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[House Report 115-213]
[From the U.S. Government Publishing Office]

115th Congress   }                                           {    Report
                        HOUSE OF REPRESENTATIVES
 1st Session     }                                           {   115-213

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TO AMEND THE FEDERAL POWER ACT WITH RESPECT TO THE CRITERIA AND PROCESS 
         TO QUALIFY AS A QUALIFYING CONDUIT HYDROPOWER FACILITY

                                _______
                                

 July 12, 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. 2786]

    The Committee on Energy and Commerce, to whom was referred 
the bill (H.R. 2786) to amend the Federal Power Act with 
respect to the criteria and process to qualify as a qualifying 
conduit hydropower facility, having considered the same, 
reports favorably thereon with an amendment and recommends that 
the bill as amended do pass.

                                CONTENTS

                                                                   Page
Purpose and Summary..............................................     2
Background and Need for Legislation..............................     2
Committee Action.................................................     2
Committee Votes..................................................     3
Oversight Findings and Recommendations...........................     3
New Budget Authority, Entitlement Authority, and Tax Expenditures     3
Congressional Budget Office Estimate.............................     3
Federal Mandates Statement.......................................     3
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..............................     4
Advisory Committee Statement.....................................     4
Applicability to Legislative Branch..............................     4
Section-by-Section Analysis of the Legislation...................     4
Changes in Existing Law Made by the Bill, as Reported............     4

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. QUALIFYING CONDUIT HYDROPOWER FACILITIES.

  Section 30(a) of the Federal Power Act (16 U.S.C. 823a(a)) is 
amended--
          (1) in paragraph (2)(C), by striking ``45 days'' and 
        inserting ``30 days''; and
          (2) in paragraph (3)(C)--
                  (A) in clause (i), by adding ``and'' after the 
                semicolon;
                  (B) by striking clause (ii); and
                  (C) by redesignating clause (iii) as clause (ii).

                          Purpose and Summary

    H.R. 2786, a bill to amend the Federal Power Act with 
respect to the criteria and process to qualify as a qualifying 
conduit hydropower facility, was introduced by Rep. Hudson (R-
NC) and Rep. DeGette (D-CO) on June 6, 2017. H.R. 2786 would 
promote the development of conduit hydropower facilities by 
reducing the regulatory review period and allowing for larger 
conduit projects to be eligible for exemption from the Federal 
Energy Regulatory Commission's jurisdiction.

                  Background and Need for Legislation

    Under the Federal Power Act (FPA), the Federal Energy 
Regulatory Commission (FERC) issues licenses for projects 
within its jurisdiction, and exemptions for projects that would 
be located at existing dams or within conduits, as long as 
these projects meet specific criteria. Exemptions are 
perpetual, and thus do not need to be renewed.
    Congress established qualifying conduit exemptions under 
the provisions of the Hydropower Regulatory Efficiency Act of 
2013. That legislation amended section 30 of the FPA to allow 
FERC to issue exemptions for generation projects that use the 
hydroelectric potential of manmade conduits that are operated 
for the distribution of water for agricultural, municipal, or 
industrial consumption, and not primarily for generation of 
electricity.
    Under section 30 of the FPA, not later than 15 days from 
the date of notice of intent for a qualifying conduit, FERC 
must make an initial determination as to whether the facility 
meets the qualifying criteria, and, if so, publish a public 
notice of intent. Following the notice, a period of 45 days is 
provided for public comment on FERC's initial determination as 
to whether a facility meets the qualifying criteria, which 
includes a five megawatt limitation on the facility's installed 
capacity.
    The Committee finds the qualifying conduit program to be a 
success, with the entire process taking about two months, 
including the required 45-day public notice period during which 
FERC has very rarely received comments that have bearing on 
whether the facility qualifies. H.R. 2786 would provide 
benefits to a greater range conduit hydropower projects by 
shortening the 45-day notice period to 30 days, and allowing 
larger conduit projects to be eligible for exemption from 
FERC's jurisdiction.

                            Committee Action

    On May 3, 2017, the Subcommittee on Energy held a 
legislative hearing on discussion draft H.R. --------, 
Promoting Small Conduit Hydropower Facilities Act of 2017. The 
Subcommittee received testimony from:
           Terry Turpin, Director, Office of Energy 
        Projects, Federal Energy Regulatory Commission;
           John Katz, Deputy Associate General Counsel, 
        Office of the General Counsel, Federal Energy 
        Regulatory Commission;
           Jeffrey Leahey, Deputy Executive Director, 
        National Hydropower Association;
           Donald Santa, President and CEO, Interstate 
        Natural Gas Association of America;
           Andy Black, President and CEO, Association 
        of Oil Pipe Lines;
           Jeffrey Soth, Legislative and Political 
        Director, International Union of Operating Engineers;
           Bob Irvin, President and CEO, American 
        Rivers; and,
           Jennifer Danis, Senior Staff Attorney, 
        Eastern Environmental Law Center.
    On June 22, 2017, the Subcommittee on Energy met in open 
markup session and forwarded H.R. 2786, as amended, to the full 
Committee by a voice vote. On June 28, 2017, the full Committee 
on Energy and Commerce met in open markup session and ordered 
H.R. 2786, as amended, favorably reported to the House by a 
voice vote.

