[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]


 
   HYDROPOWER: PROVIDING 75% OF AMERICA'S CURRENT RENEWABLE ENERGY. 
 EXPLORING ITS ROLE AS A CONTINUED SOURCE OF CLEAN, RENEWABLE ENERGY 
                            FOR THE FUTURE. 

=======================================================================

                           OVERSIGHT HEARING

                               before the

                    SUBCOMMITTEE ON WATER AND POWER

                                 of the

                     COMMITTEE ON NATURAL RESOURCES
                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             SECOND SESSION

                               __________

                        Thursday, June 12, 2008

                               __________

                           Serial No. 110-76

                               __________

       Printed for the use of the Committee on Natural Resources



  Available via the World Wide Web: http://www.gpoaccess.gov/congress/
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                     COMMITTEE ON NATURAL RESOURCES



              NICK J. RAHALL, II, West Virginia, Chairman
              DON YOUNG, Alaska, Ranking Republican Member

Dale E. Kildee, Michigan             Jim Saxton, New Jersey
Eni F.H. Faleomavaega, American      Elton Gallegly, California
    Samoa                            John J. Duncan, Jr., Tennessee
Neil Abercrombie, Hawaii             Wayne T. Gilchrest, Maryland
Solomon P. Ortiz, Texas              Chris Cannon, Utah
Frank Pallone, Jr., New Jersey       Thomas G. Tancredo, Colorado
Donna M. Christensen, Virgin         Jeff Flake, Arizona
    Islands                          Stevan Pearce, New Mexico
Grace F. Napolitano, California      Henry E. Brown, Jr., South 
Rush D. Holt, New Jersey                 Carolina
Raul M. Grijalva, Arizona            Luis G. Fortuno, Puerto Rico
Madeleine Z. Bordallo, Guam          Cathy McMorris Rodgers, Washington
Jim Costa, California                Louie Gohmert, Texas
Dan Boren, Oklahoma                  Tom Cole, Oklahoma
John P. Sarbanes, Maryland           Rob Bishop, Utah
George Miller, California            Bill Shuster, Pennsylvania
Edward J. Markey, Massachusetts      Bill Sali, Idaho
Peter A. DeFazio, Oregon             Doug Lamborn, Colorado
Maurice D. Hinchey, New York         Mary Fallin, Oklahoma
Patrick J. Kennedy, Rhode Island     Adrian Smith, Nebraska
Ron Kind, Wisconsin                  Robert J. Wittman, Virginia
Lois Capps, California               Steve Scalise, Louisiana
Jay Inslee, Washington
Mark Udall, Colorado
Joe Baca, California
Hilda L. Solis, California
Stephanie Herseth Sandlin, South 
    Dakota
Heath Shuler, North Carolina

                     James H. Zoia, Chief of Staff
                       Rick Healy, Chief Counsel
            Christopher N. Fluhr, Republican Staff Director
                 Lisa Pittman, Republican Chief Counsel
                                 ------                                

                    SUBCOMMITTEE ON WATER AND POWER

              GRACE F. NAPOLITANO, California, Chairwoman
     CATHY McMORRIS RODGERS, Washington, Ranking Republican Member

Jim Costa, California                Ken Calvert, California
George Miller, California            Doug Lamborn, Colorado
Mark Udall, Colorado                 Mary Fallin, Oklahoma
Joe Baca, California                 Adrian Smith, Nebraska
Nick J. Rahall, II, West Virginia,   Don Young, Alaska, ex officio
    ex officio
Vacancy
                                 ------                                

















                                CONTENTS

                              ----------                              
                                                                   Page

Hearing held on Thursday, June 12, 2008..........................     1

Statement of Members:
    Baca, Hon. Joe, a Representative in Congress from the State 
      of California..............................................     5
    Costa, Hon. Jim, a Representative in Congress from the State 
      of California..............................................     9
    Hastings, Hon. Doc, a Representative in Congress from the 
      State of Washington........................................     7
    Herger, Hon. Wally, a Representative in Congress from the 
      State of California........................................     8
    Lamborn, Hon. Doug, a Representative in Congress from the 
      State of Colorado, Prepared statement of...................    59
    McMorris Rodgers, Hon. Cathy, a Representative in Congress 
      from the State of Washington...............................     2
        Prepared statement of....................................     3
    Napolitano, Hon. Grace F., a Representative in Congress from 
      the State of California....................................     4
        Prepared statement of....................................     4
    Sali, Hon. Bill, a Representative in Congress from the State 
      of Idaho...................................................     6
        Prepared statement of....................................     6
    Smith, Adrian, a Representative in Congress from the State of 
      Nebraska...................................................     5
        Prepared statement of....................................     5

Statement of Witnesses:
    Corwin, R. Scott, Executive Director, Public Power Council, 
      Portland, Oregon...........................................    38
        Prepared statement of....................................    39
    Culbertson, Tim, General Manager, Grant County Public Utility 
      District, Ephrata, Washington..............................    51
        Prepared statement of....................................    53
    Eden, Melinda, Oregon Council Member, Northwest Power and 
      Conservation Council, Milton-Freewater, Oregon.............    20
        Prepared statement of....................................    22
    English, Hon. Glenn, Chief Executive Officer, National Rural 
      Electric Cooperative Association, Arlington, Virginia......    26
        Prepared statement of....................................    27
    Gruenspecht, Dr. Howard, Deputy Administrator, Energy 
      Information Administration, U.S. Department of Energy, 
      Washington, D.C............................................    17
        Prepared statement of....................................    18
    Howard, Bruce, Director, Environmental Affairs, Avista 
      Corporation, Spokane, Washington...........................    47
        Prepared statement of....................................    49
    Johnson, Robert W., Commissioner, Bureau of Reclamation, U.S. 
      Department of the Interior, Washington, D.C................    13
        Prepared statement of....................................    14
    Morton, Hon. Bob, Senator, State of Washington, Kettle Falls, 
      Washington.................................................    10
        Prepared statement of....................................    12
    Roos-Collins, Richard, Director of Legal Services, Natural 
      Heritage Institute, San Francisco, California..............    43
        Prepared statement of....................................    45


 OVERSIGHT HEARING ON ``HYDROPOWER: PROVIDING 75% OF AMERICA'S CURRENT 
 RENEWABLE ENERGY. EXPLORING ITS ROLE AS A CONTINUED SOURCE OF CLEAN, 
                   RENEWABLE ENERGY FOR THE FUTURE.''

                              ----------                              


                        Thursday, June 12, 2008

                     U.S. House of Representatives

                    Subcommittee on Water and Power

                     Committee on Natural Resources

                            Washington, D.C.

                              ----------                              

    The Subcommittee met, pursuant to call, at 2:51 p.m., in 
Room 1324, Longworth House Office Building, Hon. Grace 
Napolitano [Chairwoman of the Subcommittee] presiding.
    Present: Representatives Napolitano, Costa, Baca, McMorris 
Rodgers, and Smith.
    Also Present: Representatives Sali, Hastings, Herger, and 
Shadegg.
    Mrs. Napolitano. Good afternoon, and welcome to the meeting 
of the Subcommittee on Water and Power, which will now come to 
order.
    The purpose of today's meeting is to hold an oversight 
hearing at the request of Ranking Member Cathy McMorris Rodgers 
on ``Hydropower: Providing 75 Percent of America's Current 
Renewable Energy. Exploring its Role as a Continued Source of 
Clean, Renewable Energy for the Future.''
    Welcome to all Congress Members and my friend and 
colleague, the Ranking Member of the Subcommittee, Cathy 
McMorris Rodgers, and to our guests.
    And we are expecting some of our colleagues to join us, 
Congressman Bill Sali of Kuna, Idaho; and Congressman Doc 
Hastings of Pasco, Washington.
    Welcome, Doc and Mr. Sali.
    Congressman Wally Herger of Chico and Congressman John 
Shadegg of Arizona may also be joining us. And welcome.
    And I will turn it over to my colleague for her to continue 
the hearing.

STATEMENT OF THE HON. CATHY McMORRIS RODGERS, A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF WASHINGTON

    Mrs. McMorris Rodgers. I ask unanimous consent that 
Congressman Sali, Congressman Hastings, Congressman Herger and 
Congressman Shadegg be allowed to sit on the dais and 
participate in the Subcommittee proceedings today.
    Without objection, so ordered.
    After my opening statement, I will recognize all the 
members of the Subcommittee for any statement they may have. 
Any member who desires to be heard will be heard.
    Additional material may be submitted for the record by 
members, by witnesses or by any interested party. The record 
will be kept open for 10 business days following the hearing.
    The 5-minute rule with our timer will be enforced. Green 
means go. Yellow is just like the stop light; it means hurry up 
and end. Red means stop.
    I sincerely want to thank the Chairwoman of this 
Subcommittee, Grace Napolitano, for the opportunity to hold 
this hearing. It is quite unusual for a Chairwoman to recognize 
the request of a Ranking Member. And I like this, and I want to 
just applaud your willingness to listen and learn from some 
differing perspectives.
    As you know, I requested this hearing because, as Congress 
examines the facts surrounding global warming, I believe we owe 
it to the American people to be honest and realistic about how 
we are going to meet our energy needs. Today's hearing is the 
first step toward giving the American people and those inside 
the Beltway much-needed information about hydropower, which, in 
many ways, is an environmental success story.
    Hydroelectric dams across the West and especially in 
Washington State provide us with clean, affordable and 
renewable energy. In fact, dams provide nearly two-thirds of 
Washington State's electricity at a time when more than 50 
percent of the country is dependent upon coal. According to the 
Northwest Power and Conservation Council, these dams have kept 
the Pacific Northwest carbon footprint at half that of the rest 
of the Nation.
    I and many of my colleagues here today are here to showcase 
the low-cost energy promises that FDR, JFK and LBJ made to the 
West. The river systems throughout the Pacific Northwest are a 
critical part of our region's economy and should be used for 
transportation, irrigation and recreation. These dams built our 
economy and continue to contribute to our way of life.
    According to NOAA Fisheries, salmon survival in the 
Columbia/Snake River is higher today than before the dams were 
built. It is estimated that 98 percent of adult fish and 90 
percent of juvenile fish navigate the dams successfully.
    Despite the success, there continues to be some that wage 
war on the dams, namely the removal of the four lower Snake 
River dams, which happen to be in my district and Doc's. We 
heard about this at a recent Fisheries Subcommittee hearing 
from our Seattle colleague, Jim McDermott.
    Yet what was missing from that debate was the fact that the 
removal of the Snake River dams would add 5.4 million tons of 
CO2 to the atmosphere each year, and it would take three 
nuclear, six coal-fired, or 14 gas-fired power plants to 
replace their electricity generation. These dams also serve as 
the base resource for integrating wind energy into the 
Northwest grid.
    At a time of growing energy demand, it makes no sense to 
throw this clean energy source away. I am committed, as we move 
forward with the debate on global climate change, that 
hydropower be recognized for the important role it plays in our 
markets. If the Chicago Climate Exchange can accept hydro from 
Chelan County PUD as a carbon offset, Congress should be able 
to do the same.
    I hope today's discussion is the start to a better 
understanding of the value hydropower has, and look forward to 
forming a bipartisan congressional caucus to protect and 
promote hydropower.
    We are privileged to have before us today some of the best 
and brightest energy experts. I welcome our distinguished 
witnesses.
    And thank you, once again, Madam Chairwoman, for having 
this hearing.
    [The prepared statement of Mrs. McMorris Rodgers follows:]

           Statement of The Honorable Cathy McMorris Rodgers 
            Ranking Member, Subcommittee on Water and Power

    I sincerely thank you for extending this opportunity for holding 
this much-needed hearing, Madam Chairwoman. It's a real pleasure to 
work with you on this and other important matters.
    As you know, I requested this hearing because as Congress examines 
the facts surrounding global warming we owe it to the American people 
to be honest and realistic about how we are going to meet our energy 
needs. Today's hearing is our first step towards giving the American 
people and those inside-the Beltway much-needed information about 
hydropower, which in many ways is an environmental success story.
    Hydroelectric dams across the West and especially in Washington 
state provide us with clean, affordable, and renewable energy. In fact, 
dams provide nearly two-thirds of Washington state's electricity, at a 
time when more than 50% of the country is dependent upon coal. 
According to the Northwest Power and Conservation Council, these dams 
have kept the Pacific Northwest's ``carbon footprint'' at half that of 
the rest of the Nation.
    According to The Wenatchee World, carbon-free hydropower is the 
``power source that much of the regional environmental community 
consistently maligns, or attacks by devious, litigious means.'' The 
editorial goes on to say that ``we should learn to appreciate the fact 
that our regional impact on the atmosphere, and potentially on climate 
change, is significantly reduced because our economy is powered by 
falling water.'' I couldn't agree more.
    I--and many of my colleagues here today--are here to showcase the 
low-cost energy promises that FDR, JFK and LBJ made to the West. The 
river systems throughout the Pacific Northwest are a critical part of 
our region's economy and should be used for transportation, irrigation 
and recreation. These dams built our economy and continue to contribute 
to our way of life.
    According to NOAA Fisheries, salmon survival in the Columbia and 
Snake rivers is higher today than it was before the dams were built. 
It's estimated that 98% of adult fish and 90% of juvenile fish navigate 
the dams successfully.
    Despite this success, there are still some that continue to wage 
war on dams, namely the removal of four lower Snake River dams. We 
heard about this at a recent Fisheries Subcommittee hearing from our 
Seattle colleague, Jim McDermott. Yet, what was missing from that 
debate was the fact that removal of the Snake River dams would add 5.4 
million tons of C02 to the atmosphere each year and it would take three 
nuclear, six coal-fired, or 14 gas fired power plants to replace their 
electricity generation. The dams also serve as the base resource for 
integrating wind energy into the Northwest grid.
    At a time of growing energy demand, it makes no sense to throw this 
clean energy source away. I am committed, as we move forward with the 
debate on global climate change, that hydropower be recognized for the 
important role it plays in our markets. If the Chicago Climate Exchange 
can accept hydro from Chelan County PUD as a carbon offset, Congress 
should be able to do the same.
    I hope today's discussion is the start to better understanding the 
value of hydropower here in Congress and look forward to forming a bi-
partisan Congressional Caucus to protect and promote hydropower.
    We are privileged to have before us today some of the best and 
brightest energy experts before us today. I welcome our distinguished 
witnesses and thank you once again, Madame Chairwoman, for having this 
hearing.
                                 ______
                                 

  STATEMENT OF THE HON. GRACE NAPOLITANO, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mrs. Napolitano. You are very welcome, Mrs. McMorris 
Rodgers.
    And I, too, have a great interest in hydropower. I am glad 
that my colleague had asked that we look at it.
    We need to look at every single source of assistance to 
developing hydropower and how well some of the grids are doing 
and how we can connect newly developed power and how can we 
begin to look at how everybody is deeming whether hydropower is 
taxable or nontaxable--all the little intricacies that 
everybody is now facing--how do we help be able to make it more 
feasible to add to that, to serve the growing constituency of 
ours throughout the United States. It isn't just in Cathy's 
area or in mine, but throughout many areas of our country.
    It is a very important issue, and I am glad that she raised 
it. I am happy to join forces to have a look-see and get more 
input, information so that possible legislation that will help 
address what is being faced currently and being able to ask the 
bureau and possibly the Army Corps to be partners along with us 
in addressing these issues.
    And, with that, Mrs. McMorris Rodgers, thank you very much.
    [The prepared statement of Mrs. Napolitano follows:]

      Statement of The Honorable Grace F. Napolitano, Chairwoman, 
                    Subcommittee on Water and Power

    Good morning. This meeting of the Subcommittee on Water and Power 
will come to order.
    The purpose of today's meeting is to hold an Oversight Hearing on 
``Hydropower: Providing 75% of America's Current Renewable Energy. 
Exploring its role as a continued source of Clean, Renewable Energy for 
the Future.''
    We welcome all Congress Members, especially my friend and colleague 
Ranking Member of this Subcommittee, Congresswoman Cathy McMorris 
Rodgers. Welcome to guests to the Subcommittee today, we are expecting 
our colleagues Congressman Bill Sali of Kuna, ID, Congressman Doc 
Hastings of Pasco, WA, and Congressman Wally Herger of Chico, CA. 
Congressman John Shadegg of Arizona also might be able to join us. 
Welcome.
    After my opening statement, I will recognize all other Members of 
the Subcommittee for any statement they may have. Any Member who 
desires to be heard will be heard. Additional material may be submitted 
for the record by Members, by witnesses, or by any interested party. 
The record will be kept open for 10 business days following the 
hearing. The five-minute rule with our timer will be enforced, green 
means go, yellow near end, and red means stop.
    Today's hearing is at the request of Ranking Member McMorris 
Rodgers. This is a very important issue to her and her constituents. I 
am eager to learn more about the connection between water availability 
and hydropower capacity.
    We look forward to hearing from all witnesses. Thank you all for 
being here today. I am pleased to now yield to my friend and colleague, 
Ranking Member Congresswoman Cathy McMorris Rodgers, for her statement.
                                 ______
                                 
    Mrs. McMorris Rodgers. We will start by recognizing 
Subcommittee members, and I will ask everyone to keep their 
statements as short as possible. They can be submitted for the 
record.
    Mr. Smith from Nebraska?

    STATEMENT OF THE HON. ADRIAN SMITH, A REPRESENTATIVE IN 
              CONGRESS FROM THE STATE OF NEBRASKA

    Mr. Smith. Thank you.
    Well, just very briefly, I would like to point out that 
this hearing is very important. And certainly I am energized 
to--no pun intended--hear more about the potential for 
hydropower. I know that in Nebraska we have some smaller 
projects, but they are vital in their functioning, and 
certainly it is relevant to our issues today.
    Thank you.
    [The prepared statement of Mr. Smith follows:]

 Statement of The Honorable Adrian Smith, a Representative in Congress 
                       from the State of Nebraska

    Good afternoon and thank you, Chairwoman, for agreeing to hold this 
hearing today entitled, ``Hydropower: Providing 75% of America's 
Current Renewable Energy. Exploring its role as a continued source of 
Clean, Renewable Energy for the Future.''
    I long have been an advocate of energy policy designed to boost 
domestic supplies of all sources of energy in an environmentally-safe, 
affordable, and reliable way. While energy is a topic on everyone's 
mind, I want to be sure hydropower is included and promoted as an 
energy source.
    My home state of Nebraska has benefited from clean, inexpensive, 
renewable hydropower, and we have the potential to produce more. Demand 
for electricity continues to grow, giving all sources of energy, 
including hydropower, an increasingly important role for the future.
    As we encourage more renewable energy production, hydropower offers 
a viable option for consumers. Not only is hydropower emissions-free, 
but it also serves as a more consistent means of regulating the flow of 
electricity for the power grid.
    Furthermore, hydropower projects in my district also serve 
irrigation, flood control, and recreation activities. Agriculture is at 
the center of Nebraska's economy and many of my constituents rely on 
irrigating farmland. In addition, hydropower's reservoir system 
provides optimal habitat for many species of fish and wildlife. Because 
of our multi-purpose dams and reservoirs, more fishing, hunting, 
boating and other recreational opportunities are available for all 
Nebraskans to enjoy.
    I appreciate the Subcommittee for holding this hearing on the 
importance of hydropower. As a Nebraskan and a member of this 
Subcommittee, I want to ensure our energy policy is properly 
prioritized. I look forward to learning more from all of our witnesses.
    Chairwoman, I look forward to working with you on increasing the 
use of clean, renewable, affordable hydropower.
    Thank you.
                                 ______
                                 
    Mrs. McMorris Rodgers. Thank you.
    Mr. Baca?

 STATEMENT OF THE HON. JOE BACA, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Baca. Well, thank you very much.
    First of all, I want to thank the Chair, Grace Napolitano, 
and you, Mrs. McMorris Rodgers, for holding this hearing.
    When we look not only at hydropower, but when you look at 
water and power and what it means to our country right now, it 
is an area that we need to address because not only how it 
impacts us now, but how our country will be faced in terms of 
the future.
    So I am glad that we are going to be addressing a lot of 
these issues as we begin to look at how our cities will operate 
within each of our areas and how we can turn around and use not 
only water and power to meet our energy needs.
    So, with that, thank you very much for having this hearing.
    Mrs. McMorris Rodgers. Thank you.
    Mr. Sali?

 STATEMENT OF THE HON. BILL SALI, A REPRESENTATIVE IN CONGRESS 
                    FROM THE STATE OF IDAHO

    Mr. Sali. Thank you, Madam Chair.
    A couple of things.
    First of all, Idaho ranks number nine in the Nation for 
installed hydropower generation capacity, but it is first in 
net generation capacity. Eighty-four percent of the net 
generation in Idaho is provided by hydropower.
    There are great benefits, including cost, at 4.92 cents per 
kilowatt hour compared to the national average of 8.9 cents per 
kilowatt hour. Everybody knows hydropower is clean, it is 
renewable, it is reliable, it is pollution-free.
    Today the Brookings Institute has released an economic 
vitality report, and it ranks Boise, Idaho, better overall than 
any other metro area in the United States. The study was based 
on three key measures of economic vitality, which are 
productivity, social inclusion and environmental 
sustainability. The study found that the Boise-Nampa metro area 
ranked fifth nationally for the lowest per capita carbon 
footprint in the Nation. And it was reported that, in general, 
Western states fared better in the rankings--and I am quoting 
from the study--``primarily because the region relies on clean 
hydropower for most of its electricity.''
    The conclusion of this study is that other metro areas in 
the United States ought to try and emulate places like Boise, 
Idaho, and our reliance on hydropower and the electricity that 
comes from it, which keeps our carbon footprint very low.
    You know, we will have a lot of discussion today about the 
millions of tons of carbon emissions that are saved by using 
hydropower in the United States. With that, Madam Chair, I will 
cut off my opening statement and submit it for the record.
    [The prepared statement of Mr. Sali follows:]

  Statement of The Honorable Bill Sali, a Representative in Congress 
                        from the State of Idaho

    Madam Chairwoman,
    At a time of increasing discussion about energy resources that are 
efficient as well as friendly to the environment, hydropower fits the 
bill to a ``tee.'' Hydropower is clean, renewable, reliable, and 
pollution free, generating electricity using the pull of gravity on 
water as it flows down river.
    The advantages of hydropower are numerous. For example, the cost of 
producing power is extremely low. Its power generation is flexible 
enough to respond quickly to energy demands. It's two times more 
efficient to produce than any other source. And it produces no 
greenhouse gasses.
    I'm from the Northwest where hydropower accounts for more than 60 
percent of the power generated there. The great State of Idaho ranks 
ninth in the nation for installed hydropower generation capacity, and 
first for net generation from hydropower. A full 84 percent of the net 
generation in Idaho is provided by hydropower.
    The benefits of hydropower are directly reflected in the price of 
electricity. Idaho has the lowest average retail cost of power in the 
country, at 4.92 cents per kilowatt hour, compared to the national 
average of 8.90 cents.
    Together with the overall reduction in carbon emissions, hydropower 
plays a key role in the quality of life we enjoy in Idaho. The 
Brookings Institution's economic vitality report being released today 
ranks Boise, Idaho better overall than any other metro area in the 
United States. The study was based on three key measure of economic 
vitality productivity, ``social inclusion'' and ``environmental 
sustainability.'' The study found that the Boise-Nampa metro area 
ranked fifth nationally for the lowest per-capita ``carbon footprint'' 
in the nation. It was reported that in general, western states fared 
better in the rankings, ``primarily because the region relies on clean 
hydropower for most of its electricity.''
    Last year alone, we avoided some 160 million tons of carbon 
emissions by the use of hydropower here in the United States. Without 
hydropower this electricity would be replaced by other energy sources, 
exponentially increasing carbon emissions, particularly in the 
Northwest.
    And yet, there are those who want to remove some of the largest 
hydroelectric generators in the Northwest. Less than a month ago, we 
held a hearing that focused on breaching hydropower dams. That 
proposition has been studied over and over again at taxpayer expense, 
both under Democrat and Republican administrations, and the result has 
always been the same-it has never been recommended that the dams be 
removed.
    The fact remains: there are significant environmental consequences 
if the dams are breached. And these are consequences of which my 
constituents will bear the brunt.
    I am pleased to be sitting here today discussing the benefits of 
hydropower, and consider both our current capacity and the future of 
hydropower in this country.
                                 ______
                                 
    Mrs. McMorris Rodgers. Thank you.
    Mr. Hastings?

