[Senate Report 112-31]
[From the U.S. Government Publishing Office]


                                                        Calendar No. 98
112th Congress                                                   Report
                                 SENATE
 1st Session                                                     112-31

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



 
         MARINE AND HYDROKINETIC RENEWABLE ENERGY PROMOTION ACT

                                _______
                                

                 July 11, 2011.--Ordered to be printed

                                _______
                                

   Mr. Bingaman, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 630]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 630) to promote marine and hydrokinetic 
renewable energy research and development, and for other 
purposes, having considered the same, reports favorably thereon 
with amendments and recommends that the bill, as amended, do 
pass.
    The amendments are as follows:
    1. On page 3, line 9, strike ``3'' and insert ``4''.
    2. On page 3, lines 13 and 14, strike ``operating 
environments'' and insert ``operating marine environments 
(including industry demonstrations)''.
    3. On page 3, between lines 14 and 15, insert the 
following:
          ``(2) Preference.--In awarding competitive grants 
        under this subsection, the Secretary shall give 
        preference to existing marine and hydrokinetic testing 
        facilities and existing Centers established under 
        section 634.''.
    4. On page 3, line 15, strike ``(2)'' and insert ``(3)''.
    5. On page 3, line 21, strike ``(3)'' and insert ``(4)''.
    6. On page 4, line 4, strike ``(4)'' and insert ``(5)''.
    7. On page 4, line 14, strike ``(5)'' and insert ``(6)''.
    8. On page 4, strike lines 22 through 24 and insert the 
following:
                          ``(iv) a university consortium;
                          ``(v) a National Laboratory; or
                          ``(vi) a Center established under 
                        section 634; and''.
    9. On page 5, strike lines 8 through 11 and insert the 
following:
                                  ``(III) energy;
                                  ``(IV) ocean engineering; and
                                  ``(V) electrical, mechanical, 
                                and civil engineering; and
                          ``(ii) partner with other entities 
                        (including industry) that''.
    10. On page 7, line 13, insert ``Centers established under 
section 634,'' after ``with''.
    11. On page 5, line 7, insert ``and riverine'' after 
``marine''.
    12. Strike section 8 and insert the following:

SEC. 8. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--Section 639 of the Energy Independence and 
Security Act of 2007 (42 U.S.C. 17215) (as redesignated by 
section 5(1)) is amended to read as follows:

``SEC. 639. AUTHORIZATION OF APPROPRIATIONS.

    ``(a) In General.--There is authorized to be appropriated 
to carry out this subtitle, to remain available until 
expended--
          ``(1) $70,000,000 for fiscal year 2012; and
          ``(2) $75,000,000 for fiscal year 2013.
    ``(b) Renewable Energy Funds.--No funds shall be 
appropriated under this section for activities that are 
receiving funds under section 931(a) (2)(E) (i) of the Energy 
Policy Act of 2005 (42 U.S.C. 16231(a)(2)(E)(i)).''.
    (b) Offsets.--
          (1) Fiscal year 2012.--Section 609(d) of the Public 
        Utility Regulatory Policies Act of 1978 (7 U.S.C. 
        918c(d)) is amended by striking ``2012'' and inserting 
        ``2011''.
          (2) Fiscal year 2013.--The amount otherwise made 
        available to carry out section 412 of the Energy Policy 
        Act of 2005 (42 U.S.C. 15972) shall be reduced by 
        $75,000,000 for fiscal year 2013.
    13. Strike section 9 and insert the following:

SEC. 9. NATIONAL RENEWABLE ENERGY DEPLOYMENT PROGRAM.

    (a) In General.--Section 803 of the Energy Independence and 
Security Act of 2007 (42 U.S.C. 17282) is amended by striking 
the section heading and inserting ``NATIONAL RENEWABLE ENERGY 
DEPLOYMENT PROGRAM''.
    (b) Definitions.--Section 803(a) of the Energy Independence 
and Security Act of 2007 (42 U.S.C. 17282(a)) is amended--
          (1) by striking paragraph (1);
          (2) by redesignating paragraphs (2) through (4) as 
        paragraphs (1) through (3), respectively;
          (3) in subparagraph (B)(iv) of paragraph (3) (as so 
        redesignated), by striking ``Alaska''; and
          (4) by adding at the end the following:
          ``(4) Small hydroelectric power.--The term `small 
        hydroelectric power' means power that--
                  ``(A) is generated--
                          ``(i) without the use of a dam or 
                        impoundment of water; and
                          ``(ii) through the use of--
                                  ``(I) a lake tap (but not a 
                                perched alpine lake); or
                                  ``(II) a run-of-river 
                                screened at the point of 
                                diversion; and
                  ``(B) has a nameplate capacity rating of a 
                wattage that is not more than 15 megawatts.''.
    (c) Renewable Energy Construction Grants.--Section 803(b) 
of the Energy Independence and Security Act of 2007 (42 U.S.C. 
17282(b)) is amended--
          (1) in paragraph (1)--
                  (A) by inserting ``establish a national 
                renewable energy construction grants program 
                under which the Secretary shall'' after 
                ``shall''; and
                  (B) by inserting ``, including feasibility 
                studies for such projects'' before the period 
                at the end; and
          (2) by adding at the end the following:
          ``(5) Priority.--In making grants to eligible 
        applicants to carry out renewable energy projects under 
        this section, the Secretary shall give priority to 
        applicants that--
                  ``(A) have power costs that are 125 percent 
                or more of average national retail costs; and
                  ``(B) will use the grant to construct 
                renewable electricity projects to replace or 
                partially replace fossil fuel projects.''.

                                Purpose

    The purpose of S. 630 is to promote marine and hydrokinetic 
renewable energy research and development, and for other 
purposes.

                          Background and Need

    There is potential to increase production of energy from 
waves, tides, and river currents in the United States. 
Additional research and a more extensive resource assessment 
are needed to fully understand the wave resource potential and 
to ensure that hydro-kinetic sources can be developed at 
reasonable costs. Additional research is also necessary to help 
address the environmental impacts of hydrokinetic projects. 
Research programs can also help with the deployment and 
installation of hydrokinetic technologies to make them 
commercially viable and sustainable.
    The Federal Energy Regulatory Commission (FERC) has 
recently conducted workshops and pilot licensing processes for 
approval of hydrokinetic projects. As of March 2011, FERC had 
issued 98 preliminary permits for hydrokinetic projects with 
the potential to develop over 10,000 megawatts of power, and 
over 150 preliminary permits were pending with the potential to 
develop almost 18,000 megawatts of power. FERC has entered into 
Memoranda of Understanding regarding hydrokinetic energy 
development with the States of California, Washington, Maine, 
and Oregon. Additional coordination of research activities and 
collaboration among stakeholders will promote better research 
outcomes.

                          Legislative History

    Senator Murkowski introduced S. 630 on March 17, 2011. The 
bill is co-sponsored by Senators Begich and Whitehouse. The 
Committee on Energy and Natural Resources held a hearing on S. 
630 on March 31, 2011, and considered and amended the bill at 
its business meetings on April 12, 2011 and May 26, 2011. The 
Committee ordered S. 630 favorably reported, as amended, at its 
business meeting on May 26, 2011.

                        Committee Recommendation

    The Senate Committee on Energy and Natural Resources, in 
open business session on May 26, 2011, by voice vote of a 
quorum present, recommends that the Senate pass S. 630, if 
amended as described herein.

                          Committee Amendments

    During its consideration of S. 630, the Committee adopted 
13 amendments. The first ten, adopted en bloc, create a 
preference for existing marine and hydrokinetic testing 
facilities and existing National Marine Renewable Energy 
Research, Development, and Demonstration Centers in the award 
of competitive grants, add university consortia to the list of 
entities eligible to receive grants, add ocean engineering to 
the list of qualifying fields of expertise, and make additional 
clarifying and conforming changes. The eleventh adds 
``riverine'' sciences to the list of qualifying fields of 
expertise. The twelfth reduces and limits the authorization of 
appropriations for the marine and hydrokinetic program, 
terminates the authorization of appropriations for rural and 
remote communities electrification grants, and reduces the 
authorization for the clean coal technology plant in Healy, 
Alaska. The final amendment modifies the amendments proposed in 
section 9 of the bill to the Alaska small renewable energy 
deployment program in section 803(a) of the Energy Independence 
and Security Act by expanding the program to apply nationally, 
but retaining the limitation to small hydroelectric power 
projects.

