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Federal Power Act of 1920

The Federal Power Act of 1920 appears in 16 USCS § 791a.  The Act was enacted to coordinate the hydroelectric projects in the U.S, and it encouraged the development of hydroelectric projects, such as dams and reservoirs.  The Act is also known as the Federal Water Power Act.

The original Act was enacted in the year 1920.  Subsequently, many amendments were made respectively in the year 1935 and 1986.  These amendments added new provisions that incorporated fish and wildlife concerns in licensing, re-licensing, and exemption procedures.

The Act generally provides for cooperation between the Federal Energy Regulatory Commission (FERC) and other Federal agencies, including resource agencies in licensing and re-licensing power projects.

Under the Act, a Federal Power Commission (FPC) is created and established.  The FPC is composed of five commissioners.  All appointments in the FPC are made by the President with the advice and consent of the Senate.  One among the five commissioners will be designated by the President as chairman and s/he shall be the principal executive officer of the FPC.  Provided, upon the expiry of the term of the commissioner so designated as chairman by the President, the chairmen shall be elected by the FPC itself.  Each chairman so elected shall serve the office until the expiration of his/her term of office[i].  In the case of the absence or disability of the chairman or in case of a vacancy in the office of chairman, the vice chairman appointed by the FPC shall perform the functions of the chairman.

The general sessions of the FPC are held in the principal office which is in the District of Columbia.  Sometimes, for the convenience of the public or of the parties, the FPC shall hold special sessions in any part of the U.S.  The business and transactions of the FPC are carried out through a quorum which shall consist of three of its members[ii].

The general powers granted to the FPC under the Act include[iii]:

  • to investigate, collect and record data concerning the utilization of the water resources of any region to be developed;
  • to determine the actual legitimate original cost of and the net investment of a licensed project;
  • to cooperate with the executive departments and other agencies of State or National Governments to conduct such investigations;
  • to make public from time to time the information gathered; and to provide for the publication of its reports and investigations in such form and manner as may be best adapted for public information and use;
  • to issue licenses to citizens of the U.S. or to any association of such citizens, or to any corporation organized under the laws of the U.S. or any State thereof, or to any State or municipality for the purpose of constructing, operating, and maintaining dams, water conduits, reservoirs, power houses, transmission lines, or other project works necessary or convenient for the development and improvement of navigation;
  • to issue preliminary permits for the purpose of sanctioning license to applicants;
  • to order an investigation of any occupancy of, or evidenced intention to occupy, for the purpose of developing electric power, public lands, reservations, or streams or other bodies of water; and
  • to issue appropriate and expedient orders to conserve and utilize the navigation and water-power resources of the region in the interest of public.


The FPC while determining the question of issuing a license will give equal consideration to the following points such as power and development, energy conservation, protection, mitigation of damage to, and enhancement of, fish and wildlife, protection of recreational opportunities, and preservation of other aspects of environmental quality.

[i] 16 USCS § 792.

[ii] Id.

[iii] 16 USCS § 797.

Inside Federal Power Act of 1920