FERC overruled the objections of the licensee to this proceeding and recognized and affirmed the significant non-power benefits of restoring native, indigenous salmonid fisheries to this reach through a guaranteed, year-round flow to the river's natural channel.
Since year-round flows have been restored to this river section, Maine Dept. of Inland Fisheries & Wildlife angler surveys have documented substantial angler use of the reach, increasing from 2,811 angler trips 1993 to 6,826 trips in 1995 (SAPPI, ICD for Eel Weir, FERC Project No. 2984, p. 59). Angler use and interest is also high in the free-flowing reaches of the Pleasant River in Windham, a major tributary of the Presumpscot which holds wild and holdover hatchery-reared salmonids, as evidenced by frequent and substantial coverage of the Pleasant River's salmonid fishery in publications such as the Maine Sportsman, particularly an August 1999 column which focusses exclusively on fishing opportunities in the free-flowing areas of the Presumpscot and Pleasant River, not mentioning the impoundments at all (Appendix 3). These examples confirm a clear desire and preference among anglers for riverine salmonid fishing opportunities in the Presumpscot River drainage as opposed to impoundment fisheries. We note that the five projects in the re-licensing, as proposed by the licensee, will provide virtually no opportunity for angling in a free-flowing riverine setting. Maine Council ASF believes the creation of additional free-flowing reaches of the Presumpscot River through modification or removal of several of the projects in this re-licensing proceeding (as proposed by Friends of the Presumpscot) would generate comparable or greater angler interest and use of the river as the examples cited above; and far greater angler interest than the project impoundments. Restoration of self-sustaining populations of the river's indigenous species, especially wild sea-run and landlocked Atlantic salmon, would generate even greater angler interest in part due to the paucity of this type of angling opportunity in southern and central Maine and the proximity of the Presumpscot River to Maine's most populous cities and towns. Maine Council ASF notes that riverine angling opportunities for wild landlocked Atlantic salmon are almost non-existent in the United States except for Maine and within Maine they are largely confined to northern and extreme eastern Maine in the upper Penobscot, St. Croix and Fish River drainages, all more than 150 miles north of the Presumpscot River, one of only four native homes of landlocked salmon in Maine. Today, the only riverine angling opportunity for wild landlocked Atlantic salmon in southern or central Maine is found in a tributary of the Presumpscot River watershed, the Crooked River, which unlike the Presumpscot is almost completely undammed and fully accessible to the wild landlocked salmon population of Sebago Lake. The provision of up and downstream access and habitat restoration on the Presumpscot River would restore the Presumpscot's native riverine salmon fishery and create a sea-run Atlantic salmon fishery and the southernmost recreational fishery for wild landlocked Atlantic salmon in the United States.
We note the Commission in 1992 reached a similar conclusion based on similar facts in its order for minimum flows in the Eel Weir bypass reach, finding over licensee's persistent objections: "The licensee also argues that fishing opportunities in the project vicinity are adequate and improving the fishery is not necessary. The DIFW management plan targets the Presumpscot River for riverine landlocked salmon fishing. This anglingopportunity is not a readily available resource, and if established, would represent one of only two such fisheries in southern Maine. The other landlocked salmon stream is southern Miane is the Crooked River, the principal salmon spawning tributary for Sebago Lake. The DIFW desires a reduction in fishing pressure on the Crooked River in order to maximize natural reproduction in the lake ... Landlocked salmon are a highly sought-after game fish and their availability in southern Maine is limited, especially in streams. Southern Maine is the most densely populated portion of the state and is relatively close to population centers of New Hampshire and Massachusetts, as well. It seems clear that the fishery envisioned by the DIFW would be heavily utilized." (58 FERC ¶ 62,006)(Appendix 4).
Based on the information presented above, Maine Council ASF requests that commission staff conduct an analysis of the cumulative impact of these projects on the Presumpscot River's ability to support its indigenous (ie. native) fish species; an analysis of the lost economic and recreational benefits incurred from the absence of self-sustaining populations of these indigenous species resulting from the cumulative impact of these projects; and an analysis of the economic benefits of restoring these species and their natural habitat to the project areas. Maine Council ASF requests that FERC staff analyze the cumulative public benefits of the power produced by these dams over the term of any license proffered by the Commission and the cumulative impact to the public in terms of power and non-power uses if any or all of the projects were decommissioned or re-licensed. Such an analysis should consider the public need for power created at these dams in light of active proposals to construct two very large (500 megawatt) natural gas power plants near the Presumpscot River in Gorham and Westbrook; the reduction in localized electricity usage resulting by the July, 1999 closing of the pulp-making facilities at the licensee's Westbrook paper making mill; and the reduction in localized electricity demand created by the expansion of natural gas service for heating and other purposes with the completion of several natural gas distribution lines to the area.

B. AN ENVIRONMENTAL IMPACT STATEMENT IS REQUIRED AT THESE PROJECTS.

Under NEPA an EIS is required for "major federal actions significantly affecting the quality of the human environment" (42 U.S.C. §4332(2)(C)). "Significant" is further defined in the Council on Environmental Quality's regulations 40 C.F.R. §1508. Each of the following consequences of the projects requires the Commission to prepare an EIS: violation of water quality standards (40 C.F.R. §1508.27(b)(2); impacts on recreation; impacts on fish and fish habitats; the controversial nature of the proposal (40 C.F.R. §1508.27(b)(9); cumulative impacts. The controversial nature of the projects is amply demonstrated in fact by the motions of two intervenors for license denial at three of the projects and related local press coverage and editorial support for such an action (Appendix 5). The violation of Maine water quality standards is contained in 38 MRSA §464 ¶11-A, which requires project impoundments to meet Class C standards including providing habitat for fish and other aquatic life. Impoundments now cannot and do not support self-sustaining populations of the river's primary indigenous fish species, Atlantic salmon and brook trout.
As stated in our motion for intervention, the five projects in this proceeding lie in the most populous county of Maine (Cumberland) and directly adjacent or within Maine's largest city, Portland, its heavily populated and growing suburbs, and the regionally important recreational region surrounding Sebago Lake, the Presumpscot's primary headwater lake. By virtue of geography alone these projects significantly impact the natural and cultural environment inhabited by a large portion of Maine's population and merit NEPA analysis rather than the smaller scope of an Environmental Assessment.
A NEPA analysis of these five projects is warranted because they directly impact and alter more than half of the Presumpscot River and portions of its tributaries and in regards to Atlantic salmon and American eel, impact much of the 580 square mile Presumpscot River watershed, since historic evidence indicates these species freely travelled through the project areas to waters many miles upstream, including Sebago Lake and the Crooked River. In recent re-licensing proceedings in Maine, the Commission has initiated a basin-wide EIS process as opposed to an EA on the Kennebec River and the lower Penobscot and Androscoggin Rivers for multiple projects with coincident license expiration dates on the same river. In these proceedings, the Commission correctly recognized that the cumulative impact of these projects on their respective rivers and high level of interest among citizens and citizens groups and myriad social and environmental issues warranted the higher degree of investigation and scrutiny an EIS provides. Only three years ago on the Presumpscot River watershed, the Commission developed a draft EIS in 1996 and issued a final EIS in 1997 (as opposed to an EA) solely to address concerns and complaints regarding the impact of licensee's operations at one small dam, the 1.8 megawatt Eel Weir Dam (FERC No. 2984), on lake levels at the Presumpscot's primary headwater, Sebago Lake (79 FERC ¶ 61,064). In this case, the Commission ruled an EIS was warranted (as opposed to an EA) even though the issue involved only one small output project; the project's license expiration date was nearly a decade away; and a license had been issued to the project only 12 years earlier (26 FERC ¶ 61,241).
An EIS rather than an EA is warranted in this proceeding because of the high level of interest among citizens and citizen organizations (to date four citizen groups have intervened, all desiring restoration of the river's native fish species); proposals made by intervenors calling for dramatic changes in project operation, including project decommissioning; and recent opportunities for substantial restoration of the Presumpscot's native fisheries from the impending breaching of its head-of-tide Smelt Hill Dam which will provide anadromous species access to the river to within one mile of the lowermost dam in this proceeding.
These projects merit NEPA analysis because of the unique status of the Presumpscot River as the outlet of the second largest (and the deepest) natural lake in Maine and the lake's significance as the type habitat and one of only four native homes of lake dwelling Atlantic salmon (Salmo salar sebago) in Maine. The significance of the Presumpscot as a home for Atlantic salmon was noted by Goode in 1887 who wrote:

"The Presumpscot drains about 520 square miles of territory, and among its tributaries are lakes with an aggregate area of 90 square miles. Lake Sebago, the second lake in the State in size, lies but 22 miles from the sea, but has an elevation of 247 feet. The Presumpscot is therefore a rapid river. It has remarkable clear water, and abounded naturally in gravelly rapids. It was frequented by salmon, shad, alewives, but seems to have been best adapted to salmon. All fisheries were practically extinguished early in the present century by a dam at the headof the tide. That dam was afterwards abandoned, and alewives have since found a limited breeding ground, and though unable to ascend the river far, both shad and salmon have occasionally been found in it in recent years. All the dams now on the river, some seven in number, have been recently provided with fishways, through which alewives do, and salmon may, ascend to Lake Sebago." (George Browne Goode, The Fisheries and Fishery Industries of the United States, Government Printing Office, Washington, 1887.)

