[Federal Register Volume 79, Number 202 (Monday, October 20, 2014)]
[Notices]
[Pages 62608-62609]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-24919]


-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Office of Energy Efficiency and Renewable Energy


Wind and Water Power Program: Guidance for Hydroelectric 
Incentive Payments

AGENCY: Office of Energy Efficiency and Renewable Energy, Department of 
Energy.

ACTION: Notice of availability of draft guidance.

-----------------------------------------------------------------------

SUMMARY: The U.S. Department of Energy (DOE) invites public comment on 
a second version of its draft Guidance for EPAct 2005 Section 242 
Program. The guidance describes how DOE intends to provide incentive 
payments to the owners or operators of qualified hydroelectric 
facilities for electric energy generated and sold for a specified 10-
year period as authorized under section 242 of the Energy Policy Act of 
2005.

DATES: Comments regarding this draft guidance must be received on or 
before November 4, 2014.

ADDRESSES: Written comments may be sent to the Office of Energy 
Efficiency and Renewable Energy (EE-4), U.S. Department of Energy, 1000 
Independence Avenue SW., Washington, DC 20585-0121, or by email at 
[email protected].

FOR FURTHER INFORMATION CONTACT: Requests for additional information 
should be directed to Mr. Steven Lindenberg, Office of Energy 
Efficiency and Renewable Energy (EE-4), U.S. Department of Energy, 1000 
Independence Avenue SW., Washington, DC 20585-0121, (202) 586-2783, 
[email protected].

SUPPLEMENTARY INFORMATION: In the Energy Policy Act of 2005 (EPAct 
2005; Pub. L. 109-58) Congress established a new program to support the 
expansion of hydropower energy development at existing dams and 
impoundments through an incentive payment procedure. Under section 242 
of EPAct 2005, the Secretary of Energy is directed to provide incentive 
payments to the owner or operator of qualified hydroelectric facilities 
for electric energy generated and sold by a qualified hydroelectric 
facility for a specified 10-year period. (See 42 U.S.C. 15881) DOE has 
not made these incentive payments in the past due to a lack of 
appropriations for the hydroelectric production incentive. The 
conference report to the Fiscal Year 2014 Omnibus Appropriations bill, 
however, includes $3,600,000 for conventional hydropower under section 
242 of EPAct 2005.
    In response, DOE developed draft guidance intended to describe the 
application process and the information necessary for DOE to make a 
determination of eligibility under section 242. On July 2, 2014, DOE 
issued draft guidance for public comment. See 79 FR 37733 and http://energy.gov/eere/water/water-power-program. A summary of the comments 
and the DOE response is available at: http://energy.gov/eere/water/water-power-program. Based on the comments received and a re-
examination of the statutory intent of the program, DOE is proposing 
the following changes to the draft guidance and is accepting additional 
public comment:
     The definition of ``existing dam or conduit'' is amended 
to specify that generator penstocks associated with a new generator and 
a temporary increase in dam height that does not expand reservoir 
topographic area and is for purposes of flood control, hydroelectric 
generation efficiency improvement, and/or health and safety 
improvements would not eliminate facilities from eligibility.

[[Page 62609]]

     ``Qualified hydroelectric facility'' is redefined to 
recognize both conventional and new innovative technologies and that 
construction should not require any permanent enlargement of 
impoundment or diversion structure when installed.
     A definition for ``qualified kilowatt-hours'' is added.
     The definition of ``sale'' of electricity is amended to 
specify that not-for-profit electric cooperatives and municipal 
utilities are considered unrelated to their members for purposes of 
hydroelectric production incentive payments.
     Definitions in the guidance are appealable.
     The net electric energy generated and sold must either be 
metered or must be measured through an alternative means confirmed by a 
third party.
     A definition for ``first eligible for payment'' is added 
and defined as the first Federal fiscal year that a qualified 
hydroelectric facility operates to sell electric energy and this change 
is repeated in other relevant portions of the guidance.
    After receiving public comment asking for clarification about the 
date that hydropower facility owners or operators are first eligible 
for incentive payments, DOE reexamined the July draft guidance proposal 
that the 10-year eligibility period was to begin the first fiscal year 
in which the application for payment is made. The July draft guidance 
defined the period of eligibility to be ``the fiscal year in which 
application for payment for electricity generated by the facility is 
first made and the facility is determined by DOE to be eligible for and 
receives an incentive payment.'' See http://energy.gov/eere/water/water-power-program. DOE recognizes that the purpose of the section 242 
program is to incentivize new hydropower development and production. 
The statute envisioned 10 years of consecutive payments to stimulate 
such investment. Moreover, the incentive period mentioned in section 
242(a) refers to the period of 10 fiscal years that begins with the 
fiscal year in which the electric energy generated from the facility is 
first eligible for such payments. Hydroelectric facilities are first 
eligible for such payments the date these facilities meet the 
``qualified hydroelectric facility'' definition in section 242(b)(1), 
regardless of whether funds were appropriated in a given fiscal year. 
Congress only authorized appropriations for fiscal years 2006 through 
2015, though it did not actually provide funding prior to fiscal year 
2014, and limited the pool of qualified hydroelectric facilities to 
those that begin operation between fiscal years 2006 through 2015. DOE 
is now proposing that the 10-year period of eligibility begins the date 
a qualified hydroelectric facility begins operation and generates 
energy for sale (must be between fiscal year 2006 and fiscal year 2015) 
and ends 10 fiscal years from that date. (See 42 U.S.C. 15881(a)-(d)) 
DOE is accepting comments on this and all other aspects of the draft 
guidance.

    Issued in Washington, DC, on October 14, 2014.
 David Danielson,
Assistant Secretary, Energy Efficiency and Renewable Energy.
[FR Doc. 2014-24919 Filed 10-17-14; 8:45 am]
BILLING CODE 6450-01-P