79–006 

115TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 1st Session 115–458 

PROMOTING CLOSED-LOOP PUMPED STORAGE 

HYDROPOWER ACT 

DECEMBER 11, 2017.—Committed to the Committee of the Whole House on the State 

of the Union and ordered to be printed 

Mr. WALDEN, from the Committee on Energy and Commerce, 

submitted the following 

R E P O R T 

[To accompany H.R. 2880] 

The Committee on Energy and Commerce, to whom was referred 

the bill (H.R. 2880) to amend the Federal Power Act to promote 

closed-loop pumped storage hydropower, and for other purposes, 

having considered the same, report favorably thereon with an 

amendment and recommend that the bill as amended do pass. 

CONTENTS 

Page 

Purpose and Summary ............................................................................................ 3 

Background and Need for Legislation .................................................................... 3 

Committee Action .................................................................................................... 3 

Committee Votes ...................................................................................................... 4 

Oversight Findings and Recommendations ........................................................... 4 

New Budget Authority, Entitlement Authority, and Tax Expenditures ............. 4 

Congressional Budget Office Estimate ................................................................... 4 

Federal Mandates Statement ................................................................................. 4 

Statement of General Performance Goals and Objectives .................................... 4 

Duplication of Federal Programs ............................................................................ 4 

Committee Cost Estimate ....................................................................................... 4 

Earmark, Limited Tax Benefits, and Limited Tariff Benefits ............................. 4 

Disclosure of Directed Rule Makings ..................................................................... 5 

Advisory Committee Statement .............................................................................. 5 

Applicability to Legislative Branch ........................................................................ 5 

Section-by-Section Analysis of the Legislation ...................................................... 5 

Changes in Existing Law Made by the Bill, as Reported ..................................... 6 

The amendment is as follows: 

Strike all after the enacting clause and insert the following: 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Promoting Closed-Loop Pumped Storage Hydropower Act’’. 

2 

SEC. 2. CLOSED-LOOP PUMPED STORAGE 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. 34. CLOSED-LOOP PUMPED STORAGE PROJECTS. 

‘‘(a) EXPEDITED LICENSING PROCESS FOR CLOSED-LOOP PUMPED STORAGE

PROJECTS.— 

‘‘(1) IN GENERAL.—As provided in this section, the Commission may issue and 

amend licenses and preliminary permits, as appropriate, for closed-loop pumped 

storage projects. 

‘‘(2) RULE.—Not later than 180 days after the date of enactment of this section, the Commission shall issue a rule establishing an expedited process for 

issuing and amending licenses and preliminary permits for closed-loop pumped 

storage projects under this section. 

‘‘(3) INTERAGENCY TASK FORCE.—In establishing the expedited process under 

this section, the Commission shall convene an interagency task force, with appropriate Federal and State agencies and Indian tribes represented, to coordinate the regulatory processes associated with the authorizations required to 

construct and operate closed-loop pumped storage projects. 

‘‘(4) LENGTH OF PROCESS.—The Commission shall ensure that the expedited 

process under this section will result in final decision on an application for a 

license by not later than 2 years after receipt of a completed application for 

such license. 

‘‘(b) DAM SAFETY.—Before issuing any license for a closed-loop pumped storage 

project, the Commission shall assess the safety of existing dams and other structures related to the project (including possible consequences associated with failure 

of such structures). 

‘‘(c) EXEMPTIONS FROM OTHER REQUIREMENTS.— 

‘‘(1) IN GENERAL.—In issuing or amending a license or preliminary permit 

pursuant to the expedited process established under this section, the Commission may grant an exemption from any other requirement of this part with respect to any part of the closed-loop pumped storage project (not including any 

dam or other impoundment). 

‘‘(2) CONSULTATION.—In granting an exemption under paragraph (1), the 

Commission shall consult with the United States Fish and Wildlife Service and 

the State agency exercising administration over the fish and wildlife resources 

of the State in which the closed-loop pumped storage project is or will be located, in the manner provided by the Fish and Wildlife Coordination Act (16 

U.S.C. 661 et seq.). 

