29–006 

113TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 1st Session 113–24 

BUREAU OF RECLAMATION SMALL CONDUIT 

HYDROPOWER DEVELOPMENT AND RURAL JOBS ACT 

MARCH 25, 2013.—Committed to the Committee of the Whole House on the State 

of the Union and ordered to be printed 

Mr. HASTINGS of Washington, from the Committee on Natural 

Resources, submitted the following 

R E P O R T 

together with 

DISSENTING VIEWS 

[To accompany H.R. 678] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Natural Resources, to whom was referred the 

bill (H.R. 678) to authorize all Bureau of Reclamation conduit facilities for hydropower development under Federal Reclamation 

law, and for other purposes, having considered the same, report favorably thereon without amendment and recommend that the bill 

do pass. 

PURPOSE OF THE BILL

The purpose of H.R. 678 is to authorize all Bureau of Reclamation conduit facilities for hydropower development under Federal 

Reclamation law. 

BACKGROUND AND NEED FOR LEGISLATION

Congress established the Bureau of Reclamation (Reclamation) in 

1902 to ‘‘make the desert bloom.’’ To this day, Reclamation’s water 

projects play a significant role in the West by providing a reliable 

source of water and power for irrigated agriculture and rural and 

urban communities. While the larger, multi-purpose projects such 

as Grand Coulee and Hoover Dams are relatively well-known, Reclamation has a number of much smaller projects that significantly 


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contribute to the agency’s original mission of delivering water and 

power. 

Many of these smaller, single-purpose water supply projects were 

either authorized by Congress or created administratively over the 

last century. At the time of their creation, hydropower was usually 

not envisioned as a project component due to economics, lack of 

technology and other factors. Today, with the improved ability to 

harness the energy of moving water in canals and pipelines (collectively known as ‘‘conduits’’), many are looking at hydropower development on these smaller projects. Combined with non-federal conduits, there is enormous potential to develop vast amounts of hydropower at existing water supply infrastructure. For example, in 

the State of Colorado alone, over 1,400 megawatts or the equivalent of the original hydropower output of Glen Canyon Dam on the 

Colorado River—could be produced from conduit hydropower development. Indeed, Reclamation found in a March 2012 report that 

over 373 of its sites had the potential for hydropower development: 

Energy and capacity by state Canal sites Potential installed capacity 

(kW) 

Potential Annual Energy 

(kWh) 

AZ ................................................................ 26 5,061 28,464,753 

CA ................................................................ 20 1,570 4,802,925 

CO ............................................................... 28 27,286 100,230,315 

ID ................................................................. 9 2,771 11,451,814 

MT ............................................................... 32 9,885 26,316,565 

NE ................................................................ 30 5,501 13,793,995 

NM ............................................................... 8 1,427 3,573,029 

NV ................................................................ 16 1,533 8,671,966 

OR ............................................................... 68 20,404 75,943,044 

SD ................................................................ 1 131 572,000 

UT ................................................................ 12 3,552 5,965,031 

WA ............................................................... 2 1,047 2,885,357 

WY ............................................................... 121 23,460 82,548,053 

H.R. 678 seeks to jumpstart hydropower development on Reclamation conduits by reducing unnecessary and duplicative administrative and regulatory costs while protecting the original Congressionally-authorized purposes of these facilities from any unmitigated financial or physical impacts as a result of such development. 

The legislation makes it clear that hydropower is explicitly authorized at Reclamation’s conduits. This would allow Reclamation to 

issue a ‘‘lease of power privilege,’’ which would give a non-federal 

entity the right to generate hydropower and pay a rental fee to the 

federal government for such generation at a specific Reclamation 

facility. The legislation requires Reclamation to offer the lease of 

power privilege first to the entity operating the conduit or the conduit’s direct beneficiaries. Most Reclamation water supply and delivery projects have an arrangement where operation and maintenance activities are transferred to the local water beneficiary as a 

way to reduce paperwork and other costs. This ‘‘right of first refusal’’ provision would significantly decrease conduit hydropower 

planning and study time by reducing staffing costs and time affiliated with analyzing competing and multiple conduit development 

applications. If the water beneficiary refuses development under 

Reclamation’s terms and conditions, Reclamation could consider 

other proposals. 

