Federal Power Act Amendments of 1983 - Amends the Federal Power Act to define the term "qualified exemption applicant" as any person, State, or municipality which: (1) meets the requirements of an application for exemption from the regulation of water power and resources development under such Act; and (2) has property interests necessary for the development of a proposed hydroelectric project, exclusive of any property interests necessary for a transmission right of way.

Requires the Federal Energy Regulatory Commission to give preference when issuing preliminary permits or licenses for hydroelectric projects to qualified exemption applicants and to applicants who have the necessary property interests for the development of a proposed hydroelectric project, in addition to States and municipalities which apply for such permits or licenses, except where the Commission decides that project development should be undertaken by the Government or where another permit or license applicant has substantially superior plans for such a project.

Provides that when a licensee exercises the power of eminent domain, the amount of compensation to be paid by the licensee to the property owner shall be based on the highest and best use for which the property subject to condemnation may be put.