‘‘(3) TERMS AND CONDITIONS.—In granting an exemption under paragraph (1), 

the Commission shall include in any such exemption— 

‘‘(A) such terms and conditions as the Fish and Wildlife Service, National 

Marine Fisheries Service, and the State agency described in paragraph (2) 

each determine are appropriate to prevent loss of, or damage to, fish and 

wildlife resources and to otherwise carry out the purposes of the Fish and 

Wildlife Coordination Act; and 

‘‘(B) such terms and conditions as the Commission deems appropriate to 

ensure that such closed-loop pumped storage project continues to comply 

with the provisions of this section and terms and conditions included in any 

such exemption. 

‘‘(4) FEES.—The Commission, in addition to the requirements of section 10(e), 

shall establish fees which shall be paid by an applicant for a license for a 

closed-loop pumped storage project that is required to meet terms and conditions set by fish and wildlife agencies under paragraph (3). Such fees shall be 

adequate to reimburse the fish and wildlife agencies referred to in paragraph 

(3) for any reasonable costs incurred in connection with any studies or other reviews carried out by such agencies for purposes of compliance with this section. 

The fees shall, subject to annual appropriations Acts, be transferred to such 

agencies by the Commission for use solely for purposes of carrying out such 

studies and shall remain available until expended. 

‘‘(d) TRANSFERS.—Notwithstanding section 5, and regardless of whether the holder 

of a preliminary permit for a closed-loop pumped storage project claimed municipal 

preference under section 7(a) when obtaining the permit, the Commission may, to 

facilitate development of a closed-loop pumped storage project— 

‘‘(1) add entities as joint permittees following issuance of a preliminary permit; and 

‘‘(2) transfer a license in part to one or more nonmunicipal entities as co-licensees with a municipality, if the municipality retains majority ownership of 

the project for which the license was issued. 

3 

‘‘(e) INTERAGENCY COMMUNICATIONS.—Interagency cooperation in the preparation 

of environmental documents under the National Environmental Policy Act of 1969 

(42 U.S.C. 4321 et seq.) with respect to an application for a license for a closed-loop 

pumped storage project submitted pursuant to this section, and interagency communications relating to licensing process coordination pursuant to this section, shall 

not— 

‘‘(1) be considered to be ex parte communications under Commission rules; or 

‘‘(2) preclude an agency from participating in a licensing proceeding under 

this part. 

‘‘(f) DEVELOPING ABANDONED MINES FOR PUMPED STORAGE.— 

‘‘(1) WORKSHOP.—Not later than 6 months after the date of enactment of this 

section, the Commission shall hold a workshop to explore potential opportunities for development of closed-loop pumped storage projects at abandoned mine 

sites. 

‘‘(2) GUIDANCE.—Not later than 1 year after the date of enactment of this section, the Commission shall issue guidance to assist applicants for licenses or 

preliminary permits for closed-loop pumped storage projects at abandoned mine 

sites. 

‘‘(g) QUALIFYING CRITERIA FOR CLOSED-LOOP PUMPED STORAGE PROJECTS.— 

‘‘(1) IN GENERAL.—The Commission shall establish criteria that a pumped 

storage project shall meet in order to qualify as a closed-loop pumped storage 

project eligible for the expedited process established under this section. 

‘‘(2) INCLUSIONS.—In establishing the criteria under paragraph (1), the Commission shall include criteria requiring that the pumped storage project— 

‘‘(A) cause little to no change to existing surface and groundwater flows 

and uses; and 

‘‘(B) is unlikely to adversely affect species listed as a threatened species 

or endangered species under the Endangered Species Act of 1973.’’. 

SEC. 3. OBLIGATION FOR PAYMENT OF ANNUAL CHARGES. 

Section 10(e) of the Federal Power Act (16 U.S.C. 803(e)) is amended by adding 

at the end the following: 

‘‘(5) Any obligation of a licensee for payment of annual charges under this subsection shall commence when the construction of the applicable facility commences.’’. 

PURPOSE AND SUMMARY

H.R. 2880 promotes closed-loop pumped storage hydropower development by establishing an expedited licensing process that will 

result in a final decision on an application in two years or less. The 

legislation also requires Federal Energy Regulatory Commission 

(FERC) to hold a workshop to explore potential opportunities for 

development of closed-loop pumped storage projects at abandoned 

mine sites. 

BACKGROUND AND NEED FOR LEGISLATION

H.R. 2880, Promoting Closed-Loop Pumped Storage Hydropower 

Act, was introduced by Representative Morgan Griffith (R–VA) on 

June 12, 2017. 