The Presumpscot's statewide significance for harboring Atlantic salmon was noted by Kendall (1935): "Presumpscot River -- This was once one of the finest salmon rivers for its size in the state of Maine, but was early obstructed by dams and only a few salmon have since been taken. Salmon were reported at Cumberland Mills and Sacarappa, in 1873." (Appendix 6)
The Presumpscot and its inlet lake, Sebago, are also of special significance because the lake was known historically to produce very large lake dwelling salmon, much larger than those found in the fishes' other native homes in the state; and because the upper Presumpscot River was a primary spawning ground for Sebago's salmon until they were denied access to it by dams without fishways (Kendall, 1935). The world rod and reel angling record for landlocked salmon was established at Sebago in 1907 (22.5 pounds); on the same day the record salmon was caught, author William Converse Kendall caught a 16 pound salmon from Sebago Lake (Warner & Havey, 1970). Kendall (1935) identified the Presumpscot as a primary spawning and nursery ground for Sebago's salmon until fishways at the outlet dam (now owned by licensee) fell into disrepair and later, when licensee diverted the river's entire flow into a canal and dewatered its natural riverbed: "In the Presumpscot River, which is the outlet of Sebago Lake, the Sebago salmon used to breed and in the spring of the year, large well-conditioned salmon were found in the stream. Later they disappeared. Prior to the erection of the dam at the head of the river, and later while the fishway was effective, most, if not all, of the salmon returned to the lake."
Today, Sebago's attraction to anglers remains centered on its historic and deserved reputation as one of the premier landlocked salmon waters in the United States and one of only four native waters of the species in the State of Maine. A recent map and brochure created by the Portland Water District emphasizes the primacy of the species to the lake: "Did you know 28 species of fish call Sebago Lake home? There's lake trout, brook trout, smallmouth bass, largemouth bass and cusk, just to name a few. But the star of the show is the landlocked salmon, a species native to Sebago and three other Maine lakes (West Grand, Green and Sebec)." (emphasis added)
In 1989, the State of Maine included Sebago in its list of "Outstanding Lakes in the Organized Territories" and stated, "Sebago Lake is one of the largest and most significant and heavily used lakes in the entire state. It has outstanding cultural, shoreline, and fishery features ..." (Maine's Finest Lakes, The Results of the Maine Lakes Study, Maine State Planning Office, 1989).
The continued desire by anglers for wild, rather than hatchery-reared landlocked salmon in Sebago is demonstrated in an article in the July 1999 edition of the Maine Sportsman magazine (Appendix 7). As demonstrated by this article, Sebago anglers continue to place a high value on wild salmon as opposed to hatchery-reared salmon. What is politely omitted from many of the above citations is that historical evidence indicates the Presumpscot River was a primary spawning and nursery area for Sebago's lake-dwelling salmon as long as they had access to it; and that Sebago's salmon have been barred from their historic spawning and nursery habitat in the upper Presumpscot for nearly a century as a direct result of licensee's dams.
As noted in our motion for intervention, licensee's five projects impound more than half the length of the Presumpscot River, the largest river in Maine's most populous county, and impound historic spawning and nursery habitat for one of only four aboriginal landlocked salmon populations in the state. As such, the outcome of this proceeding stands to greatly impact and potentially limit the future public uses and benefits of more than half of the Presumpscot River, several of its major tributaries as well as its headwater lake. These projects are now "significantly affecting the human environment" by fully impounding 12 miles of the Presumpscot River and preventing certain uses, particularly recreational fisheries for native, wild salmonids, commercial and recreational fisheries for migratory fish and recreational whitewater and fastwater boating.
Because the consideration of re-licensing these projects is a federal action, this re-licensing meets the test of a "major" federal action in terms of its impact on the future public uses and benefits of the Presumpscot River, which is a significant component of the human environment for all Maine residents and particularly those who live in the communities near the Presumpscot River.
In conclusion, the outcome of this re-licensing and that of the licensee's Eel Weir Project will determine if the Presumpscot River will once again become free-flowing over much of its length and capable of supporting wild riverine and sea-run Atlantic salmon and other native species; or if more than half of the Presumpscot River will remain a sterile deadwater utterly incapable of supporting its most charismatic and desireable native fish species. The outcome of this proceeding will determine the fate of this river and its native species long after the participants in this proceeding and the citizens who live next to this river are dead. As such, Maine Council ASF believes the evidence cited above supports the conclusion that this proceeding is indeed a "significant federal action affecting the human environment" and merits full NEPA analysis by the Commission.

MCASF MOVES FOR LICENSE DENIAL AT LITTLE FALLS, MALLISON FALLS AND SACCARAPPA FALLS PROJECTS:

Of the five projects in this relicensing, Maine Council ASF supports denial of new license for only three: Saccarappa, Mallison Falls and Little Falls. These projects are the lowermost of the five and are consecutive on the Presumpscot River. Under our proposal, with the impending removal of the river's head-of-tide Smelt Hill Dam and excepting the very small impoundment created by licensee's Cumberland Mills dam (FERC license surrendered 6/24/1986), nearly three fourths of the Presumpscot River will be restored to its historic, free-flowing riverine habitat and accessible to all of the of the river's resident and migratory fish species.

