II 

118TH CONGRESS 

1ST SESSION S. 2994 

To amend the Internal Revenue Code of 1986 to support upgrades at existing 

hydroelectric dams in order to increase clean energy production, improve 

the resiliency and reliability of the United States electric grid, enhance 

the health of the Nation’s rivers and associated wildlife habitats, and 

for other purposes. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 28 (legislative day, SEPTEMBER 22), 2023 

Ms. CANTWELL (for herself, Ms. MURKOWSKI, Mr. SULLIVAN, Ms. STABENOW, Mr. KING, Mr. TILLIS, and Mrs. GILLIBRAND) introduced the following bill; which was read twice and referred to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to support 

upgrades at existing hydroelectric dams in order to increase clean energy production, improve the resiliency 

and reliability of the United States electric grid, enhance 

the health of the Nation’s rivers and associated wildlife 

habitats, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. SHORT TITLE. 

2 This Act may be cited as the ‘‘Maintaining and En3 hancing Hydroelectricity and River Restoration Act of 

4 2023’’. 

5 SEC. 2. CREDIT FOR MAINTAINING AND ENHANCING HY6 DROELECTRIC FACILITIES. 

7 (a) IN GENERAL.—Subpart E of part IV of sub8 chapter A of chapter 1 of the Internal Revenue Code of 

9 1986 is amended by inserting after section 48E the fol10 lowing new section: 

11 ‘‘SEC. 48F. CREDIT FOR MAINTAINING AND ENHANCING HY12 DROELECTRIC FACILITIES. 

13 ‘‘(a) IN GENERAL.—For purposes of section 46, the 

14 credit for maintaining and enhancing hydroelectric facili15 ties for any taxable year is an amount equal to 30 percent 

16 of the basis of any hydropower improvement property 

17 placed in service during such taxable year. 

18 ‘‘(b) CERTAIN PROGRESS EXPENDITURE RULES

19 MADE APPLICABLE.—Rules similar to the rules of sub20 sections (c)(4) and (d) of section 46 (as in effect on the 

21 day before the date of the enactment of the Revenue Rec22 onciliation Act of 1990) shall apply for purposes of sub23 section (a). 

24 ‘‘(c) HYDROPOWER IMPROVEMENT PROPERTY.—In 

25 this section, the term ‘hydropower improvement property’ 

26 means property— 


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1 ‘‘(1) which— 

2 ‘‘(A) adds or improves fish passage at a 

3 qualified dam, 

4 ‘‘(B) maintains or improves the quality of 

5 the water retained or released by a qualified 

6 dam, 

7 ‘‘(C) promotes downstream sediment trans8 port processes and habitat maintenance with re9 spect to a qualified dam, 

10 ‘‘(D) upgrades, repairs, or reconstructs a 

11 qualified dam to meet Federal dam safety and 

12 security standards, 

13 ‘‘(E) improves the public uses of, and ac14 cess to, public waterways impacted by a quali15 fied dam in a manner consistent with a license 

16 issued by the Federal Energy Regulatory Com17 mission or a settlement agreement related to 

18 such a license, 

19 ‘‘(F) removes an obsolete river obstruction, 

20 or 

21 ‘‘(G) places into service an approved re22 mote dam, and 

23 ‘‘(2) for which, prior to January 1, 2032, the 

24 taxpayer receives written approval with respect to 

25 any property described in paragraph (1) from the 


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1 Federal Energy Regulatory Commission or State or 

2 local officials, as appropriate. 

3 ‘‘(d) OTHER DEFINITIONS.—In this section— 

4 ‘‘(1) APPROVED REMOTE DAM.—The term ‘ap5 proved remote dam’ means— 

6 ‘‘(A) a hydroelectric dam which— 

7 ‘‘(i) exclusively services communities 

8 not interconnected to the Electric Reli9 ability Council of Texas, the Eastern Inter10 connection, or the Western Interconnec11 tion, 

12 ‘‘(ii) was licensed by the Federal En13 ergy Regulatory Commission before De14 cember 31, 2020, 

15 ‘‘(iii) does not contribute to atmos16 phere pollution, and 

17 ‘‘(iv) has a maximum net output of 

18 not greater than 20 megawatts, and 

19 ‘‘(B) any interconnection property associ20 ated with a dam described in subparagraph (A). 

21 ‘‘(2) FISH PASSAGE.—The term ‘fish passage’ 

22 means, with respect to any qualified dam, any new 

23 or upgraded turbine, fishway, or other fish passage 

24 technology which improves fish migration and sur25 vival rates. 