                      Section-by-Section Analysis

    Section 1 provides the short title of the bill and table of 
contents.
    Section 2 amends section 633 of the Energy Independence and 
Security Act of 2007 (EISA) by adding additional opportunities 
for marine and hydrokinetic technology development and 
deployment.
    Section 3 adds a new subsection (c) to section 633 of EISA 
that creates a competitive grant program within the Department 
of Energy to encourage research, development and demonstration 
of marine and hydrokinetic test facilities to promote new 
technologies.
    Section 4 amends section 634 of EISA to clarify that 
national marine and hydrokinetic renewable energy research, 
development, and demonstration centers should serve as 
information clearinghouses for marine and hydrokinetic 
renewable energy technologies.
    Section 5 adds a new section 635 to EISA (and redesignates 
the existing one) to create a marine-based energy device 
verification program within the Department of Energy to provide 
an opportunity to test and evaluate marine and hydrokinetic 
renewable energy technologies in new areas.
    Section 6 adds a new section 636 to EISA to create an 
adaptive management and environmental grant program within the 
Department of Energy to help fund environmental analysis 
affecting the deployment of marine hydrokinetic devices and 
help gather data and monitor impacts of demonstration projects.
    Section 7 adds a new section 637 to EISA to establish 
improved administration of the Department of Energy's existing 
hydrokinetic research program and requires a report to Congress 
on the research, development, demonstration, and installation 
of projects as a result of the program.
    Section 8 amends the authorizations of appropriations in 
section 636 of EISA (which section 5 of the bill redesignates 
as section 639) to increase the authorization for fiscal year 
2012 by $20 million, authorize appropriation of $75 million for 
fiscal year 2013, prohibit appropriation of funds under the 
section for ocean energy activities funded under section 931 of 
the Energy Policy Act of 2005, terminate funding for rural and 
remote communities electrification grants, and reduce funding 
for the clean coal technology plant in Healy, Alaska.
    Section 9 amends the Alaska small hydroelectric power 
deployment program authorized by Section 803 of EISA to make it 
apply nationally and to establish new priorities for awarding 
grants under the program.

                   Cost and Budgetary Considerations

    The following estimate of costs of this measure has been 
provided by the Congressional Budget Office:

S. 630--Marine and Hydrokinetic Renewable Energy Promotion Act of 2011

    Summary: S. 630 would authorize appropriations to support a 
variety of activities aimed at promoting the development of 
hydropower, particularly marine and hydrokinetic energy devices 
that produce energy from moving water. Assuming appropriation 
of the authorized amounts, CBO estimates that implementing S. 
630 would have a net discretionary cost of $87 million over the 
2012-2016 period. Enacting S. 630 would not affect direct 
spending or revenues; therefore, pay-as-you-go procedures do 
not apply.
    S. 630 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 630 is shown in the following table. The 
costs of this legislation fall within budget function 270 
(energy).

----------------------------------------------------------------------------------------------------------------
                                                                    By fiscal year, in millions of dollars--
                                                              --------------------------------------------------
                                                                2012    2013    2014    2015    2016   2012-2016
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Grants for Marine and Hydrokinetic Energy:
    Authorization Level......................................      20      75       0       0       0        95
    Estimated Outlays........................................       4      21      29      26      12        92
Grants for Small Hydropower Projects:
    Estimated Authorization Level............................       3       3       3       3       3        15
    Estimated Outlays........................................       3       3       3       3       3        15
Reduced Authorizations for Energy Projects:
    Authorization Level......................................     -20       0       0       0       0       -20
    Estimated Outlays........................................      -2      -6      -6      -4      -2       -20
    Total Proposed Changes:
        Estimated Authorization Level........................       3      78       3       3       3        90
        Estimated Outlays....................................       5      18      26      25      13        87
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: S. 630 would authorize appropriations to 
promote the development of marine and hydrokinetic energy as 
well as authorize the Department of Energy (DOE) to provide 
grants to pay for half of the cost of constructing small 
hydropower projects throughout the country. The bill also would 
eliminate an existing authorization of appropriations to 
support certain energy projects. Taken as a whole, CBO 
estimates that implementing S. 630 would result in a net 
increase in discretionary spending of $87 million over the 
2012-2016 period.

Spending for marine and hydrokinetic energy

    S. 630 would authorize appropriations totaling $145 million 
over the 2012-2013 period for DOE to carry out a variety of 
activities to promote research, development, and deployment of 
marine and hydrokinetic energy devices. According to DOE, the 
agency has allocated $20 million to develop marine and 
hydrokinetic technologies in 2011.
    Current law already authorizes the appropriation of $50 
million for activities related to marine and hydrokinetic 
energy in 2012; therefore, the incremental increase in funding 
authorized by S. 630 would total $95 million over the 2012-2013 
period. Under the bill, DOE would use authorized amounts to 
establish facilities to research and test such devices, develop 
systems to test and share information on their performance and 
reliability, and provide grants to support analyses of their 
impact on the environment. Assuming appropriation of the 
authorized amounts, CBO estimates that spending for such 
activities would increase spending by $92 million over the 
2012-2016 period, based on historical spending patterns for 
existing and similar programs.

Grants for small hydropower

    S. 630 would amend a provision of current law (42 U.S.C. 
17282) that authorizes DOE to provide grants to support the 
construction of certain renewable energy facilities, including 
small hydropower facilities with a capacity of 15 megawatts or 
less. Under current law, DOE can only provide support for 
hydropower projects located in the state of Alaska; S. 630 
would remove that restriction and allow DOE to support projects 
anywhere in the country.
    Based on information from the Federal Energy Regulatory 
Commission (FERC), which must issue a permit for all hydropower 
facilities regardless of size, CBO estimates that an average of 
roughly 3.6 megawatts of new generating capacity has been 
licensed in each of the past 10 years. Based on information 
from DOE about current costs to build small hydropower 
facilities and assuming that investments in future years remain 
in line with trends over the past decade, CBO estimates that 
total spending to construct new facilities will average about 
$6 million a year over the 2012-2016 period. S. 630 would 
authorize DOE to provide grants for up to half of that amount; 
thus, CBO estimates that fully funding this provision would 
require appropriations of about $3 million annually over the 
2012-2016 period. Assuming appropriation of the estimated 
amounts, CBO estimates that resulting spending would total $15 
million over that same period.

Reduced authorization for energy projects

    To offset a portion of increased discretionary spending, S. 
630 would eliminate an existing authorization to appropriate 
$20 million in 2012 to support certain energy-related projects 
in rural areas. Assuming future appropriations are reduced 
accordingly, CBO estimates that implementing that provision 
would result in $20 million less in discretionary spending over 
the 2012-2016 period.
    S. 630 would also direct that any amounts authorized to be 
appropriated in 2013 to cover the federal cost of a direct loan 
to a specific clean coal facility in Alaska be reduced by $75 
million. Consistent with requirements of the Federal Credit 
Reform Act, current law authorizes the appropriation of 
whatever amounts are necessary to cover the anticipated subsidy 
cost of the authorized loans. CBO estimates that this provision 
of S. 630 would have no impact on spending subject to 
appropriation because it would make no corresponding changes to 
the terms of the authorized loan and would therefore not affect 
the amount of the subsidy required to support the loan.
    Pay-As-You-Go considerations: None.
    Intergovernmental and private-sector impact: S. 630 
contains no intergovernmental or private-sector mandates as 
defined in UMRA. The bill could benefit state and local 
governments by authorizing grants related to renewable energy 
generated from marine and hydrokinetic sources. Any costs those 
entities incur to meet grant requirements would result from 
complying with the conditions of federal assistance.
    Estimate prepared by: Federal costs: Megan Carroll; Impact 
on state, local, and tribal governments: Ryan Miller; Impact on 
the private sector: Amy Petz.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                      Regulatory Impact Evaluation

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out S. 630.
    The bill is not a regulatory measure in the sense of 
imposing Government-established standards or significant 
economic responsibilities on private individuals and 
businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Little, if any, additional paperwork would result from the 
enactment of S. 630, as ordered reported.

                   Congressionally Directed Spending

    S. 630, as ordered reported, does not contain any 
congressionally directed spending items, limited tax benefits, 
or limited tariff benefits as defined in rule XLIV of the 
Standing Rules of the Senate.

                        Executive Communications

    The testimony provided by the Federal Energy Regulatory 
Commission, and the Department of Energy, at the March 31, 
2011, Full Committee hearing on S. 630 follows:

 Statement of Steven G. Chalk, Chief Operating Officer & Acting Deputy 
 Assistant Secretary for Renewable Energy, Office of Energy Efficiency 
               and Renewable Energy, Department of Energy