COMMITTEE ACTION

The Committee on Energy and Commerce has not held hearings 

on the legislation. 

On October 26, 2017, the Subcommittee on Energy met in open 

markup session and forwarded H.R. 2880, without amendment, to 

the full Committee by a voice vote. On December 6, 2017, the full 

Committee on Energy and Commerce met in open markup session 

and ordered H.R. 2880, as amended, favorably reported to the 

House by a voice vote. 

4 

COMMITTEE VOTES

Clause 3(b) of rule XIII requires the Committee to list the record 

votes on the motion to report legislation and amendments thereto. 

There were no record votes taken in connection with ordering H.R. 

2880 reported. 

OVERSIGHT FINDINGS AND RECOMMENDATIONS

Pursuant to clause 2(b)(1) of rule X and clause 3(c)(1) of rule 

XIII, the Committee has not held hearings on this legislation. 

NEW BUDGET AUTHORITY, ENTITLEMENT AUTHORITY, AND TAX

EXPENDITURES

Pursuant to clause 3(c)(2) of rule XIII, the Committee finds that 

H.R. 2880 would result in no new or increased budget authority, 

entitlement authority, or tax expenditures or revenues. 

CONGRESSIONAL BUDGET OFFICE ESTIMATE

Pursuant to clause 3(c)(3) of rule XIII, at the time this report 

was filed, the cost estimate prepared by the Director of the Congressional Budget Office pursuant to section 402 of the Congressional Budget Act of 1974 was not available. 

FEDERAL MANDATES STATEMENT

The Committee adopts as its own the estimate of Federal mandates prepared by the Director of the Congressional Budget Office 

pursuant to section 423 of the Unfunded Mandates Reform Act. 

STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

Pursuant to clause 3(c)(4) of rule XIII, the general performance 

goal or objective of this legislation is to amend the Federal Power 

Act to promote closed-loop pumped storage hydropower. 

DUPLICATION OF FEDERAL PROGRAMS

Pursuant to clause 3(c)(5) of rule XIII, no provision of H.R. 2880 

is known to be duplicative of another Federal program, including 

any program that was included in a report to Congress pursuant 

to section 21 of Public Law 111–139 or the most recent Catalog of 

Federal Domestic Assistance. 

COMMITTEE COST ESTIMATE

Pursuant to clause 3(d)(1) of rule XIII, the Committee adopts as 

its own the cost estimate prepared by the Director of the Congressional Budget Office pursuant to section 402 of the Congressional 

Budget Act of 1974. At the time this report was filed, the estimate 

was not available. 

EARMARK, LIMITED TAX BENEFITS, AND LIMITED TARIFF BENEFITS

Pursuant to clause 9(e), 9(f), and 9(g) of rule XXI, the Committee 

finds that H.R. 2880 contains no earmarks, limited tax benefits, or 

limited tariff benefits. 

5 

DISCLOSURE OF DIRECTED RULE MAKINGS

Pursuant to section 3(i) of H. Res. 5, the following directed rule 

makings are contained in H.R. 2880: • Not later than 180 days after the date of enactment of this 

section, the Commission shall issue a rule establishing an expedited process for issuing and amending licenses and preliminary permits for closed-loop pumped storage projects. 

ADVISORY COMMITTEE STATEMENT

No advisory committees within the meaning of section 5(b) of the 

Federal Advisory Committee Act were created by this legislation. 

APPLICABILITY TO LEGISLATIVE BRANCH

The Committee finds that the legislation does not relate to the 

terms and conditions of employment or access to public services or 

accommodations within the meaning of section 102(b)(3) of the Congressional Accountability Act. 

SECTION-BY-SECTION ANALYSIS OF THE LEGISLATION

Section 1. Short title 

This section provides the short title of ‘‘Promoting Closed-Loop 

Pumped Storage Hydropower Act.’’ 

Section 2. Closed-loop pumped storage projects 

Section 2 amends Part I of the Federal Power Act (FPA) by adding a new section titled ‘‘Sec 34. Closed-Loop Pumped Storage 

Projects.’’ 