LICENSEE FAILS TO QUANTIFY ITS CLAIM OF HARM FROM FPR AND MCASF's RECOMMENDED ACTION

Licensee owns and operates six hydro-electric dams on the Presumpscot River: Saccarappa (1.35 MW), Little Falls (1 MW), Mallison Falls (800 KW), Gambo (1.9 MW), Dundee (2.4 MW) and Eel Weir (1.8 MW). In total, these projects have a capacity of 9.25 MW. The projects we propose for decommissioning have a combined nameplate capacity of 3.15 MW. These projects represent one third of licensee's existing hydroelectric capacity on the Presumpscot River and approximately one fourth of the total installed hydroelectric capacity on the Presumpscot River (including FPL Group's North Gorham Project).
Based on licensee's claim in its July 19, 1999 response to Friends of the Presumpscot River (FPR) that its hydroprojects "may" represent "as much as" 25 percent of its mill's energy requirements, we calculate the share provided exclusively by the Saccarappa, Mallison Falls and Little Falls projects combined provide approximately 8.5 percent licensee's mill's energy requirements. Since licensee characterized its 25 percent figure as an upper boundary estimate ("may represent as much as"), the 8.5 percent portion we calculate as provided by the projects proposed for decommissioning is also an upper boundary estimate. The real contribution of these projects may be lower than 8.5 percent of the licensee's mill's energy requirements depending on actual annual output of the projects and actual rather than licensee's estimated mill energy requirements.
The primary detriment claimed by the licensee from license denial is a predicted increased need for power from sources outside its hydroelectric projects. However, licensee fails to quantify the specific impact decommissioning these three projects would have on its mill's energy needs; nor has it provided the Commission with a quantitative analysis of the cost of the power its three projects produce compared to the cost of replacement power from other sources. Given licensee's claim in its June, 1999 response to the Commission's AIR of April 15, 1999 that enhancements and relicensing costs will result in a 50 percent increase in the cost of power generated by its projects, a detailed analysis of this cost differential is critical to this proceeding, especially in light of licensee's claim that it needs the projects because "low-cost hydro power assists S.D. Warren in competing in the highly competitive paper markets." (licensee's response to FPR at Appendix I-1).
Licensee fails to note that decommissioning will relieve it of the substantial annual cost of operating, maintaining and repairing these projects; and that decommission would relieve it of the significant financial cost of its proposed project enhancements. According to licensee's June, 1999 response to the Commission's AIR of April 15, 1999, its proposed enhancements for the three projects we propose for license denial will cost $336,630 in capital expenditures and $59,738 in annual operating expenditures. Licensee claims these costs will increase generating costs at these dams by 25 percent. When combined with licensee's estimated cost of re-licensing the projects, licensee estimates a total 49 percent increase in generating costs at all five projects. Licensee states the proposed enhancements and relicensing costs at all five of its projects will result in an operating loss of $238,000 per year as compared to an annual operating income of $196,000 if licensee invested the same funds in alternative capital projects. Licensee's own estimates of the cost of relicensing and enhancements stand in sharp contrast to its claim the projects are important because they provide "low-cost hydro power."
Evidence in the record suggests licensee's estimated costs of project mitigation and enhancements are most likely minimal estimates and these estimates may be much higher. Licensee's estimate presumes that its proposed four-week, four hour per night downstream eel protection measures will be sufficient to meet agency objectives for the species. However, agency officials suggest the Presumpscot may have a much longer eel migration season, perhaps as long as 12 weeks (Gail Wippelhauser, Maine DMR, personal communication). Since the agencies and licensee's downstream eel protection measures consist of turbine shutdowns, the economic impact of such measures could greatly increase over licensee's present estimates if a longer period of fall shutdowns are required to safely pass the river's adult silver eel population. If so, the increase in generating costs at the projects would be even higher than the 49 percent licensee currently estimates.
Lastly we note that since the licensee's mill consumes all of the power produced by the projects we propose for license denial, their decommissioning would have no impact on residential, municipal or other industrial energy consumers in the area since the power produced by these projects is not available to them.

LICENSEE FAILS TO SUBSTANTIATE ITS CLAIM THAT RELICENSING ALL FIVE PROJECTS COMPLIES WITH CONTROLLING LAW:

Licensee's 7/19 response to FPR asks the Commission to "summarily dismiss" FPR's motion for license denial because FPR fails to provide sufficient evidence to support its claim a free-flowing Presumpscot River is "important" to FPR. Simultaneously, licensee asks the Commission to relicense all five projects simply on the basis that they are "important" to the licensee.
The proper context for a discussion of the licensee's, FPR's and our recommended actions in this proceeding are the legal parameters within which the Commission must render a finding, including Sections 10(a) and 4(e) and 313(b) of the Federal Power Act. In its July 19 response to FPR, licensee fails to provide substantial evidence showing its recommended action (relicensing of all five dams as currently operated) comports with the statutory standards set out in the FPA, including Sections 10(a) and 4(e). The language of Section 10(a) clearly indicates the Commission must make an affirmative finding in order to satisfy the requirements of the section (emphasis added): "That the project adopted ... shall be such as in the judgment of the Commission will be best adapted to a comprehensive scheme for improving and developing a waterway or waterways ..." Clearly, a Commission finding for re-licensing must state why and how a project comports with Section 10(a) and why and how other recommended actions, including license denial, do not comport with the standard. In its pleadings to date, licensee fails to provide the Commission with evidence sufficient to make such a finding.

Controlling Law Requires FERC to Conduct Its Relicensing Inquiry As If the Projects Were Newly Proposed for the River

Licensee's apparent claim of a presumptive entitlement to new licenses for all five of its projects simply because it wants new licenses is not supported by controlling law.
The Commission's organic statutory authority requires that relicensing be a reexamination of the original license (See Confederated Tribes and Bands of theYakima Nation v. FERC, 734 F.2d 1347, 1352 (9th Cir. 1984). The court in Confederated Tribes rejected the notion that relicensing is nothing more than a continuation of the status quo: "the decision to relicense is to be based on the same inquiry as the original licensing, including a consideration of all relevant harms and benefits to public uses of the project." (Id. at 1358) The court explained that:

"[r]elicensing is substantially the equivalent to issuing a new license .... Simply because the same resource had been committed in the past does not make relicensing a phase in a continuing activity. Relicensing involves a new commitment of the resource."

Congress has endorsed the above view of relicensing, explaining that, in a relicensing proceeding, "licenses in past years must be reexamined and justified ... in light of today's standards and concerns." [H.R. Rept. 507, 99th Cong., 2d Sess. 33 (1986); Conference Report, H.R. Rept. 934, 99th Cong., 2d Sess. 22 (1986) ("projects licensed years earlier must undergo the scrutiny of today's values and provided in ... environmental laws applicable to such projects."); 133 Cong. Rec. S-4147 (daily ed. April 11, 1986) (Sen. Evans) ("We ought to have the opportunity to take another look [at the time relicensing] to see if the current use for [the] water resource for hydroelectric energy is still the highest priority and best use of that water."]

In accordance with the court's opinion in Confederated Tribes, an analysis of the projects proposed by the licensee for this relicensing must view them as new commitments of the resource, ie. as if the projects were newly proposed by the licensee and have yet to be constructed. To satisfy the court' s standard, the Commission must examine and weigh the benefits of the river resource with the project against the benefits the river resource would provide (including its historic, indigenous fisheries, wildlife and recreation resources) without the project. Such an approach is also required by Section 10(a) of the Federal Power Act which requires the Commission to affirmatively find and substantiate that a project re-licensing is "best adapted to a comprehensive scheme for improving or developing a waterway or waterways ..." Section 10(a) implies in corollary that if the Commission cannot affirmatively find and substantiate a specific project is "best adapted to a comprehensive scheme ..." the Commission cannot proffer a license. The language cited above also implies by necessity that Congress contemplated instances where some projects, no matter how conditioned, would not be "best adapted to a comprehensive scheme" and thus require a license denial pursuant to this section. We note that the Section 10(a) makes no distinction between projects that are newly proposed or projects proposed for re-license. Thus, as supported by the court's opinion in Confederated Tribes, as affirmed by the testimony of Congress as cited above; as evidenced in the express language of Section 10(a), the Federal Power Act gives no special deference or status to projects proposed for re-licensing as opposed to projects newly proposed; nor does it relieve applicants seeking re-license of the same evidentiary burden required of those seeking license denial.

LICENSEE'S PROJECTS HAVE NEVER BEEN FOUND TO COMPLY WITH THE FEDERAL POWER ACT AS AMENDED; LICENSEE FAILS TO AFFIRMATIVELY DEMONSTRATE THEY DO SO:

All of the projects in this proceeding were constructed and issued original licenses prior to Congress' amending of the Federal Power Act in 1986 to revise and expand Section 10(a), 4(e) and other sections. Neither the Commission or the licensee have ever produced substantial evidence to support an affirmative finding that the projects are "best adapted to a comprehensive scheme ...." as required by Section 10(a); nor have they been found to be in compliance with other sections of the Federal Power Act revised or amended since projects' original licenses were issued. Whether these five projects (with any set of conditions) comply with the Federal Power Act as amended is a question of first impression before the Commission. As such, the Commission should place upon the licensee an evidentiary burden commensurate with this fact to demonstrate these projects comply with the law as amended in 1986.

The amended Section 10(a) of the Federal Power Act clearly places the burden upon licensee and Commission to affirmatively demonstrate license issuance is in compliance with the requirements of the section:

"That the project adopted ... shall be such as in the judgment of the Commission will be best adapted to a comprehensive scheme for improving and developing a waterway or waterways for the use and benefit of interstate commerce, for the improvement and utilization of water power development, for the adequate protection, mitigation, and enhancement of fish and wildlife (including related spawning grounds and habitat), and for other beneficial public uses, including irrigation, flood control, water supply, and recreational and other purposes referred to in section 4 (e) ..."

