Hydroelectric Licensing Process Improvement Act of 1998

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Hydroelectric Licensing Process 
Improvement Act of 1998''.

SEC. 2. FINDINGS.

    Congress finds that--
            (1) hydroelectric power is an irreplaceable source of 
        clean, economic, renewable energy with the unique capability of 
        supporting reliable electric service while maintaining 
        environmental quality;
            (2) hydroelectric power is the leading renewable energy 
        resource of the United States;
            (3) hydroelectric power projects provide multiple benefits 
        to the United States, including recreation, irrigation, flood 
        control, water supply, and fish and wildlife benefits;
            (4) in the next 15 years, the bulk of all non-Federal 
        hydroelectric power capacity in the United States is due to be 
        relicensed by the Federal Energy Regulatory Commission; and
            (5) the process of licensing hydroelectric projects by the 
        Commission--
                    (A) has become inefficient, because Federal 
                agencies that participate in the process are not 
                required to submit their mandatory and recommended 
                conditions to the license by a time certain; and
                    (B) does not produce optimal decisions, because the 
                agencies are not required to consider a broad range of 
                factors in determining those conditions.

SEC. 3. PURPOSE.

    The purpose of this Act is to improve the hydroelectric licensing 
process by--
            (1) authorizing the Federal Energy Regulatory Commission to 
        impose deadlines by which Federal agencies must submit proposed 
        mandatory and recommended conditions to a license;
            (2) requiring the agencies to consider a broad range of 
        factors in determining those conditions and to document the 
        consideration of those factors; and
            (3) making other improvements to the licensing process.

SEC. 4. PROCESS FOR CONSIDERATION BY FEDERAL AGENCIES OF CONDITIONS TO 
              LICENSES.

    (a) In General.--Part I of the Federal Power Act (16 U.S.C. 791a et 
seq.) is amended by adding at the end the following:

``SEC. 32. PROCESS FOR CONSIDERATION BY FEDERAL AGENCIES OF CONDITIONS 
              TO LICENSES.

