Central Arizona Project-Rate Order No. WAPA-124, 1533-1538 [E6-110]
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Federal Register / Vol. 71, No. 6 / Tuesday, January 10, 2006 / Notices
Availability of Information
Information regarding this rate
increase, including studies and other
supporting material, is available for
public review and comment in the
offices of Southwestern Power
Administration, One West Third Street,
Tulsa, Oklahoma 74103.
Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.
[FR Doc. E6–108 Filed 1–9–06; 8:45 am]
BILLING CODE 6450–01–P
DEPARTMENT OF ENERGY
Comments and Responses
Western Area Power Administration
Southwestern received one written
comment in which the customer
representative expressed no objection to
the proposed rate adjustment.
Central Arizona Project—Rate Order
No. WAPA–124
Other Issues
There were no other issues raised
during the informal period or during the
formal public participation period.
Administrator’s Certification
The 2005 Revised Rayburn PRS
indicates that the annual power rate of
$2,816,064 will repay all costs of the
project, including amortization of the
power investment consistent with
provisions of the Department of Energy
(DOE) Order No. RA 6120.2. In
accordance with Delegation Order Nos.
00–037.00 (December 6, 2001) and 00–
001.00B (July 28, 2005), and Section 5
of the Flood Control Act of 1944, the
Administrator has determined that the
proposed Rayburn power rate is
consistent with applicable law and the
lowest possible rate consistent with
sound business principles.
Environment
The environmental impact of the rate
increase proposal was evaluated in
consideration of DOE’s guidelines for
implementing the procedural provisions
of the National Environmental Policy
Act, 10 CFR 1021, and was determined
to fall within the class of actions that are
categorically excluded from the
requirements of preparing either an
Environmental Impact Statement or an
Environmental Assessment.
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Order
In view of the foregoing and pursuant
to the authority delegated to me, I
hereby confirm, approve and place in
effect on an interim basis, for the period
January 1, 2006, through September 30,
2009, the annual Sam Rayburn Dam
Rate of $2,816,064 for the sale of power
and energy from Sam Rayburn Dam to
the Sam Rayburn Electric Cooperative,
Inc., under Contract No. DE–PM75–
92SW00215, dated October 7, 1992.
This rate shall remain in effect on an
interim basis through September 30,
2009, or until the FERC confirms and
approves the rate on a final basis.
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Western Area Power
Administration, DOE.
ACTION: Notice of order concerning
transmission service rates.
AGENCY:
SUMMARY: The Deputy Secretary of
Energy confirmed and approved Rate
Order No. WAPA–124 and Rate
Schedules CAP–FT2, CAP–NFT2, and
CAP–NITS2, placing transmission rates
from the Central Arizona Project (CAP)
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
repayment of power investment, within
the allowable periods.
DATES: Rate Schedules CAP–FT2, CAP–
NFT2, and CAP–NITS2 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 through December 31, 2010,
or until the rate schedules are
superseded.
Mr.
J. Tyler Carlson, Regional Manager,
Desert Southwest Customer Service
Region, Western Area Power
Administration, P.O. Box 6457,
Phoenix, AZ 85005–6457, (602) 605–
7348, e-mail carlson@wapa.gov, or Mr.
Jack D. Murray, Rates Team Lead, Desert
Southwest Customer Service Region,
Western Area Power Administration,
P.O. Box 6457, Phoenix, AZ 85005–
6457, (602) 605–2442, e-mail
jmurray@wapa.gov.
FOR FURTHER INFORMATION CONTACT:
The
Deputy Secretary of Energy approved
Rate Schedules CAP–FT1, CAP–NFT1,
and CAP–NITS1 for transmission
service on December 11, 2000 (Rate
Order No. WAPA–88, 65 FR 77368,
SUPPLEMENTARY INFORMATION:
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1533
December 11, 2000). The Commission
confirmed and approved the rate
schedules on July 31, 2001, in FERC
Docket No. EF01–5111–000. The
existing rate schedules CAP–FT1, CAP–
NFT1, and CAP–NITS1 are effective
from January 1, 2001, through December
31, 2005.