Commission rules (52 Fed. Reg. 39,905 [1987]) require a licensee or other party to buttress a recommended action (ie. project relicensing) with substantial evidence to support that action:

"the weight to be according any information or recommended action, whether or not it is contained in a comprehensive plan, depends on the documentation which supports it, since the Commission's findings must be based on substantial evidence pursuant to Section 313(b) of the Federal Power Act." (emphasis added)

By virtue of its application for re-license, licensee recommends a specific action to the Commission: that it affirmatively find that all five of licensee's projects as proposed "are best adapted to a comprehensive scheme for improving or developing a waterway or waterways ..." In recommending such an action to the Commission, licensee is obligated to forward substantial evidence to the Commission sufficient to allow the to to make an affirmative finding based on substantial evidence, pursuant to Section 313(b).
In its response to FPR, licensee makes the following claims: that its projects generate a discrete amount of electrical power; that its mill uses all of the power these projects provide and that its mill would need to replace this power if any or all of its projects in this proceeding were not re-licensed. (Licensee's Response at Appendix I-1). While we do not dispute any of these claims, in and of themselves they are wholly inadequate as an evidentiary basis for the Commission to make an affirmative finding that licensee's recommended action (re-licensing all of its projects as proposed) meets the standards of Section 10(a); or that such claims provide the Commission with the "substantial evidence" it must have as the basis to make such a finding, pursuant to Commission Rule (52 Fed. Reg. 39,905 [1987]) and Section 313(b) of the Federal Power Act.
In its response to FPR, licensee informs the Commission it should support licensee's recommended action (that all five of its projects should be re-licensed as proposed) and dismiss FPR's motion because, "Low-cost hydro power assists S.D. Warren in competing in highly competitive paper markets." Licensee provides nor cites the requisite economic data to substantiate this broad and vaguely stated claim. Nor does it buttress this claim with a quantitative comparison of the cost of power produced at its dams over the term of the licenses it seeks and the cost of power it already procures from other sources; nor does licensee provide any substantive evidence to quantify the specific economic impact it claims FPR's motion for denial would have on its "competitiveness." Absent such economic data and analysis, licensee's claim to a vague and unquantified impact on its competitiveness resulting from FPR's motion is mere speculation and should be treated and disregarded as such by the Commission. Maine Council ASF requests the Commission take notice that licensee's claim states only that low-power "assists ... in competing in highly competitive paper markets." Licensee makes no claim that its mill depends or relies upon low-cost hydropower or more specifically, the power produced by the dams we propose for license denial. Instead, licensee asserts only that "low-cost hydro power assists" it in competing against other manufacturers of similar products. In this instance, we note there are myriad things which might "assist" the licensee to be competitive, including relief from all types of legally mandated societal, fiduciary and environmental obligations, yet such obligations are not waived solely on the basis that doing so would "assist" a private industry to "compete" with its competitors.
As outlined above, licensee's own estimates of its cost of operating the projects as proposed cast serious doubt upon whether they will in fact "assist" the licensee's desire for competitiveness at a level high enough to override the massive damage they cause to 12 miles of a once free-flowing Presumpscot River. Until a more definitive analysis is presented, the data presented by licensee thus far suggests the projects provide little assistance at all and may in fact detract from licensee's competitiveness. Licensee's affirmative claim for recommending re-licensing of all of its dams (and thus opposing and seeking dismissal of FPR's motion for license denial) is very simple: decommissioning the Saccarappa, Little Falls and Mallison Falls projects could potentially increase licensee's energy costs which may have a potential impact on licensee's competitiveness. This reason, which lacks any supporting quantifying evidence, fails to provide the substantive evidence the Commission requires to make an affirmative finding that re-licensing all five projects would be "best adapted to comprehensive scheme ..." as required under Section 10(a). Such reasoning when standing alone (license denial may cost us money) is also clearly out of step with the Commission' 1994 Policy Statement (Docket RM-93-23 at 18) which informs licensees: "... it must be recognized that meeting reasonable environmental costs is a part of today's cost of doing business." as wells as the opinion of the Court of Appeals for the Seventh Circuit in Wisconsin Public Service Corp. v. FERC (emphasis added): "[T]here can be no guarantee of profitability of water power projects under the Federal Power Act; profitability is at risk from a number of variable factors, and values other than profitability require appropriate consideration."
Lastly, while licensee dismisses FPR's assignation of significance to the two 500 megawatt natural gas generating facilities proposed to be built near licensee's mill as "not relevant to an analysis of the these Projects"; licensee simultaneous cites Congressional testimony indicating the availability of power from such sources is relevant ("the reasonable availability and cost of replacement alternative is only one of several factors to be weighted in evaluating need") (Both, Licensee's Response at Appendix I-2). And while licensee chides FPR for not providing an economic analysis (per Mead Corp., 72 FERC ¶ 61,027) showing the projects are not needed; licensee fails to provide or cite any analysis showing the projects are needed or that project benefits outweigh their costs. Licensee states: "FPR provides no evidence that under such a current economic analysis the Projects should not be re-licensed" (Appendix I-2); however, licensee fails to provide or cite any economic analyses to support its claim that projects should be licensed.
In sum, licensee asks the Commission and the owners of the Presumpscot River, the citizens of Maine, to authorize and declare legal and appropriate the continued destruction of the native fisheries in half of the Presumpscot River by continuing to inundate and eliminate virtually all of the river's free-flowing habitat for 12 contiguous miles; and to sanction this destruction solely on the basis of licensee's undocumented claim that replacing the power from three small existing projects with power from other sources may in some unquantified way harm its "competitiveness" among unnamed competitors.
In its application for license and its 7/19 response to FPR's motion for license denial, licenseee offers virtually no substantive evidence its projects as proposed meet the "best adapted to" standard of Section 10(a) and thus merit new licenses. As such, Maine Council ASF requests the Commission summarily dismiss licensee's application for new license for these projects unless and until such a time that licensee provides the Commission with the requisite substantive evidence to support an affirmative finding to do so.
In conclusion, there is sufficient evidence in the record for the Commission to find the Saccarappa, Little Falls and Mallison Falls projects as proposed produce very small amounts of power on a regional and statewide basis and provide none for the general public; that they provide a very small portion of licensee's own energy needs (8.5 percent or less); that by licensee's own statements, any "low-cost hydropower" benefits it might enjoy from these projects are limited by their small capacity and the predicted increase in generating costs at the projects from licensee's proposed enhancements; and that given licensee's own statement that it now purchases 75 percent or more of its power from outside sources, there is sufficient power available locally to easily replace the lost power from these projects if they were denied new licenses.

Recommendation: In order to substantiate licensee's claim the Saccarappa, Little Falls and Mallison Falls projects "assist" the company's competitiveness, we recommend the Commission request the data from licensee to sufficient to determine the validity of this speculative claim. At minimum, data requested should include documentation showing the actual cost of power licensee now purchases; estimated annual generating output from the three projects as licensee has proposed them; actual annual O&M costs without project enhancements; and total estimated O&M costs with project enhancement costs factored in. We caution that any estimates of "air pollution" costs of replacement power (as detailed by licensee) should not be considered unless similar estimates of the value of the lost resource (7 miles of the Presumpscot River) are given similar study and consideration.

MCASF's RECOMMENDED ACTION

In contrast to licensee's presumptive, vague and unsubstantiated basis for requesting an affirmative finding by the Commission that its projects fulfill the standards of Section 10(a) and other sections of the Federal Power Act, Maine Council ASF can provide the Commission with the firmly substantiated evidence to show its recommended action is by far the "best adapted to a comprehensive scheme for improving and developing a waterway or waterways ..." as required under Section 10(a).
As part of our comprehensive and integrated plan or "scheme" for the waterway, we propose license denial and decommissioning of the Saccarappa Falls, Mallison Falls and Little Falls projects as well as re-licensing and continued operation of the Dundee and Gambo Falls projects with appropriate terms and conditions. Equipped with our recommended action (which is nearly identical to that forwarded to the Commission by FPR) and licensee's recommended action (per its application for re-license), the Commission can conduct the requisite analysis to determine which of the recommended actions is "best adapted to a comprehensive scheme for improving and developing a waterway ..." in accordance with the standards of Section 10(a).