FPA section 34(a) allows the Commission to issue and amend licenses and preliminary permits for closed-loop pumped storage 

projects and directs the Commission to issue a rule not later than 

180 days after the date of enactment of this section to establish 

this expedited process. When establishing the expedited process, 

the Commission shall convene an interagency task force with appropriate Federal and State agencies and Indian tribes to coordinate the regulatory process associated with the authorizations required to construct and operate closed-loop pumped storage 

projects. The expedited process established by the Commission 

shall result in a final decision on applications for a license within 

two years of receipt of a completed license application. 

FPA section 34(b) requires the Commission to assess the safety 

of existing dams and other structures related to the project before 

issuing any license for a closed-loop pumped storage project. 

FPA section 34(c) allows the Commission to grant an exemption 

from any other requirement of Part I of the FPA with respect to 

any portion of the closed-loop pumped storage project when issuing 

or amending a license or preliminary permit pursuant to the expedited process established under this section. When granting an exemption, the Commission shall consult with the United States Fish 

and Wildlife Service and the relevant State agency in the manner 

provided by the Fish and Wildlife Coordination Act. Additionally, 

when granting an exemption, the Commission shall include in the 

exemption terms and conditions that the Fish and Wildlife Service, 

National Marine Fisheries Service, and the relevant State agency 

6 

determine are appropriate to prevent loss, or damage to, fish and 

wildlife resources and to otherwise carry out the purposes of the 

Fish and Wildlife Coordination Act, along with terms and conditions that the Commission deems appropriate to ensure that such 

closed-loop pumped storage project continues to comply with the 

provisions of this section. The Commission shall establish fees that 

shall be paid by an applicant for a license for a closed-loop pumped 

storage project that shall be adequate to reimburse the fish and 

wildlife agencies for any reasonable costs incurred in connection 

with any studies or other reviews carried out by such agencies in 

order to comply with this section. The fees shall be subject to annual appropriation Acts and shall be transferred to such agencies 

by the Commission for use solely for purposes of carrying out such 

studies. 

FPA section 34(d) specifies that the Commission may add entities 

as joint permittees following issuance of a preliminary permit and 

may transfer a license in part to one or more nonmunicipal entities 

as co-licensees with a municipality, if the municipality retains majority ownership of the project for which the license was issued. 

FPA section 34(e) directs that any interagency cooperation in the 

preparation of environmental documents under the National Environmental Policy Act of 1969 with respect to an application for a 

license for a closed-loop pumped storage project, and any interagency communications related to licensing process coordination 

shall not be considered to be ex parte communications under Commission rules and shall not preclude an agency from participating 

in a licensing proceeding under Part I of the FPA. 

FPA section 34(f) directs the Commission to hold a workshop, not 

later than six months after the date of enactment of this section, 

to explore potential opportunities for development of closed-loop 

pumped storage projects at abandoned mine sites. Not later than 

one year after the date of enactment of this section, the Commission shall issue guidance to assist applicants for licenses or preliminary permits for closed-loop pumped storage projects at abandoned 

mine sites. 

FPA section 34(g) directs the Commission to establish criteria 

that a pumped storage project must meet in order to qualify as a 

closed-loop pumped storage project eligible for the expedited process established under this section. The Commission established criteria shall include criteria requiring that the pumped storage 

project cause little to no change to existing surface and groundwater flows and uses and is unlikely to adversely affect species listed as a threatened species or endangered species under the Endangered Species Act of 1973. 

Section 3. Obligation for payment of annual charges 

This section amends section 10(e) of the FPA by adding a requirement that any obligation or a licensee for payment of annual 

charges under this subsection shall commence when the construction of the applicable facility commences. 

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (new matter is printed in italic 

7 

and existing law in which no change is proposed is shown in 

roman): 

FEDERAL POWER ACT 

PART I 

* * * * * * * 

SEC. 10. All licenses issued under this Part shall be on the following conditions: 

(a)(1) That the project adopted, including the maps, plans, and 

specifications, shall be such as in the judgment of the Commission 

will be best adapted to a comprehensive plan for improving or developing a waterway or waterways for the use or benefit of interstate or foreign commerce, for the improvement and utilization of 

waterpower development, for the adequate protection, mitigation, 

and enhancement of fish and wildlife (including related spawning 

grounds and habitat), and for other beneficial public uses, including 

irrigation, flood control, water supply, and recreational and other 

purposes referred to in section 4(e); and if necessary in order to secure such plan the Commission shall have authority to require the 

modification of any project and of the plans and specifications of 

the project works before approval. 

