20031110 Ver 6_Other Agency Comments_20100528 (4)

NCDENR
North Carolina Department of Environment and Natural Resources
Beverly Eaves Perdue
Governor
Division of Water Resources
Thomas A. Reeder
Director
L/ Dee Freeman
Secretary
May 28, 2010
Mr. John Dorney
Division of Water Quality
Non-Discharge Branch
2321 Crabtree Boulevard, Suite 250
Raleigh, NC 27604
Subject: Application for Section 401 Water Quality Certification
Nantahala Hydroelectric Project (FERC No. 2692)
Duke Energy Carolinas, LLC - Macon and Clay Counties
DWQ Project Number 2003-0110 version 6
Dear Mr. Dorney:
The Division of Water Resources (NCDWR) has reviewed the application for a 401 water
quality certification submitted by Duke Energy Carolinas, LLC in conjunction with the license
application submitted to the Federal Energy Regulatory Commission (FERC) for Duke's
Nantahala Hydroelectric Project. NCDWR has been an active participant during the relicensing
process and our involvement has included: scoping and refining issues to be addressed;
reviewing and/or designing plans for technical studies; participating in field studies; active
membership in various technical work groups; reviewing and commenting on the results of
technical studies; and suggesting and evaluating various project alternatives.
The North Carolina Department of Environment and Natural Resources (NCDENR) signed a
Settlement Agreement in October 2003 - along with other resource agencies, Duke, and other
stakeholders involved in the relicensing process. Components of the Settlement include
agreements that: provide for enhanced instream flow regimes for the Nantahala River, Whiteoak
Creek and Dicks Creek; manage downstream releases during drought conditions; restrict
reservoir drawdowns; improve public access to stream flow and reservoir level information; and
provide for other aquatic ecosystem enhancements.
We recommend that the attached conditions be included in the 401 certification. These
recommendations are drawn from the appropriate sections of the Settlement Agreement. The
entire Agreement can be viewed at:
http://www.duke-energcomZpdfs/NANT Vol4 Final Web PDF
1611 Mail Service Center, Raleigh, North Carolina 27699-1611 One
Phone: [phone] FAX: [phone] Internet: www.ncwater.org NorthCarolina
An Equal Opportunity 1 Affirmative Action Employer - 50% Recycled 110% Post Consumer Paper ;Vaturallff
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification, Page 2
We also recommend that the 401 certificate for this Project include the standard 401 conditions
used in response to other hydropower relicensing submittals, including re-opener provisions.
The Low Inflow Protocol and Hydro Project Maintenance & Emergency Protocol (attachments B
and C, respectively, of the Settlement Agreement) should be incorporated by reference in the 401
certificate.
The Settlement Agreement includes provisions such that NCDENR's execution of the Settlement
Agreement places no restrictions on the Division of Water Quality (NCDWQ) in terms of review
of the 401 application and what conditions can be included.
Where necessary, these comments include revisions to reporting requirements and review and
approval authority to reflect the Division of Water Quality's responsibilities under section 401 of
the Clean Water Act (as opposed to FERC's authority subject to the New License). The word
"Licensee" from the Settlement Agreement was replaced with "Applicant" - meaning Duke
Energy Carolinas or its successors.
Unless expressly stated otherwise, references to the "License" in the attached recommended
conditions are to the new FERC license for which NCDWQ is considering issuing a 401
certificate, and the reference includes the New License and all annual licenses thereafter. These
references to the new FERC license were retained in large part because the issuance and term of
this New License determines the schedule and duration of subsequent enhancements.
If you have questions regarding these recommendations, please contact me at 919-715-5428 or
Jim.Meadgncdenr.gov.
Sincerely,
y&4?
