[Federal Register: August 14, 2006 (Volume 71, Number 156)]
[Rules and Regulations]
[Page 46383-46388]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr14au06-1]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
Prices of new books are listed in the first FEDERAL REGISTER issue of each
week.
========================================================================
[[Page 46383]]
DEPARTMENT OF ENERGY
Office of Energy Efficiency and Renewable Energy
10 CFR Part 451
RIN 1904-AB62
Renewable Energy Production Incentives
AGENCY: Office of Energy Efficiency and Renewable Energy, Department of
Energy.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: The Department of Energy (DOE) Office of Energy Efficiency and
Renewable Energy is publishing amendments to its regulations for the
Renewable Energy Production Incentives (REPI) program to incorporate
changes made by section 202 of the Energy Policy Act of 2005 (EPACT
2005). The REPI program provides for production incentive payments to
owners or operators of qualified renewable energy facilities, subject
to the availability of appropriations. The statutory changes in these
amendments to part 451 relate to allocation of available funds between
owners or operators of two categories of qualified facilities,
incorporation of additional ownership categories, extension of the
eligibility window and program termination date, and expansion of
applicable renewable energy technologies. In addition to the changes
specified by EPACT 2005, this final rule modifies the method for
accrued energy accounting. Other minor changes are made to update the
regulations.
DATES: This rule is effective on August 14, 2006.
FOR FURTHER INFORMATION CONTACT: Daniel Beckley, U.S. Department of
Energy, Office of Renewable Energy and Energy Efficiency, EE-2K, 1000
Independence Avenue, SW., Washington, DC 20585, (202) 586-7691.
SUPPLEMENTARY INFORMATION:
I. Background
II. Discussion of Comments
III. Effective Date
IV. Regulatory Review
V. Approval of the Office of the Secretary
I. Background
The Energy Policy Act of 1992, Public Law 102-486, established the
REPI program to encourage production of electric energy from facilities
owned by a State, a political subdivision of a State, or a non-profit
electric cooperative using certain renewable energy resources. Subject
to availability of appropriations, DOE was authorized to pay 1.5 cents,
adjusted annually for inflation, to facility owners or operators for
each kilowatt-hour of electric energy produced by qualified renewable
energy facilities. As specified in the statute as originally enacted,
the first energy production year was fiscal year 1994 and a ten-year
eligibility window was prescribed. Therefore, DOE did not accept
applications for the REPI program after September 30, 2003. Qualified
facility owners are eligible for payment for ten successive years
beginning with the first year for which an energy payment is made. As a
result, incentive payments were expected to continue through 2013. DOE
has continued to make incentive payments, based on available
appropriations, to those applicants whose ten successive years of
participation in the program have not expired.
Section 202 of EPACT 2005, Public Law 109-58, modifies the REPI
program by (a) extending the eligibility window, (b) extending the
termination date for the program, (c) increasing the number of
renewable energy technologies eligible under the program, (d)
broadening the category of qualified owners, and (e) altering the
procedure for determining payment distributions if insufficient funds
are appropriated to make full incentive payments for all approved
applications. On June 26, 2006, DOE proposed revisions to the REPI
program regulations at 10 CFR part 451 to implement the EPACT 2005
amendments and to revise provisions that had become outdated since DOE
initially implemented the program in 1995 (71 FR 36225). This final
rule amends the REPI program regulations as proposed with only minor
changes.
DOE included a discussion of each proposed amendment in the June 26
notice of proposed rulemaking (NOPR). The most extensive discussion
relates to implementation of the statutory 60:40 distribution between
the two categories of eligible renewable energy facilities and the
method DOE will use to incorporate accrued energy into pro rata
calculations when insufficient funds are appropriated to cover all
qualified kilowatt-hours. See 71 FR 36227.
II. Discussion of Comments
DOE received 6 comments in response to the NOPR, summarized as
follows. One commenter suggested modifications to the proposed
definition of ``ocean.'' Two utilities currently participating in the
REPI program objected to certain features of the proposed revisions to
the pro rata calculation method. Two national organizations
representing utility interests broadly endorsed the proposed revisions
to the program regulations. Lastly, a private party offered comments in
support of renewable energy projects, but unrelated to the specifics of
the proposed rule.