    Chairman Bingaman, Ranking Member Murkowski, Members of the 
Committee, thank you for the opportunity to discuss the three 
pieces of legislation before us today: S. 629, the Hydropower 
Improvement Act of 2011; S. 630, the Marine and Hydrokinetic 
Renewable Energy Promotion Act of 2011; and Title I, subtitle D 
of the American Clean Energy Leadership Act of 2009 (ACELA, S. 
1462 from the 111th Congress).
    In his State of the Union address in January, President 
Obama referred to America's need to transition to a clean 
energy economy as ``our generation's Sputnik moment,'' a goal 
so important that we need to ``reach a level of research and 
development we haven't seen since the height of the Space 
Race.''\1\ S. 629 and S. 630 would dramatically increase the 
federal government's investment in both conventional hydropower 
and marine and hydrokinetic (MHK) renewable energy 
technologies.
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    \1\http://www.whitehouse.gov/the-press-office/2011/01/25/remarks-
president-state-union- address.
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    The provisions being considered from ACELA address the 
interdependence of our energy and water consumption. Water is 
an integral component of many traditional and alternative 
energy technologies used for transportation, fuels production 
and electricity generation. Energy-related water demands are 
beginning to compete with other demands from population growth, 
agriculture and sanitation. This competition could become 
fiercer if climate change increases the risk of drought, making 
our water supply more vulnerable. The Department of Energy 
(DOE) has initiated many activities over the last few years to 
address this energy-water nexus.\2\
---------------------------------------------------------------------------
    \2\See, for example, the activities undertaken by the National 
Energy Technology Laboratory, http://www.netl.doe.gov/technologies/
coalpower/ewr/water/index.html.
---------------------------------------------------------------------------
    Since fiscal year 2008, when DOE restarted its Water Power 
Program, it has made significant strides in advancing next-
generation water power technologies, assessing existing 
resources, promoting deployment opportunities, and cooperating 
with other government agencies to accelerate water power 
development. About 45 percent of all hydropower in the United 
States is generated at Federally owned facilities, providing 
clean, renewable power to the grid.\3\ DOE's estimates indicate 
that there could be an additional 300 gigawatts of hydropower 
through efficiency and capacity upgrades at existing 
facilities, powering non-powered dams, new small 
hydrodevelopment and pumped storage hydropower.\4\
---------------------------------------------------------------------------
    \3\http://eia.doe.gov/cneaf/electricity/page/eia906_920.html.
    \4\FY09 DOE Interim Conventional Hydro Resource Assessment, Oak 
Ridge National Lab.
---------------------------------------------------------------------------
    DOE works on both conventional hydropower and on marine and 
hydrokinetic (MHK) technologies. The combined FY 2012 Budget 
Request for conventional hydropower and MHK technologies is 
$38.5 million. Conventional hydropower--energy derived from 
water using dams, diversionary structures, or impoundments for 
electric power--generates more electricity than any other 
renewable energy source in the U.S. Conventional hydropower 
represented 65 percent of U.S. renewable electricity generation 
in 2010, and seven percent of total U.S. electricity generation 
that year.\5\ Conventional hydropower principally serves as a 
baseload electricity supply, but can also function as a 
dispatchable resource to balance variable renewable energy 
technologies such as wind and solar.
---------------------------------------------------------------------------
    \5\http://www.eia.doe.gov/cneaf/electricity/epa.pdf 
---------------------------------------------------------------------------
    MHK technologies include energy devices that can extract 
energy from moving water, including waves and currents in 
oceans, rivers, and tidal areas, and from ocean thermal and 
salinity gradients. These resources if also developed in an 
environmentally responsible manner hold potential for helping 
our nation meet its clean energy goals.
    In a March 2007 report, the Electric Power Research 
Institute indicated that its conservative estimate was that MHK 
power (from wave and tidal sources alone) could provide an 
additional 13,000 megawatts (MW) of capacity by 2025.\6\ MHK 
power and ocean thermal energy are resources that typically can 
have higher capacity factors than some other renewable energy 
sources. In addition, they may not present the same level of 
integration challenges that large-scale development of variable 
renewable energy sources such as wind and solar may create for 
electricity grid planners and operators.
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    \6\http://www.aaas.org/spp/cstc/docs/07_06_1ERPI_report.pdf.
---------------------------------------------------------------------------
    Through its Power Marketing Administrations (PMAs), DOE 
promotes and creates opportunities for new conventional 
hydropower technologies and development. PMAs encourage the 
most widespread use of hydropower possible at the lowest rates 
consistent with sound business principles. Some PMAs have 
established an active hydropower modernization program, adding 
hundreds of megawatts of capacity at existing facilities by 
updating equipment, while others have faced challenges in 
arranging financing. Because some of the challenges are 
statutory in nature, the PMAs and their customers may consult 
with the Committee on measures that would actively encourage 
expansion of hydropower capacity through updates to existing 
facilities.
    Last year, DOE, the Bureau of Reclamation, and the Army 
Corps of Engineers signed a memorandum of understanding (MOU) 
on hydropower that aims to build long-term working 
relationships between agencies by prioritizing similar goals 
and aligning ongoing and future renewable energy development 
efforts.\7\ The objectives of the MOU include deploying new, 
environmentally sustainable hydropower capacity, including 
upgrading existing facilities; powering non-powered dams; and 
research, development and deployment (RD&D) into new hydropower 
technologies, among other objectives. The pursuit and ultimate 
achievement of these goals will serve to strengthen our 
economy, enhance our national security, and protect our 
environment.
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    \7\http://www.energy.gov/news/8793.htm.
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    Water is an integral aspect of energy consumption and 
generation for many energy technologies other than hydropower 
as well. Many types of energy production make use of water, 
particularly for cooling, and increasingly, water-efficient 
technologies are being developed to reduce these impacts and 
help America use less water to meet its energy demands and use 
less energy to meet its water demands. Still, power generation 
from thermal energy sources (which include coal, natural gas 
and nuclear energy) accounted for approximately 41% of U.S. 
freshwater withdrawals in 2005.\8\ Although most of the water 
withdrawn for cooling thermal power plants is subsequently 
returned to the source, this still can have disruptive effects 
on water flows and temperatures, which in turn negatively 
affect aquatic organisms, namely fish populations such as 
salmon. DOE estimates that there are significant opportunities 
to reduce water consumption for both electricity and fuels 
production. For example, in the electricity sector, development 
of hybrid wet-dry cooling systems may reduce water consumption 
by 70-80 percent compared to recirculating cooling systems. 
Moving, pumping and treating water and wastewater is in itself 
quite energy-intensive, representing roughly four percent of 
U.S. electricity consumption.\9\
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    \8\http://pubs.usgs.gov/circ/1344/pdf/c1344.pdf.
    \9\http://www.circleofblue.org/waternews/wp-content/uploads/2010/
08/EPRI-Volume-4.pdf.
---------------------------------------------------------------------------
    The Department, through its National Laboratories and 
collaboration with universities and the private sector, is 
pursuing three major objectives to address the energy-water 
challenge. First, to address the increasing limited supplies of 
freshwater, DOE is considering strategies to increase use of 
nontraditional water resources in the power sector. Second, DOE 
is working to reduce the consumption of fresh water when 
generating electricity, while considering the full life-cycle 
of various energy technologies to determine how much water they 
demand and what kind of water quality they need. Finally, DOE 
is researching water-efficient technologies for the production 
of alternative or unconventional fuels for transportation.
    I am pleased to offer the Department's perspective on these 
pieces of legislation. I will discuss these bills in the order 
they appeared in my invitation to testify before this 
Committee.


               S. 629: HYDROPOWER IMPROVEMENT ACT OF 2011


    The Hydropower Improvement Act of 2011, S. 629, seeks to 
substantially increase hydroelectric capacity and generation 
and improve its environmental performance.
    A recent report from the Federal Energy Regulatory 
Commission (FERC) demonstrates that little additional 
hydropower is in the pipelines.\10\ Concerns include 
environmental issues, and nontechnical barriers to reduce the 
expense and uncertainty of the regulatory process is needed.
---------------------------------------------------------------------------
    \10\http://www.ferc.gov/legal/staff-reports/03-17-11-energy-
infrastructure.pdf.
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    The most significant provision of S. 629 is a proposed 
authorization to DOE of $50 million per year for competitive 
grants and $50 million per year for RD&D to increase hydropower 
generation. This authorization level is significantly higher 
than the FY 2012 Budget Request for EERE's conventional 
hydropower program of $20 million, and would also represent a 
substantial increase to the FY 2010 Budget for conventional 
hydropower of $13 million. These additional resources, if 
appropriated would enable increases in renewable hydropower 
generation, and provide for the accelerated demonstration of 
innovative technologies that can improve environmental 
performance.
    In FY 2010, DOE funded the Hydropower Advancement Project 
(HAP) for $3 million. The HAP is focused on the most cost-
effective, least-controversial types of new hydropower 
development, and seeks to stimulate further hydropower 
development and generation without new dams. The project has 
already identified multiple opportunities for adding generation 
and/or improving environmental performance without sacrificing 
energy efficiency. Current funding allows for fifty initial 
facility assessments and three to five detailed engineering 
design studies. Additional resources would be used to support 
facility improvements that could result in increased hydropower 
generation at the most cost-effective sites.
    DOE has invested in a three year program of research and 
development (R&D) to address issues related to the 
environmental performance and siting of hydropower 
technologies. These efforts focus on increasing fish passage, 
investigating adequate environmental flows and improving water 
quality and will help ensure that increases in conventional 
hydropower generation are coupled with concurrent improvements 
in the environmental sustainability of the industry, issues 
that DOE has been working on since the mid 1990s. If realized, 
the additional funding authorized by S. 629 would help scale-up 
the advanced turbines and optimize operational scenarios.
    A quicker, two-year FERC licensing process, as proposed by 
S. 629 would help accelerate development of conventional 
hydropower resources. A streamlined licensing approach already 
has been implemented by FERC for small hydropower projects; 
expanding this quicker process would be welcomed by DOE and the 
hydropower industry. At the same time, we must be sure that 
this quicker licensing process does not sacrifice rigorous 
maintenance of environmental standards and ensures adequate 
opportunity to allow for public input. Providing a quicker 
regulatory process when all environmental and public concerns 
have been addressed is a valuable goal.
    S. 629 would require FERC and the Bureau of Reclamation to 
conduct workshops on small hydropower projects and conduit 
hydropower.\11\ These workshops would provide opportunities for 
the federal government, including natural resource agencies, 
industry, environmental organizations and other stakeholders to 
reach consensus on strategies to overcome barriers to greater 
hydropower deployment, including conflicting definitions of 
eligible projects and complicated, poorly understood permitting 
and licensing processes.
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    \11\Conduits are defined as tunnels, canals, pipelines, aqueducts, 
flumes, ditches, or similar manmade water conveyance systems that 
distribute water for agricultural, municipal, or industrial consumption 
and not primarily for the generation of electricity.
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    S. 629 would define a ``small hydroelectric power project'' 
according to the definition found in Section 4.30 of title 18 
in the Code of Federal Regulations. DOE finds this definition 
problematic in this context, since this definition specifies 
that a small hydroelectric power project cannot be ``owned or 
operated by the United States or by an instrumentality of the 
Federal Government.'' A majority of the non-powered dams that 
are proposed to be powered through this legislation are 
federally-owned by the U.S. Army Corps of Engineers and the 
Bureau of Reclamation. In fact, initial analysis by DOE for a 
forthcoming report indicates that the ten largest non-powered 
dams in the US with potential to produce more than one megawatt 
are all operated by the Army Corps of Engineers.\12\ DOE 
accordingly recommends that the definition of small 
hydroelectric power project that appears in this legislation 
delete the requirement that the dam not be federally-owned or 
operated.
---------------------------------------------------------------------------
    \12\The National Hydropower Asset Assessment Project, to be 
released in April 2011.
---------------------------------------------------------------------------
    The Department appreciates that S. 629 recognizes the non-
application of this legislation to the PMAs. In addition, the 
PMAs believe that they should have the approval right for 
efficiency power or capacity additions, improvements or 
replacements at Federal projects, made in association with this 
legislation, where the Army Corps of Engineers and the Bureau 
of Reclamation seek appropriations.
    All other provisions of S. 629 would either build on or 
support current DOE activities and areas of interest.