THE RECOMMENDED ACTIONS COMPARED:

In comparison with licensee's recommended action, Maine Council ASF's recommended action for the Presumpscot River and project areas is embedded in a comprehensive and integrated plan for the waterway which allows for a much wider variety of public uses and benefits than licensee's recommended action. Our plan and recommended action provides for the continuation of substantial and valuable power benefits to the licensee and new and valuable recreational benefits accruing from the restoration of one third of the total length of the Presumpscot River.
Under our comprehensive plan and recommended action, two of licensee's five projects in the proceeding would be relicensed under appropriate license conditions as determined by the Commission and continue to provide electricity to help meet licensee's mill's energy requirements and assist licensee's "competitiveness." Licensee would also continue receiving power benefits from its Eel Weir project on the river to supplement its energy needs. Under our proposal, licensee would still retain 66 percent of its existing power generation benefits from the Presumpscot River. Under our proposal, the existing public uses of two of licensee's projects, Gambo and Dundee, for swimming, boating, stillwater angling and other recreation would be preserved, in particular the town of Windham's public beach and swimming area on the Dundee impoundment.
Under our proposal, the existing public uses and benefits of the river would be greatly expanded and improved through the restoration of the river's free-flowing habitat from the base of the Saccarappa Falls to the base of the Gambo Falls. Our proposal restores approx. 7 miles of free-flowing riverine habitat to the river; licensee's restores none. Our proposal provides an additional 7 miles of free-flowing riverine habitat preferred (and required) by Atlantic salmon and other riverine salmonids to the river; licensee's proposal provides none. Our proposal restores the habitat and access necessary to re-establish self-sustaining salmon and salmonid populations to a significant portion of the project area; licensee's proposal will continue to preclude any such populations from becoming re-established. Our proposal provides approx. 7 miles of free-flowing river for canoeing, kayaking and innertubing; licensee's proposal provides none. Our proposal will offer the public the rare and spectacular sight of wild resident and sea-run Atlantic salmon leaping Saccarappa, Mallison and Little Falls; licensee's proposal will not. Our proposal will allow residents, tourists and other visitors to view a significant portion of the Presumpscot River in a condition quite similar to the way it was 200 years ago; licensee's proposal will not. In conjunction with the impending removal of the head of tide Smelt Hill Dam, our proposal will restore appoximately three fourths of the Presumpscot River to its natural, free-flowing condition; licensee's proposal will not. With the provision of a small fish passage device at Cumberland Mills, our proposal will provide free access and historic habitat conditions for all of the river's native migratory fish species from Casco Bay to Gambo Falls (more than 15 river miles); licensee's proposal will not.
Our proposal represents a credible, achievable and cost-effective plan to accommodate a wide variety of legitimate and beneficial power and non-power uses of the Presumpscot River for citizens and industry, including provisions for the protection, mitigation and enhancement of the river's indigenous fish and wildlife species. Licensee's proposal does not.
Our proposal recognizes and accommodates licensee's legitimate desire to receive hydropower benefits from the Presumpscot River and incorporates this desire into a comprehensive plan for the river which also accommodates legitimate non-power uses requiring free-flowing, riverine habitat. Licensee's proposal does not.
Our proposal is part of an integrated, comprehensive multiple-use plan for the Presumpscot River which seeks and achieves an appropriate balance between a diverse array of contemporary societal benefits and needs, including the licensee's. Licensee's proposal is not.

OUR RECOMMENDED ACTION DOES A FAR BETTER JOB OF SATISFYING SECTION 10(A) AND SECTION 4(E) OF THE FEDERAL POWER ACT THAN LICENSEE'S RECOMMENDED ACTION AND AS SUCH MUST BE SELECTED OVER LICENSEE'S.

As detailed above, the striking contrast in vision, scope and diversity of benefits provided by our proposal as compared to licensee's is particularly pertinent to the Commission's statutory obligation to issue licenses only when they are in accordance with the Federal Power Act, including Section 10(a) as revised and amended by the U.S. Congress:

"That the project adopted ... shall be such as in the judgment of the Commission will be best adapted to a comprehensive scheme for improving and developing a waterway or waterways for the use and benefit of interstate commerce, for the improvement and utilization of water power development, for the adequate protection, mitigation, and enhancement of fish and wildlife (including related spawning grounds and habitat), and for other beneficial public uses, including irrigation, flood control, water supply, and recreational and other purposes referred to in section 4 (e) ..."

In comparison to licensee's, our recommended action is far better adapted to satisfying the many uses and benefits Section 10(a) specifically details as components which should comprise "a comprehensive scheme for improving and developing a waterway ..." As such, our recommended action easily merits the Commission's preference when compared to licensee's. For example:

· Our proposal provides for the utilization of water power development on the waterway by recommending re-licensing, with appropriate conditions, licensee's Dundee and Gambo Falls projects and recognizing the existing output of licensee's Eel Weir Project and the North Gorham project, owned by FPL Group. Our proposal will provide significant and new non-power benefits to the public while preserving 73 percent of the river's existing installed capacity (11.5 megawatts) and 66 percent of licensee's exising installed capacity (9.25 megawatts). Licensee's proposal provides for an additional 3.15 megawatts of capacity compared with our proposal; but does so only at the expense of all of the historic, free-flowing habitat in the project areas and the valuable non-power benefits restoration of this habitat would provide.

· Our proposal provides for significant enhancement of the Presumpscot's native fisheries in the project areas, including spawning grounds and habitat, by restoring approx. 7 miles of free-flowing spawning and rearing habitat for the river's native Atlantic salmon, brook trout and other species and creating the necessary conditions for the re-establishment of these valuable and highly desirable species to a significant segment of the Presumpscot River. In contrast, licensee's proposal provides no enhancement of native salmon or salmonid habitat anywhere in the river and will preclude and prohibit succesful re-establishment of self-sustaining populations of these species to the project waters by continuing to deny these species their required and historic free-flowing spawning and rearing habitat.

· Our proposal provides commensurate mitigation for the significant amount of free-flowing habitat inundated and destroyed by the Dundee and Gambo projects by restoring all of the free-flowing habitat in the Saccarappa, Little Falls and Mallison Falls project areas. In contrast, licensee's proposal provides absolutely no mitigation to replace or even partially replace the approx. 12 miles of historic free-flowing salmonid habitat impounded and destroyed by its five projects. Nor does licensee provide any mitigation to replace the valuable historic native fisheries which were destroyed by the construction of licensee's projects. In fact, nearly all of the project mitigation contemplated by licensee (eel passage, minimum bypass flows) would undoubtedly be part of mandatory license conditions under Sect. 401 of the Clean Water Act and Sect. 18 of the Federal Power Act anyways. We note that licensee and agencies are still in disagreement over appropriate bypass flows and American eel protection (Saccarappa Application at E2-26). In contrast to licensee's proposal, our proposal will provide full flows (as opposed to minimum) for bypass reaches on the Saccarappa, Little Falls and Mallison projects since the river will be restored to its natural condition.

· Our proposal provides protection for the river's native fish species by restoring a substantial area of free-flowing habitat to the project area, thus ensuring these species will have sufficient spawning and rearing habitat to maintain self-sustaining populations. In contrast, licensee's proposal provides no protection for fish species native to the project area (salmon and salmonids) since its proposal calls for maintaining project impoundments in a way that inundates virtually all of the free-flowing spawning and rearing habitat these species require.

· Our proposal will provide significant enhancements and protection for adult and juvenile American eel, a priority species for the State of Maine in these waters. Removal of the Mallison, Little Falls and Saccarappa Dams will eliminate up and downstream passage inefficiencies for the species at these projects, eliminate turbine and related mortality for downmigrating adult silver eels at these projects, reduce cumulative mortality on the entire river, and relieve licensee of the potentially substantial, long-term costs associated with providing safe passage for American eel at these projects. In this regard, our proposal offers superior enhancement and protection to American eel than licensee's proposal. While licensee's proposal (passage devices, turbine shutdowns) may reduce passage inefficiency and mortality at three projects, our proposal will eliminate them. We also note that licensee has expressed reluctance to provide any protection or enhancements for the Presumpscot's eel resource, as evidenced by the Oct. 28, 1998 Substantive Disagreement Meeting regarding this issue and fisheries agencies rejections as inadequate licensee's downstream protection proposal (Saccarappa Application at E2-33) and by its statement that, "it is unclear whether upstream and downstream passage improvements at the Project would appreciably benefit the American eel population or the number of eels returning to U.S. rivers." (Ibid.) Contrary to licensee, we are quite confident the Presumpscot's native eel population will greatly benefit from not being ground up and lacerated in licensee's turbines or barred by licensee's dams from reaching preferred habitat. Our proposal will fully accomplish these common-sense objectives; licensee's will not.