In regard to the definition of ``ocean,'' DOE proposed a definition
because the ocean was made an eligible renewable energy source by EPACT
2005. DOE proposed to define ``ocean'' to mean the parts of the
Atlantic Ocean (including the Gulf of Mexico) and the Pacific Ocean
that are contiguous to the United States coastline and from which
energy may be derived through application of tides, waves, currents,
thermal differences, or other means. The commenter noted that the term
``contiguous,'' while usually meaning adjacent or touching, also has
been used in certain legal descriptions to refer to specific ocean
areas and that DOE's use of the term in its definition could create
confusion. The commenter also questioned the use of the term ``parts''
as potentially adding further confusion and suggested substitution of
the term ``waters.'' DOE agrees with both of these comments and has
made modifications to the definition. Having made these changes, DOE
has made a corresponding change to the location specification in the
section titled ``What is a Qualified Renewable Energy Facility'' so
that it is consistent with the revised ocean definition. The effect of
this latter
[[Page 46384]]
change is to avoid restricting the location of a renewable energy
facility to the territorial sea (0-12 nautical miles) and to allow
placement in any part of the ocean over which the U.S. claims
jurisdiction.
In regard to methods of pro rata calculations, DOE proposed to
amend the provisions dealing with incentive payments when there are
insufficient funds to make payments for all qualifying energy. Under
both the original rule and today's amended rule, the total qualified
electrical energy consists of (1) the energy produced in the most
recent year and (2) the accrued energy (which is the qualified energy
produced in all preceding years for which payment was not made). To
conform to EPACT 2005, DOE proposed to allocate available funds into
two categories on a 60:40 basis (as specified at 42 U.S.C.
13317(a)(4)(A)) and to calculate potential payments initially based on
the prior year's energy production and, if funds are not exhausted,
secondarily based on accrued energy.
Two previously qualified utilities participating in the same wind
project disagreed with this modified approach. Both commenters stated
that (a) existing participants should be ``grandfathered,'' i.e., be
exempt from the new 60:40 funding allocation and be paid before new
entrants assigned to the 60:40 funding groups, and that (b) accrued
energy from the former Tier 1 group should continue to be assigned
status second only to prior year produced Tier 1 energy and therefore
have priority over the new 40 percent (or former Tier 2) group. One of
the commenters further asserted that DOE has no mandate to apply the
60:40 funding division ``retroactively'' to participants who entered
under the original rule and has done so on an arbitrary basis. DOE has
not made the changes recommended by these commenters. The EPACT 2005
amendments to 42 U.S.C. 13317 provide that when there is insufficient
funding to make full incentive payments to all qualified participants,
DOE must make payments to two groups of qualified facilities with a
60:40 division of funds. The two groups roughly correspond to the Tier
1 and Tier 2 categories of qualified facilities under the original
statute and regulations. EPACT 2005 does not include any provision that
allows DOE to continue the program under the original regulations--
under which funding of Tier 1 facilities takes precedence over funding
of Tier 2 facilities--for previously qualified renewable energy
facilities. Although 42 U.S.C. 13317(4)(B) permits the Secretary to
alter the 60:40 percentage requirements after submitting the reasons
for the alteration to Congress, this provision does not authorize
grandfathering of previously qualified facilities under the original
rule or the exemption of any group of participants from the 60:40
distribution. Thus, DOE may not ``grandfather'' a group of recipients
that would receive payment under the old rule before payment to the
newly required 60:40 participant groups as requested by the commenter.
DOE further rejects the argument that the 60:40 division of REPI funds
would apply retroactively under this rule. This final rule will apply
prospectively to incentive payments made on or after the effective date
set forth in this notice of final rulemaking.