The bill also attempts to reduce duplicative regulatory costs and 

paperwork while protecting the environment. A substantial reguVerDate Mar 15 2010 22:46 Mar 26, 2013 Jkt 029006 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\HR024.XXX HR024

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latory barrier to future conduit hydropower development is duplicative environmental analysis. The hydropower units envisioned in 

H.R. 678 would be installed on already disturbed ground within existing man-made facilities that do not contain endangered fish and 

wildlife. In addition, the water projects in which the hydropower 

units would be contained have already gone through federal environmental review. Despite these facts, another National Environmental Policy Act (NEPA) analysis must still be done under existing federal regulations. For some, this has created a chilling effect 

on hydropower investment. For example, at a Water and Power 

Subcommittee hearing in 2011, one witness indicated that installing 15 very small hydropower units on a nearby Reclamation canal 

system in Arizona could cost over $450,000—or $30,000 per unit— 

for additional NEPA reviews that would ultimately conclude no environmental impacts. These paperwork costs would be greater than 

the actual capital cost of the hydropower units. 

These costs and their time-consuming nature help make most 

conduit hydropower installations cost prohibitive. For this reason, 

H.R. 678 exempts ‘‘small conduit hydropower’’ (5 megawatts or 

less) from NEPA, while retaining NEPA application for larger installations and for transmission siting on federal land. Each facility 

would still be subject to environmental laws such as the Clean 

Water Act and other laws that could require permits. 

Based on past consideration of this bill during the 112th Congress, Reclamation instituted a NEPA Categorical Exclusion policy 

on conduit hydropower development in September 2012. However, 

six months later, this new policy has not been implemented on any 

new conduit hydropower development at Reclamation’s facilities. In 

addition, the policy is administrative in nature and can be subject 

to change. 

The net effect of H.R. 678 is that hydropower development would 

be explicitly authorized at almost 47,000 miles of Reclamation’s 

conduits and that it will be developed at a cost-effective way to 

produce renewable and emissions-free energy that will empower 

local economic development and jobs while generating federal revenue and protecting the environment. 

COMMITTEE ACTION

H.R. 678 was introduced on February 13, 2013, by Congressman 

Scott Tipton (R–CO). The bill was referred to the Committee on 

Natural Resources, and within the Committee to the Subcommittee 

on Water and Power. On March 5, 2013, the Subcommittee held a 

hearing on the bill. On March 20, 2013, the Full Natural Resources 

Committee met to consider the bill. The Subcommittee on Water 

and Power was discharged by unanimous consent. Congresswoman 

Grace Napolitano (D–CA) offered an amendment designated .004; 

the amendment was not adopted by voice vote. The bill was then 

adopted and ordered favorably reported to the House of Representatives by a bipartisan roll call vote of 17 to 12, as follows: 


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srobinson on DSK4SPTVN1PROD with HEARINGInsert offset folio 5 here HR24.001

Date: March 20,2013 

Committee on Natural Resources 

u.s. House of Representatives 

113 th Congress 

Recorded Vote #: I 

Meeting on! Amendment on: H.R. 678 - Adopted and favorably reported to the House of Representatives by a 

roll call vote of 17 yeas and 12 nays. 

