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[Federal Register: October 26, 2010 (Volume 75, Number 206)]
[Notices]               
[Page 65615-65618]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26oc10-42]                         

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DEPARTMENT OF ENERGY

 
Conditional Commitment for a Federal Loan Guarantee for Project 
Financing for Southwest Intertie Project--South

AGENCY: U.S. Department of Energy, Loan Programs Office.

ACTION: Record of decision.

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SUMMARY: The U.S. Department of Energy (DOE) has decided to offer Great 
Basin Transmission, LLC (Great Basin), a conditional commitment for a 
Federal loan guarantee for partial financing of the 235-mile southern 
portion of the Southwest Intertie Project (SWIP), a proposed 500-
kilovolt (kV) transmission line that would extend from southern Nevada 
to southern Idaho. This Record of Decision (ROD) is based on the 
analysis in the Final Environmental Impact Statement for Project 
Financing for Southwest Intertie Project--South (SWIP South) (DOE/EIS-
0443, January 2010) (DOE FEIS). The DOE FEIS consists of a cover sheet 
for the January 2010 adoption of the Bureau of Land Management (BLM) 
1993 Southwest Intertie Project Environmental Impact Statement and 
Proposed Plan Amendment (SWIP EIS) and the BLM 2008 Environmental 
Assessment for the Southwest Intertie Project Southern Portion NV-040-
07-048 (SWIP South EA). This ROD also reflects minor modifications to 
the Great Basin proposal and new information developed since DOE issued 
its FEIS.
    DOE's offer of a conditional commitment for a loan guarantee for 
SWIP South is authorized under Title XVII of the Energy Policy Act of 
2005, as amended by Section 406 of the American Recovery and 
Reinvestment Act of 2009 (Recovery Act). This conditional commitment to 
provide a Federal loan guarantee is contingent upon Great Basin 
satisfying all precedent funding obligations, and all other 
contractual, statutory, regulatory, environmental compliance, and other 
requirements specified by DOE. DOE has prepared this ROD in accordance 
with the Council on Environmental Quality regulations (40 CFR Parts 
1500-1508) for implementing the National Environmental Policy Act 
(NEPA), and DOE's NEPA Implementing Procedures (10 CFR Part 1021).

FOR FURTHER INFORMATION CONTACT: For further information about DOE's 
decision, contact Carol Hammel-Smith, NEPA Document Manager, 
Environmental Compliance Division, Loan Programs Office at 
carol.hammel-smith@hq.doe.gov. Ms. Hammel-Smith can be reached by mail 
at the U.S. Department of Energy, 1000 Independence Avenue, SW., LP-10, 
Washington, DC 20585. For information on the DOE NEPA process, contact 
Carol Borgstrom, Director, Office of NEPA Policy and Compliance, at 
(202) 586-4600 or (800) 472-2756, or by facsimile at (202) 586-7031. 
Ms. Borgstrom can be reached by mail at the U.S. Department of Energy, 
1000 Independence Avenue, SW., GC-54, Washington, DC 20585.

SUPPLEMENTARY INFORMATION:

Project Background

    SWIP South would begin at the existing Harry Allen Substation, 
located in Dry Lake, Nevada, approximately 20 miles northeast of Las 
Vegas, Nevada, and would run north to the proposed Thirtymile 
Substation, located approximately 18 miles northwest of Ely, Nevada, 
where it would interconnect with Sierra Pacific Power Company's 
existing Falcon-Gonder 345-kV transmission line. The SWIP South would 
traverse approximately 235 miles through parts of White Pine, Nye, 
Lincoln, and Clark counties in Nevada, and would consist of self-
supporting and guyed structures placed approximately 1,200 to 1,500 
feet apart. Because of its location SWIP South could be a vital link 
for distributing power from renewable energy sources to adjacent states 
that have adopted specific renewable energy standards. The SWIP South 
would have the potential to provide up to 600 megawatts of renewable 
energy-derived electricity to fulfill renewable energy standards.
    The proposed project seeking a DOE loan guarantee also includes two 
elements related to the Falcon-Gonder transmission line: The Falcon 
Substation Upgrades and a Backup Communications System. Falcon 
Substation is an existing 345-kV switchyard owned by NV Energy (NVE) 
and located in Boulder Valley approximately 40 miles northeast of 
Battle Mountain, Nevada. SWIP South would connect to the Falcon-Gonder 
transmission line at the proposed Thirtymile Substation. The addition 
of the SWIP South line necessitates upgrades to NVE's Falcon Substation 
to improve the existing grid system's stability. The equipment included 
in the upgrade would consist of a 345-kV