(2) In order to ensure that the project adopted will be best adapted to the comprehensive plan described in paragraph (1), the Commission shall consider each of the following: 

(A) The extent to which the project is consistent with a comprehensive plan (where one exists) for improving, developing, 

or conserving a waterway or waterways affected by the project 

that is prepared by— 

(i) an agency established pursuant to Federal law that 

has the authority to prepare such a plan; or 

(ii) the State in which the facility is or will be located. 

(B) The recommendations of Federal and State agencies exercising administration over flood control, navigation, irrigation, recreation, cultural and other relevant resources of the 

State in which the project is located, and the recommendations 

(including fish and wildlife recommendations) of Indian tribes 

affected by the project. 

(C) In the case of a State or municipal applicant, or an applicant which is primarily engaged in the generation or sale of 

electric power (other than electric power solely from cogeneration facilities or small power production facilities), the electricity consumption efficiency improvement program of the applicant, including its plans, performance and capabilities for 

encouraging or assisting its customers to conserve electricity 

cost-effectively, taking into account the published policies, restrictions, and requirements of relevant State regulatory authorities applicable to such applicant. 

(3) Upon receipt of an application for a license, the Commission 

shall solicit recommendations from the agencies and Indian tribes 

identified in subparagraphs (A) and (B) of paragraph (2) for proposed terms and conditions for the Commission’s consideration for 

inclusion in the license. 

8 

(b) That except when emergency shall require for the protection 

of navigation, life, health, or property, no substantial alteration or 

addition not in conformity with the approved plans shall be made 

to any dam or other project works constructed hereunder of an installed capacity in excess of two thousand horsepower without the 

prior approval of the Commission; and any emergency alteration or 

addition so made shall thereafter be subject to such modification 

and change as the Commission may direct. 

(c) That the licensee shall maintain the project works in a condition or repair adequate for the purposes of navigation and for the 

efficient operation of said works in the development and transmission of power, shall make all necessary renewals and replacements, shall establish and maintain adequate depreciation reserves 

for such purposes, shall so maintain and operate said works as not 

to impair navigation, and shall conform to such rules and regulations as the Commission may from time to time prescribe for the 

protection of life, health, and property. Each licensee hereunder 

shall be liable for all damages occasioned to the property of others 

by the construction, maintenance, or operation of the project works 

or of the works appurtenant or accessory thereto, constructed 

under the license, and in no event shall the United States be liable 

therefor. 

(d) That after the first twenty years of operation, out of surplus 

earned thereafter, if any, accumulated in excess of a specified reasonable rate of return upon the net investment of a licensee in any 

project or projects, under license, the licensee shall establish and 

maintain amortization reserves, which reserves shall, in the discretion of the Commission, be held until the termination of the license 

or be applied from time to time in reduction of the net investment. 

Such specified rate of return and the proportion of such surplus 

earnings to be paid into and held in such reserves shall be set forth 

in the license. For any new license issued under section 15, the amortization reserves under this subsection shall be maintained on 

and after the effective date of such new license. 

(e)(1) That the licensee shall pay to the United States reasonable 

annual charges in an amount to be fixed by the Commission for the 

purpose of reimbursing the United States for the costs of the administration of this Part, including any reasonable and necessary 

costs incurred by Federal and State fish and wildlife agencies and 

other natural and cultural resource agencies in connection with 

studies or other reviews carried out by such agencies for purposes 

of administering their responsibilities under this part; for 

recompensing it for the use, occupancy, and enjoyment of its lands 

or other property; and for the expropriation to the Government of 

excessive profits until the respective States shall make provision 

for preventing excessive profits or for the expropriation thereof to 

themselves, or until the period of amortization as herein provided 

is reached, and in fixing such charges the Commission shall seek 

to avoid increasing the price to the consumers of power by such 

charges, and any such charges may be adjusted from time to time 

by the Commission as conditions may require: Provided, That, subject to annual appropriations Acts, the portion of such annual 

charges imposed by the Commission under this subsection to cover 

the reasonable and necessary costs of such agencies shall be available to such agencies (in addition to other funds appropriated for 

