[Code of Federal Regulations]
[Title 18, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 18CFR4.38]

[Page 92-99]
 
           TITLE 18--CONSERVATION OF POWER AND WATER RESOURCES
 
  CHAPTER I--FEDERAL ENERGY REGULATORY COMMISSION, DEPARTMENT OF ENERGY
 
PART 4_LICENSES, PERMITS, EXEMPTIONS, AND DETERMINATION OF PROJECT 
COSTS--Table of Contents
 
  Subpart D_Application for Preliminary Permit, License or Exemption: 
                           General Provisions
 
Sec. 4.38  Consultation requirements.

    (a) Requirement to consult. (1) Before it files any application for 
an original license or an exemption from licensing that is described in 
paragraph (a)(4) of this section, a potential applicant must consult 
with the relevant Federal,

[[Page 93]]

State, and interstate resource agencies, including the National Marine 
Fisheries Service, the United States Fish and Wildlife Service, the 
National Park Service, the United States Environmental Protection 
Agency, the Federal agency administering any United States lands or 
facilities utilized or occupied by the project, the appropriate State 
fish and wildlife agencies, the appropriate State water resource 
management agencies, the certifying agency under section 401(a)(1) of 
the Federal Water Pollution Control Act (Clean Water Act), 33 U.S.C. 
Sec. 1341(c)(1), and any Indian tribe that may be affected by the 
proposed project.
    (2) Each requirement in this section to contact or consult with 
resource agencies or Indian tribes shall be construed to require as well 
that the potential applicant contact or consult with members of the 
public.
    (3) If a potential applicant for an original license commences first 
stage pre-filing consultation on or after July 23, 2005 it shall file a 
notification of intent to file a license application pursuant to Sec. 
5.5 and a pre-application document pursuant to the provisions of Sec. 
5.6.
    (4) The Director of the Office of Energy Projects will, upon 
request, provide a list of known appropriate Federal, state, and 
interstate resource agencies, Indian tribes, and local, regional, or 
national non-governmental organizations likely to be interested in any 
license application proceeding.
    (5) An applicant for an exemption from licensing or an applicant for 
a license seeking benefits under section 210 of the Public Utility 
Regulatory Policies Act, as amended, for a project that would be located 
at a new dam or diversion must, in addition to meeting the requirements 
of this section, comply with the consultation requirements in Sec. 
4.301.
    (6) The pre-filing consultation requirements of this section apply 
only to an application for:
    (i) Original license;
    (ii) Exemption;
    (iii) Amendment to an application for original license or exemption 
that materially amends the proposed plans of development as defined in 
Sec. 4.35(f)(1);
    (iv) Amendment to an existing license that would increase the 
capacity of the project as defined in Sec. 4.201(b); or
    (v) Amendment to an existing license that would not increase the 
capacity of the project as defined in Sec. 4.201(b), but that would 
involve:
    (A) The construction of a new dam or diversion in a location where 
there is no existing dam or diversion;
    (B) Any repair, modification, or reconstruction of an existing dam 
that would result in a significant change in the normal maximum surface 
area or elevation of an existing impoundment; or
    (C) The addition of new water power turbines other than to replace 
existing turbines.
    (7) Before it files a non-capacity related amendment as defined in 
Sec. 4.201(c), an applicant must consult with the resource agencies and 
Indian tribes listed in paragraph (a)(1) of this section to the extent 
that the proposed amendment would affect the interests of the agencies 
or tribes. When consultation is necessary, the applicant must, at a 
minimum, provide the resource agencies and Indian tribes with copies of 
the draft application and allow them at least 60 days to comment on the 
proposed amendment. The amendment as filed with the Commission must 
summarize the consultation with the resource agencies and Indian tribes 
on the proposed amendment, propose reasonable protection, mitigation, or 
enhancement measures to respond to impacts identified as being caused by 
the proposed amendment, and respond to any objections, recommendations, 
or conditions submitted by the agencies or Indian tribes. Copies of all 
written correspondence between the applicant, the agencies, and the 
tribes must be attached to the application.
    (8) This section does not apply to any application for a new 
license, a nonpower license, a subsequent license, or surrender of a 
license subject to sections 14 and 15 of the Federal Power Act.
    (9) If a potential applicant has any doubt as to whether a 
particular application or amendment would be subject to the pre-filing 
consultation requirements of this section or if a waiver of