[[Page 65616]]

fixed and/or series capacitor bank and other facilities as required for 
system stability mitigation. Access to Falcon Substation during 
construction and operation of the expanded facility would be provided 
via existing access roads.
    The Backup Communications System includes a communications network 
consisting of 16 microwave towers (on expanded existing sites and new 
sites) that would provide additional operational control to the primary 
fiber optic communications technology. The proposed communications 
towers would range in height from 80 feet to 300 feet. For each 
proposed site, the approximate area required would be up to 200 feet by 
150 feet (0.7 acre), including ancillary support equipment and a small 
buffer area surrounding the site. Eight of the sites would require new 
graded access roads and/or power distribution lines.

Purpose and Need for Agency Action

    Title XVII of the Energy Policy Act of 2005 (42 U.S.C. 16511-
16514), as amended by Section 406 of the Recovery Act, authorizes DOE 
to issue loan guarantees in support of debt financing for transmission 
infrastructure investment projects located in the United States. Title 
XVII as amended authorizes a new program for rapid deployment of 
renewable energy and electric power transmission projects (the Section 
1705 Program). Section 1705 authorizes loan guarantees for ``electric 
power transmission projects, including upgrading and reconductoring 
projects'' that commence construction no later than September 30, 2011.

DOE's Proposed Action

    DOE's proposed action is to offer Great Basin a conditional 
commitment for a Federal loan guarantee for partial financing of Great 
Basin's interest in SWIP South. Great Basin submitted an application to 
DOE to obtain a loan guarantee for financing Great Basin's interest in 
SWIP South--75% ownership interest in the SWIP South segment. The DOE 
loan guarantee would apply to no more than 80% of that share and other 
associated eligible costs. The balance of SWIP South--25% ownership 
interest--would be acquired by NVE and financed separately. The NVE 
subsidiaries with ownership in the 25% interest would include Nevada 
Power Corporation and Sierra Pacific Power Corporation.

NEPA Review

    In July 1993, BLM completed the SWIP EIS in cooperation with the 
U.S. Forest Service, Bureau of Reclamation, National Park Service, and 
Bureau of Indian Affairs. The SWIP EIS analyzed the environmental 
impacts that would be associated with construction and operation of 
SWIP South and SWIP North, and addressed public comment. The 
environmental mitigation measures for SWIP South and SWIP North were 
specified in the ROD issued by BLM on December 14, 1994 (59 FR 30678), 
herein referred to as the BLM ROD. In 2008, BLM prepared the SWIP South 
EA to consider the impacts of amending the previously approved Right-
of-Way (ROW) Grants to include a 4-mile extension on the southern end 
of SWIP South to allow interconnection with the existing Harry Allen 
Substation. The amendment included a shift in the location on the 
northern end of less than one mile to allow connection to the newly 
proposed Thirtymile Substation and to the existing Falcon-Gonder 345-kV 
transmission line. The SWIP South EA also provided an update on the key 
resource areas and impacts from the 1993 SWIP EIS. BLM issued a Finding 
of No Significant Impact (FONSI) on the SWIP South EA in July 2008.
    In accordance with 40 CFR 1506.3, DOE, through its Western Area 
Power Administration (Western), on January 19, 2010, adopted the BLM's 
1993 SWIP EIS or 2008 SWIP South EA to meet its NEPA obligations 
related to a proposal to finance part of SWIP South. The notice of 
adoption was published by the Environmental Protection Agency on 
February 19, 2010 (75 FR 7479). Western did not recirculate the SWIP 
EIS or SWIP South EA as a draft DOE EIS because the actions covered by 
the original SWIP EIS and SWIP South EA were substantially the same as 
those proposed by Western. Although Western has decided not to pursue 
its proposed financial assistance, DOE has decided to conditionally 
support SWIP South through DOE's Loan Guarantee Program.
    BLM evaluated the Falcon Substation Upgrades described above as 
part of NVE's proposed One Nevada Line (ON Line) project, a 
transmission line similar to the SWIP South in design and geographic 
scope. BLM's evaluation, the Draft Supplemental Environmental Impact 
Statement for the ON Line Project, herein referred to as ON Line DSEIS 
(BLMNV/EL/EIS-GI-10/01+1793; DES 09-50), was published on November 20, 
2009, and provides detailed information on the environmental effects of 
the Falcon Substation Upgrades. None of the 19 comment letters received 
concern the Falcon Substation Upgrades; therefore no changes are 
expected with respect to the Falcon Substation Upgrades when BLM issues 
the final SEIS.
    The NVE microwave system upgrades were evaluated by BLM in the 
Environmental Assessment--NV Energy Microwave and Mobile Radio Project, 
herein referred to as the Microwave EA, (DOI-BLM-NV-L 020-2009-0024-
EA), published on August 27, 2010. BLM simultaneously issued a Finding 
of No Significant Impact (FONSI) and Decision Record (BLM N-84551-
84563; N-85487 and DOI-BLM-NV-L000-2009-0024 EA, respectively) based on 
the environmental effects evaluated and disclosed in the Microwave EA. 
The Microwave EA evaluated 14 of the 16 communication sites proposed by 
Great Basin. Two locations on private land were not evaluated since 
BLM's ROW grant will not be applicable to those sites. DOE has 
evaluated these sites, as discussed below.

