Fair Value, Net Investment and Relicensingby John W. Gulliver, Pierce, Atwood, Scribner, Allen, Smith Lancaster, Portland, United States,
Abstract: The Federal Power Act ('Act') requires that a Federal Energy Regulatory Commission ('FERC') license receive only 'net investment' in its project, if, upon relicensing, the United States Government takes over the project or FERC awards the new license to a competing applicant. 'Net investment,' which essentially is original cost of physical plant less depreciation, amounts to less than the fair market value of a project. In addition to being constitutionally suspect, this compensation scheme has several practical and strategic implications for the hydro industry.
Subject Headings: Licensure and certification | Power plants | Investments | Federal government | Hydro power | State government | Awards and prizes | North America | United States
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