· Our proposal will preserve existing recreational uses and benefits in the project areas and the river as a whole while creating new uses and benefits that are highly valued and desired by local and visiting recreationists. Under our proposal, ample opportunities for stillwater boating, angling, swimming and other recreation will still exist on the Dundee and Gambo project impoundments, where most of this activity currently occurs. But significantly, our proposal will create substantial new recreational benefits, particularly riverine angling for wild salmonids and other species, canoeing, kayaking, innertubing and wildlife viewing in free-flowing water. Our proposal will provide public viewing opportunities for riverine and sea-run Atlantic salmon leaping Saccarappa, Mallison and Little Falls. Unless expressly forbidden by abuttors, our proposal will also provide new and extensive angling opportunities for wading or shore anglers in the shallow, free-flowing habitat of the river from Gambo Falls to the base of Saccarappa Falls. This type of opportunity is largely absent in the project areas because of impoundment depths. In contrast, Licensee's proposal offers none of these new recreational benefits and uses and in fact definitively precludes most or all of them.

· Our proposal creates the opportunity for increased economic benefits for communities and their citizens near the Presumpscot River. The restoration of a 7-mile long high-quality, scenic riverine fishery for salmon and other salmonids will attract visiting anglers who will rely on local merchants for equipment, food, lodging, services, canoe rentals, guides and other products. Canoeists will be attracted to a 15 mile-long canoe trip from Gambo Falls to Casco Bay with the provision of portage facilities at Cumberland Mills. Anglers from across Maine and New England regularly drive dozens or hundreds of miles to seek landlocked, sea-run salmon and trout in scenic, free-flowing settings. Nobody travels any distance to fish in a small hydro impoundment. Licensee's proposal provides no opportunity for increased economic benefits to communities and citizens near the Presumpscot RIver. Since licensee proposes its projects to remain essentially as they are today, any economic benefits its impoundments provide are already being provided.

· Our proposal looks at the Presumpscot River in a comprehensive, multiple-use fashion and allows for a wide diversity of valuable power and non-power benefits. Licensee's proposal looks at the Presumpscot River in a narrow, single-use fashion which restricts the diversity of non-power uses to only those which can be conducted on a 10-mile-long chain of slackwater dam impoundments.

· Our proposal represents a careful, comprehensive effort to provide a balance of legitimate power and non-power uses on the Presumpscot River and a balanced mix of riverine and stillwater recreation and riverine and stillwater fish and wildlife habitat. Licensee's proposal makes no effort to balance legitimate power and non-power uses of the Presumpscot Riiver. Instead, licensee's proposal gives unquestioned primacy to its own private use of the river for power production and precludes any use or benefit requiring something other than a 10 mile dam impoundment

· Our proposal looks to the future by adopting an enlightened, integrated approach to satisfying multiple needs and uses of the Presumpscot River in the coming century . Licensee's proposal looks to the past by saying half of the Presumpscot River should remain impounded for the next 40 years because that's the way it's been for the last 80 years.

· In keeping with Section 10(a), our proposal improves the waterway and project areas by greatly increasing the river's free-flowing habitat with only a minor decrease in power production, allowing a wide variety of improvements in the recreational benefits and fisheries habitat over existing conditions. In stark contrast, licensee's proposal offers no improvements to the waterway since its proposal essentially calls for the project areas to remain completely impounded, as they for most of this century. As argued above, the value of our enhancements greatly exceed the value of those of licensee's intended for the same purpose (eel passage, recreation, bypass flows). Others, such as boat access points, can easily be accomplished through other means whether the projects continue to exist or not.

· While licensee's application does not make a single mention of the restoration of the lower Presumpscot River through the removal of the Smelt Hill Dam, our proposal recognizes and integrates this action as part of a comprehensive plan for the waterway which seeks to achieve a high degree of ecosystem restoration with a small reduction in power production. The fact that the dams we have proposed for license denial are the lowest power producers on the river; are the lowermost dams in this proceeding and are consecutive on the river; and that they are directly above the soon-to-be restored reach and will create a 15 mile (nearly) free-flowing river reconnected to the sea is not a coincidence. It is a direct result of the careful analysis we have invested in creating a truly "comprehensive" plan for the Presumpscot River. Licensee's proposal, fixated solely on its own perceived and unsubstantiated "needs", fails to seek or achieve this level of analysis and integration which Congress clearly desired when amending Section 10(a) and 4(e) in 1986.

OUR RECOMMENDED ACTION FULLY SATISFIES THE "EQUAL CONSIDERATION" STANDARD OF SECTION 4(E) OF THE FEDERAL POWER ACT; LICENSEE'S DOES NOT EVEN ATTEMPT TO DO SO.

Section 4(e) of the Federal Power Act requires that, "In deciding whether to issue any license under this Part for any project, the Commission, in addition to the power and development purposes for which license are issued, shall give equal consideration to the purposes of energy conservation, the protection, mitigation, and enhancement of, fish and wildlife (including related spawning grounds and habitat), the protection of recreational opportunities, and the preservation of other aspects of environmental quality."

As the Commission states in its 1994 Policy Statement (Docket RM:93-23), changes by Congress to the Federal Power Act, including Section 10(a) and 4(e) had the following intent: "The 1986 legislation directed the Commission, when establishing license conditions, to reach an appropriate balance between power and other developmental interests and the protection of nondevelopmental resources, such as fish and wildlife."

As outlined in detail above, our recommended action fully satisfies the "equal consideration" requirement of Section 4(e) for nondevelopment resources as well as satisfying the "power and development purposes" for which licenses are granted. By accomplishing both of these objectives, our is the only recommended action before the Commission which comes even close to reaching the type "appropriate balance" which Congress directed the Commission to seek. More important, our recommended action is far superior to licensee's simply because ours actively and deliberately seeks and achieves the degree of harmonious balance between power and non-power uses Congress intended. In contrast, licensee's proposal fails to seek or achieve such an "appropriate balance" by steadfastly refusing to restore any free-flowing riverine habitat (except for existing bypass reaches) in the 12 miles of the project areas. As such, its proposal falls woefully short of both the "equal consideration" standard and other standards set forth in Section 4(e) and the Congressional intent behind them. For example:

· Licensee proposes to keep all 12 miles of the Presumpscot River in the project boundaries in fully impounded, leaving none of river in a condition suitable for non-power uses requiring free-flowing habitat, including protection and enhancement of the river's native, riverine fish species and riverine angling and recreation. If licensee's proposal represents an attempt to "strike" a balance, the strike is so faint as to be indiscernible.

· Licensee's proposal makes no commitment to explore and implement energy conservation measures at its mill or elsewhere to reduce its need for power from the Presumpscot River and to reduce the environmental damage (destruction of free-flowing habitat) its dams now exact on the Presumpscot River.

· Licensee's proposal offers no mitigation commensurate to the value of the 12-miles of free-flowing river its dams have destroyed; the historic spawning and rearing habitat for native, riverine fish its dams have destroyed; or the significant and valuable recreational opportunities (riverine angling and boating) its dams have destroyed.

· Licensee's proposal offers no enhancements for the river's pre-eminent native gamefish species, particularly salmon and brook trout, and precludes any future re-establishment of self-sustaining populations of these species in the project areas.

· While licensee contemplates some enhancements and protection for American eel, our recommended action provides far greater and certain protection and enhancement for the species by eliminating (rather than potentially reducing) passage inefficiency and mortality at three of licensee's five projects in this proceeding.

In contrast to licensee's, our recommended action seeks and achieves the "appropriate balance" Congress directed the Commission to seek by:

· Accommodating and providing for legitimate power and non-power uses of the Presumpscot River in an equitable, integrated and comprehensive fashion.
· Maintaining 72 percent of the existing installed hydroelectric capacity on the Presumpscot River and 66 percent of licensee's.
· Decommissioning three small hydropower dams on the river while leaving four much larger projects in operation.
· Providing abundant opportunities for stillwater and riverine recreation. · Providing abundant and suitable habitat for native and exotic stillwater fish and wildlife species and native riverine and migratory fish and wildlife species.
· Restoring nearly one third of the Presumpscot River (7 miles) to its historic, free-flowing habitat conditions while impacting less than 10 percent of energy requirements at licensee's mill.
· In combination with ongoing restoration of the river below Cumberland Mills, restoring nearly three quarters of the Presumpscot River to a free-flowing condition suitable to its native resident and migratory fish species while reducing the river's power output by onlyone quarter.

