[Congressional Record Volume 155, Number 39 (Thursday, March 5, 2009)]
[Senate]
[Pages S2838-S2846]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REID:
  S. 539. A bill to amend the Federal Power Act to require the 
President to designate certain geographical areas as national renewable 
energy zones, and for other purposes; to the Committee on Energy and 
Natural Resources.
  Mr. REID. Mr. President, as John F. Kennedy said about 50 years ago, 
``The Chinese use two brush strokes to write the word `crisis.' One 
brush stroke stands for danger; the other for opportunity. In a crisis, 
be aware of the danger--but recognize the opportunity.''
  America has not one crisis, but at least three crises that loom large 
before us. The economy is in obvious turmoil, pollution is causing the 
climate to change, and we are far too dependent on oil, particularly 
oil from unfriendly places around the world. These challenges hamper 
our security in profound ways.
  Fortunately, with a new President and a bipartisan mandate in 
Congress, the opportunities to change direction and turn crisis into 
opportunity have never been more abundant. Now is the time to focus our 
resources on investments that will create jobs today and sustainable 
economic growth into the future.
  I know that we have the technology to use less oil tomorrow then we 
used today, and even less the day after. We can move quickly toward 
greater energy independence, but only if we make major investments now 
in clean energy, like natural gas and electric vehicles and much more 
efficient fleets, and all produced right here in America and with 
American jobs.
  President Obama's economic recovery plan is a giant step in the right 
direction. It provides $11 billion for smart grid technology and 
expanding transmission to renewable rich areas, as well as hundreds of 
millions of dollars to promote greater use of alternative fuel 
vehicles, including plug-in hybrids and fueling insfrastructure.

[[Page S2839]]

That plan is a massive infusion to help Americans become more energy 
efficient, including $300 million for energy efficient appliance 
rebates.
  But even if we stopped wasting nearly one-third of the country's 
annual current energy consumption unnecessarily spending trillions of 
dollars and sending billions of tons of pollution up into the air we 
would still need new supplies of clean energy for sustainable economic 
growth.
  Fortunately, Nevada and other parts of the desert southwest have 
enough solar energy potential to power our country seven times over. If 
that potential is combined with the wind energy from the Great Plains 
and the hundreds of thousands of megawatts of geothermal energy deep 
beneath the earth, the whole country could have cost-free fuel for many 
generations to come.
  Innovators and entrepreneurs in every state have already begun to 
harness this power. But the field is in its infancy and it will only 
mature with significant and sustained support and attention at the 
Federal level.
  But we must also focus our attention and investments on planning and 
siting new electricity transmission and breaking down barriers to a 
truly national approach. Otherwise, the vast clean renewable power in 
the sun, wind and geothermal resources of Nevada, off the country's 
coasts in the oceans, in the biomass on our lands, forests and in our 
cities, and in the remote and rural areas of the country, will never 
get to consumers.
  Our transmission system and its regulations have been built up over 
many decades with the main target of assuring reliability and 
availability. Yet the grid is still fragile and not well equipped to 
meet the demands of this century's smart technologies or our 
environmental or national security challenges.
  These issues were the topic of focused discussion last week at a 
genuinely important event a National Clean Energy Summit hosted by the 
Center for American Progress, CAP. This followed up on a similar 
gathering that I hosted in Las Vegas last August with John Podesta and 
the CAP Action Fund and the University of Nevada Las Vegas.
  Last week's event was no ordinary meeting. It was admirably moderated 
by former Senator Tim Wirth and included President William Jefferson 
Clinton, Vice President Al Gore, Energy Secretary Steven Chu, Interior 
Secretary Ken Salazar, House Speaker Nancy Pelosi, Senator Jeff 
Bingaman, Representative Ed Markey, energy executive T. Boone Pickens, 
and leaders from government, business, labor, and the non-profit 
communities.
  In particular, I would like to note the very constructive 
participation of the country's State regulatory commissions and 
authorities, ably represented by Fred Butler of New Jersey, President 
of the National Association of Regulatory Utility Commissioners. They 
have extremely difficult jobs maintaining reliability, keeping costs 
down, and being held responsible for the utilities' every move.
  The outcome of our discussion was clear--reforming our energy 
policies to build a cleaner, greener national transmission system--an 
electric superhighway--must be a top national priority. However, 
equally clear was the sense that it will not be easy and will require 
everyone to work together with common purpose and through a strong 
public-private partnership to be effective in addressing our grave 
national challenges.
  The need for reform is very clear. That is why I am introducing a 
bill today that charts a course to a cleaner, greener, and smarter 
national energy transmission system without sacrificing reliability or 
affordability. This will ensure a more secure and sustainable energy 
future for America.
  Though this bill is loosely based on my legislation from the last 
Congress, this new and broader version is the product of input and a 
shared vision from many important stakeholders. In particular, the 
Center for American Progress and the Energy Future Coalition must be 
congratulated for their hard work and leadership in this complicated 
policy area. They have helped make it understandable to many in 
Washington, D.C.
  But no one can beat T. Boone Pickens in explaining to the American 
people how critically important it is to transform the nation's 
electricity grid to accelerate the use of renewable energy. He is a 
source of immense renewable energy and really helping to drive this 
issue home.
  My legislation will require the President to designate renewable 
energy zones with significant clean energy generating potential. Then, 
a massive planning effort will begin in all the interconnection areas 
of the country to maximize the use of that renewable potential by 
building new transmission capacity. The states would propose cost 
allocation means to fund the new lines in the green transmission grid 
plans. If either process falters, then the federal government would be 
given clear authority to keep things moving and get the new 
transmission built on schedule and funded equitably.
  This bill is not perfect and has ample room for improvement. But as 
the bill works its way through the legislative process, I am hopeful 
that people will come together in good faith and propose revisions that 
will help solve the problems that we tried to identify at the Summit. 
There has already been a great deal of non-partisan, thoughtful work 
that Congress can draw upon in legislating and I look forward to the 
hearing that Chairman Bingaman has scheduled on this topic for next 
week.
  Here are just a few of the organizations that provided valuable input 
in the drafting process for this bill: The Energy Future Coalition; the 
Center for American Progress; the Pickens Plan; Energy Foundation; 
Sierra Club; Natural Resources Defense Council; National Wildlife 
Federation; Audubon Society; The Wilderness Society; Bonneville Power 
Administration; Western Area Power Administration; Tennessee Valley 
Authority; Bureau of Land Management; Federal Energy Regulatory 
Commission; Department of Energy; North American Electric Reliability 
Corporation; National Association of Regulatory Utility Commissioners; 
California PUC; Working Group for Investment in Reliable and Economic 
Electric Systems; Florida Power & Light; Midwest Independent System 
Operator; PJM Interconnection; ITC Transmission; Trans-Elect 
Transmission; Pacific Gas & Electric; American Electric Power; American 
Public Power Association; Large Public Power Council; Salt River 
Project; National Rural Electric Cooperative Association; Solar Energy 
Industries Association; Bright Source Energy; RES-Americas; American 
Wind Energy Association; Iberdrola Renewables; Colorado River Energy 
Distributors Association; Electric Power Supply Association; National 
Electrical Manufacturers Association; and many more.
  Mr. President, I ask unanimous consent that the text of the bill and 
support material be printed in the Record.
  There being no objection, the material was ordered to be placed in 
the Record, as follows:

                                 S. 539

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Clean Renewable Energy and 
     Economic Development Act''.

     SEC. 2. FINDINGS.

       Congress finds that--
       (1) electricity produced from renewable resources--
       (A) helps to reduce emissions of greenhouse gases and other 
     air pollutants;
       (B) enhances national energy security;
       (C) conserves water and finite resources; and
       (D) provides substantial economic benefits, including job 
     creation and technology development;
       (2) the potential exists for a far greater percentage of 
     electricity generation in the United States to be achieved 
     through the use of renewable resources, as compared to the 
     percentage of electricity generation using renewable 
     resources in existence as of the date of enactment of this 
     Act;
       (3) the President has set out a goal that at least 25 
     percent of the electricity used in the United States by 2025 
     come from renewable sources;
       (4) many of the best potential renewable energy resources 
     are located in rural areas far from population centers;
       (5) the lack of adequate electric transmission capacity is 
     a primary obstacle to the development of electric generation 
     facilities fueled by renewable energy resources;
       (6) the economies of many rural areas would substantially 
     benefit from the increased development of water-efficient 
     electric generation facilities fueled by renewable energy 
     resources;

[[Page S2840]]

       (7) more efficient use of existing transmission capacity, 
     better integration of resources, and greater investments in 
     distributed renewable generation and off-grid solutions may 
     increase the availability of transmission and distribution 
     capacity for adding renewable resources and help keep 
     ratepayer costs low;
       (8) the Federal Government has not adequately supported or 
     implemented an integrated approach to accelerating the 
     development, commercialization, and deployment of renewable 
     energy technologies, renewable electricity generation, and 
     transmission to bring renewable energy to market, including 
     through enhancing distributed renewable generation or through 
     vehicle and transportation sector use;
       (9) it is in the national interest for the Federal 
     Government to implement policies that would enhance the 
     quantity of electric transmission capacity available to take 
     full advantage of the renewable energy resources available to 
     generate electricity, and to more fully integrate renewable 
     energy into the energy policies of the United States, and to 
     address the tremendous national security and global warming 
     challenges of the United States; and
       (10) existing transmission planning processes are 
     fragmented across many jurisdictions, which results in 
     difficult coordination between jurisdictions, delays in 
     implementation of plans, and complex negotiations on sharing 
     of costs.