9 

such purposes) solely for carrying out such studies and reviews and 

shall remain available until expended: Provided, That when licenses are issued involving the use of Government dams or other 

structures owned by the United States or tribal lands embraced 

within Indian reservations the Commission shall, subject to the approval of the Secretary of the Interior in the case of such dams or 

structures in reclamation projects and, in the case of such tribal 

lands, subject to the approval of the Indian tribe having jurisdiction of such lands as provided in section 16 of the Act of June 18, 

1934 (48 Stat. 984), fix a reasonable annual charge for the use 

thereof, and such charges may with like approval be readjusted by 

the Commission at the end of twenty years after the project is 

available for service and at periods of not less than ten years thereafter upon notice and opportunity for hearing: Provided further, 

That licenses for the development, transmission, or distribution of 

power by States or municipalities shall be issued and enjoyed without charge to the extent such power is sold to the public without 

profit or is used by such State or municipality for State or municipal purposes, except that as to projects constructed or to be constructed by States or municipalities primarily designed to provide 

or improve navigation, licenses therefor shall be issued without 

charge; and that licenses for the development, transmission, or distribution of power for domestic, mining, or other beneficial use in 

projects of not more than two thousand horsepower installed capacity may be issued without charges, except on tribal lands within Indian reservations; but in no case shall a license be issued free of 

charge for the development and utilization of power created by any 

Government dam and that the amount charged therefor in any license shall be such as determined by the Commission : Provided 

however, That no charge shall be assessed for the use of any Government dam or structure by any licensee if, before January 1, 

1985, the Secretary of the Interior has entered into a contract with 

such licensee that meets each of the following requirements: 

(A) The contract covers one or more projects for which a license was issued by the Commission before January 1, 1985. 

(B) The contract contains provisions specifically providing 

each of the following: 

(i) A powerplant may be built by the licensee utilizing irrigation facilities constructed by the United States. 

(ii) The powerplant shall remain in the exclusive control, 

possession, and ownership of the licensee concerned. 

(iii) All revenue from the powerplant and from the use, 

sale, or disposal of electric energy from the powerplant 

shall be, and remain, the property of such licensee. 

(C) The contract is an amendatory, supplemental and replacement contract between the United States and: (i) the 

Quincy-Columbia Basin Irrigation District (Contract No. 14– 

06–100–6418); (ii) the East Columbia Basin Irrigation District 

(Contract No. 14–06–100–6419); or, (iii) the South Columbia 

Basin Irrigation District (Contract No. 14–06–100–6420). 

This paragraph shall apply to any project covered by a contract referred to in this paragraph only during the term of such contract 

unless otherwise provided by subsequent Act of Congress. In the 

event an overpayment of any charge due under this section shall 

be made by a licensee, the Commission is authorized to allow a 

10 

credit for such overpayment when charges are due for any subsequent period. 

(2) In the case of licenses involving the use of Government dams 

or other structures owned by the United States, the charges fixed 

(or readjusted) by the Commission under paragraph (1) for the use 

of such dams or structures shall not exceed 1 mill per kilowatthour for the first 40 gigawatt-hours of energy a project produces in 

any year, 11⁄2 mills per kilowatt-hour for over 40 up to and including 80 gigawatt-hours in any year, and 2 mills per kilowatt-hour 

for any energy the project produces over 80 gigawatt-hours in any 

year. Except as provided in subsection (f), such charge shall be the 

only charge assessed by any agency of the United States for the use 

of such dams or structures. 

(3) The provisions of paragraph (2) shall apply with respect to— 

(A) all licenses issued after the date of the enactment of this 

paragraph; and 

(B) all licenses issued before such date which— 

(i) did not fix a specific charge for the use of the Government dam or structure involved; and 

(ii) did not specify that no charge would be fixed for the 

use of such dam or structure. 

(4) Every 5 years, the Commission shall review the appropriateness of the annual charge limitations provided for in this subsection and report to Congress concerning its recommendations 

thereon. 

(5) Any obligation of a licensee for payment of annual charges 

under this subsection shall commence when the construction of the 

applicable facility commences. 

(f) That whenever any licensee hereunder is directly benefited by 

the construction work of another licensee, a permittee, or of the 

United States of a storage reservoir or other headwater improvement, the Commission shall require as a condition of the license 

that the licensee so benefited shall reimburse the owner of such 

reservoir or other improvements for such part of the annual 

charges for interest, maintenance, and depreciation thereon as the 

Commission may deem equitable. The proportion of such charges to 

be paid by any licensee shall be determined by the Commission. 

