[Senate Report 108-27]
[From the U.S. Government Publishing Office]
Calendar No. 42
108th Congress
SENATE
1st Session Report 108-27
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HYDROELECTRIC PROJECT IN THE STATE OF ILLINOIS
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March 19, 2003.--Ordered to be printed
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Mr. Domenici, from the Committee on Energy and Natural Resources,
submitted the following
R E P O R T
[To accompany H.R. 397]
The Committee on Energy and Natural Resources, to which was
referred the Act (H.R. 397) to reinstate and extend the
deadline for commencement of construction of a hydroelectric
project in the State of Illinois, having considered the same,
reports favorably thereon without amendment and recommends that
the Act do pass.
PURPOSE OF THE MEASURE
The purpose of H.R. 397 is to reinstate the license for
construction, operation, and maintenance and to extend the
deadline for commencement of construction of a hydroelectric
project in the State of Illinois.
BACKGROUND AND NEED
Section 13 of the Federal Power Act requires that
construction commence within 2 years after a project is
licensed. The Federal Regulatory Commission (FERC is authorized
under the Federal Power Act to extend this deadline once, for a
maximum of two additional years, upon a finding that such
extensions is ``not incompatible with the public interest.''
Consequently, a license is subject to termination if a licensee
fails to begin construction within 4 years after the license is
issued.
H.R. 397 would reinstate an expired license for Project No.
11214, a four-megawatt hydroelectric project on the U.S. Army
Corps of Engineers' Carlyle Dam, located on the Kaskaskia
River, as of the effective date of the surrender of the
license. In 1997, Southwestern Electric Cooperative, Inc.
(Southwestern) was issued the original license by FERC.
However, Southwestern did not begin construction of the project
and surrendered the license to FERC in 2000. According to House
Report 108-6, the city of Carlyle, Illinois, is interested in
developing the hydroelectric project and has reached agreement
with Southwestern whereby once the license is reinstated,
Southwestern has agreed to transfer the license, designs and
development of the project to the city. FERC has stated that it
is not aware of any other party that is interested in
developing this project site.
LEGISLATIVE HISTORY
H.R. 397 was introduced by Representative Shimkus on
January 28, 2003, and reported by the House Energy and Commerce
Committee on February 4, 2003. The measure passed the House by
voice vote on February 11, 2003, and was referred to the Senate
Committee on Energy and Natural Resources. The Subcommittee on
Water and Power conducted a hearing on the measure on March 6,
2003. At the business meeting on March 12, 2003, the Committee
on Energy and Natural Resources ordered H.R. 397 favorably
reported.
COMMITTEE RECOMMENDATION
The Committee on Energy and Natural Resources, in open
business session on March 12, 2003, by a voice vote of a quorum
present, recommends that the Senate pass H.R. 397.
SECTION-BY-SECTION ANALYSIS
Section 1 authorizes FERC, for Project No. 11214, upon the
request of the licensee, and in accordance with the good faith,
due diligence, and public interest requirements of section 13
of the Federal Power Act and FERC's procedures under such
section: (1) to reinstate the license for construction of the
project as of the effective date of surrender of the license;
and (2) to extend the deadline to commence construction of the
project for up to three additional two-year periods beyond the
date that is four years after the date of the issuance of the
license.
COST AND BUDGETARY CONSIDERATIONS
The following estimate of the cost of this measure has been
provided by the Congressional Budget Office:
U.S. Congress,
Congressional Budget Office,
Washington, DC, March 14, 2003.
Hon. Pete V. Domenici,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 397, an act to
reinstate and extend the deadline for commencement of
construction of a hydroelectric project in the state of
Illinois.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Lisa Cash
Driskill.
Sincerely,
Douglas Holtz-Eakin,
Director.
Enclosure.
H.R. 397--An act to reinstate and extend the deadline for commencement
of construction of a hydroelectric project in the state of
Illinois
CBO estimates that implementing H.R. 397 would have no net
effect on the federal budget. The legislation 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.
H.R. 397 would authorize the Federal Energy Regulatory
Commission (FERC) to reinstate the license and extend the
deadline for construction of a hydroelectric project (number
11214) in Carlyle, Illinois. Those provisions could have a
minor impact on FERC's workload. Because FERC recovers 100
percent of its costs through user fees, any change in its
administrative costs would be offset by an equal change in the
fees that the commission charges. Hence, the legislation's
provisions would have no net budgetary impact.