     SEC. 3. NATIONAL RENEWABLE ENERGY ZONES AND GREEN 
                   TRANSMISSION.

       (a) In General.--The Federal Power Act (16 U.S.C. 791a et 
     seq.) is amended by adding at the end the following:

   ``PART IV--NATIONAL RENEWABLE ENERGY ZONES AND GREEN TRANSMISSION

     ``SEC. 401. DEFINITIONS.

       ``In this part:
       ``(1) Biomass.--
       ``(A) In general.--The term `biomass' means--
       ``(i) any lignin waste material that is segregated from 
     other waste materials and is determined to be nonhazardous by 
     the Administrator of the Environmental Protection Agency; and
       ``(ii) any solid, nonhazardous, cellulosic material that is 
     derived from--

       ``(I) mill residue, precommercial thinnings, slash, brush, 
     or nonmerchantable material;
       ``(II) solid wood waste materials, including a waste 
     pallet, a crate, dunnage, manufacturing and construction wood 
     wastes, and landscape or right-of-way tree trimmings;
       ``(III) agriculture waste, including an orchard tree crop, 
     a vineyard, a grain, a legume, sugar, other crop byproducts 
     or residues, and livestock waste nutrients; or
       ``(IV) a plant that is grown exclusively as a fuel for the 
     production of electric energy.

       ``(B) Inclusions.--The term `biomass' includes animal waste 
     that is converted to a fuel rather than directly combusted, 
     the residue of which is converted to a biological fertilizer, 
     oil, or activated carbon.
       ``(C) Exclusions.--The term `biomass' does not include--
       ``(i) municipal solid waste from which hazardous and 
     recyclable materials have not been separated;
       ``(ii) paper that is commonly recycled; or
       ``(iii) pressure-treated, chemically-treated, or painted 
     wood waste.
       ``(2) Distributed renewable generation.--The term 
     `distributed renewable generation' means--
       ``(A) reduced electric energy consumption from the electric 
     grid because of use by a customer of renewable energy 
     generated at or near a customer site; and
       ``(B) electric energy or thermal energy production from a 
     renewable energy resource for a customer that is not 
     connected to an electric grid or thermal energy source 
     pipeline.
       ``(3) Electricity-consuming area.--The term `electricity-
     consuming area' means an area of significant electrical load.
       ``(4) Electricity from renewable energy.--The term 
     `electricity from renewable energy' means electric energy 
     generated from--
       ``(A) solar energy, wind, biomass, landfill gas, renewable 
     biogas, or geothermal energy;
       ``(B) new hydroelectric generation capacity achieved from 
     increased efficiency, or an addition of new capacity, at an 
     existing hydroelectric project; or
       ``(C) hydrokinetic energy, including--
       ``(i) waves, tides, and currents in oceans, estuaries, and 
     tidal areas;
       ``(ii) free flowing water in rivers, lakes, and streams;
       ``(iii) free flowing water in man-made channels, including 
     projects that use nonmechanical structures to accelerate the 
     flow of water for electric power production purposes; or
       ``(iv) differentials in ocean temperature through ocean 
     thermal energy conversion.
       ``(5) ERCOT.--The term `ERCOT' means the Electric 
     Reliability Council of Texas.
       ``(6) Federal land management agency.--The term `Federal 
     land management agency' means--
       ``(A) the Department of the Interior and the bureaus of the 
     Department that manage Federal land and water, including--
       ``(i) the Bureau of Land Management;
       ``(ii) the Bureau of Reclamation;
       ``(iii) the United States Fish and Wildlife Service; and
       ``(iv) the National Park Service;
       ``(B) the Forest Service of the Department of Agriculture; 
     and
       ``(C) if applicable and appropriate, the Department of 
     Defense.
       ``(7) Federal transmitting utility.--The term `Federal 
     transmitting utility' means--
       ``(A) a Federal power marketing agency that owns or 
     operates an electric transmission facility; and
       ``(B) the Tennessee Valley Authority.
       ``(8) Green transmission grid project.--
       ``(A) In general.--The term `green transmission grid 
     project' means a project for--
       ``(i) a new transmission facility rated at or above 345 
     kilovolts that is part of an Interconnection-wide plan 
     developed pursuant to section 403 for an extra high voltage 
     transmission grid to enable transmission of electricity from 
     renewable energy (including existing or projected renewable 
     generation) to electricity-consuming areas; or
       ``(ii) a new renewable feeder line that an Interconnection-
     wide plan or the Commission determines is needed to connect 
     renewable generation to the extra high voltage transmission 
     grid.
       ``(B) Inclusions.--The term `green transmission grid 
     project' includes any network upgrades associated with a 
     facility described in clause (i) or (ii) of subparagraph (A) 
     that are required to ensure the reliability or efficiency of 
     the underlying transmission network, including inverters, 
     substations, transformers, switching units, storage units, 
     and related facilities necessary for the development, siting, 
     transmission, storage, and integration of electricity 
     generated from renewable energy sources.
       ``(9) Grid-enabled vehicle.--The term `grid-enabled 
     vehicle' means an electric drive vehicle or fuel cell vehicle 
     that has the ability to communicate electronically with an 
     electric power provider or with a localized energy storage 
     system with respect to charging or discharging an onboard 
     energy storage device, such as a battery.
       ``(10) Indian land.--The term `Indian land' means--
       ``(A) any land within the limits of any Indian reservation, 
     pueblo, or rancheria;
       ``(B) any land not within the limits of any Indian 
     reservation, pueblo, or rancheria title to which was, on the 
     date of enactment of this part--
       ``(i) held in trust by the United States for the benefit of 
     any Indian tribe or individual; or
       ``(ii) held by any Indian tribe or individual subject to 
     restriction by the United States against alienation;
       ``(C) any dependent Indian community; and
       ``(D) any land conveyed to any Alaska Native corporation 
     under the Alaska Native Claims Settlement Act (42 U.S.C. 1601 
     et seq.).
       ``(11) Interconnection.--The term `Interconnection' has the 
     meaning given the term in section 215(a) of the Federal Power 
     Act (16 U.S.C. 824o(a)).
       ``(12) Load-serving entity.--The term `load-serving entity' 
     means any person, Federal, State, or local agency or 
     instrumentality, or electric cooperative that delivers 
     electric energy to end-use customers.
       ``(13) Regional planning entity.--The term `regional 
     planning entity' means an entity certified by the Commission 
     to coordinate regional planning for an Interconnection.
       ``(14) Renewable feeder line.--
       ``(A) In general.--The term `renewable feeder line' means 
     all transmission facilities and equipment within a national 
     renewable energy zone owned, controlled, or operated by a 
     transmission provider that are capable of being used to 
     deliver electricity from multiple renewable energy resources 
     to the point at which the transmission provider connects to a 
     high-voltage transmission facility.
       ``(B) Inclusions.--The term `renewable feeder line' 
     includes any associated modifications, additions, or upgrades 
     to or associated with the facilities and equipment described 
     in subparagraph (A).
       ``(C) Exclusions.--The term `renewable feeder line' does 
     not include--
       ``(i) a generator lead line capable of connecting only 1 
     generator; or
       ``(ii) equipment owned by a generator.
       ``(15) Secretary.--The term `Secretary' means the Secretary 
     of Energy.
       ``(16) Transmission provider.--The term `transmission 
     provider' means an entity that owns, controls, or operates a 
     transmission facility.

     ``SEC. 402. DESIGNATION OF NATIONAL RENEWABLE ENERGY ZONES.

       ``(a) Designations.--
       ``(1) In general.--Except as provided in paragraph (2), not 
     later than 90 days after the date of enactment of this part 
     for the Western Interconnection and not later than 270 days 
     after the date of enactment of this part for the Eastern 
     Interconnection, the President shall designate as a national 
     renewable energy zone each geographical area that, as 
     determined by the President--
       ``(A) has the potential to generate in excess of 1 gigawatt 
     of electricity (or a lower quantity of electricity determined 
     by the President) from renewable energy, a significant 
     portion of which could be generated in a rural area or on 
     Federal land within the geographical area;
       ``(B) has an insufficient level of electric transmission 
     capacity to achieve the potential described in subparagraph 
     (A); and
       ``(C) has the capability to contain additional renewable 
     energy electric generating facilities that would generate 
     electric energy consumed in 1 or more electricity-consuming 
     areas if there were a sufficient level of transmission 
     capacity.

