; and (vii) provide an enhanced opportunity for self-supply of electric generating capacity resources by electric cooperatives, Federal power marketing agencies, and State utilities with a service obligation (as those terms are defined in section 217(a)) of the Federal Power Act ( 16 U.S.C. 824q(a) )) in a manner that is consistent with traditional utility business models and does not unduly affect wholesale market prices. 2314. Technology demonstration on the distribution system (a) In general The Secretary shall establish a grant program to carry out eligible projects related to the modernization of the electric grid, including the application of technologies to improve observability, advanced controls, and prediction of system performance on the distribution system. (b) Eligible projects To be eligible for a grant under subsection (a), a project shall— (1) be designed to improve the performance and efficiency of the future electric grid, while ensuring the continued provision of safe, secure, reliable, and affordable power; (2) demonstrate— (A) secure integration and management of 2 or more energy resources, including distributed energy generation, combined heat and power, microgrids, energy storage, electric vehicles, energy efficiency, demand response, and intelligent loads; and (B) secure integration and interoperability of communications and information technologies; and (3) be subject to the requirements of section 545(a) of the Energy Security and Independence Act of 2007 ( 42 U.S.C. 17155(a) ). III Supply A Renewables I Hydroelectric 3001. Federal Power Act amendments (a) Hydropower regulatory improvements (1) Sense of Congress on use of hydropower renewable resources It is the sense of Congress that— (A) hydropower is a renewable resource for purposes of all Federal programs and is an essential source of energy in the United States