The issue of accrued energy and its status in the payment priority
hierarchy (point (b) in the summary of commenters' points above) merits
further discussion. DOE recognizes that the effect of EPACT 2005 is to
shift payout funds from the former Tier 1 group to the former Tier 2
group. As previously explained, DOE's rule must implement the 60:40
distribution division. DOE also recognizes, as these commenters imply,
that the removal of accrued energy from equal status with energy
produced in the prior fiscal year has the effect of further reducing
the pro rata payment that might otherwise be received by former Tier 1
recipients. The statute (as originally enacted and as amended by EPACT
2005) contemplates an annual appropriation to support an annual payment
for annual energy production. Although not expressly required by
statute, DOE created an accrued energy account under its program
regulations because it recognized that unpaid energy could result from
insufficient appropriations, and it viewed payment for accrued energy
as permissible under the statute. DOE continues to provide for payments
for accrued energy under today's final rule. However, DOE believes that
making payment for accrued energy secondary to annual energy in the
determination of pro rata payments is most consistent with the policy
choice reflected in the statute as amended by EPACT 2005, and is fairer
to all eligible participants. Consequently, DOE has made no changes in
the final rule regarding accrued energy calculations.
III. Effective Date
The Administrative Procedure Act (APA) requires that agencies
publish a rule not less than 30 days before the rule will become
effective, unless an exception from this requirement applies (5 U.S.C.
553(d)(3)). Under the APA, agencies may bypass this 30-day delay for
``good cause.'' DOE is invoking the ``good cause'' exception in this
instance and making these regulations effective immediately upon
publication. The final rule published today updates but does not
substantially change the existing rules for REPI in 10 CFR part 451,
except as required by section 202 of EPACT 2005. The established REPI
procedures specify an application period of October 1-December 31 (the
first 3 months of the Federal fiscal year) for applicants to provide
data on REPI energy produced during the prior fiscal year and to
request payment for this energy. There are currently applicants
awaiting payment out of FY06 funds for energy produced in FY05.
However, payment has not yet been made because EPACT 2005 opened the
FY06 funding to new applicants. The new applicants are unable to apply
until the final rule is published. With a 30-day delay in
effectiveness, there would be insufficient time remaining in FY06 for
participants to apply for FY06 funds and for DOE to process those
applications. In addition, DOE published a NOPR on June 26, 2006, that
included notice of a possible August 31 deadline for applications for
FY05 payments. Both EPACT 2005 and the NOPR have given potential REPI
participants adequate notice to adjust their behavior. Moreover, DOE
foresees little, if any, harm done by bypassing the 30-day delay in
effectiveness, and only by making the rule effective upon publication
can DOE fulfill the statute's objective of encouraging the production
of renewable energy by providing incentive funding to the renewable
energy producers.
IV. Regulatory Review
A. Executive Order 12866
This rule has been determined to not be a ``significant regulatory
action'' under Executive Order 12866, ``Regulatory Planning and
Review,'' 58 FR 51735 (October 4, 1993). Accordingly, this action is
not subject to review under that Executive Order by the Office of
Information and Regulatory Affairs of the Office of Management and
Budget.
B. National Environmental Policy Act
DOE has determined that this rule is covered under the Categorical
Exclusion found in the Department's National Environmental Policy Act
regulations at paragraph A.6 of appendix A to subpart D, 10 CFR part
1021, which applies to rulemakings that are strictly procedural.
Accordingly, neither an environmental assessment nor an environmental
impact statement is required.
[[Page 46385]]
C. Regulatory Flexibility Act
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires
preparation of an initial regulatory flexibility analysis for any rule
that by law must be proposed for public comment, unless the agency
certifies that the rule, if promulgated, will not have a significant
economic impact on a substantial number of small entities. As required
by Executive Order 13272, ``Proper Consideration of Small Entities in
Agency Rulemaking,'' 67 FR 53461 (August 16, 2002), DOE published
procedures and policies on February 19, 2003, to ensure that the
potential impacts of its rules on small entities are properly
considered during the rulemaking process (68 FR 7990). DOE has made its
procedures and policies available on the Office of General Counsel's
Web site: http://www.gc.doe.gov.
DOE has reviewed this rule under the provisions of the Regulatory
Flexibility Act and the procedures and policies published on February
19, 2003. These amendments revise DOE's regulations for its program for
making production incentive payments to owners or operators of
qualified renewable energy facilities, subject to the availability of
appropriations. The regulations are procedural in nature and affect
only entities that choose to apply for incentive payments under the
program. The rule's procedures will not have a significant economic
impact on any class of entities. On the basis of the foregoing, DOE
certifies that the rule does not have a significant economic impact on
a substantial number of small entities. Accordingly, DOE has not
prepared a regulatory flexibility analysis for this rulemaking. DOE's
certification and supporting statement of factual basis has been
provided to the Chief Counsel for Advocacy of the Small Business
Administration pursuant to 5 U.S.C. 605(b).