[[Page S2841]]

       ``(2) Inclusion.--The President may include in any national 
     renewable energy zone designated under paragraph (1) a 
     military installation.
       ``(3) Exclusions.--The President shall not include in any 
     national renewable energy zone designated under paragraph (1) 
     any of the following areas:
       ``(A) National parks, national marine sanctuaries, 
     reserves, recreation areas, and other similar units of the 
     National Park System.
       ``(B) Designated wilderness, designated wilderness study 
     areas, and other areas managed for wilderness 
     characteristics.
       ``(C) National historic sites and historic parks.
       ``(D) Inventoried roadless areas and significant 
     noninventoried roadless areas within the National Forest 
     System.
       ``(E) National monuments.
       ``(F) National conservation areas.
       ``(G) National wildlife refuges and areas of critical 
     environmental concern.
       ``(H) National historic and national scenic trails.
       ``(I) Areas designated as critical habitat.
       ``(J) National wild, scenic, and recreational rivers.
       ``(K) Any area in which Federal law prohibits energy 
     development, or that the Federal agency or official 
     exercising authority over the area exempts from inclusion in 
     a national renewable energy zone through land use, planning, 
     or other public process.
       ``(L) Any area in which applicable State law enacted prior 
     to the date of enactment of this section prohibits energy 
     development.
       ``(b) Renewable Energy Requirements.--In making the 
     designations required by subsection (a), the President shall 
     take into account Federal and State requirements for 
     utilities to incorporate renewable energy as part of meeting 
     the load of load-serving entities.
       ``(c) Consultation.--Before making any designation under 
     subsection (a) or (e), the President shall consult with--
       ``(1) the Governors of affected States;
       ``(2) the public;
       ``(3) Federal transmitting utilities, public utilities and 
     transmission providers, and cooperatives;
       ``(4) State regulatory authorities and regional electricity 
     planning organizations;
       ``(5) Federal land management agencies, Federal energy and 
     environmental agencies, and State land management, energy, 
     and environmental agencies;
       ``(6) renewable energy companies;
       ``(7) local government officials;
       ``(8) renewable energy and energy efficiency interest 
     groups;
       ``(9) Indian tribes; and
       ``(10) environmental protection and land, water, and 
     wildlife conservation groups.
       ``(d) Recommendations.--Not earlier than 3 years after the 
     date of enactment of this part, and triennially thereafter, 
     the Secretary and the Secretary of the Interior shall, after 
     consultation with the Federal transmitting utilities, the 
     Commission, the Chief of the Forest Service, the Secretary of 
     Commerce, the Secretary of Defense, the Council on 
     Environmental Quality, and the Governors of the States, shall 
     recommend to the President and Congress--
       ``(1) specific areas with the greatest potential for 
     environmentally acceptable renewable energy resource 
     development that the President could designate as renewable 
     energy zones, considering such factors as the impact on 
     sensitive wildlife species, the impact on sensitive resource 
     areas, and the presence of already disturbed or developed 
     land; and
       ``(2) any modifications of laws (including regulations) and 
     resource management plans necessary to fully achieve that 
     potential, including identifying improvements to permit 
     application processes involving military and civilian 
     agencies.
       ``(e) Existing Processes.--In carrying out this section, 
     the President may use existing processes that designate 
     renewable energy zones.
       ``(f) Revision of Designations.--The President may modify 
     the designation of renewable energy zones, including 
     modification based on the recommendations received under 
     subsection (d).
       ``(g) Election.--The ERCOT Interconnection may elect to 
     participate in the process described in this section.
       ``(h) Administration.--The designation of a renewable 
     energy zone shall not be considered a major Federal action 
     under Federal law.
       ``(i) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section (including 
     renewable energy resource assessments) $25,000,000 for each 
     of fiscal years 2009 through 2019.

     ``SEC. 403. INTERCONNECTION-WIDE GREEN TRANSMISSION GRID 
                   PROJECT PLANNING.

       ``(a) In General.--To achieve Interconnection-wide 
     coordination of planning to integrate renewable energy 
     resources from renewable energy zones into the interstate 
     electric transmission grid and make the renewable energy 
     resources fully deliverable to electricity consuming areas, 
     not later than 60 days after the date of enactment of this 
     part, the Commission shall, by regulation or order, issue a 
     request for 1 or more organizations to be certified as the 
     regional planning entity for each Interconnection.
       ``(b) Contents of Application.--The application shall 
     include proposals for provisions for an open, inclusive, 
     transparent, and nondiscriminatory planning process that--
       ``(1) includes consultation with affected Federal land 
     management agencies and States within the Interconnection;
       ``(2) builds on planning undertaken by States, Federal 
     transmitting utilities, regional transmission organizations, 
     independent system operators, utilities, and other interested 
     parties;
       ``(3) takes account of corridor designation work and other 
     planning carried out by Federal land management agencies, the 
     Department of Energy, and other interested parties;
       ``(4) solicits input from transmission owners, regional 
     transmission organizations, independent system operators, 
     States, generator owners, prospective developers of new 
     transmission and generation resources, regional entities, 
     Federal land management agencies, environmental protection 
     and land, water, and wildlife conservation groups, and other 
     interested parties; and
       ``(5) includes an interim process to expeditiously evaluate 
     whether new renewable feeder lines should be added to the 
     green transmission grid project plan.
       ``(c) Designation.--Not later than 120 days after the date 
     of enactment of this part, the Commission shall designate 1 
     or more appropriate organizations to serve as the regional 
     planning entity to represent the Interconnection under this 
     part.
       ``(d) Interconnection-Wide Green Transmission Grid Project 
     Plan.--Not later than 1 year after the date of the deadline 
     for designations under section 402(a), the regional planning 
     entity in each Interconnection shall produce and submit to 
     the Commission an Interconnection-wide green transmission 
     grid project plan.
       ``(e) Term; Requirements.--An Interconnection-wide green 
     transmission grid project plan shall--
       ``(1) enhance transmission access for electricity from 
     renewable energy in renewable energy zones;
       ``(2) include identification of green transmission grid 
     projects (both high-voltage and renewable feeder lines) 
     needed to interconnect renewable energy zones with 
     electricity-consuming areas;
       ``(3) fully consider national reliability, economic, 
     environmental, and security needs;
       ``(4) take into account transmission infrastructure 
     required for efficient and reliable delivery of the output of 
     new renewable generation resources needed to meet established 
     and projected Federal and State renewable energy policies and 
     targets;
       ``(5) provide a plan for a period of at least 10 years into 
     the future;
       ``(6) consider alternatives to new transmission, including 
     energy efficiency, demand response, energy storage, and 
     distributed renewable generation;
       ``(7) include a timeline for construction of projects; and
       ``(8) be filed with the Commission annually for approval 
     consistent with this section.
       ``(f) Participation of Secretary.--The Secretary shall 
     provide technical expertise to States and regional planning 
     entities in development of Interconnection-wide plans 
     through--
       ``(1) analysis for the green transmission grid project 
     planning process; and
       ``(2) demonstration and commercial application activities 
     of new technologies in the green transmission grid project 
     plan.
       ``(g) Participation of Federal Transmitting Utilities.--
       ``(1) In general.--A Federal transmitting utility shall 
     participate in the planning process in the applicable 
     Interconnection.
       ``(2) Green transmission grid project facilities.--Not 
     later than 1 year after the date a regional planning entity 
     files a plan, a Federal transmitting utility that owns or 
     operates 1 or more electric transmission facilities in a 
     State with a national renewable energy zone shall identify 
     specific green transmission grid project facilities that are 
     required to substantially increase the generation of 
     electricity from renewable energy in the national renewable 
     energy zone.
       ``(h) Failure to Submit Plan.--
       ``(1) In general.--If a State in an Interconnection does 
     not participate in a timely manner in an Interconnection-wide 
     green transmission grid project planning process in 
     accordance with this section, or if such a planning process 
     is established but fails to result in the submission by the 
     regional planning entity of the requisite components of the 
     Interconnection-wide green transmission grid project plan by 
     the date specified in subsection (d), the Commission shall 
     develop through a rulemaking, after consultation with the 
     Secretary, Federal transmitting utilities, the Secretary of 
     the Interior, regional transmission organizations, the 
     electric reliability organization, regional entities, and 
     municipal and cooperative entities, an Interconnection-wide 
     green transmission grid project plan on behalf of the 1 or 
     more nonsubmitting States or regional planning entity in the 
     Interconnection.
       ``(2) Deadline.--Any final rule required under paragraph 
     (1) shall be completed not later than 1 year after the date 
     on which the Commission determines that--
       ``(A) the regional planning entity has failed to submit an 
     Interconnection-wide green transmission project plan on a 
     timely basis; or
       ``(B) a State has failed to participate in a timely manner 
     in the planning process.
       ``(i) Evaluation and Recommendations.--The Commission 
     shall--
       ``(1) periodically evaluate whether green transmission grid 
     projects to enable the delivery of renewable energy are being 
     constructed in accordance with the Interconnection-wide green 
     transmission grid project