C. COMMENTS ON LICENSEE'S JULY 19, 1999 RESPONSE TO FRIENDS OF THE PRESUMPSCOT RIVER .

Maine Council ASF concurs with Friends of the Presumpscot River (FPR) that decommissioning of licensee's Little Falls, Mallison Falls and Sarrarappa Falls projects is in the public's interest and is the most cost-effective method of satisfying the "balancing test" of the Electric Consumer's Protection Act. It is clear in licensee's response to FPR that major factual disputes exist between the licensee and FPR regarding the impacts and benefits resulting from decommissioning of these projects. To provide the Commission with additional factual and analytical insight on these disputes, Maine Council ASF provides a detailed discussion of the the benefits of our recommended action and comments and additional information in support of our action directed to the issues raised by licenseein its July 19, 1999 response to FPR.

1. At licensee's Appendix 1-4, it is stated, "There is no evidence to support FPR's contention that removal of the dams will result in the establishment of high-quality gravel bottom, riffles and pools."

To the contrary, there is ample evidence the Presumpscot in the project areas had numerous riffles, pools, and rapids; and ample evidence the reach supported native populations of coldwater fish species until their habitat was destroyed by licensee's dams.
Historic records, the river's steep gradient from Sebago Lake to Casco Bay (greater than 10 vertical feet per mile), and the character of the free-flowing reach directly below Sebago Lake provide ample evidence that the river reach now impounded by licensee's dams contain the type of habitat (riffles, pools, rapids) preferred by the Presumpscot's native, historic Atlantic salmon populations. Goode (1887) stated: "Lake Sebago, the second lake in the State in size, lies but 22 miles from the sea, but has an elevation of 247 feet. The Presumpscot is therefore a rapid river. It has remarkable clear water, and abounded naturally in gravelly rapids. It was frequented by salmon, shad, alewives, but seems to have been best adapted to salmon." Kendall (1935) stated: " ... these smaller salmon, known as 'Jumpers' were found in the upper part of the river wherever there were waterfalls or rapids." Indeed, the names of licensee's dams (Dundee Falls, Gambo Falls, Little Falls, Mallison Falls, Saccarappa Falls) attest to the fact they are sited on top of the type of habitat (falls, rapids, riffles) the river's native salmonids prefer. This is also shown in the very small free-flowing river remnants immediately below each dam, which are composed of rapids, small falls and gravelly or bouldery riffles until licensee's dam impoundments flood them. While not every single foot of the river impounded by licensee's three lower dams is riffle, rapid or pool; the fact that these areas held historic populations of salmonids is prima facie evidence of their suitability for these species, once returned to their free-flowing condition.

2. At licensee's Appendix 1-4, it is stated: "While there is no evidence that the Presumpscot River could support natural populations of coldwater species other than seasonally, as it now does, the quality of the water is sufficient to support indigenous fish."
This statement is correct if exclusively applied to the project areas as they exist today and lends even more credence to removing three of SAPPI's dams. In this response, licensee admits that its projects preclude the existence (or re-establishment) of the natural populations of coldwater fish species which historically occupied the project areas. In this respect, we concur with licensee's characterization of the severe impacts its projects have on the Presumpscot River and its ability to support its native Atlantic salmon and brook trout. We also concur with licensee's assertion that a historically rapid river now entirely impounded by dams, with no free-flowing water left, is physically incapable of supporting native species such as landlocked and sea-run salmon and brook trout. On the other hand, this statement is incorrect and without any factual basis if licensee intends the statement to accurately characterize the Presumpscot River before licensee's projects were constructed.
Abundant historic evidence exists which shows the Presumpscot supported populations of lake-dwelling, riverine and sea-run Atlantic salmon; and that these populations persisted until the construction of multiple dams on the river eliminated their habitat, particularly the dams in this proceeding. Kendall (1935) identified the construction of the Dundee project as a key factor in bringing the Presumpscot "jumper" to extinction by destroying its last remaining piece of free-flowing habitat in the upper river.
In regard to sea-run salmon, Kendall stated in his 1935 volume, Fishes of New England, Salmon Family, Part Two - The Salmons: "Presumpscot River -- This was once one of the finest salmon rivers for its size in the state of Maine, but was early obstructed by dams and only a few salmon have since been taken. Salmon were reported at Cumberland Mills and Sacarappa, in 1873."
In the same volume, Kendall described a resident, riverine population of salmon in the Presumpscot, based on investigations in the late 1800s and early 1900s: "In the Presumpscot River the resident salmon appeared to subsist largely upon the aquatic stages of various insects such as caddis fly larvae, stonefly and mayfly nymphs, alderfly larvae and nymphs. Frequently the fish would be gorged with these bottom forms, but often they would take the adult insect at the surface and even leap from the water for the flying insect. Adult stone flies (locally called 'millflies') were excellent bait for the so-called 'jumpers' of the Presumpscot." Kendall included a colored plate of a Presumpscot "jumper" adapted from an original life painting of a specimen he collected.
Historic evidence clearly indicates that populations (lake dwelling salmon, resident 'jumpers' and sea-run salmon) disappeared due to two causes: a lack of fish passage at dams and later, the complete elimination of the river's free-flowing habitat as dam owners impounded (or dewatered) virtually all of the Presumpscot River. Kendall wrote:
"In the Presumpscot River, which is the outlet of Sebago Lake, the Sebago salmon used to breed and in the spring of the year, large well-conditioned salmon were found in the stream. Later they disappeared. Prior to the erection of the dam at the head of the river, and later while the fishway was effective, most, if not all, of the salmon returned to the lake. In later years, the fishway having become impassable, some of the fish continued to disappear, where to, no one knows ... However, small salmon resided in the river the year around. Until the new dam was built at the head of the river and the water diverted by a canal these smaller salmon, known as 'Jumpers' were found in the upper part of the river wherever there were waterfalls or rapids. After this the fish were still inhabiting the river below the dam at North Gorham ... They appear now to be extinct, the locality below the North Gorham dam having been recently ruined by the erection of a dam farther down which backs up the still water nearly up to the North Gorham Dam." (the dam mentioned here is licensee's Dundee project.)

The historic evidence is unequivocal that more than any other factor, the construction of multiple dams without fishways and their impounding of virtually all of the free-flowing Presumpscot River destroyed the river's native, indigenous salmon populations. As licensee states in its response to FPR, chemical water quality parameters in the project impoundments appear sufficient to support salmonids. Yet, as licensee also states in its response, existing fisheries surveys in the project impoundments failed to locate self-sustaining populations of Atlantic salmon, landlocked or otherwise, despite adequate chemical water quality conditions. The obvious conclusion here is that the same conditions which destroyed the Presumpscot's native salmon -- the destruction of free-flowing habitat by licensee's dams -- is the same condition which continues to preventtheir re-establishment today. The absence of a naturally reproducing salmon population in the project areas despite years of heavy stocking by IF&W and suitable chemical water quality proves that the physical nature of the impoundments -- the directresult of licensee's dams -- is the key limiting factor preventing re-establishment of the river's historic populations of indigenous, native salmon. This argument is buttressed by comments by regional fisheries biologist Stuart DeRoche, who noted: "Less than 15 percent of the main river from Sebago Lake to Westbrook now contains the kind of habitat that trout and salmon require for spawning and nursery areas. This loss of fast water habitat ... precludes coldwater management in the main Presumpscot River." (MaineRivers, Selected Articles from Maine Fish & Wildlife Magazine, 1979)
Historic evidence indicates the Presumpscot's native, riverine salmon population was found primarily in and near the river's highly oxygenated rapids, riffles and falls (See Kendall, 1935: "these smaller salmon, known as 'Jumpers' were found in the upper part of the river wherever there were waterfalls or rapids."). Maine Council ASF notes that many of the waterfalls and rapids Kendall said were prime salmon habitat are now entombed beneath licensee's dams. More general scientific studies indicate that Atlantic salmon (landlocked and sea-run) must have free-flowing riverine habitat for spawning and juvenile development (Warner and Havey, 1970).
Not surprisingly, the existing fisheries survey cited by the licensee's response to FPR (Icthyological Associates and Duke Engineering Services, 1998) found no evidence that self-sustaining populations of Atlantic salmon (sea-run or landlocked) exist in the river reaches impounded by licensee's projects. Instead of refuting FPR's assertion that licensee's dams prevent the restoration of self-sustaining populations of several indigenous (ie. native) fish species to the project area, licensee's citation supports and proves FPR's assertion. The importance of free-flowing riverine habitat was amply demonstrated on Memorial Day weekend of this year, when a Maine Council ASF member noted numerous 1-2" salmon and brook trout fry 200 feet below the licensee's Eel Weir dam spillway at the outlet of Sebago Lake and found more fry all the way to the Route 35 bridge. This observation materially confirms that landlocked salmon and brook trout, both native species to the Presumpscot, can successfully reproduce in the river -- if they have free-flowing habitat -- and refutes licensee's assertion these species never thrived in the river.

