59–010 

Calendar No. 330 

114TH CONGRESS REPORT " ! SENATE 1st Session 114–185 

TERROR LAKE HYDROELECTRIC PROJECT 

DECEMBER 16, 2015.—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. 1583] 

The Committee on Energy and Natural Resources, to which was 

referred the bill (S. 1583) to authorize the expansion of an existing 

hydroelectric project, having considered the same, reports favorably 

thereon with an amendment in the nature of a substitute and recommends that the bill, as amended, do pass. 

The amendment is as follows: 

1. Strike all after the enacting clause and insert the following: 

SECTION 1. TERROR LAKE HYDROELECTRIC PROJECT UPPER HIDDEN BASIN DIVERSION AUTHORIZATION. 

(a) DEFINITIONS.—In this section: 

(1) TERROR LAKE HYDROELECTRIC PROJECT.—The term ‘‘Terror Lake Hydroelectric Project’’ means the project identified in section 1325 of the Alaska National Interest Lands Conservation Act (16 U.S.C. 3212), and which is Federal 

Energy Regulatory Commission project number 2743. 

(2) UPPER HIDDEN BASIN DIVERSION EXPANSION.—The term ‘‘Upper Hidden 

Basin Diversion Expansion’’ means the expansion of the Terror Lake Hydroelectric Project as generally described in Exhibit E to the Upper Hidden Basin 

Grant Application dated July 2, 2014 and submitted to the Alaska Energy Authority Renewable Energy Fund Round VIII by Kodiak Electric Association, Inc. 

(b) AUTHORIZATION.—The licensee for the Terror Lake Hydroelectric Project may 

occupy not more than 20 acres of Federal land to construct, operate, and maintain 

the Upper Hidden Basin Diversion Expansion without further authorization of the 

Secretary of the Interior or under the Alaska National Interest Lands Conservation 

Act (16 U.S.C. 3101 et seq.). 

(c) SAVINGS CLAUSE.—The Upper Hidden Basin Diversion Expansion shall be subject to appropriate terms and conditions included in an amendment to a license 

issued by the Federal Energy Regulatory Commission pursuant to the Federal 

Power Act (16 U.S.C. 791a et seq.), including section 4(e) of that Act (16 U.S.C. 

797(e)), following an environmental review by the Commission under the National 

Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.). 


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PURPOSE

The purpose of S. 1583 is to authorize the expansion of the existing Terror Lake hydroelectric project in Alaska. 

BACKGROUND AND NEED

Approval to construct the Terror Lake Hydroelectric Project in 

Alaska was granted by the Federal Energy Regulatory Commission 

in 1981. The 36 MW project has been in operation since the 1980s 

and the Kodiak Electric Association (KEA), which serves the city 

of Kodiak, including the nation’s largest U.S. Coast Guard Base 

and one of the country’s largest commercial fishing ports, now obtains 99.7 percent of its electric power from the hydroelectric 

project and another nearby wind farm. 

In order to avoid burning approximately two million gallons of 

diesel fuel to produce additional power, KEA, seeks to increase the 

amount of hydropower generated at the facility by expanding operations through the Upper Hidden Basin Diversion Expansion. The 

proposed expansion involves diverting five small streams located on 

Alaska State lands in the adjacent Upper Hidden Basin and allowing that water to flow into Terror Lake through an underground 

tunnel. The project would not involve adding turbines or equipment 

to the existing Terror Lake powerhouse. The expansion would increase the total production of electricity from the existing project 

by an additional 30 gigawatt-hours annually, representing a 25 

percent increase in power production. This will allow KEA to enhance its wind-hydropower integration system and its micro-grid 

energy storage technology. 

The existing Terror Lake Project is located within the Kodiak 

National Wildlife Refuge pursuant to a Special Use Permit granted 

by the U.S. Fish and Wildlife Service in 1981. S. 1583 authorizes 

construction, operation, and maintenance of the underground tunnel within the Kodiak National Wildlife Refuge as well. Insofar as 

the Upper Hidden Basin Diversion Expansion is an expansion of 

the Terror Lake Hydroelectric Project, the Committee expects the 

terms and special conditions of the Special Use Permit KD–81– 

0040 issued on July 21, 1981, as amended, to remain in effect and 

to apply to the expansion. 

