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Calendar No. 471
107th Congress Report
2d Session 107-194
HYDRO-ELECTRIC LICENSES IN ALASKA
June 28, 2002.--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. 1843]
The Committee on Energy and Natural Resources, to which was
referred the bill (S. 1843) to extend certain hydro-electric
licenses in the State of Alaska, having considered the same,
reports favorably thereon without amendment and recommends that
the bill do pass.
PURPOSE OF THE MEASURE
The purpose of S. 1843 is to direct the Federal Energy
Regulatory Commission, upon request of the licensee, to issue
an order staying the license of a hydroelectric project in the
State of Alaska until the construction of an associated power
transmission line is completed. The Commission is also directed
to extend the deadline for commencing construction of the
project once the stay is lifted.
BACKGROUND AND NEED
Section 13 of the Federal Power Act requires a
hydroelectric licensee to commence the construction of its
project within 2 years of the date of the issuance of the
license. That deadline can be extended by the Federal Energy
Regulatory Commission one time for a maximum of 2 additional
years. If construction has not commenced by the end of the time
period, the licensee is terminated by the Commission unless
legislation authorizing an additional extension is enacted.
This legislation, in recognition of the need for construction
of a power transmission line in association with project No.
11393, directs the Commission to stay the license for the
project and extend the construction deadline once the stay is
The Federal Energy Regulatory Commission issued an original
license to the city of Saxman, Alaska on January 22, 1998, to
construct, operate, and maintain the 96-megawatt Mahoney Lake
Hydroelectric Project No. 11393 to be located on Upper Mahoney
Lake and Upper Mahoney Creek near Ketchikan in the Ketchikan
Gateway Borough of southeast Alaska. The original deadline for
commencement of the project was January 21, 2000. The
Commission extended this deadline until January 21, 2002.
Project No. 11393 includes the installation of a tap into
Upper Mahoney Lake, a 1,700-foot-long upper tunnel, a value
house, a buried bypass pipe, a 1,370-foot-long vertical shaft,
an 8-foot-diameter, 3,350-foot-long lower tunnel, a semi-
underground powerhouse, a 200-foot-long tailrace channel, 1.5
miles of buried, and 3.1 miles of overhead, transmission line,
a switchyard, and 2.6. miles of new access road.
S. 1843 was introduced by Senators Stevens and Murkowski on
December 18, 2001. The views of the Federal Regulatory
Commission were sought on January 30, 2002 and March 1 2002,
and provided by the Chairman of the Commission on March 19,
The Committee on Energy and Natural Resources, in open
business session on June 5, 2002, by a voice vote of a quorum
present, recommends that the Senate pass S. 1843, as described
Section 1 directs the Federal Energy Regulatory Commission,
upon licensee request, to (1) issue an order staying the
hydroelectric license for project No. 11393 in the State of
Alaska; (2) lift such stay not later than 6 years after the
date of the Commission receives written notice that
construction of the Swan-Tyee transmission line is completed;
and (3) extend for not more than three consecutive two-year
periods the time during which the licensee is require to
commence project construction.
COST AND BUDGETARY CONSIDERATIONS
The following estimate of the cost of this measure has been
provided by the Congressional Budget Office:
Congressional Budget Office,
Washington, DC, June 14, 2002.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for S. 1843, a bill to
extend certain hydroelectric licenses in the state of Alaska.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Lisa Cash
Barry B. Anderson
(For Dan L. Crippen, Director).
S. 1843--A bill to extend certain hydroelectric licenses in the state
CBO estimates that implementing S. 1843 would have no net
effect on the federal budget. The bill contains no
intergovernmental or private-sector mandates as defined in the
Unfunded Mandates Reform Act and would impose no costs on
state, local or tribal governments.
S. 1843 would authorize the Federal Energy Regulatory
Commission (FERC) to stay the license for hydroelectric project
number 11393 until a specific transmission line is constructed.
When the line is completed, FERC would be required to lift the
stay and extend the deadline for beginning construction of the
project for up to six years. This project is near Ketchican,
Alaska, and is subject to licensing by FERC. This provision may
have a minor impact on FERC's workload. Because FERC recovers
100 percent of its costs through user fees, any change in its
administrative costs would offset by an equal change in the
fees that the commission charges. Hence, the bill's provisions
would have no net budgetary impact.
Because FERC's administrative costs are set in annual
appropriations, enactment of this legislation would not affect
direct spending or receipts. Therefore, pay-as-you-go
procedures would not apply to S. 1843.