[[Page S2842]]

     plan for both the Western and Eastern Interconnections;
       ``(2) take any necessary actions to address any identified 
     obstacles to investment, siting, and construction of projects 
     identified as needed under an Interconnection-wide plan; and
       ``(3) not later than 2 years after the date of enactment of 
     this part, submit to Congress recommendations for any further 
     actions or authority needed to ensure the effective and 
     timely development of transmission infrastructure necessary 
     to ensure the integration and deliverability of renewable 
     energy from renewable energy zones to electricity-consuming 
     areas in the United States.
       ``(j) Recovery of Costs Associated With Interconnection-
     Wide Green Transmission Grid Project Planning.--
       ``(1) In general.--A regional planning entity and a State 
     shall be permitted to recover prudently incurred costs to 
     carry out Interconnection-wide planning activities required 
     under this section pursuant to a Federal transmission 
     surcharge that will be established by the Commission for the 
     purposes of carrying out this section.
       ``(2) Surcharge.--A regional planning entity, in 
     consultation with States in an Interconnection, shall--
       ``(A) recommend the Federal transmission surcharge based on 
     a formula rate that is submitted to the Commission for 
     approval; and
       ``(B) adjust the formula and surcharge on an annual basis.
       ``(3) Cost responsibility.--Cost responsibility under the 
     surcharge shall be assigned based on energy usage to all 
     load-serving entities within the United States portion of the 
     Eastern and Western Interconnections.
       ``(4) Limitation.--The total amount of surcharges that may 
     be imposed or collected nationally under this subsection 
     shall not exceed $80,000,000 in any calendar year.
       ``(5) Distribution.--The Secretary shall, in accordance 
     with the regulations promulgated under paragraph (1), 
     distribute on an equitable basis funds received under that 
     paragraph among States and planning entities, if the Governor 
     of the receiving State--
       ``(A) in the case of the first year of distribution, 
     certifies to the Secretary that the State will participate in 
     an Interconnection-wide green transmission grid project 
     planning process; and
       ``(B) in the case of the second and subsequent years of 
     distribution--
       ``(i) is part of an Interconnection-wide planning process 
     that submits to the Commission timely Interconnection-wide 
     green transmission grid project plans under this section; and
       ``(ii) certifies annually to the Secretary that all load-
     serving entities in the State--

       ``(I) offer a fairly-priced renewable power purchase option 
     to all the customers of the entities; or
       ``(II) have demonstrated an increase in the number of 
     customers above the previous year participating in a demand-
     side management program that reduces peak demand, increases 
     reliability, and reduces consumer costs.

       ``(6) Applicability.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), 
     this subsection applies to all users, owners, and operators 
     of the bulk-power system within the United States portion of 
     the Eastern and Western Interconnections.
       ``(B) Exclusions.--This subsection does not apply to the 
     State of Alaska or Hawaii or to the ERCOT, unless the State 
     or ERCOT voluntarily elects to participate in the planning 
     process, and to be responsible for a pro rata portion of the 
     Federal transmission surcharge imposed under this subsection.
       ``(C) Project developers.--Nothing in this section or part 
     prevents a project developer from carrying out a transmission 
     project to enable renewable development if the project 
     developer assumes all of the risk and cost of the proposed 
     project.

     ``SEC. 404. FEDERAL SITING OF GREEN TRANSMISSION GRID PROJECT 
                   FACILITIES.

       ``(a) In General.--The Commission, after consultation with 
     affected States, may issue 1 or more permits for the 
     construction or modification of an electric transmission 
     facility if the Commission finds that--
       ``(1) the transmission facility--
       ``(A) is included in an Interconnection-wide green 
     transmission grid project plan submitted under section 403; 
     or
       ``(B) is proposed by a project developer to integrate 
     renewable energy resources from renewable energy zones or to 
     integrate renewable resources from other geographic areas, if 
     the project developer assumes all of the risk and cost of the 
     proposed facilities;
       ``(2) the transmission facility optimizes transmission 
     capability based on the assessment by the Commission of 
     technical constraints, project economics, land use 
     limitations, and the potential generation capacity of 
     renewable energy zones interconnected to the project; and
       ``(3) the owner or operator of the transmission facility 
     has failed to make reasonable progress in siting the facility 
     based on timelines in the plan.
       ``(b) Evidence of Need.--Inclusion of a project in an 
     Interconnection-wide green transmission grid project plan 
     submitted under section 403 shall be considered to be 
     sufficient evidence of need for the project to warrant the 
     granting of a construction permit under subsection (a).
       ``(c) Permit Application.--
       ``(1) In general.--A permit application under subsection 
     (a) shall be made in writing to the Commission.
       ``(2) Administration.--The Commission shall promulgate 
     regulations specifying--
       ``(A) the form of the application;
       ``(B) the information to be contained in the application; 
     and
       ``(C) the manner of service of notice of the permit 
     application on interested persons.
       ``(d) Granting of Construction Permit.--
       ``(1) In general.--A construction permit may be issued to 
     any applicant described in subsection (a)(1)(B) if the 
     Commission finds that--
       ``(A) the applicant is able and willing to take actions and 
     perform the services proposed in accordance with this part 
     (including the requirements, rules, and regulations of the 
     Commission under this part); and
       ``(B) the proposed operation, construction, or expansion is 
     or will be required by the present or future public 
     convenience and necessity.
       ``(2) Administration.--The Commission shall have the power 
     to attach to the issuance of the construction permit, and to 
     the exercise of rights granted under the permit, such 
     reasonable terms and conditions as the public convenience and 
     necessity may require.
       ``(e) Construction Permit for an Area Already Being 
     Served.--Nothing in this section limits the power of the 
     Commission to grant construction permits for service of an 
     area already being served by another transmission provider.
       ``(f) Rights-of-Way.--
       ``(1) In general.--In the case of a permit under subsection 
     (a) for an electric transmission facility to be located on 
     property other than property owned by the United States, if 
     the permit holder cannot acquire by contract, or is unable to 
     agree with the owner of the property to the compensation to 
     be paid for, the necessary right-of-way to construct or 
     modify the transmission facility, the permit holder may 
     acquire the right-of-way by the exercise of the right of 
     eminent domain in the United States district court for the 
     district in which the property concerned is located, or in 
     the appropriate court for the State in which the property is 
     located.
       ``(2) Use.--Any right-of-way acquired under paragraph (1) 
     shall be used exclusively for the construction, modification, 
     operation, or maintenance of an electric transmission 
     facility, and any appropriate mitigation measures or other 
     uses approved by the Commission, within a reasonable period 
     of time after acquisition of the right-of-way.
       ``(3) Practice and procedure.--The practice and procedure 
     in any action or proceeding under this subsection in the 
     United States district court shall conform, to the maximum 
     extent practicable, to the practice and procedure in a 
     similar action or proceeding in the courts of the State in 
     which the property is located.
       ``(4) Limitations.--
       ``(A) In general.--Nothing in this subsection authorizes 
     the use of eminent domain to acquire a right-of-way for any 
     purpose other than the construction, modification, operation, 
     or maintenance of an electric transmission facility included 
     in a green transmission grid project plan or related 
     facility.
       ``(B) Administration.--The right-of-way--
       ``(i) shall not be used for any purpose not described in 
     subparagraph (A) or paragraph (2); and
       ``(ii) shall terminate on the termination of the use for 
     which the right-of-way is acquired.
       ``(g) State Authority.--
       ``(1) In general.--Except as provided in paragraph (3), in 
     granting a construction permit under subsection (a), the 
     Commission shall--
       ``(A) permit State regulatory agencies to identify siting 
     constraints and mitigation measures, based on habitat 
     protection, environmental considerations, or cultural site 
     protection; and
       ``(B)(i) incorporate those identified constraints or 
     measures in the construction permit; or
       ``(ii) if the Commission determines that such a constraint 
     or measure is inconsistent with the purposes of this part, 
     infeasible, or not cost-effective--
       ``(I) consult with State regulatory agencies to seek to 
     resolve the issue; and
       ``(II) incorporate into the construction permit such siting 
     constraints and mitigation measures as are determined to be 
     appropriate by the Commission, based on consultation by the 
     Commission with State regulatory agencies, the purposes of 
     this part, and the record before the Commission.
       ``(2) Nonadoption of recommendations.--If, after taking the 
     actions required under paragraph (1), the Commission does not 
     adopt in whole or in part a recommendation of an agency, the 
     Commission shall publish a statement of a finding that the 
     adoption of the recommendation is infeasible, not cost-
     effective, or inconsistent with this part or other applicable 
     provisions of law.
       ``(3) Interconnection-wide green transmission grid project 
     planning process.--The Commission shall not be required to 
     include constraints or measures described in paragraph (1) 
     that are identified by a State that does not participate in 
     an Interconnection-wide green transmission grid project 
     planning process under section 403.
       ``(h) Environmental Reviews.--
       ``(1) In general.--With respect to any project or group of 
     projects for which a construction permit is granted under 
     subsection (a), the Commission shall--