Because FERC's administrative costs are limited in annual
appropriations, the act would not affect direct spending or
revenues.
On February 3, 2003, CBO transmitted a cost estimate for
H.R. 397, as ordered reported on January 29, 2003 by the House
Committee on Energy and Commerce. The two versions of the
legislation are identical, as are our cost estimates.
The CBO staff contact for this estimate is Lisa Cash
Driskill. This estimate was approved by Peter H. Fontaine,
Deputy Assistant Director for Budget Analysis.
REGULATORY IMPACT EVALUATION
In compliance with paragraph 11(b) of rule XXVI of the
Standing Rules of the Senate, the Committee makes the following
evaluation of the regulatory impact which would be incurred by
carrying out H.R. 397. The bill is not a regulatory measure in
the sense of imposing Government-established standards or
significant economic responsibilities on private individuals
and businesses.
No personal information would be collected in administering
the program. Therefore, there would be no impact on personal
privacy.
Little, if any, additional paperwork would result from the
enactment of H.R. 397.
EXECUTIVE COMMUNICATIONS
The pertinent legislative report received by the Committee
from FERC setting forth Executive agency recommendations
relating to H.R. 397 is set forth below:
Federal Energy Regulatory Commission,
Washington, DC, March 13, 2003.
Hon. Pete V. Domenici,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: Thank you for your letter of March 10,
2003 asking for my views on H.R. 397, a House-passed bill to
reinstate the surrendered license and to extend the
commencement of construction deadline applicable to a
hydroelectric project licensed by the Federal Energy Regulatory
Commission in the State of Illinois. My comments also apply to
an identical Senate bill, S. 220.
Section 13 of the Federal Power Act requires that
construction of a licensed project be commenced within two
years of issuance of the license. Section 13 authorizes the
Commission to extend this deadline once, for a maximum
additional two years. If project construction has not commenced
by this deadline, the Commission is required to terminate the
license. Section 13 also authorizes the Commission to extend
the deadline for completion of construction when not
incompatible with the public interest.
The Project
On June 26, 1997, the Commission issued a license to
Southwestern Electric Cooperative, Inc. (Southwestern) to
construct, operate, and maintain the 4-megawatt Carlyle
Hydroelectric Project No. 11214, to be located at the U.S. Army
Corps of Engineers' Carlyle Dam on the Kaskaskia River in
Clinton County, Illinois. Construction of the project entails
installing an intake structure, five intake conduits, a
powerhouse with five 800-kilowatt generating units, a
transmission line, and appurtenances. The deadline for the
commencement of project construction was June 26, 1999.
By filing of March 3, 1999, Southwestern advised the
Commission that it would be applying to surrender the project
license. On March 27, 2000, Southwestern filed an application
to surrender the license, stating that the project was no
longer economically feasible. No project construction has
commenced. The Commission accepted the surrender, effective
June 24, 2000.
H.R. 397 and S. 220
Both bills would authorize the Commission, upon request of
the licensee, after reasonable notice and in accordance with
the requirements of Section 13 of the Federal Power Act, to
reinstate the surrendered license for Project No. 11214 and to
extend the deadline for commencement of project construction
for three consecutive 2-year periods beyond the date that is
four years after the issuance date of the license.
As a general matter, enactment of bills authorizing or
requiring commencement-of-construction extensions for
individual projects delays the development of an important
energy resource and therefore has not been recommended. In
cases where project-specific extensions are authorized by the
Congress, it has been the policy of prior Commission chairmen
that such extensions not go beyond ten years from the date the
project was licensed. It a licensee cannot meet a ten-year
deadline, then as a general rule the license should be
terminated, making the site once again available for such uses
as current circumstances may warrant, based on up-to-date
information on economic and environmental considerations. I
have no reason to depart from this extension policy.
H.R. 397 and S. 220 would provide for extensions of the
deadline for commencement of construction that would not exceed
ten years from the date the license was issued. Since this time
period is within the ten-year deadline, I have no objection to
the bills' enactment.
I hope that this information is helpful to you. If I can be
of further assistance to you in this or any other Commission
matter, please let me know.
Best regards,
Pat Wood III,
Chairman.
CHANGES IN EXISTING LAW
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee notes that no
changes in existing law are made by H.R. 397, as ordered
reported.