 S. 630: MARINE AND HYDROKINETIC RENEWABLE ENERGY PROMOTION ACT OF 2011


    S. 630, the Marine and Hydrokinetic Renewable Energy 
Promotion Act of 2011, seeks to accelerate the growth of the 
MHK industry through additional federal aid, and expansion of 
the scope and scale of DOE's MHK activities. The additional 
funding authorized by this bill would represent a significant 
increase in DOE's program for MHK technologies and is 
significantly higher than either the FY 2012 Budget Request of 
$18 million or the FY 2010 Budget of $37 million.
    DOE already has several MHK systems engineering efforts 
underway, but the additional systems engineering required by S. 
630 would be used to accelerate these programs.
    S. 630 would also require DOE to devote more R&D funding to 
develop open interface standards. This would ensure consistent 
design and development and allow unbiased comparison between 
competing technologies to achieve optimal energy generation in 
resulting systems. As the U.S. market develops, it will be 
crucial to avoid the pitfalls seen in the development of MHK 
technologies in Europe, where, despite tremendous strides that 
have been made in device development and deployment, the 
interface standards with devices and data are still being 
developed.
    The creation of a competitive grant program for MHK RD&D 
test facilities would mimic similar innovative activities 
already sponsored by DOE for other renewable energy 
technologies. DOE is currently investing in three MHK test 
facilities that focus on the demonstration of multiple MHK 
technologies. Investment in these National Marine Renewable 
Energy Centers (NMRECs) is critically important in order to 
help MHK technologies realize their full potential and to 
support their rapid commercialization if done in an 
environmentally responsible way. Each Center is currently 
developing plans for the development of open-water test 
facilities. Further investment in NMRECs, as called for by this 
legislation, would enable the open-water test berths to be 
established. Third-party testing and evaluation of device 
performance and reliability would enable private sector 
investment in these emerging technologies.
    All three of DOE's existing NMRECs are unrestricted in 
terms of the device types they develop and support. Although 
none are geographically located for in-stream testing, tidal 
device research and development can substitute. It is 
unnecessary to distinguish between ``marine'' and 
``hydrokinetic'' centers as the existing NMRECs could conduct 
research on any type of device.
    On June 29, 2010, the Department of Energy and the 
Department of the Interior (DOI) signed an MOU for the 
coordinated deployment of renewable energy technologies on the 
OCS. The MOU's Action Plan includes a number of MHK-related 
activities, including coordination of studies and other 
activities to support future BOEMRE-issued MHK research leases, 
the development of environmental monitoring and mitigation 
protocols and collaboration on environmental study efforts, and 
development of a plan for MHK resource management and 
prediction. Additionally, on August 3, 2010, DOE announced the 
designation of Florida Atlantic University (FAU) as a national 
center for ocean energy research and development. With this 
designation, DOE awarded the new Southeast National Marine 
Renewable Energy Center $250,000 to undertake research and 
development of technologies capable of generating power from 
ocean currents and ocean thermal energy. FAU has applied for a 
five-year limited lease under BOEMRE's Interim Policy. If 
issued, this lease would allow for limited testing of ocean 
current devices on the OCS offshore Florida. DOE has also 
provided funding to the Northwest National Marine Renewable 
Energy Center to aid in the development of facilities to serve 
as an integrated, standardized test center for developers of 
wave and tidal energy, and the Hawaii National Marine Renewable 
Energy Center for the development of a site for the testing of 
wave energy conversion devices and ocean thermal energy 
conversion systems. DOE may seek to obtain research leases from 
DOI.
    If funding is realized under S. 630, development of MHK 
technologies would be accelerated, speeding their 
transformation from promising but fledgling technologies to 
commercially viable, clean, renewable energy sources.
Title I, Subtitle D of the American Clean Energy Leadership Act of 2009
    Title I, Subtitle D of ACELA contains provisions that would 
create an energy-water clean technology grant program in DOE 
and would require several studies on the energy-water nexus.
    The grant program created under ACELA could serve as a 
useful way to spur industry to devote time and resources to 
develop strategies to minimize water consumption in energy 
processes. These provisions would also require DOE and other 
agencies to collaborate on several studies on this subject. The 
study that would be run by the Natural Academy of Sciences 
regarding the effects of energy development and production on 
U.S. water resources would be a useful, in-depth analysis. 
However, in this legislation, the analysis appears limited to a 
current assessment. While this in itself would be useful, DOE 
recommends that any such study also consider the expected 
increase in water demand from projected growth in energy 
production, and the water implications of moving to a clean 
energy economy. This will be especially important since certain 
clean energy technologies (carbon capture and storage, 
bioenergy, concentrated solar power, etc.) may result in 
increased water demands. The effects of climate change on water 
availability should also be analyzed in order to better 
understand the potential vulnerability of the energy sector to 
water constraints.
    One of the other studies included in ACELA would require 
the Department of the Interior (DOI) to evaluate the amount of 
energy used in water storage and delivery operations. This 
study would be useful, but DOE suggests that the proposed study 
would benefit from consultation with other agencies with 
expertise in the energy-water area, including DOE.
    In general, interagency consultation must be an integral 
component of our national strategy to address the energy-water 
nexus. Along with energy production, agriculture uses more 
water than any other sector in the U.S., so engagement with the 
U.S. Department of Agriculture will be essential. The U.S. Army 
Corps of Engineers must also play a vital role in developing 
more efficient water usage strategies. DOE welcomes efforts to 
build on existing collaborations with these and other agencies, 
such as the MOU referenced above.
    These provisions would also require DOE to develop an 
Energy-Water R&D Roadmap to define future RD&D and 
commercialization efforts necessary to address emerging water-
related challenges to future clean energy generation and 
production. DOE has already produced a report examining these 
issues, which it transmitted to Congress in January of 2007, 
and has developed a follow-up report, ``Energy-Water Challenges 
and Research and Development Issues,'' that we expect will be 
finalized and transmitted to Congress shortly.
Conclusion
    In conclusion, I would like to again thank this Committee 
for its leadership in supporting both conventional hydropower 
and MHK energy technologies and in confronting the challenges 
associated with the interrelation of our energy and water 
consumption.
    As Secretary Chu stated last year, ``While hydropower is 
the largest source of renewable electricity in the nation, 
hydropower capacity has not increased significantly in decades. 
As the single largest owner of hydropower generation in the 
United States, it is important for the federal government to 
tap this valuable asset so it can continue to contribute to our 
clean energy portfolio and energy security.''\13\ S. 629 and S. 
630 both contain provisions that would help realize this goal; 
however, both bills contain authorizations significantly in 
excess of the 2012 Budget request within EERE for Water 
Programs. The President's FY 2012 budget represents DOE's 
priorities for applied R&D in energy efficiency and renewable 
energy technologies.
---------------------------------------------------------------------------
    \13\http://www.energy.gov/news/8793.htm.
---------------------------------------------------------------------------
    Transitioning to a clean energy economy will be greatly 
enhanced if we also identify ways to minimize or eliminate 
water use associated with energy generation. The ACELA 
provisions could be the catalyst to finding these solutions.
    I would be pleased to address any questions the Committee 
might have.

   Testimony of Jeff C. Wright, Director, Office of Energy Projects, 
                  Federal Energy Regulatory Commission

Chairman Bingaman, Ranking Member Murkowski, and Members of the 
Committee:

    My name is Jeff Wright and I am the Director of the Office 
of Energy Projects at the Federal Energy Regulatory Commission 
(Commission or FERC). I appreciate the opportunity to appear 
before you to discuss S. 629, S. 630, and S. 1462. As a member 
of the Commission's staff, the views I express in this 
testimony are my own, and not those of the Commission or of any 
individual Commissioner.