[[Page S2843]]

       ``(A) serve as the lead agency for purposes of coordinating 
     any Federal authorizations and environmental reviews or 
     analyses required for the project, including those required 
     under the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.);
       ``(B) in consultation with other affected agencies, prepare 
     a single environmental review document that would be used as 
     the basis for all decisions under Federal law relating to the 
     proposed project, in accordance with section 216(h) of this 
     Act, including siting constraints and mitigation measures;
       ``(C) not later than 90 days after the date of filing of an 
     application for a permit under this section, enter into a 
     memorandum of understanding with affected Federal agencies to 
     carry out this subsection, including--
       ``(i) a schedule for environmental review and a budget 
     necessary to comply with the schedule for each project or 
     group of projects; and
       ``(ii) the budget resources necessary to carry out the 
     memorandum; and
       ``(D) ensure that, once an application has been submitted 
     with such data as the Commission considers to be necessary, 
     all permit decisions and related environmental reviews under 
     applicable Federal laws shall be completed not later than 1 
     year after the date of submission of a complete application.
       ``(2) Appeal.--If any Federal agency has denied a Federal 
     authorization required for a certified project under this 
     part or has failed to determine whether to issue the 
     authorization not later than 1 year after the date of 
     submission of a complete application, the applicant or any 
     State in which the facility would be located may file an 
     appeal with the President, who shall, in consultation with 
     the affected agency, review the denial or failure to take 
     action on the pending application.
       ``(i) Restricted Areas.--In granting a construction permit 
     under subsection (a), the Commission shall consider and, to 
     the maximum extent practicable, select alternative routes to 
     avoid areas described in section 402(a)(3).
       ``(j) Access to Transmission.--
       ``(1) In general.--Subject to paragraph (2), the owner or 
     operator of any project described in subsection (a) that 
     traverses multiple States that participate in an 
     Interconnection-wide green transmission grid project planning 
     process under section 403 shall ensure that each State in 
     which the green transmission grid project traverses shall 
     have access to transmission under the project, unless the 
     access would make the project technically or economically 
     impractical.
       ``(2) Additional funds.--If a project owner or operator 
     described in paragraph (1) cannot make the assurances 
     described in that paragraph for a State, the State shall be 
     eligible for additional funds under section 405.
       ``(k) Minimum Renewable Requirement.--
       ``(1) In general.--Except as provided in paragraphs (2) and 
     (3), the transmission provider for a green transmission grid 
     project sited through the granting of a construction permit 
     under subsection (a) shall certify annually to the 
     Commission, in accordance with regulations promulgated by the 
     Commission, that at least 75 percent of the transmission 
     capacity of the project is available to renewable resources.
       ``(2) Application.--The requirements shall be applicable 
     only to generators directly interconnecting to the project.
       ``(3) Adjustment.--
       ``(A) In general.--Subject to subparagraph (B), the 
     Commission may reduce the minimum percentage specified in 
     paragraph (1) in any case in which the Commission determines 
     that it is necessary for a specific renewable feeder line to 
     have less than 75 percent of generation resources 
     interconnecting to the renewable feeder line be renewable 
     resources in order to maintain compliance with Commission-
     approved reliability standards.
       ``(B) Cost-effective energy storage options.--In making a 
     determination on a reduction for a proposed project under 
     subparagraph (A), the Commission shall consider cost-
     effective energy storage options in the area covered by the 
     project, including detailed reports developed by the project 
     developer or interconnecting generators at the direction of 
     the Commission.
       ``(l) Firm Transmission Rights.--The Commission shall 
     adopt, by rule, regulations requiring transmission providers 
     to offer, on a priority basis, firm or equivalent financial 
     transmission rights for any green transmission grid project 
     sited under this section for transmission of energy from 
     renewable resources to a load-serving entity that contracts 
     to purchase renewable resources, or to renewable energy 
     generation owners.
       ``(m) Administration.--Nothing in this section waives the 
     application of any applicable Federal environmental law.
       ``(n) State Siting Authority.--Nothing in this section 
     precludes a transmission project developer from seeking 
     siting authority from a State.

     ``SEC. 405. GRANTS FOR INTERCONNECTION-WIDE GREEN 
                   TRANSMISSION GRID PROJECT PLANS.

       ``(a) In General.--The Secretary, in consultation with the 
     Commission, shall make grants to States and planning entities 
     that submit or implement Interconnection-wide green 
     transmission grid project plans required to be developed 
     pursuant to this part in a timely manner for (as 
     appropriate)--
       ``(1) implementation of sections 403 and 404;
       ``(2) transmission improvements (including smart grid 
     investments) for States and planning entities that meet 
     deadlines in implementing those plans;
       ``(3) training for State regulatory authority staff and 
     local workforces relating to renewable generation resources, 
     smart grid, or new transmission technologies;
       ``(4) mitigation of landowner concerns and impacts;
       ``(5) habitat and wildlife conservation;
       ``(6) security upgrades to the transmission system and 
     authorized uses under title XIII of the Energy Independence 
     and Security Act of 2007 (15 U.S.C. 17381 et seq.);
       ``(7) energy storage, reliability, or distributed renewable 
     generation projects; and
       ``(8) other programs and projects that are consistent with 
     the purposes of this part.
       ``(b) Authorization of Appropriations.--There is authorized 
     to be appropriated to carry out this section $500,000,000, 
     including amounts made available--
       ``(1) under the American Recovery and Reinvestment Act of 
     2009; or
       ``(2) through the sale of carbon allowances in a law 
     enacted after the date of enactment of this Act that imposes 
     a limitation on greenhouse gas emissions.

     ``SEC. 406. COST ALLOCATION.

       ``(a) In General.--As part of an Interconnection-wide green 
     transmission grid project plan submitted under section 403, 
     the regional planning entity, after consultation with 
     affected State regulatory authorities, shall file with the 
     Commission under this section a cost allocation plan for 
     sharing the costs of developing and operating green 
     transmission grid projects that are identified and built 
     pursuant to an Interconnection-wide green transmission 
     project plan to enable delivery of electric energy from 
     renewable energy resources in renewable energy zones.
       ``(b) Approval.--Not later than 90 days after the date of 
     filing, the Commission shall approve a cost allocation plan 
     proposed under subsection (a) unless the Commission 
     determines that--
       ``(1) taking into account the users of the transmission 
     facilities, the plan will result in rates that are unduly 
     discriminatory or preferential or are not just and 
     reasonable;
       ``(2) the plan would unduly inhibit the development of 
     renewable energy electric generation projects; or
       ``(3) the plan would not allow the transmission provider 
     providing service over the facilities or the entity 
     constructing or financing the project, as appropriate, the 
     opportunity to recover prudently incurred costs, including a 
     reasonable return on investment, associated with the 
     transmission facilities the transmission provider has 
     committed to build pursuant to the Interconnection-wide green 
     transmission plan.
       ``(c) Failure to Submit a Cost Allocation Plan.--
       ``(1) In general.--If a regional planning entity is unable, 
     for whatever reason, to develop and propose an acceptable 
     cost allocation plan at the time the regional planning entity 
     files an Interconnection-wide green transmission grid project 
     plan, the Commission shall institute, on the motion of the 
     Commission, a proceeding to initially allocate the costs of 
     new transmission facilities built pursuant to an 
     Interconnection-wide green transmission project plan.
       ``(2) Cost allocation.--The Commission shall allocate the 
     costs of green transmission grid projects--
       ``(A) broadly to all load-serving entities in the 
     Interconnection; or
       ``(B) to load-serving entities within a part of the 
     Interconnection.
       ``(3) Renewable feeder lines.--
       ``(A) In general.--A renewable feeder line may be included 
     in a broad cost allocation if the Commission finds that the 
     renewable feeder line--
       ``(i) would be used by renewable energy resources remote 
     from existing transmission and load centers;
       ``(ii) will likely result in multiple individual renewable 
     energy electric generation projects being developed by 
     multiple competing developers; and
       ``(iii) has at least 1 project subscribed through an 
     executed generator Interconnection agreement with the 
     transmission provider and has tangible demonstration of 
     additional interest.
       ``(B) New renewable generation projects.--
       ``(i) In general.--As new renewable generation projects are 
     constructed and interconnected to a renewable feeder line 
     under subparagraph (A), the 1 or more new transmission 
     services contract holders shall be liable for a pro rata 
     share of the facility costs of the transmission grid project.
       ``(ii) Transmission revenues.--The transmission revenues 
     shall be applied as a credit to the initial allocation of 
     project costs.
       ``(d) Cost Allocation Rate Filings.--If a cost allocation 
     plan is approved by the Commission in accordance with this 
     section--
       ``(1) any public utility that has rates that are affected 
     by the approved cost allocation plan shall file the 
     allocation plan with the Commission pursuant to section 205; 
     and
       ``(2) the cost allocation plan shall be presumed lawful 
     under section 205 on filing, without notice or further 
     opportunity for comment or hearing.
       ``(e) Applicability.--
       ``(1) In general.--Except as provided in paragraph (3), the 
     authority of the Commission under this section and section 
     403 to approve transmission plans and to allocate costs 
     incurred pursuant to the plans applies to all transmission 
     providers, generators, and users, owners, and operators of 
     the

[[Page S2844]]

     power system within the Eastern and Western Interconnections 
     of the United States, including entities described in section 
     201(f).
       ``(2) Regional planning entities.--The Commission shall 
     have authority over regional planning entities to the extent 
     necessary to carry out this section and section 403.
       ``(3) Exclusions.--
       ``(A) In general.--This section does not apply in the State 
     of Alaska or Hawaii or to the ERCOT, unless the State or 
     ERCOT voluntarily elects to participate in a cost allocation 
     plan under this section.
       ``(B) Existing cost allocation agreements.--A project for 
     which a cost allocation or cost recovery agreement was 
     accepted by the Commission before the date of enactment of 
     this part shall not be included in cost allocation under this 
     section.