LEGISLATIVE HISTORY

S. 1583 was introduced by Senator Murkowski on June 16, 2015. 

The Committee on Energy and Natural Resources held a full committee hearing on October 8, 2015 to consider the bill. 

At its business meeting on November 19, 2015, the Committee on 

Energy and Natural Resources, on a voice vote, ordered S. 1583 favorably reported as amended. 

COMMITTEE RECOMMENDATION AND TABULATION OF VOTES

The Senate Committee on Energy and Natural Resources, in 

open business session on November 19, 2015, by a majority voice 

vote of a quorum present, recommends that the Senate pass S. 

1583, if amended as described herein. 


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COMMITTEE AMENDMENTS

During its consideration of S. 1583, the Committee on Energy 

and Natural Resources adopted an amendment in the nature of a 

substitute to: provide definitions for the Terror Lake Hydroelectric 

Project and the Upper Hidden Basin Diversion Expansion; limit the 

Federal land that may be used for the project to no more than 20 

acres; legislatively authorize use of the refuge for the construction, 

operation, and maintenance of the diversion tunnel without further 

action by the Secretary of the Interior; and clarify that the Federal 

Energy Regulatory Commission’s authorization of the diversion 

project will not be subject to the provisions of title XI of the Alaska 

National Interest Lands Conservation Act. The amendment is further described in the section-by-section analysis. 

SECTION-BY-SECTION ANALYSIS

Section 1. Terror Lake Hydroelectric Project Upper Hidden Basin 

Diversion Authorization. 

Section 1(a) defines key terms. 

Section 1(b) authorizes the licensee to occupy up to 20 acres of 

Federal land to construct, operate, and maintain the Upper Hidden 

Basin Diversion Expansion without further authorization of the 

Secretary. It also clarifies that authorization of the expansion is 

not subject to title XI of the Alaska National Interest Lands Conservation Act. 

Section 1(c) clarifies that the expansion of the Terror Lake Hydroelectric Project is still subject to the Federal Energy Regulatory 

Commission’s hydropower licensing proceedings pursuant to the 

Federal Power Act, including section 4(e) of that Act, as well as the 

National Environmental Policy Act of 1969. 

COST AND BUDGETARY CONSIDERATIONS

The following estimate of costs of this measure has been provided 

by the Congressional Budget Office: 

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, December 9, 2015. 

Hon. LISA MURKOWSKI, 

Chairman, Committee on Energy and Natural Resources, 

U.S. Senate, Washington, DC. 

DEAR MADAM CHAIRMAN: The Congressional Budget Office has 

prepared the enclosed cost estimate for S. 1583, a bill to authorize 

the expansion of an existing hydroelectric project. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Megan Carroll. 

Sincerely, 

KEITH HALL. 

Enclosure. 

S. 1583—A bill to authorize the expansion of an existing hydroelectric project 

S. 1583 would specify that the licensee of the Terror Lake hydroelectric project (number 2743), located within the Kodiak National 


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Wildlife Refuge in Alaska, can expand that project to occupy not 

more than 20 acres of additional federal land. Under the bill, the 

proposed expansion would require no further approval by the Secretary of the Interior. 

CBO estimates that enacting S. 1583 would not significantly affect the federal budget. According to the Department of the Interior, the federal lands that would be affected by the proposed expansion currently generate no significant receipts from programs to 

develop natural resources and are not expected to do so in the future. As a result, CBO expects that the proposed expansion would 

not affect offsetting receipts (which are treated as reductions in direct spending). CBO also expects that enacting S. 1583 could have 

a minor impact on spending by the Federal Energy Regulatory 

Commission (FERC), which regulates the Terror Lake hydroelectric 

project. Because FERC recovers 100 percent of its costs through 

user fees, however, 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. 1583 would not affect direct spending or revenues; 

therefore, pay-as-you-go procedures do not apply. CBO estimates 

that enacting S. 1583 would not increase net direct spending or onbudget deficits in any of the four consecutive 10-year periods beginning in 2026. 

S. 1583 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. 1583. 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. 1583, as ordered reported. 

CONGRESSIONALLY DIRECTED SPENDING

S. 1583, 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

The letter from the Chairman of the Federal Energy Regulatory 

Commission on S. 1583 follows: 


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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. 

Æ 


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