distribution lines (69 kV or less); and (8) water intake or pumping facilities that do not extract more than one million gallons per day from a project reservoir. No later than January 31 of each year, the licensees shall file three copies of a report briefly describing for each conveyance made under this paragraph (c) during the prior calendar year, the type of interest conveyed, the location of the lands subject to the conveyance, and the nature of the use for which the interest was conveyed.

(d) The licensees may convey fee title to, easements or rights-of-way across, or leases of project lands for: (1) construction of new bridges or roads for which all necessary state and federal approvals have been obtained; (2) sewer or effluent lines that discharge into project waters, for which all necessary federal and state water quality certification or permits have been obtained; (3) other pipelines that cross project lands or waters but do not discharge into project waters; (4) nonproject overhead electric transmission lines that require erection of support structures within the project boundary, for which all necessary federal and state approvals have been obtained; (5) private or public marinas that can accommodate no more than 10 watercraft at a time and are located at least one-half mile from any other private or public marina; (6) recreational development consistent with an approved exhibit R or approved report on recreational resources of an exhibit E; and (7) other uses, if: (i) the amount of land conveyed for a particular use is five acres or less; (ii) all of the land conveyed is located at least 75 feet, measured horizontally, from the edge of the project reservoir at normal maximum surface elevation; and (iii) no more than 50 total acres of project lands for each project development are conveyed under this clause (d)(7) in any calendar year. At least 45 days before conveying any interest in project lands under this paragraph (d), the licensees must submit a letter to the Director, Office of Hydropower Licensing, stating its intent to convey the interest and briefly describing the type of interest and location of the lands to be conveyed (a marked exhibit G or K map may be used), the nature of the proposed use, the identity of any federal or state agency official consulted, and any federal or state approvals required for the proposed use. Unless the Director, within 45 days from the filing date, requires the licensees to file an application for prior approval, the licensees may convey the intended interest at the end of that period.

(e) The following additional conditions apply to any intended conveyance under paragraph (c) or (d) of this article:

(1) Before conveying the interest, the licensees shall consult with federal and state fish and wildlife or recreation agencies, as appropriate, and the State Historic Preservation Officer.

(2) Before conveying the interest, the licensees shall determine that the proposed use of the lands to be conveyed is not inconsistent with any approved exhibit R or approved report on recreational resources of an exhibit E; or, if the project does not have an approved exhibit R or approved report on recreational resources, that the lands to be conveyed do not have recreational value.

(3) The instrument of conveyance must include covenants running with the land adequate to ensure that: (i) the use of the lands conveyed shall not endanger health, create a nuisance, or otherwise be incompatible with overall project recreational use; and (ii) the grantee shall take all reasonable precautions to ensure that the construction, operation, and maintenance of structures or facilities on the conveyed lands will occur in a manner that will protect the scenic, recreational, and environmental values of the project.

(4) The Commission reserves the right to require the licensees to take reasonable remedial action to correct any violation of the terms and conditions of this article, for the protection and enhancement of the project's scenic, recreational, and other environmental values.

(f) The conveyance of an interest in project lands under this article does not in itself change the project boundaries. The project boundaries may be changed to exclude land conveyed under this article only upon approval of revised exhibit G or K drawings (project boundary maps) reflecting exclusion of that land. Lands conveyed under this article will be excluded from the project only upon a determination that the lands are not necessary for project purposes, such as operation and maintenance, flowage, recreation, public access, protection of environmental resources, and shoreline control, including shoreline aesthetic values. Absent extraordinary circumstances, proposals to exclude lands conveyed under this article from the project shall be consolidated for consideration when revised exhibit G or K drawings would be filed for approval for other purposes.

(g) The authority granted to the licensees under this article shall not apply to any part of the public lands and reservations of the United States included within the project boundary.

(F) The licensees shall serve copies of any Commission filing required by this order on any entity specified in this order to be consulted on matters related to that filing. Proof of

service on these entities must accompany the filing with the Commission.