Environmental Impacts of the Falcon Substation Upgrades and the Backup 
Communications System

    This section describes the potential environmental impacts of the 
Falcon Substation Upgrades and the Backup Communications System. This 
discussion is based on the ON Line DSEIS and the Microwave EA.
    DOE evaluated the environmental impacts of the Falcon Substation 
Upgrades that were analyzed by BLM in the ON Line DSEIS. Chapters 3 and 
4 identify minor environmental effects to air emissions (mitigatable 
through gravelling) and housing in Eureka or Elko Counties (during 
construction); low potential for encountering paleontological 
resources; and no adverse impacts to other resources.
    DOE also evaluated the impacts of the Backup Communications System 
as analyzed in the Microwave EA, and found that impacts would be small 
or not adverse with adoption of mitigation measures and best management 
practices.
    A migratory bird survey would be required prior to any disturbance 
during migratory bird breeding and nesting seasons; monitoring/
reporting would be implemented. DOE also evaluated the two proposed 
communications sites on private land that were not analyzed in the BLM 
Microwave EA. Due to their location at existing facilities with access 
roads and power, the impacts of constructing and operating these new 
communications towers would be low. Both sites include pre-disturbed 
vegetation and wildlife habitat, and low potential for impacts to 
cultural resources due to hilltop locations.
    The environmental impacts associated with the NVE communications 
system expansion, including the sites to be located on BLM land and on 
private

[[Page 65617]]

land, would be brief in duration and would be minor or would be 
minimized or offset by the mitigation measures required by BLM. 
Further, the equipment associated with the NVE communications system 
expansion is not substantially different from the project features 
previously evaluated in DOE's EIS. Further, these projects are covered 
by DOE's NEPA categorical exclusion B1.19 (Appendix B to Subpart D, 10 
CFR Part 1021), which is applicable to siting, construction, and 
operation of microwave and radio communications towers and associated 
facilities.

Review of Comments Received on DOE's 2010 Adoption of the 1993 SWIP EIS 
and 2008 SWIP South EA

