II 

118TH CONGRESS 

2D SESSION S. 3581 

To direct the Administrator of the Western Area Power Administration to 

reduce rates for firm electric service customers due to shortfalls in 

generation from certain Bureau of Reclamation hydroelectric facilities, 

and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JANUARY 11, 2024 

Mr. KELLY (for himself and Ms. SINEMA) introduced the following bill; which 

was read twice and referred to the Committee on Energy and Natural 

Resources 

A BILL 

To direct the Administrator of the Western Area Power 

Administration to reduce rates for firm electric service 

customers due to shortfalls in generation from certain 

Bureau of Reclamation hydroelectric facilities, 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, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Hydropower Delivery 

5 Rate-reduction Offset Act of 2024’’ or the ‘‘HYDRO Act 

6 of 2024’’. 

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1 SEC. 2. FINDINGS. 

2 Congress finds that— 

3 (1) the sale of hydropower from Federal facili4 ties at cost-based rates to project use and firm elec5 tric service customers has financed Federal projects 

6 and programs that are not strictly necessary for, or 

7 related to, the production of hydropower; 

8 (2) maintaining a mutually beneficial contrac9 tual relationship with project use and firm electric 

10 service customers is beneficial for the integrity of 

11 the Federal hydropower program; 

12 (3) long-term drought conditions in the Western 

13 United States have produced untenable conditions 

14 for the delivery of hydropower; and 

15 (4) the conditions referred to in paragraph (3) 

16 make the recovery of costs unrelated to the produc17 tion of Federal hydropower inconsistent with sound 

18 business principles. 

19 SEC. 3. SENSE OF CONGRESS RELATING TO THE ADMINIS20 TRATOR OF THE WESTERN AREA POWER AD21 MINISTRATION. 

22 It is the sense of Congress that— 

23 (1) the Administrator of the Western Area 

24 Power Administration (referred to in this Act as the 

25 ‘‘Administrator’’) has the discretion to exclude 

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•S 3581 IS

1 nonpower-related costs from power rate repayment 

2 studies; and 

3 (2) the Administrator should exercise the dis4 cretion of the Administrator— 

5 (A) to reduce unnecessary expenditures 

6 during periods of extreme drought; and 

7 (B) to exclude costs from hydropower rates 

8 that are inconsistent with an equitable alloca9 tion or assignment of nonpower-related costs to 

10 project use and firm electric service rates. 

11 SEC. 4. HYDROPOWER DROUGHT MITIGATION. 

12 (a) NOTIFICATION OF PREDICTED AVAILABLE

13 POWER.— 

14 (1) IN GENERAL.—Not later than 30 days after 

15 the date of enactment of this Act, and each January 

16 1 thereafter, the Administrator shall notify project 

17 use and firm electric service customers of each of the 

18 Bureau of Reclamation projects described in para19 graph (2) of the quantity of energy predicted to be 

20 available for delivery from the applicable Bureau of 

21 Reclamation project during the 1-year period begin22 ning on the date of the notification, based on the 

23 most recent August 24-month study of the Bureau 

24 of Reclamation. 

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1 (2) DESCRIPTION OF PROJECTS.—The Bureau 

2 of Reclamation projects referred to in paragraph (1) 

3 are the following: 

4 (A) The Colorado River Storage Project, 

5 the Collbran Project, and the Rio Grande 

6 Project (collectively referred to in this Act as 

7 the ‘‘Salt Lake City Area Integrated Projects’’). 

8 (B) The Boulder Canyon Project. 

9 (C) The Parker-Davis Project. 

10 (b) CONDITIONS WARRANTING RATE REDUCTION.— 

11 (1) SALT LAKE CITY AREA INTEGRATED

12 PROJECTS.—If a notification under subsection (a)(1) 

13 indicates that the annual quantity of energy pro14 duced by the Salt Lake City Area Integrated 

15 Projects is predicted to be less than 4,900,000 

16 MWh, the Administrator shall reduce rates for each 

17 project use and firm electric service customer of the 

18 Salt Lake City Area Integrated Projects in each 

19 monthly invoice for firm electric service until such 

20 time as the expected annual energy production re21 turns to levels equal to or greater than 4,900,000 

22 MWh. 

23 (2) BOULDER CANYON PROJECT.—If a notifica24 tion under subsection (a)(1) indicates that the an25 nual quantity of energy produced by the Boulder 

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1 Canyon Project is predicted to be less than 

2 3,600,000 MWh, the Administrator shall reduce 

3 rates for each project use and firm electric service 

4 customer of the Boulder Canyon Project in each 

5 monthly invoice for firm electric service until such 

6 time as the expected annual energy production re7 turns to levels equal to or greater than 3,600,000 

8 MWh. 

9 (3) PARKER-DAVIS PROJECT.—If a notification 

10 under subsection (a)(1) indicates that the annual 

11 quantity of energy produced by the Parker-Davis 

12 Project is expected to be less than 1,400,000 MWh, 

13 the Administrator shall reduce rates for each project 

14 use and firm electric service customer of the Parker15 Davis Project in each monthly invoice for project use 

16 and firm electric service until such time as the ex17 pected annual energy production returns to levels 

18 equal to or greater than 1,400,000 MWh. 

19 (c) RATE REDUCTION.— 

20 (1) IN GENERAL.—For purposes of calculating 

21 a rate reduction required under subsection (b), the 

22 Administrator shall reduce rates for each project use 

23 and firm electric service customer in accordance with 

24 the principles described in sections 2 and 3. 

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1 (2) LIMITATION ON RATE REDUCTION.—The 

2 Administrator may not reduce rates as required 

3 under subsection (b) by an aggregate amount great4 er than any unobligated balances associated with the 

5 projects described in subsection (a)(2). 

6 (d) TERMINATION OF EFFECTIVENESS.—Subsections 

7 (a) through (c) shall cease to be effective on December 

8 31, 2031. 

9 SEC. 5. EFFECT. 

10 (a) COST RECOVERY.—Nothing in this Act preempts 

11 the obligations of the Administrator to set rates to recover 

12 costs as may be required by law. 

13 (b) FUNDING.— 

14 (1) IN GENERAL.—Nothing in this Act author15 izes additional appropriations for the Western Area 

16 Power Administration. 

17 (2) USE OF EXISTING FUNDS.—The Adminis18 trator shall use any funds authorized and appro19 priated to the Western Area Power Administration 

20 on an annual basis to carry out the duties of the Ad21 ministrator under this Act. 

22 (c) NO RETROACTIVE RATES.—Notwithstanding any 

23 other provision of law, the Administrator shall not recover 

24 any rate reduction provided pursuant to this section in fu25 ture rates. 

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1 (d) EFFECT ON WATER RIGHTS.—Nothing in this 

2 Act— 

3 (1) alters or affects any water rights held by— 

4 (A) the United States; 

5 (B) any Indian Tribe, band, or community; 

6 (C) any State or political subdivision of a 

7 State; or 

8 (D) any person; 

9 (2) authorizes the Secretary of the Interior to 

10 change or otherwise modify operations at Bureau of 

11 Reclamation facilities in the Colorado River Basin; 

12 or 

13 (3) authorizes a change in the terms of the 

14 agreement entitled the ‘‘Second Memorandum of 

15 Agreement Concerning the Upper Colorado River 

16 Basin Fund’’ and dated June 10, 2020. 

Æ