I 

109TH CONGRESS 

1ST SESSION H. R. 1530 

To encourage the development of hydroelectric projects, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 6, 2005 

Mr. SHADEGG introduced the following bill; which was referred to the 

Committee on Energy and Commerce 

A BILL 

To encourage the development of hydroelectric projects, 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. FINDINGS. 

4 The Congress finds that: 

5 (1) The United States must increase its supply 

6 of energy to ensure a continuing prosperous econ7 omy and high standard of life. 

8 (2) We currently rely heavily on imports of en9 ergy supplies from foreign nations and utilize large 

10 quantities of carbon fuels for electricity generation. 
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1 (3) Hydropower is a domestic energy source 

2 which currently produces 92,000 megawatts of elec3 tricity per year, a figure representing 10 percent of 

4 the generation capacity in the United States. 

5 (4) The Energy Information Agency estimates 

6 that, of the 75,000 dams in the United States, only 

7 2,400 or three percent of these dams currently 

8 produce electricity. 

9 (5) The Energy Information Agency further es10 timates that there are approximately 21,300 

11 megawatts of undeveloped capacity at existing dams. 

12 (6) New technology allows this energy to be uti13 lized with little or no environmental effect by adding 

14 new turbines to existing dams and improving the ef15 ficiency of existing turbines. 

16 (7) Hydropower produces electricity without 

17 producing hazardous waste or air pollutants. 

18 (8) The 92,000 megawatts of electricity cur19 rently generated by hydropower avoid the annual 

20 emission of 4.75 million tons of sulfur dioxide and 

21 2 million tons of nitrous oxide by eliminating the 

22 need to burn 345 million tons of coal. 

23 (9) Hydropower is a renewable energy source 

24 which, because of the natural hydrologic cycle, will 

25 continue to be available in perpetuity. 
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1 SEC. 2. CONSTITUTIONAL AUTHORITY. 

2 The Constitutional authority on which this Act rests 

3 is the power of Congress to make all laws which shall be 

4 necessary and proper as enumerated in article I, section 

5 8 of the United States Constitution. 

6 SEC. 3. HYDROELECTRIC PRODUCTION INCENTIVES. 

7 (a) INCENTIVE PAYMENTS.—For electric energy gen8 erated and sold by a qualified hydroelectric facility during 

9 the incentive period, the Secretary of Energy (referred to 

10 in this section as the ‘‘Secretary’’) shall make, subject to 

11 the availability of appropriations, incentive payments to 

12 the owner or operator of such facility. The amount of such 

13 payment made to any such owner or operator shall be as 

14 determined under subsection (e) of this section. Payments 

15 under this section may only be made upon receipt by the 

16 Secretary of an incentive payment application which estab17 lishes that the applicant is eligible to receive such payment 

18 and which satisfies such other requirements as the Sec19 retary deems necessary. Such application shall be in such 

20 form, and shall be submitted at such time, as the Sec21 retary shall establish. 

22 (b) DEFINITIONS.—For purposes of this section: 

23 (1) QUALIFIED HYDROELECTRIC FACILITY.—

24 The term ‘‘qualified hydroelectric facility’’ means a 

25 turbine or other generating device owned or solely 

26 operated by a non-Federal entity which generates 
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1 hydroelectric energy for sale and which is added to 

2 an existing dam or conduit. 

3 (2) EXISTING DAM OR CONDUIT.—The term 

4 ‘‘existing dam or conduit’’ means any dam or con5 duit the construction of which was completed before 

6 the date of the enactment of this section and which 

7 does not require any construction or enlargement of 

8 impoundment or diversion structures (other than re9 pair or reconstruction) in connection with the instal10 lation of a turbine or other generating device. 

11 (3) CONDUIT.—The term ‘‘conduit’’ has the 

12 same meaning as when used in section 30(a)(2) of 

13 the Federal Power Act. 

14 The terms defined in this subsection shall apply without 

15 regard to the hydroelectric kilowatt capacity of the facility 

16 concerned, without regard to whether the facility uses a 

17 dam owned by a governmental or nongovernmental entity, 

18 and without regard to whether the facility begins oper19 ation on or after the date of the enactment of this section. 

20 (c) ELIGIBILITY WINDOW.—Payments may be made 

21 under this section only for electric energy generated from 

22 a qualified hydroelectric facility which begins operation 

23 during the period of 10 fiscal years beginning with the 

24 first full fiscal year occurring after the date of enactment 

25 of this Act. 
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1 (d) INCENTIVE PERIOD.—A qualified hydroelectric 

2 facility may receive payments under this section for a pe3 riod of 10 fiscal years (referred to in this section as the 

4 ‘‘incentive period’’). Such period shall begin with the fiscal 

5 year in which electric energy generated from the facility 

6 is first eligible for such payments. 

7 (e) AMOUNT OF PAYMENT.— 

8 (1) IN GENERAL.—Payments made by the Sec9 retary under this section to the owner or operator of 

10 a qualified hydroelectric facility shall be based on 

11 the number of kilowatt hours of hydroelectric energy 

12 generated by the facility during the incentive period. 

