Parker-Davis Project, Pacific Northwest-Pacific Southwest Intertie Project, and the Central Arizona Project-Rate Order No. WAPA-114, 71279-71280 [E5-6572]

Download as PDF Federal Register / Vol. 70, No. 227 / Monday, November 28, 2005 / Notices Applicable To the wholesale power customers for firm power service supplied through one meter at one point of delivery, or as otherwise established by contract. Character Alternating current, 60 hertz, three phase, delivered and metered at the voltages and points established by contract. Monthly Rates First Step: Demand Charge: $3.43 per kilowatt (kW) of billing demand. Energy Charge: 13.06 mills per kilowatthour (kWh) of use. Billing Demand: Unless otherwise specified by contract, the billing demand will be the seasonal contract rate of delivery. Second Step: Demand Charge: $3.59 per kW of billing demand. Energy Charge: 13.68 mills per kWh of use. Billing Demand: Unless otherwise specified by contract, the billing demand will be the seasonal contract rate of delivery. Adjustments For Transformer Losses: If delivery is made at transmission voltage but metered on the low-voltage side of the substation, the meter readings will be increased to compensate for transformer losses as provided for in the contract. For Power Factor: None. The customer will be required to maintain a power factor at all points of measurement between 95-percent lagging and 95percent leading. [FR Doc. E5–6575 Filed 11–25–05; 8:45 am] BILLING CODE 6450–01–P DEPARTMENT OF ENERGY Western Area Power Administration Parker-Davis Project, Pacific Northwest-Pacific Southwest Intertie Project, and the Central Arizona Project—Rate Order No. WAPA–114 Western Area Power Administration, DOE. ACTION: Notice of withdrawal of multisystem transmission rate proposal. SUMMARY: The Western Area Power Administration (Western) initiated a formal rate process for the purpose of implementing a multi-system transmission rate (MSTR) by a Federal Register notice published on June 22, 15:28 Nov 25, 2005 Jkt 208001 During the consultation and comment period for the rate process, Western received comments voicing strong opposition to the proposed methodology. No comments were received in support of the customer choice methodology. The consultation and comment period ended June 1, 2005. All formally submitted comments, both written and oral, were considered in preparing this notice. SUPPLEMENTARY INFORMATION: Comments AGENCY: VerDate Aug<31>2005 2004. The process was extended by a Federal Register notice on March 3, 2005. The purpose of the extension was to allow Western time to respond to customer requests to develop a customer choice model. Western developed and presented a customer choice methodology in public information and public comment forums held March 29, 2005, and April 6, 2005, respectively. Effective November 28, 2005, Western is withdrawing the MSTR proposal for long-term firm transmission service on the Parker-Davis Project (P–DP), the Pacific Northwest-Pacific Southwest Intertie Project (Intertie), and the Central Arizona Project (CAP). Western has considered all comments in its decision to withdraw its proposal for the MSTR for long-term firm transmission service. Western is, however, studying the conversion of non-firm and short-term firm transmission service on the ParkerDavis, Intertie and Central Arizona projects to a multi-system service. Customer notification will be provided and feedback sought in a separate informal process. FOR FURTHER INFORMATION CONTACT: Mr. J. Tyler Carlson, Regional Manager, Desert Southwest Customer Service Region, Western Area Power Administration, P.O. Box 6457, Phoenix, AZ 85005–6457, telephone (602) 605–2453, e-mail carlson@wapa.gov, or Mr. Jack Murray, Rates Team Lead, Desert Southwest Customer Service Region, Western Area Power Administration, P.O. Box 6457, Phoenix, AZ 85005–6457, telephone (602) 605–2442, e-mail jmurray@wapa.gov. Written comments were received from the following organizations: Arizona Power Authority, Arizona Public Service Company, K. R. Saline & Associates, Robert S. Lynch and Associates, Salt River Project. Representatives of the following organizations made oral comments: Irrigation & Electrical Districts Association of Arizona, R. W. Beck, Salt River Project. PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 71279 Western responded to an oral comment received during the Public Information Forum in a letter dated May 17, 2005. The letter is posted on Western’s Web site at