[[Page 94]]

the pre-filing requirements would be appropriate, the applicant may file 
a written request for clarification or waiver with the Director, Office 
of Energy Projects.
    (b) First stage of consultation. (1) A potential applicant for an 
original license that commences pre-filing consultation on or after July 
23, 2005 must, at the time it files its notification of intent to seek a 
license pursuant to Sec. 5.5 of this chapter and a pre-application 
document pursuant to Sec. 5.6 of this chapter and, at the same time, 
provide a copy of the pre-application document to the entities specified 
in Sec. 5.6(a) of this chapter.
    (2) A potential applicant for an original license that commences 
pre-filing consultation under this part prior to July 23, 2005 or for an 
exemption must promptly contact each of the appropriate resource 
agencies, affected Indian tribes, and members of the public likely to be 
interested in the proceeding; provide them with a description of the 
proposed project and supporting information; and confer with them on 
project design, the impact of the proposed project (including a 
description of any existing facilities, their operation, and any 
proposed changes), reasonable hydropower alternatives, and what studies 
the applicant should conduct. The potential applicant must provide to 
the resource agencies, Indian tribes and the Commission the following 
information:
    (i) Detailed maps showing project boundaries, if any, proper land 
descriptions of the entire project area by township, range, and section, 
as well as by state, county, river, river mile, and closest town, and 
also showing the specific location of all proposed project facilities, 
including roads, transmission lines, and any other appurtenant 
facilities;
    (ii) A general engineering design of the proposed project, with a 
description of any proposed diversion of a stream through a canal or 
penstock;
    (iii) A summary of the proposed operational mode of the project;
    (iv) Identification of the environment to be affected, the 
significant resources present, and the applicant's proposed 
environmental protection, mitigation, and enhancement plans, to the 
extent known at that time;
    (v) Streamflow and water regime information, including drainage 
area, natural flow periodicity, monthly flow rates and durations, mean 
flow figures illustrating the mean daily streamflow curve for each month 
of the year at the point of diversion or impoundment, with location of 
the stream gauging station, the method used to generate the streamflow 
data provided, and copies of all records used to derive the flow data 
used in the applicant's engineering calculations;
    (vi) (A) A statement (with a copy to the Commission) of whether or 
not the applicant will seek benefits under section 210 of PURPA by 
satisfying the requirements for qualifying hydroelectric small power 
production facilities in Sec. 292.203 of this chapter;
    (B) If benefits under section 210 of PURPA are sought, a statement 
on whether or not the applicant believes diversion (as that term is 
defined in Sec. 292.202(p) of this chapter) and a request for the 
agencies' view on that belief, if any;
    (vii) Detailed descriptions of any proposed studies and the proposed 
methodologies to be employed; and
    (viii) Any statement required by Sec. 4.301(a) of this part.
    (3) (i) A potential exemption applicant and a potential applicant 
for an original license that commences pre-filing consultation;
    (A) On or after July 23, 2005 pursuant to part 5 of this chapter and 
receives approval from the Commission to use the license application 
procedures of part 4 of this chapter; or
    (B) Elects to commence pre-filing consultation under part 4 of this 
chapter prior to July 23, 2005; must:
    (1) Hold a joint meeting at a convenient place and time, including 
an opportunity for a site visit, with all pertinent agencies, Indian 
tribes, and members of the public to explain the applicant's proposal 
and its potential environmental impact, to review the information 
provided, and to discuss the data to be obtained and studies to be 
conducted by the potential applicant as part of the consultation 
process;

[[Page 95]]

