A bill to provide for Alaska State jurisdiction over small hydroelectric projects, to address voluntary licensing of hydroelectric projects on fresh waters in the State of Hawaii, to provide an exemption for portion of a hydroelectric project located in the State of New Mexico, and for other purposes.

SECTION 1. ALASKA STATE JURISDICTION OVER SMALL HYDROELECTRIC PROJECTS.

    Part I of the Federal Power Act (16 U.S.C. 792 et seq.) is amended 
by adding at the end the following:

``SEC. 32. ALASKA STATE JURISDICTION OVER SMALL HYDROELECTRIC PROJECTS.

    ``(a) Discontinuance of Regulation by the Commission.--
Notwithstanding sections 4(e) and 23(b), the Commission shall 
discontinue exercising licensing and regulatory authority under this 
Part over qualifying project works in the State of Alaska, effective on 
the date on which the Commission certifies that the State of Alaska has 
in place a regulatory program for water-power development that--
            ``(1) protects the public interest, the purposes listed in 
        paragraph (2), and the environment to the same extent provided 
        by licensing and regulation by the Commission under this Part 
        and other applicable Federal laws, including the Endangered 
        Species Act (16 U.S.C. 1531 et seq.) and the Fish and Wildlife 
        Coordination Act (16 U.S.C. 661 et seq.);
            ``(2) gives equal consideration to the purposes of--
                    ``(A) energy conservation;
                    ``(B) the protection, mitigation of damage to, and 
                enhancement of, fish and wildlife (including related 
                spawning grounds and habitat);
                    ``(C) the protection of recreational opportunities,
                    ``(D) the preservation of other aspects of 
                environmental quality,
                    ``(E) the interests of Alaska Natives, and
                    ``(F) other beneficial public uses, including 
                irrigation, flood control, water supply, and 
                navigation; and
            ``(3) requires, as a condition of a license for any project 
        works--
                    ``(A) the construction, maintenance, and operation 
                by a licensee at its own expense of such lights and 
                signals as may be directed by the Secretary of the 
                Department in which the Coast Guard is operating, and 
                such fishways as may be prescribed by the Secretary of 
                the Interior or the Secretary of Commerce, as 
                appropriate;
                    ``(B) the operation of any navigation facilities 
                which may be constructed as part of any project to be 
                controlled at all times by such reasonable rules and 
                regulations as may be made by the Secretary of the 
                Army; and
                    ``(C) conditions for the protection, mitigation, 
                and enhancement of fish and wildlife based on 
                recommendations received pursuant to the Fish and 
                Wildlife Coordination Act (16 U.S.C. 661 et seq.) from 
                the National Marine Fisheries Service, the United 
                States Fish and Wildlife Service, and State fish and 
                wildlife agencies.
    ``(b) Definition of `Qualifying Project Works'.--For purposes of 
this section, the term ``qualifying project works'' means project 
works--
            ``(1) that are not part of a project licensed under this 
        Part or exempted from licensing under this Part or section 405 
        of the Public Utility Regulatory Policies Act of 1978 prior to 
        the date of enactment of this section;
            ``(2) for which a preliminary permit, a license 
        application, or an application for an exemption from licensing 
        has not been accepted for filing by the Commission prior to the 
        date of enactment of subsection (c) (unless such application is 
        withdrawn at the election of the applicant);
            ``(3) that are part of a project that has a power 
        production capacity of 5,000 kilowatts or less;
            ``(4) that are located entirely within the boundaries of 
        the State of Alaska; and
            ``(5) that are not located in whole or in part on any 
        Indian reservation, a conservation system unit (as defined in 
        section 102(4) of the Alaska National Interest Lands 
        Conservation Act (16 U.S.C. 3102(4))), or segment of a river 
        designated for study for addition to the Wild and Scenic Rivers 
        System.
    ``(c) Election of State Licensing.--In the case of nonqualifying 
project works that would be a qualifying project works but for the fact 
that the project has been licensed (or exempted from licensing) by the 
Commission prior to the enactment of this section, the licensee of such 
project may in its discretion elect to make the project subject to 
licensing and regulation by the State of Alaska under this section.
    ``(d) Project Works on Federal Lands.--With respect to projects 
located in whole or in part on a reservation, a conservation system 
unit, or the public lands, a State license or exemption from licensing 
shall be subject to--
            ``(1) the approval of the Secretary having jurisdiction 
        over such lands; and
            ``(2) such conditions as the Secretary may prescribe.
    ``(e) Consultation With Affected Agencies.--The Commission shall 
consult with the Secretary of the Interior, the Secretary of 
Agriculture, and the Secretary of Commerce before certifying the State 
of Alaska's regulatory program.
    ``(f) Application of Federal Laws.--Nothing in this section shall 
preempt the application of Federal environmental, natural resources, or 
cultural resources protection laws according to their terms.
    ``(g) Oversight by the Commission.--The State of Alaska shall 
notify the Commission not later than 30 days after making any 
significant modification to its regulatory program. The Commission 
shall periodically review the State's program to ensure compliance with 
the provisions of this section.
    ``(h) Resumption of Commission Authority.--Notwithstanding 
subsection (a), the Commission shall reassert its licensing and 
regulatory authority under this Part if the Commission finds that the 
State of Alaska has not complied with one or more of the requirements 
of this section.
    ``(i) Determination by the Commission.--
            ``(1) Upon application by the Governor of the State of 
        Alaska, the Commission shall within 30 days commence a review 
        of the State of Alaska's regulatory program for water-power 
        development to determine whether it complies with the 
        requirements of subsection (a).
            ``(2) The Commission's review required by paragraph (1) 
        shall be completed within one year of initiation, and the 
        Commission shall within 30 days thereafter issue a final order 
        determining whether or not the State of Alaska's regulatory 
        program for water-power development complies with the 
        requirements of subsection (a).
            ``(3) If the Commission fails to issue a final order in 
        accordance with paragraph (2), the State of Alaska's regulatory 
        program for water-power development shall be deemed to be in 
        compliance with subsection (a).''.

