20150521-5049(30599949)

UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
Duke Energy Carolinas, LLC
Project No. 2503 -154
Keowee - Toxaway Hydroelectric Project
REPLY COMMENTS OF
DUKE ENERGY CAROLINAS, LLC
TO COMMENTS AND RECOMMENDATIONS
Pursuant to Section 5.23(a) of the regulations of the Federal Energy Regulatory Commission
(FERC)' and in accordance with the FERC's February 5, 2015, Notice of Application Accepted for
Filing, Soliciting Motions to Intervene and Protests, Ready for Environmental Analysis, and Soliciting
Comments, Recommendations, Preliminary Terms and Conditions, and Preliminary Fishway
Prescriptions (REA Notice), Duke Energy Carolinas, LLC (Duke Energy), licensee for the Keowee-
Toxaway Hydroelectric Project, FERC Project No. 2503 (Project), hereby responds to comments and
recommendations filed in response to Duke Energy's Application for New Licensee and Relicensing
Agreement . 3
Duke Energy consulted extensively with federal and state resource agencies, local governments,
water suppliers, homeowners associations, environmental organizations and others (Stakeholder Team)
' 18 CY R § 5.23(a)
2 Final License Application for the Keowee - Toxaway Project, No. 2503, filed August 27, 2014 (License
Application)
3 Relicensing Agreement for the Keowee - Toxaway Project (filed with the License Application, Exhibit E,
Appendix E -1)

during the relicensing process .4 In November 2013, Duke Energy and all sixteen other organizations on
the Stakeholder Team eligible to do so, signed the Relicensing Agreement, signifying agreement on the
resolution of all material resource matters associated with the New License. The Relicensing Agreement
identifies all protection, mitigation, and enhancement (PM &E) measures the signatories to the
Relicensing Agreement (Parties) believe should be included in the New License as proposed License
Articles,5 additional measures the Parties believe should be handled off - License, and obligations of the
Parties during the remainder of relicensing and the term of the New License. The Relicensing
Agreement also includes provisions for addressing the inclusion of any requirements in the New License
inconsistent with the Relicensing Agreement ( "Inconsistent Acts ") when such requirements would
increase the burden upon any Party or reduce the benefits any Party was afforded by the Relicensing
Agreement. Therefore, the Parties request in the Relicensing Agreement that the FERC and other
agencies act in a manner consistent with the measures contained in the Relicensing Agreement.
The License Application, including the Historic Properties Management Plan, Recreation
Management Plan, and Shoreline Management Plan submitted with the License Application 6, is
consistent with the Relicensing Agreement. The License Application is also consistent with the
Operating Agreement executed on October 17, 2014, by the United States of America acting by and
through the Savannah District, USACE, Southeastern Power Administration (SEPA), and Duke Energy
(New Operating Agreement) .7 When taken as a whole, the proposed PM &E measures address Project-
4 The following organizations were members of the Stakeholder Team: Duke Energy, Advocates for Quality
Development, Inc. (AQD); Anderson Area Chamber of Commerce; City of Seneca; Commissioners of Public Works
of the City of Greenville (Greenville Water); Friends of Lake Keowee Society, Inc. (FOLKS); Oconee County,
South Carolina (SC); Pickens County, SC; Pickens County Water Authority; SC Department of Archives and
History (SCDAH); SC Department of Natural Resources (SCDNR); SC Department of Parks, Recreation, and
Tourism (SCDPRT); SC Wildlife Federation (SCWF); The Cliffs at Keowee Vineyards Community Association,
Inc.; The Reserve at Lake Keowee; Upstate Forever; and Warpath Development, Inc. The SC Department of Health
and Environmental Control; US Army Corps of Engineers (USACE); and US Fish and Wildlife Service (USFWS)
also participated in Stakeholder Team meetings as Special Participants with the stated understanding they would
likely be unable to enter into an agreement due to regulatory constraints and obligations.
5 Relicensing Agreement, Appendix A
6 License Application, Exhibit E, Appendices E -3, E -4, and E -5, respectively
7 The New Operating Agreement was submitted to the FERC on November 6, 2014. It replaces a similar
agreement dating to 1968 developed in accordance with Article 32 of the Existing License.
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related resource effects while also providing additional off - license benefits of value to the Parties.
Respecting the years of effort by the Stakeholder Team to resolve the many resource interests associated
with Project relicensing, Duke Energy is responding to comments that, if accepted by the FERC and
incorporated into the New License, could result in Inconsistent Acts that "unbalance" the Relicensing
Agreement and its provisions.
