§ 836. — Authorization to license construction and operation; licensing conditions.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 16USC836]
TITLE 16--CONSERVATION
CHAPTER 12E--NIAGARA POWER PROJECT
Sec. 836. Authorization to license construction and operation;
licensing conditions
(a) The Federal Energy Regulatory Commission is expressly authorized
and directed to issue a license to the Power Authority of the State of
New York for the construction and operation of a power project with
capacity to utilize all of the United States share of the water of the
Niagara River permitted to be used by international agreement.
(b) The Federal Energy Regulatory Commission shall include among the
licensing conditions, in addition to those deemed necessary and required
under the terms of the Federal Power Act [16 U.S.C. 791a et seq.], the
following:
(1) In order to assure that at least 50 per centum of the
project power shall be available for sale and distribution primarily
for the benefit of the people as consumers, particularly domestic
and rural consumers, to whom such power shall be made available at
the lowest rates reasonably possible and in such manner as to
encourage the widest possible use, the licensee in disposing of 50
per centum of the project power shall give preference and priority
to public bodies and nonprofit cooperatives within economic
transmission distance. In any case in which project power subject to
the preference provisions of this paragraph is sold to utility
companies organized and administered for profit, the licensee shall
make flexible arrangements and contracts providing for the
withdrawal upon reasonable notice and fair terms of enough power to
meet the reasonably foreseeable needs of the preference customers.
(2) The licensee shall make a reasonable portion of the project
power subject to the preference provisions of paragraph (1) of this
subsection available for use within reasonable economic transmission
distance in neighboring States, but this paragraph shall not be
construed to require more than 20 per centum of the project power
subject to such preference provisions to be made available for use
in such States. The licensee shall cooperate with the appropriate
agencies in such States to insure compliance with this requirement.
In the event of disagreement between the licensee and the power-
marketing agencies of any of such States, the Federal Energy
Regulatory Commission may, after public hearings, determine and fix
the applicable portion of power to be made available and the terms
applicable thereto: Provided, That if any such State shall have
designated a bargaining agency for the procurement of such power on
behalf of such State, the licensee shall deal only with such agency
in that State. The arrangements made by the licensee for the sale of
power to or in such State shall include observance of the
preferences in paragraph (1) of this subsection.
(3) The licensee shall contract, with the approval of the
Governor of the State of New York, pursuant to the procedure
established by New York law, to sell to the licensee of Federal
Energy Regulatory Commission project 16 for a period ending not
later than the final maturity date of the bonds initially issued to
finance the project works herein specifically authorized, four
hundred and forty-five thousand kilowatts of the remaining project
power, which is equivalent to the amount produced by project 16
prior to June 7, 1956, for resale generally to the industries which
purchase power produced by project 16 prior to such date, or their
successors, in order as nearly as possible to restore low power
costs to such industries and for the same general purposes for which
power from project 16 was utilized: Provided, That the licensee of
project 16 consents to the surrender of its license at the
completion of the construction of such project works upon terms
agreed to by both licensees and approved by the Federal Energy
Regulatory Commission which shall include the following: (a) the
licensee of project 16 shall waive and release any claim for
compensation or damages from the Power Authority of the State of New
York or from the State of New York, except just compensation for
tangible property and rights-of-way actually taken, and (b) without
limiting the generality of the foregoing, the licensee of project 16
shall waive all claims to compensation or damages based upon loss of
or damage to riparian rights, diversionary rights, or other rights
relating to the diversion or use of water, whether founded on
legislative grant or otherwise.
(4) The licensee shall, if available on reasonable terms and
conditions, acquire by purchase or other agreement, the ownership or
use of, or if unable to do so, construct such transmission lines as
may be necessary to make the power and energy generated at the
project available in wholesale quantities for sale on fair and
reasonable terms and conditions to privately owned companies, to the
preference customers enumerated in paragraph (1) of this subsection,
and to the neighboring States in accordance with paragraph (2) of
this subsection.
(5) In the event project power is sold to any purchaser for
resale, contracts for such sale shall include adequate provisions
for establishing resale rates, to be approved by the licensee,
consistent with paragraphs (1) and (3) of this subsection.
(6) The licensee, in cooperation with the appropriate agency of
the State of New York which is concerned with the development of
parks in such State, may construct a scenic drive and park on the
American side of the Niagara River, near the Niagara Falls, pursuant
to a plan the general outlines of which shall be approved by the
Federal Energy Regulatory Commission; and the cost of such drive and
park shall be considered a part of the cost of the power project and
part of the licensee's net investment in said project: Provided,
That the maximum part of the cost of such drive and park to be borne
by the power project and to be considered a part of the licensee's
net investment shall not exceed $15,000,000.
(7) The licensee shall pay to the United States and include in
its net investment in the project herein authorized the United
States share of the cost of the construction of the remedial works,
including engineering and economic investigations, undertaken in
accordance with article II of the treaty between the United States
of America and Canada concerning uses of the waters of the Niagara
River signed February 27, 1950, whenever such remedial works are
constructed.
(Pub. L. 85-159, Sec. 1, Aug. 21, 1957, 71 Stat. 401; Pub. L. 95-91,
title IV, Sec. 402(a)(1)(A), Aug. 4, 1977, 91 Stat. 583.)
References in Text
The Federal Power Act, referred to in subsec. (b), is act June 10,
1920, ch. 285, 41 Stat. 1063, as amended, which is classified generally
to chapter 12 (Sec. 791a et seq.) of this title. For complete
classification of this Act to the Code, see section 791a of this title
and Tables.
Transfer of Functions
``Federal Energy Regulatory Commission'' substituted in text for
``Federal Power Commission'' pursuant to Pub. L. 95-91,
Sec. 402(a)(1)(A), which is classified to section 7172(a)(1)(A) of Title
42, The Public Health and Welfare.
Federal Power Commission terminated and its functions, personnel,
property, funds, etc., transferred to Secretary of Energy (except for
certain functions transferred to Federal Energy Regulatory Commission)
by sections 7151(b), 7171(a), 7172(a), 7291, and 7293 of Title 42.