    STATEMENT OF THE HON. DOC HASTINGS, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF WASHINGTON

    Mr. Hastings. Thank you very much, Madam Chairman, and 
thank the Ranking Member for allowing me to sit on the dais 
with you. I had the opportunity to serve on this committee my 
first term in Congress, and things haven't changed much. I 
think the pictures have been moved around a little bit. But I 
do want to thank you very much for the opportunity to be here 
today.
    And I would ask unanimous consent that my full statement 
appear in the record.
    I would like to just acknowledge two people that are going 
to be on these panels from eastern Washington.
    The first is Bob Morton, over on our far left. Bob is a 
leader in the Washington legislature. He is a State Senator on 
natural resource issues. And a lot of the things that he does 
and his staff do are looked at and consumed by a lot of people 
in the Northwest. So I want to acknowledge Bob Morton here.
    And then on the second panel is Tim Culbertson. And Tim is 
the general manager of the Grant County Public Utility 
District. And they just recently--they have two non-Federal 
dams on the Columbia River, and they just recently got FERC 
relicensing on both of those dams. And Tim has been a leader in 
power issues within the Northwest.
    I should also recognize Glenn English, who was a former--I 
wasn't here when Glenn was in the Congress, but he represented 
Oklahoma's 6th District for many years before becoming CEO of 
National Rural Electric Coop.
    There has been a lot of discussion about hydropower. I just 
want to make a couple of facts, because those of us in the 
Northwest recognize how important hydropower is. But just a 
couple of facts.
    Annual hydropower output is equivalent to energy produced 
by 200 million barrels of oil. Hydropower is clearly the most 
efficient form of electrical generation.
    Hydro backs up other renewable energy sources, such as wind 
and solar. Just keep in mind, wind power doesn't work unless 
the wind is blowing, and solar power doesn't work unless the 
sun is shining. Hydro, of course, works because it is water 
going downhill, and it is a good back-up for these other energy 
sources.
    And hydro offsets more carbon emissions than all other--all 
other--renewable energy sources combined. And we are a leader 
in the Northwest, as far as carbon emissions in the Northwest, 
and it is principally because of hydropower.
    So as we are going to have this discussion about global 
warming and carbon offsets and all these sort of things, I 
think what we need to do is continually push hydropower, 
because it is very, very clean.
    And I thank both of you for holding this hearing. I think 
it is a very, very important hearing that we can get from 
people that are in the field the benefits of hydropower.
    So, with that, Madam Chairman, I yield back my time.
    Mrs. McMorris Rodgers. Thank you very much.
    Mr. Herger?

    STATEMENT OF THE HON. WALLY HERGER, A REPRESENTATIVE IN 
             CONGRESS FROM THE STATE OF CALIFORNIA

    Mr. Herger. Thank you very much, Madam Chairwoman and 
Ranking Member. I thank you for holding today's oversight 
hearing and for allowing me to participate.
    There has been a tremendous amount of interest in the 
development of new technologies to help guide a clean energy 
future for our Nation. But as we develop the next generation of 
energy sources, we cannot overlook the importance of 
hydroelectricity, a time-tested, proven, renewable energy 
technology that is widely available today.
    No other clean, renewable energy source provides the same 
combination of cost effectiveness, efficiency and dependability 
as our Nation's hydropower facilities. The premier 
hydroelectric facility in my home State of California, Shasta 
Dam, currently provides enough emissions-free electricity to 
serve up to 700,000 households. Clean energy from Shasta Dam 
has helped the city of Redding, the largest city in my northern 
California congressional district, develop an impressive 
renewable energy portfolio. Indeed, 25 percent of Redding's 
electricity comes from hydropower, making it one of the most 
renewable-friendly cities in our Nation.
    Madam Chairwoman, the mayor of Redding has sent me this 
letter on the benefits of hydroelectricity. And, with your 
permission, I would like this letter to be made a part of 
today's hearing record.
    Mrs. McMorris Rodgers. So ordered.
    Mr. Herger. Thank you.
    [NOTE: The letter submitted for the record by Mr. Herger 
has been retained in the Committee's official files.]
    Shasta Dam is also incredibly efficient. Recent upgrades 
allow the turbines at Shasta to utilize up to 98 percent of the 
energy stored in each acre-foot of water that passes through 
the dam. Fossil fuels are critically important to our energy 
security, but no fossil energy plant can match that high level 
of efficiency.
    Like other hydro facilities, Shasta Dam can also respond to 
the changing energy needs of its customers literally in a 
matter of seconds, something that simply can't be done at a 
thermal energy plant. In addition to its virtues as an energy 
source, Shasta Dam delivers other critically important 
benefits, such as water storage, flood control and recreation.
    Madam Chairwoman, as Congress continues to look for ways to 
encourage clean and reliable energy to power our Nation, 
hydroelectricity must remain at the forefront of this 
discussion. In my view, rather than tearing down dams, we 
should be looking for opportunities to build more.
    Thank you again for holding this hearing. I look forward to 
listening to today's witnesses.
    Mrs. McMorris Rodgers. Thank you.
    Next, Mr. Costa?

 STATEMENT OF THE HON. JIM COSTA, A REPRESENTATIVE IN CONGRESS 
                  FROM THE STATE OF CALIFORNIA

    Mr. Costa. Thank you very much, Madam Chairwoman, for both 
of your efforts in holding this afternoon's hearing. It is 
important. Hydroelectric power does provide the majority of 
America's renewable energy supply. And, in California, it has 
been doing that for over 100 years.
    We have one project called the Big Creek Project that 
provides water to southern California, and it used to be dubbed 
the ``hardest working water in the world'' and, in the 1930s, 
provided half the electrical supply for the city of Los 
Angeles. Now, Los Angeles has grown since the 1930s, so it 
doesn't provide quite as much of their total source of power, 
but nonetheless it is still an important increment of southern 
California's power, along with Shasta, as my colleague, Mr. 
Herger, noted, and other very important hydroelectric projects 
throughout the State as well as throughout the Nation.
    In addition, we have also implemented, where the economics 
have worked, small hydro, where we have used just our canals to 
put small hydro systems on that maybe only can operate for an 
irrigation season of 2 months or 3 months based upon water 
availability. And they play a role, as well.
    I guess what I am going to be looking for, in terms of the 
expert testimony this afternoon, is, with the changes occurring 
in climate--and it doesn't matter whether or not you subscribe 
to man's impact on the climate, I can tell you it is changing. 
It has been changing ever since the planet has been here. We 
have had ice ages. It is changing. Now, how much we are 
contributing is another debate, but it is changing.
    And with the changes, with late winters, early springs, how 
do we operate these projects? In every hydroelectric project we 
have a certain capacity that is built in--whether it is Shasta 
or whether it is the Big Creek Project, or any others--for 
water supply, for municipal and irrigation use, for farms. We 
have a certain amount that is for flood control, and we have a 
certain amount that is for electrical generation. And sometimes 
when it is optimum to generate power, we may need to keep that 
water there for our farms, or we may need to maintain the 
adequate reservoir supply for our city's use, not to mention 
being prepared every wintertime for a big flood that may occur 
based upon the amount of snowpack that you get.
    So I am wondering what kind of work is being done to 
determine how we operate these projects in light of changing 
weather conditions.
    So, with that said, I want to thank you all, and I look 
forward to the testimony.
    Mrs. McMorris Rodgers. Thank you.
    Madam Chairwoman?
    Mrs. Napolitano. Thank you, Madam Chairwoman.
    I would like to ask this committee for a moment of silence 
for former Commissioner Keys who perished in an airplane 
accident. He was a good public servant that we had the greatest 
respect for. So if I may, Madam Chair, I would like to ask for 
one moment of silence.
    Mrs. McMorris Rodgers. Yes.
    Thank you. I might also mention to the committee members 
someone, I think it might have been the Chairwoman, made some 
cupcakes that you can find in the back when you need a little 
nourishment. And I can testify she is a good cook.
    OK. Let's get to those that have traveled, some a long 
distance, to be here today. Our first panel, we have The 
Honorable Bob Morton, Washington State Senator from Kettle 
Falls, Washington. Next, Bob Johnson, Commissioner of the 
Bureau of Reclamation here in Washington, DC; Dr. Howard 
Gruenspecht, Deputy Administrator of the Energy Information 
Administration here in Washington, DC; Melinda Eden, Oregon 
Council Member from the Northwest Power and Conservation 
Council. She is from Milton-Freewater, Oregon. And, finally, 
The Honorable Glenn English, chief executive officer of the 
National Rural Electric Cooperative Association in Arlington, 
Virginia. Mr. English also served as a Member of Congress from 
Oklahoma's 6th Congressional District for 10 successive terms.
    So welcome, everyone.
    We will start with Senator Morton.

          STATEMENT OF THE HON. BOB MORTON, SENATOR, 
         STATE OF WASHINGTON, KETTLE FALLS, WASHINGTON

    Mr. Morton. Thank you, Acting Chairwoman McMorris Rodgers, 
and thank you, Madam Chairwoman of the committee, Chairwoman 
Napolitano.
    Yes, I am Robert Morton. I serve in the legislature in the 
State of Washington in the Senate and on most of the natural 
resources, energy, environment and water committees. And I 
understand one of my tasks today is to bring a little 
background of the history of our area.
    I share my district in bordering with both the acting 
Chairwoman and with Congressman Hastings. And together I have, 
with them on the one shoreline and me on the other, all of the 
waters behind Grand Coulee, but many of the dams, both in the 
Snake River and the Pend Oreille River.
    I might mention that the Pend Oreille supplies one-third of 
the water volume into the Columbia where they merge, and most 
people don't realize that. The heaviest flows come out of, of 
course, British Columbia, Alberta, and down into Idaho, Montana 
and then into Washington.
    We have 55 major dams; 29 of those are projects of the 
Federal Government. And it is important to point out that the 
remaining non-Federal dams primarily come from the local PUDs, 
the public utility districts. The Bonneville Power 
Administration, the BPA, administers and distributes the power 
supply from these dams, a unique arrangement based in Portland, 
Oregon.
    If you ever have the opportunity to be there, it is very 
educational. No Federal tax dollars are involved in this. It is 
paid for by the recipients, the ratepayers. And it provides us, 
as many of you had mentioned, with some of the cleanest power 
that we have.
    Yes, the hydropower is sold in the summertime to those who 
need it. In the wintertime, we have to buy much of the water 
and/or the electricity that is supplied by the water. However, 
because of the statistics that are used, there has been some 
assumption that the hydropower in the Northwest is all tapped 
out. This simply is not true. The many undeveloped sites still 
remain where we can place dams, create the pools for the flow 
for generation of the power.
    We also must recognize that many of the dams that are there 
are not storage dams. They are run of the river. And that makes 
a big difference in examining them--and one of the points I 
would make later--examining the potential of increasing the 
height of these dams and therefore capturing much of the 
snowpack that comes out of Canada for us.
    Seventy-five percent of Northwest's energy transmission is 
also under the jurisdiction of BPA. So we must look not only at 
the dams and the storage and the generation; now we have the 
power generator, how do we transmit it? And we are in great 
need of improved enlarging of our transmission.
    It is interesting to note, to give you a little comparison, 
the Columbia basin area alone, which is primarily what we refer 
to as the Columbia basin of the Columbia River, is 260,000 
square miles. And that is an area that is equal to the Nation 
of France, just to put it in perspective.
    In distributing this power, it is also the responsibility, 
then, of BPA. The Bonneville Power Administration then offers 
it first, by Federal law, offers it first to the local areas, 
regions. And if they do not need it, then they can go ahead and 
sell it.
    As I mentioned, we have, however, the ability to both sell 
or export and import--export during the summer months, and then 
we need to import during the winter months. It is a reliable, 
affordable and renewable, with no greenhouse gases emitted.
    Mrs. McMorris Rodgers. Senator Morton, I am going to----
    Mr. Morton. I see the red light.
    Mrs. McMorris Rodgers. Yeah, it is already the red light. 
And what I would just ask is--I think we will have some more 
time toward the end in Q&A for you to make some more of your 
points. Thank you very much.
    Mr. Morton. Thank you.
    [The prepared statement of Mr. Morton follows:]

    Statement of The Honorable Bob Morton, Washington State Senator

    Chairwoman Napolitano, Ranking Member McMorris Rodgers, and Members 
of the Subcommittee, thank you for holding this important hearing 
regarding the benefits and future uses of hydropower.
    My name is Bob Morton and it has been my pleasure and privilege to 
serve the 7th Legislative District since 1990 and the state Senate 
since 1994. I am currently the Ranking Member of the Natural Resources, 
Ocean and Recreation Committee and sit on the Water, Energy and 
Telecommunications as well as the Agriculture and Rural Economic 
Development committees.
    For the past 70 years, since the construction of Bonneville Dam, 
the states of Washington, Oregon, Idaho, and Montana have relied 
heavily on hydroelectric power. There are 55 major and several minor 
hydroelectric projects on the Columbia, Snake, and Pend Oreille rivers 
and their tributaries. Twenty-nine of these projects are federal. The 
remaining are non-federal and include numerous Public Utility District 
(PUD) projects.
    The Bonneville Power Administration (BPA) markets and distributes 
the power generation from the federal dams at cost-based-rates and 
receives no federal tax dollars for its operation. The Northwest 
ratepayers pay the costs of the BPA system. BPA supplies up to 45 
percent of the electricity used in the Northwest, of which more than 80 
percent is generated by clean, emissions-free hydropower. The Northwest 
exports hydroelectric power in the summer months derived from the 
melting snows of the north and imports electricity in the winter. The 
regions power supply totals 32,000 megawatts.
    There are assumptions in some quarters that hydropower in the 
Northwest is tapped out. However, this is false. There are many 
undeveloped sites for hydropower generation where capacity can be 
tapped, for example, utilizing smaller turbine technology in tributary 
streams and by increasing the height of some of the present dams. Most 
of the hydroelectric dams of the Columbia Basin are non-storage dams 
that utilize the run of the river to generate electricity.
    To transmit the electricity from its source to its user is a major 
part of the process. BPA owns, operates and maintains about 75 percent 
of the Northwest's high voltage transmission system. This includes 
interconnections and interregional transmission throughout the western 
grid system. The Columbia River Basin alone covers 260,000 square 
miles, an area roughly the size of France.
    To ensure that benefits from the Columbia River hydropower system 
flow to the Northwest under federal law, BPA gives preference to 
Pacific Northwest utilities in power sales. BPA sells power outside the 
region, but only after the power has been offered within the region 
first and is surplus to regional needs.
    In addition to being a reliable, affordable renewable energy 
source, a benefit of our hydro system is that it emits no greenhouse 
gases when it generates electricity.
    According to the Northwest Power and Conservation Council, the 
average annual hydropower production in the Northwest is about 16,400 
average megawatts, or almost 144,000,000 megawatt hours. If those same 
megawatt hours would have been generated by conventional coal plants, 
more than 153,000,000 tons per year of additional greenhouse gases 
would have been emitted. Hydro power is emissions free.
    Another way of looking at this benefit is to consider what happens 
with carbon emissions when we have a low water year. For instance, in 
2005, those emissions from the electric sector in the Northwest 
increased by 10,000,000 tons over average due to a below average water 
year. Because of that low water year, the region had to call on more 
thermal generators fired by fossil fuels to meet our needs. We need 
more water storage for future energy needs.
    As you, the Members of Congress, engage in the dialogue about 
reducing greenhouse gas emissions, please remember that my state, 
indeed the country, is starting at a lower greenhouse gas emissions 
level than would have been without the Northwest's foresight to develop 
the hydroelectric generating system. We ask that you recognize this and 
other benefits of the hydro system and act to preserve, protect and 
enhance this very beneficial clean, renewable, domestic energy resource 
as you move forward with legislation to produce renewable energy, and 
energy security.
    Thank you for this opportunity to appear before you today. I look 
forward to answering any questions you may have.
    [NOTE: Attachments have been retained in the Committee's official 
files.]
                                 ______
                                 
    Mrs. McMorris Rodgers. Next we will move on to Robert 
Johnson.

    STATEMENT OF ROBERT W. JOHNSON, COMMISSIONER, BUREAU OF 
                  RECLAMATION, WASHINGTON, DC

    Mr. Johnson. Thank you. It is a pleasure to be here today 
and to provide the Department of the Interior's views on 
Reclamation's hydropower resources and the public benefits they 
provide.
    While Reclamation is best known as the supplier of water, 
generating electricity is also a very important part of our 
mission. We characterize Reclamation as a water and power 
organization, and we are extremely proud of our role.
    Hydropower is the most efficient way to produce energy. 
Each kilowatt hour of hydroelectricity is produced in an 
efficiency of more than twice that of thermal energy sources. 
Hydropower is extremely flexible, can rapidly change its output 
to match needs, going from no generation to maximum generation 
in a very short period of time.
    Reclamation is not new to the power generation business. 
Since 1909, power revenues have contributed over $10 billion in 
project repayment for the Reclamation program. We operate 58 
hydropower plants, which produce 44 million megawatt hours of 
electricity per year, enough to supply over 6 million 
households. The energy produced by Reclamation facilities 
replaces about 48.4 billion pounds of coal and avoids 
production of roughly 51 million pounds of carbon dioxide that 
would have been produced by fossil fuel power plants.
    Our hydro plants also play an important role in reliability 
of the electric grid. Most traditional power plants cannot 
restart themselves in the event of a total loss of power. But 
hydroelectric generators, since they can be started without 
external power, could be used to restart the system in the 
event of a blackout. Reclamation has 18 of its hydroelectric 
power plants identified as part of these blackstart restoration 
plans.
    Another benefit of hydropower is the revenue it creates for 
endangered species recovery. For Fiscal Years 2002 through 
2006, Bonneville Power Administration hydropower revenues 
provided a rough average of $260 million for salmon recovery 
per year. This money has funded state-of-the-art programs to 
re-establish self-sustaining populations of endangered fish. 
Other hydropower facilities also provide funding for 
environmental programs throughout Reclamation.
    Hydropower also enables other renewable power like wind 
generation to be more usable. Wind generation is intermittent, 
and it needs ancillary support services to be integrated into 
an electric grid. Hydropower provides this quick response 
necessary to enable getting wind-generated power to the load.
    Having said all this, Reclamation faces many challenges in 
operation of its power plants. Traditionally, operation of 
power plants allowed for water releases to be timed so that 
generation coincided with the higher daytime electricity 
demand. This is referred to as ``load following'' and is one of 
the most significant benefits of hydro generation.
    However, this traditional operation is no longer routine 
because of new endangered species and environmental 
requirements. For example, endangered fish and Grand Canyon 
National Park values below Glen Canyon Dam have modified that 
facility's operations, significantly reducing the capability 
for meeting daily energy demand. Reclamation has necessarily 
incorporated these types of environmental demands at a number 
of our other facilities, as well.
    Through the cooperative efforts within the Department of 
the Interior and our customers and other stakeholders, it is 
possible to meet the various project purposes amidst these new 
demands. Reclamation has developed many innovative means of 
stretching existing resources to meet increasing demands or 
improve efficiency.
    An example: Since 2005, five turbines at Hoover Dam have 
received new wicket gates, which allows increased gate openings 
so that more water can flow through the turbines. These actions 
have increased generating capacity by 70 megawatts. An 
additional 29 megawatts is projected to be installed within the 
next 3 years. We estimate that a conservative value of this new 
energy is $3 million per year.
    The Bureau of Reclamation also has implemented benchmarking 
programs to compare its hydropower operations to the industry. 
We have found that our operations are competitive with other 
hydropower facilities, and we have also improved significantly 
our operations. An example would be at Hoover Dam we have 
improved our operations from being about average to actually 
resulting in a best-in-class determination for how we operate 
that plant and its efficiency.
    In closing, hydropower is an important part of our mission, 
and we will continue to work with our customers to provide this 
invaluable natural resource.
    This concludes my oral testimony. I am glad to respond to 
questions.
    [The prepared statement of Mr. Johnson follows:]

             Statement of Robert W. Johnson, Commissioner, 
         Bureau of Reclamation, U.S. Department of the Interior