    (2) Consult with the resource agencies, Indian tribes and members of 
the public on the scheduling and agenda of the joint meeting; and
    (3) No later than 15 days in advance of the joint meeting, provide 
the Commission with written notice of the time and place of the meeting 
and a written agenda of the issues to be discussed at the meeting.
    (ii) The joint meeting must be held no earlier than 30 days, but no 
later than 60 days, from, as applicable;
    (A) The date of the Commission's approval of the potential 
applicant's request to use the license application procedures of this 
part pursuant to the provisions of part 5 of this chapter; or
    (B) The date of the potential applicant's letter transmitting the 
information required by paragraph (b)(2) of this section, in the case of 
a potential exemption applicant or a potential license applicant that 
commences pre-filing consultation under this part prior to July 23, 
2005.
    (4) Members of the public must be informed of and invited to attend 
the joint meeting held pursuant to paragraph (b)(3) of this section by 
means of the public notice provision published in accordance with 
paragraph (g) of this section. Members of the public attending the 
meeting are entitled to participate in the meeting and to express their 
views regarding resource issues that should be addressed in any 
application for license or exemption that may be filed by the potential 
applicant. Attendance of the public at any site visit held pursuant to 
paragraph (b)(3) of this section will be at the discretion of the 
potential applicant. The potential applicant must make either audio 
recordings or written transcripts of the joint meeting, and must 
promptly provide copies of these recordings or transcripts to the 
Commission and, upon request, to any resource agency, Indian tribe, or 
member of the public.
    (5) Not later than 60 days after the joint meeting held under 
paragraph (b)(3) of this Section (unless extended within this time 
period by a resource agency, Indian tribe, or members of the public for 
an additional 60 days by sending written notice to the applicant and the 
Director of the Office of Energy Projects within the first 60 day 
period, with an explanation of the basis for the extension), each 
interested resource agency and Indian tribe must provide a potential 
applicant with written comments:
    (i) Identifying its determination of necessary studies to be 
performed or the information to be provided by the potential applicant;
    (ii) Identifying the basis for its determination;
    (iii) Discussing its understanding of the resource issues and its 
goals and objectives for these resources;
    (iv) Explaining why each study methodology recommended by it is more 
appropriate than any other available methodology alternatives, including 
those identified by the potential applicant pursuant to paragraph 
(b)(2)(vii) of this section;
    (v) Documenting that the use of each study methodology recommended 
by it is a generally accepted practice; and
    (vi) Explaining how the studies and information requested will be 
useful to the agency, Indian tribe, or member of the public in 
furthering its resource goals and objectives that are affected by the 
proposed project.
    (6)(i) If a potential applicant and a resource agency or Indian 
tribe disagree as to any matter arising during the first stage of 
consultation or as to the need to conduct a study or gather information 
referenced in paragraph (c)(2) of this section, the potential applicant 
or resource agency or Indian tribe may refer the dispute in writing to 
the Director of the Office of Energy Projects (Director) for resolution.
    (ii) At the same time as the request for dispute resolution is 
submitted to the Director, the entity referring the dispute must serve a 
copy of its written request for resolution on the disagreeing party and 
any affected resource agency or Indian tribe, which may submit to the 
Director a written response to the referral within 15 days of the 
referral's submittal to the Director.
    (iii) Written referrals to the Director and written responses 
thereto pursuant to paragraphs (b)(6)(i) or (b)(6)(ii) of this section 
must be filed with the Commission in accordance with the Commission's 
Rules of Practice and Procedure, and must indicate that they

[[Page 96]]