D. Paperwork Reduction Act
This rule does not impose any new collection of information subject
to review and approval by the Office of Management and Budget (OMB)
under the Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq.
E. Unfunded Mandates Reform Act of 1995
The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) generally
requires Federal agencies to examine closely the impacts of regulatory
actions on State, local, and tribal governments. Subsection 101(5) of
title I of that law defines a Federal intergovernmental mandate to
include any regulation that would impose upon State, local, or tribal
governments an enforceable duty, except a condition of Federal
assistance or a duty arising from participating in a voluntary Federal
program. Title II of that law requires each Federal agency to assess
the effects of Federal regulatory actions on State, local, and tribal
governments, in the aggregate, or to the private sector, other than to
the extent such actions merely incorporate requirements specifically
set forth in a statute. Section 202 of that title requires a Federal
agency to perform a detailed assessment of the anticipated costs and
benefits of any rule that includes a Federal mandate which may result
in costs to State, local, or tribal governments, or to the private
sector, of $100 million or more. Section 204 of that title requires
each agency that proposes a rule containing a significant Federal
intergovernmental mandate to develop an effective process for obtaining
meaningful and timely input from elected officers of State, local, and
tribal governments.
This rule does not impose a Federal mandate on State, local or
tribal governments. The rule does not result in the expenditure by
State, local, and tribal governments in the aggregate, or by the
private sector, of $100 million or more in any one year. Accordingly,
no assessment or analysis is required under the Unfunded Mandates
Reform Act of 1995.
F. Treasury and General Government Appropriations Act, 1999
Section 654 of the Treasury and General Government Appropriations
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family
Policymaking Assessment for any proposed rule that may affect family
well being. The proposed rule would not have any impact on the autonomy
or integrity of the family as an institution. Accordingly, DOE has
concluded that it is not necessary to prepare a Family Policymaking
Assessment.
G. Executive Order 13132
Executive Order 13132, ``Federalism,'' 64 FR 43255 (August 4, 1999)
imposes certain requirements on agencies formulating and implementing
policies or regulations that preempt State law or that have federalism
implications. Agencies are required to examine the constitutional and
statutory authority supporting any action that would limit the
policymaking discretion of the States and carefully assess the
necessity for such actions. DOE has examined this rule and has
determined that it would not preempt State law and would not have a
substantial direct effect on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government. No further
action is required by Executive Order 13132.
H. Executive Order 12988
With respect to the review of existing regulations and the
promulgation of new regulations, section 3(a) of Executive Order 12988,
``Civil Justice Reform,'' 61 FR 4729 (February 7, 1996), imposes on
Executive agencies the general duty to adhere to the following
requirements: (1) Eliminate drafting errors and ambiguity; (2) write
regulations to minimize litigation; and (3) provide a clear legal
standard for affected conduct rather than a general standard and
promote simplification and burden reduction. With regard to the review
required by section 3(a), section 3(b) of Executive Order 12988
specifically requires that Executive agencies make every reasonable
effort to ensure that the regulation: (1) Clearly specifies the
preemptive effect, if any; (2) clearly specifies any effect on existing
Federal law or regulation; (3) provides a clear legal standard for
affected conduct, while promoting simplification and burden reduction;
(4) specifies the retroactive effect, if any; (5) adequately defines
key terms; and (6) addresses other important issues affecting clarity
and general draftsmanship under any guidelines issued by the Attorney
General. Section 3(c) of Executive Order 12988 requires Executive
agencies to review regulations in light of applicable standards in
section 3(a) and section 3(b) to determine whether they are met or it
is unreasonable to meet one or more of them. DOE has completed the
required review and determined that, to the extent permitted by law,
the rule meets the relevant standards of Executive Order 12988.
I. Treasury and General Government Appropriations Act, 2001
The Treasury and General Government Appropriations Act, 2001 (44
U.S.C. 3516 note) provides for agencies to review most disseminations
of information to the public under guidelines established by each
agency pursuant to general guidelines issued by OMB.