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1 ‘‘(3) INTERCONNECTION PROPERTY.—The term 

2 ‘interconnection property’ means, with respect to 

3 any dam described in paragraph (1)(A), any tangible 

4 property— 

5 ‘‘(A) to enable the delivery of electricity 

6 from such dam to any customer, and 

7 ‘‘(B) which satisfies the requirements 

8 under clauses (ii) and (iii) of section 

9 48(a)(8)(B). 

10 ‘‘(4) OBSOLETE RIVER OBSTRUCTION.—The 

11 term ‘obsolete river obstruction’ means a qualified 

12 nonpowered dam (as defined in section 34(e)(3) of 

13 the Federal Power Act (16 U.S.C. 823e(e)(3))) no 

14 longer serving its intended purpose. 

15 ‘‘(5) QUALIFIED DAM.—The term ‘qualified 

16 dam’ means a hydroelectric dam that is licensed by 

17 the Federal Energy Regulatory Commission or le18 gally operating without such a license before the 

19 date of enactment of this section.’’. 

20 (b) ELECTIVE PAYMENT AND TRANSFER OF CRED21 IT.— 

22 (1) ELECTIVE PAYMENT.—Section 6417 of the 

23 Internal Revenue Code of 1986 is amended— 

24 (A) in subsection (b), by adding at the end 

25 the following: 


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1 ‘‘(13) The credit for maintaining and enhancing 

2 hydroelectric facilities under section 48F.’’, and 

3 (B) in subsection (d)(1)— 

4 (i) in subparagraph (E), by striking 

5 ‘‘(C), or (D)’’ each place it appears and in6 serting ‘‘(C), (D), or (E)’’, 

7 (ii) by redesignating subparagraph 

8 (E) (as amended by clause (i)) as subpara9 graph (F), and 

10 (iii) by inserting after subparagraph 

11 (D) the following: 

12 ‘‘(E) ELECTION WITH RESPECT TO CREDIT

13 FOR MAINTAINING AND ENHANCING HYDRO14 ELECTRIC FACILITIES.—If a taxpayer other 

15 than an entity described in subparagraph (A) 

16 makes an election under this subparagraph with 

17 respect to any taxable year in which such tax18 payer has, after December 31, 2022, placed in 

19 service hydropower improvement property (as 

20 defined in section 48F(c)), such taxpayer shall 

21 be treated as an applicable entity for purposes 

22 of this section for such taxable year, but only 

23 with respect to the credit described in sub24 section (b)(13).’’. 


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1 (2) TRANSFER.—Section 6418(f)(1)(A) of the 

2 Internal Revenue Code of 1986 is amended by add3 ing at the end the following: 

4 ‘‘(xii) The credit for maintaining and 

5 enhancing hydroelectric facilities under 

6 section 48F.’’. 

7 (c) CONFORMING AMENDMENTS.— 

8 (1) Section 46 of the Internal Revenue Code of 

9 1986 is amended— 

10 (A) in paragraph (6), by striking ‘‘and’’ at 

11 the end, 

12 (B) in paragraph (7), by striking the pe13 riod at the end and inserting ‘‘, and’’, and 

14 (C) by adding at the end the following: 

15 ‘‘(8) the credit for maintaining and enhancing 

16 hydroelectric facilities.’’. 

17 (2) Section 49(a)(1)(C) of such Code is amend18 ed— 

19 (A) in clause (vii), by striking ‘‘and’’ at the 

20 end, 

21 (B) in clause (viii), by striking the period 

22 at the end and inserting ‘‘, and’’, and 

23 (C) by adding at the end the following: 

24 ‘‘(ix) the basis of any hydropower im25 provement property under section 48F.’’. 


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1 (3) Section 50 of such Code is amended— 

2 (A) in subsection (a)(2)(E), as amended by 

3 section 13702(b) of Public Law 117–169, by 

4 striking ‘‘or 48E(e)’’ and inserting ‘‘48E(e), or 

5 48F(b)’’, and 

6 (B) in subsection (d)(2)— 

7 (i) in the matter preceding subpara8 graph (A), by inserting ‘‘or any hydro9 power improvement property (as defined in 

10 section 48F(c))’’ after ‘‘any energy storage 

11 technology (as defined in section 

12 48(c)(6))’’, and 

13 (ii) in subparagraph (B), by striking 

14 ‘‘energy storage technology’’ each place it 

15 appears and inserting ‘‘energy storage 

16 technology or hydropower improvement 

17 property’’. 

18 (4) The table of sections for subpart E of part 

19 IV of subchapter A of chapter 1 of such Code is 

20 amended by inserting after the item relating to sec21 tion 48E the following new item: 

‘‘Sec. 48F. Credit for maintaining and enhancing hydroelectric facilities.’’. 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to property placed in service after 

24 December 31, 2022. 

Æ 


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