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[Senate Report 115-77]
[From the U.S. Government Publishing Office]

                                                        Calendar No. 96
                                                        
115th Congress   }                                           {   Report
                                 SENATE
 1st Session     }                                           {   115-77

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TO AUTHORIZE THE FEDERAL ENERGY REGULATORY COMMISSION TO ISSUE AN ORDER 
   CONTINUING A STAY OF A HYDROELECTRIC LICENSE FOR THE MAHONEY LAKE 
  HYDROELECTRIC PROJECT IN THE STATE OF ALASKA, AND FOR OTHER PURPOSES

                                _______
                                

                  May 24, 2017.--Ordered to be printed

                                _______
                                

  Ms. Murkowski, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 215]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 215) to authorize the Federal Energy 
Regulatory Commission to issue an order continuing a stay of a 
hydroelectric license for the Mahoney Lake hydroelectric 
project in the State of Alaska, and for other purposes, having 
considered the same, reports favorably thereon without 
amendment and recommends that the bill do pass.

                                PURPOSE

    The purpose of S. 215 is to direct the Federal Energy 
Regulatory Commission (Commission) to issue an order continuing 
a stay of a hydroelectric license for the Mahoney Lake 
hydroelectric project in the State of Alaska.

                          BACKGROUND AND NEED

    The Mahoney Lake Hydroelectric Project was first proposed 
in the 1990s as a 9.6 megawatt lake-tap project. In 2002, 
Congress directed the Commission to grant a stay for the 
project's construction until not later than six years after the 
Commission received written notice that the Swan-Tyee 
electrical transmission intertie was completed. The Commission 
received written notice of the completion of the Swan-Tyee 
electrical transmission intertie on October 4, 2011, thus 
requiring the Commission to lift the stay no later than October 
4, 2017.
    Currently, the Southeast Alaska Power Authority (SEAPA) is 
reviewing potential power sources to meet the City of 
Ketchikan's projected power needs over the next decade. As part 
of that study, SEAPA is considering the merits of a number of 
projects, including the construction of Mahoney Lake. In order 
to keep the Mahoney Lake hydropower project viable as a 
potential renewable energy project, the Cape Fox Native 
Corporation of Ketchikan, the Alaska Power and Telephone 
Company, and the City of Saxman seek an additional stay of the 
license for the Mahoney Lake project, along with a potential 
extension of the construction start deadline.

                          LEGISLATIVE HISTORY

    Senators Murkowski and Sullivan introduced S. 215 on 
January 24, 2017.
    In the 114th Congress, S. 2046 was introduced by Senator 
Murkowski on September 17, 2015. The Committee on Energy and 
Natural Resources held a hearing on October 8, 2015 to consider 
the bill and ordered S. 2046 favorably reported, as amended, at 
its business meeting on November 19, 2015 (S. Rept. 114-190). 
Representative Don Young introduced companion legislation, H.R. 
5302, in the House of Representatives on May 19, 2016.
    The measure was included in Amendment No. 3234, which the 
Senate agreed to on April 19, 2016, as an amendment to S. 2012, 
the Energy Policy Modernization Act of 2016, which the Senate 
passed, as amended, on April 20, 2016.
    The Committee on Energy and Natural Resources met in open 
business session on March 30, 2017, and ordered S. 215 
favorably reported.

                        COMMITTEE RECOMMENDATION

    The Senate Committee on Energy and Natural Resources, in 
open business session on March 30, 2017, by a majority voice 
vote of a quorum present, recommends that the Senate pass S. 
215.

                      SECTION-BY-SECTION ANALYSIS

Section 1. Stay and reinstatement of FERC license No. 11393 for the 
        Mahoney Lake Hydroelectric Project

    Section 1(a) defines key terms.
    Subsection (b) directs the Commission, at the request of 
the licensee, to issue a stay of license.
    Subsection (c) directs the Commission, at the request of 
the licensee, to lift the stay of the license and make the 
effective date of the license the day the stay is lifted. Such 
request by the licensee must be made within 10 years of the 
date of enactment of this Act.
    Subsection (d) directs the Commission, at the request of 
the licensee, to extend the time period for project 
construction commencement for up to six years. Such extension 
is to be undertaken after reasonable notice and in accordance 
with the good faith, due diligence, and public interest 
requirements of section 13 of the Federal Power Act.
    Subsection (e) clarifies that S. 215 does not prioritize or 
create any advantage or disadvantage for the Mahoney Lake 
Hydroelectric Project.