MEMBERS Yea Nav Pres MEMBERS Yea Nay Pres 

Mr. Hastings, W A, Chairman X Mr. Dnncan, SC X 

Mr. Markey, MA, Ranking M,. Hanabusa, HI X 

Mr. Young,AK X Mr. Tipton, CO X 

Mr. DejilZio, OR X Mr. Cardenas, CA 

Mr. Gohmert, TX Mr. Gosar, AZ 

Mr. Faleomavaega, AS Mr. Horsford, NV X 

Mr. Bishop, UT X Mr. Labrador, ID X 

Mr. Pal/one, NJ Mr. Huffman, CA X 

Mr. Lamborn, CO X Mr. Sontberland, FL X 

Mrs. Napolitano, CA X Mr. Ruiz, CA X 

Mr. Wittman, VA Mr. Flores, TX X 

Mr. Holt,NJ X Ms. Shea-Porter, NH X 

Mr. Broun, GA X Mr. Runyan, NJ 

Mr. Grijalva, AZ X Mr. Lowenthai, CA X 

Mr. Fleming, LA Mr. Amodei, NV 

Ms. Bordallo, GU Mr. Garcia, FL 

Mr. McClintock, CA X I Mr. Mullin, OK 

Mr. Costa, CA X Mr. Cortwri"ht, PA 

Mr. Thompson, PA Mr. Stewart, UT 

Mr. Sablan, CNMI Mr. Daines, MT X 

Ms. Lummis, WY X Mr. Cramer, ND 

Mr. 

Ms. Tsongas, 

Beuishek, 

MA 

MI X 

X Mr. LaMalfa, CA tt Mr. Pieriuisi, PR X 

TOTALS 17 12 
5 

SECTION-BY-SECTION ANALYSIS

Section 1. Short title 

This Act may be cited as the ‘‘Bureau of Reclamation Small Conduit Hydropower Development and Rural Jobs Act.’’ 

Section 2. Authorization 

Section 2 amends Section 9(c) of the Reclamation Project Act of 

1939 to authorize ‘‘power’’ as a function at all Bureau of Reclamation conduits. This authorization will allow the agency to pursue 

hydropower development on conduits under its exclusive jurisdiction and within the framework of federal reclamation law. 

The section further amends Section 9(c) of the Reclamation 

Project Act of 1939 by adding a number of new provisions relating 

to small conduit hydropower development. Given the exclusive hydropower authorization, the bill requires the Bureau of Reclamation to offer the ‘‘lease of power privilege’’ (lease) first to the entity 

operating the conduit or the conduit’s direct water user beneficiaries. This provision reinforces and strengthens Reclamation’s 

current arrangement of giving irrigation districts the preference to 

lease hydropower projects on canals that the districts operate and 

maintain on behalf of the federal government. The Committee understands that these longtime operators/beneficiaries know the operating intricacies and primary water supply features of the respective Reclamation facility, as opposed to some outside, non-local interests not invested in water supply delivery. As such, the Committee expects Reclamation to work cooperatively and communicate 

directly with these operators/beneficiaries prior to and during the 

lease process, especially because a conduit’s primary purpose is to 

deliver water. This provision does not prohibit the operators/beneficiaries of the conduit facility from participating with any thirdparty interest in the hydropower development on the respective 

conduit. The Committee also expects Reclamation to undergo a 

good faith effort to allow the operators/beneficiaries a reasonable 

and justifiable time frame to accept or reject a conduit lease of 

power privilege offer. Such time frames would factor in the complexity of the facility, prior communication with, any stated concerns of the operators/beneficiaries and other matters. 

This section also streamlines the duplicative federal regulatory 

process impacting hydropower development covered in the bill. As 

referenced above, the facilities are man-made canals that have already gone through the National Environmental Policy Act (NEPA) 

process. This section also designates the Power Resources Office in 

Reclamation’s Denver headquarters as the lead office for small conduit development. Unfortunately, a number of irrigation districts 

pursuing hydropower have been unable to receive uniform answers 

from Reclamation on conduit development. This provision will set 

up a centralized location for uniform policy and procedure-setting 

purposes, yet does not prohibit area offices from implementing specific conduit development. 

Section two also clarifies that the Western Area Power Administration, the Bonneville Power Administration and the Southwestern Power Administration are not obligated to purchase or 

market the conduit hydropower generated at Reclamation facilities 

and that none of the costs associated with the generation shall be 


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assigned to these agencies’ power rates. This provision intends to 

allow the free market to decide who will purchase the conduit hydropower. This section also provides a number of water supply savings clauses. These provisions specifically ensure conduit hydropower development will not harm or impact existing water supplies 

and water deliveries and acknowledges that water used for conduit 

hydropower generation is incidental to water supply purposes. This 

incidental purpose specifically means hydropower development is 

subordinate to the original Congressionally-authorized water supply project purposes. 