http:// www.wapa.gov/dsw/pwrmkt/MSTRP/ MSTRP.htm. Responses in this notice focus on written comments received during the consultation and comment period pertinent to a revised customer choice model and Western’s authority to develop an MSTR. Comment: Western received a comment suggesting it has no legal authority to implement an MSTR of any sort if the revenue requirements of multiple projects will be combined. Comments also questioned whether an MSTR is allowed by DOE Order RA6120.2. Response: Under all MSTR approaches presented by Western, each power system would remain financially independent for accounting and repayment purposes. Each power system would maintain a separate Power Repayment Study (PRS) and financial reports. The total MSTR revenue collected would be allocated to each power system based on the individual power system’s percentage of the total MSTR revenue requirement. Western is not prohibited from implementing such a blended rate by either DOE Order RA 6120.2 or projectspecific legislation. Western has combined the revenue requirements of multiple projects for ratesetting purposes in its other regional offices and continues to set rates in this manner. Comment: A commenter who had asked Western to provide general information on the MSTR more than one year ago believes Western has not provided this information. Response: The specific request had to do with Western’s initial presentation of a customer choice methodology. The presentation consisted mainly of tables and mathematical formulas to explain the circular problem with the method. At the commenter’s request an explanation in words was posted on the Web site in June, 2003 under the heading ‘‘Informal Customer Meeting May 23, 2003’’ linked with the phrase ‘‘Customer Choice Discussion.’’ Comment: A customer commented that the ‘‘customer choice’’ model is an attempt to lower rates for a small group of ‘‘pancaked’’ customers at the expense of the majority of Western’s firm transmission customers. Response: Western undertook the design of the proposed ‘‘customer choice model’’ to address several customers’ comments received during the initial MSTR consultation and E:\FR\FM\28NON1.SGM 28NON1 71280 Federal Register / Vol. 70, No. 227 / Monday, November 28, 2005 / Notices comment period. One of the earliest principles stated by Western in the initial MSTR development was to eliminate the pancaking of firm transmission rates. It was known that any elimination of pancaking of rates will result in a revenue loss to a single power system by virtue of the pancaked customer no longer having to pay two systems’ rates for the same reservation. Western’s customer choice model took this into account and chose a rate which would begin to eliminate pancaking while balancing the risk to the other power systems. Western projected additional other revenues would be realized in sufficient amounts to make up for any losses resulting from MSTR implementation. Comment: A comment suggested Western re-open the public process to develop a customer choice model that would be supported by a majority of customers. Response: Over a 2-year period, Western has explored numerous options for a multi-system transmission rate. Four options were customer choice models using various approaches. In all cases, for Western to be able to collect the full revenue requirement, some customers will incur increased costs as a result of a firm MSTR implementation. In other customer choice models explored by Western, varying levels of support were noted. However in no case did a majority of customers support the methodologies. Support was dependent upon the timing and the extent of potential cost increases. Comment: A comment requested Western calculate the magnitude of rate decreases if revenue projections materialize without implementation of an MSTR. Response: During the public process for the customer choice MSTR, Western presented a table showing some loss of firm revenues to the single system projects due to partial un-pancaking. Western projected mitigating this loss of revenues in order to provide for stable single system rates. Western’s commitment to its customers is to keep rates as stable as possible for the foreseeable future. It is not appropriate to project a rate decrease given the many variables which may impact the rate calculation. Comment: A comment suggested that if the MSTR is implemented, the return of funds to each single system should be based on the amount of transmission revenue lost due to MSTR implementation