    As part of its decision process, DOE considered comments received 
on the DOE FEIS. In addition, DOE reviewed BLM's 2007 ``Documentation 
of Land Use Plan Conformity and NEPA Adequacy'' for SWIP South; the 
BLM-approved Construction, Operation & Maintenance Plan for the SWIP-
Southern Portion (August 2010); and the BLM-approved Biological 
Assessment (2007) and the Biological Opinion (2007 and as amended in 
2010) for SWIP South.
    DOE reviewed comments received on February 22, 2010, from the 
Western Watersheds Project (WWP) in response to DOE's January 2010 
adoption. WWP's comment attached two comment letters that WWP had 
previously submitted to BLM on November 11, 2007, as well as WWP's 
October 10, 2008, response to BLM and the Intervenors in the Interior 
Board of Land Appeals (IBLA) (which ruled against WWP's appeal on 
November 12, 2008).
    In its February 2010 communication to Western, WWP recommended that 
DOE deny funding for SWIP South and instead award to decentralized 
energy projects that would be accessed locally. DOE has determined that 
decentralized projects would not be eligible for loan guarantees under 
this loan solicitation since DOE was granted Recovery Act authority to 
provide funding for transmission projects, with priority to those that 
facilitate the delivery of renewable power. WWP's recommendation would 
not meet DOE's purpose and need for its loan guarantee action. WWP also 
raised concerns that the SWIP project could facilitate industrial 
development that could cause the destruction of sagebrush wild lands. 
DOE reviewed the 1994 SWIP EIS and the 2008 Interior Board of Land 
Appeals Westerm Watersheds Project v Bureau of Land Management and 
Great Basin Transmission, LLC (IBLA No.2008-252 addressing WWP's 
challenge to the 2008 BLM EA and FONSI for the SWIP-Southern Portion). 
DOE has determined that BLM adequately addressed potential development 
in the FEIS and that the 2008 appeals process established that there 
has not been sufficient change in anticipated cumulative impacts 
considered for the SWIP line to require a supplemental EIS. DOE also 
notes that other energy projects that might be located in sagebrush 
habitat on public lands would only be permitted if they have been 
reviewed under NEPA and are consistent with Federal law and policy.
    WWP's comments included claims of segmentation of NEPA review for 
the SWIP project; failure to consider alternatives; and inadequate 
review of impacts associated with invasive weeds, the desert tortoise 
and sage grouse, soil erosion, off-highway vehicle use, wild horse 
management, global warming, and cumulative impacts.In evaluating WWP's 
claims, DOE reviewed and considered the relevant materials in the BLM 
administrative record for SWIP South and found that these issues had 
been adequately considered.
    DOE reviewed the 19 comments that BLM received on its 2009 analyses 
addressing the Falcon Substation Upgrades and the Backup Communications 
System. None concern the Falcon Substation Upgrades, and therefore few 
changes are expected for the Final SEIS that BLM plans to issue at the 
end of October 2010. After a 30-day protest period, BLM expects to 
issue its ROD and ROW by December 2010.
    DOE also reviewed four comment letters received on the Microwave 
EA. A 30-day comment period began on April 12, 2010, and closed on May 
14, 2010. The State Historic Preservation Officer indicated completion 
of a Section 106 consultation for the Lower Spruce site; the Nevada 
Department of Wildlife recommended installing gates and anti-perching 
measures; the Southern Nevada Water Authority recommended construction 
coordination; and the Elk County Commissioners indicated support of the 
project. On August 27, 2010, BLM issued a FONSI for the Microwave EA.
    Based on review of the documents pertaining to the IBLA review, DOE 
finds that the issues raised by WWP have been adequately addressed. 
Further, as a result of its review of the comments on the ON Line DSEIS 
and Microwave EA, DOE concludes that the comments do not present any 
significant new circumstances or information relevant to environmental 
concerns bearing on SWIP South, or associated potential environmental 
impacts.

Alternatives Considered

    DOE considered two alternatives: The Proposed Action and No Action. 
Under the Proposed Action, DOE would offer Great Basin a conditional 
commitment to partially finance the proposed SWIP South transmission 
line. Under No Action, SWIP South most likely would not be built and 
the potential impacts discussed above and their related mitigation 
would not occur, nor would this transmission line be available to 
transmit power to meet the renewable energy standards in adjoining 
states.

Environmentally Preferred Alternative

    The Proposed Action is the Environmentally Preferred Alternative 
for several reasons. First, the Proposed Action furthers the goals of 
Section 1705 of the Energy Policy Act of 2005 to promote the rapid 
deployment of renewable energy and electric power transmission projects 
that could reduce the generation of greenhouse gas and other air 
pollutants created by non-renewable, fossil-fuel generation sources.
    Also, because neighboring states that could be serviced by SWIP 
South have renewable energy standards, SWIP South provides the capacity 
to deliver up to 600 megawatts of renewable energy-derived electricity 
to fulfill the requirements of these states. Specifically, Nevada is 
required to deliver 20% of its megawatt capacity generated by renewable 
energy sources by 2015; Arizona, 15% by 2025; California, 33% by 2030, 
and Colorado, 20% by 2020.

Consultation

    A Section 106 review under the National Historic Preservation Act 
(NHPA) and Tribal consultation have been completed by BLM for the 
proposed SWIP South project. An NHPA Section 106 programmatic agreement 
was finalized during the DOE FEIS process, requiring that prior to 
construction, a preconstruction field survey and a mitigation plan be 
completed and approved. In July, 2010, the BLM submitted to the Nevada 
State Historic Preservation Office (SHPO) the Historic Properties 
Treatment Plans for SWIP South entitled: ``Historic Properties 
Treatment Plan, Southwest Intertie Project, Southern Portion White 
Pine, Nye, Lincoln, and Clark Counties, Nevada, Volumes 1a-c (BLM 
Report Number 8111NG040-2009-1593d Volumes 1a-c).'' The SHPO concurred 
with the BLM determination that the three submitted historic treatment 
plans, and BLM Archaeologist