                   COST AND BUDGETARY CONSIDERATIONS

    The following estimate of costs of this measure has been 
provided by the Congressional Budget Office:
    CBO estimates that implementing S. 215 would have no net 
effect on the federal budget. The bill would direct the Federal 
Energy Regulatory Commission (FERC), at the request of the 
licensee of the Mahoney Lake hydroelectric project in Alaska 
(number 11393), to issue an order to continue a stay of the 
license for that project. The bill also would direct FERC, upon 
the licensee's request, to subsequently lift that stay and 
extend for up to three consecutive two-year periods the 
deadline for beginning construction of the hydroelectric 
project. Implementing S. 215 could have a minor effect on 
FERC's workload; however, because FERC recovers 100 percent of 
its costs through user fees, any change in that agency's costs 
(which are controlled through annual appropriation acts) would 
be offset by an equal change in fees that the commission 
charges, resulting in no net change in federal spending.
    Enacting S. 215 would not affect direct spending or 
revenues; therefore, pay-as-you-go procedures do not apply. CBO 
estimates that enacting S. 215 would not increase net direct 
spending or on-budget deficits in any of the four consecutive 
10-year periods beginning in 2028.
    S. 215 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would impose no costs on state, local, or tribal governments.
    The CBO staff contact for this estimate is Megan Carroll. 
The estimate was approved by H. Samuel Papenfuss, Deputy 
Assistant Director for Budget Analysis.

                      REGULATORY IMPACT EVALUATION

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out S. 215. The bill is not a regulatory measure in 
the sense of imposing Government-established standards or 
significant economic responsibilities on private individuals 
and businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Little, if any, additional paperwork would result from the 
enactment of S. 215, as ordered reported.

                   CONGRESSIONALLY DIRECTED SPENDING

    S. 215, as ordered reported, does not contain any 
congressionally directed spending items, limited tax benefits, 
or limited tariff benefits as defined in rule XLIV of the 
Standing Rules of the Senate.

                        EXECUTIVE COMMUNICATIONS

    Because S. 215 is similar to legislation considered by the 
Committee in the 114th Congress, the Committee did not request 
Executive Agency views. The relevant portion of the written 
testimony provided by the Chairman of the Federal Energy 
Regulatory Commission for the hearing before the Energy and 
Natural Resources Committee on October 8, 2015, follows:

              Federal Energy Regulatory Commission,
                                    Office of the Chairman,
                                                    Washington, DC.
Re S. 1583, S. 2083, and S. 2046.

Hon. Lisa Murkowski,
Chairman, Committee on Energy and Natural Resources,
Washington, DC.
    Dear Chairman Murkowski: This letter is in response to a 
request by the Senate Committee on Energy and Natural Resources 
for my views on S. 1583, a bill to authorize the expansion of 
the existing Terror Lake Hydroelectric Project, located at 
Terror Lake, on Kodiak Island, Alaska; S. 2083, a bill to 
extend the deadline for the commencement of construction of the 
W. Kerr Scott Hydroelectric Project in North Carolina; and S. 
2046, a bill to authorize the Federal Energy Regulatory 
Commission (Commission) to issue an order continuing a stay of 
a hydroelectric license for the Mahoney Lake Project in the 
State of Alaska, and for other purposes.

                                S. 2046

    On January 22, 1998, the Commission issued the City of 
Saxman, Alaska an original license authorizing the construction 
and operation of the proposed 9.6-MW Mahoney Lake Hydroelectric 
Project, to be located on Upper Mahoney Lake and Upper Mahoney 
Creek, near Ketchikan, Alaska. On August 5, 2004, as required 
by Public Law No. 108-7, the Commission issued an order 
granting stay of the Mahoney Lake Project license. Under 
section 314(b) of the law, the Commission was required to lift 
the stay upon request of the City, but not later than six years 
after the Commission received written notice of the completion 
of the Swan-Tyee transmission line. By letter filed October 4, 
2011, the Southeast Alaska Power Agency, which built the 
transmission line, reported that the Swan-Tyee transmission 
line was operational on October 21, 2009. Accordingly, I 
believe that the Commission is currently required to lift the 
stay no later than October 4, 2017.
    S. 2046 would require the Commission to stay the license, 
upon the licensee's request, for a period of no more than 10 
years after the date of enactment of the bill, make the 
effective date of the license the date on which the stay is 
lifted, and grant up to three two-year extensions of the 
construction deadline. Given the policy of the last several 
Chairmen that I discussed above, and that S. 2046 could result 
in a commencement of construction deadline more than 30 years 
after the project license was issued, I do not support S. 2046.
    As you know, I recently spoke at the National Hydropower 
Association meeting in Anchorage and met with a number of 
hydropower operators. I understand the importance of hydropower 
for communities in Alaska and elsewhere, and look forward to 
working with you on hydropower issues.
    If I can be of further assistance to you on this or any 
other Commission matter, please let me know.
            Sincerely,
                                             Norman C. Bay,
                                                          Chairman.

                        CHANGES IN EXISTING LAW

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, the Committee notes that no 
changes in existing law are made by the bill as ordered 
reported.
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