The licensees or permittees affected shall pay to the United States 

the cost of making such determination as fixed by the Commission. 

Whenever such reservoir or other improvement is constructed by 

the United States the Commission shall assess similar charges 

against any licensee directly benefited thereby, and any amount so 

assessed shall be paid into the Treasury of the United States, to 

be reserved and appropriated as a part of the special fund for headwater improvements as provided in section 17 hereof. 

Whenever any power project not under license is benefited by the 

construction work of a licensee or permittee, the United States or 

any agency thereof, the Commission, after notice to the owner or 

owners of such unlicensed project, shall determine and fix a reasonable and equitable annual charge to be paid to the licensee or permittee on account of such benefits, or to the United States if it be 

the owner of such headwater improvement. 

(g) Such other conditions not inconsistent with the provisions of 

this Act as the Commission may require. 

11 

(h)(1) That combinations, agreements, arrangements, or understandings, express or implied, to limit the output of electrical energy, to restrain trade, or to fix, maintain, or increase prices for 

electrical energy or service are hereby prohibited. 

(2) That conduct under the license that: (A) results in the contravention of the policies expressed in the antitrust laws; and (B) 

is not otherwise justified by the public interest considering regulatory policies expressed in other applicable law (including but not 

limited to those contained in Part II of this Act) shall be prevented 

or adequately minimized by means of conditions included in the license prior to its issuance. In the event it is impossible to prevent 

or adequately minimize the contravention, the Commission shall 

refuse to issue any license to the applicant for the project and, in 

the case of an existing project, shall take appropriate action to provide thereafter for the operation and maintenance of the affected 

project and for the issuing of a new license in accordance with section 15 of this Part. 

(i) In issuing licenses for a minor part only of a complete project, 

or for a complete project of not more than two thousand horsepower 

installed capacity, the Commission may in its discretion waive such 

conditions, provisions, and requirements of this Part, except the license period of fifty years, as it may deem to be to the public interest to waive under the circumstances: Provided, That the provision 

hereof shall not apply annual charges for use of lands within Indian reservations. 

(j)(1) That in order to adequately and equitably protect, mitigate 

damages to, and enhance, fish and wildlife (including related 

spawning grounds and habitat) affected by the development, operation, and management of the project, each license issued under 

this Part shall include conditions for such protection, mitigation, 

and enhancement. Subject to paragraph (2), such conditions shall 

be 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. 

(2) Whenever the Commission believes that any recommendation 

referred to in paragraph (1) may be inconsistent with the purposes 

and requirements of this Part or other applicable law, the Commission and the agencies referred to in paragraph (1) shall attempt to 

resolve any such inconsistency, giving due weight to the recommendations, expertise, and statutory responsibilities of such 

agencies. If, after such attempt, the Commission does not adopt in 

whole or in part a recommendation of any such agency, the Commission shall publish each of the following findings (together with 

a statement of the basis for each of the findings): 

(A) A finding that adoption of such recommendation is inconsistent with the purposes and requirements of this Part or 

with other applicable provisions of law. 

(B) A finding that the conditions selected by the Commission 

comply with the requirements of paragraph (1). 

Subsection (i) shall not apply to the conditions required under this 

subsection. 

* * * * * * * 

12 

SEC. 34. CLOSED-LOOP PUMPED STORAGE PROJECTS. 

(a) EXPEDITED LICENSING PROCESS FOR CLOSED-LOOP PUMPED

STORAGE PROJECTS.— 

(1) IN GENERAL.—As provided in this section, the Commission 

may issue and amend licenses and preliminary permits, as appropriate, for closed-loop pumped storage projects. 

(2) RULE.—Not later than 180 days after the date of enactment of this section, the Commission shall issue a rule establishing an expedited process for issuing and amending licenses 

and preliminary permits for closed-loop pumped storage 

projects under this section. 

(3) INTERAGENCY TASK FORCE.—In establishing the expedited 

process under this section, the Commission shall convene an 

interagency task force, with appropriate Federal and State 

agencies and Indian tribes represented, to coordinate the regulatory processes associated with the authorizations required to 

construct and operate closed-loop pumped storage projects. 

(4) LENGTH OF PROCESS.—The Commission shall ensure that 

the expedited process under this section will result in final decision on an application for a license by not later than 2 years 

after receipt of a completed application for such license. 