I. General Comments
Most comments submitted to the FERC in response to the REA Notice were supportive of Duke
Energy's proposed PM &E measures, the License Application, and the Relicensing Agreement. 8 Duke
Energy appreciates the letters of support submitted by many Parties to the Relicensing Agreement. These
letters demonstrate the on -going commitment of the Parties to the Relicensing Agreement, a commitment
developed through years of consultation and negotiation by the Stakeholder Team.
II. Response to Comments Inconsistent with the Relicensing Agreement
A. The FERC Should Not Adopt the Fish Entrainment Measures Recommended by the United
States Department of Interior (USDOI)
In conjunction with Project relicensing, Duke Energy conducted an entrainment study at Jocassee
Pumped Storage Station.9 As described extensively in the License Application10, fish entrainment at
Jocassee Pumped Storage Station during the twelve -month study period was conservatively estimated
(i.e., overestimated) to be a total of 13,253 (conventional generation) and 24,328 (pump back operations)
fish susceptible to turbine- induced mortality with non -game species blueback herring and threadfin shad
comprising the bulk of fish affected by entrainment. These entrainment levels represented approximately
8 The following Parties to the Relicensing Agreement submitted letters supporting the License Application and
Relicensing Agreement: AQD on March 13, 2015; FOLKS on March 28, 2015; Greenville Water on March 31,
2015; Oconee County, SC on March 17, 2015; SCDNR on March 20, 2015; SCDPRT on March 13, 2015; SCWF on
March 20, 2015; Upstate Forever on March 18, 2015; Warpath Development, Inc. on March 30, 2015.
9 See "Fish Community Assessment Study FERC Required Fish Entrainment Modification" dated October 2013
in Appendix E6 of Exhibit E of the License Application.
10 See License Application, Exhibit E, Section E3.4.2.3.
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0. 15 percent and 0.74 percent of the forage fish populations present in Lake Jocassee and Lake Keowee,
respectively, based on 2012 fall and 2013 spring population estimates. Given the over estimation of fish
mortality associated with entrainment, the dominance of forage -based species entrained, and the relatively
small percentage of the entire fishery estimated to be subject to turbine- induced mortality, clearly fish
entrainment is not adversely affecting the overall fishery at Lake Jocassee or Lake Keowee. In fact, data
presented in the Final License Application indicate forage fish (i.e., non -game species) population levels
are more directly correlated with environmental factors such as winter severity, nutrient loading, and
predator abundance than Jocassee Pumped Storage Station operations. Based on the overwhelming
empirical data to support the fact that fish entrainment is not adversely affecting the fisheries in Lakes
Keowee and Jocassee, Duke Energy believes no PM &E measures are needed to address any fish
entrainment as a Project effect.
However in the interest of developing a comprehensive settlement agreement, organizations on
the Stakeholder Team negotiated for measures to further reduce already low levels of fish entrainment."
These measures include modifications to lighting at the forebay of Jocassee Pumped Storage Station in
Lake Jocassee and its tailwater in Lake Keowee and a preferred hydro unit pumping sequence during
pump back operations, when such unit sequencing is practicable. Duke Energy agreed to incorporate
such measures in the Relicensing Agreement, but, with the consensus of the Parties to the Relicensing
Agreement, agreed to implement them as off - license measures as opposed to FERC- required measures.
In its comments, the USDOI recommends the fish entrainment measures included in the
Relicensing Agreement be required in the New License. 12 Duke Energy does not agree inclusion of these
entrainment measures into the New License is appropriate. As explained in Duke Energy's response to
Relicensing Agreement Section 8.5.3
lz See "Comments and Recommendations for the Review of Application Accepted for Filing, Ready for
Environmental Analysis for the Keowee - Toxaway Hydroelectric Project FERC #P- 2503 -154" (filed April 3, 2015)
4

FERC staff's Additional Information Request 13, the Lighting Modification Plan (Plan) will be consistent
with FERC Public Safety Guidelines at Hydropower Projects and subject to jurisdiction by the FERC's
Division of Dam Safety's Atlanta Regional Office, so inclusion of the measure in the New License is
unnecessary. Further, even though the USFWS is not a signatory to the Relicensing Agreement, Duke
Energy is required per the terms of the Relicensing Agreement to consult with both the SCDNR and the
USFWS in developing the Plan. Thus, there is already the opportunity for any resource -based interests
the USFWS may have in implementing this off - license measure to be provided to and considered by Duke
Energy.
The hydro unit start-up sequence may be modified by Duke Energy as needed based on unit
condition and availability without notification or consultation, so analysis of the effects of such a measure
would be highly speculative. Further, demonstrating compliance with such a qualitative measure as
would likely be required in a New License would be burdensome and above and beyond the obligations
Duke Energy has agreed to in the Relicensing Agreement.