    Madam Chairwoman and Members of the Subcommittee, I am Robert 
Johnson, Commissioner of the Bureau of Reclamation. I am pleased to 
provide the Department of the Interior's views on Reclamation's 
hydropower resources and the public benefits they provide.
    Hydropower is a very efficient way to produce energy. Each 
kilowatt-hour of hydroelectricity is produced at an efficiency of more 
than twice that of any other energy source. Further, hydropower is 
extremely flexible and reliable. Hydropower can rapidly change its 
output to match needs--going from no power generation to maximum power 
generation in a short period of time.
    While the Bureau of Reclamation is best known as a supplier of 
water for customers in the 17 western states, an equally important part 
of Reclamation's mission is the creation of electricity. In fact, we 
characterize Reclamation as a water and power organization. We are 
extremely proud of our hydropower program. Reclamation provides a 
clean, renewable source of power that has become an integral part of 
the electric system in the west.
    Reclamation is not new to the power generation business. Since 
1909, power revenues have contributed over $10 billion in project 
repayment to the Federal Treasury.
    In an effort to provide an effective overview of Reclamation's 
hydropower program, I would like to divide my testimony into three 
parts:
    1.  Reclamation's Existing Hydropower Resources
    2  RThe Current Challenges Facing Reclamation
    3  RThe Opportunities Reclamation Sees in the Future
Reclamation's Existing Hydropower Resources
    The Bureau of Reclamation manages water resources in the West. In 
the course of developing and managing these water resources, 
Reclamation built numerous projects with facilities that impound water 
to provide flood control and water supply for irrigation and municipal 
use. Along with those facilities, Reclamation constructed power plants 
to take advantage of the impounded water to generate clean, emission-
free electricity that could also be used to finance the undertaking of 
the various projects.
    Reclamation has 58 hydropower plants which, on an annual basis, 
produce over 44 million megawatt hours of electricity, enough to meet 
the needs of over 6 million households. Reclamation is the second 
largest producer of hydroelectric power in the western United States. 
It is worth noting that the energy produced by Reclamation facilities 
is the energy equivalent of replacing more than 80 million barrels of 
crude oil or about 48.4 billion pounds of coal. Further, Reclamation's 
facilities help to avoid the production of approximately 51 million 
pounds of carbon dioxide that would have been produced by fossil fuel 
power plants.
    Reclamation produces power that has an annual value to its 
customers of slightly less than $1 billion. This offsets power that 
would otherwise cost over $3 billion as estimated by the Energy 
Information Administration. This is a significant benefit to the 
Nation's economy. After the hydropower is produced, Reclamation 
provides it to the Western Power Marketing Administration, which owns 
and operates the transmission lines and is responsible for marketing 
the power to its customers. The revenue collected from the sale of 
power to its customers is then deposited into the Treasury. The 
hydropower Reclamation produces is used for project purposes and then 
is provided to the Western Power Marketing Administration for sale to 
its customers.
    Reclamation's hydropower plants also play an important role in the 
reliability of the electrical power grid. Most fossil and nuclear-
fueled generating plants cannot restart themselves in the event of a 
total loss of power. Hydroelectric generators, since they can be 
started without an external power source, have traditionally been 
relied upon to restart the electric power system in the event of a 
blackout. As one of the largest owners and operators of hydroelectric 
resources, Reclamation has a key capability in restoration of the 
system, a function known as ``blackstart.'' Reclamation has 18 of its 
hydroelectric power plants identified in blackstart restoration plans 
in the Western United States.
    One other benefit of hydropower generation is the revenue that is 
collected and used to mitigate the impact of dam operations on fish and 
wildlife, including those listed for protection under the Endangered 
Species Act (ESA). A good example of this is the Bonneville Power 
Administration's (BPA's) use of hydropower revenues in the Columbia 
River Basin to avoid jeopardizing ESA-listed salmon stocks and to 
generally mitigate fish and wildlife affected by the Federal Columbia 
River Power System as required under the Pacific Northwest Electric 
Power Planning and Conservation Act. For Fiscal Years 2002 through 
2006, BPA used hydropower revenues and borrowing authority repaid by 
revenues to provide an annual average of about $260 million for salmon 
recovery and mitigation efforts. This is nearly fifty percent of the 
average annual federal funding for Columbia River basin ESA 
implementation during the same time period. This money results from 
BPA's sale of hydropower produced at Reclamation and other facilities. 
This money has funded state of the art programs that are making a real 
difference in efforts to reestablish and maintain self-sustaining 
populations of endangered fish.
The Current Challenges Facing Reclamation
    Reclamation faces many challenges in the operation of its power 
plants, which are operated to provide a variety of benefits. These 
benefits are derived not just from the actual quantity of water 
released and the power generated, but also from the timing of the 
release of water.
    While the volume of water stored is a function of the weather, the 
timing of the releases for electrical generation usually is not. 
Traditionally, operation of the power plants allowed for water releases 
to be timed such that generation coincided with the higher daytime 
electricity demand. This is referred to as ``load following'' and is 
one of the most significant benefits of hydrogeneration. However, this 
traditional operation is no longer accepted as routine. The decisions 
on when to release the water are becoming more contentious as existing 
electric resources are unable to meet the electric demand and as 
environmental requirements increase.
    For example, in accordance with the Grand Canyon Protection Act of 
1992, the Glen Canyon Dam is now required to be operated to protect and 
improve the values for which Grand Canyon National Park and Glen Canyon 
National Recreation Area were established, in addition to the Dam's 
traditional authorized purposes. This has resulted in modification of 
the facility's operations and has had an impact on meeting daily load 
following demand. Reclamation has experienced these and other types of 
environmental demands at a number of our hydroelectric generation dams. 
In addition, future conflicts between competing resource needs may be 
more pronounced in the face of still unknown, basin-level impacts from 
environmental factors such as global climate change.
    Reclamation is one of many agencies and organizations that have 
been called upon to meet new challenges with existing resources, in 
ways that were never contemplated when our facilities were authorized, 
planned, and constructed. It is through cooperation and extensive 
dialogue within the Department of the Interior and among our 
stakeholders that the needs of the various project purposes are able to 
be met amidst these new demands. Through close interaction with the 
Fish and Wildlife Service, the National Park Service, the U.S. 
Geological Survey, the environmental community and our power customers, 
Reclamation develops operational regimes to meet a variety of goals 
across the West.
    To do this we work closely with public entities that purchase power 
generated at Reclamation facilities to improve the quantity and quality 
of power. Reclamation has developed many innovative means of stretching 
existing resources to meet the increasing demands or improve 
efficiency. As an example, since 2005, five of the 17 turbines at 
Hoover Dam have received new wicket gates and equipment modifications 
have been made to increase the gate opening so more water is allowed to 
flow through the turbines. These actions have increased the generating 
capacity at Hoover by 70 megawatts (MW). An additional 29 MW capacity 
gain is projected within the next three years, when work on three more 
units will be completed. Using a conservative market price for capacity 
($2,660 per MW-month), the value of 99 megawatts of new capacity at 
Hoover Dam is $3.16 million per year. The Bonneville Power 
Administration had directly funded 10 runner replacements at Grand 
Coulee Dam, creating 22.7 MW of additional energy per year.
    Also, pressures to improve the quality and safety of the existing 
electric resources have added a new dimension to Reclamation's 
decisions. The electric reliability standards necessary to ensure 
delivery of power and provide for competition among electricity market 
participants don't always recognize the variable and sometimes 
conflicting nature of decisions concerning hydroelectric supply. 
Reclamation is working closely with other federal entities involved in 
hydroelectric power to identify ways to reduce costs and improve 
reliability.
    This point also ties in with the challenges Reclamation faces from 
our aging infrastructure. We are working with our water and power 
customers on our infrastructure needs. As noted above, we are making 
improvements and upgrades where possible. With most of our power 
customers, we do not face the same financial challenges as with some of 
our water customers. Most of our power plants are directly funded by 
our power customers.
The Opportunities Reclamation Sees in the Future
    The future will present many opportunities for Reclamation to 
continue its successful hydropower program. The most obvious 
opportunity is to enhance or expand our power production capabilities 
to meet the increasing demands of our power customers.
    One of the most effective ways to improve efficiency is 
``benchmarking.'' In basic terms, benchmarking is a process by which an 
organization compares its systems against the best practices within an 
industry and then implements changes to improve system efficiency.
    Reclamation uses benchmarking as a tool to ensure decisions on 
operation and maintenance are cost effective. Reclamation's cost to 
produce electricity is just over half of what the industry average is 
for hydropower plants. As a result of benchmarking, our operations at 
Hoover Dam went from average to best in its class.
    We are also centralizing operations at Reclamation's Pick-Sloan 
Project and achieving efficiencies which benefit our power customers.
    In closing, hydropower is an important part of our core competency. 
Our power customers are a highly valued part of Reclamation's overall 
program, and we will continue to work with them to continue to provide 
this important resource while at the same time balancing the many 
competing interests.
    This concludes my written statement; I am pleased to answer any 
questions the Subcommittee may have.
                                 ______
                                 
    Mrs. McMorris Rodgers. Thank you very much.
    Next, Dr. Gruenspecht?

 STATEMENT OF HOWARD GRUENSPECHT, DEPUTY ADMINISTRATOR, ENERGY 
           INFORMATION ADMINISTRATION, WASHINGTON, DC

    Mr. Gruenspecht. Thank you, Madam Chairwoman, Ranking 
Member McMorris Rodgers, members of the Subcommittee. I 
appreciate the invitation to testify today on the current and 
future role of hydropower.
    The Energy Information Administration is the independent 
statistical and analytical agency within the Department of 
Energy. We don't promote, formulate or take positions on policy 
issues, unlike almost everyone else in Washington, and our 
views should not be construed as representing those of the 
Department of Energy or the administration.
    In 2007, conventional hydroelectric power production 
accounted for 248 billion kilowatt hours of electricity, or 71 
percent of total renewable generation in the United States. 
Most of the hydropower in the United States is located near the 
West Coast. In 2007, Washington, California and Oregon together 
accounted for 140 billion kilowatt hours, or 56 percent of 
total U.S. hydropower generation.
    While hydro capacity has been relatively constant in recent 
years, annual generation has varied quite significantly, 
primarily due to changes in precipitation.
    In its annual energy outlook, the Energy Information 
Administration publishes projections of supply and consumption 
to 2030 under the assumption that current laws and regulations 
remain in effect unless they are already scheduled to expire. 
In the projections issued earlier this year, less than one 
gigawatt of new conventional hydropower capacity is added by 
2030 and generation holds steady at approximately 300 billion 
kilowatt hours.
    It is important to note, however, that EIA does not yet 
include unconventional hydroelectric power technologies, such 
as wave, tidal or instream turbines, in its analysis since it 
is difficult to obtain reliable cost and performance estimates 
of technologies that are in their early phases of development.
    Generation using other renewable energy technologies is 
projected to grow quite rapidly over the same period, 
reflecting the effects of high fossil fuel prices, the 
availability of production tax credits under existing law, and 
mandatory renewable energy portfolio standards in over half the 
States. And, again, as mentioned by the two previous witnesses, 
hydropower has an important role in complementing intermittent 
renewables.
    The rules of State programs differ widely across the 
States. However, as a broad generalization, many State programs 
favor non-hydropower renewable energy sources over conventional 
hydropower.
    Policy proposals to limit emissions of greenhouse gases 
that were touched on in the opening statements could have a 
significant impact on the mix of fuels used to generate 
electricity, in particular by reducing the use of conventional 
coal-fired generation, which currently provides about half the 
Nation's electric generation and roughly one-third of total 
U.S. energy-related emissions of carbon dioxide.
    EIA has done analysis of many pieces of climate 
legislation, including the one that was considered in the 
Senate last week. And in those analyses, we projected an 
increase of 1.5 to over 6 kilowatts of hydro capacity in 2030 
relative to what we have in our reference case under current 
laws and regulations. And that range depends on the assumptions 
made regarding the cost and availability of low-emitting 
technologies, including nuclear fossil plants with carbon 
capture and storage and biomass. Many other renewables are 
affected to a much larger extent.
    The relatively limited growth for hydroelectricity is 
largely due to the limited supply of sites on which hydropower 
can be expanded or created. Most existing sites have some 
potential for incremental capacity, but the list of new sites 
in which new dams can be constructed is short.
    That said, there are some opportunities for conventional 
capacity improvements at exiting dams, as well as placing 
electricity turbines at sites that may be dammed but currently 
lack generators. As previously noted, our analysis did not 
consider wave, tidal or instream turbines, and that is another 
opportunity.
    Finally, while policies to limit greenhouse gas emissions 
would likely create new market opportunities for hydro, it is 
important to recognize that climate change itself could have 
major implications for generation at existing hydropower 
facilities. Because hydro generation is so sensitive to climate 
variability and weather patterns, even small changes in 
temperature and/or precipitation patterns could have 
significant impacts. Hydro plants could also be impacted if 
there were a change in the number or intensity of extreme 
weather events, but it is really very difficult to know whether 
that would be the case or not.
    This concludes my testimony, Madam Chairwoman. I would be 
happy to answer any questions you may have.
    [The prepared statement of Mr. Gruenspecht follows:]

      Statement of Dr. Howard Gruenspecht, Deputy Administrator, 
      Energy Information Administration, U.S. Department of Energy

    Madam Chairwoman and members of the Subcommittee, thank you for the 
invitation to testify today on the current and future role of 
hydropower. The Energy Information Administration (EIA) is the 
independent statistical agency within the U.S. Department of Energy. We 
are charged with providing objective, timely, and relevant data, 
analyses, and projections for the use of the Congress, the 
Administration, and the public. Although we do not take positions on 
policy issues, we do produce data and analyses to help inform energy 
policy deliberation. Because we have an element of statutory 
independence with respect to this work, our views are strictly those of 
EIA and should not be construed as representing those of the Department 
of Energy, the Administration, or any other entity.
    In 2007, domestic conventional hydroelectric power production 
accounted for 71 percent of renewable generation, which, in turn, 
accounted for 8 percent of all power generated in the United States. 
This translates into 248 billion kilowatt hours of electricity, 
although the amount has varied quite significantly in recent years 
without dramatic changes in hydroelectric capacity. For example, 356 
billion kilowatt hours were generated from conventional hydroelectric 
facilities in 1997, but these same plants produced only 217 billion 
kilowatt hours 4 years later. The wide variation in generation over 
this period is mainly a function of varying weather conditions, 
particularly changes in precipitation, since there was only a small 
change in installed capacity.
    Most of the hydropower in the United States is located near the 
West Coast. In 2007, Washington, California, and Oregon together 
accounted for 140 billion kilowatt hours, or fifty-six percent of total 
U.S. hydropower generation. Lesser amounts were generated in New York, 
Montana, Idaho, Arizona, Tennessee and Alabama, which were the other 
leading hydroelectricity producers in 2007. The geographic 
concentration of hydropower production in the West explains why years 
with scare precipitation and snowpack in that region can result in a 
dramatic reduction in total lower hydroelectric generation in the 
United States.
    In its Annual Energy Outlook (AEO), EIA publishes projections of 
energy supply and consumption to 2030, under the assumption that 
current laws and regulations remain in effect unless they are already 
scheduled to expire. In the AEO2008 projections, issued earlier this 
year, hydroelectricity continues to play an important role in the 
electric power sector, but its share in overall generation falls. Less 
than 1 gigawatt of new capacity is projected to be added by 2030, and 
generation holds steady at approximately 300 billion kilowatt hours. 
This contrasts with the growth of other renewable energy technologies 
over the same period. By 2030, the 71-percent share of renewable power 
that hydropower currently holds falls to just below 50 percent of total 
renewable generation. Hydroelectricity's share of total renewable 
generation is projected to decline because of the rapid rise in 
generation by other renewable technologies. It is important to note 
that EIA does not yet include unconventional hydroelectric power 
technologies, such as wave, tidal, or in-stream turbines in its model. 
Although these technologies may play a significant role at some point 
in the future, it is difficult to obtain reliable cost and performance 
estimates of technologies that are in their early, experimental phase 
of development.
    As noted, other renewable energy technologies are projected to grow 
at a much faster rate than hydropower. In the AEO2008 reference case, 
their growth is largely spurred by State renewable portfolio standards, 
and, in the very near-term, by the extension of the renewable energy 
production tax credit. Both of these are modeled in the EIA reference 
projection. The renewable energy tax credit is set to expire at the end 
of this year but will produce another year of strong wind power 
development. Currently, over half of the States have mandatory 
renewable energy standards. The rules of these programs differ widely 
among the States. Some States allow existing hydropower to be eligible 
in the State total, while others do not. Some have special mandates for 
non-hydropower renewable generation levels, meaning certain portions of 
renewable generation cannot be met through hydropower, even with 
incremental capacity. It is difficult to generalize from these vastly 
different programs, but generally they stress non-hydropower renewable 
energy sources over conventional hydropower.
    Policy proposals to limit emissions of greenhouse gas emissions, 
which are not reflected in the AEO2008 reference case projections, 
could have a significant impact on the mix of fuels used to generate 
electricity. Coal-fired generation currently provides about half of the 
nation's electric generation, producing roughly one-third of total U.S. 
energy-related emissions of carbon dioxide. Conventional coal-fired 
power would remain a very attractive option to meet growing baseload 
capacity needs absent any concern over the future level of U.S. 
greenhouse gas emissions. However, a stringent policy to reduce U.S. 
greenhouse gas emissions would likely engender an implicit or explicit 
value for carbon dioxide emissions that is high enough to significantly 
affect the cost of generating electricity using coal. This would create 
a need for additional supply of electricity from low- and no-carbon 
generation sources.
    In its recent analysis of S.2191, America's Climate Security Act of 
2007, EIA projects an increase of 1.5 to 6.1 gigawatts of hydropower 
capacity in 2030--depending on the alternative case assumptions used--
over the Annual Energy Outlook 2008 reference case in that same year. 
By comparison, there are between 40 and 275 gigawatts of new wind power 
capacity in the S.2191 cases than in the reference case in 2030. As is 
the case with hydropower, the wide range in wind power additions is 
driven by cost and availability assumptions for key low-emitting 
technologies, including nuclear, fossil plants with carbon capture and 
storage, and biomass facilities. When these technologies are assumed to 
be expensive or the ability to deploy them is limited, there is a much 
larger penetration of new wind and natural gas facilities. The 
relatively limited growth in the S. 2191 cases for hydroelectricity is 
largely due to the limited supply of sites on which hydropower can be 
expanded or created. Most existing sites do not have large potentials 
for incremental capacity, and the list of new sites in which new dams 
can be constructed is short. That said, there are some opportunities 
for conventional capacity improvements at existing dams, as well as 
placing electricity turbines at sites which may be dammed but currently 
lack generators. However, environmental concerns may limit such 
development and could lead to the retirement of some facilities when 
they come up for license renewal. As previously noted, our modeling did 
not consider wave, tidal, or in-stream turbines.
    Finally, while policies to limit greenhouse gas emissions would 
likely create new market opportunities for hydropower and other low- 
and no-carbon generation technologies, it is also important to 
recognize that climate change itself could have major implications for 
generation levels at existing hydropower facilities. In a recent 
report, the U.S. Climate Change Science Program and the Subcommittee on 
Global Change Research 1 pointed out that because 
hydroelectric generation is so sensitive to climate variability and 
weather patterns, even small changes could have significant impacts. 
Changes in temperature and/or precipitation patterns could both impact 
hydroelectric generation. Hydroelectric plants also could be impacted 
if there was a change in the number and/or intensity of extreme weather 
events. At this time, it is very difficult to quantify the potential 
impacts of such factors, and they are not reflected in our projections.
---------------------------------------------------------------------------
    \1\ U.S. Climate Change Science Program and the Subcommittee on 
Global Change Research, Effects of Climate Change on Energy Production 
and Use in the United States, U.S. Climate Change Science Program 
Synthesis and Assessment Product 4.5, October 2007.
---------------------------------------------------------------------------
    This concludes my prepared testimony, Madam Chairwoman. I will be 
happy to answer any questions you may have.
                                 ______
                                 
    Mrs. McMorris Rodgers. Thank you. I appreciate that.
    Ms. Eden?

  STATEMENT OF MELINDA EDEN, OREGON COUNCIL MEMBER, NORTHWEST 
    POWER AND CONSERVATION COUNCIL, MILTON-FREEWATER, OREGON

    Ms. Eden. Thank you. Good afternoon, Mesdames Chair and 
members of the Subcommittee. On behalf of the Council, thank 
you for the invitation to appear here today.
    The Council is a compact of the States of Idaho, Montana, 
Oregon and Washington created under the authority of the 
Northwest Power Act of 1980. Through its planning, the Council 
assures the Northwest region an adequate, efficient, economical 
and reliable power supply while also protecting, mitigating and 
enhancing fish and wildlife affected by hydropower dams in the 
Columbia River Basin.
    I have basically four points.
    First, the role of hydropower in the Northwest. With normal 
precipitation, hydropower dams in the Northwest provide about 
15,500 average megawatts or about 75 percent of all the 
electricity used in the Northwest. Most of the remainder is 
provided by power plants that burn natural gas or coal.
    The amount of electricity provided by other non-hydropower 
forms of renewables, particularly wind, is small but growing. 
Biomass plants provide less than 2 percent of the region's 
generating capacity. Geothermal and solar together provide less 
than 1 percent at this point. Wind power provides 4.7 percent, 
and that proportion is increasing.
    Second, as a result of renewable resource requirements in 
three of the Northwest States, development of wind and other 
renewable power sources will continue to grow. In fact, 
development of renewables, particularly wind, has been growing 
steadily for nearly a decade. Since 2000, our region has gained 
nearly 3,500 megawatts of wind power.
    That has important implications for hydropower, as others 
have mentioned, which provides back-up generation for times 
when the wind does not blow. One challenge we face is to 
integrate intermittent wind power into the power supply where 
it is critical that electricity flow at a steady, constant rate 
with no interruptions, even small ones.
    As the title of this hearing indicated, hydropower is clean 
and renewable. Hydropower in the mix reduces the output from 
power plants that burn fossil fuels.
    Last November, the Council reported the results of its 
year-long study of carbon dioxide emissions from Northwest 
power plants. The study demonstrates the moderating effect of 
the region's large hydropower base on carbon dioxide emissions 
otherwise produced by the power system, especially compared 
with other areas of the West with less hydropower and more 
thermal generation. For example, under normal water conditions, 
in 2005 the Northwest would have produced about 520 pounds of 
carbon dioxide for each megawatt hour of electricity generated 
compared to 900 pounds per megawatt hour for the rest of the 
West.
    However, like other areas of the country, the Northwest 
faces the likelihood of rising greenhouse gas emissions, albeit 
at a slower rate than elsewhere. Moderating, slowing and 
eventually reversing this growth is a challenge for the Nation 
as well as for our region.
    It will be difficult, according to our study, to achieve 
carbon-reduction goals with policies that focus only on new 
power plants. To achieve those limits, some exiting coal-fired 
plants in our region will have to be replaced with energy 
conservation and generators that produce little or no carbon 
dioxide.
    Finally, Madam Chair, I want to highlight our energy 
conservation story. In the wisdom of Congress, the Northwest 
Power Act of 1980 treats cost-effective energy conservation as 
the highest-priority resource to meet future regional demand 
for power. Today, 28 years later, the importance of energy 
conservation is greater than ever before.
    Energy conservation is unlike any other electricity 
resource. Conservation requires no fuel, requires no back-up 
resource, produces no emissions and requires no ongoing 
expense. Important in the Northwest, conservation also reduces 
pressure on the hydropower system and therefore increases its 
potential to serve as a backup for renewables, particularly 
wind.
    Since 1980, the Northwest has achieved 3,700 megawatts of 
energy conservation. The accomplishment last year alone was 200 
megawatts, an annual record for our region. Forty percent of 
the growth in electricity demand over the last 28 years has 
been met through conservation.
    That amount, 3,700 megawatts, is equal to the electricity 
demand of Seattle, Portland and Boise combined. It is equal to 
seven large coal-fired plants that did not have to be built, 
13.5 million tons of carbon dioxide that were not emitted into 
the atmosphere, and a savings to consumers of nearly $2 billion 
in 2007 compared to the cost of electricity from the wholesale 
market. The average cost of this conservation was less than 
$0.03 per kilowatt hour. The current cost of wind power is more 
than $0.08 per kilowatt hour.
    Looking to the future, the Council will continue to rely on 
conservation. We have identified more than 3,000 megawatts of 
additional conservation that is also available at a cost of 
less than $0.03 per kilowatt hour.
    That concludes our testimony. Thank you very much.
    [The prepared statement of Ms. Eden follows:]

               Statement of Melinda Eden, Oregon Member, 
                Northwest Power and Conservation Council