instead of based on the percentage share of total revenue requirement, as proposed by Western. Response: The method the comment suggested is the methodology Western VerDate Aug<31>2005 15:28 Nov 25, 2005 Jkt 208001 proposed in the initial MSTR presentation which would have had all customers converging to an MSTR in the fifth year. This methodology resulted in a risk of increased costs to some customers. The comments received at that time correctly noted that any MSTR method that eliminates pancaking presents a risk of cost increases. However, MSTR could help mitigate this risk by freeing up additional capacity for sale. Comment: Several comments suggested that Western abandon this proposal because the risks outweigh the benefits. Response: After careful consideration of all comments, Western is withdrawing the proposal for a firm point-to-point MSTR rate at this time. Availability of Information All brochures, studies, comments, letters, memorandums, or other documents that Western initiates or uses to develop the proposed rates are available for inspection and copying at the Desert Southwest Customer Service Regional Office, Western Area Power Administration, located at 615 South 43rd Avenue, Phoenix, Arizona. Many of these documents and supporting information are also available on Western’s Web site at http:// www.wapa.gov/dsw/pwrmkt/MSTRP/ MSTRP.htm. Regulatory Procedure Requirements Regulatory Flexibility Analysis The Regulatory Flexibility Act of 1980 (5 U.S.C. 601, et seq.) requires Federal agencies to perform a regulatory flexibility analysis if a final rule is likely to have a significant economic impact on a substantial number of small entities and there is a legal requirement to issue a general notice of proposed rulemaking. This action does not require a regulatory flexibility analysis since it is a rulemaking of particular applicability involving rates or services applicable to public property. Environmental Compliance In compliance with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321, et seq.); Council on Environmental Quality Regulations (40 CFR parts 1500–1508); and DOE NEPA Regulations (10 CFR part 1021), Western has determined this action is categorically excluded from preparing an environmental assessment or an environmental impact statement. Determination Under Executive Order 12866 Western has an exemption from centralized regulatory review under PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 Executive Order 12866; accordingly, no clearance of this notice by the Office of Management and Budget is required. Small Business Regulatory Enforcement Fairness Act Western has determined that this rule is exempt from congressional notification requirements under 5 U.S.C. 801 because the action is a rulemaking of particular applicability relating to rates or services and involves matters of procedure. Dated: November 9, 2005. Michael S. Hacskaylo, Administrator. [FR Doc. E5–6572 Filed 11–25–05; 8:45 am] BILLING CODE 6450–01–P DEPARTMENT OF ENERGY Western Area Power Administration Pick-Sloan Missouri Basin Program— Eastern Division—Rate Order No. WAPA–126 Western Area Power Administration, DOE. ACTION: Notice of order concerning power rates. AGENCY: SUMMARY: The Deputy Secretary of Energy confirmed and approved Rate Order No. WAPA–126 and Rate Schedules P–SED–F8 and P–SED–FP8, placing firm power and firm peaking power rates from the Pick-Sloan Missouri Basin Program—Eastern Division (P–SMBP—ED) of the Western Area Power Administration (Western) into effect on an interim basis. The provisional rates will be in effect until the Federal Energy Regulatory Commission (Commission) confirms, approves, and places them into effect on a final basis or until they are replaced by other rates. The provisional rates will provide sufficient revenue to pay all annual costs, including interest expense, and repay power investment and irrigation aid, within the allowable periods. DATES: Rate Schedules P–SED–F8 and P–SED–FP8 will be placed into effect on an interim basis on the first day of the first full billing period beginning on or after January 1, 2006, and will be in effect until the Commission confirms, approves, and places the rate schedules in effect on a final basis ending December 31, 2010, or until the rate schedules are superseded. FOR FURTHER INFORMATION CONTACT: Mr. Robert J. Harris, Regional Manager, Upper Great Plains Region, Western Area Power Administration, 2900 4th Avenue North, Billings, MT 59101– E:\FR\FM\28NON1.SGM 28NON1