     ``SEC. 407. FEDERAL TRANSMITTING UTILITIES ENCOURAGING CLEAN 
                   ENERGY DEVELOPMENT IN NATIONAL RENEWABLE ENERGY 
                   ZONES.

       ``(a) Lack of Private Funds.--If, by the date that is 3 
     years after the date of enactment of this part, no privately-
     funded entity has committed to financing (through self-
     financing or through a third-party financing arrangement with 
     a Federal transmitting utility) to ensure the construction 
     and operation of a green transmission grid project (which the 
     Commission has identified as an essential part of an 
     Interconnection-wide green transmission project plan) by a 
     specified date, the Federal transmitting utility responsible 
     for the identification under section 403(d) shall finance 
     such a transmission facility if the Federal transmitting 
     utility has sufficient bonding authority under subsection 
     (b).
       ``(b) Bonding Authority.--
       ``(1) In general.--In addition to any other authority to 
     issue and sell bonds, notes, and other evidence of 
     indebtedness, a Federal transmitting utility may issue and 
     sell bonds, notes, and other evidence of indebtedness in an 
     amount not to exceed, at any 1 time, an aggregate outstanding 
     balance of $10,000,000,000, to finance the construction of 
     transmission facilities described in subsection (a) for the 
     principal purposes of--
       ``(A) increasing the generation of electricity from 
     renewable energy; and
       ``(B) conveying that electric energy to an electricity-
     consuming area.
       ``(2) Recovery of costs.--A Federal transmitting utility 
     shall recover the costs of green transmission grid project 
     facilities financed pursuant to subsection (a) from entities 
     using the transmission facilities over a period of 50 years.
       ``(3) Nonliability of certain customers.--Individuals and 
     entities that, as of the date of enactment of this part, are 
     customers of a Federal transmitting utility shall not be 
     liable for the costs, in the form of increased rates charged 
     for electric energy or transmission, of green transmission 
     grid project facilities constructed pursuant to this section, 
     except to the extent the customers are treated in a manner 
     similar to all other users of the green transmission grid 
     project facilities.

     ``SEC. 408. FEDERAL POWER MARKETING AGENCIES.

       ``(a) Promotion of Renewable Energy and Energy 
     Efficiency.--Each Federal transmitting utility shall--
       ``(1) identify and take steps to promote energy 
     conservation and renewable energy electric resource 
     development in the regions served by the Federal transmitting 
     utility; and
       ``(2) identify opportunities to promote the development of 
     facilities generating electricity from renewable energy on 
     Indian land within the service territory of the Federal 
     transmitting utility.
       ``(b) Wind Integration Programs.--The Bonneville Power 
     Administration and the Western Area Power Administration 
     shall each establish a program focusing on the improvement of 
     the integration of wind energy into the transmission grids of 
     those Administrations through the development of transmission 
     products, including through the use of Federal hydropower 
     resources, that--
       ``(1) take into account the intermittent nature of wind 
     electric generation; and
       ``(2) do not impair electric reliability.
       ``(c) Solar Integration Program.--Each of the Federal Power 
     Marketing Administrations and the Tennessee Valley Authority 
     shall establish a program to carry out projects focusing on 
     the integration of solar energy, through photovoltaic, 
     concentrating solar power systems and other forms and 
     systems, into the respective transmission grids and into 
     remote and distributed applications in the respective service 
     territories of the Federal Power Marketing Administrations 
     and Tennessee Valley Authority, that--
       ``(1) take into account the solar energy cycle;
       ``(2) consider the appropriate use of Federal land for 
     generation or energy storage, where appropriate; and
       ``(3) do not impair electric reliability.
       ``(d) Geothermal Integration Program.--The Bonneville Power 
     Administration and the Western Area Power Administration 
     shall establish a joint program to carry out projects 
     focusing on the development and integration of geothermal 
     energy and enhanced geothermal system resources into the 
     respective transmission grids of the Bonneville Power 
     Administration and the Western Area Power Administration, as 
     well as non-grid, distributed applications in those service 
     territories, including projects combining geothermal energy 
     resources with biofuels production or other industrial or 
     commercial uses requiring process heat inputs, that--
       ``(1) consider the appropriate use of Federal land for the 
     projects and activities;
       ``(2) displace fossil fuel baseload generation or petroleum 
     imports; and
       ``(3) do not impair electric reliability.
       ``(e) Renewable Electricity and Energy Security Projects.--
       ``(1) In general.--The Federal transmitting utilities, 
     shall, in consultation with the Commission, the Secretary, 
     the States, and such other individuals and entities as are 
     necessary, undertake geographically diverse projects within 
     the respective service territories of the Federal 
     transmitting utilities to acquire and demonstrate grid-
     enabled and nongrid-enabled plug-in electric and plug-in 
     hybrid electric vehicles and related technologies as part of 
     their fleets of vehicles.
       ``(2) Increase in renewable energy use.--To the maximum 
     extent practicable, each project conducted pursuant to any of 
     subsections (b) through (d) shall include a component to 
     develop vehicle technology, utility systems, batteries, power 
     electronics, or such other related devices as are able to 
     substitute, as the main fuel source for vehicles, 
     transportation-sector petroleum consumption with electricity 
     from renewable energy sources.
       ``(f) Reregulating Dams and Pumped Storage Study.--The 
     Secretary of the Interior and the Secretary of the Army 
     (acting through Chief of Engineers), in consultation with the 
     Secretary of Energy, shall--
       ``(1) study the potential for reregulating facilities and 
     pumped storage units at Federal dams to identify the 
     facilities and units that are most worthy of further 
     evaluation; and
       ``(2) submit to Congress a report on the results of the 
     study, including recommendations on the next steps that 
     should be taken.
       ``(g) Wind or Solar-hydro Integration Demonstration 
     Project.--
       ``(1) In general.--The Western Area Power Administration 
     may fund the construction of wind or solar generation to 
     supply firming energy to Western Area Power Administration to 
     test the economic feasibility of wind-hydro or solar-hydro 
     integration.
       ``(2) Tribal land.--In carrying out this subsection, the 
     Western Area Power Administration shall consider locating the 
     wind or solar generation facilities on tribal land.
       ``(3) Nonreimbursable costs.--All costs associated with a 
     demonstration under this subsection shall be considered 
     nonreimbursable to electric energy customers of the Western 
     Area Power Administration.

     ``SEC. 409. SOLAR ENERGY RESERVE PILOT PROJECT.