are for the attention of the Director pursuant to Sec. 4.38(b)(6).
    (iv) The Director will resolve the disputes by letter provided to 
the potential applicant and all affected resource agencies and Indian 
tribes.
    (v) If a potential applicant does not refer a dispute regarding a 
request for a potential applicant to obtain information or conduct 
studies (other than a dispute regarding the information specified in 
paragraph (b)(2) of this section), or a study to the Director under 
paragraph (b)(6) of this section, or if a potential applicant disagrees 
with the Director's resolution of a dispute regarding a request for 
information (other than a dispute regarding the information specified in 
paragraph (b)(2) of this section) or a study, and if the potential 
applicant does not provide the requested information or conduct the 
requested study, the potential applicant must fully explain the basis 
for its disagreement in its application.
    (vi) Filing and acceptance of an application will not be delayed, 
and an application will not be considered deficient or patently 
deficient pursuant to Sec. 4.32(e)(1) or (e)(2) of this part, merely 
because the application does not include a particular study or 
particular information if the Director had previously found, under 
paragraph (b)(6)(iv) of this section, that each study or information is 
unreasonable or unnecessary for an informed decision by the Commission 
on the merits of the application or use of the study methodology 
requested is not a generally accepted practice.
    (7) The first stage of consultation ends when all participating 
agencies and Indian tribes provide the written comments required under 
paragraph (b)(5) of this section or 60 days after the joint meeting held 
under paragraph (b)(3) of this section, whichever occurs first, unless a 
resource agency or Indian tribe timely notifies the applicant and the 
Director of Energy Projects of its need for more time to provide written 
comments under paragraph (b)(5) of this section, in which case the first 
stage of consultation ends when all participating agencies and Indian 
tribes provide the written comments required under paragraph (b)(5) of 
this section or 120 days after the joint meeting held under paragraph 
(b)(5) of this section, whichever occurs first.
    (c) Second stage of consultation. (1) Unless determined to be 
unnecessary by the Director pursuant to paragraph (b)(6) of this 
section, a potential applicant must diligently conduct all reasonable 
studies and obtain all reasonable information requested by resource 
agencies and Indian tribes under paragraph (b) of this section that are 
necessary for the Commission to make an informed decision regarding the 
merits of the application. These studies must be completed and the 
information obtained:
    (i) Prior to filing the application, if the results:
    (A) Would influence the financial (e.g., instream flow study) or 
technical feasibility of the project (e.g., study of potential mass soil 
movement); or
    (B) Are needed to determine the design or location of project 
features, reasonable alternatives to the project, the impact of the 
project on important natural or cultural resources (e.g., resource 
surveys), or suitable mitigation or enhancement measures, or to minimize 
impact on significant resources (e.g., wild and scenic river, anadromous 
fish, endangered species, caribou migration routes);
    (ii) After filing the application but before issuance of a license 
or exemption, if the applicant otherwise complied with the provisions of 
paragraph (b)(2) of this section and the study or information gathering 
would take longer to conduct and evaluate than the time between the 
conclusion of the first stage of consultation and the expiration of the 
applicant's preliminary permit or the application filing deadline set by 
the Commission;
    (iii) After a new license or exemption is issued, if the studies can 
be conducted or the information obtained only after construction or 
operation of proposed facilities, would determine the success of 
protection, mitigation, or enhancement measures (e.g., post-construction 
monitoring studies), or would be used to refine project operation or 
modify project facilities.
    (2) If, after the end of the first stage of consultation as defined 
in paragraph (b)(7) of this section, a resource agency

[[Page 97]]