SEC. 2. VOLUNTARY LICENSING OF HYDROELECTRIC PROJECTS ON FRESH WATERS 
              IN THE STATE OF HAWAII.

    Section 4(e) of the Federal Power Act is amended by striking 
``several States, or upon'' and inserting ``several States (except 
fresh waters in the State of Hawaii, unless a license would be required 
by section 23 of the Act), or upon''.

SEC. 3. LIMITED EXEMPTION FOR TRANSMISSION FACILITIES ASSOCIATED WITH 
              THE EL VADO HYDROELECTRIC PROJECT.

    (a) Part I of the Federal Power Act, and the jurisdiction of the 
Federal Energy Regulatory Commission under such part I, shall not apply 
to the transmission line facilities associated with the El Vado 
Hydroelectric project (FERC project No. 5226) which are described in 
subsection (b).
    (b) The facilities to which the exemption under subsection (a) 
applies are those transmission facilities located near the Rio Chama, a 
tributary of the Rio Grande, in Rio Arriba County, New Mexico, referred 
to as the El Vado transmission line, a three phase 12-mile long 69 kV 
power line installed within a 50-foot wide right-of-way in Rio Arriba 
County, New Mexico, originating at the El Vado project's switchyard and 
connecting to the Spills 69 kV switching station operated by the 
Northern Arriba Electric Cooperative Inc.

SEC. 4. FERC EXTENSION OF COMMENCEMENT OF CONSTRUCTION DEADLINE FOR 
              HYDROELECTRIC PROJECTS.

    The second sentence in section 13 of the Federal Power Act (15 
U.S.C. 806) is amended to read as follows: ``The period for the 
commencement of construction may be extended by the Commission for not 
longer than ten years from the issuance date of the license when not 
incompatible with the public interest, and the period for the 
completion of construction carried on in good faith and with reasonable 
diligence may be extended by the Commission when not incompatible with 
the public interest.''.

SEC. 5. TECHNICAL CORRECTION.

    Section 6 of the Federal Power Act (16 U.S.C. 799) is amended by 
adding at the end the following:
    Licenses may be revoked only for the reasons and in the manner 
prescribed under the provisions of this Act, and may be altered or 
surrendered only upon mutual agreement between the license and the 
Commission after thirty days' public notice.

            Passed the Senate June 25, 1998.

            Attest:

                                                    GARY SISCO,

                                                             Secretary.

Summary: Amends the Federal Power Act to direct the Federal Energy Regulatory Commission (FERC) to discontinue its licensing and regulatory authority over certain new, small qualifying hydroelectric project works in Alaska, effective upon FERC certification that Alaska has a regulatory program in place for water-power development meeting specified criteria. Prescribes such criteria as: (1) protection of certain public and environmental interests to the same extent provided by FERC and specified Federal law. (2) equal consideration given to energy conservation, fish and wildlife protection, recreational opportunities, environmental quality, the interests of Alaska Natives, and beneficial public uses. And (3) licensing requirements for construction, operation and maintenance of lights, signals, and fishways by a licensee at its own expense, operation of navigation facilities subject to Secretary of the Army regulations, and fish and wildlife protection and enhancement based upon Federal and State agency recommendations. Authorizes the licensee of a project works licensed before enactment of this Act to elect to subject such works to licensing and regulation by Alaska in accordance with this Act. Declares that, with respect to project works on an Indian reservation, a conservation system unit, or Federal public lands, a State license or exemption from license shall be subject to the approval of the Secretary having jurisdiction over such lands, and such conditions as the Secretary may prescribe. Requires FERC to consult with the Secretaries of the Interior, of Agriculture, and of Commerce before certifying Alaska's regulatory program. Requires the State of Alaska to notify FERC within 30 days after making any significant modification to its regulatory program. Requires FERC to reassert its regulatory and licensing authority if Alaska has not complied with one or more requirements of this Act. Prescribes FERC compliance review procedures. Excludes from FERC voluntary licensing jurisdiction any hydroelectric projects upon fresh waters in Hawaii, unless a license would be required because: (1) the waters are navigable. Or (2) the projects affect interstate commerce, are located on Federal lands, or use water from a government dam. Exempts from FERC licensing requirements certain transmission line facilities associated with the El Vado Hydroelectric Project in New Mexico. Extends the deadline for commencement of construction of hydroelectric projects from two years to ten years from date of license issuance. Restores the provision that licenses may be revoked only in accordance with the Federal Power Act, and may be altered or surrendered upon mutual agreement between the licensee and FERC after public notice.