                             I. BACKGROUND


    The Commission regulates over 1,600 hydropower projects at 
over 2,500 dams pursuant to Part I of the Federal Power Act 
(FPA). Together, these projects represent 54 gigawatts of 
hydropower capacity, more than half of all the hydropower in 
the United States. Hydropower is an essential part of the 
Nation's energy mix and offers the benefits of an emission-
free, renewable, domestic energy source with public and private 
capacity together totaling about nine percent of U.S. electric 
generation capacity.
    Under the FPA, non-federal hydropower projects must be 
licensed by the Commission if they: (1) are located on a 
navigable waterway; (2) occupy federal lands; (3) use surplus 
water from a federal dam; or (4) are located on non-navigable 
waters over which Congress has jurisdiction under the Commerce 
Clause, involve post-1935 construction, and affect interstate 
or foreign commerce.
    The FPA authorizes the Commission to issue either licenses 
or exemptions for projects within its jurisdiction. Licenses 
are generally issued for terms of between 30 and 50 years, are 
renewable, and carry with them the right to exercise federal 
eminent domain to obtain property necessary for the 
construction, operation, and maintenance of a project. 
Exemptions are perpetual, and thus do not need to be renewed, 
but do not permit the use of eminent domain. Congress has 
established two types of exemptions. First, section 30 of the 
FPA allows the Commission to issue exemptions for projects that 
utilize for generation only the hydroelectric potential of 
manmade conduits that are operated for the distribution of 
water for agricultural, municipal, or industrial consumption, 
and not primarily for the generation of electricity. Conduit 
projects must be located on nonfederal lands, and have a 
maximum capacity of 15 megawatts (40 megawatts if the exemptee 
is a state or local government entity). Second, in section 
405(d) of the Public Utility Regulatory Policies Act, Congress 
authorized the Commission to grant exemptions for small 
hydroelectric power projects having an installed capacity of 
5,000 kilowatts or less. To qualify for this type of exemption, 
a project must be located at an existing dam that does not 
require construction or the enlargement of an impoundment, or 
must use the hydropower potential of a natural water feature, 
such as a waterfall. Both types of exemptions are subject to 
mandatory fish and wildlife conditions provided by federal and 
state resource agencies.
    The Commission has established three licensing processes, 
with the intent of allowing parties to select the process that 
is best suited to individual proceedings. The integrated 
licensing process (ILP) frontloads issue identification and 
environmental study to the period before an application is 
filed, and is thus well-suited to complex cases with 
substantial issues. The alternative licensing process (ALP) 
allows participants significant flexibility to tailor licensing 
procedures in a manner that may work well for unique cases. The 
traditional licensing process (TLP), in which environmental and 
other work can occur after the application is filed appears to 
work best for less controversial matters. The TLP may be the 
process that is best-suited for many simple cases involving 
exemptions or small, low impact licenses. Commission staff has 
also developed a pilot licensing process for hydrokinetic 
projects in which, with the assistance of federal and state 
resource agencies, a project can be licensed in as little as 
six months.
    It is extremely important to note that project developers 
and other stakeholders, not the Commission, in most instances 
play the leading role in determining project success and 
whether the regulatory process will be short or long, simple or 
complex. The first key issue is site selection and proposed 
project operation. For example, the processing of applications 
tends to be expedited when applicants propose projects that: 
(1) are located at an existing dam where hydropower facilities 
do not currently exist, (2) would result in little change to 
water flow and use, (3) are unlikely to affect threatened and 
endangered species and are unlikely to need fish passage 
facilities, and (4) involve lands and facilities that are 
already owned by the applicant. To the extent that a proposed 
project, even one of small size, raises concerns about water 
use and other environmental issues, it may be difficult for the 
Commission to quickly process an application. It is important 
to remember that the small capacity of a proposed project does 
not necessarily mean that the project has only minor 
environmental impacts.
    Another, and related, factor is the extent to which project 
developers reach out to affected stakeholders. If a developer 
contacts concerned citizens, local, state, and federal 
agencies, Indian tribes, and environmental organizations, and 
works with them to develop consensus as to what information is 
needed to understand the impacts of a project and what 
environmental measures may be appropriate, and to develop 
support for the project, the application and review process is 
likely to be simpler and quicker. Where a project comes as a 
surprise to affected entities or where a developer does not 
respond to expressed concerns, the Commission's job becomes 
much more difficult, because the Commission must, and does, 
ensure that all expressed concerns are addressed.
    A final, and again related, matter is the development of 
the full record that the Commission needs to act on an 
application. A potential applicant needs to work with 
Commission staff and with federal and state resource agencies 
and other stakeholders to determine what information is needed 
to support an application, and to provide the Commission with a 
complete application. Where Commission staff or other 
stakeholders must ask an applicant to provide information that 
is missing from an application, the regulatory process slows 
down.
    The other entities with roles in the licensing and 
exemption process regarding small hydropower projects are also 
key to its success. The quickest, most efficient process can be 
achieved only where federal and state agencies, as well as 
other stakeholders, devote the resources early on to help 
project review move ahead, and where they display the 
flexibility to look at the merits of individual projects and 
the willingness to shorten the process in appropriate cases. 
Commission staff is dedicated to making the regulatory process 
as short and cost-effective as possible. We can only do that 
where applicants, resource agencies, and other stakeholders 
serve as willing partners in the process.


     II. COMMISSION EFFORTS REGARDING SMALL AND INNOVATIVE PROJECTS


    The majority of the hydropower projects regulated by the 
Commission are small projects, with about 71 percent having an 
installed capacity of 5 megawatts (MW) or less. In recent 
years, the Commission has seen a greatly increased interest in 
small hydropower projects, in innovative hydrokinetic projects, 
and in pumped storage projects, particularly closed loop pumped 
storage, which does not involve regular water withdrawals from 
rivers or other water sources. The Commission has responded by 
implementing a number of measures to facilitate efficient 
review of project proposals. In 2007, in order to provide 
personalized, responsive service to entities seeking to develop 
small hydropower projects, Commission staff established a 
dedicated phone line and email address for inquiries on small 
hydropower, developed a brochure to provide guidance to 
potential developers of small, low impact hydropower projects, 
and put these resources and a list of frequently-asked 
questions on the Commission's website.
    In light of the continued growing interest in such 
development, the Commission held a technical conference on 
December 2, 2009, at its Washington, D.C. headquarters to 
explore issues related to licensing, and exempting from 
licensing, small non-federal hydropower projects in the U.S. 
The December technical conference generated discussion on 
recommendations that could improve the process for authorizing 
small hydropower projects. In addition to insights received 
from the panelists and attendees at the December conference, 
written comments were solicited and over 40 comment letters 
were received from industry representatives; federal, state, 
and local agencies; private citizens; and non-governmental 
organizations. At the Commission's April 15, 2010 meeting, 
staff reported on the conference and the comments received, and 
presented an action plan to assist and expedite the review of 
small hydropower proposals. The action plan adopted the 
following immediate changes: (1) adding new web-based resources 
to the Commission's website (www.ferc.gov) to make it easier 
for applicants to understand and complete the licensing 
process; (2) updating or creating Memoranda of Understanding 
(MOUs) with other agencies to improve coordination; (3) 
continuing our small hydropower hotline and email address to 
answer applicant questions; and (4) educating potential small 
hydropower developers through a new education and outreach 
program.
    The Commission has, under its small hydro initiative, held 
numerous outreach meetings with small hydropower developers and 
interested stakeholders, and implemented web based tools, such 
as conduit application templates and application checklists, 
which potential applicants can use to prepare their 
applications. The small hydro website further contains guidance 
and sample letters that applicants can use to obtain waivers 
from fish and wildlife agencies for part of the prefiling 
consultation process. The Commission staff has also relaxed 
some of the standards, under Section 4.39 of its regulations, 
for exhibits and drawings for conduit applications. For those 
applicants that have filed complete and adequate applications, 
and for which the Commission has determined that impacts are 
minimal, the Commission has reduced the public notice period 
from 60 days to 30 days and the reply period from 45 days to 15 
days. A number of conduit exemptions have been approved in as 
short as two months from the date that an application has been 
deemed complete.
    Since the April 15, 2010 Commission meeting, we have signed 
an MOU with the State of Colorado to expedite the small hydro 
licensing process (August 2010); launched a small hydro program 
website (August 2010); participated in small hydro workshops in 
Oregon (September 2010), Massachusetts (October 2010), and New 
Hampshire November 2010); conducted two webinars on our small 
hydro website (November/December 2010); and updated our small 
hydro brochure. Upcoming outreach efforts will include: 
participating in small hydro workshops in Washington, DC, 
Vancouver, BC, and California as well as conducting another 
webinar this summer. We have also completed an update on our 
MOU with the Army Corps of Engineers.
    The MOU with the State of Colorado provides an excellent 
example of a Federal-State solution for developing a pilot 
process to find flexible and innovative ways to reduce barriers 
to small hydro and conduit project development. In order to 
facilitate the Commission approval of such projects, the MOU 
provides that Colorado will prescreen any proposals and ensure 
that the applications are complete and meet Commission 
regulations before they are filed.
    With this background, I will turn to the draft legislation.