In sum, there is abundant evidence:

1. That the Presumpscot River, prior to intensive dam construction, was inhabited by Sebago Lake salmon for spawning and juvenile development; by resident riverine landlocked salmon ('jumpers'); and by sea-run Atlantic salmon for spawning and juvenile development.
2. That authoritative eyewitness observers attributed the extinction of these populations directly to the construction of dams which barred access to free-flowing habitat and later, destroyed virtually all of the free-flowing habitat in the river.
3. That by licensee's own admision, chemical water quality characteristics in the river today appear capable of supporting salmon, yet self-sustaining populations of salmon are absent from licensee's project waters despite decades of heavy stocking by the State of Maine.
4. That conditions in licensee's project areas provide virtually no free-flowing habitat, especially the rapids, riffles and gravel beds that the river's native salmon require for spawning and juvenile development.
5. That according to eyewitness accounts, the habitat preferred by salmon was previously found in the project areas and used by salmon until the time licensee's dams destroyed this habitat.

While licensee freely admits self-sustaining populations of salmonids are absent from its project waters, it fails to identify any specific limiting factors which have caused such an absence. This is understandable because abundant evidence, as cited above, shows the key (and only) limiting factor is licensee's decision to configure their dams in a way which inundates all the free-flowing habitat in the project areas.

3. At licensee's Appendix 1-7, it is stated: "FPR has provided no evidence that removal of the Project dams will result in more recreational opportunities."

Per licensee's invitation to provide evidence that breaching of the Little Falls, Mallison Falls and Saccarappa Falls Dams would provide greater recreational opportunities than the project impoundments, we refer to MDIF&W's quantitative studies of angler use of the 1.25 mile free-flowing river reach immediately below Sebago Lake. These studies showed angler use days in this reach growing from 2,811 angler trips in 1993 to 6,826 trips in 1995 (SAPPI, ICD for Eel Weir, FERC Project No. 2984, p. 59). It should be noted that angler trips in this reach prior to 1993 were virtually non-existent because licensee refused to provide any flow of water from its Eel Weir Dam (except for leakage) to enter the 1.25 mile river reach. Our own site visits to the free-flowing reach on the Memorial Day Weekend in 1999 found anglers situated on each and every pool in this reach on both Saturday and Sunday, leaving little space for additional anglers. Clearly, the demand for riverine angling opportunities on the Presumpscot often exceeds the supply.
Wild, riverine populations of landlocked salmon are found virtually nowhere else in the United States except for Maine and a few rivers in northern Vermont and New Hampshire. Even within Maine, riverine angling opportunities for wild landlocked salmon are limited to a very few rivers, most of which are in far northern or eastern Maine. In comparison, stillwater angling opportunities for resident black bass or stocked trout (the only gamefish in the project waters) can be easily found in hundreds of ponds and lakes in Maine and thousands in the Eastern United States. In sum, the angling opportunity that would be created by FPR's request for decommissioning is very scarce and eagerly sought by anglers throughout New England. In stark contrast, the type of angling opportunity offered in the existing projects can be found in virtually every town with a farm pond in the eastern United States and in dozens and dozens of waters in close proximity to licensee's projects. In support of our assertions, we have attached various advertisements for sporting camps and guide services from the Maine Sportsman magazine catering to anglers seeking riverine landlocked salmon angling opportunities. As the attachment shows, demand for this type of angling is very high in Maine and generates needed income and employment for guides and lodging staff. In contrast, we failed to find any sporting camp or guide service advertised in the Maine Sportsman offering lodging and trips to the licensee's dam impoundments to catch black bass, yellow perch, fall fish and freshly stocked hatchery trout.
We further note that the several "enhancements" described by the licensee in its response to FPR (Appendix 1-6 and 1-7) will do absolutely nothing to restore the most important recreational asset the Presumpscot River once offered and can offer again: wild lake-dwelling, riverine and sea-run Atlantic salmon in their natal, free-flowing habitat. Instead, these enhancements will only provide a limited amount of access improvements to waters which cannot support any of their native, indigenous gamefish species because of licensee's projects and project operations.
Lastly we note licensee's ability to predict angler preference and interest on the Presumpscot River, based on its previous predictions, is somewhat less than credible. In 1986, licensee objected to additional flows in the Eel Weir bypass reach, claiming: "The benefit of fishing opportunities in the bypass reach would reach only a limited group of fishermen. No groundswell of need for this particular type of fishing is cited, which is significant particularly in view of the other substantial fishing opportunities in the area." (Licensee's letter to FERC, Oct. 9, 1986). Given the high angler use figures for the bypass licensee now cites in its April 1999 ICD for the project, licensee's 1986 prediction of limited angler use and interest in the free-flowing bypass reach was flat-out wrong. In fact, according to licensee's ICD, angler use of the 1. 25 mile bypass reach in 1995 (6,826 angler days) was twice as high as angler use of Sebago Lake for ice fishing that year (3,382 angler days). We ask the Commission to consider these facts when assessing the validity of licensee's predictions of angler interest in this proceeding.

4. At Appendix 1-1, licensee states, "The Commission has often affirmed the importance of hydroelectric projects to the country."

The Commission has also affirmed the importance of non-power benefits over existing or new hydroelectric generating capacity in certain instances, as shown by its decommissioning order for the Edwards Project on Maine's Kennebec River and its denial of a new major project license for the Basin Mills Project on Maine's Penobscot River. That the Commission generally supports hydroelectric development in Maine and other parts of the country is irrelevant to this proceeding since the Commission must issue or deny licenses based on substantive evidence specific to these projects on this river.

5. At licensee's Appendix 1-4, it is stated: "Under Maine law, references to Class B waters relate to discharges of pollutants, which is not at issue here."

This is incorrect. While Maine's water quality classification system and criteria are often used to regulate (or prohibit) the discharge of pollutants into the state's waterways, this is not their exclusive, limited purpose. Maine's Natural Resources Protection Act (38 MRSA §480 ¶ D, sub-1) prohibits those acquiring permits under the Act from conducting activities which will violate any state water quality law, including those "governing the classification of the State's waters." Activities requiring a permit under 38 MRSA §480 include dredging, bulldozing, removing or displacing of soil; draining or otherwise dewatering; filling; or any construction, repair or alteration to a permanent structure. We lastly note that minimum flows in bypass reaches are required to comply with the river classification system as well. Clearly, the legal scope of the state's river classification and water quality standards (narrative and numeric) extends well beyond the discharge of pollutants, contrary to licensee's claim. We reserve the right to provide comment and additional evidence regarding whether these projects meet state water quality standards, through the state's §401 analysis and this proceeding.

MOTION FOR EVIDENTIARY HEARING:

We request an evidentiary hearing in order to substantiate licensee's claim the Saccarappa, Little Falls and Mallison Falls projects "assist" the company's competitiveness, and that the Commission request the data from licensee to sufficient to determine the validity of this speculative claim. At minimum, data requested should include documentation showing the actual cost of power licensee now purchases; estimated annual generating output from the three projects as licensee has proposed them; actual annual O&M costs without project enhancements; and total estimated O&M costs with project enhancement costs factored in. We caution that any estimates of "air pollution" costs of replacement power (as detailed by licensee) should not be considered unless similar estimates of the value of the lost resource (7 miles of the Presumpscot River) are given similar study and consideration.

CERTIFICATE OF SERVICE:

I, Douglas Watts, certify that this 3rd day of August 1999, a copy of the foregoing motion and attachments was served by first class mail upon each person on the official service list.



___________________________
Douglas Watts


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