or Indian tribe requests that the potential applicant conduct a study or 
gather information not previously identified and specifies the basis and 
reasoning for its request, under paragraphs (b)(5) (i)-(vi) of this 
section, the potential applicant must promptly initiate the study or 
gather the information, unless the study or information is unreasonable 
or unnecessary for an informed decision by the Commission on the merits 
of the application or use of the methodology requested by a resource 
agency or Indian tribe for conducting the study is not a generally 
accepted practice. The applicant may refer any such request to the 
Director of the Office of Energy Projects for dispute resolution under 
the procedures set forth in paragraph (b)(6) of this section and need 
not conduct prior to filing any study determined by the Director to be 
unreasonable or unnecessary or to employ a methodology that is not 
generally accepted.
    (3)(i) The results of studies and information-gathering referenced 
in paragraphs (c)(1)(ii) and (c)(2) of this section will be treated as 
additional information; and
    (ii) Filing and acceptance of an application will not be delayed and 
an application will not be considered deficient or patently deficient 
pursuant to Sec. 4.32 (e)(1) or (e)(2) merely because the study or 
information gathering is not complete before the application is filed.
    (4) A potential applicant must provide each resource agency and 
Indian tribe with:
    (i) A copy of its draft application that:
    (A) Indicates the type of application the potential applicant 
expects to file with the Commission; and
    (B) Responds to any comments and recommendations made by any 
resource agency and Indian tribe either during the first stage of 
consultation or under paragraph (c)(2) of this section;
    (ii) The results of all studies and information-gathering either 
requested by that resource agency or Indian tribe in the first stage of 
consultation (or under paragraph (c)(2) of this section if available) or 
which pertain to resources of interest to that resource agency or Indian 
tribe and which were identified by the potential applicant pursuant to 
paragraph (b)(2)(vii) of this section, including a discussion of the 
results and any proposed protection, mitigation, or enhancement 
measures; and
    (iii) A written request for review and comment.
    (5) A resource agency or Indian tribe will have 90 days from the 
date of the potential applicant's letter transmitting the paragraph 
(c)(4) information to it to provide written comments on the information 
submitted by a potential applicant under paragraph (c)(4) of this 
section.
    (6) If the written comments provided under paragraph (c)(5) of this 
section indicate that a resource agency or Indian tribe has a 
substantive disagreement with a potential applicant's conclusions 
regarding resource impacts or its proposed protection, mitigation, or 
enhancement measures, the potential applicant will:
    (i) Hold a joint meeting with the disagreeing resource agency or 
Indian tribe and other agencies with similar or related areas of 
interest, expertise, or responsibility not later than 60 days from the 
date of the written comments of the disagreeing agency or Indian tribe 
to discuss and to attempt to reach agreement on its plan for 
environmental protection, mitigation, or enhancement measures;
    (ii) Consult with the disagreeing agency or Indian tribe and other 
agencies with similar or related areas of interest, expertise, or 
responsibility on the scheduling of the joint meeting; and
    (iii) At least 15 days in advance of the meeting, provide the 
Commission with written notice of the time and place of the meeting and 
a written agenda of the issues to be discussed at the meeting.
    (7) The potential applicant and any disagreeing resource agency or 
Indian tribe may conclude a joint meeting with a document embodying any 
agreement among them regarding environmental protection, mitigation, or 
enhancement measures and any issues that are unresolved.

[[Page 98]]

    (8) The potential applicant must describe all disagreements with a 
resource agency or Indian tribe on technical or environmental 
protection, mitigation, or enhancement measures in its application, 
including an explanation of the basis for the applicant's disagreement 
with the resource agency or Indian tribe, and must include in its 
application any document developed pursuant to paragraph (c)(7) of this 
section.
    (9) A potential applicant may file an application with the 
Commission if:
    (i) It has complied with paragraph (c)(4) of this section and no 
resource agency or Indian tribe has responded with substantive 
disagreements by the deadline specified in paragraph (c)(5) of this 
section; or
    (ii) It has complied with paragraph (c)(6) of this section and a 
resource agency or Indian tribe has responded with substantive 
disagreements.
    (10) The second stage of consultation ends:
    (i) Ninety days after the submittal of information pursuant to 
paragraph (c)(4) of this section in cases where no resource agency or 
Indian tribe has responded with substantive disagreements; or
    (ii) At the conclusion of the last joint meeting held pursuant to 
paragraph (c)(6) of this section in cases where a resource agency or 
Indian tribe has responded with substantive disagreements.
    (d) Third stage of consultation. (1) The third stage of consultation 
is initiated by the filing of an application for a license or exemption, 
accompanied by a transmittal letter certifying that at the same time 
copies of the application are being mailed to the resource agencies, 
Indian tribes, other government offices, and consulted members of the 
public specified in paragraph (d)(2) of this section.
    (2) As soon as an applicant files such application documents with 
the Commission, or promptly after receipt in the case of documents 
described in paragraph (d)(2)(iii) of this section, as the Commission 
may direct the applicant must serve on every resource agency, Indian 
tribes, and member of the public consulted, and on other government 
offices copies of:
    (i) Its application for a license or an exemption from licensing;
    (ii) Any deficiency correction, revision, supplement, response to 
additional information request, or amendment to the application; and
    (iii) Any written correspondence from the Commission requesting the 
correction of deficiencies or the submittal of additional information.
    (e) Waiver of compliance with consultation requirements. (1) If a 
resource agency or Indian tribe waives in writing compliance with any 
requirement of this section, a potential applicant does not have to 
comply with that requirement as to that agency or tribe.
    (2) If a resource agency or Indian tribe fails to timely comply with 
a provision regarding a requirement of this section, a potential 
applicant may proceed to the next sequential requirement of this section 
without waiting for the resource agency or Indian tribe to comply.
    (3) The failure of a resource agency or Indian tribe to timely 
comply with a provision regarding a requirement of this section does not 
preclude its participation in subsequent stages of the consultation 
process.
    (4) Following October 23, 2003, a potential license applicant 
engaged in pre-filing consultation under part 4 may during first stage 
consultation request to incorporate into pre-filing consultation any 
element of the integrated license application process provided for in 
part 5 of this chapter. Any such request must be accompanied by a:
    (i) Specific description of how the element of the part 5 license 
application would fit into the pre-filing consultation process under 
this part; and
    (ii) Demonstration that the potential license applicant has made 
every reasonable effort to contact all resource agencies, Indian tribes, 
non-governmental organizations, and others affected by the applicant's 
proposal, and that a consensus exists in favor of incorporating the 
specific element of the part 5 process into the pre-filing consultation 
under this part.

