Energy Department Seeks Additional Feedback on Draft Guidance for the Hydroelectric Production Incentive Program

October 20, 2014

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The Department of Energy (DOE) is currently inviting comments from the general public on revised guidance relating to the implementation of Section 242 of the Energy Policy Act of 2005, the “Hydroelectric Production Incentive Program.” Public comments on the initial Section 242 Draft Guidance were accepted from July 1 – 16, 2014 and have been incorporated into new Draft Guidance that is now being released for additional comments. In order to ensure that DOE has accurately and thoroughly addressed the previously submitted comments, the revised Draft Guidance is available for public comment for 15 business days.

In the Fiscal Year 2014 Omnibus Appropriations Bill, Congress directed the Department of Energy to provide $3.6 million “for the purposes of Section 242 of the Energy Policy Act of 2005.” Although this legislation was originally passed in 2005, no funding was appropriated at that time. Section 242 directs the Department of Energy to make incentive payments to the owner or operator of a qualified hydroelectric facility based on the number of kilowatt hours of hydroelectric energy generated by the facility during the incentive period. Any qualified owner or operator of a hydroelectric facility who added hydropower to non-powered dams or conduits, or added a new generator to an existing powered damn or conduit, between 2005 and 2015, but where the original dam/conduit was built prior to 2005, is eligible to apply for the Section 242 Incentive Program. Entities that added a new generator to a previously powered dam or conduit are only eligible to apply for the 242 Incentive Program for the electricity produced by the newly installed generator; electricity produced from previously installed generators has been deemed ineligible for the 242 Incentive Program.

DOE has identified the former Renewable Energy Production Incentive program, which was active from 1992 until the mid-2000s, as being the guiding framework for the Hydroelectric Production Incentive Program. Because the Hydroelectric Production Incentive Program has only been appropriated for one year with a limited budget, DOE will only be accepting applications for generation produced in calendar year 2013. If more than $3.6M worth of payments to eligible entities qualifies, DOE will calculate an equally distributed payment system based on power production. Available for download below is the Revised Draft Guidance for applications and the distribution of payments, as well as the summary of comments and DOE responses from the July, 2014 Draft Guidance comment period.

The open comment period begins on October 20, 2014 and ends on November 4, 2014.

Editor's note 12/16/2015: The most recent guidance for the Hydroelectric Production Incentive Program can be found here.

Please address comments to Steve Lindenberg at hydroincentive@ee.doe.gov.

Revised Draft Guidance for Section 242 of the Energy Policy Act of 2005

Federal Register Notice  

Comments and DOE responses to comments from the previous Section 242 Draft Guidance released on July 2, 2014