OMB's guidelines were published at 67 FR 8452 (February 22, 2002),
and DOE's guidelines were published at 67 FR 62446 (October 7, 2002).
DOE has reviewed this rule under the OMB and DOE guidelines and has
concluded that
[[Page 46386]]
it is consistent with applicable policies in those guidelines.
J. Executive Order 13211
Executive Order 13211, ``Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use,'' 66 FR 28355
(May 22, 2001), requires Federal agencies to prepare and submit to the
OMB, a Statement of Energy Effects for any proposed significant energy
action. A ``significant energy action'' is defined as any action by an
agency that promulgated or is expected to lead to promulgation of a
final rule, and that: (1) Is a significant regulatory action under
Executive Order 12866, or any successor order; and (2) is likely to
have a significant adverse effect on the supply, distribution, or use
of energy, or (3) is designated by the Administrator of the Office of
Information and Regulatory Affairs (OIRA), as a significant energy
action. For any proposed significant energy action, the agency must
give a detailed statement of any adverse effects on energy supply,
distribution, or use should the proposal be implemented, and of
reasonable alternatives to the action and their expected benefits on
energy supply, distribution, and use. Today's regulatory action would
not have a significant adverse effect on the supply, distribution, or
use of energy and is therefore not a significant energy action.
Accordingly, DOE has not prepared a Statement of Energy Effects.
K. Congressional Notification
As required by 5 U.S.C. 801, DOE will submit to Congress a report
regarding the issuance of today's final rule prior to the effective
date set forth at the outset of this rulemaking. The report will state
that it has been determined that the rule is not a ``major rule'' as
defined by 5 U.S.C. 801(2).
V. Approval of the Office of the Secretary
The Secretary of Energy has approved publication of today's final
rule.
List of Subjects in 10 CFR Part 451
Electric utilities, Energy, Power sources, Renewable energy.
Issued in Washington, DC, on August 8, 2006.
Alexander A. Karsner,
Assistant Secretary, Energy Efficiency and Renewable Energy.
0
For the reasons set forth in the preamble, part 451 of title 10,
chapter II of the Code of Federal Regulations, is amended as follows:
PART 451--RENEWABLE ENERGY PRODUCTION INCENTIVES
0
1. The authority citation for part 451 is revised to read as follows:
Authority: 42 U.S.C. 7101, et seq.; 42 U.S.C. 13317.
0
2. Section 451.1(a) is revised to read as follows:
Sec. 451.1 Purpose and scope.
(a) The provisions of this part cover the policies and procedures
applicable to the determinations by the Department of Energy (DOE) to
make incentive payments, under the authority of 42 U.S.C. 13317, for
electric energy generated and sold by a qualified renewable energy
facility owned by a State or political subdivision thereof; a not-for-
profit electric cooperative; a public utility described in section 115
of the Internal Revenue Code of 1986; an Indian tribal government or
subdivision thereof; or a Native corporation.
* * * * *
0
3. Section 451.2 is amended by:
0
a. Adding in alphabetical order definitions of ``Biomass,'' ``Date of
first use,'' ``Indian tribal government,'' ``Native corporation,''
``Not-for-profit electrical cooperative,'' and ``Ocean''.
0
b. Revising the definitions of ``Closed loop biomass,'' ``Deciding
Official,'' ``Renewable energy source'' and ``State.''
0
c. Removing the definition of ``Nonprofit electrical cooperative.''
The revisions and additions read as follows:
Sec. 451.2 Definitions.
* * * * *
Biomass means biologically generated energy sources such as heat
derived from combustion of plant matter, or from combustion of gases or
liquids derived from plant matter, animal wastes, or sewage, or from
combustion of gases derived from landfills, or hydrogen derived from
these same sources.
Closed-loop biomass means any organic material from a plant which
is planted exclusively for purposes of being used at a qualified
renewable energy facility to generate electricity.
Date of first use means, at the option of the facility owner, the
date of the first kilowatt-hour sale, the date of completion of
facility equipment testing, or the date when all approved permits
required for facility construction are received.
Deciding Official means the Manager of the Golden Field Office of
the Department of Energy (or any DOE official to whom the authority of
the Manager of the Golden Field Office may be redelegated by the
Secretary of Energy).