Jim Mead
attachments
cc: Tom Fransen and Steve Reed - NCDWR
Chris Goudreau - NCWRC
Kevin Barnett - NCDWQ
Marc Bernstein - NCDOJ
Mark Cantrell - USFWS
Steve Johnson, Duke Energy
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification
1.0 Reservoir Levels
(A) The Applicant shall use the existing float-operated gage or a suitable replacement
gage to monitor the actual level of Nantahala Lake. The Applicant shall calibrate the
reservoir stage level gage within 60 days following its acceptance of the New License
and at least once every two years thereafter.
(B) The Applicant shall maintain the elevation of Nantahala Lake between the Normal
Minimum and Normal Maximum Elevations ("Normal Operating Range") indicated in
the table below, except when the Applicant is permitted to vary from the Normal
Operating Range as established below. All elevations are relative to the top of the dam
(including the flood gates and fuse plugs), with 100.0 ft = Normal Full Pond Elevation
(approximately 3012.2 ft USGS datum). The elevations shown are for the first day of the
given month. Elevations for other days of the month are determined by linear
interpolation.
Normal Full Pond Elevation = 100.0 It = approximately 3012.2 ft (USGS datum)

Month Normal
Minimum
Elevation ft Normal Target
Elevation (ft) Normal
Maximum
Elevation ft
Jan 73 78 83
Feb 76 83 88
Mar 78 88 93
Apr 85 93 98
May 93 97 99.5
Jun 93 97 99.5
Jul 93 97 99.5
Au 91 96 99.5
Se 88 93 98
Oct 83 88 93
Nov 78 83 88
Dec 73 78 83
(C) The Applicant shall endeavor in good faith to achieve the Normal Target Elevations
at Nantahala Lake.
(D) The Applicant may temporarily vary from the Normal Operating Range as identified
above if required by conditions beyond the Applicant's control or by operating
emergencies or maintenance needs as defined in Settlement Agreement Attachments B
and C. Such temporary variances shall be in accordance with the Low Inflow Protocol or
the Hydro Project Maintenance & Emergency Protocol, incorporated by reference into
this certificate as Settlement Agreement Attachments B and C, respectively.
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification
(E) As long as the actual level of Nantahala Lake is maintained within the Normal
Operating Range as identified above or appropriately within the boundaries as identified
in the Low Inflow Protocol (Attachment B) or the Hydro Project Maintenance &
Emergency Protocol (Attachment C), then the Applicant will be in compliance with
Reservoir Level conditions of this certificate.
(F) The Applicant shall fully comply with these conditions when specified by the New
License.
2.0 Stream Gages
(A) The Applicant shall reimburse the United States Geological Survey (USGS) on an
annual basis for its cost to maintain USGS Gage # 03505500 located downstream of the
Nantahala Powerhouse near River Mile I I on the Nantahala River (or a suitable
replacement gage in this vicinity as determined by USGS.
4
(B) The Applicant shall provide information in a timely manner on its website for
Nantahala Lake (the Normal Operating Range, actual reservoir level, recent reservoir
level history, near-term reservoir level projections and special messages), and Nantahala
River Bypassed Reach high flow release schedules, a hotlink to USGS Gage # 03505500
in the Nantahala Gorge (or a suitable replacement gage in this vicinity as determined by
USGS), and special messages.
(C) The Applicant shall provide information in a timely manner on its telephone system
for Nantahala Lake (actual reservoir level and special messages) and Nantahala River
Bypassed Reach high flow release schedules and special messages.
(D) The Applicant shall ensure that special messages on its website and telephone system
include but not be limited to those conveying changes in reservoir levels and high flow
releases due to implementation of the Low Inflow Protocol and/or the Hydro Project
Maintenance & Emergency Protocol incorporated by reference into this certificate as
Settlement Agreement Attachments B and C, respectively.
(E) The Applicant shall evaluate future communications technology advancements over
the term of the New License and implement cost effective technologies that enhance the
delivery of reservoir and high flow release information.