                              III. S. 629


    S. 629, the Hydropower Improvement Act of 2011, has the 
laudable goal of increasing hydropower capacity and generation 
in United States. I strongly support that goal, and offer 
comments on specific sections of the bill.
A. Sections 5 and 6
    Sections 5 and 6 of the bill would authorize the Secretary 
of Energy to issue grants to increase hydropower generation, 
and to support hydropower research, development, and 
demonstration projects. I support these sections, which would 
assist in the development of additional renewable energy.
B. Section 7
    Section 7 would require the Commission to investigate the 
feasibility of implementing a two-year licensing process, in 
particular, with respect to hydropower development at existing, 
non-powered dams, and for closed-loop pumped storage projects.
    I support the goal of an expedited licensing process. 
Indeed, as I have discussed, it is Commission staff's goal to 
act on all license applications as quickly as possible, and the 
Commission has established processes that allow for great 
flexibility and efficiency. I am thus not certain whether an 
additional licensing process is necessary. During the last few 
years, we have been able to issue some licenses in a matter of 
a few months, where the project proponent had selected a site 
wisely, stakeholders had agreed on information needs, and state 
and federal agencies performed their responsibilities quickly. 
Moreover, the Commission operates under significant constraints 
imposed by the FPA, and by other legislation affecting the 
licensing process--the Clean Water Act, Coastal Zone Management 
Act, Endangered Species Act, and National Historic Preservation 
Act among them. In the absence of the ability to waive sections 
of the FPA and other acts, or to set enforceable schedules in 
licensing proceedings, it is not clear that the Commission, 
under its existing authorities, can mandate a shortened 
process.
C. Section 8
    Section 8 would establish various measures to promote 
conduit and small hydropower projects. Again, this goal is 
consistent with Commission policy and has been a major focus of 
Commission's staffs effort in the last few years.
    Section 8(a)(1) would amend section 30 of the FPA to allow 
conduit projects to be located on federal lands. I support this 
provision, which would remove the current bar on siting conduit 
projects on federal lands. This section would also amend the 
FPA to provide conditioning authority to federal land 
management agencies. These agencies already have the ability to 
impose conditions on proposed projects through the requirement 
that developers obtain special use authorizations under the 
Federal Land Management and Policy Act, so this amendment may 
not alter the current regulatory regime. As a general matter, 
however, I do have some concern that authorizing additional 
mandatory conditioning authority may slow down the licensing 
process and result in increased potential bars to hydropower 
development.
    Section 8(a)(3) would require the Commission and the 
Commissioner of Reclamation to conduct regional public 
workshops on reducing barriers to conduit hydropower projects 
and thereafter report any recommendations to Congress. We have 
worked successfully with the Bureau of Reclamation in the past 
and are prepared to join Reclamation in this effort.
    Section 8(b) would require the Commission to conduct 
regional public workshops on reducing barriers to small 
hydropower projects, and to report the results of this effort 
to Congress. Noting the outreach efforts described above, we 
are prepared to undertake this additional effort should 
Congress deem it helpful.
D. Section 9
    Section 9 would amend the FPA to authorize the Commission 
to extend the term of a preliminary permit issued under FPA 
section 5 once for up to two years. Preliminary permits grant 
the permittee a ``first-to-file'' preference with respect to 
license applications for projects being studied under a permit. 
Commission staff has heard anecdotally that developers are 
concerned that the need for environmental studies in some 
instances makes it difficult to complete a license application 
within the current maximum three-year term of a permit, with 
the result that a developer which has invested substantial time 
and money studying a project may face the possibility of losing 
its project based on competition from other entities--
particular those with statutorily-granted municipal 
preference--if it needs to seek a subsequent permit. I 
therefore support the proposed FPA amendment, which could 
ameliorate this problem. It might be worth considering, as an 
alternative, authorizing the Commission to issue permits for 
terms of up to five years, which could avoid the need for 
developers to go through the process of seeking an extension.
E. Section 10
    Section 10 would require the Commissioner of Reclamation, 
in consultation with the Commission, to study barriers to non-
federal hydropower development at Bureau of Reclamation 
projects and to develop a memorandum of understanding to 
improve the coordination and timeliness of such development. We 
have already begun working with the Bureau of Reclamation on 
this matter, and we have no objection to Section 10.


 IV. THE MARINE AND HYDROKINETIC RENEWABLE ENERGY PROMOTION ACT OF 2011


    S. 630 would authorize the Secretary of Energy to take 
various steps to promote marine and hydrokinetic renewable 
energy technology. As a general matter, the bill is consistent 
with the Commission's initiatives to support the development of 
appropriate marine and hydrokinetic projects, which I have 
previously described. I have only two comments on the bill.
    Section 3 of S. 630 would allow the Secretary of Energy to 
issue grants to support national testing facilities for marine 
and hydrokinetic technology research, development, and 
demonstration. Commission staff has informally discussed this 
concept with DOE staff over the last year or so, and I believe 
that testing centers could be extremely helpful in the 
development of new renewable technologies. Section 3 provides 
that test centers may be nonprofit institutions, state or local 
governments, national laboratories, or National Marine 
Renewable Energy Research, Development, and Demonstration 
Centers established pursuant to section 634 of the Energy 
Independence and Security Act of 2007. The Federal Power Act 
contains no provisions allowing the Commission to authorize the 
testing of jurisdictional hydropower facilities; accordingly, 
with some limited exceptions, tests centers operated by private 
entities or by state and local government may be required to be 
licensed by the Commission. Moreover, if a test center were to 
use a variety of technologies with differing environmental 
impact, the Commission might be required to issue separate 
authorizations for individual tests. This would not be the case 
for centers under the aegis of other federal entities, such as 
DOE, which do not fall within the Commission's jurisdiction. 
Therefore, to allow for the maximum flexibility and simplicity, 
it may be worth considering either placing any test centers 
under the authority of DOE or another federal agency or 
providing an exemption from the provisions of Part I of the FPA 
for such test centers.
    Second, section 6 of the bill would authorize the Secretary 
of Energy to issue grants to advance the development of marine 
and hydrokinetic renewable energy; to help fund the costs of 
environmental analysis, the collection and dissemination of 
environmental data; and to support demonstration projects. The 
provision of grant funding to address the environmental 
information needs surrounding these new technologies directly 
addresses an issue of concern to federal agencies and other 
stakeholders. Environmental information is essential to the 
development and regulation of energy projects, yet, because 
marine and hydrokinetic technology is relatively new, and 
because these projects may be sited in areas, such as coastal 
zones, where the environment is not as well understood as 
onshore areas, much necessary information has yet to be 
developed. The cost of obtaining environmental information 
falls in large part on pioneering developers, and may thus 
discourage their efforts. The Commission and other federal 
agencies are partnering to reduce this burden by assembling and 
sharing environmental information. However, there are still 
issues which will require new studies, some of which are 
relevant to many developers. Federal funding to support 
gathering such information will help the regulatory process and 
advance the development of the technology as a whole.


          V. THE AMERICAN CLEAN ENERGY LEADERSHIP ACT OF 2009


    Title I, subtitle D of the American Clean Energy Leadership 
Act deals with the integration of energy and water resources. 
While this subtitle would not impose any direct requirements on 
the Commission, I note that the Commission recognizes the link 
between energy development and the use of our Nation's water 
resources. In siting natural gas and hydropower projects, the 
Commission conducts thorough analyses of the impact of proposed 
projects on water resources, authorizes only those projects 
that appropriately balance energy development and environmental 
protection, and imposes mitigation measures to ensure that 
approved projects are developed in an environmentally 
responsible manner.


                            VIII. CONCLUSION


    There is a great deal of potential for the development of 
additional hydropower projects throughout the country, 
including small projects and marine and hydrokinetic projects. 
Working within the authority given it by Congress, the 
Commission continues to adapt its existing, flexible procedures 
to facilitate the review and, where appropriate, the approval 
of such projects. Commission staff remains committed to 
exploring with project developers, its sister federal agencies, 
Indian tribes, the states, local government, and other 
stakeholders every avenue for the responsible development of 
our nation's hydropower potential. The legislation under 
consideration will, as I have testified, assist in realizing 
that potential.
    This concludes my remarks. I would be pleased to answer any 
questions you may have.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as ordered reported, are shown as follows (existing 
law proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics existing law in which no change is 
proposed is shown in roman):

              ENERGY INDEPENDENCE AND SECURITY ACT OF 2007


             Public Law 110-140, Approved December 19, 2007


AN ACT To move the United States toward greater energy independence and 
   security, to increase the production of clean renewable fuels, to 
 protect consumers, to increase the efficiency of products, buildings, 
and vehicles, to promote research on and deploy greenhouse gas capture 
   and storage options, and to improve the energy performance of the 
               Federal Government, and for other purposes

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

           *       *       *       *       *       *       *


SEC. 633. MARINE AND HYDROKINETIC RENEWABLE ENERGY RESEARCH AND 
                    DEVELOPMENT.