    My name is Melinda Eden, and I am one of two Oregon members of the 
Northwest Power and Conservation Council. I serve as Chair of the 
Council's Power Committee, which includes one member from each of the 
four Northwest states represented on the Council. On behalf of the 
Council, thank you for the invitation to present information at this 
hearing on hydropower.
    The Northwest Power and Conservation Council is a regional planning 
agency. It is an interstate compact of the states of Idaho, Oregon, 
Montana, and Washington and was created by the state legislatures in 
1981 under the authority of the Northwest Power Act of 1980. In the 
Power Act, Congress directed the Council to assure the Pacific 
Northwest region an adequate, efficient, economical, and reliable power 
supply while also protecting, mitigating, and enhancing fish and 
wildlife affected by the construction and operation of hydropower dams 
in the Columbia River Basin. As required by the Power Act, the Council 
produces a regional, 20-year Power Plan that guides the future resource 
acquisitions of the Bonneville Power Administration. The Power Plan 
also provides guidance to electric utilities in the region as they 
conduct their own resource planning. By law, the Council revises the 
Power Plan at least every five years. The Council's fish and wildlife 
mitigation is accomplished through the Columbia River Basin Fish and 
Wildlife Program, which by law is part of the Power Plan.
    Through its planning, the Council works to ensure that the regional 
electricity supply remains low-cost and low-risk. It is important to 
protect and enhance the role of hydropower in the power supply by 
improving the efficiency of the region's electricity use, increasing 
the hydropower generation output of existing dams where feasible, 
continuing to mitigate effectively the environmental impacts of 
hydropower, and providing flexibility to support the development of 
renewable resources in the region.
    In my testimony I will briefly discuss the Northwest power system; 
the record-setting gains in energy conservation in the Northwest in 
2007; the future of hydropower in the Northwest; the Council's role in 
mitigating the impacts of hydropower on fish and wildlife of the 
Columbia River Basin; the rapid growth of wind power in our region and 
its impact on hydropower; and the important role hydropower plays--and 
will continue to play--in moderating greenhouse gas emissions from 
power plants that burn fossil fuels.
Pacific Northwest Electricity
    Twenty-eight years of investment in conservation, along with a 
rapidly growing supply of wind power and our continuing reliance on 
hydropower, make the Pacific Northwest electricity supply among the 
cleanest and most efficient in the nation. The cornerstone of the 
Pacific Northwest electricity system is energy created by falling 
water--hydropower. Hydropower provides 61 percent of the region's 
electricity generating capacity. Most of the remainder is provided by 
power plants that burn natural gas or coal. Natural gas provides about 
16 percent, and coal about 13 percent of the total capacity. There is 
one nuclear power plant in the region; it provides about 2 percent of 
the region's electricity. With normal precipitation, hydroelectric dams 
in the Pacific Northwest provide about 15,500 average megawatts of 
electricity, or about 75 percent of all the electricity used in the 
Northwest.
    The amount of power provided by non-hydropower forms of renewable 
energy, particularly wind power, is small but growing. Biomass power 
plants provide less than 2 percent, geothermal and solar together 
provide less than 1 percent, but wind power provides 4.7 percent. As 
the result of renewable resource requirements in three of the Northwest 
states, development of wind and other renewable power will increase. In 
fact, it is increasing rapidly already. Since 2000, wind power 
development has increased by 3,463 megawatts in the region. In 
contrast, non-renewable natural gas-fired capacity has increased even 
more, however: by 5,403 megawatts during the same time period.
    In the Northwest, hydropower is generated at both federal and non-
federal dams. Most of the region's hydropower is generated at dams on 
the Columbia River and its tributaries. While there are both federal 
and non-federal dams in the Columbia River Basin, by far the largest 
portion of the hydropower supply is generated at federal dams. The 
Federal Columbia River Power System comprises 31 dams and one non-
federal nuclear power plant. With normal precipitation, the energy 
produced by dams of the Federal Columbia River Power System is 9,098 
average megawatts. Columbia River dams in the United States are 
operated in coordination with dams on the Columbia River and its 
tributaries in British Columbia under the Columbia River Treaty of 
1964. This coordinated, international power supply is a model of 
binational cooperation that other countries with transboundary rivers 
have sought to emulate.
    In short, the Pacific Northwest is hydropower country. The region 
has a long history of hydropower development. The first dams generated 
electricity on Columbia River tributaries in the late 1880s, just a 
decade after Thomas Edison invented the light bulb. The first dam 
across the mainstem of the Columbia River was completed in 1933. This 
dam, Rock Island, was built by a privately owned utility. Federal 
construction projects began that year at Bonneville and Grand Coulee 
dams. Bonneville was completed in 1938 and Grand Coulee in 1941. The 
last of the federal dams were completed in the 1970s.
    Electricity generated at the federal dams in the Columbia River 
Basin is sold by the Bonneville Power Administration, a federal power-
marketing agency. The electricity is sold for the cost of its 
generation. Over time, that cost has increased as additional components 
have been added--for example, costs associated with Bonneville's share 
of the region's debt for financing nuclear power and the cost of 
mitigating the impacts of hydropower on fish and wildlife.
    Importantly, the Federal Columbia River Power System is almost 
entirely self-financing. Costs associated with the dams are paid by 
those who use them. For example, customers of hydropower pay for the 
hydropower facilities through the rates charged for the electricity.
Energy Conservation: The Highest-Priority Resource in the Northwest
    While hydropower is the most important generating resource in the 
Northwest, the Northwest Power Act of 1980 treats cost-effective energy 
conservation as a resource equivalent to power generation and the 
highest-priority resource to meet future regional demand for power. 
Energy conservation means reducing demand for electricity by improving 
the efficiency of electricity use. Conservation is not only the most 
important future electricity resource for the Northwest, it is the most 
cost-effective as well.
    In focusing on energy conservation 28 years ago, Congress was quite 
far-sighted. Today, with gasoline prices hovering around $4 per gallon 
and with increasing public concern about greenhouse-gas emissions, 
global climate change, and the monetary and environmental cost of 
energy, the importance of energy-use efficiency is greater than ever 
before. Energy conservation is unlike any other electricity resource. 
There is no fuel, and therefore no ongoing fuel costs or associated 
risk of volatile prices. Conservation requires no backup resource to 
shape its output to meet demand. Conservation is not a fuel we import 
from a foreign country so there is no risk of supply shortages or 
curtailments. There are no emissions, and therefore no risks to the 
climate. There is no ongoing cost after the resource is installed--
except, for example, when a compact fluorescent light bulb burns out 
and needs to be replaced. Importantly in the Northwest, by reducing 
demand for power, conservation reduces pressure on the hydropower 
supply and therefore increases its potential to serve as a backup for 
renewable energy, particularly wind power.
    Western states are national leaders in energy conservation as the 
result of impressive efficiency improvements in California and the 
Northwest states. In the Northwest since 1980, demand for electricity 
has been reduced by 3,700 megawatts. Fifty-one percent of that amount--
1,913 megawatts--has been achieved since 2000.
    These efficiencies resulted from multiple sources including new 
building codes, the effects of national energy efficiency standards, 
and programs and incentives offered by states, the Bonneville Power 
Administration and the region's public and investor-owned utilities. 
The average cost of this conservation was less than 3 cents per 
kilowatt-hour. The current cost of wind power, by comparison, is more 
than 8 cents per kilowatt-hour.
    Expressed as electricity generation, 3,700 megawatts is enough 
power to supply the entire state of Idaho and all of western Montana, 
with 400 megawatts left over. Put another way, 3,700 megawatts is the 
equivalent of seven, 500-megawatt coal-fired power plants that did not 
have to be built; 13.5 million tons of carbon dioxide that were not 
emitted into the atmosphere; and a savings to consumers, compared to 
the cost of electricity from the wholesale market, of nearly $2 billion 
per year in 2007.
    The Council is pleased to report that in 2007 the Northwest set a 
one-year record for energy conservation, an achievement of 200 
megawatts. The largest share of this savings was in the residential 
sector, and the largest contribution to that savings--60 percent of the 
residential savings--was compact fluorescent light bulbs. Between 18.5 
million and 19 million bulbs were sold in the Northwest last year--more 
than any other region of the United States in terms of bulbs per 
person. Looking to the future, the Council has identified more than 
3,000 additional megawatts of conservation that is available, also at a 
cost of less than 3 cents per kilowatt-hour.
Future Hydropower Development in the Pacific Northwest
    With more than 360 hydroelectric dams in the Pacific Northwest, 
hydropower is by far the most important generating resource in the 
region. However, hydropower is not the most important source of meeting 
future demand for power. That is because most of the economically and 
environmentally feasible sites for hydropower generation have been 
developed. The remaining opportunities, though numerous, are for the 
most part small-scale and relatively expensive.
Hydropower and Fish and Wildlife in the Columbia River Basin
    Upgrades at existing dams could improve survival of migrating fish. 
Examples are installation of fish-friendly turbines and screens to 
guide fish away from the turbine entrances. This is not to suggest that 
such upgrades would render hydropower dams completely benign in terms 
of environmental impacts. Spill reduces power generation at dams on the 
Columbia and Snake rivers by about 1,200 megawatts to help juvenile 
salmon and steelhead migrate to the Pacific Ocean. Water is directed 
over spillways instead of through turbines. In the Power Act, Congress 
recognized that hydropower dams have impacts on fish and wildlife. One 
of the Council's three principal responsibilities, in addition to power 
planning and public information, is to protect, mitigate, and enhance 
fish and wildlife, and related spawning grounds and habitat, that have 
been affected by the construction and operation of hydropower dams in 
the Columbia River Basin. We fulfill this mandate through the 
development and implementation of the Columbia River Basin Fish and 
Wildlife Program.
    The program provides protection for fish and wildlife from the 
effects of future hydropower development as well as from existing 
projects. Beginning in 1989, the Council included in the fish and 
wildlife program a set of standards for the Federal Energy Regulatory 
Commission (FERC) and others to apply to the development and licensing 
of hydroelectric facilities in the Columbia River Basin. FERC is one of 
the federal agencies that is required to take the Council's fish and 
wildlife program into account in its decision-making. The standards 
include designating certain river reaches in the basin as ``protected 
areas,'' where the Council believes that hydroelectric development 
would create unacceptable risks of loss to fish and wildlife species of 
concern, their productive capacity, or their habitat.
New Renewable Resources in the Northwest
    Wind power is proliferating rapidly in the Northwest. This has 
important implications for hydropower. One challenge we face is to 
integrate wind power, which is intermittent depending on the strength 
of the wind, into the power supply where stability is critical. To 
address this issue and others related to wind power, the Council and 
the Bonneville Power Administration convened a task force to study wind 
integration. An important conclusion of this wind-integration analysis 
has implications for the region's hydropower supply. According to the 
analysis, there are no technical barriers to integrating up to 6,000 
megawatts of new wind-power capacity into the regional power supply 
(new transmission lines would be required after the first 3,000 
megawatts). Six thousand megawatts is the amount of new wind power 
development envisioned for the 2004-2024 period in the Council's Fifth 
Power Plan. However, the cost of this wind power will depend on the 
flexibility of the hydropower system to provide backup generation at 
times when wind-power output declines.
    When wind energy is added to a utility system, its natural 
variability and uncertainty is combined with the natural variability 
and uncertainty of loads. During times of very hot or very cold 
temperatures, the wind often does not blow. As a result, there is an 
increase in the need for hydropower flexibility required to maintain 
utility-system balance and reliability. According to the analysis, the 
cost of wind integration starts low, particularly when integrating with 
a hydropower system that has substantial flexibility, and then rises as 
increasing amounts of wind are added. Siting wind turbines in 
geographically diverse areas can help reduce costs. Ultimately, costs 
plateau at the cost of integrating wind with natural gas-fired power 
plants.
    With increasing amounts of wind power in the regional power supply, 
there likely will be times when large, unexpected increases in wind 
output coincide with periods of limited hydropower flexibility. If 
other sources of flexibility are not available at the same time, system 
operators may need to limit wind output for brief periods in order to 
maintain reliability.
Moderating the Carbon Dioxide ``Footprint'' of the Northwest Power 
        Supply
    As the title of this hearing asserts, hydropower is clean and 
renewable. Hydropower in the mix of electricity-generating resources 
reduces the amount of electricity produced by power plants that burn 
fossil fuels, and therefore the amount of carbon dioxide and other 
greenhouse gasses released into the atmosphere from those plants. In 
November 2007, the Council reported the results of a year-long study of 
carbon dioxide emissions from the Northwest power plants.
    The results demonstrated the moderating effect of the region's 
large hydropower base on carbon dioxide emissions from the power 
supply, compared to other areas of the West with less hydropower and 
more thermal generation. For example, under normal water conditions, in 
2005 the Pacific Northwest would have produced about 520 pounds of 
carbon dioxide for each megawatt-hour of electricity generated, 
compared to 900 pounds for the entire western interconnected power 
system.
    However, like other areas of the country, the Northwest faces the 
likelihood of increasing greenhouse gas emissions--albeit at a slower 
rate than elsewhere. Moderating, slowing, and eventually reversing this 
growth is a challenge for our nation as well as for our region. Carbon 
dioxide emissions in the Northwest, thanks to hydropower, are already 
comparatively low. Forcing them to go lower will be a challenge for the 
Northwest. We face this challenge because the Northwest has essentially 
the same set of future electricity-generating options as the rest of 
the country. Unlike other regions of the country, however, the 
Northwest has the Council's Northwest Power Plan to guide future 
resource development. The plan follows the resource priorities in the 
Power Act. The priorities are: first, cost-effective energy efficiency 
(conservation); second, cost-effective renewable energy; third, high-
efficiency thermal generation; and fourth, traditional thermal 
generation.
    The base case of our analysis of carbon dioxide emissions from the 
Northwest power supply assumed implementation of the resource 
recommendations in the Fifth Power Plan, which includes aggressive 
development of energy conservation and renewable resources, 
particularly wind power (the Fifth Power Plan was completed in 2004; 
the Council is working on the Sixth Power Plan now and plans to finish 
it in mid-2009). According to the study, carbon dioxide emissions in 
the Western Electricity Coordinating Council (WECC) area increase about 
3 percent to about 920 pounds per megawatt-hour by 2024, whereas the 
Northwest rate, with aggressive development of energy efficiency and 
renewable energy, also increases 3 percent to about 530 pounds. The 
future growth rate of annual regional carbon dioxide production would 
be even higher if the conservation, wind power, and other renewable 
resource development called for in the Council's Fifth Power Plan were 
not accomplished. With implementation of the Council's plan in the base 
case, the annual carbon-dioxide production of the regional power system 
in 2024 under normal conditions would be about 67 million tons, an 18-
percent increase over normal 2005 levels.
Carbon-Reduction Policy Focus
    An important finding of the carbon dioxide analysis is that it will 
be difficult to achieve goals for carbon-dioxide emissions with 
policies that focus only on new power plants. If the energy efficiency 
targets of the Council's Fifth Power Plan were achieved and renewable 
energy portfolio standards were successfully implemented by all 
Northwest states, projected power-system carbon-dioxide emissions in 
2024 would exceed normalized 2005 levels by more than 10 percent, and 
actual 1990 levels by more than 40 percent. Put another way, meeting 
the aggressive energy efficiency and renewable portfolio standards 
would slow, but not eliminate, growth of carbon-dioxide emissions. Even 
worse, if the region fails to meet the conservation targets in the 
Council's Fifth Power Plan, or if hydropower generation is reduced from 
current levels and the power replaced with new thermal generation, the 
effect would be a net gain in carbon-dioxide emissions over time.
    Overall, the effects of the various scenarios addressed in the 
analysis, all of which are consistent with current policies that 
address future, and not existing, thermal power plants, yield a 
reduction of carbon-dioxide emissions equal to the output of one or two 
coal-fired power plants. In the Fifth Power Plan, the Council's 
forecast for regional carbon-dioxide production by the power system in 
2024 exceeds 1990 levels by an amount equivalent to eight coal-fired 
plants. These results illustrate the difficulty of reducing carbon 
dioxide production with policies that affect only new sources of 
electricity generation. Existing coal-fired power plants dominate 
carbon-dioxide production from electricity generation. These plants 
provide about 23 percent of the region's electricity but 85 percent of 
the carbon-dioxide emissions from the regional power system. To 
stabilize carbon-dioxide emissions at 2005 levels or to reduce 
emissions to 1990 levels would require replacing the output of some of 
these existing coal-fired plants with additional energy conservation 
and other resources that produce little or no carbon dioxide. In 
addition, the analysis shows that policy choices made for purposes 
other than carbon-dioxide reduction, such reducing hydropower 
generation to improve environmental conditions for migratory fish, also 
can have significant adverse effects on carbon-dioxide production. In 
fact, the effect could be great enough to negate the carbon-reduction 
goals of state renewable portfolio standards.
    Thank you again for the opportunity to testify at this hearing. 
Through the Council's planning processes for future power supplies and 
fish and wildlife protection, we are working to ensure that our 
region's hydropower-dominated electricity supply remains clean, 
reliable, and affordable.
                                 ______
                                 
    Mrs. McMorris Rodgers. Very good. Everyone is being quite 
timely here. Thank you.
    Let's see. Next is Mr. English.

 STATEMENT OF THE HON. GLENN ENGLISH, CHIEF EXECUTIVE OFFICER, 
 NATIONAL RURAL ELECTRIC COOPERATIVE ASSOCIATION, ARLINGTON, VA

    Mr. English. Thank you very much, Madam Chair. I appreciate 
that. Let me just say I am delighted to be here. Thank you for 
the opportunity of testifying on behalf of the electric 
cooperatives across this country.
    I will bring you a little different perspective and perhaps 
an appreciation of just how important hydro is going to be for 
the future.
    I think we all recognize and understand that we are likely 
to see climate change legislation pass in the not-too-distant 
future. Given the position of the two political nominees of 
major parties, it is very likely we are going to see climate 
change law in the not-too-distant future.
    What is not recognized, I don't think, and received nearly 
as much attention is the fact that the generation capacity in 
this country is pretty much exhausted. We built excess capacity 
back in the late 1970s, early 1980s. That is pretty much gone. 
And given what the Energy Information Agency has projected for 
the year 2030, we are told we are going to have about a 30 
percent increase in demand over and above what we have today, 
some 264 gigawatts of power.
    And the real question that we have facing us is obviously a 
time in which additional generation needs to be built, and that 
has to be balanced with what climate change legislation may 
pass the Congress.
    And, in the next decade, that could be a very serious 
pinch. The reason that I say that is due to the fact that 
already we are seeing a chilling effect of the use of the 
primary fuel that we have, as far as generation in this 
country, and that is coal-fired generation. Nationwide, it is 
roughly half of all the generation is coal-fired. And we are 
seeing those plants that were on the drawing boards are now 
being shifted into primarily natural gas.
    That is obviously going to have a serious impact as to the 
ability of the country to be able to meet the demand needs. 
That means we have to have a lot of production out of 
efficiency and a lot out of renewables.
    I am very proud to say that I am one of the steering 
committee members for the national organization of ``25 x 
'25,'' which has as its national objective 25 percent of our 
energy produced by the year 2025. I am also very pleased to say 
that that organization fully recognizes that hydro is a 
renewable and must play a very important role as far as the mix 
for the future.
    The fact of the matter is, Madam Chair, up to this point, 
whether you talk about Democratic or Republican 
administrations, I am not sure that we have seen the proper 
respect and appreciation for the contribution that is made by 
hydro in this country, and certainly what is going to be 
necessary for the future.
    The bottom line is, if, in fact, we are going to keep the 
lights on in this country, we are going to need the full 
productive capacity of hydro in this Nation. And that means 
that we have to have upgrades and improvements in the existing 
facilities and any additional contributions that can be made. 
And that, I think, is a very important role indeed.
    As we look at the fact that both the Corps of Engineers and 
the Bureau of Reclamation today practice a breakdown 
maintenance approach, which seriously impairs the capacity to 
generate the full capacity of our hydro plants, that is 
obviously a policy that needs to be changed and changed very 
rapidly.
    I would suggest that any time we have a breakdown, any time 
we have a generator shutdown, what it means is that particular 
entity, in order to acquire power, must in fact buy on the open 
market. And, most likely, the power that must be purchased is 
going to be power that is adding to the climate challenge, 
making it more difficult for us to obtain any gains that the 
Congress and the new President may lay down to us.
    So I think it is extremely important for us to look ahead. 
It is my understanding that we have a Government report now 
underscoring the fact that 2,500 megawatts, or approximately 
the output of four coal-based power plants, could be displaced 
through the rehabilitation and additional development of the 
hydroelectric resources. That is something that the country 
desperately needs, and we need that contribution.
    So, at the present time, I know many of our members, who 
are a part of the Federal preference customer group, are 
providing funding and rehabilitation on their own. They are 
taking money out of their own pocket and making the 
contribution to make these rehabilitations. The Western States, 
in WAPA, their footprint, they funded almost $50 million in 
rehabilitation needs, but they can't do it all alone.
    So what we need is, obviously, for the Congress and the new 
administration to recognize the importance of hydro, the 
importance it has to play in meeting any climate change goals, 
the importance that it is going to play in the future in 
meeting this additional demand need, and certainly the 
importance in trying to keep electric bills down in this 
Nation.
    So, Madam Chair, I want to applaud the fact that you are 
having this hearing, applaud the fact that you recognize the 
importance of hydro. And I hope that you are able to spread to 
your colleagues the very important role that hydro will have to 
play if this country indeed is going to keep the lights on and 
meet its needs.
    Thank you very much.
    [The prepared statement of Mr. English follows:]

           Statement of The Honorable Glenn English, C.E.O., 
            National Rural Electric Cooperative Association