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification
3.0 Minimum Flows for Bypassed Reaches
(A) The Applicant shall provide the following minimum flows in bypassed reaches:
1) From the Whiteoak Creek Penstock: a total of 8 cfs into Dicks Creek from
November 1 through May 31 and, after installation of the second valve
required by subparagraph (C)(2) of this condition, a total of 16 cfs into Dicks
Creek from June 1 through October 31; and
2) From the Whiteoak Creek Diversion Dam after installation of the minimum
flow device required by subparagraph (C)(3) of this condition, 8 cfs or the
inflow into Whiteoak Creek Pond, whichever is less, into Whiteoak Creek at
the base of the dam from January 1 through December 31.
(B) The Applicant shall continue to maintain Dicks Creek as free flowing with outflow
from the base of Dicks Creek Diversion Dam being equal to inflow into Dicks Creek
Pond.
(C) The Applicant shall within six months following its acceptance of the New License,
consult with the Wildlife Resources Commission (NCWRC), NCDWR, NCDWQ, US
Fish & Wildlife Service (USFWS) and the US Forest Service (USFS) and file a plan
("Minimum Flow Plan") for NCDWQ approval to modify project facilities to:
1) maintain the existing minimum flow valve capable of releasing up to 8 cfs, as
calibrated and metered at the valve, from the Whiteoak Creek Penstock into
Dicks Creek;
2) install an additional minimum flow valve capable of releasing up to 8 cfs, as
calibrated and metered at the valve, from the Whiteoak Creek Penstock into
Dicks Creek; and
3) install a minimum flow device capable of releasing up to eight cfs, as
calibrated and metered at the device, from the Whiteoak Creek Diversion Dam
into Whiteoak Creek.
4) Within one year following NCDWQ approval of such plan, the Applicant
shall complete the modifications of project facilities identified in the plan and
begin providing the minimum flows as specified in this condition.
(D) The Applicant may temporarily vary from the minimum flows identified in Paragraph
(A) if required by conditions beyond the Applicant's control or by operating emergencies
or maintenance needs as defined in Settlement Agreement Attachments B and C. Such
temporary variances shall be in accordance with the Low Inflow Protocol or the Hydro
Project Maintenance & Emergency Protocol, incorporated by reference into this
certificate as Settlement Agreement Attachments B and C, respectively.
(E) The Applicant shall calibrate the meters used to monitor minimum flows within 60
days following installation of the additional minimum flow valve and device identified in
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification
this condition and at least once every two years thereafter.
(F) The Applicant shall continue providing each minimum flow for each release point as
specified by the current FERC license, even after expiration of the current license, until
the new minimum flow, pursuant to the New License, for any specific release point is
required to be implemented under terms of the New License.
4.0 Scheduled High Flow Releases to Nantahala Bypassed Reach
(A) Beginning at the later of (1)(a) upon submittal to the Applicant of a written and
complete traffic management plan developed by the USFS and (b) completion of
construction of the improved parking areas immediately above and below the Cascades
section near River Mile 16.5 on the Nantahala River Bypassed Reach, or (2) within one
year following its acceptance of the New License, the Applicant shall provide the
following high flow schedule using a Tainter Gate at Nantahala Dam, except during
periods of temporary variance as noted herein. The target flows and times are for flows
and flow arrival times immediately below the confluence of Whiteoak Creek with the
Nantahala River. Actual release amounts from the Tainter gates need to be large enough
that when combined with other tributary and accretion flows, the total is at or above the
approximate target flow rates.
6
When Dates Target Flow Hrs Times

One Spring 250 6 10 am to
Saturday One Weekend Between 4 pm
One Spring April 15 and 30 350 6 10 am to
Sunday 4 m
250 3 4 pm to 7
pm
250 3 4 pm to 7
Four Summer Between pm
Afternoons June 15 and August 31 250 3 4 pm to 7
pm
250 3 4 pm to 7
pm
300 7 10 am to
One Fall Saturday One Weekend 5 pm

Between September 15 425 5 10 am to
One Fall Sunday and 30 250 2 3 pm
(These flows are to occur 3 pm to 5
as a single event) pm
Letter from J. Mead to J. Dorney, 5/28/10 7
Duke Nantahala 401 Certification
(B) The Applicant may temporarily vary from the high flow releases from Nantahala
Dam as identified above if required by conditions beyond the Applicant's control or by
operating emergencies or maintenance needs as defined in Settlement Agreement
Attachments B and C. Such temporary variances shall be in accordance with the Low
Inflow Protocol or the Hydro Project Maintenance & Emergency Protocol, incorporated
into this certificate by reference as Settlement Agreement Attachments B and C,
respectively.