    (a) In General.--The Secretary, in consultation with the 
Secretary of the Interior and the Secretary of Commerce, acting 
through the Under Secretary of Commerce for Oceans and 
Atmosphere, shall establish a program of research, development, 
demonstration, and commercial application to expand marine and 
hydrokinetic renewable energy production, including programs 
to--
          (1) study and compare existing marine and 
        hydrokinetic renewable energy technologies;
          (2) research, develop, and demonstrate marine and 
        hydrokinetic renewable energy systems and technologies;
          (3) reduce the manufacturing and operation costs of 
        marine and hydrokinetic renewable energy technologies;
          (4) investigate efficient and reliable integration 
        with the utility grid and intermittency issues;
          (5) advance wave forecasting technologies;
          (6) conduct experimental and numerical modeling for 
        optimization of marine energy conversion devices and 
        arrays;
          (7) increase the reliability and survivability of 
        marine and hydrokinetic renewable energy technologies, 
        including development of corrosive-resistant materials;
          (8) identify, in conjunction with the Secretary of 
        Commerce, acting through the Under Secretary of 
        Commerce for Oceans and Atmosphere, and other Federal 
        agencies as appropriate, the potential environmental 
        impacts, including potential impacts on fisheries and 
        other marine resources, of marine and hydrokinetic 
        renewable energy technologies, measures to prevent 
        adverse impacts, and technologies and other means 
        available for monitoring and determining environmental 
        impacts;
          (9) identify, in conjunction with the Secretary of 
        the Department in which the United States Coast Guard 
        is operating, acting through the Commandant of the 
        United States Coast Guard, the potential navigational 
        impacts of marine and hydrokinetic renewable energy 
        technologies and measures to prevent adverse impacts on 
        navigation;
          (10) develop power measurement standards for marine 
        and hydrokinetic renewable energy;
          (11) develop identification standards for marine and 
        hydro-kinetic renewable energy devices;
          (12) address standards development, demonstration, 
        and technology transfer for advanced systems 
        engineering and system integration methods to identify 
        critical interfaces;
          (13) identifying opportunities for cross 
        fertilization and development of economies of scale 
        between other renewable sources and marine and 
        hydrokinetic renewable energy sources; [and]
          (14) providing public information and opportunity for 
        public comment concerning all technologies[.]; and
          (15)(A) apply advanced systems engineering and 
        systems integration methods to identify critical 
        interfaces and develop open standards for marine and 
        hydrokinetic renewable energy;
          (B) transfer the resulting environmental data to 
        industry stakeholders as public information through 
        published interface definitions, standards, and 
        demonstration projects; and
          (C) develop incentives for industry to comply with 
        the standards.
    (b) Reports.--Not later than 18 months after the date of 
enactment of this Act, the Secretary, in conjunction with the 
Secretary of Commerce, acting through the Undersecretary of 
Commerce for Oceans and Atmosphere, and the Secretary of the 
Interior, shall provide to the Congress a report that 
addresses--
          (1) the potential environmental impacts, including 
        impacts to fisheries and marine resources, of marine 
        and hydrokinetic renewable energy technologies;
          (2) options to prevent adverse environmental impacts;
          (3) the potential role of monitoring and adaptive 
        management in identifying and addressing any adverse 
        environmental impacts; and
          (4) the necessary components of such an adaptive 
        management program
    (c) Test Facilities.--
          (1) In general.--In carrying out this section, not 
        later than 180 days after the date of enactment of this 
        subsection, the Secretary shall award competitive 
        grants to support 4 or more geographically dispersed 
        marine and hydrokinetic renewable energy technology 
        research, development, and demonstration test 
        facilities for the demonstration of multiple 
        technologies in actual operating environments operating 
        marine environments (including industry 
        demonstrations).
          (2) Preference.--In awarding competitive grants under 
        this subsection, the Secretary shall give preference to 
        existing marine and hydrokinetic testing facilities and 
        existing Centers established under section 634.
          (3) Facilities.--Grants under this subsection may 
        support--
                  (A) modification of an existing facility 
                (including a Center established under section 
                634); or
                  (B) construction of a new test facility.
          (4) Program objectives.--In awarding grants under 
        this subsection, the Secretary shall provide for the 
        demonstration of--
                  (A) a variety of technologies at each test 
                facility;
                  (B) a variety of technologies among all of 
                the test facilities established; and
                  (C) technologies on a variety of scales.
          (5) Activities.--Each test facility established under 
        this subsection shall--
                  (A) provide infrastructure and resources for 
                the evaluation and technical viability testing 
                of marine and hydrokinetic renewable energy 
                technologies; and
                  (B) conduct and support research, 
                development, and demonstration activities with 
                respect to marine and hydrokinetic renewable 
                energy technologies.
          (6) Eligibility.--To be eligible for a grant under 
        this subsection, an applicant for a grant shall--
                  (A) be--
                          (i) a nonprofit institution;
                          (ii) a State or local government;
                          (iii) an institution of higher 
                        education;
                          (iv) a university consortium;
                          (v) a National Laboratory; or
                          (vi) a Center established under 
                        section 634; and
                  (B) demonstrate to the satisfaction of the 
                Secretary the ability and intention to--
                          (i) combine expertise from relevant 
                        academic fields, including fields 
                        relating to--
                                  (I) the environment;
                                  (II) marine and riverine 
                                sciences;
                                  (III) energy;
                                  (IV) ocean engineering; and
                                  (V) electrical, mechanical, 
                                and civil engineering; and
                          (ii) partner with other entities 
                        (including industry) that have 
                        expertise in advancing marine and 
                        hydrokinetic renewable energy 
                        technologies.

SEC. 634. NATIONAL MARINE AND HYDROKINETIC RENEWABLE ENERGY RESEARCH, 
                    DEVELOPMENT, AND DEMONSTRATION CENTERS.

    (a) Centers.--The Secretary shall award grants to 
institutions of higher education (or consortia thereof) for the 
establishment of 1 or more National Marine and Hydrokinetic 
Renewable Energy Research, Development, and Demonstration 
Centers. In selecting locations for Centers, the Secretary 
shall consider sites that meet one of the following criteria:
          (1) Hosts an existing marine renewable energy 
        research and development program in coordination with 
        an engineering program at an institution of higher 
        education.
          (2) Has proven expertise to support environmental and 
        policy-related issues associated with harnessing of 
        energy in the marine environment.
          (3) Has access to and utilizes the marine resources 
        in the Gulf of Mexico, the Atlantic Ocean, or the 
        Pacific Ocean.
The Secretary may give special consideration to historically 
black colleges and universities and land grant universities 
that also meet one of these criteria. In establishing criteria 
for the selection of the Centers, the Secretary shall consult 
with the Secretary of Commerce, acting through the Under 
Secretary of Commerce for Oceans and Atmosphere, on the 
criteria related to ocean waves, tides, and currents including 
those for advancing wave forecasting technologies, ocean 
temperature differences, and studying the compatibility of 
marine renewable energy technologies and systems with the 
environment, fisheries, and other marine resources.
    [(b) Purposes.--The Centers shall advance research, 
development, demonstration, and commercial application of 
marine renewable energy, and shall serve as an information 
clearinghouse for the marine renewable energy industry, 
collecting and disseminating information on best practices in 
all areas related to developing and managing enhanced marine 
renewable energy systems resources.]
    (b) Purposes.--The Centers--
          (1) shall--
                  (A) advance research, development, 
                demonstration, and commercial application of 
                marine and hydrokinetic renewable energy 
                technologies; and
                  (B) serve as information clearinghouses for 
                the marine and hydrokinetic renewable energy 
                industry by collecting and disseminating 
                information on best practices in all areas 
                relating to developing and managing marine and 
                hydrokinetic renewable energy technologies; and
          (2) may serve as technology test facilities 
        established under section 633(c).
    (c) Demonstration of Need.--When applying for a grant under 
this section, an applicant shall include a description of why 
Federal support is necessary for the Center, including evidence 
that the research of the Center will not be conducted in the 
absence of Federal support.

           *       *       *       *       *       *       *


SEC. 635. MARINE-BASED ENERGY DEVICE VERIFICATION PROGRAM.

    (a) Establishment.--The Secretary shall establish a marine-
based energy device verification program to provide a bridge 
from the marine and hydrokinetic renewable energy capture 
device design and development efforts underway across the 
industry to commercial deployment of marine and hydrokinetic 
renewable energy devices.
    (b) Purposes.--The purposes of the program are to fund, 
facilitate the development and installation of, and evaluate 
marine and hydrokinetic renewable energy projects, in 
partnership with Federally Funded Research and Development 
Centers, and in conjunction with Centers established under 
section 634, universities and other institutions of higher 
education, private business entities, and other appropriate 
organizations, in order--
          (1) to increase marine and hydrokinetic renewable 
        energy experience; and
          (2) to build and operate enough candidate devices to 
        obtain statistically significant operating and 
        maintenance data.
    (c) Objectives.--The objectives of the program shall 
include--
          (1) verifying the performance, reliability, 
        maintainability, and cost of new marine and 
        hydrokinetic renewable energy device designs and system 
        components in an operating environment;
          (2) providing States, regulators, utilities, and 
        other stakeholders with a valid opportunity to test and 
        evaluate marine and hydrokinetic renewable energy 
        technology in new areas;
          (3) documenting and communicating the experience from 
        those projects for the benefit of utilities, 
        independent power producers, other nonutility 
        generators, device suppliers, and others in the marine 
        and hydrokinetic renewable energy development 
        community; and
          (4) resolving environmental issues through robust 
        characterization, reliable impact prediction, effective 
        monitoring, development, and use of adaptive 
        management, and informing engineering design to improve 
        environmental performance.

SEC. 636. ADAPTIVE MANAGEMENT AND ENVIRONMENTAL GRANT PROGRAM.