Agencies

[Federal Register Volume 70, Number 227 (Monday, November 28, 2005)]
[Notices]
[Pages 71279-71280]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E5-6572]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Parker-Davis Project, Pacific Northwest-Pacific Southwest 
Intertie Project, and the Central Arizona Project--Rate Order No. WAPA-
114

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of withdrawal of multi-system transmission rate 
proposal.

-----------------------------------------------------------------------

SUMMARY: The Western Area Power Administration (Western) initiated a 
formal rate process for the purpose of implementing a multi-system 
transmission rate (MSTR) by a Federal Register notice published on June 
22, 2004. The process was extended by a Federal Register notice on 
March 3, 2005. The purpose of the extension was to allow Western time 
to respond to customer requests to develop a customer choice model. 
Western developed and presented a customer choice methodology in public 
information and public comment forums held March 29, 2005, and April 6, 
2005, respectively. Effective November 28, 2005, Western is withdrawing 
the MSTR proposal for long-term firm transmission service on the 
Parker-Davis Project (P-DP), the Pacific Northwest-Pacific Southwest 
Intertie Project (Intertie), and the Central Arizona Project (CAP). 
Western has considered all comments in its decision to withdraw its 
proposal for the MSTR for long-term firm transmission service. Western 
is, however, studying the conversion of non-firm and short-term firm 
transmission service on the Parker-Davis, Intertie and Central Arizona 
projects to a multi-system service. Customer notification will be 
provided and feedback sought in a separate informal process.

FOR FURTHER INFORMATION CONTACT: Mr. J. Tyler Carlson, Regional 
Manager, Desert Southwest Customer Service Region, Western Area Power 
Administration, P.O. Box 6457, Phoenix, AZ 85005-6457, telephone (602) 
605-2453, e-mail carlson@wapa.gov, or Mr. Jack Murray, Rates Team Lead, 
Desert Southwest Customer Service Region, Western Area Power 
Administration, P.O. Box 6457, Phoenix, AZ 85005-6457, telephone (602) 
605-2442, e-mail jmurray@wapa.gov.

SUPPLEMENTARY INFORMATION: During the consultation and comment period 
for the rate process, Western received comments voicing strong 
opposition to the proposed methodology. No comments were received in 
support of the customer choice methodology.
    The consultation and comment period ended June 1, 2005. All 
formally submitted comments, both written and oral, were considered in 
preparing this notice.

Comments

    Written comments were received from the following organizations: 
Arizona Power Authority, Arizona Public Service Company, K. R. Saline & 
Associates, Robert S. Lynch and Associates, Salt River Project.
    Representatives of the following organizations made oral comments: 
Irrigation & Electrical Districts Association of Arizona, R. W. Beck, 
Salt River Project.
    Western responded to an oral comment received during the Public 
Information Forum in a letter dated May 17, 2005. The letter is posted 
on Western's Web site at http://www.wapa.gov/dsw/pwrmkt/MSTRP/
MSTRP.htm. Responses in this notice focus on written comments received 
during the consultation and comment period pertinent to a revised 
customer choice model and Western's authority to develop an MSTR.
    Comment: Western received a comment suggesting it has no legal 
authority to implement an MSTR of any sort if the revenue requirements 
of multiple projects will be combined. Comments also questioned whether 
an MSTR is allowed by DOE Order RA6120.2.
    Response: Under all MSTR approaches presented by Western, each 
power system would remain financially independent for accounting and 
repayment purposes. Each power system would maintain a separate Power 
Repayment Study (PRS) and financial reports. The total MSTR revenue 
collected would be allocated to each power system based on the 
individual power system's percentage of the total MSTR revenue 
requirement.
    Western is not prohibited from implementing such a blended rate by 
either DOE Order RA 6120.2 or project-specific legislation. Western has 
combined the revenue requirements of multiple projects for ratesetting 
purposes in its other regional offices and continues to set rates in 
this manner.
    Comment: A commenter who had asked Western to provide general 
information on the MSTR more than one year ago believes Western has not 
provided this information.
    Response: The specific request had to do with Western's initial 
presentation of a customer choice methodology. The presentation 
consisted mainly of tables and mathematical formulas to explain the 
circular problem with the method. At the commenter's request an 
explanation in words was posted on the Web site in June, 2003 under the 
heading ``Informal Customer Meeting May 23, 2003'' linked with the 
phrase ``Customer Choice Discussion.''
    Comment: A customer commented that the ``customer choice'' model is 
an attempt to lower rates for a small group of ``pancaked'' customers 
at the expense of the majority of Western's firm transmission 
customers.
    Response: Western undertook the design of the proposed ``customer 
choice model'' to address several customers' comments received during 
the initial MSTR consultation and