Given such measures are unnecessary for mitigating Project effects and requiring them in the
New License could unnecessarily create an unwarranted burden for Duke Energy, Duke Energy
respectfully requests the FERC accede to the expressed unanimous desire of the Parties to the Relicensing
Agreement that the fish entrainment measures not be required in the New License. Further, inclusion of
such requirements would be inconsistent with FERC policy given there are no demonstrated adverse
effects to fish populations associated with entrainment. 14
13 Additional Information Request (issued October 20, 2014); Duke Energy's response: Keowee - Toxaway
Hydroelectric Project (FERC No. 2503 -154) Response to FERC's October 20, 2014, Additional Information
Requests for the Final Application for New License (submitted December 17, 2014)
14 See 16 U.S.0 § 8251(b) (2006) requiring the FERC's licensing orders to be supported by "substantial evidence."
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B. Additional Monitoring Associated with the Proposed Fish Entrainment Measures is Not
Needed.
In its comments recommending inclusion of the Relicensing Agreement fish entrainment
measures in the New License, USDOI expands the scope of measures beyond those included in the
Relicensing Agreement.15 Specifically, USDOI recommends the potential inclusion of additional
evaluations of the efficacy of the hydro unit start-up sequence during pump back operations and
monitoring of reservoir and tributary fish communities to identify possible Project effects.
As discussed above, the relatively low level fish entrainment associated with Jocassee Pumped
Storage Station was not found to be adversely affecting reservoir fisheries. In conjunction with the
entrainment study, Duke Energy conducted an in -field assessment of the effects of modifying its hydro
unit start-up sequence during pump back operations and, based upon the assessment, believes such a start-
up sequence may further reduce the already low level of entrainment. However, given entrainment is not
adversely affecting reservoir fisheries and the in -field assessment indicates these small amounts of
entrainment would likely be further reduced, such a monitoring effort would be an undue and unnecessary
burden.
The recommendation for additional reservoir and tributary fishery monitoring is completely
unwarranted. As discussed above and extensively in the License Application, there are no demonstrated
adverse effects on fishery populations associated with Project operations. Further, there is absolutely no
nexus between tributary fish monitoring and Project operations as there have been no demonstrated
Project effects on tributary fish populations. The fish entrainment study conducted for relicensing not
only evaluated entrainment through in -field monitoring, but also analyzed fifteen years of fishery
monitoring data Duke Energy has collected. Considering the lack of demonstrated adverse effects
resulting from fish entrainment and volumes of existing information demonstrating the presence of high
15 See USDOI comments, pp 9 -10.
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quality fishery resources within the watershed, the request to include these additional requirements in the
New License amounts to nothing more than an attempt to require the Licensee to undertake research.
Given the resources expended prior to and during the relicensing to monitor fishery resources at
the Project and the lack of evidence demonstrating adverse effects associated with Project operations,
inclusion of such requirements in the New License would not address any identified Project effects,
would be inconsistent with FERC policy, and would create an undue burden on Duke Energy. Such
requirements would also be inconsistent with the Relicensing Agreement and potentially jeopardize the
balance of resource measures reflected in the Relicensing Agreement. Therefore, Duke Energy
respectfully requests such measures not be required in the New License.
C. The FERC Should Not Restrict Lake Keowee's Minimum Reservoir Elevation to 793 feet
(ft) above mean sea level (AMSL).
Three individuals submitted comments in opposition to Duke Energy's proposed minimum
reservoir elevation at Lake Keowee of 790 ft AMSL.16 °17 All three commenters neglect to acknowledge
the most salient point that the minimum reservoir level at Lake Keowee during normal (i.e., non - drought
and non - emergency) conditions would be 796 ft AMSL; only during the most severe stage of the Low
Inflow Protocol (LIP)18 would Lake Keowee be allowed to fall to 790 ft AMSL and even under such
extreme conditions, Lake Keowee would be maintained at or above 791.5 ft AMSL for as long as
16 Douglas Barker (submitted March 17, 2015); Ronald Davis (submitted March 17, 2015); James Vaughan
(submitted March 17, 2015)
17 Mr. Barker also states in his comments that property owners at Lake Keowee were denied an opportunity to
participate on the Stakeholder Team. In actuality, property owner interests at Lake Keowee were represented by a
number of Stakeholder Team member organizations including, among others, The Reserve at Lake Keowee and The
Cliffs at Keowee Vineyards Community Association, Inc., both of which are also Parties to the Relicensing
Agreement. Mr. Barker did not communicate with Duke Energy regarding Project relicensing or express interest in
participating on the Stakeholder Team until 2013, more than four years after the Stakeholder Team began its efforts.