* * * * *
Indian tribal government means the governing body of an Indian
tribe as defined in section 4 of the Indian Self-Determination and
Education Assistance Act (25 U.S.C. 450b).
Native corporation has the meaning set forth in the Alaska Native
Claims Settlement Act (25 U.S.C. 1602).
* * * * *
Not-for-profit electrical cooperative means a cooperative
association that is legally obligated to operate on a not-for-profit
basis and is organized under the laws of any State for the purpose of
providing electric service to its members.
Ocean means the waters of the Atlantic Ocean (including the Gulf of
Mexico) and the Pacific Ocean within the jurisdiction of the United
States from which energy may be derived through application of tides,
waves, currents, thermal differences, or other means.
* * * * *
Renewable energy source means solar heat, solar light, wind, ocean,
geothermal heat, and biomass, except for--
(1) Heat from the burning of municipal solid waste; or
(2) Heat from a dry steam geothermal reservoir which--
(i) Has no mobile liquid in its natural state;
(ii) Is a fluid composed of at least 95 percent water vapor; and
(iii) Has an enthalpy for the total produced fluid greater than or
equal to 2.791 megajoules per kilogram (1200 British thermal units per
pound).
State means the District of Columbia, Puerto Rico, and any of the
States, Commonwealths, territories, and possessions of the United
States.
0
4. Section 451.4 is amended by:
0
a. Revising paragraphs (a)(2) and (a)(3) and adding new paragraphs
(a)(4) and (a)(5).
0
b. Revising paragraph (e).
0
c. Adding the word ``ocean'' after the word ``wind'' in paragraphs
(f)(1) and (f)(2).
0
d. Adding the words ``or in U.S. jurisdictional waters'' after the word
``State'' in paragraph (g).
The revisions and additions read as follows:
Sec. 451.4 What is a qualified renewable energy facility.
* * * * *
(a) * * *
(2) A public utility described in section 115 of the Internal
Revenue Code of 1986;
[[Page 46387]]
(3) A not-for-profit electrical cooperative;
(4) An Indian tribal government or subdivision thereof; or
(5) A Native corporation.
* * * * *
(e) Time of first use. The date of the first use of a newly
constructed renewable energy facility, or a facility covered by
paragraph (f) of this section, must occur during the inclusive period
beginning October 1, 1993, and ending on September 30, 2016. For
facilities whose date of first use occurred in the period October 1,
2003, through September 30, 2004, the time of first use shall be deemed
to be October 1, 2004.
* * * * *
0
5. Section 451.5 is amended by revising paragraphs (b)(1) and (b)(2) to
read as follows:
Sec. 451.5 Where and when to apply.
* * * * *
(b) * * *
(1) An application for an incentive payment for electric energy
generated and sold in a fiscal year must be filed during the first
quarter (October 1 through December 31) of the next fiscal year, except
as provided in paragraph (b)(2) of this section.
(2) For facilities whose date of first use occurred in the period
October 1, 2003, through September 30, 2005, applications for incentive
payments for electric energy generated and sold in fiscal year 2005
must be filed by August 31, 2006.
* * * * *
Sec. 451.6 [Amended]
0
6. Section 451.6 is amended by adding the word ``consecutive'' before
the words ``fiscal years'' in the first sentence, and in the last
sentence, by removing the date ``2013'' and adding in its place the
date ``2026''.
0
7. Section 451.8 is amended by:
0
a. Removing the comma after the word ``owner,'' where it is first used
in paragraph (a).
0
b. Removing paragraph (h) and redesignating (i) as paragraph (h).
0
c. Revising redesignated paragraph (h).
0
d. Adding a new paragraph (i).
0
e. Revising paragraph (j).
0
f. Removing the word ``nonprofit'' and adding in its place the term
``not-for-profit'' in paragraph (m).
The revisions and additions read as follows:
Sec. 451.8 Application content requirements.
* * * * *
(h) The total amount of electric energy for which payment is
requested, including the net electric energy generated in the prior
fiscal year, as determined according to paragraph (f) or (g) of this
section;
(i) Copies of permit authorizations if the date of first use is
based on permit approvals and this is the initial application;
(j) Instructions for payment by electronic funds transfer;
* * * * *
0
8. Section 451.9 is amended by revising paragraphs (c), (d), and (e) to
read as follows:
Sec. 451.9 Procedures for processing applications.