    Chairwoman Napolitano, Ranking Member McMorris Rodgers, and Members 
of the Subcommittee:
    My name is Glenn English, and I am the Chief Executive Officer of 
the National Rural Electric Cooperative Association (NRECA). I 
appreciate the invitation to appear before you today to discuss 
hydropower issues. NRECA is a trade association consisting of nearly 
1,000 cooperatives providing electricity to 41 million consumers in 47 
states. As member-owned, not-for-profit organizations, cooperatives 
have an obligation to provide a reliable supply of electricity to all 
consumers in our service areas at the lowest possible price. We take 
our obligation to serve very seriously--the personal and economic 
health of our members, our communities, and our nation depends on it. 
Cooperatives serve primarily the more sparsely populated parts of our 
nation but cover roughly 75 percent of the nation's land mass.
    In the early stages of this nation's hydropower program, electric 
cooperatives agreed to a partnership with the federal government. 
Electric cooperatives agreed to pay what were then significantly higher 
costs for power in exchange for a guarantee of a secure, reliable cost-
based power resource. This partnership provided the basic structure for 
real competition between consumer-owned and large investor-owned 
utilities. Today the federal hydropower program remains a very 
important source of power for more than 600 electric cooperatives. In 
total, 50 million people nationwide share the benefits of the federal 
hydropower program. The Energy Information Agency (EIA) reports that 
hydropower accounts for nearly 75 percent of the country's renewable 
energy supply, while meeting seven percent of consumers' total energy 
needs.
    To fully appreciate the future role of hydropower--and its 
importance--I believe the Subcommittee should know the energy challenge 
facing this nation and how electric cooperatives are reacting to this 
challenge. Frankly, I believe that Congress is focused on one half of 
the looming challenge--but the other half is critical though it has not 
received the same spotlight as global climate change. This is the 
fundamental question of whether the nation will have enough electricity 
capacity to meet consumer energy needs.
    EIA has projected that electricity demand will grow 30 percent by 
2030, requiring 264 gigawatts of electricity. To better understand the 
magnitude of this challenge, consider that 264 gigawatts is 2.5 times 
the power now generated in the state of Texas. The more critical and 
immediate problem will come in the next ten years. Members of the 
Subcommittee are well aware of the opposition to building new coal-
fired generation, as well as the massive undertaking needed to enlarge 
our fleet of nuclear power plants. Even taking increased energy 
efficiency into account, the nation will still need 118 gigawatts of 
new generating capacity by 2020. Natural gas will clearly play a 
crucial role, but we will need every source of electric power 
generation at our disposal. We simply cannot wait. In some regions, 
demand will soon outstrip capacity unless generation and transmission 
are added, leading Richard Sergel, CEO of the North American Electric 
Reliability Corporation, to state: ``We're close to the edge...We need 
action in the next year or two to start on the path to having enough 
electricity 10 years from now.'' I have attached a map to my testimony 
showing the near-term dates when many regions will face an electricity 
capacity shortfall.
    Among electric cooperative consumers, demand growth is projected at 
about double the national average. Electric cooperatives take seriously 
our responsibility to meet our consumers' electricity needs, while also 
taking a leadership role in the development of renewable energy. More 
than ever before, renewable hydropower must be part of the diverse mix 
of fuels to meet our consumers' needs.
    As a member of the steering committee of the 25x25 Ag Energy 
Working Group, NRECA worked with Congress to include the goals of the 
25x25 action plan in the Energy Independence and Security Act of 2007. 
1 The action plan calls for the United States to produce 25 
percent of its electricity from renewable energy sources by 2025. 
During the Working Group process, I argued that hydropower must be 
included in the definition of a renewable. I was pleased that language 
in the 25x25 action plan recommended that ``America must rapidly 
increase centralized and decentralized renewable electricity 
generation, taking advantage of biomass, geothermal, hydropower, 
landfill gas, biogas from animal operations and other organic waste, 
solar, and wind, as well as thermal uses.'' This type of recognition of 
hydropower as a renewable is long overdue.
---------------------------------------------------------------------------
    \1\ Sec. 806 of the Energy Independence and Security Act of 2007. 
25 x 25 Action Plan. http://www.25x25.org/storage/25x25/documents/
IP%20Documents/Action_Plan/actionplan_64pg_11-11-07.pdf
---------------------------------------------------------------------------
    It's important to note that electric cooperatives continue to 
develop their own sources of renewable energy through aggressive use of 
the Clean Renewable Energy Bond (CREBS) program included in the Energy 
Policy Act of 2005. So far, 40 electric cooperatives have developed or 
are developing $430 million worth of renewable energy projects using 
this program. This project portfolio includes $60 million for new 
incremental hydropower projects.
    In addition, cooperatives across the country recently formed the 
National Renewables Cooperative Organization (NRCO) to accelerate the 
development and deployment of renewable energy resources. Since it has 
become increasingly difficult to build new baseload generation, 
electric cooperatives recognized we must produce as much power as is 
technologically and economically possible from renewable sources. 
Formed in March of 2008, NRCO already has 24 member co-ops who 
collectively serve 23 million Americans in 36 states. NRCO reflects the 
commitment of cooperatives around the country to the responsible 
development of cost effective renewable resources in a manner that 
benefits their consumers, their communities, and the nation as a whole. 
The NRCO will allow cooperatives to pool expertise in developing 
renewable energy, share access to sites that are conducive to renewable 
production, and potentially lower the high capital costs of these 
projects.
    The NRCO and CREBS will help stimulate development of renewable 
resources in the future. In the meantime, the federal government is 
overlooking its largest and most long-standing renewable resource: 
hydropower.
    For more than 100 years, the federal government has developed 
hydropower capabilities at the multi-purpose projects of the Bureau of 
Reclamation (Bureau) and U.S. Army Corps of Engineers (Corps) across 
the country. These projects serve a variety of needs (flood control, 
irrigation, municipal and industrial water, and recreation) and play an 
important role in local, regional and national economic development. 
Preference customers purchasing this power are repaying the federal 
government's hydropower investment. There is no subsidy.
    The multi-purpose projects of the Corps and Bureau generate enough 
emission-free hydropower each year to displace 85.5 million metric tons 
of CO2. The Subcommittee may be interested in the positive 
environmental role each of the four Power Marketing Administrations 
play in the displacement of CO2.
    The Bonneville Power Administration (BPA) generates 72,307 
gigawatt-hours of hydropower, annually displacing 56.2 million metric 
tons of CO2. One of the federal dams in BPA's footprint, the Grand 
Coulee Dam, with which the Ranking Member is very familiar, has the 
potential to produce almost 7 gigawatts of electricity. That's enough 
power to displace the emissions of more than 10 coal-fired power 
plants.
    The federal hydropower marketed by the Southwestern Power 
Administration produces an average of 5,570 gigawatt-hours of clean 
renewable hydropower annually. This energy production reduces emissions 
of carbon dioxide by 4.6 million tons per year. 2 Projects 
in the Southeastern Power Administration (Southeastern) play a similar 
role in mitigating carbon emissions. Southeastern's generation of 5,232 
gigawatt-hours in Fiscal Year 2007 offset carbon dioxide emissions by 
4.4 million metric tons. 3 In the Western Area Power 
Administration, 26,159 gigawatt-hours in Fiscal Year 2007 offset the 
equivalent of 20.3 million metric tons of CO2.
---------------------------------------------------------------------------
    \2\ Testimony of Jon Worthington, Administrator Southwestern Power 
Administration, before the House Subcommittee on Water and Power, 
February 26, 2008
    \3\ Testimony of Leon Jourolmon, Acting Administrator Southeastern 
Power Administration, before the House Subcommittee on Water and Power, 
February 26, 2008.
---------------------------------------------------------------------------
    Unfortunately, the hydropower capabilities at federal dams have 
been compromised by years of insufficient funding, even though federal 
hydropower investment is repaid with interest to the U.S. Treasury.
    Starting in the late 1970s and continuing to present day, the 
hydropower facilities at these multi-purpose projects have not been 
adequately maintained or kept up-to-date. By abandoning its stewardship 
of this important national resource, the federal government has 
compromised the reliability of federal hydropower generation at a time 
when renewable energy resources are increasingly important in the 
effort to reduce carbon emissions as well as meet growing electricity 
demand.
    Let us heed the words of Chairman Peter Visclosky in the FY 2008 
House Energy and Water Appropriations Committee report:
        ``Energy security and issues of global climate change are 
        increasingly important to the decisions made regarding 
        infrastructure investment. Hydropower improvements at existing 
        facilities provide a reliable, efficient, domestic, emission-
        free resource that is renewable.'' 4
---------------------------------------------------------------------------
    \4\ House Energy and Water Appropriations Committee Report FY 2008.
---------------------------------------------------------------------------
    Unfortunately, the Corps and Bureau have practiced ``break-down'' 
maintenance--only fixing or replacing units when they break instead of 
performing routine maintenance to keep federal hydropower projects 
running at their most efficient capacity. Fortunately, a blueprint now 
exists to address this problem.
    A little-known section included at the end of the Energy Policy Act 
of 2005 mandated that the Bureau of Reclamation and the Corps of 
Engineers inventory the amount of additional hydropower possible 
through the rehabilitation of existing federal dams and additional 
development at these facilities.
    The report found 64 sites warranting ``...further exploration for 
additional hydropower development,'' 5potentially resulting 
in the addition of 1,230 MW. By rehabilitating existing hydroelectric 
facilities, an additional 1,283 MW of emission-free hydropower could be 
produced. In total, 2,500 MW or the approximate output of four sizable 
coal-based power plants could be displaced through the addition and 
rehabilitation of these hydroelectric resources.
---------------------------------------------------------------------------
    \5\ Potential Hydroelectric Development at Existing Federal 
Facilities, U.S. Departments of the Interior, Army and Energy, May 
2007.
---------------------------------------------------------------------------
    Let me be clear. This is not a Republican or Democratic issue. 
Successive administrations--under the direction of the Office of 
Management and Budget--have failed to put sufficient resources into the 
power function of these facilities, allowing many parts of the federal 
power system to fall into disrepair. When hydropower units are down, 
preference customers are forced to buy power from the open market, 
which is frequently fossil-based and more costly.
    Wolf Creek Dam in Kentucky epitomizes this problem. In 2006, the 
Corps of Engineers implemented emergency measures to prevent a 
catastrophic failure of this dam. Due to the lowering of the reservoir 
behind the dam, approximately 312 megawatts of hydropower generation 
has been lost.
    Wolf Creek is but one example of a system that is failing to 
operate efficiently. The problem runs rife through the Federal Power 
System. In the Southwestern Power Administration service territory, ten 
percent of the units generating hydropower are out of service because 
they need to be fixed or outright replaced. This total outage amounts 
to 132 Megawatts.
    The problem was compounded this spring when several dams could not 
take advantage of above average rainfalls in Missouri and Arkansas. In 
one instance, the Truman Dam in Missouri was unable to realize its true 
hydropower potential due to a transformer failure. This failure 
precluded three of its six generators from operating during this unique 
opportunity to generate excess hydropower.
    In many cases, preference customers have stepped in to provide 
funding for the rehabilitation of these facilities. A group of Western 
Area Power Administration customers known as the Western States Power 
Corporation has funded projects rehabilitating hydroelectric facilities 
of the Corps and Bureau to the sum of $45.8 million. Unfortunately, 
Western States members simply cannot advance fund all of the federal 
hydropower program's repair needs while at the same time maintaining 
their own generation infrastructure and developing new sources of 
renewable and conventional generation. It must be a federal priority 
and a continuation of the federal hydropower commitment to consumers.
    Some have called for the breaching of our federal dams. This would 
be completely counter to the long-standing federal hydropower 
commitment and policy. This is not the time to create additional energy 
challenges for this country. Nor is it time to adopt misguided 
proposals initiated by OMB that seek to change the repayment terms of 
the PMAs. We must invest in our federal hydropower infrastructure and 
reverse the ``break-down'' maintenance practice that has put the 
federal hydroelectric infrastructure in such a dire state of disrepair.
    NRECA urges Congress and future Administrations--Republican or 
Democrat--to take all steps necessary to maximize the reliability and 
efficiency of the existing federal hydropower assets and to identify 
and pursue all opportunities to expand these facilities. These assets 
are an essential part of the national strategy for addressing global 
climate change and ensuring that consumers have enough electricity.
    Thank you for the opportunity to testify. I will be happy to answer 
any questions you might have.

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                                 ___
                                 
    Mrs. McMorris Rodgers. Thank you.
    And excellent testimony by everyone. Again, appreciate you 
being here.
    I would like to just ask a question that each panelist can 
answer, and it does relate to electricity demand. And as we 
think about the next 20 years, there is a lot of differing 
opinions as to how we are going to meet electricity demand in 
this country. And some think that new generation isn't 
necessary, that we can meet the demand through conservation, 
efficiency.
    I would just like to hear from you your perspective on the 
need for new generation and if you believe there is an 
opportunity for expanded hydropower generation.
    Mr. Morton. I take it you are looking at me to start off 
with that.
    Mrs. McMorris Rodgers. Well, if you would like.
    Mr. Morton. Again, thank you for allowing us to also share 
in the questions and answers.
    The most exciting thing I see for the future--and I don't 
think there is any argument but that we need more power when we 
increase our industrial output, we increase our population.
    The most exciting thing that we have seen so far is the, I 
am going to call it, RITE Project in the East River of New York 
City. So here we are way out in the other corner of the United 
States looking at it. The Public Utility District of Okanogan 
has looked seriously at this as a project that may be able to 
be included in the Columbia River itself.
    The RITE Project in New York--and I have addendums on it 
somewhere in your literature there--is placing turbines beneath 
the surface of a flowing stream of water. In our case, we are 
looking seriously at the Columbia River as a possibility for 
putting these many fixtures in that would generate power.
    So we see that as a strong possibility the committee might 
want to consider and get more information on.
    Mrs. McMorris Rodgers. Anyone else?
    Mr. Gruenspecht. In our outlook to 2030, we do see growth 
in electricity demand, certainly much less than in the past. 
When I was a kid, electricity demand was increasing 6, 7, 8 
percent a year, so electricity demand would double every 10 
years. Now we are looking at growth, much lower rate, maybe 1.1 
percent in our base case. But over time, as has been discussed, 
that does add up. After 2030, you are looking at something like 
close to 30 percent.
    As was discussed earlier, we have been relying on existing 
capacity, for base load in particular, that was built. We 
haven't built much new coal, much new nuclear. We have built a 
lot of gas recently, although running those gas plants is very 
expensive. So, over time, the capacity factors on our existing 
nuclear and our existing coal plants have gone up. And it is 
not very attractive because of climate change to build more 
coal plants, if we are really going to be serious about 
reducing greenhouse gas emissions.
    So there is need for base load generation of some sort. 
Conventional hydro, you know, we think there are opportunities 
for improvements in addition to the existing sites. History 
suggests that new sites may be quite difficult.
    But, as discussed by several of the witnesses, some of 
these new technologies, frankly, like the hydro kinetic 
technologies, could matter. That includes both instream power; 
it could also include the wave power, which is grouped into 
that. But it is early days for those, and we don't really 
include those in our base yet. But there may be an opportunity 
there.
    Thank you.
    Mrs. McMorris Rodgers. Thank you.
    Mr. English. Madam Chair, I would suggest this. Common 
sense tells you that we are going to have to have more 
generation if you are going to eliminate the primary fuel that 
we have had in this country for most of the last century, 
namely coal. And that is basically what we are going to do with 
climate change legislation until we have the technology for 
carbon capture and storage. And it is anticipated that that 
technology will not be available until well after 2020. So for 
the next decade or so, we are going to primarily be shifting to 
natural gas.
    And, obviously, we are going to need all the help that we 
can get out of efficiency, we are going to need everything we 
can get out of renewables, and we are going to have to have a 
real stretch here to be able to meet the power needs of this 
country and take care of the demand that EIA has forecasted. 
That is 118 gigawatts here in the next 10 years of demand that 
has to be consumed in some way, dealt with in some way.
    To give you some idea of the magnitude of what we are 
talking about, in the next 20 years, we are talking about 
roughly two and a half times the amount of power that is 
produced in the State of Texas, about four times what is 
produced in California. So it is a tremendous amount of power 
that has to be acquired in some fashion, either reducing the 
demand, increasing existing capacity capabilities, and 
certainly renewables. And hydro can play a major role in that.
    But I think it underscores once again that if we are going 
to do this and do it with an ambitious schedule on meeting 
climate change objectives, then obviously we have to maximize 
what we can get out of hydro. And I think that is the lesson 
and certainly the message that needs to be taken to colleagues 
in the Congress, as well as to the new President and new 
administration.
    Mrs. McMorris Rodgers. OK.
    Go ahead, Ms. Eden.
    Ms. Eden. Thank you, Madam Chair.
    I agree with the numbers for load growth that are predicted 
by the gentlemen on either side of me.
    The Power Council does a power plan every 5 years, and a 
new one is due out next year. The statute requires us to use 
cost-effective conservation first in the Northwest and then 
renewables, and then, as every other part of the country, we 
have built quite a bit of gas in the meantime.
    We will be looking at all of the possibilities, including 
demand response and possibly hydro projects that have not yet 
been built.
    Our fifth power plan, which came out in 2004, encouraged 
the upgrading of existing hydro projects, because there is a 
good deal of electricity that can be generated by investing the 
money necessary to upgrade those projects. Our last plan did 
not encourage the development of new hydro, at least in the 
Northwest, because it was determined that all of the sites were 
small, the potentials were small, and the cost was tremendous.
    Ms. Eden. So they weren't deemed to be economically 
feasible. As we do every 5 years, we will be looking at that 
question again.
    Mrs. McMorris Rodgers. Very good. Thank you. Madam 
Chairwoman.
    Mrs. Napolitano. Thank you, ma'am. I would like to ask to 
all panelists that some of the testimony focuses on the 
potential for new hydropower. And I know we have discussed it. 
And you have mentioned it may not be feasible in some areas. 
Developing a new--from different sources, do you think the 
House passed measure H.R. 6049 that includes a provision making 
some hydropower projects eligible for the production, tax 
credit and clean and renewable energy bond will incentivize new 
hydropower production if enacted? And is it enough to be able 
to entice or be able to enthuse people to get into the business 
of production? Yes, Mr. English.
    Mr. English. Clean renewable energy bonds is certainly a 
part of the renewable effort electrical operatives have 
underway. And we have some $60 million that we are applying 
along those lines with regard to the incremental hydro. So yes, 
the more we can get, the more we can engage and produce. And we 
think that that is very necessary. Could I add one additional 
point, Madam Chair, that there is something that I--also that I 
think people need to understand. Hydro is obviously the 
cheapest power we have in this country, and it makes more of a 
contribution to help keep electric bills down than anything 
else.
    And these days, it is extremely important given energy 
prices. The point that I would make is that we are 
anticipating, because of the shortage and because of having a 
shift in natural gas, that we are likely to see electric bills 
within this decade triple and maybe even more. And so hydro can 
play a major role in dampening that and helping to hold that 
down. So you know, even these small projects, they may not be 
cost effective now, but as those electric bills go up, they are 
going to become more cost effective and become more important 
as we try to hold down electric bills.
    We project--and I will lay this out--we project that we 
will have a major shift as far as the realities of this country 
is facing. Up to this point it has been a national policy since 
the 1930s and the creation of the REA that electric power is 
affordable. We do not think that all of our citizens are going 
to be able to afford electric power in the not too distant 
future. It will be a shift that has been a result of national 
policy.
    Mrs. Napolitano. Thank you for your comments. That is 
something to look at. And back in the 1980s, when I was on city 
council, there was some discussion with our city manager in 
relation to utilizing the mains of the water--the water mains 
going through the cities that were, say, 8 to 12 inches, to be 
able to put some kind of a device to be able to create the 
energy. Has anybody even looked at an alternative way of 
developing that energy that may then not create the demand on 
the hydro--the grids, but be able to survive at least--not 
survive--promote and help the local residents be able to at 
least not have rolling blackouts? Anybody. Yes, ma'am.
    Ms. Eden. Thank you, Madam Chair. I will give you an 
example of the project, such as the one you might be referring 
to. In the Deschutes River Basin, which is just over the 
Cascades in Oregon, the irrigation districts and the Indian 
tribes and the irrigators have all gotten together and they are 
trying to do their best to save water and enhance everyone's 
business and everyone's way of life. One of the things they 
have done is to pipe irrigation canals so they are saving that 
water from evaporation. And they have put on at least one of 
those canals, on the new pressurized pipe, a hydro project. And 
I don't know exactly what the megawattage is of production.
    But I was surprised to hear that they were doing that on 
pressurized pipe. I just heard about that this week and it is 
something that they are looking at there, so it must be 
something that irrigation districts and others are looking at, 
especially all over the west.
    Mrs. Napolitano. May I ask on behalf of this Subcommittee 
that any information that you have be forwarded? Because that 
is important for us to begin looking at other alternative 
methods. And I can tell you at the time that we were looking at 
in the City of Norwalk they projected they would be able to 
provide electricity to the whole of the city hall complex, 
which included about 8 or 10 buildings, including sheriffs and 
libraries and other buildings. So it could be something that 
might be locally available and assist in being able to provide 
that new energy.
    Ms. Eden. Madam Chair, I would be happy to provide that 
information.
    Mrs. Napolitano. I would appreciate that. Anybody else?
    Mr. Morton. Madam Chairwoman, in giving thought to your 
comments, we have always thought big, big, big in construction 
of our dams and our hydropower. I think there is a great value 
in keeping in the picture a part of the whole puzzle, a part of 
the picture is the smaller operations. We have one on Sheep 
Creek. It is literally a creek. A family developed the power. 
This was 20 years ago. And have been very successful in selling 
it now to Avista. However, the regulations and the rules and 
the restrictions today would not permit them to be able to do 
that. They would not be permitted mainly because of the legal 
work involved and the many rules and regulations that really, 
as we see it, have not adversely impacted that stream of water. 
I think that is one thing we need to look at, too. Look at the 
turbines that can be used as the Scandinavian countries, the 
Netherlands, have done and we can benefit from their 
experiences.
    Mrs. Napolitano. Anybody else? Yes, Mr. Smith.
    Mr. Smith. Thank you, Madam Chair. And very briefly I 
guess, Commissioner Johnson, in speaking to the reliability of 
the grid and in referencing the blackout, the western 
electricity blackout in the 1990s and the chaos that it brought 
about, can you speak to how dams and hydropower could rise to 
the occasion for that?
    Mr. Johnson. Because they have an ability to start up 
immediately, hydropower facilities do have an ability to get 
the grid back up when you have a blackout. Now, that ability 
has not historically been used. It hasn't had to be used. But 
it is there, and it is a very valuable resource to provide that 
startup when and if the need occurs. But in the blackout that 
we had back in the 1990s, actually the hydro facilities were 
not used in starting that backup and I don't think that there 
was a need. They were able to do it without it. But certainly 
it is a valuable resource from that perspective.
    Mr. Smith. OK. An the grid is capable of transmitting that 
power in a sufficient manner?
    Mr. Johnson. I think in most cases, yes. But I am not--you 
know, I think that is probably a regional question that I don't 
have enough specific information to respond completely to.
    Mr. Smith. Thank you. On another topic I guess, 
Commissioner Johnson, you know, the current debate over climate 
change or, you know, that the weather is changing. Certainly, I 
think the evidence is in on that. As Mr. Costa suggested 
earlier, the debate is now how and why or what can we do to 
address that. But I think it is a good business decision 
affected by any entity affected by energy or--especially 
hydropower and global--and the climate change and the impact. 
How do you guys measure that at the agency? What do you do to 
kind of keep tabs on the effects of climate change?
    Mr. Johnson. We have been paying a lot of attention to 
climate change. One of the problems that we have is there is 
not a lot of basin-specific data that really allows you to do a 
good analysis of how we ought to be looking at operating our 
facilities in the future, the very question that Congressman 
Costa was raising earlier. We know that it is getting warmer. 
We know we are going to have earlier run-off. How should that 
change our operations of our systems? But we don't have the 
specific data in terms of, what is the stream flow going to be, 
what is going to be the microclimate on a basin-by-basin basis. 
We have an initiative in our 2009 budget called Water For 
America.
    Part of that initiative includes studies to try to get a 
better handle on that on a basin-by-basin basis. So we are 
hoping to get some more resources into that area to try to get 
a better handle on how we should be operating our facilities in 
light of climate change.
    Mr. Smith. I appreciate that. And let me just say that as 
one who represents a great number of irrigators in the greater 
reclamation system, I mean, certainly the drought of the west 
has impacted things drastically, and I think it is just a good 
business decision to keep tabs on that. Thank you.
    Mrs. Napolitano. Mr. Costa.
    Mr. Costa. Thank you very much, Madam Chairwoman--both 
Madam Chairwomen. To follow up on Mr. Smith's line of 
questioning and my statement that I made earlier, we do know 
something though, Commissioner. I mean, we had droughts in 
California, the late 1980s and early 1990 until 1992 a 6-year 
drought. We have been in extended drought on the Colorado 
River, so based upon those dry conditions, we know how the 
systems have been operated during that time period. I am 
wondering if you can give us some more information based on 
that modeling. And one other factor, I don't know that you have 
been involved, but I know others have with the study of tree 
rings in the microbasins on the Sierra Nevada and with trees 
that go back 2,000 years old, they are still alive and we have 
been able to determine that based on the proximity of those 
tree rings to one another, dry periods versus extended wet 
periods of time over hundreds and--actually up to almost 2,000 
years--which gives us some good record of precipitation.
    And one of the things that I have been told is that what it 
really clearly indicates is that the last 90 years in 
California on the microbasins of the Sierra Nevada have been 
unusually wet compared to other periods of time during the 
hundreds of years cycles going back 1,000, 1,500 years. If that 
is the case, we have 38 million people in California. We are 
projected to have 50 million in the not too distant future, 
2030, how are we going to make this water system work with the 
power?
    Mr. Johnson. Well, we have done the kind of analysis that 
you are talking about from a tree ring perspective. We have 
done quite a bit of study, particularly on the Colorado River 
Basin, to correlate tree rings with stream flow. And we have 
re-created a 500-year record on the Colorado River system that 
does give you the chance to look at extended periods of drought 
and how that would affect our operations on that system. And in 
fact, that information was included in the recent development 
of our shortage guidelines that we put in place on the Colorado 
River system just this last year.
    Mr. Costa. So we can, based upon that, determine how much 
reduced power that we will lose as a result of drought 
conditions?
    Mr. Johnson. Well, we can look at periods of the record 
that occurred in the past that were significantly dry. And we 
can say if that kind of drought condition might occur again----
    Mr. Costa. We will lose so much power?
    Mr. Johnson. Absolutely. We can look and see. We are going 
to lose a lot of power.
    Mr. Costa. Before my time expires though, some of the 
things we have done--and I wonder how well you have inventoried 
it that maybe raises less political opposition, i.e., raising 
spillway gates on reservoirs that add the capacity, you add the 
capacity that provides more water, whether it be for generation 
of electricity or for other purposes. Have you inventoried all 
those significant reservoirs, whether they be Bureau or in 
partnership with the Army Corps or projects that are owned by 
other entities that have hydro facilities on them that had the 
potential to raise gates?
    Mr. Johnson. Yeah. There was an Energy Policy Act that was 
passed about 2 years ago that required all Federal agencies to 
review power resources, hydroelectric facilities. And, in fact, 
I think there was a report that was provided to Congress that 
identified areas where--opportunities for more hydro 
development. Yes, sir.
    Mr. Costa. And how much additional power does it say we 
could realize?
    Mr. Johnson. We identified some in Bureau of Reclamation 
facilities. And I couldn't tell you off the top of my head but 
it is not a lot. To be real honest with you, there was not a 
lot.
    Mr. Costa. The Kiowa Reservoir in the late 1990s, the 
legislation I carried on the State level, and Caldula carried 
at the Federal level, added 48,000 acre feet of storage 
capacity to that reservoir.
    Small hydro, quickly, any of you have any idea of what 
small hydro can add to our renewable hydro source? No 
estimates?
    Mr. Gruenspecht. I know there are some projects--some of 
them are very preliminary--before the FERC. There is more of 
this hydro kinetic, which is the tidal, the instream, and the 
wave as well. And they are looking at about--I think now--some 
of this is prefiling but there is about six gigawatts, I would 
say.
    Mr. Costa. Didn't you say in your testimony about tidal--
you mentioned the tidal potential?
    Mr. Gruenspecht. No, I did not. I said we don't include it 
in our model to be clear because in our reference, we have a 
modest, very modest amount of additional conventional hydro 
added, and I think that was consistent with much of the others 
in the panel. But I wanted to make it clear that that was the 
conventional hydro, and this unconventional hydro, again, has 
some potential, but it is very early days and it is very hard 
to define exactly what that is.
    Mr. Costa. My time has expired. I thank both of you.
    Mrs. Napolitano. Thank you, everyone. That will conclude 
the first panel. We may submit some questions to you in writing 
and we would just ask that you respond as promptly as possible. 
Before the next panel is recognized, I wanted to ask unanimous 
consent that statements from the Navajo Tribal Utility 
Authority and the American Public Power Association be included 
in the record.
    [NOTE: The statements submitted for the record have been 
retained in the Committee's official files.]
    Mrs. Napolitano. And I think before the next panel comes 
up--those of you on panel 2, maybe you can start making your 
way to the table. I wanted to show the committee a 2-minute 
clip of a Today Show piece on hydropower that I thought you 
would enjoy.
    [Video is played.]
    Mrs. Napolitano. Thank you, Madam Ranking Member. It is 
very good to see something that we don't normally all get to 
visit. For our second panel, we have Mr. Scott Corwin, 
Executive Director of the Public Power Council from Portland, 
Oregon. Mr. Richard Roos-Collins, Director of Legal Service for 
the National Heritage Institute of San Francisco. He also 
serves as Chairman of the Board for the Low Impact Hydropower 
Institute and General Counsel for the Hydropower Reform 
Coalition. Also we have with us Mr. Bruce Howard, Director for 
Environmental Affairs for Avista Utilities from Spokane, 
Washington. And finally, Mr. Tim Culbertson, General Manager of 
the Grant County Public Utility District from Ephrata, 
Washington. Did I pronounce that right?
    Mr. Culbertson. That is good.
    Mrs. Napolitano. Welcome to the witnesses. And we will 
start off with Mr. Corwin. Your testimony, sir.