(b) DAM SAFETY.—Before issuing any license for a closed-loop 

pumped storage project, the Commission shall assess the safety of 

existing dams and other structures related to the project (including 

possible consequences associated with failure of such structures). 

(c) EXEMPTIONS FROM OTHER REQUIREMENTS.— 

(1) IN GENERAL.—In issuing or amending a license or preliminary permit pursuant to the expedited process established under 

this section, the Commission may grant an exemption from any 

other requirement of this part with respect to any part of the 

closed-loop pumped storage project (not including any dam or 

other impoundment). 

(2) CONSULTATION.—In granting an exemption under paragraph (1), the Commission shall consult with the United States 

Fish and Wildlife Service and the State agency exercising administration over the fish and wildlife resources of the State in 

which the closed-loop pumped storage project is or will be located, in the manner provided by the Fish and Wildlife Coordination Act (16 U.S.C. 661 et seq.). 

(3) TERMS AND CONDITIONS.—In granting an exemption 

under paragraph (1), the Commission shall include in any such 

exemption— 

(A) such terms and conditions as the Fish and Wildlife 

Service, National Marine Fisheries Service, and the State 

agency described in paragraph (2) each determine are appropriate to prevent loss of, or damage to, fish and wildlife 

resources and to otherwise carry out the purposes of the 

Fish and Wildlife Coordination Act; and 

(B) such terms and conditions as the Commission deems 

appropriate to ensure that such closed-loop pumped storage 

project continues to comply with the provisions of this section and terms and conditions included in any such exemption. 

(4) FEES.—The Commission, in addition to the requirements 

of section 10(e), shall establish fees which shall be paid by an 

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applicant for a license for a closed-loop pumped storage project 

that is required to meet terms and conditions set by fish and 

wildlife agencies under paragraph (3). Such fees shall be adequate to reimburse the fish and wildlife agencies referred to in 

paragraph (3) for any reasonable costs incurred in connection 

with any studies or other reviews carried out by such agencies 

for purposes of compliance with this section. The fees shall, subject to annual appropriations Acts, be transferred to such agencies by the Commission for use solely for purposes of carrying 

out such studies and shall remain available until expended. 

(d) TRANSFERS.—Notwithstanding section 5, and regardless of 

whether the holder of a preliminary permit for a closed-loop 

pumped storage project claimed municipal preference under section 

7(a) when obtaining the permit, the Commission may, to facilitate 

development of a closed-loop pumped storage project— 

(1) add entities as joint permittees following issuance of a 

preliminary permit; and 

(2) transfer a license in part to one or more nonmunicipal entities as co-licensees with a municipality, if the municipality retains majority ownership of the project for which the license 

was issued. 

(e) INTERAGENCY COMMUNICATIONS.—Interagency cooperation in 

the preparation of environmental documents under the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) with respect 

to an application for a license for a closed-loop pumped storage 

project submitted pursuant to this section, and interagency communications relating to licensing process coordination pursuant to this 

section, shall not— 

(1) be considered to be ex parte communications under Commission rules; or 

(2) preclude an agency from participating in a licensing proceeding under this part. 

(f) DEVELOPING ABANDONED MINES FOR PUMPED STORAGE.— 

(1) WORKSHOP.—Not later than 6 months after the date of enactment of this section, the Commission shall hold a workshop 

to explore potential opportunities for development of closed-loop 

pumped storage projects at abandoned mine sites. 

(2) GUIDANCE.—Not later than 1 year after the date of enactment of this section, the Commission shall issue guidance to assist applicants for licenses or preliminary permits for closedloop pumped storage projects at abandoned mine sites. 

(g) QUALIFYING CRITERIA FOR CLOSED-LOOP PUMPED STORAGE

PROJECTS.— 

(1) IN GENERAL.—The Commission shall establish criteria 

that a pumped storage project shall meet in order to qualify as 

a closed-loop pumped storage project eligible for the expedited 

process established under this section. 

(2) INCLUSIONS.—In establishing the criteria under paragraph (1), the Commission shall include criteria requiring that 

the pumped storage project— 

(A) cause little to no change to existing surface and 

groundwater flows and uses; and 

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(B) is unlikely to adversely affect species listed as a 

threatened species or endangered species under the Endangered Species Act of 1973. 

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