    ``(a) Definitions.--In this section:
            ``(1) Condition.--The term `condition' means--
                    ``(A) a condition to a license for a project on a 
                Federal reservation determined by a consulting agency 
                for the purpose of the first proviso of section 4(e); 
                and
                    ``(B) a prescription relating to the construction, 
                maintenance, or operation of a fishway determined by a 
                consulting agency for the purpose of the first sentence 
                of section 18.
            ``(2) Consulting agency.--The term `consulting agency' 
        means--
                    ``(A) in relation to a condition described in 
                paragraph (1)(A), the Federal agency with 
                administrative jurisdiction over the reservation; and
                    ``(B) in relation to a condition described in 
                paragraph (1)(B), the Secretary of the Interior or the 
                Secretary of Commerce, as appropriate.
    ``(b) Factors To Be Considered.--
            ``(1) In general.--In determining a condition, a consulting 
        agency shall take into consideration--
                    ``(A) the impacts of the condition on--
                            ``(i) economic and power values;
                            ``(ii) electric generation capacity and 
                        system reliability;
                            ``(iii) air quality; and
                            ``(iv) drinking, flood control, irrigation, 
                        navigation, or recreation water supply; and
                    ``(B) compatibility with other conditions to be 
                included in the license, including mandatory conditions 
                of other agencies, when available.
            ``(2) Documentation.--
                    ``(A) In general.--In the course of the 
                consideration of factors under paragraph (1) and before 
                any review under subsection (e), a consulting agency 
                shall create written documentation detailing, among 
                other pertinent matters, all proposals made, comments 
                received, facts considered, and analyses made regarding 
                each of those factors sufficient to demonstrate that 
                each of the factors was given full consideration in 
                determining the condition to be submitted to the 
                Commission.
                    ``(B) Submission to the commission.--A consulting 
                agency shall include the documentation under 
                subparagraph (A) in its submission of a condition to 
                the Commission.
    ``(c) Scientific Review.--
            ``(1) In general.--Each condition determined by a 
        consulting agency shall be subjected to appropriately 
        substantiated scientific review.
            ``(2) Data.--For the purpose of paragraph (1), a condition 
        shall be considered to have been subjected to appropriately 
        substantiated scientific review if the review--
                    ``(A) was based on current empirical data or field-
                tested data; and
                    ``(B) was subjected to peer review.
    ``(d) Relationship to Impacts on Federal Reservation.--In the case 
of a condition for the purpose of the first proviso of section 4(e), 
each condition determined by a consulting agency shall be directly and 
reasonably related to the impacts of the project within the Federal 
reservation.
    ``(e) Administrative Review.--
            ``(1) Opportunity for review.--Before submitting to the 
        Commission a proposed condition, and before a license applicant 
        files a license application with the Commission, a consulting 
        agency shall provide a license applicant an opportunity to 
        obtain expedited review before an administrative law judge or 
        other independent reviewing body of--
                    ``(A) the reasonableness of the condition in light 
                of the effect that implementation of the condition will 
                have on the energy and economic values of a project; 
                and
                    ``(B) compliance by the consulting agency with the 
                requirements of this section, including the requirement 
                to consider the factors described in subsection (b)(1).
            ``(2) Completion of review.--
                    ``(A) In general.--A review under paragraph (1) 
                shall be completed not more than 180 days after the 
                license applicant notifies the consulting agency of the 
                request for review.
                    ``(B) Failure to make timely completion of 
                review.--If a consulting agency does not provide a 
                license applicant a timely opportunity to review a 
                proposed condition, the Commission may treat a 
                condition submitted by the consulting agency as a 
                recommendation is treated under section 10(j).
            ``(3) Remand.--If the administrative law judge or reviewing 
        body finds that a proposed condition is unreasonable or that 
        the consulting agency failed to comply with any of the 
        requirements of this section, the administrative law judge or 
        reviewing body shall--
                    ``(A) render a decision that--
                            ``(i) explains the reasons for a finding 
                        that the condition is unreasonable and may make 
                        recommendations that the administrative law 
                        judge or reviewing body may have for the 
                        formulation of a condition that would not be 
                        found unreasonable; or
                            ``(ii) explains the reasons for a finding 
                        that a requirement was not met and may describe 
                        any action that the consulting agency should 
                        take to meet the requirement; and
                    ``(B) remand the matter to the consulting agency 
                for further action.
            ``(4) Submission to the commission.--Following 
        administrative review under this subsection, a consulting 
        agency shall--
                    ``(A) take such action as the consulting agency 
                determines to be appropriate to formulate a condition 
                that is not unreasonable or to comply with the 
                requirements of this section; and
                    ``(B) include with its submission to the Commission 
                of a proposed condition--
                            ``(i) the record on administrative review; 
                        and
                            ``(ii) documentation of any action taken 
                        following administrative review.
    ``(f) Deadline for Submission of Conditions.--
            ``(1) In general.--After an applicant files with the 
        Commission an application for a license, the Commission may set 
        a date by which a consulting agency shall file with the 
        Commission a recommended or established condition.
            ``(2) Limitation.--Except as provided in paragraph (3), the 
        date for submission shall be not greater than 1 year after the 
        date on which the Commission gives the consulting agency notice 
        that a license application is ready for environmental review.
            ``(3) Default.--If a consulting agency does not file a 
        recommended or established condition to a license by the date 
        set under paragraph (1)--
                    ``(A) the consulting agency shall not thereafter 
                have authority to recommend or establish a condition to 
                the license; and
                    ``(B) the Commission may, but shall not be required 
                to, recommend or establish an appropriate condition to 
                the license that--
                            ``(i) furthers the interest sought to be 
                        protected by the provision of law that 
                        authorizes the consulting agency to propose or 
                        establish a condition to the license; and
                            ``(ii) conforms to the requirements of this 
                        Act.
            ``(4) Extension.--The Commission may make 1 extension, of 
        not more than 30 days, of a deadline set under paragraph (1).
    ``(g) Economic Analysis By the Commission.--The Commission shall 
conduct an economic analysis of each condition submitted by a 
consulting agency to determine whether the condition would render the 
project uneconomic.
    ``(h) Commission Determination on Effect of Conditions.--When 
requested by a license applicant in a request for rehearing, the 
Commission shall make a written determination on whether a condition 
submitted by a consulting agency is--
            ``(1) in the public interest, as measured by the impact of 
        the condition on the factors described in subsection (b)(1);
            ``(2) reasonable;
            ``(3) supported by substantial evidence; and
            ``(4) consistent with this Act and other terms and 
        conditions to be included in the license.''.
    (b) Conforming and Technical Amendments.--
            (1) Section 4.--Section 4(e) of the Federal Power Act (16 
        U.S.C. 797(e)) is amended in the first proviso of the first 
        sentence by inserting after ``conditions'' the following: ``, 
        determined in accordance with section 32,''.
            (2) Section 18.--Section 18 of the Federal Power Act (16 
        U.S.C. 811) is amended in the first sentence by striking 
        ``prescribed by the Secretary of Commerce'' and inserting 
        ``prescribed, in accordance with section 32, by the Secretary 
        of the Interior or the Secretary of Commerce, as appropriate''.