(C) During the first two years of high flow releases in the Nantahala River Bypassed
Reach, the USFS, NCWRC, NCDWR and the USFWS will monitor the existing fishery
in the Nantahala River Bypassed Reach and identify any significant adverse impacts to
fisheries caused by these high flow releases. In October after the first and second seasons
of releases, the Applicant shall convene a meeting with American Whitewater (AW),
Carolina Canoe Club (CCC), Nantahala Gorge Association (NGA), Trout Unlimited
(TU), USFS, NCWRC, USFWS, and NCDWR to discuss any proposed changes that are
based on the monitoring results.
5.0 Other Resource Enhancements
Duke Power Nantahala Area (DPNA) hydro projects refers to the Nantahala, East and
West Fork Tuckasegee, Mission, Bryson, and Franklin hydroelectric projects.
(A) The Applicant shall provide a one-time funding contribution, in-kind services or a
combination of the two, at the Applicant's option, not to exceed a total cost of $40,000 to
support USFWS and NCWRC studies to determine the range and distribution of the
sicklefin redhorse in the Little Tennessee, Hiwassee and Tuckasegee Rivers.
(B) The Applicant shall provide a one-time funding contribution, in-kind services or a
combination of the two, at the Applicant's option, not to exceed a total cost of $40,000 to
support a project by the USFWS, NCWRC and the USFS to restore the native strain of
brook trout to a selected stream in the vicinity of the Tennessee Creek Hydro Station.
(C) The Applicant shall within 1 to 15 years following its acceptance of the new licenses
for the DPNA Hydro Projects, provide Cherokee, Clay, Jackson, Macon and Swain
counties $40,000 each to implement the Applicant-selected initiatives from a prioritized
list identified by each county's Soil and Water Conservation District board as of July 1,
2005 that (1) make physical improvements that protect soil or water resources, (2)
educate landowners or school children on proper soil or water conservation practices,
and/or (3) improve soil or water conservation programs that affect lands that drain to any
of the DPNA Hydro Projects or the river sections between the DPNA Hydro Projects and
reservoirs belonging to the Tennessee Valley Authority (TVA).
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification
(D) The Applicant shall within 1 to 15 years following its acceptance of the new licenses
for the DPNA Hydro Projects, provide a total of $200,000 for the purpose of supporting
Applicant-selected riparian habitat enhancement projects on lands that drain to any of the
DPNA Hydro Projects or the river sections between the DPNA Hydro Projects and
reservoirs belonging to the Tennessee Valley Authority (TVA) where such projects (1)
protect or enhance fish or wildlife habitat directly or (2) educate landowners or school
children about the importance of healthy riparian areas for fish and wildlife habitat. The
Applicant will utilize the process outlined in the Attachment I of the Settlement
Agreement in selecting the projects to be funded.
(E) For the purposes of Paragraphs (A) through (D) above, the contribution amounts
required therein represent the total amount for which the Applicant is liable pursuant to
these paragraphs, notwithstanding that identical language may appear in the certificates
for the West Fork and East Fork projects (FERC Project Nos. 2686 and 2698,
respectively). For the purpose of construing these paragraphs, the identical Paragraphs
(A) through (D) may have been included in the certificates for FERC Project Nos. 2686,
and 2698 for informational purposes and not to provide for cumulative obligations.
