[Federal Register: November 21, 2002 (Volume 67, Number 225)]
[Rules and Regulations]
[Page 70150-70151]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21no02-7]
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DEPARTMENT OF AGRICULTURE
Rural Utilities Service
7 CFR Part 1710
RIN 0572-AB65
Demand Side Management and Renewable Energy Systems
AGENCY: Rural Utilities Service, USDA.
ACTION: Final rule.
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SUMMARY: The Rural Utilities Service (RUS) is removing its regulations
which detail separate policies and requirements for loans for renewable
energy systems and demand side management. Many of these requirements
overlap provisions found elsewhere in part 1710. Others do not seem
well suited for the smaller scale projects of this type that are
becoming increasingly common in the industry. RUS believes that it is
more appropriate to consider such small scale projects in this rapidly
developing segment of the energy industry by proceeding on a case-by-
case basis. By contrast, the balance of part 1710 affords a useful
framework for considering utility-scale energy projects without regard
to whether they are for demand side management or renewable resources.
EFFECTIVE DATES: November 21, 2002.
FOR FURTHER INFORMATION CONTACT: Georg A. Shultz, Chief, Energy
Forecasting Branch, Electric Staff Division, Rural Utilities Service,
U.S. Department of Agriculture, Stop 1569, 1400 Independence Ave., SW.,
Washington, DC 20250-1569. Telephone: (202) 720-1921. FAX: (202) 720-
7491. E-mail: gshultz@rus.usda.gov.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This rule has been determined to be not significant for the
purposes of Executive Order 12866 and, therefore, has not been reviewed
by the Office of Management and Budget (OMB).
Executive Order 12372
This rule is excluded from the scope of Executive Order 12372,
Intergovernmental Consultation, which may require consultation with
State and local officials. See the final rule related notice entitled
``Department Programs and Activities Excluded from Executive Order
12372,'' (50 FR 47034) advising that RUS loans and loan guarantees were
not covered by Executive Order 12372.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. RUS has determined that this rule meets the applicable
standards provided in section 3 of the Executive Order. In addition,
all state and local laws and regulations that are in conflict with this
rule will be preempted; no retroactive effect will be given to this
rule; and, in accordance with section 212(e) of the Department of
Agriculture Reorganization Act of 1994 (7 U.S.C. 6912(e))
administrative appeal procedures, if any are required, must be
[[Page 70151]]
exhausted before an action against the Department or its agencies.
Regulatory Flexibility Act Certification
It has been determined that the Regulatory Flexibility Act is not
applicable to this rule since the Rural Utilities Service is not
required by 5 U.S.C. 551 et seq. or any other provision of law to
publish a notice of proposed rulemaking with respect to the subject
matter of this rule.
National Environmental Policy Act Certification
The Administrator of RUS has determined that this rule will not
significantly affect the quality of the human environment as defined by
the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.).
Therefore, this action does not require an environmental impact
statement or assessment.
Catalog of Federal Domestic Assistance
The program described by this rule is listed in the Catalog of
Federal Domestic Assistance programs under No. 10.850, Rural
Electrification Loans and Loan Guarantees. This catalog is available on
a subscription basis from the Superintendent of Documents, the United
States Government Printing Office, Washington, DC 20402-9325, telephone
number (202) 512-1800.
Information Collection and Recordkeeping Requirements
This rule contains no information collection or recordkeeping
requirements under the Paperwork Reduction Act of 1995 (44 U.S.C.
chapter 35).
Unfunded Mandates
This rule contains no Federal mandates (under the regulatory
provision of title II of the Unfunded Mandates Reform Act) for State,
local, and tribal governments or the private sector. Thus, this rule is
not subject to the requirements of sections 202 and 205 of the Unfunded
Mandates Reform Act.
Background
The Rural Utilities Service (RUS) is removing from part 1710 of its
regulations entitled ``General and Pre-Loan Policies and Procedures''
subpart H thereof, which separately treats demand side management and
renewable energy systems. Subpart H has seldom been used. Since it was
first promulgated in 1994, RUS has averaged less than one of these
loans a year. More recently, changes in the energy industry and
technological advances have produced increased interest in utilizing
these approaches for smaller scaled projects and projects employing
innovative technologies. However, subpart H with its requirements for
such things as integrated resource plans (IRP's) and demand side
management plans present formidable barriers for the development of
smaller projects. Furthermore, the usefulness of such traditional
analytical devices in today's radically changed energy industry has
become questionable. In addition, projects of this sort often possess
unique attributes that make the application of detailed regulations
impractical and sometimes even counterproductive. For example, subpart
H precludes the use of innovative technologies. See 7 CFR 1710.351(a)
and 1710.353. For all of these reasons, RUS believes that subpart H has
become unjustified and unnecessary as a result of changed circumstances
and should be removed or substantially revised.
After considering the low volume of loan requests RUS receives
annually for these loans, the disparate nature of the projects that can
be characterized as demand side management or renewable energy systems,
and the rapidly evolving nature of this industry, RUS has determined
that the removal of subpart H is the better alternative. Accordingly,
RUS will proceed case-by-case in considering requests for demand side
management and renewable energy system loans.
RUS expects that utility scale projects will continue to conform to
the remaining provisions of part 1710 establishing its general and pre-
loan policies and procedures. RUS recognizes that the particular
circumstances of an individual project may necessitate adjustments in
the application or interpretation of its general polices and procedures
to specific demand side management or renewable energy systems loans
regardless of scale. The Administrator may, of course, waive or reduce
any requirement imposed by part 1710 by resorting to the exception
authority contained in the rule itself. See 7 CFR 1710.4. In light of
their rarity so far, RUS anticipates that it may be necessary to
interpret the application of part 1710 to utility scale demand side
management and renewable energy system loans on a somewhat frequent
basis at first. RUS will treat small-scale projects as pilot projects
for which the remainder of part 1710 will serve merely as guidance. As
used in this rule, ``small scale project'' refers to projects
requesting loans less than $5 million or generating less than 10 MW
(nameplate rating). ``Utility scale project'' refers to everything
else.
As RUS acquires greater experience with loans for demand side
management and renewable energy systems, it may reissue regulations on
this subject in the event that the volume of loans requests or the
number of recurring issues raised warrant it. Accordingly, subpart H is
being reserved.
A proposed rule was issued April 25, 2001, at 66 FR 20759, inviting
comments this action. The comment period for this proposed rule ended
May 25, 2001. Only one comment was received. The Regulatory Flexibility
Act Certification discussion has been modified in the Supplementary
Information section of this final rule to respond to the comment. No
changes where made to the text of the rule from that as proposed.
List of Subjects in 7 CFR Part 1710
Electric power, Electric utilities, Loan programs--energy,
Reporting and recordkeeping requirements, Rural areas.
For the reasons set forth in the preamble, RUS amends 7 CFR chapter
XVII, part 1710, as follows:
PART 1710--GENERAL AND PRELOAN POLICIES AND PROCEDURES COMMON TO
INSURED AND GUARANTEED ELECTRIC LOANS
1. The authority citation for part 1710 continues to read as
follows:
Authority: 7 U.S.C. 901 et seq., 1921 et seq., and 6941 et seq.
Subpart H--Demand Side Management and Renewable Energy Systems
Sec. Sec. 1710.350-1710.363 (Subpart H) [Removed and Reserved]
2. Remove and reserve subpart H.
Dated: November 13, 2002.
Hilda Gay Legg,
Administrator, Rural Utilities Service.
[FR Doc. 02-29598 Filed 11-20-02; 8:45 am]
BILLING CODE 3410-15-P