Of the 45 Stakeholder Team meetings held to date, Mr. Barker attended only one meeting. Stakeholder Team
meetings were open to the public and included time for non -Team Members to address the Stakeholder Team during
which Mr. Barker could have represented his or other property owner interests.
18 The LIP is in Appendix D of the Relicensing Agreement. It identifies five Stages of low inflow conditions and
the responsibilities of the Relicensing Agreement Parties in each LIP Stage.
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possible. 19 These commenters also fail to acknowledge the competing issues that led the Stakeholder
Team to recommend the LIP and its operating levels.
The Stakeholder Team evaluated many operating alternatives during Project relicensing,
recognizing the need to appropriately balance Project reservoir interests, hydropower production,
environmental considerations, and downstream interests.20 Ultimately, the Parties to the Relicensing
Agreement determined the normal minimum reservoir elevation at Lake Keowee should be raised from
775 ft AMSL to 796 ft AMSL. However, during LIP stages, the Parties agreed to a gradual lowering of
both Lake Keowee and Lake Jocassee reservoir elevations to minimize effects on Project reservoir
resources for as long as possible while continuing to provide downstream flow releases to support
downstream resource needs. This operating protocol appropriately recognizes that the Keowee - Toxaway
Project is part of the larger Savannah River Watershed and that its water resources are a shared resource.
Further, Project operations as described in the Relicensing Agreement are also consistent with the New
Operating Agreement. Therefore, Duke Energy respectfully requests the FERC accept the operating
protocols contained in the Relicensing Agreement without material modification and incorporate such
measures in the New License.
With respect to the assessment of economic effects of reduced Lake Keowee elevations by Dr.
David Wyman, Duke Energy provided written comments on the preliminary draft paper to Dr. Wyman.
The document filed by Mr. Barker appears to be the same preliminary draft originally reviewed and
commented on by Duke Energy and we are unable to locate a final version to evaluate whether or not
Duke Energy's comments21 were ultimately addressed. Regardless, Duke Energy provided information in
the License Application regarding the economic effects of proposed Project operations and finds no
19 See LIP Stage 4 actions, 8.a.
20 See the discussion of operations modeling in following sections of the License Application, Exhibit E:
Appendix E -6, "Operations Model Verification Report" and "Operations Model Study Report;" Appendix E -7.6
Stakeholder Team Consultation Record; Appendix E -7.12 Water Quantity and Operations Resource Committee
Consultation Record.
21 See "The Impact of Climate Change on Property Value: A Tale of Two Lakes Duke Energy Comments" (dated
June 11, 2013) in License Application, Exhibit E, Appendix E -7.1.
E.3

evidence to support an assertion that proposed Project operations will adversely affect property values or
the regional economy.22
III. Conclusion
WHEREFORE, for the foregoing reasons, the FERC should: (1) issue a New License for the
Project which incorporates the Proposed License Articles as included in the Relicensing Agreement
without material modification; and (2) reject all recommendations and proposed license conditions that
are inconsistent with the Relicensing Agreement.
Respectfully submitted,
/s/ Garry S. Rice
Garry S. Rice
Deputy General Counsel
Duke Energy Corporation
550 S Tryon St.
Mail Code DEC45A
Charlotte, North Carolina 28202
Telephone: [phone]
E -mail: Garry.Rice @duke - energy.com
Dated: May 21, 2015
22 See: License Application, Exhibit E, Section E3.10.2 and "An Economic Analysis of Low Water Levels in
Hartwell Lake" (November 8, 2010); "Regional Economic Analysis of Changing Lake Levels in Lake Keowee"
(October 28, 2011); "Regional Economic Analysis of Changing Lake Levels in Lake Thurmond" (December 19,
2011) in License Application, Exhibit E, Appendix E -8 (Appendices P, R, and S, respectively).
N

UNITED STATES OF AMERICA
BEFORE THE
FEDERAL ENERGY REGULATORY COMMISSION
Duke Energy Carolinas, LLC ) Project No. 2503 -154
Keowee - Toxaway Hydroelectric Project
CERTIFICATE OF SERVICE
I hereby certify that on this 21st day of May, 2015, these Reply Comments for Duke
Energy Carolinas were electronically filed with the Federal Energy Regulatory Commission and
by email to each person designated on the Service List compiled by the Commission Secretary
for this project.
Dated: May 21, 2015
10
/s/ Garry S. Rice
Garry S. Rice
Deputy General Counsel
Duke Energy Corporation
550 S Tryon St.
Mail Code DEC45A
Charlotte, North Carolina 28202
Telephone: [phone]
E -mail: Garry.Rice @duke - energy.com