SEC. 5. COORDINATED ENVIRONMENTAL REVIEW PROCESS.

    Part I of the Federal Power Act (16 U.S.C. 791a et seq.) (as 
amended by section 3) is amended by adding at the end the following:

``SEC. 33. COORDINATED ENVIRONMENTAL REVIEW PROCESS.

    ``(a) Lead Agency Responsibility.--The Commission, as the lead 
agency for environmental reviews under the National Environmental 
Policy Act of 1969 (42 U.S.C. 4321 et seq.) for projects licensed under 
this part, shall conduct a single consolidated environmental review for 
each such project.
    ``(b) Deadlines.--
            ``(1) In general.--The Commission shall set a deadline for 
        the submission of comments by Federal, State, and local 
        government agencies in connection with the preparation of any 
        environmental impact statement or environmental assessment 
        required for a project.
            ``(2) Considerations.--In setting a deadline under 
        paragraph (1), the Commission shall take into consideration--
                    ``(A) the need of the license applicant for a 
                prompt and reasonable decision;
                    ``(B) the resources of interested Federal, State, 
                and local government agencies; and
                    ``(C) applicable statutory requirements.''.

SEC. 6. STUDY OF SMALL HYDROELECTRIC PROJECTS.

    (a) In General.--Not later than 18 months after the date of 
enactment of this Act, the Federal Energy Regulatory Commission shall 
submit to the Committee on Energy and Natural Resources of the Senate 
and the Committee on Commerce of the House of Representatives a study 
of the feasibility of establishing a separate licensing procedure for 
small hydroelectric projects.
    (b) Definition of Small Hydroelectric Project.--The Commission may 
by regulation define the term ``small hydroelectric project'' for the 
purpose of subsection (a), except that the term shall include at a 
minimum a hydroelectric project that has a generating capacity of 5 
megawatts or less.

Summary: Hydroelectric Licensing Process Improvement Act of 1998 - Amends the Federal Power Act to prescribe factors which Federal agency participants in Federal Energy Regulatory Commission (FERC) hydroelectric license renewal process must consider and document when setting forth conditions for such renewals, including the economic impact of such conditions as well as air quality, flood control, irrigation, navigation, and recreation and drinking water supply. Requires that each condition be subjected to appropriately substantiated scientific peer review based on current empirical data or field-tested data. Requires such consulting agency to provide a license applicant opportunity to obtain expedited administrative review of its proposed conditions before filing a FERC application. Empowers the reviewing body to remand the matter to such agency if the reviewer finds the agency's proposed conditions do not comply with this Act. Sets a one-year deadline by which a consulting agency must file its proposed licensing conditions with FERC. Directs FERC to: (1) conduct an economic analysis of each condition submitted by a consulting agency to determine whether it would render the project uneconomic. (2) conduct a single consolidated environmental review for each licensed project pursuant to its status as lead agency for environmental reviews. And (3) set a deadline for the submission of comments by Federal, State, and local government agencies regarding any environmental impact or assessment required for a project. Instructs FERC to consider the need of license applicants for a prompt decision when setting such deadlines. Directs FERC to study and report to certain congressional committees on the feasibility of establishing a separate licensing procedure for small hydroelectric projects with a generating capacity of five megawatts or less.