* * * * *
(c) DOE determinations. The Assistant Secretary for Energy
Efficiency and Renewable Energy shall determine the extent to which
appropriated funds are available to be obligated under this program for
each fiscal year. Upon evaluating each application and any other
relevant information, DOE shall further determine:
(1) Eligibility of the applicant for receipt of an incentive
payment, based on the criteria for eligibility specified in this part;
(2) The number of kilowatt-hours to be used in calculating a
potential incentive payment, based on the net electric energy generated
from a qualified renewable energy source at the qualified renewable
energy facility and sold during the prior fiscal year;
(3) The number of kilowatt-hours to be used in calculating a
potential additional incentive payment, based on the total quantity of
accrued energy generated during prior fiscal years;
(4) The amounts represented by 60 percent of available funds and by
40 percent of available funds; and
(5) Whether justification exists for altering the 60:40 payment
ratio specified in paragraph (e) of this section. If DOE intends to
modify the 60:40 ratio, the Department shall notify Congress, setting
forth reasons for such change.
(d) Calculating payments. Subject to the provisions of paragraph
(e) of this section, potential incentive payments under this part shall
be determined by multiplying the number of kilowatt-hours determined
under Sec. 451.9(c)(2) by 1.5 cents per kilowatt-hour, and adjusting
that product for inflation for each fiscal year beginning after
calendar year 1993 in the same manner as provided in section
29(d)(2)(B) of the Internal Revenue Code of 1986, except that in
applying such provisions calendar year 1993 shall be substituted for
calendar year 1979. Using the same procedure, a potential additional
payment shall be determined for the number of kilowatt-hours determined
under paragraph (c)(3) of this section. If the sum of these calculated
payments does not exceed the funds determined to be available by the
Assistant Secretary for Energy Efficiency and Renewable Energy under
Sec. 451.9(c), DOE shall make payments to all qualified applicants.
(e) Insufficient funds. If funds are not sufficient to make full
incentive payments to all qualified applicants, DOE shall--
(1) Calculate potential incentive payments, if necessary on a pro
rata basis, not to exceed 60 percent of available funds to owners or
operators of qualified renewable energy facilities using solar, wind,
ocean, geothermal, and closed-loop biomass technologies based on prior
year energy generation;
(2) Calculate potential incentive payments, if necessary on a pro
rata basis, not to exceed 40 percent of available funds to owners or
operators of all other qualified renewable energy facilities based on
prior year energy generation;
(3) If the amounts calculated in paragraph (e)(1) and (2) of this
section result in one owner group with insufficient funds and one with
excess funds, allocate excess funds to the owner group with
insufficient funds and calculate additional incentive payments, on a
pro rata basis if necessary, to such owners or operators based on prior
year energy generation.
(4) If potential payments calculated in paragraphs (e)(1), (2), and
(3) of this section do not exceed available funding, allocate 60% of
remaining funds to paragraph (e)(1) recipients and 40% to paragraph
(e)(2) recipients and calculate additional incentive payments, if
necessary on a pro rata basis, to owners or operators based on accrued
energy;
(5) If the amounts calculated in paragraph (e)(4) of this section
result in one owner group with insufficient funds and one with excess
funds, allocate excess funds to the owner group with insufficient funds
and calculate additional incentive payments, on a pro rata basis if
necessary, to such owners or operators based on accrued energy.
(6) Notify Congress if potential payments resulting from paragraphs
(e)(3) or (5) of this section above will result in alteration of the
60:40 payment ratio;
(7) Make incentive payments based on the sum of the amounts
determined in paragraphs (e)(1) through (5) of this section for each
applicant;
(8) Treat the number of kilowatt-hours for which an incentive
payment is not made as a result of insufficient funds as
[[Page 46388]]
accrued energy for which future incentive payment may be made; and
(9) Maintain a record of each applicant's accrued energy.
* * * * *
[FR Doc. 06-6925 Filed 8-10-06; 1:20 pm]
BILLING CODE 6450-01-P