[[Page 65618]]

monitoring and consulting activities would be adequate treatment.
    An Endangered Species Act (ESA) (16 U.S.C. 1536) Section 7 
consultation was completed by BLM during the DOE FEIS NEPA process. The 
Service has issued four Biological Opinions for the proposed project: 
(1) May 1993; (2) March 1994, which included an analysis of potential 
effects to the desert tortoise and its designated critical habitat; (3) 
December 2007, which incorporated project realignments and the use of 
H-frames with perching deterrents within desert tortoise critical 
habitat; and (4) June and July 2010, which respectively amended the 
2007 Biological Opinion to incorporate an additional tower design 
(tubular guyed-V tower) with perching deterrents, and modifications to 
include additional disturbance of desert tortoise habitat due to a 
minor calculation error.

Mitigation

    DOE will require Great Basin to employ all practicable means to 
avoid or minimize environmental harm as a result of the proposed 
action. The loan guarantee agreement between DOE and Great Basin would 
require that Great Basin implement all project-specific environmental 
protection measures specified in the ``Construction, Operation, and 
Maintenance Plan for the Southwest Intertie Project 500-kV Transmission 
Line; SWIP--Southern Portion; SWIP Central Portion (COM Plan),'' and in 
the BLM Notice to Proceed, issued in August 2010. After the DOE loan 
guarantee is retired, enforcement of environmental protection will 
continue through the BLM ROW grant provisions for the life of the 
project.
    The NEPA analysis completed in the DOE FEIS indicates that SWIP 
South would result in low environmental impacts after mitigation 
measures required for BLM's ROW are implemented. The mitigation 
measures are a condition of BLM issuance of the ROW that provides Great 
Basin access to construct, operate, and maintain SWIP South on BLM 
land. The BLM documents the conditions under which Great Basin must 
operate in the COM Plan approved by BLM in 2010. The COM Plan 
incorporates the mitigation measures required by the DOE FEIS, the 2010 
Historic Properties Treatment Plan, and the 2010 Biological Opinion.

Decision

    DOE has decided to offer Great Basin a conditional commitment for a 
Federal loan guarantee for partial financing of SWIP South. This 
decision is contingent on Great Basin satisfying all precedent funding 
obligations, and all other contractual, statutory, regulatory, 
environmental compliance, and other requirements specified by DOE.
    In reaching this decision, DOE reviewed the SWIP NEPA documentation 
and considered the potential impacts of the selected alternative with 
implementation of the stipulated mitigation measures.
    DOE has prepared this ROD in accordance with the Council on 
Environmental Quality regulations (40 CFR Parts 1500-1508) for 
implementing NEPA and DOE's NEPA Implementing Procedures (10 CFR Part 
1021).

Basis for Decision

    DOE has determined that the potential environmental impacts 
analyzed in the DOE FEIS will be minor after implementation of the 
mitigation provisions for the SWIP South BLM ROW. The mitigation 
measures will be reflected in the DOE Loan Guarantee Common Agreement, 
and will remain in the BLM COM Plan for the duration of the granted 
ROW.
    DOE has also determined that potential environmental impacts 
associated with the Falcon Substation Upgrades and the Backup 
Communications System would not be adverse or can be characterized as 
minor. DOE has determined that no further analysis is required, and 
incorporates by reference the environmental analyses conducted on these 
project elements. Further, DOE has also considered the Congressional 
direction specified in Section 2003 of H.R. 4899, the 2010 Supplemental 
Appropriations Act, Public Law 111-212, effective on July 29, 2010 (the 
2010 Supplemental Appropriations Act) in its decision to issue this 
ROD. The 2010 Supplemental Appropriations Act allows DOE to provide or 
facilitate Federal financing for SWIP under the American Recovery and 
Reinvestment Act of 2009 (Pub. L. 111-5; 123 Stat. 115), or the Energy 
Policy Act of 2005 (42 U.S.C. 15801 et seq.), based on the 
comprehensive reviews and consultations performed by BLM under the 
Secretary of the Interior.

    Issued in Washington, DC, on October 18, 2010.
Jonathan M. Silver,
Executive Director, Loan Programs Office.
[FR Doc. 2010-27046 Filed 10-25-10; 8:45 am]
BILLING CODE 6450-01-P
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