The provisions also make clear that Reclamation shall notify and 

consult with the applicable water users benefitting from the conduit. The Committee expects the agency to communicate in written 

and verbal form with the operators and beneficiaries of a Reclamation conduit facility prior to issuing any lease of power privilege or 

when identifying a conduit for potential hydropower development. 

These operators/beneficiaries are acutely aware of facility operations and would provide valuable knowledge and experience to determine the feasibility of the contemplated small-scale hydropower 

development. 

The provisions also require the federal government to completely 

protect the planning, design, construction, operation, maintenance 

and other interests of the federally-owned conduit. The Committee 

expects Reclamation to work with the applicable conduit operator/ 

beneficiary on these terms and conditions prior to issuance. The 

Committee also expects that such terms and conditions will be 

written and detailed in nature, mandatory for the conduit hydropower developer, and shall be enforced by Reclamation. The Committee is aware that Reclamation has come under significant and 

justified criticism for not adequately communicating with operators/beneficiaries on existing conduit hydropower projects. Section 

2 also ensures that nothing in the bill shall alter or affect any existing agreements for the development of conduit hydropower 

projects or disposition of revenues. 

Finally, the section provides definitions for terms used in the bill. 

COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

Regarding clause 2(b)(1) of rule X and clause 3(c)(1) of rule XIII 

of the Rules of the House of Representatives, the Committee on 

Natural Resources’ oversight findings and recommendations are reflected in the body of this report. 

COMPLIANCE WITH HOUSE RULE XIII 

1. Cost of Legislation. Clause 3(d)(1) of rule XIII of the Rules of 

the House of Representatives requires an estimate and a comparison by the Committee of the costs which would be incurred in carrying out this bill. However, clause 3(d)(2)(B) of that rule provides 

that this requirement does not apply when the Committee has included in its report a timely submitted cost estimate of the bill prepared by the Director of the Congressional Budget Office under section 402 of the Congressional Budget Act of 1974. Under clause 

3(c)(3) of rule XIII of the Rules of the House of Representatives and 

section 403 of the Congressional Budget Act of 1974, the ComVerDate Mar 15 2010 22:46 Mar 26, 2013 Jkt 029006 PO 00000 Frm 00006 Fmt 6659 Sfmt 6602 E:\HR\OC\HR024.XXX HR024

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mittee has received the following cost estimate for this bill from the 

Director of the Congressional Budget Office: 

H.R. 678—Bureau of Reclamation Small Conduit Hydropower Development and Rural Jobs Act 

CBO estimates that enacting H.R. 678 would increase federal offsetting receipts by $1 million over the 2014–2023 period because it 

would authorize the Bureau of Reclamation to permit private entities to develop hydropower at certain facilities owned by the bureau. Pay-as-you-go procedures apply because enacting the legislation would increase offsetting receipts (a credit against direct 

spending). Enacting the bill would not affect revenues. 

H.R. 678 would clarify that the jurisdiction over small hydropower development by private entities on all bureau irrigation canals and conduits lies solely with the bureau. Under current law, 

the bureau or the Federal Energy Regulatory Commission (FERC) 

has jurisdiction over hydropower development at such facilities. 

CBO expects that this change would result in a small increase in 

receipts from hydropower development because the federal government collects no funds from project developers if a project is authorized by FERC. 

Typically the bureau’s agreements with private developers of hydropower facilities on small conduits generate annual receipts to 

the federal government ranging from about $10,000—at most facilities—up to $100,000 for a few larger sites. Selecting the lessee, negotiating the leasing contract, and constructing new facilities usually takes two to four years depending on the size of the project. 

Under the legislation, CBO expects that the federal government 

would receive some additional receipts beginning two years after 

enactment and that those additional collections would grow to 

about $200,000 a year by 2023. 

The Statutory Pay-As-You-Go Act of 2010 establishes budget reporting and enforcement procedures for legislation affecting direct 

spending or revenues. H.R. 678 would increase offsetting receipts 

beginning in 2015. The budgetary changes that are subject to those 

pay-as-you-go procedures are shown in the following table. 

CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 678, AS ORDERED REPORTED BY THE 

HOUSE COMMITTEE ON NATURAL RESOURCES ON MARCH 20, 2013 

By fiscal year, in millions of dollars— 

2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2013– 

2018 

2013– 

2023 

NET INCREASE OR DECREASE (¥) IN THE DEFICIT 

Statutory Pay-As-You-Go Impact .... 0 0 0 0 0 0 0 0 0 0 0 0 ¥1 

H.R. 678 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 Aurora Swanson. The 

estimate was approved by Theresa Gullo, Deputy Assistant Director for Budget Analysis. 

2. Section 308(a) of Congressional Budget Act. As required by 

clause 3(c)(2) of rule XIII of the Rules of the House of Representatives and section 308(a) of the Congressional Budget Act of 1974, 


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this bill does not contain any new budget authority, spending authority, credit authority, or an increase or decrease in revenues or 

tax expenditures. CBO estimates that enacting H.R. 678 would increase federal offsetting receipts by $1 million over the 2014–2023 

period because it would authorize the Bureau of Reclamation to 

permit private entities to develop hydropower at certain facilities 

owned by the bureau. 

3. General Performance Goals and Objectives. As required by 

clause 3(c)(4) of rule XIII, the general performance goal or objective 

of this bill is to authorize all Bureau of Reclamation conduit facilities for hydropower development under Federal Reclamation law. 

EARMARK STATEMENT

This bill does not contain any Congressional earmarks, limited 

tax benefits, or limited tariff benefits as defined under clause 9(e), 

9(f), and 9(g) of rule XXI of the Rules of the House of Representatives. 

COMPLIANCE WITH PUBLIC LAW 104–4 

This bill contains no unfunded mandates. 

COMPLIANCE WITH H. RES. 5 

1. Directed Rule Making. The Chairman does not believe that 

this bill directs any executive branch official to conduct any specific 

rule-making proceedings. 

2. Duplication of Existing Programs. This bill does not establish 

or reauthorize a program of the federal government known to be 

duplicative of another program. Such program was not included in 

any report from the Government Accountability Office to Congress 

pursuant to section 21 of Public Law 111–139 or identified in the 

most recent Catalog of Federal Domestic Assistance published pursuant to the Federal Program Information Act (Public Law 95–220, 

as amended by Public Law 98–169) as relating to other programs. 

PREEMPTION OF STATE, LOCAL OR TRIBAL LAW

This bill is not intended to preempt any State, local or tribal law. 

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, 

existing law in which no change is proposed is shown in roman): 

RECLAMATION PROJECT ACT OF 1939 

* * * * * * * 

SEC. 9. (a) * * * 

* * * * * * * 

(c) øThe Secretary is authorized to enter into contracts to furnish 

water¿ 

(1) The Secretary is authorized to enter into contracts to furnish water for municipal water supply or miscellaneous purVerDate Mar 15 2010 22:46 Mar 26, 2013 Jkt 029006 PO 00000 Frm 00008 Fmt 6659 Sfmt 6602 E:\HR\OC\HR024.XXX HR024

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poses: Provided, That any such contract either ø(1) shall¿ (A) 

shall require repayment to the United States, over a period of 

not to exceed forty years from the year in which water is first 

delivered for the use of the contracting party, with interest not 

exceeding the rate of 31⁄2 per centum per annum if the Secretary determines an interest charge to be proper, of an appropriate share as determined by the Secretary of that part of the 

construction costs allocated by him to municipal water supply 

or other miscellaneous purposes; or ø(2) shall¿ (B) shall be for 

such periods, not to exceed forty years, and at such rates as 

in the Secretary’s judgment will produce revenues at least sufficient to cover an appropriate share of the annual operation 

and maintenance cost and an appropriate share of such fixed 

charges as the Secretary deems proper, and shall require the 

payment of said rates each year in advance of delivery of water 

for said year. Any sale of electric power or lease of power privileges, made by the Secretary in connection with the operation 