[[Page 99]]

    (f) Application requirements documenting consultation and any 
disagreements with resource agencies. An applicant must show in Exhibit 
E of its application that it has met the requirements of paragraphs (b) 
through (d) and paragraphs (g) and (h) of this section, and must include 
a summary of the consultation process and:
    (1) Any resource agency's or Indian tribe's letters containing 
comments, recommendations, and proposed terms and conditions;
    (2) Any letters from the public containing comments and 
recommendations;
    (3) Notice of any remaining disagreement with a resource agency or 
Indian tribe on:
    (i) The need for a study or the manner in which a study should be 
conducted and the applicant's reasons for disagreement, and
    (ii) Information on any environmental protection, mitigation, or 
enhancement measure, including the basis for the applicant's 
disagreement with the resource agency or Indian tribe;
    (4) Evidence of any waivers under paragraph (e) of this section;
    (5) Evidence of all attempts to consult with a resource agency or 
Indian tribe, copies of related documents showing the attempts, and 
documents showing the conclusion of the second stage of consultation;
    (6) An explanation of how and why the project would, would not, or 
should not, comply with any relevant comprehensive plan as defined in 
Sec. 2.l9 of this chapter and a description of any relevant resource 
agency or Indian tribe determination regarding the consistency of the 
project with any such comprehensive plan;
    (7) A description of how the applicant's proposal addresses the 
significant resource issues raised at the joint meeting held pursuant to 
paragraph (b)(3) of this section; and
    (8) A list containing the name and address of every federal, state, 
and interstate resource agency and Indian tribe with which the applicant 
consulted pursuant to paragraph (a)(1) of this section.
    (g) Public participation. (1) At least 14 days in advance of the 
joint meeting held pursuant to paragraph (b)(3) of this section, the 
potential applicant must publish notice, at least once, of the purpose, 
location, and timing of the joint meeting, in a daily or weekly 
newspaper published in each county in which the proposed project or any 
part thereof is situated. The notice shall include a summary of the 
major issues to be discussed at the joint meeting.
    (2)(i) A potential applicant must make available to the public for 
inspection and reproduction the information specified in paragraph 
(b)(2) of this section from the date on which the notice required by 
paragraph (g)(1) of this section is first published until a final order 
is issued on any license application.
    (ii) The provisions of Sec. 4.32(b) will govern the form and manner 
in which the information is to be made available for public inspection 
and reproduction.
    (iii) A potential applicant must make available to the public for 
inspection at the joint meeting required by paragraph (b)(3) of this 
section at least two copies of the information specified in paragraph 
(b)(2) of this section.
    (h) Critical Energy Infrastructure Information. If this section 
requires an applicant to reveal Critical Energy Infrastructure 
Information (CEII), as defined by Sec. 388.113(c) of this chapter, to 
any person, the applicant shall follow the procedures set out in Sec. 
4.32(k).

[Order 533, 56 FR 23153, May 20, 1991, as amended at 56 FR 61155, Dec. 
2, 1991; Order 2002, 68 FR 51117, Aug. 25, 2003; Order 643, 68 FR 52094, 
Sept. 2, 2003; 68 FR 61742, Oct. 30, 2003]