    (a) Findings.--Congress finds that--
          (1) the use of marine and hydrokinetic renewable 
        energy technologies can reduce contributions to global 
        warming;
          (2) marine and hydrokinetic renewable energy 
        technologies can be produced domestically;
          (3) marine and hydrokinetic renewable energy is a 
        nascent industry; and
          (4) the United States must work to promote new 
        renewable energy technologies that reduce contributions 
        to global warming gases and improve domestic energy 
        production.
    (b) Grant Program.--
          (1) In general.--As soon as practicable after the 
        date of enactment of this subsection, the Secretary 
        shall establish a program under which the Secretary 
        shall award grants to eligible entities--
                  (A) to advance the development of marine and 
                hydrokinetic renewable energy;
                  (B) to help fund the costs of environmental 
                analysis affecting the deployment of marine 
                hydrokinetic devices;
                  (C) to help enable the eligible entities--
                          (i) to gather and collect the types 
                        of environmental data that are required 
                        when working in a public resource 
                        (including the waterways and oceans of 
                        the United States); and
                          (ii) to monitor the impacts of 
                        demonstration projects and make the 
                        resulting information available for 
                        widespread dissemination to aid future 
                        projects; and
                  (D) to help fund the cost of advancing 
                renewable marine and hydrokinetic technologies 
                in ocean and riverine environments from 
                demonstration projects to development and 
                deployment.
          (2) Application.--To be eligible to receive a grant 
        under this paragraph, an entity shall submit to the 
        Secretary an application at such time, in such manner, 
        and containing such information as the Secretary may 
        require.

SEC. 637. ADMINISTRATION.

    (a) In General.--In carrying out this subtitle, the 
Secretary shall--
          (1) coordinate and avoid duplication of activities 
        across programs of the Department and other applicable 
        Federal agencies, including the National Laboratories;
          (2) collaborate with (as applicable)--
                  (A) industry;
                  (B) stakeholders;
                  (C) other Federal agencies, including the 
                National Laboratories;
                  (D) academic institutions; and
                  (E) international bodies with relevant 
                scientific expertise; and
          (3) obtain from the recipient of assistance and make 
        available to the public, through Web sites, reports, 
        and databases of the Department, any research, 
        development, demonstration, and commercial application 
        information produced with respect to supported 
        technology, including information obtained after the 
        completion of supported activities, except to the 
        extent that the information is protected from 
        disclosure under section 552(b) of title 5, United 
        States Code.
    (b) Reports.--Not later than 1 year after the date of 
enactment of this section and at least once every 2 years 
thereafter, the Secretary shall submit to Congress a report on 
findings and activities conducted under this subtitle.

SEC. 63[5]8. APPLICABILITY OF OTHER LAWS.

    Applicability of any requirement under any environmental or 
other Federal or State law.

SEC. 63[6]9. AUTHORIZATION OF APPROPRIATIONS.

    [There are authorized to be appropriated to the Secretary 
to carry out this subtitle $50,000,000 for each of the fiscal 
years 2008 through 2012, except that no funds shall be 
appropriated under this section for activities that are 
receiving funds under section 931(a)(2)(E)(i) of the Energy 
Policy Act of 2005 (42 U.S.C. 16231(a)(2)(E)(i)).]
    (a) In General.--There is authorized to be appropriated to 
carry out this subtitle, to remain available until expended--
          (1) $70,000,000 for fiscal year 2012; and
          (2) $75,000,000 for fiscal year 2013.
    (b) Renewable Energy Funds.--No funds shall be appropriated 
under this section for activities that are receiving funds 
under section 931(a)(2)(E)(i) of the Energy Policy Act of 2005 
(42 U.S.C. 16231(a)(2)(E)(i)).

           *       *       *       *       *       *       *


SEC. 803. [RENEWABLE ENERGY DEPLOYMENT] NATIONAL RENEWABLE ENERGY 
                    DEPLOYMENT PROGRAM. 

    (a) Definitions.--In this section:
          [(1) Alaska small hydroelectric power.--The term 
        ``Alaska small hydroelectric power'' means power that--
                  [(A) is generated--
                          [(i) in the State of Alaska;
                          [(ii) without the use of a dam or 
                        impoundment of water; and
                          [(iii) through the use of--
                                  [(I) a lake tap (but not a 
                                perched alpine lake); or
                                  [(II) a run-of-river screened 
                                at the point of diversion; and
                  [(B) has a nameplate capacity rating of a 
                wattage that is not more than 15 megawatts.]
          [(2)](1) Eligible applicant.--The term ``eligible 
        applicant'' means any--
                  (A) governmental entity;
                  (B) private utility;
                  (C) public utility;
                  (D) municipal utility;
                  (E) cooperative utility;
                  (F) Indian tribes; and
                  (G) Regional Corporation (as defined in 
                section 3 of the Alaska Native Claims 
                Settlement Act (43 U.S.C. 1602)).
          [(3)](2) Ocean energy.--
                  (A) Inclusions.--The term ``ocean energy'' 
                includes current, wave, and tidal energy.
                  (B) Exclusion.--The term ``ocean energy'' 
                excludes thermal energy.
          [(4)](3) Renewable energy project.--The term 
        ``renewable energy project'' means a project--
                  (A) for the commercial generation of 
                electricity; and
                  (B) that generates electricity from--
                          (i) solar, wind, or geothermal energy 
                        or ocean energy;
                          (ii) biomass (as defined in section 
                        203(b) of the Energy Policy Act of 2005 
                        (42 U.S.C. 15852(b)));
                          (iii) landfill gas; or
                          (iv) [Alaska] small hydroelectric 
                        power.
          (4) Small hydroelectric power.--The term ``small 
        hydroelectric power'' means power that-- 
                  (A) is generated--
                          (i) without the use of a dam or 
                        impoundment of water; and
                          (ii) through the use of--
                                  (I) a lake tap (but not a 
                                perched alpine lake); or
                                  (II) a run-of-river screened 
                                at the point of diversion; and
                  (B) has a nameplate capacity rating of a 
                wattage that is not more than 15 megawatts.
    (b) Renewable Energy Construction Grants.--
          (1) In general.--The Secretary shall establish a 
        national renewable energy construction grants program 
        under which the Secretary shall use amounts 
        appropriated under this section to make grants for use 
        in carrying out renewable energy projects, including 
        feasibility studies for such projects.
          (2) Criteria.--Not later than 180 days after the date 
        of enactment of this Act, the Secretary shall set forth 
        criteria for use in awarding grants under this section.
          (3) Application.--To receive a grant from the 
        Secretary under paragraph (1), an eligible applicant 
        shall submit to the Secretary an application at such 
        time, in such manner, and containing such information 
        as the Secretary may require, including a written 
        assurance that--
                  (A) all laborers and mechanics employed by 
                contractors or subcontractors during 
                construction, alteration, or repair that is 
                financed, in whole or in part, by a grant under 
                this section shall be paid wages at rates not 
                less than those prevailing on similar 
                construction in the locality, as determined by 
                the Secretary of Labor in accordance with 
                sections 3141-3144, 3146, and 3147 of title 40, 
                United States Code; and
                  (B) the Secretary of Labor shall, with 
                respect to the labor standards described in 
                this paragraph, have the authority and 
                functions set forth in Reorganization Plan 
                Numbered 14 of 1950 (5 U.S.C. App.) and section 
                3145 of title 40, United States Code.
          (4) Non-federal share.--Each eligible applicant that 
        receives a grant under this subsection shall contribute 
        to the total cost of the renewable energy project 
        constructed by the eligible applicant an amount not 
        less than 50 percent of the total cost of the project.
          (5) Priority.--In making grants to eligible 
        applicants to carry out renewable energy projects under 
        this section, the Secretary shall give priority to 
        applicants that--
                  (A) have power costs that are 125 percent or 
                more of average national retail costs; and
                  (B) will use the grant to construct renewable 
                electricity projects to replace or partially 
                replace fossil fuel projects.
  (c) Authorization of Appropriations.--There are authorized to 
be appropriated to the Fund such sums as are necessary to carry 
out this section.

           *       *       *       *       *       *       *


             PUBLIC UTILITY REGULATORY POLICIES ACT OF 1978


       [Public Law 95-617, Approved November 9, 1978, as Amended]


AN ACT To suspend until the close of June 30, 1980, the duty on certain 
                 doxorubicin hydrochloride antibiotics

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

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Public 
Utility Regulatory Policies Act of 1978''.

           *       *       *       *       *       *       *


TITLE VI--MISCELLANEOUS PROVISIONS

           *       *       *       *       *       *       *



SEC. 609. RURAL AND REMOTE COMMUNITIES ELECTRIFICATION GRANTS.

           *       *       *       *       *       *       *


    (c) Grant Administration.--(1) The Secretary shall make 
grants under this section based on a determination of cost-
effectiveness and the most effective use of the funds to 
achieve the purposes described in subsection (b).
  (2) For each fiscal year, the Secretary shall allocate grant 
funds under this section equally between the purposes described 
in paragraphs (1) and (2) of subsection (b).
  (3) In making grants for the purposes described in subsection 
(b)(2), the Secretary shall give preference to renewable energy 
facilities.
    (d) Authorization of Appropriations.--There is authorized 
to be appropriated to the Secretary to carry out this section 
$20,000,000 for each of fiscal years 2006 through [2012] 2011.

                                  
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