6.0 Shoreline Management
(A) The Applicant shall implement its Shoreline Management Program including the
Shoreline Classification Maps, Lake Use Restrictions, Vegetation Management
Requirements and the Shoreline Management Guidelines as filed with its license
application to aid the Applicant in its lake use permitting program.
(B) The Applicant shall, upon issuance of this certificate, provide support to others that
may organize an annual "Reservoir-Wide Clean Up" on Nantahala Lake by removing
collected trash during the week following the clean-up from pre-designated collection
sites around the reservoir.
7.0 Sediment Management
(A) The Applicant shall operate the Nantahala Project so as to minimize the need to draw
the reservoirs down to mechanically remove sediment. When sediment must be
mechanically removed, or the reservoirs must be drawn down, the Applicant shall consult
and reach agreement with the NCWRC, USFWS, USFS, NCDWR, USACOE (United
States Army Corps of Engineers) and the NCDWQ concerning any reasonable and
necessary measures to minimize the impact of the drawdown and sediment removal on
the affected environment. This consultation and measures identification shall be
completed prior to operating in any way that would be expected to allow sediment from
Letter from J. Mead to J. Dorney, 5/28/10 9
Duke Nantahala 401 Certification
upstream of the Nantahala Dam, Whiteoak Creek Diversion Dam, Diamond Valley
Diversion Dam or Dicks Creek Diversion Dam to enter the downstream reaches.
8.0 Monetary Value Calculations
(A) Unless otherwise indicated, all costs or payment amounts specified in dollars in
conditions 1 through 7 of this certificate shall be deemed to be stated as of the year 2004,
and the Applicant shall escalate such sums as of January 1 of each following year
(starting in January 2005) according to the following formula:
AD=Dx GDP
IGDP
WHERE:
AD = Adjusted dollar amount as of January 1 of the year in which the
adjustment is made.
D = Dollar amount prior to adjustment.
IGDP = GDP-IPD for the third quarter of the year before the previous adjustment
date (or, in the case of the first adjustment, the third quarter of the year
before the effective date of the New License).
NGDP = GDP-IPD for the third quarter of the year before the adjustment date.
"GDP-IPD" is the value published for the Gross Domestic Product Implicit Price Deflator
by the U.S. Department of Commerce, Bureau of Economic Analysis in the publication
Survey of Current Business, Table 7.1 (being on the basis of 1987 = 100), in the third
month following the end of the applicable quarter. If that index ceases to be published,
any reasonably equivalent index published by the Bureau of Economic Analysis may be
substituted. If the base year for GDP-IPD is changed or if publication of the index is
discontinued, the Applicant shall promptly make adjustments or, if necessary, select an
appropriate alternative index to achieve the same economic effect.
9.0 Compliance Monitoring and Reporting Requirements
(A) Beginning in the first calendar year after its acceptance of the New License, the
Applicant shall provide annually to the NCDWR, NCWRC, USFWS and USFS and shall
file with NCDWQ, not later than May 31, a report containing: (1) a table of the elevation
of Nantahala Lake on a daily basis during the previous calendar year, (2) certification by
the Applicant that the minimum flow release requirements of condition 3.0 were met
during the previous calendar year, and (3) certification by the Applicant that the
Letter from J. Mead to J. Dorney, 5/28/10
Duke Nantahala 401 Certification
10
scheduled high flow release requirements from the Nantahala Dam of condition 4.0 were
met during the previous calendar year.
(B) If during the previous calendar year there were any deviations of reservoir levels
above or below the Normal Operating Range (condition 1.0), the minimum flow release
requirements (condition 3.0), or the high flow release requirements from the Nantahala
Dam (condition 4.0), then the Applicant shall include in the report described in Paragraph
(A) above an explanation of each incident during the previous calendar year when the
deviations occurred, together with information sufficient to explain the reasons for each
such incident.
Settlement Agreement Attachments Incorporated by Reference
B. - Low Inflow Protocol (LIP) for the Nantahala Project
C. - Hydro Project Maintenance & Emergency Protocol (HPMEP) for the Nantahala
Proj ect