The Federal Energy Regulatory Commission (FERC) has cancelled a preliminary permit issued to Hydro Development, LLC in August 2013 to study the feasibility of a hydroelectric power project at Swan Lake and Cascade Creek, located 15 miles northeast of Petersburg near Thomas Bay. FERC issued the order to cancel on March 17 after the Bellingham-based company failed to submit a progress report.

The preliminary permit granted by FERC gave Hydro Development, LLC priority to submit a license application for the project. Their 2012 application for the permit said, “Hydro Development LLC proposes...