[Senate Report 115-105]
[From the U.S. Government Publishing Office]
Calendar No. 141
115th Congress} { Report
SENATE
1st Session } { 115-105
======================================================================
TO AUTHORIZE THE EXPANSION OF AN EXISTING HYDROELECTRIC PROJECT
_______
June 13, 2017.--Ordered to be printed
_______
Ms. Murkowski, from the Committee on Energy and Natural
Resources, submitted the following
R E P O R T
[To accompany S. 214]
[Including cost estimate of the Congressional Budget Office]
The Committee on Energy and Natural Resources, to which was
referred the bill (S. 214) to authorize the expansion of an
existing hydroelectric project, having considered the same,
reports favorably thereon without amendment and recommends that
the bill do pass.
PURPOSE
The purpose of S. 214 is to authorize the expansion of the
existing Terror Lake hydroelectric project in Alaska.
BACKGROUND AND NEED
Approval to construct the Terror Lake Hydroelectric Project
in Alaska was granted by the Federal Energy Regulatory
Commission in 1981. The 36-megawatt project has been in
operation since the 1980s and the Kodiak Electric Association
(KEA), which serves the city of Kodiak, including the nation's
largest U.S. Coast Guard Base and one of the country's largest
commercial fishing ports, now obtains 99.7 percent of its
electric power from the hydroelectric project and another
nearby wind farm.
In order to avoid burning approximately two million gallons
of diesel fuel to produce additional power, KEA seeks to
increase the amount of hydropower generated at the facility by
expanding operations through the Upper Hidden Basin Diversion
Expansion. The proposed expansion involves diverting five small
streams located on Alaska State lands in the adjacent Upper
Hidden Basin and allowing that water to flow into Terror Lake
through an underground tunnel. The project would not involve
adding turbines or equipment to the existing Terror Lake
powerhouse. The expansion would increase the total production
of electricity from the existing project by an additional 30
gigawatt-hours annually, representing a 25 percent increase in
power production. This will allow KEA to enhance its wind-
hydropower integration system and its micro-grid energy storage
technology.
The existing Terror Lake Project is located within the
Kodiak National Wildlife Refuge pursuant to a Special Use
Permit granted by the U.S. Fish and Wildlife Service in 1981.
S. 214 authorizes the construction, operation, and maintenance
of the underground tunnel within the Kodiak National Wildlife
Refuge. Insofar as the Upper Hidden Basin Diversion Expansion
is an expansion of the Terror Lake Hydroelectric Project, the
Committee expects the terms and special conditions of the
Special Use Permit KD-81-0040 issued on July 21, 1981, as
amended, to remain in effect and to apply to the expansion.
LEGISLATIVE HISTORY
Senators Murkowski and Sullivan introduced S. 214 on
January 24, 2017.
Representative Don Young introduced companion legislation,
H.R. 220, in the House of Representatives on January 3, 2017.
In the 114th Congress, similar legislation, S. 1583, was
introduced by Senator Murkowski on June 16, 2015. The Committee
on Energy and Natural Resources held a hearing on October 8,
2015, to consider the bill and ordered S. 1583 favorably
reported, as amended, at its business meeting on November 19,
2015 (S. Rept. 114-185). Representative Don Young introduced
companion legislation, H.R. 4193, in the House of
Representatives on December 8, 2015.
The measure was included in Amendment No. 3234, which the
Senate agreed to on April 19, 2016, as an amendment to S. 2012,
the Energy Policy Modernization Act of 2016, which the Senate
passed, as amended, on April 20, 2016.
The Committee on Energy and Natural Resources met in open
business session on March 30, 2017, and ordered S. 214
favorably reported.
COMMITTEE RECOMMENDATION
The Senate Committee on Energy and Natural Resources, in
open business session on March 30, 2017, by a majority voice
vote of a quorum present, recommends that the Senate pass S.
214.
SECTION-BY-SECTION ANALYSIS
Section 1. Terror Lake Hydroelectric Project Upper Hidden Basin
Diversion authorization
Section 1(a) defines key terms.
Subsection (b) authorizes the licensee to occupy up to 20
acres of Federal land to construct, operate, and maintain the
Upper Hidden Basin Diversion Expansion without further
authorization of the Secretary. It also clarifies that
authorization of the expansion is not subject to the Alaska
National Interest Lands Conservation Act.
Subsection (c) clarifies that the expansion of the Terror
Lake Hydroelectric Project remains subject to the Federal
Energy Regulatory Commission's hydropower licensing proceedings
pursuant to the Federal Power Act, including section 4(e) of
that Act, as well as the National Environmental Policy Act of
1969.
