On Friday, July 15, 2016, President Obama signed into law a short-term Federal Aviation Administration (FAA) reauthorization measure that includes several drone-related provisions aimed specifically at utilities. The provisions should allow broader use of drones by utilities, beyond what is authorized by FAA’s recent rule on commercial small drone operations, and should help utilities to protect critical facilities from unwanted and potentially harmful intrusion by drones.

First, the new law contemplates an FAA exemption process to facilitate operation of beyond-visual-line-of-sight, daytime or nighttime drone flights for certain specified activities relating to critical infrastructure. Those activities generally include ensuring compliance with applicable law or industry best practices; inspecting, repairing, constructing, maintaining, or protecting covered facilities; and responding to or preparing for a natural or man-made disaster, severe weather event, or similar incident that might cause material damage to a covered facility. The term “covered facility” explicitly includes pipelines, electric generation, transmission or distribution facilities, and oil or gas production, refining or processing facilities.

Second, the new law instructs FAA to enter agreements with the Department of Energy (DOE), the Federal Emergency Management Agency (FEMA), and other agencies as needed to facilitate expeditious authorization of drone operations to support utility service restoration. “Utility” is undefined, except that the provision makes clear that at a minimum the term includes any person that sells electric energy.

Third, the law requires FAA to publish guidance within 90 days regarding emergency processing of requests for authorization to operate drones in response to a catastrophe, disaster or other emergency, including for utility and infrastructure restoration efforts. The guidance must outline procedures for obtaining such emergency authorization. The guidance must also: (i) specify any safety requirements that must be met for considering applications for beyond-line-of-sight or nighttime operations, or the suspension of otherwise applicable operating requirements; and (ii) explicitly outline the procedures (if any) for coordinating with the incident commander to ensure non-interference with emergency response efforts. FAA is instructed to process such applications as expeditiously as practicable and without requiring public notice and comment.

Fourth, the law directs FAA to establish, within six months, a process under which applicants may petition FAA to create a no-drone zone, or a drone-restricted zone, around their fixed site facility. Fixed site facilities are expressly defined to include critical infrastructure such as energy production, transmission and distribution facilities.

Next Steps
At this stage, utility companies should position themselves to take advantage of the new rules for commercial operation of small drones that will take effect in late August and the new, broader provisions in the FAA reauthorization measure once they are finalized. We will continue to follow the developments from the FAA, including the potential FAA exemption process; the pending agreements with the DOE, FEMA, and other agencies; the pending guidance for authorization requests related to emergency response operations; and the process to petition for no-drone and drone-restricted zones and will advise of new developments as they arise.