Contact Your U.S. Senators and Urge them to Protect Our
Nation's Hydropower Resources!

Support Section 511 of S.14 - the Hydropower Licensing Reform
Provision of the Senate Energy Bill

07/29/2003

Hydropower is vital to America's future.
Hydropower is a clean, dependable energy source that plays an important role in our nation's energy strategy. Not only is hydropower our largest source of renewable energy - providing more than 10 percent of the country's electric generating capacity and benefiting tens of millions of customers in more than 40 states nationwide - it is emissions-free, thereby enhancing our ability to reduce greenhouse gases and improve air quality. Hydropower provides electricity when needed during the day more quickly than most other sources, helping to ensure the stability and reliability of our electric system. And it contributes to a diverse fuel supply, allowing the U.S. to obtain adequate supplies of affordable electricity from a variety of energy sources, including domestic water power.

In addition to generating renewable, emission-free, reliable, domestic electricity, hydropower projects provide multiple benefits to fish, plants, and wildlife. These projects support a multitude of outdoor recreation activities, including camping, hiking, fishing, boating, swimming, and more. In fact, the nation's hydropower industry provides more recreation opportunities than our national park system. Hydropower's benefits also include flood control, irrigation and community drinking water.

The hydropower industry is proud of its stewardship of our nation's hydro-producing rivers and the role hydropower plays in serving the nation's energy needs and electricity consumers. Hydropower project owners have devoted significant time and substantial financial resources to ensure that these projects provide a robust array of public resource and environmental benefits.

Unreasonable mandatory license conditions place hydropower at risk.
Under the Federal Power Act, the Federal Energy Regulatory Commission (FERC) issues and renews licenses for non-federal hydropower projects. Before approving a license, FERC considers more than 40 federal laws and engages in one of the most extensive public processes used for approving any facilities in our country. In addition to power and development purposes, FERC gives equal consideration to energy conservation, fish and wildlife resources, recreation, and other environmental factors. FERC also considers other public uses of the water, such as navigation, irrigation, and drinking water supply.

One of the most critical factors affecting FERC's ability to manage re-licensing is the "mandatory conditioning" authority held by multiple other federal agencies (namely the U.S. Departments of Agriculture, Commerce, and Interior). These agencies can directly constrain the use of water flows for generating electricity, and they can impose expensive operating conditions on hydropower projects, without considering the effects on project economics, energy supply, recreation, water supply, and other public benefits. FERC cannot modify or reject these mandatory conditions even if they are not well justified, are not the most cost-effective solutions, conflict with other public benefits or resource needs, erode important project attributes, or make a project uneconomic to operate.

Mandatory conditioning authority is too often used to squeeze maximum concessions out of hydropower project operators - at the expense of electricity consumers and other hydropower beneficiaries - without regard to what is truly needed to protect the environment.

Congress has an opportunity this year to reform the licensing process in a manner that would fully preserve mandatory conditioning authority yet ensure that federal resource agencies use their enormous and far-reaching authority more responsibly. This is an urgent matter, as over one-half of all hydropower capacity regulated by FERC (more than 30,000 megawatts at 296 projects in 36 states) will be re-licensed in the next 15 years. Many of these projects either have begun or soon will begin the re-licensing process because the process actually starts at least five years prior to the expiration of an existing license. The time to act is now.

The Senate Energy Bill makes modest but important changes to address this issue.
Section 511 of the Senate Energy Bill will add some much-needed balance, certainty, and resource agency accountability to the licensing process. At the same time, it fully preserves existing environmental protection standards and resource agency mandatory conditioning authority. Section 511 will help make the licensing process work better for all electricity consumers. It also will help preserve the many public benefits supported by these projects and ensure the continued availability of our nation's leading clean, renewable energy resource for future generations.

Click here to review the Section 511 of S. 14

Section 511 of the Senate Energy Bill WILL:

• Preserve federal resource agency conditioning authority, yet ensure that the agencies consider the impacts of their mandatory conditions before imposing them.
• Provide an opportunity for a timely hearing on the record regarding disputed issues of material fact related to the conditions.
• Allow license applicants to propose alternative mandatory conditions, which the federal agencies would accept if the conditions meet applicable environmental and resource protection requirements at lower cost or with fewer energy impacts.
• Provide for non-binding dispute resolution should FERC find that a mandatory condition is inconsistent with the Federal Power Act or other applicable law.

Section 511 of the Senate Energy Bill WILL NOT:

• Remove any authorities of federal resource agencies to issue conditions on hydropower projects.
• Change the existing environmental threshold required by law for hydropower licensing.
• Exclude or in any way diminish public participation in the licensing process, including participation by Indian tribes.
• Alter or affect States' rights in the licensing process.
• Reduce the hydropower industry's continued commitment and responsibility to good environmental stewardship.

The Senate Should support Section 511 of S. 14 without changes.
The Hydropower licensing provision of S. 14 is a good-government measure that encourages alternative approaches to meeting important environmental resource goals while recognizing the many other societal benefits of the nation's hydropower projects. Any efforts to strike or weaken the hydropower re-licensing improvement provisions in S. 14 should be rejected.

Grange policy on hydro electric power:

• The National Grange urges the repeal of laws and regulations that have blocked or discouraged United States' energy production by private enterprise. We support a national energy policy that will encourage the development of all forms of domestic energy, traditional and alternative, including solar, wind, geothermal, ethanol, surf, shale, tar sands, hydroelectric, agricultural products, wastes, peat, wood, coal, coal gasification, oil, natural gas, nuclear, hydrogen, biodiesel and methanol in an environmentally sound manner without exploiting our parks and wildernesses in order to reduce our dependence on foreign oil.
• The National Grange supports the preference concept of the Federal Power Act being granted to public power utilities in the licensing and re-licensing of federal hydroelectric facilities. We further support granting co-preference in the licensing and re-licensing of federal hydroelectric facilities to rural electric cooperatives. We oppose any legislative weakening of the preference concept.
• The National Grange recommends that federal, state, and local governments work closely with each other and local landowners in the development and construction of watershed projects, dams, and reservoirs for multiple uses, such as flood control, storing and releasing surplus flood water, replenishing underground water, hydroelectric power generation, irrigation, industrial and municipal use, and recreation. We are opposed to moratoriums on the construction of projects that have been authorized. We urge both Congress and the President to make the necessary funds available in order to complete all planned and feasible federal water development projects and provide cost share assistance for the rehabilitation of dams and other flood control structures that were previously constructed with federal assistance. The National Grange supports efforts to provide state and federal funds to pay the recreational share of impoundment facilities on small water development projects.

Action Plan --- Contact Your U.S. Senators and Urge them to Support the Hydropower Licensing Reform Provision of the Senate Energy Bill!

Contact information for U.S. Senators

If you have any questions or comments please contact Legislative Research Analyst Chil-Sook Hwang by fax: 202-347-1091 or by phone: 1-888-4GRANGE, ext 109. Thank you for your grassroots participation in the National Grange Legislative program.

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