Below is the LIHI Fee Structure. These rates are effective January 1, 2015 through December 31, 2019.
In 2020, five years after the current rates were set, the annual fee base rate and market rates will increase by 10%. Thereafter, these fees will increase by 2% per year.
The Maximum Fee will also increase by 10% in 2020.
All application fees, condition fees and minimum fees will not change.
LIHI Fee Structure Overview
The fees that LIHI charges to Certificate applicants and holders include fees associated with application review as well as annual fees to maintain an active LIHI Certificate. There are three parts of the LIHI Application Process, each involving a separate fee component. Part 1 consists of an initial Intake Review, which allows the applicant to submit a questionnaire and receive a preliminary non-published review of the facility as well as a cost estimate to proceed with a formal LIHI application. Part 2 is the formal LIHI application, which is published for a 60-day public comment period. The date that a full application (complete application and fee) is received becomes the Certificate Effective date if the Certificate is issued. Applications are posted for public comment as soon as possible after receipt of the full application. Part 3 is the review of an application for additional terms, referred to as Recertification. Typically, the term of a LIHI certificate is five years, although there are opportunities for longer terms under certain conditions. Approximately six months prior to the expiration of the term, the facility owner is invited to apply for Recertification.
Intake Review Fees
Intake Reviews are Part 1 for first time applicants. This is a flat rate as published above.
Formal Application Review Fees
The fee charged for the full application for LIHI Certification will be calculated during the intake review process. The review fee is a combination of the Reviewer cost estimate plus LIHI overhead.
Recertification Review Fees
All facilities seeking to renew their Low Impact Certification are subject to a Recertification review fee. The Recertification review fee includes an initial flat fee of $2,000 to cover the first stage of the Recertification application review (Stage I). If the LIHI criteria have changed or there have been material changes at the facility since the last certification, Recertification applicants will go through a Stage II review. The result of the Stage I review will be an intake review report on the initial recertification application, accompanied by an estimate of the incremental cost for completing the recertification application review, in addition to the initial $2,000 fee. The incremental cost will be very application-specific, ranging from zero to several times the initial recertification fee. Depending on the completeness of the initial recertification application, the incremental review cost will vary.
Annual fees are based on the average annual generation (AAG) of the certified facility multiplied by a $/MWh rate. LIHI will bill all certified facilities an annual fee for each year of the certificate term, including the year in which a facility applies for re-certification. Annual fees are retroactive. For example, if a Certificate’s effective date is July 1, 2018, the first annual fee will be invoiced in June of 2019 covering the period from July 2018 to June 2019.
The annual fee rate for each certified facility will vary according to the facility market-participation category. LIHI has created two market participation categories: Verified-Market Participants (VMP) and Base Fee. VMP facilities are those that are publicly listed as a supplier of eligible generation for a state Renewable Portfolio Standard (RPS) program, a Renewable Energy Standard (RES) program, or other similar policy which utilizes the LIHI Certification standard as part of compliance. In addition, LIHI certified facilities generating Green-e certified products will be included in the VMP category. All other certificates will be included in the Base Fee category.
Verified-Market Participants will be charged according to the rate schedule published above.
Only the portion of generation that qualified for the RPS or similar program will be charged at the VMP rates above.
The Base Fee category rate applies to all other LIHI certified projects and, in those instances where only a portion of the generation is eligible for market participation, to the balance of the generation that is not included in the VMP rate.
There is a minimum and maximum fee as posted above.
Active Condition Fee
LIHI Certifications may be issued with facility-specific conditions, to which the Certified Project owner must demonstrate compliance. An Active Condition Fee may be charged for each of these facility-specific conditions for each year the condition remains active. Condition fees are also retroactive and billed with the annual fee. The purpose of condition fees is to recover the cost to LIHI associated with monitoring compliance with active conditions. The fee will range between $0 and $1,000 per condition per year and will be assigned by LIHI according to the complexity of the condition and necessary monitoring and follow up.
We welcome questions or comments on this new fee structure at any time. Visit our Contact Us page on our website for how to reach us.
History of the Fee Structure
Until 2014, LIHI had not significantly altered the Certification Program fee structure since its inception in 1999, even though the program had expanded significantly. At that time, LIHI had issued 116 certificates since 1999, totaling close to 5.8 GW of installed capacity. From 2012 to 2014, the Governing Board studied the effectiveness of the fee structure and determined that it did not adequately recover the costs of operating our certification program. This problem related in part to the large number of small facilities that applied for LIHI certification. Managing the program and providing services that enhance the value of the LIHI Certificate requires a consistent and predictable revenue stream that can attract and maintain qualified professional staff and consistently return value to all stakeholders. Adequate revenue is necessary to improve value to LIHI certificate holders by allowing staff necessary resources to work to expand the visibility and recognition of the LIHI brand and expanding the markets where LIHI Certificates are recognized.
The changes to the LIHI Certification Program fee structure were designed to allow LIHI to better serve our certification partners, to recover the costs of certifying hydropower facilities of all sizes and create more transparency between costs and fees, to engage in public discussion of the role of hydropower in renewable markets, and to move the Institute into a stronger, more sustainable financial position. The new fee structure was also designed to better align fees with the value that LIHI Certified® facilities realize when they participate in the renewable markets of today. The fee changes were also sensitive to the challenges some certified facilities face in attempting to monetize the benefits of the LIHI Certificate.
The process of revising the fee structure included outreach to a representative sampling of current LIHI Certificate holders, as well as expertise and guidance provided by our Renewable Market and Hydropower Industry advisory panels. The outreach process began in the spring of 2014, and the revision underwent a series of modifications that were responsive to the suggestions offered from stakeholders.