of any project or division of a project, shall be for such periods, 

not to exceed forty years, and at such rates as in his judgment 

will produce power revenues at least sufficient to cover an appropriate share of the annual operation and maintenance cost, 

interest on an appropriate share of the construction investment 

at not less than 3 per centum per annum, and such other fixed 

charges as the Secretary deems proper: Provided further, That 

in said sales or leases preference shall be given to municipalities and other public corporations or agencies; and also to cooperatives and other nonprofit organizations financed in whole 

or in part by loans made pursuant to the Rural Electrification 

Act of 1936 and any amendments thereof. Nothing in this subsection shall be applicable to provisions in existing contracts, 

made pursuant to law, for the use of power and miscellaneous 

revenues of a project for the benefit of users of water from such 

project. The provisions of this subsection ørespecting the terms 

of sales of electric power and leases of power privileges shall 

be in addition and alternative to any authority in existing laws 

relating to particular projects¿ respecting the sales of electric 

power and leases of power privileges shall be an authorization 

in addition to and alternative to any authority in existing laws 

related to particular projects, including small conduit hydropower development. No contract relating to municipal water 

supply or miscellaneous purposes or to electric power or power 

privileges shall be made unless, in the judgment of the Secretary, it will not impair the efficiency of the project for irrigation purposes. 

(2) When carrying out this subsection, the Secretary shall 

first offer the lease of power privilege to an irrigation district or water users association operating the applicable 

transferred work, or to the irrigation district or water users 

association receiving water from the applicable reserved 

work. The Secretary shall determine a reasonable time 

frame for the irrigation district or water users association 

to accept or reject a lease of power privilege offer. 

(3) The National Environmental Policy Act of 1969 (42 

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power development, excluding siting of associated transmission on Federal lands, under this subsection. 

(4) The Power Resources Office of the Bureau of Reclamation shall be the lead office of small conduit hydropower activities conducted under this subsection. 

(5) Nothing in this subsection shall obligate the Western 

Area Power Administration, the Bonneville Power Administration, or the Southwestern Power Administration to purchase or market any of the power produced by the facilities 

covered under this subsection and none of the costs associated with production or delivery of such power shall be assigned to project purposes for inclusion in project rates. 

(6) Nothing in this subsection shall alter or impede the 

delivery and management of water by Bureau of Reclamation facilities, as water used for conduit hydropower generation shall be deemed incidental to use of water for the 

original project purposes. Lease of power privilege shall be 

made only when, in the judgment of the Secretary, the exercise of the lease will not be incompatible with the purposes 

of the project or division involved, nor shall it create any 

unmitigated financial or physical impacts to the project or 

division involved, and shall be on such terms and conditions as in the judgment of the Secretary in consultation 

with the appropriate irrigation district or water users association, will adequately protect the planning, design, construction, operation, maintenance, and other interests of the 

United States and the project or division involved. 

(7) Nothing in this subsection shall alter or affect any existing agreements for the development of conduit hydropower projects or disposition of revenues. 

(8) In this subsection: 

(A) CONDUIT.—The term ‘‘conduit’’ means any Bureau of Reclamation 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) IRRIGATION DISTRICT.—The term ‘‘irrigation district’’ means any irrigation, water conservation, multicounty water conservation district, or any separate 

public entity composed of two or more such districts 

and jointly exercising powers of its member districts. 

(C) RESERVED WORK.—The term ‘‘reserved work’’ 

means any conduit that is included in project works 

the care, operation, and maintenance of which has 

been reserved by the Secretary, through the Commissioner of the Bureau of Reclamation. 

(D) TRANSFERRED WORK.—The term ‘‘transferred 

work’’ means any conduit that is included in project 

works the care, operation, and maintenance of which 

has been transferred to a legally organized water users 

association or irrigation district. 


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(E) SMALL CONDUIT HYDROPOWER.—The term ‘‘small 

conduit hydropower’’ means a facility capable of producing 5 megawatts or less of electric capacity. 

