Assist municipalities and local communities to explore and determine options for the alternative provision of electricity and to create new public power systems, and for other purposes.

Establishes the Community Power Investment Revolving Loan Fund. Authorizes the Secretary of Energy to make loans from such Fund to a State, local, or municipal government in sound financial standing for the development of alternative energy and energy delivery systems. Prescribes loan repayment guidelines.

Amends the Federal Power Act to direct the Federal Energy Regulatory Commission to prohibit any public utility or State regulatory authority from imposing any fee or charge on any electric consumer, State, or municipality for the purpose of recovering wholesale stranded costs it may incur when retail electric consumers cease to be served by that public utility by reason of the provision of electric service by a State or local government.

Amends the Internal Revenue Code to repeal the restriction placed upon the use of tax-exempt bonds to acquire nongovernmental output property.