(G) This order is issued under authority delegated to the Director and constitutes final agency action. Requests for rehearing by the Commission may be filed within 30 days of the date of issuance of this order, pursuant to 18 C.F.R. section 385.713. Filing a rehearing does not stay the effective date of this order or any date specified in this order. The licensees' failure to file a rehearing shall constitute acceptance of the license.

Environmental Assessment

Federal Energy Regulatory Commission Office of Hydropower Licensing, Division of Project Review

Coneross Hydroelectric Project FERC Project No. 6731-001-South Carolina February 28, 1991

I. Application

On October 7, 1988, the Aquenergy Systems, Incorporated and Coneross Power Corporation (Aquenergy) filed an application for a license for the existing unlicensed Coneross Hydroelectric Project. On August 7, 1990, Aquenergy supplemented its application.

The project is located on the Coneross Creek near Seneca, Oconee County, South Carolina (Figure 1).

II. Purpose and Need for Action A. Purpose

The existing project would generate an estimated 3,425,000 kilowatt hours (kWh) of elec

tric energy per year which will be sold to the Seneca Light & Water Company.

B. Need for Power

Aquenergy is a wholly owned subsidiary of Consolidated Hydro Southeast, Inc., a private entrepreneur. The applicant is not an electric utility and hence has no distribution facilities and has no end-use customers who need a reliable source of electric power. As a result, it is appropriate to use a broadened view of the "need for power" issue which is based on the unique virtues of hydroelectric generation and which recognizes some growing public interest

concerns.

Operation Desert Shield and Desert Storm have dealt a serious blow to the already crumbling willingness of the United States to rely on the use of oil to generate electricity most especially on oil from the Middle East. Public concerns about global warming are becoming more pervasive - nationally and internationally. The projected costs of complying with the new regulations of the radically revised and substantially more stringent Clean Air Act are escalating with each new projection. As a result, the opposition to the combustion of coal to meet growing demands for electric energy is making it difficult to obtain regulatory approval for the construction of new coal-fired steam-electric power plants.

Hydroelectric power plants produce no atmospheric pollution, their primary energy is derived from a renewable resource. They are highly reliable, long-lived and over the long-run have no close competitor as a source of low-cost electric energy.

In our broadened view of the need for power issue, we believe that, in all instances where economic, financial and environmental considerations permit, it is in the best interest of the public to develop hydroelectric capacity whenever the opportunity arises. The Coneross Project has already been developed and has been in operation since 1985. From a power-development perspective, it would be in the best interest of the public to grant the applicant a license, thus avoiding any interruption in the project's operation.

III. Proposed Project and Alternatives

A. Proposed Project

Hydropower was originally developed at the Coneross Project site in the late 1890's to early 1900's by the Seneca Manufacturing Company. The project generated hydroelectric power for a mill in Seneca until 1953, when it was abandoned. Aquenergy purchased the project in 1984 and restored the project using the existing structures; constructing a new powerhouse; and installing new turbines, generators, and switch

gear. The renovated project started operation in October 1985, selling all generated electricity to Seneca, SC (Aquenergy, 1988).

The existing constructed project (Figure 2, page 4) consists of: (a) a 288-foot-long and 25-foot-high concrete dam; (b) a 123-foot-long and 20-foot-high concrete spillway with 1.5-foot flashboards; (c) a 9-acre reservoir having a gross storage capacity of 13.5 acre-feet; (d) an intake gate and trashracks; (e) a 780-foot-long and 8-foot-diameter concrete penstock; (f) a concrete powerhouse housing three generating units (one 540 kW, one 243 kW, and one 106 kW) for a total installed capacity of 889 kW; (g) a 95-foot-long tailrace; (h) a 93-foot-long, 12.47-kV transmission line; (i) one bank of three 500-kVA transformers to step-up the 3-phase 2.3-kV line-to-line voltage to 12.47-kV line-to-line; (j) 2.3-kV and 12.47-kV switchgear; and (k) appurtenant facilities. Aquenergy does not propose any changes to the existing project works.

B. Proposed Mitigative Measures

1. Construction. No construction is proposed. The project is currently operating to provide electricity. It was found to be jurisdictional by the Federal Energy Regulatory Commission (FERC or Commission), thereby requiring a license.

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