       ``(a) Purpose.--The purpose of this section is to establish 
     a solar energy reserve pilot program on Federal land for the 
     advancement, development, assessment, and installation of 
     commercial utility-scale solar electric energy systems that 
     will function as a potential model for the future development 
     of renewable energy zones identified under this Act.
       ``(b) Site Selection.--The Secretary of Energy and the 
     Secretary of the Interior, in consultation with the Secretary 
     of Defense, the Commission, States, and tribal and local 
     units of government (as appropriate), shall--
       ``(1) identify 1 or more areas of Federal land under the 
     jurisdiction of the Bureau of Land Management or land 
     withdrawn by the Secretary of Energy for other purposes that 
     is feasible and suitable for the installation of solar 
     electric energy systems that are sufficient to generate not 
     less than 4 gigawatts and not more than 25 gigawatts;
       ``(2) not later than 180 days after the date of enactment 
     of this part, initiate the process for withdrawal of 1 or 
     more tracts of land to the Secretary of Energy pursuant to 
     section 204 of the Federal Land Policy and Management Act of 
     1976 (43 U.S.C. 1714) for the purpose of creating solar 
     energy reserves or the designation of land withdrawn to the 
     Secretary of Energy for other purposes as a solar energy 
     reserve; and
       ``(3) identify the needed transmission upgrades to connect 
     the solar energy reserves to the transmission grid.
       ``(c) Ineligible Federal Land.--A solar energy reserve 
     shall not be established under this section on any land 
     excluded for designation under section 402(a)(2).
       ``(d) Development Within Reserves.--The Secretary of Energy 
     shall--
       ``(1) have the sole authority to issue land use 
     authorizations for land withdrawn under subsection (b);
       ``(2) establish criteria for approving applications and 
     developing infrastructure for solar reserves;
       ``(3) not later than 2 years after the date of enactment of 
     this part, work with Federal agencies, States, and other 
     interested persons to ensure, to the maximum extent 
     practicable, that adequate infrastructure is available for 
     operation of the first solar energy reserve;
       ``(4) provide, to the maximum extent practicable, for a 
     variety of utility-scale solar electric energy technologies; 
     and
       ``(5) ensure, to the maximum extent practicable, that all 
     solar energy reserves pursuant to this section are permitted 
     using an expedited permitting process.
       ``(e) Developing Solar Energy Reserves.--
       ``(1) In general.--Subject to paragraph (2), in carrying 
     out this section, the Secretary may--
       ``(A) install appropriate infrastructure, including--
       ``(i) roads;
       ``(ii) renewable feeder lines that connect to transmission 
     lines; and

[[Page S2845]]

       ``(iii) equipment to access public or private utility 
     systems;
       ``(B) recover reasonable costs to pay for the management of 
     the solar energy reserves and maintenance of the 
     infrastructure relating to the use of the land, except that 
     the Secretary shall not recover costs to pay for 
     infrastructure if the costs have or will be paid for by 
     Federal funds, to remain available until expended; and
       ``(C) negotiate agreements on behalf of all solar 
     electricity systems within the solar energy reserve for--
       ``(i) the purchase of materials and equipment;
       ``(ii) the provision of public utility services and other 
     services; and
       ``(iii) access to electric transmission facilities.
       ``(2) Opting out.--A developer of a solar electricity 
     system shall have the option, prior to the effective date of 
     the agreement, to opt out of any agreement negotiated by the 
     Secretary under paragraph (1)(C).
       ``(f) Royalties and Fees.--
       ``(1) In general.--In lieu of rental fees, each solar 
     electricity system developer shall pay to the Secretary a 
     royalty on the sale of electricity produced from a solar 
     electricity system placed into service on a solar energy 
     reserve established under this section.
       ``(2) Amount of royalty.--The amount of the royalty payable 
     for a solar electricity system placed into service on a solar 
     energy reserve under this subsection shall be equal to 1.0 
     mil per kilowatt-hour of electricity generated by the 
     facility.
       ``(3) Deposit in treasury.--All royalties received by the 
     United States from royalties under this subsection shall be 
     deposited in the Treasury.
       ``(4) Use of royalties.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), of 
     the amount of royalties deposited in the Treasury from a 
     solar energy reserve for a fiscal year under paragraph (3)--
       ``(i) 20 percent shall be paid to the 1 or more States 
     within the boundaries of which the solar energy reserve is 
     located;
       ``(ii) 30 percent shall be paid to the 1 or more counties 
     within the boundaries of which the solar energy reserve is 
     located;
       ``(iii) 20 percent shall be deposited in a separate account 
     in the Treasury, to be known as the `BLM Solar Energy Permit 
     Processing Improvement Fund', except that if the Fund equals 
     $10,000,000 or more, no additional royalties under this 
     subsection shall be deposited in the Fund; and
       ``(iv) 5 percent shall be deposited into a separate account 
     in the Treasury, to be known as the `Solar Energy Land 
     Reclamation, Remediation, and Restoration Fund'.
       ``(B) BLM solar energy permit processing improvement 
     fund.--Amounts deposited under subparagraph (A)(iii) shall be 
     available to the Secretary of the Interior for expenditure, 
     without further appropriation and without fiscal year 
     limitation, for the purpose of paying for the coordination 
     and processing of solar energy right-of-way permit and land 
     use applications and planning for solar energy development on 
     land under the jurisdiction of the Bureau of Land Management.
       ``(C) Solar energy land reclamation, remediation, and 
     restoration fund.--Amounts deposited under subparagraph 
     (A)(iv) shall be available to the Secretary of Energy for 
     expenditure, without further appropriation and without fiscal 
     year limitation, for the purpose of reclaiming, remediating, 
     and restoring land within a solar energy reserve on which a 
     solar electricity facility has permanently ceased operation 
     before disposal or for withdrawn land that is returned to the 
     Department of the Interior.
       ``(g) Authorization of Appropriations.--There are 
     authorized to be appropriated to the Secretary of Energy and 
     the Secretary of the Interior such sums as are necessary to 
     carry out this section.

     ``SEC. 410. RELATIONSHIP TO OTHER LAWS.

       ``Nothing in this part supersedes or affects any Federal 
     environmental, public health or public land protection, or 
     historic preservation law, including--
       ``(1) the National Environmental Policy Act of 1969 (42 
     U.S.C. 4321 et seq.);
       ``(2) the Endangered Species Act of 1973 (16 U.S.C. 1531 et 
     seq.); and
       ``(3) the National Historic Preservation Act (16 U.S.C. 470 
     et seq.).

     ``SEC. 411. REGULATIONS.

       ``Except as otherwise provided in this part, not later than 
     1 year after the date of enactment of this part, the 
     Commission shall promulgate such regulations as are necessary 
     to carry out this part.''.
       (b) Green Transmission Infrastructure Incentive Rates.--
     Section 219(a) of the Federal Power Act (16 U.S.C. 824s(a)) 
     is amended by striking ``purpose of'' and all that follows 
     through the end of the subsection and inserting ``purpose 
     of--
       ``(1) benefitting consumers by ensuring reliability and 
     reducing the cost of delivered power by reducing transmission 
     congestion; or
       ``(2) integrating renewable energy resources into the 
     transmission system.''.
       (c) Maximum Funding Amount for Third-Party Finance.--
     Section 1222 of the Energy Policy Act of 2005 (42 U.S.C. 
     16421) is amended by striking subsection (g) and inserting 
     the following:
       ``(g) Maximum Funding Amount.--The Secretary shall not 
     accept and use more than $2,500,000,000 under subsection 
     (c)(1) for the period of fiscal years 2009 through 2018.''.
       (d) Enforcement.--Section 316A of the Federal Power Act (16 
     U.S.C. 825o-1) is amended by striking ``part II'' each place 
     it appears and inserting ``part II or IV''.

     SEC. 4. RENEWABLE ENERGY PILOT PROJECT OFFICES.

       (a) In General.--Section 365 of the Energy Policy Act of 
     2005 (42 U.S.C. 15924) is amended by adding at the end the 
     following:
       ``(k) Pilot Project Office to Improve Federal Permit 
     Coordination for Renewable Energy.--
       ``(1) Definition of renewable energy.--In this subsection, 
     the term `renewable energy' means energy derived from a wind, 
     solar, geothermal, or biomass source.
       ``(2) Field project offices.--As part of the Pilot Project, 
     the Secretary shall designate 1 or more field offices of the 
     Bureau of Land Management in each of the following States to 
     serve as Renewable Energy Pilot Project Offices for 
     coordination of Federal permits for renewable energy projects 
     and renewable energy transmission involving Federal land 
     (other than permits issued by the Federal Energy Regulatory 
     Commission):
       ``(A) Arizona.
       ``(B) California.
       ``(C) Colorado.
       ``(D) Oregon or Washington.
       ``(E) New Mexico.
       ``(F) Nevada.
       ``(G) Montana.
       ``(H) Wyoming.
       ``(3) Memorandum of understanding.--
       ``(A) In general.--Not later than 90 days after the date of 
     enactment of this subsection, the Secretary shall enter into 
     an amended memorandum of understanding under subsection (b) 
     to provide for the inclusion of the additional Renewable 
     Energy Pilot Project Offices in the Pilot Project.
       ``(B) Signatures by governors.--The Secretary may request 
     that the Governors of each of the States described in 
     paragraph (2) be signatories to the amended memorandum of 
     understanding.
       ``(C) Designation of qualified staff.--Not later than 30 
     days after the date of the signing of the amended memorandum 
     of understanding, all Federal signatory parties shall, if 
     appropriate, assign to each Renewable Energy Pilot Project 
     Offices designated under paragraph (2) an employee described 
     in subsection (c) to carry out duties described in that 
     subsection.
       ``(D) Additional personnel.--The Secretary shall assign to 
     each Renewable Energy Pilot Project Office additional 
     personnel under subsection (f).''.
       (b) Permit Processing Improvement Fund.--Section 35(c)(3) 
     of the Mineral Leasing Act (30 U.S.C. 191(c)(3)) is amended--
       (1) by striking ``use authorizations'' and inserting ``and 
     renewable energy use authorizations''; and
       (2) by striking ``section 365(d)'' and inserting 
     ``subsections (d) and (k)(2) of section 365''.
                                  ____