* * * * * * * 


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DISSENTING VIEWS 

H.R. 678 seeks to generate more hydropower at existing facilities 

by developing conduit and in-canal hydropower. Just like water recycling, water efficiencies, and energy efficiencies projects across 

the west, small hydropower projects on existing water infrastructure can have a positive cumulative impact. 

H.R. 678 would amend the Reclamation Project Act of 1939 to facilitate the private development of small conduit hydropower at Bureau of Reclamation (Reclamation) facilities. The legislation clarifies the question of whether Federal Energy Regulatory Commission (FERC) or Reclamation has jurisdiction over private hydropower development on Reclamation conduits by authorizing Reclamation to develop power at all such facilities. Small conduit hydropower projects are defined as projects producing 5-megawatts or 

less. The Power Marketing Administrations are not obligated to 

purchase or market the power produced. Unfortunately, the legislation also contains an unnecessary National Environmental Policy 

Act (NEPA) waiver. 

Almost identical legislation (H.R. 2842) was considered by the 

House during the 112th Congress. Since H.R. 2842’s consideration, 

Reclamation released their final Directives & Standards for the 

Lease of Power Privilege (LOPP) on September 28, 2012. Reclamation, on its own accord, applied a categorical exclusion (CE) under 

NEPA to small conduit hydropower projects as part of its final Directives & Standards for LOPP process. In fact, Reclamation’s CE 

went even further: it can be used to expedite a wide variety of lowimpact hydropower projects built on Reclamation’s water infrastructure. Waiver of NEPA in this bill is unnecessary, since Reclamation has already implemented guidance for a CE. The legislation seeks to solve a NEPA problem that does not exist. 

The Majority argues that NEPA process for the LOPP is both 

time intensive and costly. Yet the witnesses who offered supporting 

testimony provided only vague theoretical estimates for environmental compliance costs without having actually developed or entered into a lease to develop a conduit hydropower project using 

Reclamation’s LOPP process. Furthermore, the Committee has not 

received testimony from any developers who have demonstrated, 

based on experience, that Reclamation’s NEPA process for LOPP— 

with or without the categorical exclusion—has posed a problem or 

an obstacle to development. FERC has used a CE for more than 15 

years, demonstrating that conduit projects can be permitted quickly. Reclamation’s Directives & Standards for the LOPP apply a CE 

that is functionally identical to FERC’s small conduit project CE. 

The Majority argues that the CE does not work because no one 

has used it yet. The only reason that the CE has not yet been tested is that since updating its Directives & Standards in late SepVerDate Mar 15 2010 22:46 Mar 26, 2013 Jkt 029006 PO 00000 Frm 00012 Fmt 6604 Sfmt 6604 E:\HR\OC\HR024.XXX HR024

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tember, Reclamation has not received a formal LOPP application, 

and therefore has not been able to apply a CE. 

Despite these new developments, the legislation that passed out 

of Committee in this Congress still contains the same unnecessary 

NEPA waiver that stopped the legislation from becoming law last 

Congress. There is a misconception that NEPA is solely an environmental issue. NEPA looks at the impacts on ALL uses of the system: irrigation, the environment, private property rights and more. 

NEPA analysis also helps Reclamation to ensure that any new 

project does not interfere with the primary authorized purposes of 

the project. 

Committee Democrats support legislation that promotes small 

conduit hydropower on Reclamation facilities while respecting and 

acknowledging the need for NEPA review, yet H.R. 678 is not such 

legislation. It unnecessarily waives NEPA and therefore disregards 

impacts on all uses of the system. Had the bill in the previous Congress not contained a NEPA waiver, it would have most likely become law. Instead, the Majority committed the Committee’s time 

and resources to moving a nearly identical version of the bill that 

died in the 112th Congress and has slim chance of approval in the 

Senate. In an effort to work with the Majority, the Minority offered 

an amendment that would strike the unnecessary NEPA waiver. 

Unfortunately, our amendment was not adopted. For this reason 

we oppose this legislation. 

EDWARD J. MARKEY. 

GRACE F. NAPOLITANO. 

Æ 


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