COST AND BUDGETARY CONSIDERATIONS
The following estimate of costs of this measure has been
provided by the Congressional Budget Office:
S. 214 would specify that the licensee of the Terror Lake
hydroelectric project (number 2743), located within the Kodiak
National Wildlife Refuge in Alaska, can expand that project to
occupy not more than 20 acres of additional federal land. Under
the bill, the proposed expansion would require no further
approval by the Secretary of the Interior.
CBO estimates that enacting S. 214 would not significantly
affect the federal budget. The proposed expansion could have a
minor effect on spending by the Federal Energy Regulatory
Commission (FERC), which regulates the Terror Lake
hydroelectric project. Because FERC recovers 100 percent of its
costs through user fees, however, any change in that agency's
costs (which are controlled through annual appropriation acts)
would be offset by an equal change in fees that the commission
charges, resulting in no net change in federal spending.
According to the Department of the Interior, the federal
lands that would be affected by the proposed expansion
currently generate no significant receipts from programs to
develop natural resources and are not expected to do so in the
future. As a result, CBO expects that the proposed expansion
would not affect offsetting receipts (which are treated as
reductions in direct spending). Because S. 214 would not affect
direct spending or revenues, pay-as-you-go procedures do not
apply.
CBO estimates that enacting S. 214 would not increase net
direct spending or on-budget deficits in any of the four
consecutive 10-year periods beginning in 2028.
S. 214 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.
The CBO staff contact for this estimate is Megan Carroll.
The estimate was approved by H. Samuel Papenfuss, 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 in
carrying out S. 214. 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 S. 214, as ordered reported.
CONGRESSIONALLY DIRECTED SPENDING
S. 214, as ordered reported, does not contain any
congressionally directed spending items, limited tax benefits,
or limited tariff benefits as defined in rule XLIV of the
Standing Rules of the Senate.
EXECUTIVE COMMUNICATIONS
Because S. 214 is similar to legislation considered by the
Committee in the 114th Congress, the Committee did not request
Executive Agency views. The relevant portion of the written
testimony provided by the Chairman of the Federal Energy
Regulatory Commission for the hearing before the Energy and
Natural Resources Committee on October 8, 2015, follows:
Federal Energy
Regulatory Commission,
Washington, DC.
Re S. 1583, S. 2083, and S. 2046.
Hon. Lisa Murkowski,
Chairman, Committee on Energy and Natural Resources,
Washington, DC.
Dear Chairman Murkowski: This letter is in response to a
request by the Senate Committee on Energy and Natural Resources
for my views on S. 1583, a bill to authorize the expansion of
the existing Terror Lake Hydroelectric Project, located at
Terror Lake, on Kodiak Island, Alaska; S. 2083, a bill to
extend the deadline for the commencement of construction of the
W. Kerr Scott Hydroelectric Project in North Carolina; and S.
2046, a bill to authorize the Federal Energy Regulatory
Commission (Commission) to issue an order continuing a stay of
a hydroelectric license for the Mahoney Lake Project in the
State of Alaska, and for other purposes.
S. 1583
On October 5, 1981, the Commission issued an original
license authorizing Kodiak Electric Association, Inc. to
construct and operate the Terror Lake Project No. 2743, to be
located on the Terror and Kizhuyak Rivers, 25 miles southwest
of the City of Kodiak, Alaska. The project was originally
authorized to have a capacity of 20 megawatts (MW), but has
since expanded to 36 MW.
S. 1583 would expand the special-use permit issued for the
project by the Secretary of the Interior, in order to allow the
construction, operation, and maintenance of a tunnel and
associated facilities and activities for the project-related
Upper Hidden Basin Diversion. The diversion would provide
additional flows to the project, thus allowing increased
generation.
The Commission has no jurisdiction over the special-use
permit, so I have no comment on S. 1583. However, I am aware
that Kodiak Electric Association is in the process of preparing
an amendment application, scheduled to be filed with the
Commission in 2017, seeking authorization to construct the
facilities needed for the Upper Hidden Basin Diversion. It is
my understanding that the licensee has prepared a draft
amendment application and held joint agency and public meetings
to discuss it, and has begun consultation under the Endangered
Species Act, Magnuson-Stevens Fishery Conservation and
Management Act, and the National Historic Preservation Act. I
also understand that, to the extent that the amendment will
result in the project occupying additional lands within a
reservation of the United States, S. 1583 will preserve the
right of the Secretary of the department under whose
supervision those lands fall to impose conditions, pursuant to
section 4(e) of the Federal Power Act, that the Secretary deems
necessary for the adequate protection and utilization of the
reservation. Should the amendment application be filed with the
Commission, staff will review it as expeditiously as possible.
If I can be of further assistance to you on this or any
other Commission matter, please let me know.
Sincerely,
Norman C. Bay,
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 the bill as ordered
reported.
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