[[Page 71280]]

comment period. One of the earliest principles stated by Western in the 
initial MSTR development was to eliminate the pancaking of firm 
transmission rates. It was known that any elimination of pancaking of 
rates will result in a revenue loss to a single power system by virtue 
of the pancaked customer no longer having to pay two systems' rates for 
the same reservation. Western's customer choice model took this into 
account and chose a rate which would begin to eliminate pancaking while 
balancing the risk to the other power systems. Western projected 
additional other revenues would be realized in sufficient amounts to 
make up for any losses resulting from MSTR implementation.
    Comment: A comment suggested Western re-open the public process to 
develop a customer choice model that would be supported by a majority 
of customers.
    Response: Over a 2-year period, Western has explored numerous 
options for a multi-system transmission rate. Four options were 
customer choice models using various approaches. In all cases, for 
Western to be able to collect the full revenue requirement, some 
customers will incur increased costs as a result of a firm MSTR 
implementation. In other customer choice models explored by Western, 
varying levels of support were noted. However in no case did a majority 
of customers support the methodologies. Support was dependent upon the 
timing and the extent of potential cost increases.
    Comment: A comment requested Western calculate the magnitude of 
rate decreases if revenue projections materialize without 
implementation of an MSTR.
    Response: During the public process for the customer choice MSTR, 
Western presented a table showing some loss of firm revenues to the 
single system projects due to partial un-pancaking. Western projected 
mitigating this loss of revenues in order to provide for stable single 
system rates. Western's commitment to its customers is to keep rates as 
stable as possible for the foreseeable future. It is not appropriate to 
project a rate decrease given the many variables which may impact the 
rate calculation.
    Comment: A comment suggested that if the MSTR is implemented, the 
return of funds to each single system should be based on the amount of 
transmission revenue lost due to MSTR implementation instead of based 
on the percentage share of total revenue requirement, as proposed by 
Western.
    Response: The method the comment suggested is the methodology 
Western proposed in the initial MSTR presentation which would have had 
all customers converging to an MSTR in the fifth year.
    This methodology resulted in a risk of increased costs to some 
customers. The comments received at that time correctly noted that any 
MSTR method that eliminates pancaking presents a risk of cost 
increases. However, MSTR could help mitigate this risk by freeing up 
additional capacity for sale.
    Comment: Several comments suggested that Western abandon this 
proposal because the risks outweigh the benefits.
    Response: After careful consideration of all comments, Western is 
withdrawing the proposal for a firm point-to-point MSTR rate at this 
time.

Availability of Information

    All brochures, studies, comments, letters, memorandums, or other 
documents that Western initiates or uses to develop the proposed rates 
are available for inspection and copying at the Desert Southwest 
Customer Service Regional Office, Western Area Power Administration, 
located at 615 South 43rd Avenue, Phoenix, Arizona. Many of these 
documents and supporting information are also available on Western's 
Web site at http://www.wapa.gov/dsw/pwrmkt/MSTRP/MSTRP.htm.

Regulatory Procedure Requirements

Regulatory Flexibility Analysis

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601, et seq.) 
requires Federal agencies to perform a regulatory flexibility analysis 
if a final rule is likely to have a significant economic impact on a 
substantial number of small entities and there is a legal requirement 
to issue a general notice of proposed rulemaking. This action does not 
require a regulatory flexibility analysis since it is a rulemaking of 
particular applicability involving rates or services applicable to 
public property.

Environmental Compliance

    In compliance with the National Environmental Policy Act of 1969 
(NEPA) (42 U.S.C. 4321, et seq.); Council on Environmental Quality 
Regulations (40 CFR parts 1500-1508); and DOE NEPA Regulations (10 CFR 
part 1021), Western has determined this action is categorically 
excluded from preparing an environmental assessment or an environmental 
impact statement.

Determination Under Executive Order 12866

    Western has an exemption from centralized regulatory review under 
Executive Order 12866; accordingly, no clearance of this notice by the 
Office of Management and Budget is required.

Small Business Regulatory Enforcement Fairness Act

    Western has determined that this rule is exempt from congressional 
notification requirements under 5 U.S.C. 801 because the action is a 
rulemaking of particular applicability relating to rates or services 
and involves matters of procedure.

    Dated: November 9, 2005.
Michael S. Hacskaylo,
Administrator.
 [FR Doc. E5-6572 Filed 11-25-05; 8:45 am]
BILLING CODE 6450-01-P