   The Clean Renewable Energy and Economic Development Act of 2009--
                                Summary

       Sec. 402. Renewable Energy Zones: This bill directs the 
     President to designate renewable energy zones, which are 
     areas that can generate in excess of 1 gigawatt of 
     electricity from renewable energy, include rural areas or 
     Federal land, and have insufficient transmission capacity to 
     achieve their renewable energy generation potential. This 
     bill excludes environmentally sensitive and culturally 
     significant areas from renewable energy zones.
       Electricity from renewable energy is defined to include 
     solar, wind, geothermal, biomass, biogas, incremental 
     hydroelectric capacity and hydrokinetic resources.
       Some areas, especially the Western U.S., already have 
     processes in place to identify renewable energy zones. 
     Recognizing the ongoing efforts in the Western U.S., this 
     bill allows the President to use zones designated through 
     existing processes, and sets deadlines on designating 
     renewable energy zones for the Western Interconnection of 90 
     days after enactment of the bill and 270 days after enactment 
     of the bill for the Eastern Interconnection.
       Sec. 403. Interconnection-Wide Green Transmission Grid 
     Planning: Transmission planning today is a geographically 
     fragmented, lengthy process that does not address the types 
     of projects needed to integrate renewable energy into the 
     transmission grid. The U.S. electric transmission network is 
     divided into three interconnections, the West, the East, and 
     Texas. This bill requires participatory and transparent 
     transmission planning on an interconnection-wide basis for 
     green transmission projects to integrate renewable 
     electricity resources from renewable energy zones into the 
     transmission grid. The objective of the planning process is 
     to enhance transmission access for electricity from renewable 
     energy in renewable energy zones, while recognizing national 
     economic, reliability, and security goals. The planning 
     process established in this bill must be based on established 
     and projected Federal and State renewable energy policies and 
     targets. This bill requires the planning process to solicit 
     input from all stakeholders, including transmission owners, 
     regional transmission organizations, independent system 
     operators, State commissions, electricity generators, 
     prospective developers of new transmission and generation 
     resources, regional reliability organizations, and 
     environmental protection and land, water, and wildlife 
     conservation groups.
       This bill requires the plan to consider alternatives to new 
     transmission, including

[[Page S2846]]

     energy efficiency, demand response, distributed generation, 
     and cost-effective energy storage.
       To expedite building transmission to meet the President's 
     renewable energy goal, this bill requires the 
     interconnection-wide green transmission plans to be submitted 
     to the Commission within 1 year of the deadline for 
     designation of renewable energy zones.
       If a regional planning entity does not organize a planning 
     process, or does not complete a plan by the deadlines 
     established by FERC, this bill gives FERC backstop planning 
     authority to establish a planning process and conduct 
     planning, in consultation with DOE, federal power marketing 
     authorities, the electric reliability organization and 
     regional reliability organizations. This bill also gives FERC 
     backstop planning authority for any state that does not 
     participate in an interconnection-wide planning process.
       To cover costs of regional planning entities and states 
     participating in interconnection-wide planning, this bill 
     establishes a surcharge on all transmission customers. The 
     funds from the surcharge will be distributed to regional 
     planning entities and to states whose governors certify that 
     they are participating in green transmission planning for the 
     first year, and subject to timely submission of a green 
     transmission grid plan in subsequent years. State Governors 
     are also required to demonstrate that planning entities are 
     able to effectively represent a wide spectrum of 
     stakeholders, including the protection and conservation of 
     land, consumer protection, and fish and wildlife protection.
       Sec. 404. Federal Siting of Green Transmission Grid Project 
     Facilities: Transmission line siting is currently conducted 
     through a separate process in each state, which can cause 
     lengthy delays for multi-state transmission lines. This bill 
     allows transmission project developers to apply to FERC for 
     federal backstop siting for green transmission projects that 
     are part of the green transmission grid plan and integrate 
     renewable energy resources from renewable energy zones, or 
     for transmission projects that FERC determines are needed to 
     integrate renewable generation resources. For states that 
     participate in interconnection-wide planning, this bill 
     requires FERC to consider state recommendations in siting the 
     line, and to work with states to resolve differences. This 
     bill gives FERC the authority to issue a construction permit, 
     including the right of eminent domain, for green transmission 
     projects that meet specific conditions, including a minimum 
     renewable requirement, optimizing transmission capacity, and 
     providing transmission access to states the project passes 
     through. To coordinate the process of siting transmission on 
     Federal lands, this bill sets FERC as the lead agency for 
     environmental reviews, with a single environmental review 
     document, and directs affected agencies to develop a 
     memorandum of understanding, including a schedule for 
     environmental review and a budget necessary to carry out the 
     schedule.
       This bill ensures that green transmission projects are 
     truly green by requiring transmission line siting to consider 
     and use alternative routes where possible to avoid 
     environmentally sensitive or culturally significant areas. In 
     addition, this bill requires transmission projects that use 
     federal siting authority to ensure that at least 75% of the 
     capacity of transmission project is available to renewable 
     generation, or the maximum possible amount of renewable 
     generation that can be reliably interconnected. In addition, 
     to ensure that renewable generation resources have access to 
     transmission, transmission providers for green transmission 
     projects that use federal siting must give priority to load-
     serving entities contracting with renewable generators, or to 
     renewable generation developers, when offering firm 
     transmission rights.
       As a condition for federal siting, each transmission 
     project developer must demonstrate that it has sufficient 
     capacity to connect multiple renewable generation resources 
     in the renewable energy zone(s) to which it connects, based 
     on reliability criteria, land use limitations, economic 
     considerations and the potential generation capacity of the 
     renewable energy zones interconnected to the project. This 
     will allow future renewable generators to connect to the 
     transmission system without building multiple transmission 
     lines through an area.
       Large transmission lines may pass through states without 
     providing any benefit to the state. This bill requires green 
     transmission projects that use federal siting authority to 
     provide transmission access to load or generation in each 
     state they pass through. If a project cannot provide 
     interconnection to a state, that state will be eligible for 
     additional funds through DOE grants.
       Sec. 405. Grants for green transmission grid project plans: 
     This bill authorizes the DOE, in consultation with FERC, to 
     make grants to states and planning entities to implement the 
     planning and siting described in this bill, for transmission 
     improvements including smart grid investments, for training 
     for state public utility commission staff, for mitigation of 
     landowner concerns, for habitat and wildlife conservation, 
     for security upgrades to the transmission system, for energy 
     storage, for reliability projects, transmission business 
     development, and for distributed generation projects. These 
     grants are funded through the American Recovery and 
     Reinvestment Act of 2009, and in the future through sale of 
     carbon allowances if a carbon allowance system is 
     implemented. These grants are available only to states that 
     participate in green transmission grid planning and implement 
     green transmission grid projects in a timely fashion.
       Sec. 406. Cost Allocation: This bill encourages the States 
     and participants in a green transmission plan to agree on and 
     propose a cost allocation to FERC. If no cost allocation is 
     filed, this bill allows FERC to determine a just and 
     reasonable cost allocation that takes account of the widely 
     distributed impacts of the transmission project. This bill 
     allows FERC to allocate costs to all users, owners, and 
     operators of the bulk power system in a region of an 
     interconnection or throughout an interconnection.
       This bill provides that costs of a green transmission 
     project initially built with extra transmission capacity to 
     multiple renewable generators can initially be allocated with 
     the cost allocation. As new generation projects interconnect, 
     they will pay their share of the transmission grid project, 
     reducing the effect on rates of the transmission provider's 
     customers.
       Sec. 407. Encouraging Clean Energy Development in Renewable 
     Energy Zones: To ensure that transmission projects needed to 
     integrate renewable energy resources get built in a timely 
     manner, this bill allows federal transmitting utilities to 
     construct projects if no privately-funded entity commits to 
     financing them within 3 years. This bill extends bonding 
     authority of federal transmitting utilities to finance 
     construction of transmission.
       Sec. 408. Federal power marketing agencies: This bill 
     directs federal power marketing agencies to promote renewable 
     energy and energy efficiency, by developing wind, solar and 
     geothermal integration programs, and directs the federal 
     transmitting utilities to undertake renewable electricity and 
     energy security projects. It also directs WAPA to study 
     reregulating hydroelectric dams and allows WAPA to fund a 
     wind-hydro or solar-hydro integration demonstration project.
       Sec. 409. Solar Energy Reserve Pilot Project: This bill 
     establishes a pilot program on Federal land for commercial 
     utility-scale solar electric energy systems on lands 
     identified by the Secretary of Interior and the Secretary of 
     Energy.
       Sec. 410. Investment incentives: To encourage investment in 
     green transmission projects, this bill extends infrastructure 
     investment incentives from the Energy Policy Act of 2005 to 
     include transmission projects that integrate renewable energy 
     resources into the transmission system. The limit on third-
     party financing of transmission investments in the Western 
     Area and Southwestern Area Power Administration territories 
     is raised to $2.5 billion.
                                 ______