  STATEMENT OF SCOTT CORWIN, EXECUTIVE DIRECTOR, PUBLIC POWER 
                   COUNCIL, PORTLAND, OREGON

    Mr. Corwin. Great. Good afternoon, Chairwoman Napolitano, 
Ranking Member McMorris Rodgers, members of the committee. I am 
Scott Corwin, Executive Director of the Public Power Council, 
representing the consumer-owned utilities of the northwest who 
purchase power from the Federal Columbia River power system. 
They serve parts of seven States and serve 41 percent of the 
consumers in the region. I appreciate you holding this hearing 
today. Thank you very much for having this hearing and also for 
showing that media clip. That was well done and right on point. 
It actually displayed a lot of the points I am going to make.
    You have my written testimony for the record. So I am just 
going to quickly point on three points here, and I will focus 
on the Federal side. But I would agree with much of the 
testimony that I know both Tim Culbertson and Bruce Howard are 
going to present on the non-Federal side as well. Excuse me. I 
have a cough that is a constant condition of having three 
children under 7. So I apologize for that.
    But my first point is, it really is, as you saw partly in 
that video, it is really difficult to overstate how critical 
this issue is. Not just to the northwest but nationally. I know 
Ranking Member McMorris Rodgers understands this very well and 
represents us in the northwest very well in this respect. But 
the benefits of this hydropower system and the Columbia Snake 
River system are extensive because it is the fabric of our 
economy there in the region. And it is not a partisan matter. 
It is just a fact. It is renewable low-cost very reliable, very 
flexible power, and it is able to facilitate the newer 
renewables very well, as others have mentioned. But it is 
integrated also with much of the rest of the economy, including 
certainly on the irrigation side, the farming side, food 
processing, barge transportation, 40 million tons worth moving 
down this system. A friend reminded me as we were talking about 
this hearing to mention how this does function as a system. So 
we have especially, on the Federal side, but actually the whole 
system we have agreements to coordinate the hydropower and the 
transmission system, including with Canada. And this creates 
quite an amazing engine for the region.
    Northwesterners realize the value of this renewable power. 
In fact, we did some polling with a group called Northwest 
River Partners that showed very clearly that most citizens in 
the northwest view hydropower as renewable similar to solar and 
wind. This brings me to my second point about this system. It 
is a flexible system with storage capability. But it is not 
just a system for the northwest. In the 1960s and 1970s, and 
the video showed this very well, we had the foresight to build 
large transmission lines, 500 kilovolt lines south to 
California in the desert southwest.
    So we are connected in a real sense. In the summer, power 
moves south for cooling. In the winter power moves north for 
heating. And that works very well and that is a key to the 
western economy. It also works well in times of crisis. And I 
guess I would have an answer that differs slightly from Mr. 
Johnson's question on the first panel. I think the hydropower 
system has been critical in times of energy crisis to avoid 
even worse crises because in part of the storage capability 
there, not to mention the fact that the generators themselves 
are very reliable. And in fact, on the Federal system, they 
have a forced outage rate of about 3 percent. So it is a very 
reliable system and very useful in many respects to avoid 
problems with generation.
    And that brings me to my third point on emissions, just to 
finish up. I think the benefits to hydro are worldwide, but 
they are definitely west wide. And I would just point to you a 
couple of charts that I have on page 4 of my testimony that 
show that when you have better hydro years, in figure A, you 
have lower emissions and vice versa. You also, as 
Representative McMorris pointed out very well, would have much 
increased CO2 production if you take out generation, such as 
some had proposed on the Snake River.
    So this is a safe, reliable, low-cost resource. It is a 
proven technology and it is too valuable to neglect or degrade 
in light of the great challenges facing us moving for. Again, 
thank you very much for your leadership and holding this 
hearing today.
    Mrs. Napolitano. Thank you, sir. I couldn't agree with you 
more.
    [The prepared statement of Mr. Corwin follows:]

           Statement of R. Scott Corwin, Executive Director, 
                          Public Power Council

    Greetings Chairwoman Napolitano, Ranking Member McMorris Rodgers, 
and Members of the Sub-Committee. I thank you for the opportunity to 
testify today on this important topic.
    The Public Power Council (PPC) is a trade association representing 
the consumer-owned utilities of the Pacific Northwest with statutory 
rights to purchase power from the Federal Columbia River Power System. 
Member utilities have service territories in portions of seven western 
states and serve over 41% of the electricity consumers in the region. 
We are committed not only to preserving the value of the Columbia River 
system in terms of its clean and reliable electricity for consumers, 
but also to furthering the trust responsibilities and stewardship goals 
we all share within the region.
Hydropower and Energy Policy
    We appreciate your initiative in raising the issue before us. 
Hydropower has played, and will continue to play, an incredibly 
important role in our nation's energy policy. As I will describe, 
hydropower is a renewable resource with numerous beneficial aspects 
including its lack of emission of gases and its status as being 
uniquely well-suited to facilitating other renewable resources. The 
irony is that many current policy proposals disadvantage hydropower or 
would penalize regions like the Northwest where we already have made 
enormous investments not only in hydropower and other renewable 
generation, but also in energy conservation. In fact, since we started 
keeping track with the Northwest Power Act in 1980, the Northwest has 
achieved 3,700 average megawatts of energy-efficiency, enough 
electricity to serve the entire state of Idaho and portions of Montana.
    Despite these good efforts, increasing demand for electricity in 
the Northwest will continue to outpace the addition of new conservation 
or other renewable resources. Therefore, it is very possible that 
constraints on hydropower could have the effect of pushing the region 
more quickly toward higher-cost, higher-emitting sources of generation. 
The economic impacts of this direction are of great concern in light of 
the possibility of new policies regarding carbon emissions.
The Role of Hydropower in the West
    Hydropower is the original renewable source of power beginning with 
the waterwheel used to grind corn in ancient times. In many areas of 
the country, hydropower is a major driver of economic vitality. In the 
Northwest, it has been nothing less than the lifeblood of the region 
throughout modern history. The dams lend not only a clean, continuing 
supply of power, they are critical to transportation, irrigation, flood 
control, and recreation as well. Barging on the Columbia River moves 40 
million tons of goods each year and keeps hundreds of thousands of 
trucks and their associated emissions off of the road. According to the 
Pacific Northwest Waterways Association, the Columbia and Snake River 
Basin is the number one transportation gateway nationally for wheat, 
barley and several other commodities.
    To an area that was still largely without electricity in the early 
20th century, the dams brought light and then hope of economic 
vitalization coming out of the great depression. Construction on the 
larger projects, such as Bonneville and Grand Coulee Dam began in 1933. 
But, long before that hydropower was beginning to make its mark in the 
Northwest, including the first ``long distance'' transmission of 
electricity 14 miles from Willamette Falls to the streetlights of 
Portland in 1889.
    In the Federal Columbia River Power System (FCRPS) there are now 31 
dams ranging from a three megawatt diversion dam in Boise, Idaho, to 
the 6795 megawatt Grand Coulee Dam in Washington (See Appendix 1). 
Total peak capacity of the resources marketed by the Bonneville Power 
Administration (BPA) totals 13,934 megawatts, and almost 90% of that is 
hydropower. In the entire Northwest region, there is about 41,500 
megawatts of capacity with close to 60% of it in hydropower.
The Benefits of Hydropower as a Renewable Resource
    Even though hydropower may fluctuate year to year, month to month, 
or week to week, it is stable and flexible within short periods of 
time. It has very important positive characteristics in addition to 
deriving its source of energy from continuously renewable water: (1) It 
is efficient in its conversion of energy; (2) It is clean in that it 
does not have waste heat or external emissions; (3) It is reliable 
since it makes use of basic and time-tested technology; (4) It is 
domestic to the United States; (5) It is generally low-cost; and, (6) 
it is flexible in that it can adjust quickly to changes in demand.
    Ratepayers of the Northwest receive the benefit of this resource 
and they pay for all of the costs of this system. Electricity 
ratepayers pay for all of the operations, maintenance, and capital of 
the system. And, they are cognizant of the great benefit hydropower 
lends from an environmental perspective. In fact, polling conducted 
last year on behalf of Northwest RiverPartners 
(www.nwriverpartners.org) showed that 86% of respondents view hydro as 
a renewable resource similar to wind or solar. And, hydro far out-
ranked other sources when respondents were asked which of the various 
sources of energy within the region is the most practical to rely upon.
    In the context of the current search for new non-emitting energy 
sources, the reliability and flexibility of hydropower make it 
particularly well-suited to integrating other renewable sources of 
energy, such as wind, that are much more intermittent. The system 
operated by BPA currently is integrating a total of over 1400 megawatts 
of wind generation. This 1400 megawatts is expected to double in the 
next few years, and could double again after that to approach 6000 
megawatts according to current projections. Because of the variable 
nature of wind production, pairing it with hydropower is an effective 
method of creating a more reliable power supply.
Hydropower and Emissions
    Because of the 31 dams and the nuclear plant in Washington that is 
also part of the federal system, customers of BPA have some of the 
cleanest power anywhere from an emissions perspective. With hydropower 
as 80.7% of the firm energy used by most customers of BPA, and nuclear 
adding another 12%, the portfolios of many of our member utilities are 
over 92% emissions free.
    On the next page are two charts demonstrating a key aspect of 
hydropower with respect to emissions--it has none. I would like to 
commend those on the Northwest Power and Conservation Council (NWPCC) 
for taking on the task of studying the impacts of this dynamic last 
year. The NWPCC is an unbiased interstate compact created by the 
Northwest Power Act in 1980 to advise the region on power, 
conservation, and fish and wildlife issues. They found that, while the 
Northwest has much smaller CO2 output than other regions, its CO2 
production from electricity will grow 20% over the next 20 years to 
over 70 million tons annually, even if we meet fairly aggressive 
targets for conservation and new renewable generation. This is because 
most of the resources realistically available for the current planning 
horizon are coal and natural gas fired generation. Figure A on the next 
page shows how CO2 emissions are inversely proportional to hydropower 
production in the Northwest: the better the water year, the lower the 
emissions.
    In addition, the NWPCC found that breaching the four lower snake 
dams, as some have proposed for salmon, would significantly exacerbate 
the issue by adding 4.6 million tons of CO2 annually within the 
Northwest, and 5.2 million tons annually across the entire West-wide 
system (See Figure B, next page). Also, in light of success with other 
passage methods, we have questioned the efficacy and efficiency of some 
of the extremely expensive spill operations on the federal system where 
water that could produce power is flushed downstream in an attempt to 
pass juvenile fish over the spillways. The choices and opportunity 
costs are even more poignant when one recognizes, as the NWPCC showed, 
that current spills send five million tons of CO2 into the air as 
replacement power is generated for what would otherwise be electricity 
from hydropower. The entire report can be viewed online at http://
www.nwcouncil.org/library/2007/2007-15.htm

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Hydropower in the Future
    Last summer the Electric Power Research Institute estimated that 
the potential increase in hydropower generation nationally could be 
23,000 MW by 2025, and as much as four times that remains undeveloped. 
In the Northwest, we will be looking for opportunities wherever 
possible. Some of those efforts may involve projects on a very small 
scale such as irrigation drops. Some are needed enhancements at the 
larger projects.
    Part of the challenge is maintaining the system we have. Over the 
next two decades, total annual operations and maintenance costs to 
ratepayers for the FCRPS hydro program are expected to increase from 
just under $250 million annually, to over $350 million per year. Adding 
annual capital costs doubles this amount. Grand Coulee was mentioned 
earlier in this hearing. Operations and maintenance at that single 
project cost over $60 million per year. Because hydropower projects 
experience these costs regardless of how much output they provide, we 
have a serious interest in ensuring that their operations are not 
constrained for non-power reasons unless absolutely necessary.
Challenges for Hydropower
    A challenge for hydropower in the near future comes from the 
increasing demand for electricity combined with the natural and 
regulatory limitations on generation. In other words, there is a limit 
to the available capacity of the system, and therefore a limit to the 
demands that can be placed on the system regardless of whether those 
demands are for fish and wildlife, integrating wind or other 
intermittent resources, or following customers' loads placed on the 
system. Work is underway in the region to better identify the available 
capacity on an hour by hour basis throughout the year.
    So far, I have focused mostly on the positive aspects of hydropower 
because they are numerous. But, in the Northwest, we are also very 
aware of its impacts to the environment because we have made enormous 
commitments of time and money to address these issues.
    Treaties with tribal governments and statutes such as the Northwest 
Power Act and the Endangered Species Act play major roles in how we 
manage the hydropower system for salmon and steelhead in the Northwest. 
In fact, the federal agencies overseeing the FCRPS just signed 
memoranda of agreement with several tribes and states in the Northwest 
assuring over $900 million in funding for projects in order to address 
fish and wildlife needs over the next 10 years. At the same time, these 
agencies released a new biological opinion under the Endangered Species 
Act that represents an enormous collaborative scientific effort. This 
biological opinion came with another set of costs and operational 
constraints on the system.
    Operational constraints on federal Columbia River hydropower, such 
as spilling water over the dams or adjusting the timing of flows in the 
river, have reduced the average generation of the system by about 1000 
average megawatts of energy, or about 13%, since 1995. According to 
BPA, the fish and wildlife cost category will account for about 30 
percent of the rates charged to customers for the upcoming rate period, 
or about $800 million per year. The ratepayer cost for fish and 
wildlife mitigation, just in the federal hydropower system, totaled 
$9.3 billion from 1978-2007.
    At the same time, fish passage through the projects has been good 
and is improving all the time. Adult passage using ladders has been 
excellent for many years. And, new technology is seeing juvenile fish 
passage downstream at very high rates. In fact, the new biological 
opinion sets a very high, but achievable, targets for juvenile passage 
at each dam of 96% in the spring and 93% in the summer.
    It is useful to remember that hydropower is only one of many 
factors impacting species. Historically, the impacts of over-fishing, 
poor hatchery practices, habitat degradation, and naturally occurring 
ocean conditions have been major contributors to the status of salmon 
and steelhead stocks. Any approach to salmon recovery that will be 
successful long-term must take into account all aspects of the salmon 
lifecycle including impacts from hydro, hatcheries, harvest, and 
habitat.
Conclusion
    In light of its significant benefits to customers and to the 
environment as a clean, renewable, and flexible form of generation, 
hydropower should be preserved, encouraged, and enhanced where 
possible. Over the last 70 years of major hydropower production in the 
Pacific Northwest, citizens of our region and neighboring regions have 
benefited from this resource and its clean energy, low impact 
transportation, irrigation, flood control, and recreation.
    At a critical time in our nation's history with respect to energy 
policy, hydropower is positioned to take a lead role if our state and 
federal policies allow it to do so. As a safe, reliable, and low-cost 
resource that has the means to enable other renewable generation, this 
proven technology is too valuable to ignore in light of the challenges 
facing us in the days and years to come. Again, thank you for your 
leadership in holding this oversight hearing today.

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                                 ___
                                 
    Mrs. Napolitano. Mr. Roos-Collins.

 STATEMENT OF RICHARD ROOS-COLLINS, DIRECTOR, LEGAL SERVICES, 
           NATIONAL HERITAGE INSTITUTE, SAN FRANCISCO

    Mr. Roos-Collins. Madam Chairwoman, Ranking Member McMorris 
Rodgers, other Members, thank you so much for holding this 
hearing and also for this opportunity to testify. I have four 
points. The first is that non-Federal hydropower provides 
multiple benefits: Power generation, water supply, flood 
control, water quality protection, fish and wildlife 
enhancement. Indeed your predecessors and FDR 73 years ago 
enacted the Federal Power Act, which requires that each project 
must be best adapted to a comprehensive plan of development of 
the affected waters for all of these beneficial uses.
    Now since 1986, many of the projects that were built way 
back when have been relicensed. In the course of those 
decisions, the power generation has--98 percent of the power 
generation has been preserved. The generation capacity has 
actually increased by 4 percent. And in addition, the projects 
now provide substantially greater benefits for fish and 
wildlife and recreation and water supply and flood control for 
the benefit of all of the affected communities. Indeed, most of 
these new licenses are based on settlements. In part, because 
the Hydropower Reform Coalition, whose Executive Director is 
here and the National Hydropower Association, whose Executive 
Director is also here, have advocated to our respective members 
that settlements are preferable to litigation as the basis for 
these relicensing decisions.
    Now, a few of these projects have been decommissioned, but 
they have been decommissioned only where the utilities or the 
merchant generators who own them concluded that it is in their 
interest as well as the public interest to decommission them. 
My second point goes to Federal projects. Congress, of course, 
authorizes Federal projects directly. They have what amount to 
perpetual licenses. Nonetheless, every Federal operator has 
authority to re-examine its plan of operation, or the rules 
which guide its operations at each project.
    Unfortunately due to budget and staff constraints, the 
plans for many of these projects are literally decades old. 
This Subcommittee should encourage all Federal operators to 
look at their plans of operation, and I mean, every one of 
them, in order to optimize the power generation and other 
benefits which these projects could provide. And indeed that 
would be an excellent opportunity to look at climate change. 
Now, to answer Congressman Costa's question, in California, the 
Department of Water Resources has now looked at climate change 
sufficiently to predict the range of impacts on water supply 
operations. The best case involves substantially greater risk 
of spills from our storage dams. And the worse case is much 
worse. We now have the knowledge in California--and I believe 
in other States--to begin integrating climate change, whatever 
causes it, into the operational decisions for Federal and non-
Federal hydropower alike.
    My third point goes to retrofitting of existing projects, 
whether Federal or non-Federal. In answer to another question, 
I believe that existing projects are existing capital stock, 
should be retrofitted where that can be done in a manner that 
provides enhanced benefits, power generation, water supply, 
recreation, fish and wildlife protection. Indeed the Low Impact 
Hydropower Institute, which is a voluntary enterprise 
established by the conservation community, has now certified 
more than 2,000 megawatts of capacity in this country, some of 
it incremental hydropower redevelopment precisely for that 
reason so as to provide market benefits for retro-fits.
    And in turn, we helped sponsor the legislation, Madam 
Chairwoman, that you referenced, H.R. 6049 and support 
production tax credits for retrofits. And as for opportunities 
at the Federal projects, again, I believe that if the Federal 
operators examine their plans of operation, they could find 
opportunities for retrofits and bring those back to this 
Congress for funding.
    My last point goes to new development. Hydrokinetic or 
damless technology has substantial promise, whether in the East 
River, the Wright project that was mentioned earlier, or in 
estuaries or even in the ocean. At this point we don't know how 
real that promise is. What we need to do is test it by actually 
having pilots built and then monitoring them carefully and 
adapting to see how well they perform to providing the benefit 
of power generation while also protecting the local ecosystem. 
And yes, Madam Chairwoman, I agree that canals and other 
pressurized facilities should be examined for retrofits as well 
to install these turbines so as to extract the maximum value 
from the water that is delivered for other purposes.
    In sum, I believe that time is of the essence for us to 
improve our hydropower policy so that hydropower continues to 
provide the multiple benefits it does today. Thank you.
    Mrs. Napolitano. Thank you for your testimony. And it is 
really very much in tune with what we are hoping to find as 
different assistance to be able to address global warming, 
climate change, whatever you want to call it. And the 
increasing demands. And also help the power groups be able to 
do their job.
    [The prepared statement of Mr. Roos-Collins follows:]