13 For any such facility, the amount of such payment 

14 shall be 1.5 cents per kilowatt hour (adjusted as 

15 provided in paragraph (2)), subject to the avail16 ability of appropriations under subsection (g), except 

17 that no facility may receive more than $1,000,000 in 

18 one calendar year. 

19 (2) ADJUSTMENTS.—The amount of the pay20 ment made to any person under this section as pro21 vided in paragraph (1) shall be adjusted for inflation 

22 for each fiscal year beginning after calendar year 

23 2005 in the same manner as provided in the provi24 sions of section 29(d)(2)(B) of the Internal Revenue 

25 Code of 1986, except that in applying such provi-
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1 sions the calendar year 2005 shall be substituted for 

2 calendar year 1979. 

3 (f) SUNSET.—No payment may be made under this 

4 section to any qualified hydroelectric facility after the ex5 piration of the period of 20 fiscal years beginning with 

6 the first full fiscal year occurring after the date of enact7 ment of this Act, and no payment may be made under 

8 this section to any such facility after a payment has been 

9 made with respect to such facility for a period of 10 fiscal 

10 years. 

11 (g) AUTHORIZATION OF APPROPRIATIONS.—There 

12 are authorized to be appropriated to the Secretary to carry 

13 out the purposes of this section $50,000,000 for each of 

14 the fiscal years 2006 through 2015. 

15 SEC. 4. HYDROELECTRIC EFFICIENCY IMPROVEMENT. 

16 (a) INCENTIVE PAYMENTS.—The Secretary of En17 ergy shall make incentive payments to the owners or oper18 ators of hydroelectric facilities at existing dams to be used 

19 to make capital improvements in the facilities that are di20 rectly related to improving the efficiency of such facilities 

21 by at least 3 percent. 

22 (b) LIMITATIONS.—Incentive payments under this 

23 section shall not exceed 10 percent of the costs of the cap24 ital improvement concerned and not more than one pay25 ment may be made with respect to improvements at a sin-
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1 gle facility. No payment in excess of $1,000,000 may be 

2 made with respect to improvements at a single facility. 

3 (c) AUTHORIZATION.—There is authorized to be ap4 propriated to carry out this section not more than 

5 $50,000,000 in each fiscal year after the fiscal year 2005. 

6 SEC. 5. SMALL HYDROELECTRIC POWER PROJECTS. 

7 Section 408(a)(6) of the Public Utility Regulatory 

8 Policies Act of 1978 is amended by striking ‘‘April 20, 

9 1977’’ and inserting ‘‘March 4, 2005’’. 

10 SEC. 6. INCREASED HYDROELECTRIC GENERATION AT EX11 ISTING FEDERAL FACILITIES. 

12 (a) IN GENERAL.—The Secretary of Energy, in con13 sultation with the Secretary of the Interior and Secretary 

14 of the Army, shall conduct studies of the cost-effective op15 portunities to increase hydropower generation at existing 

16 federally-owned or operated water regulation, storage, and 

17 conveyance facilities. Such studies shall be completed with18 in two years after the date of enactment of this Act and 

19 transmitted to the Committee on Commerce of the House 

20 of Representatives and the Committee on Energy and 

21 Natural Resources of the Senate. An individual study shall 

22 be prepared for each of the Nation’s principal river basins. 

23 Each such study shall identify and describe with speci24 ficity the following matters: 
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1 (1) Opportunities to improve the efficiency of 

2 hydropower generation at such facilities through, but 

3 not limited to, mechanical, structural, or operational 

4 changes. 

5 (2) Opportunities to improve the efficiency of 

6 the use of water supplied or regulated by Federal 

7 projects where such improvement could, in the ab8 sence of legal or administrative constraints, make 

9 additional water supplies available for hydropower 

10 generation or reduce project energy use. 

11 (3) Opportunities to create additional hydro12 power generating capacity at existing facilities 

13 through, but not limited to, the construction of addi14 tional generating facilities, the uprating of genera15 tors and turbines, and the construction of pumped 

16 storage facilities. 

17 (4) Preliminary assessment of the costs and the 

18 economic and environmental consequences of such 

19 measures. 

20 (b) PREVIOUS STUDIES.—If studies of the type re21 quired by subsection (a) have been prepared by any agency 

22 of the United States and published within the five years 

23 prior to the date of enactment of this Act, the Secretary 

24 of Energy may choose not to perform new studies and in-
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1 corporate the information in such studies into the studies 

2 required by subsection (a). 

3 (c) AUTHORIZATION.—There is authorized to be ap4 propriated such sums as may be necessary to carry out 

5 the purposes of this section. 

6 SEC. 7. RENEWABLE ENERGY PRODUCTION INCENTIVES 

7 PROGRAM. 

8 Section 1212 of the Energy Policy Act of 1992 is 

9 amended in subsection (b) by inserting after ‘‘and which’’ 

10 the following ‘‘is a small hydroelectric power project (as 

11 defined in section 408(a)(1) of the Public Utility Regu12 latory Policies Act of 1978) or which’’. 

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