                            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. 2786 reported.

                 Oversight Findings and Recommendations

    Pursuant to clause 2(b)(1) of rule X and clause 3(c)(1) of 
rule XIII, the Committee held a hearing and made findings that 
are reflected in this report.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    Pursuant to clause 3(c)(2) of rule XIII, the Committee 
finds that H.R. 2786 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 promote 
the development of conduit hydropower facilities.

                    Duplication of Federal Programs

    Pursuant to clause 3(c)(5) of rule XIII, no provision of 
H.R. 2786 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. 2786 contains no earmarks, limited 
tax benefits, or limited tariff benefits.

                  Disclosure of Directed Rule Makings

    Pursuant to section 3(i) of H. Res. 5, the Committee finds 
that H.R. 2786 contains no directed rule makings.

                      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. Qualifying conduit hydropower facilities

    This section amends section 30(a) of the Federal Power Act 
by requiring FERC to determine whether a facility meets 
qualifying small conduit facility criteria no later than 45 
days after receipt of a notice of intent to construct. The 
legislation also strikes the five megawatt cap on qualifying 
conduit hydropower facilities.

         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 (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

                           FEDERAL POWER ACT

PART I

           *       *       *       *       *       *       *

  Sec. 30. (a)(1) A qualifying conduit hydropower facility 
shall not be required to be licensed under this part.
  (2)(A) Any person, State, or municipality proposing to 
construct a qualifying conduit hydropower facility shall file 
with the Commission a notice of intent to construct such 
facility. The notice shall include sufficient information to 
demonstrate that the facility meets the qualifying criteria.
  (B) Not later than 15 days after receipt of a notice of 
intent filed under subparagraph (A), the Commission shall--
          (i) make an initial determination as to whether the 
        facility meets the qualifying criteria; and
          (ii) if the Commission makes an initial 
        determination, pursuant to clause (i), that the 
        facility meets the qualifying criteria, publish public 
        notice of the notice of intent filed under subparagraph 
        (A).
  (C) If, not later than [45 days] 30 days after the date of 
publication of the public notice described in subparagraph 
(B)(ii)--
          (i) an entity contests whether the facility meets the 
        qualifying criteria, the Commission shall promptly 
        issue a written determination as to whether the 
        facility meets such criteria; or
          (ii) no entity contests whether the facility meets 
        the qualifying criteria, the facility shall be deemed 
        to meet such criteria.
  (3) For purposes of this section:
          (A) The term ``conduit'' means any tunnel, canal, 
        pipeline, aqueduct, flume, ditch, or similar manmade 
        water conveyance that is operated for the distribution 
        of water for agricultural, municipal, or industrial 
        consumption and not primarily for the generation of 
        electricity.
          (B) The term ``qualifying conduit hydropower 
        facility'' means a facility (not including any dam or 
        other impoundment) that is determined or deemed under 
        paragraph (2)(C) to meet the qualifying criteria.
          (C) The term ``qualifying criteria'' means, with 
        respect to a facility--
                  (i) the facility is constructed, operated, or 
                maintained for the generation of electric power 
                and uses for such generation only the 
                hydroelectric potential of a non-federally 
                owned conduit; and
                  [(ii) the facility has an installed capacity 
                that does not exceed 5 megawatts; and]
                  [(iii)] (ii) on or before the date of 
                enactment of the Hydropower Regulatory 
                Efficiency Act of 2013, the facility is not 
                licensed under, or exempted from the license 
                requirements contained in, this part.
  (b) Subject to subsection (c), the Commission may grant an 
exemption in whole or in part from the requirements of this 
part, including any license requirements contained in this 
part, to any facility (not including any dam or other 
impoundment) constructed, operated, or maintained for the 
generation of electric power which the Commission determines, 
by rule or order--
          (1) utilizes for such generation only the 
        hydroelectric potential of a conduit; and
          (2) has an installed capacity that does not exceed 40 
        megawatts.
  (c) In making the determination under subsection (b) 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 
facility is or will be located, in the manner provided by the 
Fish and Wildlife Coordination Act (16 U.S.C. 661, et seq.), 
and shall include in any such exemption--
          (1) such terms and conditions as the Fish and 
        Wildlife Service National Marine Fisheries Service and 
        the State agency each determine are appropriate to 
        prevent loss of, or damage to, such resources and to 
        otherwise carry out the purposes of such Act, and
          (2) such terms and conditions as the Commission deems 
        appropriate to insure that such facility continues to 
        comply with the provisions of this section and terms 
        and conditions included in any such exemption.
  (d) Any violation of a term or condition of any exemption 
granted under subsection (b) shall be treated as a violation of 
a rule or order of the Commission under this Act.
  (e) The Commission, in addition to the requirements of 
section 10(e), shall establish fees which shall be paid by an 
applicant for a license or exemption for a project that is 
required to meet terms and conditions set by fish and wildlife 
agencies under subsection (c). Such fees shall be adequate to 
reimburse the fish and wildlife agencies referred to in 
subsection (c) 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.

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