    Statement of Richard Roos-Collins, Director of Legal Services, 
                       Natural Heritage Institute

    Chairwoman Napolitano, Ranking Member McMorris Rodgers, and Members 
of the Subcommittee, thank you for this the opportunity to testify on 
the present and future of hydropower.
    I am Richard Roos-Collins. I am the Director of Legal Services for 
the Natural Heritage Institute (San Francisco), a public interest law 
firm which represents conservation groups and public agencies in 
efforts to resolve complex energy and water disputes for public 
benefit. I am Chairman of the Board of the Low Impact Hydropower 
Institute (Portland, ME), which certifies non-federal hydropower 
projects so as to provide market rewards for their exceeding regulatory 
requirements for environmental protection. And I am General Counsel to 
the Hydropower Reform Coalition (Washington, D.C.), a nationwide 
association of 140 groups (representing more than 1 million members) 
interested in the relicensing of non-federal hydropower projects to 
restore environmental quality consistent with reliable electricity 
generation.
    Hydropower today provides an average of 96,000 megawatts of 
generation capacity. This consists of 42,000 megawatts at federal 
projects, and 54,000 megawatts owned and operated by non-federal 
licensees regulated by the Federal Energy Regulatory Commission (FERC). 
All told, hydropower is roughly 75% of all generation capacity which 
the DOE Energy Information Administration categorizes as renewable.
    Hydropower capacity has not changed significantly in the past two 
decades. This oversight hearing allows us to focus on the future. 
Should hydropower capacity be increased as a deliberate strategy to 
meet growth in electricity demand and mitigate the climate change 
impacts of non-renewable generation?
    My answer is: yes, done in a manner which will protect and enhance 
other beneficial uses of the affected waters. Rivers, estuaries and the 
oceans are public commons which have many beneficial uses. These 
include water supply, flood control, recreation, and fish and wildlife 
in addition to electricity generation. In the Federal Power Act of 
1935, Congress required that each non-federal project must be best 
adapted to a comprehensive plan of development for all such beneficial 
uses. That bedrock principle is as vital today as 73 years ago. The 
laws authorizing federal hydropower projects contain similar 
requirements. I will discuss the future of federal hydropower by first 
reporting lessons recently learned in non-federal hydropower.
    Since the enactment of the Electric Consumers Protection Act (ECPA) 
in 1986, FERC has relicensed more than three hundred non-federal 
hydropower projects. As required by the 1935 Federal Power Act and 
ECPA, each new license must comply with current laws, including the 
Endangered Species Act and Clean Water Act. According to FERC's 
Comprehensive Review and Recommendations Pursuant to Section 603 of the 
Energy Policy Act of 2000 (2001), the new licenses reduced the 
historical generation at these projects by 1.6% while increasing 
capacity by 4.1%. These changes resulted from new flow regulation 
conditions to enhance fisheries, recreation, and other non-
developmental uses. These enhancements provide substantial economic 
benefits for local communities. FERC concluded that these new licenses 
are better adapted than the original licenses to comprehensive plans of 
development of the affected waters.
    Most new licenses for non-federal hydropower are now based on 
settlements. In such a settlement, the licensee, regulatory agencies 
and conservation groups, and other local stakeholders resolve their 
disputes about the project and commit to cooperate in the 
implementation of environmental conditions over the term of the new 
license. FERC will approve such a settlement upon concluding that it 
meets the legal requirements for a new license. As recently as a decade 
ago, relicensing decisions were almost always contested and litigated. 
This sea change occurred because the non-federal hydropower industry 
(represented by National Hydropower Association), the conservation 
community (represented by the Hydropower Reform Coalition 
(www.hydroreform.org)), and other stakeholders agreed to support and 
implement policy reforms under existing laws to encourage such 
settlements. To its credit, FERC adopted the Alternative Licensing 
Process (1997) and the Integrated Licensing Process (2003), which do 
just that. This policy change is driven by the recognition that a 
settlement establishes a joint commitment to the future of the 
project--not only compliance with license conditions, but also 
adaptation to changed circumstances over the 30-50 year term of the 
license.
    Recent market reforms promise to improve the future of non-federal 
hydropower. Since 2001, the Low Impact Hydropower Institute (LIHI) 
(www.lowimpacthydro.org) has offered certification to any project owner 
who voluntarily applies and demonstrates compliance with performance 
standards which exceed minimum regulatory requirements for 
environmental protection. The certification may then be used to secure 
premium rates in retail markets which permit such consumer choice. LIHI 
has now certified 2,043 megawatts of non-federal hydropower. This is 
the only such program in the nation. Its future is bright. LIHI has 
more pending applications than at any time in its history. Project 
owners increasingly recognize that this certification program provides 
retail market rewards for their efforts to reduce their environmental 
impacts consistent with reliable electricity generation.
    As another important example of market reform, the National 
Hydropower Association, the Hydropower Reform Coalition, and the Union 
of Concerned Scientists recently proposed legislative language, 
included in the energy bill (H.R. 6049) passed by the House last month, 
to provide production tax credits to retrofit existing dams to expand 
or add generation capacity. While a technical reform in tax law, this 
demonstrates how the industry and conservation community may 
effectively collaborate in legislation, when needed to enhance the 
public benefits of hydropower.
    So what do these developments in non-federal hydropower suggest for 
the federal hydropower which is under this Subcommittee's direct 
jurisdiction?
    Federal operators should examine possible modifications to their 
plans of operation and even the design of their hydropower projects. 
Each project has such a plan, initially adopted during or just after 
construction to state the rules of operation. A typical plan is many 
decades old. Federal projects are not subject to a fixed term as with 
non-federal hydropower, and budget constraints have limited the 
willingness of federal operators to reopen their plans. Nonetheless, 
existing laws permit and even require the Army Corps of Engineers, 
Bureau of Reclamation, and other federal operators to periodically 
examine possible modifications to the plans of operation for all 
projects they administer. Such review will improve electricity 
generation--operationally or by justifying physical retrofit of the 
generation capacity. It will enhance other public benefits, including 
water supply, navigation, and environmental protection. A federal 
operator often has authority to implement such modifications in 
operations or even physical design, subject to reporting to Congress. 
Such review includes public participation and may also result in better 
understanding and even support by local stakeholders for the future 
operations of a federal project. In 2002, the Army Corps entered into a 
Memorandum of Understanding with The Nature Conservancy 
(www.nature.org/initiatives/freshwater/partnership/) to examine plans 
of operation at several pilot projects. This Subcommittee should 
encourage federal operators to systematically use existing authorities 
to optimize their project operations for all public benefits.
    Federal operators should consider how to adapt to climate change 
when they review their plans. Climate change will significantly affect 
local hydrology--the timing, volume, and temperature of flows--in all 
regions of our nation. This will alter electricity generation, water 
supply, and other purposes of federal projects. It will cause 
significant stress to anadromous fisheries and other aquatic species. 
Federal operators should systematically examine alternatives to 
optimize future performance of their projects in the face of such 
change. An example which Natural Heritage Institute (www.n-h-i.org) is 
pursuing in California and elsewhere in the West is diversion into 
storage of the increased flood flows likely to result from climate 
change, where the storage will not be behind the federal project but 
instead in a downstream groundwater aquifer or floodplain.
    This hearing topic also asks the question: leaving aside existing 
projects, what is the prospect for new hydropower development? Over the 
course of many decades, general surveys have shown undeveloped physical 
potential for such development. However, those surveys are predictions. 
They do not give due weight to other variables for a given site, 
including the likely return on investment, the capacity of the local 
transmission system, foreseeable impacts on other beneficial uses of 
the affected waters, legal requirements, or the views of local 
stakeholders. Actual development of new hydropower will turn on the 
ability of a sponsor to manage all of these variables and produce net 
public benefits including but not limited to the new generation 
capacity.
    For example, non-federal developers are exploring the potential for 
hydrokinetic (or damless) development in our estuaries and oceans. 
Although no commercial project exists in those waters today, more than 
a hundred sites are under active investigation. The National Hydropower 
Association and Hydropower Reform Coalition are again exploring 
possible policy reforms under existing laws to permit new development 
consistent with protection of the marine environment. I offer my thanks 
to the Natural Resources Committee for your substantial attention to 
ocean energy in the reauthorization bill for the Coastal Zone 
Management Act. In my view, this hydrokinetic technology will mature 
rapidly as we find the right pilot sites, learn how to efficiently 
apply and complete the regulatory process in this largely unknown 
marine environment, and then adapt both operations and design following 
construction.
    In sum, the future of hydropower depends fundamentally on the 
continued willingness of the non-federal licensees and federal 
operators to generate electricity in a manner which protects and 
enhances other beneficial uses of the affected waters. In political 
terms, I mean simply that the industry, conservation community, and 
other stakeholders should work together, and systematically, to create 
that common future.
    Thank you for considering this testimony.
                                 ______
                                 
    Mrs. Napolitano. Mr. Howard.

  STATEMENT OF BRUCE HOWARD, DIRECTOR, ENVIRONMENTAL AFFAIRS, 
             AVISTA UTILITIES, SPOKANE, WASHINGTON

    Mr. Howard. Thank you. Chairwoman Napolitano and Ranking 
Member McMorris Rodgers, I am Bruce Howard, Director of 
Environmental affairs for Avista Corporation. Thank you for the 
opportunity to testify. Avista is an investor-owned utility 
headquartered in Spokane, Washington, that provides electric 
and natural gas service to approximately 480,000 customers in 
eastern Washington, northern Idaho and Oregon. Our service 
territory includes much of Congresswoman McMorris Rodgers's 
district.
    We are greatly appreciative of her champion work on behalf 
of hydropower and the communities we serve. Hydropower is 
Avista's largest electric resource, comprising over half our 
generating capacity. Our hydropower resources are licensed by 
the Federal Energy Regulatory Commission and include the 788 
megawatt Clark Fork Project in Montana and Idaho, as well as 
the 154 megawatt Spokane River Project in Washington and Idaho. 
We also own the 50 megawatt Kettle Falls biomass generation 
station in Kettle Falls Washington, which is fueled by wood 
waste.
    We recently announced the planned development of a wind 
generation facility also in Congresswoman McMorris Rodgers' 
district. Our investments in renewable energy, along with our 
leading demand side management programs, make Avista's carbon 
footprint very low in comparison to other electric utilities 
throughout the United States.
    Hydropower provides extensive economic environmental and 
reliability benefits. It is the largest single renewable 
electric resource in the United States, providing approximately 
9 percent of total U.S. summer capacity. Hydropower is emission 
free, especially significant at a time in which we are seeking 
to reduce greenhouse gas emissions. In addition, the hydropower 
industry has actively addressed environmental concerns, as we 
have just heard, through their licensing process and other 
regulatory processes and by employing innovative technologies. 
Hydropower also enhances the reliability of electric system. In 
addition to being a highly reliable power source in its own 
right, hydropower firms other intermittent renewable resources 
such as wind and solar power. And we know that hydropower will 
be called upon more and more in the future to enable these 
alternative resources.
    The conventional wisdom is that hydropower has little 
growth potential in the future. This isn't the case. While the 
opportunities for building large new conventional hydropower 
projects are limited, there is significant potential to add 
capacity at existing facilities through upgrades as well as 
through the addition of pump storage facilities. Pump storage 
facilities take advantage of demand and cost differentials to, 
in effect, store energy. There are also opportunities to 
incorporate electrical generation at nonpower dams as well as 
for entirely new small hydropower facilities. Moreover, 
substantial new hydropower resources are available through 
innovative hydrokinetic technologies that will tap the energy 
of river tidal and ocean currents. FERC statistics indicate 
active license applications for over 1,300 megawatts of new 
conventional and pump storage hydropower and over 3,200 
megawatts of additional capacity are in the prefiling stage at 
FERC.
    More than 6,000 additional megawatts of hydrokinetic 
capacity are also in the prefiling stage. While not all 
projects in the prefiling stage at the FERC will mature into 
applications, these figures demonstrate the tremendous interest 
in new hydropower development. For Avista, the most important 
thing Congress can do at this time is to secure long-term 
extension and expansion of the production tax credit for 
incremental hydropower that was enacted by Congress as part of 
the Energy Policy Act of 2005. Based in part on obtaining PTC 
half credits of .9 cents per kilowatt hour, Avista embarked on 
a series of upgrades to its existing hydropower dams, adding 7 
megawatts of capacity to date with approximately 36 more 
megawatts available for further upgrades. Because of the long 
lead time associated with replacing turbines, it is essential 
that Congress renew the PTC for an extended period along with 
the counterpart CREB program that supports renewable 
investments by municipal and cooperative utilities. Avista also 
strongly supports the agreement recently reached by the NHA and 
environmental groups to support the expansion and application 
of the PTC and CREB program to the development of power at dams 
that currently do not generate electricity. Climate change 
legislation may well become the biggest policy driver impacting 
future energy investments including investment decisions 
regarding hydropower. It is important that these investments 
made be rewarded rather than penalized in any cap and trade 
legislation adopted by Congress.
    Therefore, Avista urges Congress to allocate any admission 
standard allowances to utilities based on their electricity 
output or load served not based on historic greenhouse gas 
emissions. Finally, Federal support for hydropower research and 
development has been relatively minimal for many years. Robust 
R&D developments and hydropower are essential if we are to tap 
the full potential of innovative hydropower solutions. Avista 
strongly supports NHA's efforts to expand this funding.
    In closing, Avista deeply appreciates this opportunity to 
testify and commends the Subcommittee for its leadership on the 
important issue of the contribution of hydropower to our 
Nation's energy future.
    Mrs. Napolitano. Thank you Mr. Howard. And I am hoping the 
Senate does keep that provision, does not delete it so that you 
do have some support on that bill.
    [The prepared statement of Mr. Howard follows:]

                 Statement of Bruce Howard, Director, 
               Environmental Affairs, Avista Corporation

I. INTRODUCTION
    Chairwoman Napolitano, Ranking Member McMorris-Rodgers and members 
of the Subcommittee, I am Bruce Howard, the Director of Environmental 
Affairs for Avista Corporation. Avista appreciates the opportunity to 
testify, and commends the Subcommittee for holding this hearing on the 
critical role of hydropower as a renewable resource.
    Avista is an investor-owned utility headquartered in Spokane, 
Washington, that provides electric and/or natural gas service to 
approximately 480,000 customers in eastern Washington, Northern Idaho, 
and Oregon. Hydropower is Avista's largest power resource, comprising 
approximately 52% of our electric generating capacity.
    Our hydropower resources are licensed by the Federal Energy 
Regulatory Commission (FERC), and include the 788 megawatt (MW) Cabinet 
Gorge-Noxon Rapids Project in Montana and Idaho (also known as the 
Clark Fork Project), and the 154 MW Spokane River Project in Washington 
and Idaho. We also own the 50 MW Kettle Falls biomass generation 
station in Kettle Falls, Washington, which is fueled by wood waste. Our 
investments in renewable hydropower and biomass, along with our highly 
efficient natural gas generation and energy efficiency, conservation, 
and other demand side management programs, make Avista's ``carbon 
footprint'' very low in comparison to most electric utilities in the 
United States.
II.  THE MANY BENEFITS OF THE RENEWABLE HYDROPOWER RESOURCE
    Hydropower provides extensive economic, environmental and 
reliability benefits. It is the largest renewable electric resource in 
the U.S., providing approximately nine percent of U.S. total summer 
capacity. Hydropower is emission-free, a very significant environmental 
benefit in an era in which we are seeking to reduce greenhouse gas 
emissions to slow global climate change. In addition, any adverse 
environmental impacts of hydropower on aquatic resources have been 
substantially reduced or eliminated through the relicensing process, 
new and innovative technology, and the application of key environmental 
laws.
    To give just one example, the collaborative alternative licensing 
process used by Avista for the relicensing of the Clark Fork Project in 
Montana and Idaho resulted in a ``win-win'' settlement with all key 
agencies and stakeholders. For example, to implement the project's new 
license, over 2,600 acres of key bull trout habitat have been acquired, 
protected, and restored, and six miles of stream habitat have been 
recreated or restored. The settlement and new license, which was 
approved by the FERC in 2000, provide major environmental enhancements 
and, at the same time, preserve the economic benefits of the Project. 
In addition, this Project, like many others, provides unique 
recreational and other community benefits.
    Hydropower also enhances the reliability of the electric system. As 
a highly flexible firm power resource, hydropower provides load 
following, spinning reserve, and other ``ancillary'' services that are 
critical for keeping the lights on. In addition, emission-free 
hydropower is ideally suited to firming intermittent renewable 
resources such as wind and solar power. Therefore, hydropower is not 
only a renewable resource in its own right, but it also enables 
additional wind and solar power resources.
III.  HYDROPOWER CAN PROVIDE EVEN MORE BENEFITS IN THE FUTURE
    In some circles, the conventional wisdom is that while hydropower 
is a fine resource, it has little growth potential in the future. This 
is not the case. Instead, given the challenges associated with climate 
change, we must make a concerted effort to maximize the use of all 
emission-free renewable resources, including hydropower.
    While the opportunities for building large, new conventional 
hydropower projects are limited, significant potential exists to add 
generation capacity at existing hydropower dams and new electrical 
generation to existing non-hydropower dams. There are also 
opportunities for entirely new small hydropower facilities. Moreover, 
substantial new hydropower resources are available from new and 
innovative hydrokinetic technologies that tap the energy of river, 
tidal, and ocean currents, without the installation of any dam or 
impoundment.
    Further, considerable potential exists for new ``pumped storage'' 
hydropower facilities that pump water into an off-river upper reservoir 
during off-peak hours when power demand and prices are low (typically 
at night and on the weekends) and then release the stored water to 
generate power on-peak during weekdays when demand and power costs are 
high.
    FERC statistics indicate that there are pending license 
applications for 430 MW of conventional hydropower capacity and 900 MW 
of pumped storage capacity. Also, there are 448 MW of conventional 
hydropower capacity, 2,783 MW of pumped storage capacity, and 6,000 MW 
of hydrokinetic capacity in the pre-filing stage at FERC, before a 
license application is filed. While not all projects in the pre-filing 
stage at FERC will mature into applications, these figures demonstrates 
tremendous interest in new hydropower technologies and pumped storage.
V.  WHAT CONGRESS CAN DO TO HELP TAP HYDROPOWER'S NEW POTENTIAL
A.  Extend and Expand the Application of the Renewable Production Tax 
        Credit/Clean Renewable Energy Bonds to Hydropower
    For Avista, the most important thing Congress can do at this time 
to spur additional hydropower development at its existing hydropower 
facilities is to secure a long-term extension and expansion of the 
production tax credit (PTC) for incremental hydropower that was enacted 
by Congress as part of the Energy Policy Act of 2005.
    Based in part on obtaining the PTC half credit of 0.9 cents per 
kwh, Avista has embarked on a series of upgrades to its existing 
hydropower dams, adding at total of 7 MW of capacity to date, with 
approximately 36 more MW available from further upgrades. Because of 
the long lead times associated with replacing turbines, it is essential 
that Congress renew the PTC for an extended period, as well as the 
counterpart ``Clean Renewable Energy Bond'' (CREB) program that 
supports renewable investments by municipal and cooperative utilities.
    Avista also strongly supports the landmark agreement recently 
reached between the National Hydropower Association (NHA), American 
Rivers (AR), the Union of Concerned Scientists (UCS), Trout Unlimited 
(TU), and the Natural Heritage Institute (NHI) to support the expansion 
and application of the PTC and the CREB program to the development of 
hydropower at non-hydropower dams. Avista commends these parties for 
working together constructively to develop compromise legislative 
language to provide PTC and CREB support for hydropower at non-
hydropower dams, and greatly appreciates the inclusion of this language 
in the energy tax bill recently passed by the House. This is an 
excellent example of how policies regarding hydropower deserve 
reconsideration in light of the emission-free electricity hydropower 
provides. Avista also supports the language in the House-passed bill 
making new hydrokinetic technologies eligible for the PTC and CREB 
program.
B.  Appropriate Treatment of Hydropower in Climate Change ``Cap and 
        Trade'' Legislation
    Climate change legislation is likely to become the biggest policy 
driver impacting future energy investments, including investment 
decisions regarding hydropower. Avista believes it is very important 
that investments made in emission-free resources such as hydropower be 
rewarded, rather than penalized, in any cap and trade legislation, or 
other climate change legislation, adopted by Congress. Therefore, 
Avista urges Congress to allocate the valuable ``emission allowances'' 
that are at the center of any cap and trade system to electric 
utilities based on their electricity output or load served, not based 
on historic greenhouse gas emissions. Avista also supports work being 
done by NHA regarding the provision of ``bonus allowances'' to 
renewable power resources such as hydropower. Allowance allocation and 
the many other highly technical provisions of the complex climate 
change legislation that Congress is considering will have a major 
impact on hydropower's future. Any climate change legislation should 
appropriately acknowledge and encourage this important resource.
C.  Removal of Regulatory Barriers to Hydropower Development
    The regulatory process for the approval of new hydropower resources 
is often costly, complex, and time consuming, and does not always 
produce reasonable outcomes. In response, Congress made significant 
improvements to the licensing process through the adoption of licensing 
reforms in the Energy Policy Act of 2005. Avista strongly supported 
these reforms.
    Avista appreciates that because hydropower relies on a public 
resource, the regulatory process must be comprehensive and inclusive so 
that all impacts and interests are fully considered. However, Congress 
should carefully monitor how the regulatory process treats the many 
conventional hydropower, pumped storage, and new hydrokinetic 
technology projects that are currently in the licensing pipeline at the 
FERC, the Departments of Interior and Commerce, and at state resource 
and water quality agencies. If the regulatory process does not result 
in the timely and reasonable approval of hydropower projects that are 
in the public interest, Congress should address this matter through 
oversight, or even legislation, if necessary.
D.  Support for Hydropower Research and Development
    Federal support for hydropower research and development (R&D) has 
been minimal to non-existent for many years. This needs to change if we 
are to tap the full potential for the use of new technology at 
conventional hydropower facilities, as well as the many benefits that 
can be obtained from the new hydrokinetic technologies. New R&D 
investments in hydropower are essential. Congress took an important 
first step in support of hydropower R&D by appropriating $10 million in 
FY 2008. Avista strongly supports NHA's efforts to expand this funding 
to $54 million in FY 2009. Hydropower needs a vigorous and well-funded 
federal energy R&D program in order to achieve its full potential.
V. CONCLUSION
    Avista deeply appreciates the opportunity to testify and commends 
the Subcommittee for its leadership on the important issue of the 
contribution of hydropower to our nation's energy future. I am happy to 
answer any questions that you may have.
                                 ______
                                 
    Mrs. Napolitano. Mr. Culbertson.