The CBO staff contact for this estimate is Lisa Cash
Driskill. This estimate was approved by Peter H. Fontaine,
Deputy 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. 1843. The bill is not a regulatory measure in
the sense of imposing Government-established standards or
significant economic responsibilities on private individuals
No personal information would be collected in administering
the program. Therefore, there would be no impact on personal
Little, if any, additional paperwork would result from the
enactment of S. 1843.
On, January 30, 2002 and March 1, 2002, the Committee on
Energy and Natural Resources requested legislative reports from
the Federal Energy Regulatory Commission and the Office of
Management and Budget setting forth Executive agency
recommendations on S. 1843. The report was received on March
19, 2002. The pertinent communications received by the
Committee from the Chairman of the Federal Energy Regulatory
Commission setting forth his views relating to this measure are
set forth below:
Federal Energy Regulatory Commission,
Washington, DC, March 19, 2002.
Hon. Jeff Bingaman,
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
Dear Mr. Chairman: Thank you for your letter of January 30,
2002, requesting comments on S. 1843, a bill to extend the
construction deadlines applicable to a hydroelectric project in
Alaska licensed by the Federal Energy Regulatory Commission
(FERC No. 11393). A report on the project is attached to this
Section 13 of the Federal Power Act requires that
construction of a licensed project be commenced within two
years of issuance of the license. Section 13 authorizes the
Commission to extend this deadline once, for a maximum
additional two years. If project construction has not commenced
by this deadline, the Commission is required to terminate the
license. Section 13 also authorizes the Commission to extend
the deadline for completion of construction when not
incompatible with the public interest.
As a general matter, enactment of bills authorizing or
requiring commencement-of-construction extensions for
individual projects delays the development of an important
energy resource and therefore has not been recommended. In
cases where project-specific extensions are authorized by the
Congress, it has been the position of prior Commission chairmen
that such extensions not go beyond ten years from the date the
project was licensed. If a licensee cannot meet a ten-year
deadline, then as a general rule the license should be
terminated, making the site once again available for such uses
as current circumstances may warrant based on up-to-date
information on economic and environmental considerations. I
have no reason to depart from this extension policy.
S. 1843 would permit the licensee for Project No. 11393 to
obtain construction delays of more than 12 years; how much more
depends on the date of completion of a transmission line not
under Commission jurisdiction. This means that project
construction could commence over 16 years after the license was
issued: the 4 years already allowed under Section 13, and the
12 years allowed by S. 1843. Accordingly, these bills are not
consistent with the ten-year extension policy.
Thank you for the opportunity to comment on S. 1843. If I
can be of further assistance in this or any other Commission
matter, please let me know.
Pat Wood III,
Attachment to Chairman Wood's Response to Chairman Bingaman's Letter of
January 30, 2002 Regarding S. 1843
S. 1843 would require the Commission, at the request of the
licensee for FERC Project No. 11393, to issue an order staying
the project license. Upon the request of the licensee, but not
later than 6 years after the date the Commission receives
written notice that construction of the Swan-Tyee transmission
line is completed, the Commission shall issue an order lifting
the stay and make the effective date of the license the date on
which the stay is lifted. Thereafter, at the request of the
licensee, and notwithstanding the maximum four-year time period
specified in Section 13 of the Federal Power Act, the
Commission shall extend the deadline for commencement of
project construction for not more than 3 consecutive 2-year
time periods. The total potential construction extensions,
above and beyond the 4 years permitted by Section 13 of the
Federal Power Act, would be over 12 years, which means
construction might not commence until over 16 years from the
date the license was issued.
PROJECT NO. 11393
On January 22, 1998, the Commission issued a license to the
City of Saxman, Alaska, to construct, operate, and maintain the
96-megawatt Mahoney Lake Hydroelectric Project No. 11393, to be
located on Upper Mahoney Lake and Upper Mahoney Creek near
Ketchikan in the Ketchikan Gateway Borough of southeast Alaska.
The original deadline for the commencement of project
construction, January 21, 2000, was extended by the Commission
to January 21, 2002. The Commission knows of no other interest
in the site.
Construction of Project No. 11393 entails the installation
of a tap into Upper Mahoney Lake, a 1,700-foot-long upper
tunnel, a valve house, a buried bypass pipe, a 1,370-foot-long
vertical shaft, an 8-foot-diameter, 3,350-foot-long lower
tunnel, a semi-underground powerhouse, a 200-foot-long tailrace
channel, 1.5 miles of buried, and 3.1 miles of overhead,
transmission line, a switchyard, and 2.6 miles of new access
CHANGES IN EXISTING LAW
In compliance with paragraph 12 of rule XXVI of the
Standing Rules of the Senate, the Committee notes that no
changes in existing law are made by the bill S. 1843, as