  STATEMENT OF TIM CULBERTSON, GENERAL MANAGER, GRANT COUNTY 
          PUBLIC UTILITY DISTRICT, EPHRATA, WASHINGTON

    Mr. Culbertson. Good afternoon, Madam Chairwoman, Ranking 
Member McMorris Rodgers and members of the Subcommittee.
    My name is Tim Culbertson, general manager of Public 
Utility District Number 2 in Grant County. I appreciate the 
opportunity to testify about this very important subject, and 
would like especially to recognize Ranking Member McMorris 
Rodgers for inviting me to participate today. I would also like 
to take a minute and thank the previous panelists for their 
comments and the statements they have made regarding hydro 
energy. Grant PUD is a consumer-owned utility that serves a 
rural predominantly agricultural population in central 
Washington State. Hydropower, irrigation canal hydropower and 
wind power compromise our total electric generation capacity of 
over 2,000 megawatts.
    My message today is simple: There is tremendous untapped 
emission-free hydroelectric generation potential in the United 
States. Too often hydropower is overlooked or taken for 
granted. This is an unfortunate oversight because hydropower, 
which does not generate any greenhouse gas emissions, is a 
domestic resource that deserves more attention as part of the 
Nation's renewable energy future. In 1901, Congress passed the 
first Water Power Act, enabling hydropower to make 
extraordinary contributions to our Nation's economy and 
security. With congressional assistance, hydropower capacity in 
the United States tripled between 1920 and 1940.
    Today, existing hydropower generation totals 289 million 
megawatts hours which represents 7 percent of the net energy 
generation in the United States. This equates to over 190 
million tons of avoided greenhouse gas emissions in the U.S. 
per year, yet there is more hydropower that can be readily 
developed. According to the Electric Power and Research 
Institute, the United States has the potential to develop an 
additional 10,000 megawatts from new small hydro capacity gains 
at existing hydro sites and new generation facilities at 
existing dams by 2025. Let me repeat. 10,000 megawatts of 
clean, renewable hydropower without building a single large new 
dam. This is enough renewable energy to serve Washington, D.C., 
Baltimore, Maryland, and Richmond, Virginia, combined and 
represents over 29 million tons of potential avoided greenhouse 
gas emissions per year.
    Keeping our Nation's hydropower resources operating while 
also meeting today's important environmental standards 
represents a significant investment by utilities and consumers. 
For example, the Northwest Power and Conservation Council 
estimates that consumers in the Pacific northwest have invested 
approximately $9 billion through 2006 on fish and wildlife 
recovery efforts since the passage of the Northwest Power Act 
in 1980. For our part, Grant County PUD in collaboration with 
tribes, Federal and State fish agencies and environmental 
interests have exceeded the 93 percent fish survival standard 
for spring chinook salmon at our two hydro projects on the 
Columbia River.
    In April of 2008, the Federal Energy Regulatory Commission 
unanimously approved the new 44-year license to Grant PUD. Our 
new license is living proof of the potential energy gains 
available at existing dams across the country. Our capacity is 
increasing by 138 megawatts from 1,755 to 893 megawatts as a 
result of new turbine replacements at Wanapum Dam. These hydro 
capacity and efficiency improvements ensure that more than 
1,000 average megawatts of clean, renewable hydropower along 
with substantial new natural resource protection measures 
continues for many years into the future.
    I encourage Congress to support and expand policies to 
increase domestic hydropower capacity, including research and 
development dollars. I strongly support the $54 million funding 
request for the Department of Energy's hydropower research and 
development program. This request is based on the research, 
development and deployment needs and opportunities identified 
by the Electric Power and Research Institute. For our part, 
Grant County PUD has already begun to optimize our hydropower 
resources with more efficient generating equipment. At Wanapum 
Dam we are installing new advanced hydro turbines which show a 
3 percent efficiency increase in improved fish protection. All 
10 turbines at Wanapum Dam will be replaced by the year 2014 at 
a cost of $150 million. DOE's hydropower R&D program 
contributed to the development of this new technology.
    By the way of new technologies also include new 
environmental technologies which can translate into more energy 
output from the same amount of water flow. For example, Grant 
PUD just completed the installation of a $35 million fish 
bypass system at Wanapum Dam to improve fish survival while 
reducing spill. Better fish passage technologies allow dam 
operators to potentially reduce nongenerating spills through a 
dam. The bottom line there is significant untapped emissions-
free hydroelectric generation potential in the United States.
    Working together, we can increase our Nation's domestic 
clean energy portfolio and reduce our electric sector emissions 
by nearly 10 percent. Madam Chairwoman, Ranking Member McMorris 
Rodgers and members of this Subcommittee, I thank you for your 
leadership and holding this important hearing on hydropower's 
significant role as a continued source of clean renewable 
energy. Thank you.
    Mrs. Napolitano. Thank you, Mr. Culbertson. And I am very 
pleased for the testimony given here in the Subcommittee today.
    [The prepared statement of Mr. Culbertson follows:]

             Statement of Tim Culbertson, General Manager, 
       Public Utility District No. 2 of Grant County (Grant PUD)

INTRODUCTION
    Good Afternoon.
    Madam Chairwoman, Ranking Member Cathy McMorris Rodgers and members 
of the Subcommittee, my name is Tim Culbertson, General Manager of 
Public Utility District No. 2 of Grant County (Grant PUD). I sincerely 
appreciate the opportunity to testify about this very important 
subject, and would like to especially recognize Ranking Member McMorris 
Rodgers for inviting me to participate today.
    Grant PUD is a consumer-owned utility that serves a rural, 
predominantly agricultural population in central Washington State. 
Hydropower, irrigation-canal hydropower and wind power comprise our 
total electric generation capacity of over 2,000 megawatts, which 
provides clean, emissions-free and renewable electricity for our 
state's families and businesses, including 43,000 customers in Grant 
County, as well as millions of consumers throughout the Pacific 
Northwest.
    My message today is simple--there is tremendous untapped, 
emissions-free hydro electric generation potential in the U.S.
    Too often, hydropower is overlooked or taken for granted. This is 
an unfortunate oversight because hydropower--which does not generate 
any greenhouse gas emissions--is a domestic resource that deserves more 
attention as part of the nations renewable energy supply.
HYDROPOWER IS PART OF THE SOLUTION
    In 1901, Congress passed the first Water Power Act, enabling 
hydropower to make extraordinary contributions to our nation's economy 
and security. With congressional assistance, hydropower capacity in the 
United Stated tripled between 1920 and 1940.
    Today, hydropower is the largest renewable resource in the United 
States--and there is more hydropower that can be readily obtained. 
Existing hydropower generation in the U.S. totals 289 million megawatt 
hours 1, which represents approximately seven percent of the 
net energy generation in the U.S. Domestic hydropower equates to over 
190 million tons of avoided greenhouse gas emissions in the U.S. per 
year. 2
---------------------------------------------------------------------------
    \1\ U.S. Energy Information Administration
    \2\ Based on the U.S. average emissions of 1,366 lbs/MWh
---------------------------------------------------------------------------
    According to a March 2007 report released by the Electric Power 
Research Institute (EPRI), there are 90,000 megawatts of untapped water 
power generation potential in the U.S. This could produce enough energy 
to serve the needs of 22 cities the size of Washington, DC and equates 
to over 250 million tons of potential reductions in greenhouse gas 
emissions per year that is unrealized in the U.S. 3
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    \3\ Based on 50 percent electric generating facility capacity 
factor
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    By the year 2025, EPRI reports that the U.S. has the potential to 
develop 10,000 megawatts (or 11 percent of the total above) from new 
small hydro, capacity gains at existing hydro sites and new generating 
facilities at existing dams. Let me repeat: 10,000 megawatts of clean, 
renewable hydropower without building a single large new dam. This is 
enough renewable energy to serve Washington, DC, Baltimore, MD and 
Richmond, VA, and represents over 29 million tons of potential avoided 
greenhouse gas emissions per year. 4
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    \4\ Based on 50 percent electric generating facility capacity 
factor
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HYDROPOWER'S ``FIRMING'' BENEFITS
    Building a sustainable U.S. energy future will require the use of 
all climate-friendly technologies currently available, as well as new 
and advanced hydropower technologies. Adding hydropower capacity has 
the duel benefit of providing significant and much needed ``firming'' 
support for other clean, renewable resources.
    For example, as the U.S. increases the amount of renewable 
resources in its overall portfolio, hydropower is one of the few base-
load, climate-friendly generating resources well suited to ``firming'' 
intermittent or non-dispatchable resources such as wind. Firm power is 
energy that is guaranteed to be there when you need it. As the 
development of wind, solar and other intermittent resources grows, 
hydropower is the perfect partner to ``firm'' and ``shape'' those 
resources because it can respond immediately to fluctuating electricity 
demand. In addition, today's hydro turbines convert over 90 percent of 
available energy into electricity, making it one of the most efficient 
forms of power generation. Without reliable, efficient and climate-
friendly base-load ``firming'' resources such as hydropower, the value 
of intermittent or non-dispatchable resources is greatly reduced.
ADDITIONAL BENEFITS
    Another important attribute of hydropower is that is provides 
significant peaking capacity and ancillary services to bolster the 
reliability, stability and resilience of the Nation's transmission 
system. These ancillary benefits include frequency control, load 
following, spinning reserve, supplemental reserve and black-start 
capability. The August 2003 blackout in the East Coast was a testament 
to these benefits, where hydropower projects in New York and elsewhere 
remained online and were valuable in restoring power to the region.
COMMITMENT TO ENVIRONMENTAL PROTECTION
    Keeping our Nation's hydropower resources operating while also 
meeting today's important environmental standards represents a 
significant investment by utilities and consumers. For example, 
according to the ``Sixth Annual Report to the Northwest Governors on 
Expenditures of the Bonneville Power Administration (BPA)'' by the 
Northwest Power and Conservation Council, consumers in the Pacific 
Northwest have invested approximately $9 billion through 2006 on fish 
and wildlife recovery efforts since the passage of the Northwest Power 
Act in 1980.
    For our part, Grant PUD--in collaboration with tribes, federal and 
state fish agencies and environmental interests--has met or exceeded 
the 93 percent fish passage survival standard for spring Chinook salmon 
at our two-dam Priest Rapids Project on the mid-Columbia river. In 
April 2008, the Federal Energy Regulatory Commission (FERC) unanimously 
approved a new 44-year license to Grant PUD to operate the Priest 
Rapids Project. Grant PUD's new license for the Priest Rapids Project 
is living proof of the potential gains available at existing dams 
across the country. Our capacity is increasing from 1,755 megawatts 
under the old license to 1,893 megawatts with turbine replacements at 
Wanapum Dam--an increase of 138 megawatts. These capacity and 
efficiency improvements ensure that more than 1,000 average megawatts 
of clean, renewable hydropower--along with substantial new natural 
resource protection measures--continues for many years into the future.
OPTIMIZING HYDROPOWER
    As described in the EPRI report, 10,000 megawatts of untapped small 
hydro, capacity gains from existing facilities and new generation 
facilities at existing dams can be achieved by the year 2025. However, 
that will require aggressive congressional support and expansion of 
economic incentives, such as the Production Tax Credit and Clean 
Renewable Energy Bonds program, to include all hydropower resources and 
new, advanced technologies.
    In addition, federal funding is almost non-existent for the 
Department of Energy's (DOE) Hydropower & Waterpower R&D Program. This 
program received a mere $10 million in 2008. At a minimum, $54 million 
is needed in FY 2009. This amount corresponds to the research, 
development and deployment needs and opportunities identified in the 
EPRI report.
    For our part, Grant PUD has already begun to optimize existing 
water resources with more efficient hydro generating equipment. At 
Wanapum Dam, we are installing new advanced hydropower turbines--which 
show a three percent efficiency increase and improved fish protection. 
All ten turbines at Wanapum Dam will be replaced with new, advanced 
hydro turbines by the year 2014, and at a cost of $150 million. DOE's 
hydropower R&D program contributed to the development of this new 
technology. Continued and additional federal support, in partnership 
with industry, is critical to expand the development of untapped, 
renewable hydropower resources and technologies.
    By the way, new technologies also include new environmental 
technologies, which can translate into more energy output from the same 
amount of water flow. For example, Grant PUD just completed 
installation of a $35 million fish bypass system at Wanapum Dam to 
improve survival for downstream migrating salmon. Better fish passage 
technologies allow dam operators to potentially reduce non-generating 
``spill'' through a project. As a result, more renewable energy can be 
generated using the same amount of water. We can increase both fish 
protection and renewable hydropower generation.
HYDROPOWER WORKS
    The bottom line ``reducing emissions will require federal 
partnership and support for the rapid deployment of this substantial 
untapped, renewable, emissions-free resource. Hydropower can be part of 
the domestic energy solution and is one of the few base-load, renewable 
energy sources in the U.S. that is both emissions-free and can ``firm'' 
intermittent or non-dispatchable energy, such as wind. Working 
together, we can realize hydropower's potential, increase our Nation's 
domestic clean energy portfolio and reduce our electric sector 
emissions by nearly 10 percent. 5
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    \5\ Based on 250 million tons of potential emission reductions per 
year that is unrealized in the U.S.
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    Madam Chairwoman, Ranking Member McMorris Rodgers, and members of 
the Subcommittee, I thank you for your leadership in holding this 
important hearing on hydropower's significant role as a source of 
clean, renewable energy for the future.
    Thank you.
                                 ______
                                 
    Mrs. Napolitano. Unfortunately our colleagues are off on a 
flight somewhere, where we probably will be soon.
    This is a critical issue for a lot of us, including my 
Ranking Member, for number of reasons. We need to try to begin 
assisting--we can't do it unless we have information and being 
able to see what is out there and how we can be of service to 
promote our policy that will make that available to the users.
    To all of you, I would like to hear from you in regard to 
the role that State renewable portfolio standard played in 
promoting new hydropower generation. And I am most interested 
in how Oregon, Washington and California all treat conventional 
and new hydropower differently. Yes, sir.
    Mr. Culbertson. Well, the State of Washington is 
interesting because it doesn't include traditional hydro as a 
renewable resource which we think is fundamentally wrong and 
flawed. Grant was able to actually craft an agreement with the 
sponsors of that initiative to include incremental hydro. But 
the interesting part is Grant and other non-Federal projects 
and their efficiency improvements are considered renewable, 
whereas the Federal projects are not considered renewable in 
their efficiency improvements. So we think there are some flaws 
in the State of Washington and it is only new low-impact hydro 
that is given credit as a renewable resource in the State of 
Washington.
    Mrs. Napolitano. Thank you. I think there is something this 
Subcommittee can take up. Yes, sir.
    Mr. Roos-Collins. In California, the renewable portfolio 
standard recognizes hydropower less than 30 megawatts of 
capacity as renewable. But let me approach your question from a 
different angle. The renewable portfolio standard as well as 
the related climate change legislation which Governor 
Schwarzenegger signed into law in 2006 have motivated our 
utilities as well as merchant generators to look for new 
renewables with a vigor that has never occurred before.
    And so as of this month, just to give one example, Pacific 
Gas and Electric Company has signed procurement contracts for 
1,000 or more megawatts of solar thermal capacity. That is 
approximately 1/5 of its entire hydropower system. It is 
proposing to have those contracts deliver power within 2 years, 
2 to 5 years.
    And that is just one example of how the RPS and California 
is motivating our utilities to look at hydropower as well as 
other forms of renewable to pick up the pace a bit.
    Mrs. Napolitano. Anybody else? Mr. Howard.
    Mr. Howard. I would echo what Mr. Culbertson said, and I 
would say that we are hoping that maybe some of the 
shortcomings of the RPS system, as established in Washington, 
can be improved over time. Having said that, the standards 
have--every 2 years we do an integrated resource plan where we 
re-evaluate future demands and how we are going to meet those. 
And certainly in part response to the RPS standards, we have 
indicated a higher degree of renewable development. And 
evaluating the possibility for incremental improvements in 
hydro is something we have been doing anyway. It may end up 
accelerating the rate of some projects as would obviously the 
extension of the production tax credit.
    Mrs. Napolitano. Mr. Corwin.
    Mr. Corwin. Yeah. As far as Oregon goes, renewable 
portfolio standard, similar to Washington in respect they don't 
recognize large hydro, small, low--some small-low impact and 
qualify. But actually on Richard's point, I thought teed up a 
good side to this. What we are seeing out of all of the 
renewable portfolio standards is a whole lot of wind being 
developed in the northwest. And the impacts to that on the 
hydro system are still becoming known but what we do know is, 
for example, on the Federal system there is already about 1,400 
megawatts of wind that they are integrating into that Federal 
transmission system.
    And part of this--you know, like we said, hydro matches up 
nicely to firm the wind. But the capacity of the hydro system 
is getting more and more constrained. And on the Federal hydro 
system, we lost about 1/8 of it on an average basis over 1,000 
average megawatts took constraints on the system for salmon and 
steelhead under the biological opinions which creates an even 
tighter system.
    So it is going to be a challenge moving forward because we 
are looking at the wind potentially doubling and then doubling 
again over the next 10 to 20 years here as far as the amounts 
coming online.
    Mrs. Napolitano. Thank you. Ms. McMorris Rodgers.
    Mrs. McMorris Rodgers. Thank you, Madam Chairman, several 
of you have talked about the potential for new hydropower and 
both through increased efficiency at existing facilities as 
well as the low head hydro and pump storage. I just wanted to 
ask each one of you if you might comment on your perspective as 
to what is available, what kind of research is out there and 
the potential results of this research that is taking place.
    Mr. Corwin. As far as available low head, I haven't studied 
the studies. I have seen some on the big head hydro, you know, 
they have had a program in the Federal system--Columbia system 
over time to rehabilitate several of the projects. And the 
biggest one there is at Grant Coulee, which does create a 
little more generation with the new runners coming in. So even 
without additional head you know you can get a little more 
generation out of these older facilities.
    Mr. Culbertson. And I would go back to my testimony at 
Grant. We are getting 138 megawatts of increased capacity just 
out of the Wanapum project by doing turbine upgrades alone. We 
are about to go to bid for generators, which will probably give 
us another about 50 to 70 megawatts of increased capacity with 
the generator upgrade. So figure about 200 megawatts of 
increased efficiency out of that project. As soon as we are 
done there, the plan is to go downstream to do Priest Rapids 
and get the same kind of efficiency gains out of the Priest 
Rapids project. And if in the northwest you look at most hydro 
projects, they are of the same vintage and we believe that 
there are the same kind of efficiency gains that can be gained 
at most of the hydroelectric projects, not only in the 
northwest but basically the entire west coast which are of the 
same basic vintage.
    Mr. Howard. I would just say that we focus our evaluations 
of research of course on our eight hydro developments and 
prioritize those on where we can make gains in efficiency and 
upgrades. And we are engaged in those actively right now on 
both the Clark Fork River and Spokane River. I would also add 
that you know I think one potential benefit of R&D dollars is 
maybe to help identify opportunities that may not be on our 
radar screens, but there may be a nexus with broader concerns 
about public safety and infrastructure.
    Many privately owned dams all across the country and some 
publicly owned that could potentially have power benefits and 
may be achieve both power and safety benefits simultaneously. 
And then finally, we certainly engage with folks in our service 
territory who we have other smaller dam owners, as Senator 
Morton referenced the Sheep Creek projects and others, and we 
encourage those kind of opportunities that may occur in private 
lands if they are available as they may also enhance system 
reliability.
    Mr. Roos-Collins. Since the prior answers have focused on 
inland, I will answer it with regard to ocean. The Minerals 
Management Service under the U.S. Department of the Interior 
recently published a programmatic environmental impact 
statement which looked at the potential capacity as well as the 
potential impacts of ocean energy development. The Federal 
Energy Regulatory Commission has begun to look at capacity and 
impacts in the context of individual proceedings. And other 
Federal agencies have other information they have developed 
over time with respect to other ocean uses, such as navigation 
buoys that may be applicable to hydrokinetic development on the 
ocean side.
    I would recommend to this Subcommittee that you consider 
two things to help make this information useable. First it 
would be helpful for the Federal agencies to consolidate the 
information they already have in one place so that the 
information is indeed available to guide the siting decisions. 
And second, since the marine environment is far less well 
understood than inland waters, we do need to increase the R&D 
budget specifically for monitoring so that we can understand 
impacts of any projects that we would build.
    Mrs. Napolitano. Very good. Madam Chairman, I would like to 
ask unanimous consent to submit the Northwest Power and 
Conservation Council's 2007 report on carbon dioxide footprint 
of the northwest power system and the Electric Power Research 
Institute's assessment of water power potential and development 
needs into the hearing record.
    Mrs. Napolitano. Without objection, so ordered. And I would 
like to see a copy of it so I can get briefed on some of these 
issues. I don't need it now. I would like to have it. I am on 
my way to a flight. So thank you.
    Mrs. McMorris Rodgers. Plane reading.
    Mrs. Napolitano. Reading material to put me to sleep. Thank 
you very much.
    This has been a very interesting hearing. I would have been 
out of here about 2:00, right after the last votes. But it is 
critical. And I am hoping that--thank you all of you for your 
testimony and to the prior panel. I think we have a lot of work 
ahead of us and I thank my Ranking Member for bringing it to 
our attention because sometimes party politics gets in the way. 
We are hoping that does not happen here. And we will continue 
to work on issues that are beneficial to our country rather 
than to our parties. And I say that wholeheartedly because I 
think that we need to have not only us working together with 
your help, but also the administration and the agencies that 
are charged with being able to help us see what is in the 
future. And updating, upgrading and looking at new technologies 
is an excellent idea. I think it is long overdue.
    It is always a matter of money. However, given the fact 
that we are looking at drought, at climate change, at rolling 
blackouts and many other things that are going to be upon us if 
we are not too--if we are not careful, I think we need to begin 
to be cognizant of the need to invest in some of the R&D so 
that we can move forward for our constituency.
    And Mr. Corwin, the consolidation is something that I have 
always believed is necessary and inherent in being able to do a 
good job but heaven forbid we would ask our agencies to do 
that. However we will try to be--and I do that tongue-in-cheek 
because they have worked with us. But the only problem is, 
sometimes we don't talk to each other. And even on Water 2025 
and now it is Water For America, I continually ask for them to 
let us know what is going on so that we are apprised and we 
don't spin our wheels asking agencies for things they are 
already doing in another area.
    And with that, I thank everybody. You have been great. I 
appreciate it. And that concludes the Subcommittee's oversight 
hearing on hydropower providing 75 percent of America's 
renewable energy, exploring its role as a continued source of 
clean renewable water for the future. And I mean our future.
    Our thanks to all of our witnesses for appearing before the 
Subcommittee today. Your testimonies and expertise have indeed 
been extremely enlightening and very helpful. And under 
committee rule 4(h) additional material for the record should 
be submitted within 10 business days after the hearing. That 
means anybody in the audience or any of the panelists who want 
to submit additional paper for the record, information, please 
do so. You have 10 business days. Your cooperation as witnesses 
in replying promptly to any questions submitted to you in 
writing will be very greatly appreciated. And with that, this 
hearing is adjourned.
    [Whereupon, at 4:45 p.m., the Subcommittee was adjourned.]

    [Additional material submitted for the record follows:]

    [A statement submitted for the record by Mr. Lamborn 
follows:]

 Statement of The Honorable Doug Lamborn, a Representative in Congress 
                       from the State of Colorado

    As a Coloradan and Member of Congress concerned about energy and 
our natural resources, it is vital that we make a commitment to clean, 
renewable energy sources such as hydropower. Hydropower generation is 
critical not only to the Pacific Northwest but the entire country. My 
own district benefits from no less than three such facilities. It is 
important that we preserve and increase efficiency in production of 
hydropower in the United States.
    Hydropower composes 7% of the nation's electrical generation. 
Current U.S. hydropower capacity is about 80,000 megawatts and, 
according to the Department of Energy, can produce enough electricity 
for approximately 28 million households.
    Hydropower provides a clean, relatively low-cost option for future 
renewable energy production. Because hydroelectric power is produced 
domestically, it also reduces U.S. dependency on foreign energy 
sources.
    I applaud the Chairwoman and the Ranking Member for holding this 
important hearing.

                                 
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