The existing rate schedules are being
superseded by rate schedules CAP–FT2,
CAP–NFT2, and CAP–NITS2. The
provisional formula rates for point-topoint transmission service and Network
Integration Transmission Service (NITS)
on the CAP 115kV and 230–kV
transmission lines are based on the
calculation of a revenue requirement
that recovers the CAP 115kV and 230–
kV transmission lines costs for facilities
associated with providing transmission
service and the non-facilities costs
allocated to transmission service. These
rate formulas include costs for
scheduling, system control, and
dispatch service. The provisional rates
for point-to-point transmission service
on the CAP 115–kV/230–kV
transmission system are determined by
combining the average annual
amortization costs with the average
annual operations and maintenance
costs, and dividing them by the average
annual contract rate of delivery for the
5-year period FY 2006–FY 2010.
The revised formula rates reflect a
2.87-percent decrease for 2006 when
compared to the existing CAP
transmission rates, which expire
December 31, 2005. The decrease in the
firm point-to-point rate is the result of
increased transmission reservations
combined with relatively stable
expenses since the approval of Rate
Order WAPA–88. Implementation of the
revised formula rates will result in a
firm transmission service rate of $9.55
per kilowattyear for 2006.
NITS allows a transmission customer
to integrate, plan, economically
dispatch, and regulate its network
resources to serve its native load in a
way comparable to how a transmission
provider uses its own transmission
system to service its native load
customers. The monthly charge
methodology for NITS on the CAP 115–
kV and 230–kV transmission lines is the
product of the transmission customer’s
load-ratio share times one-twelfth of the
annual transmission revenue
requirement. The customer’s load-ratio
share is calculated on a rolling 12month basis. The customer’s load-ratio
share is equal to that customer’s hourly
load coincident with the CAP 115–kV
and 230–kV transmission lines monthly
transmission system peak divided by
the resultant value of the CAP 115–kV
and 230–kV transmission lines monthly
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transmission system peak minus the
CAP 115–kV and 230–kV transmission
lines coincident peak for all firm pointto-point transmission service plus the
CAP 115–kV and 230–kV transmission
lines firm point-to-point transmission
service reservations.
By Delegation Order No. 00–037.00,
effective December 6, 2001, the
Secretary of Energy delegated: (1) The
authority to develop power and
transmission rates to Western’s
Administrator, (2) the authority to
confirm, approve, and place such rates
into effect on an interim basis to the
Deputy Secretary of Energy, and (3) the
authority to confirm, approve, and place
into effect on a final basis, to remand or
to disapprove such rates to the
Commission. Existing DOE procedures
for public participation in power rate
adjustments (10 CFR part 903) were
published on September 18, 1985.
Under Delegation Order Nos. 00–
037.00 and 00–001.00B, and in
compliance with 10 CFR part 903, and
18 CFR part 300, I hereby confirm,
approve, and place Rate Order No.
WAPA–124, the proposed formula rate
for CAP transmission, into effect on an
interim basis. The new Rate Schedules
CAP–FT2, CAP–NFT2, and CAP–NITS2,
will be promptly submitted to the
Commission for confirmation and
approval on a final basis.
Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.
DEPARTMENT OF ENERGY
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Deputy Secretary
[Rate Order No. WAPA–124]
In the Matter of: Western Area Power
Administration Rate Adjustment for the
Central Arizona Project. Order Confirming,
Approving, and Placing the Central Arizona
Project Transmission Service Rates Into
Effect on an Interim Basis
This rate was established in accordance
with section 302 of the Department of Energy
(DOE) Organization Act (42 U.S.C. 7152).
This Act transferred to and vested in the
Secretary of Energy the power marketing
functions of the Secretary of the Department
of the Interior and the Bureau of Reclamation
under the Reclamation Act of 1902 (ch. 1093,
32 Stat. 388), as amended and supplemented
by subsequent laws, particularly section 9(c)
of the Reclamation Project Act of 1939 (43
U.S.C. 485h(c)), and other Acts that
specifically apply to the project involved.
By Delegation Order No. 00–037.00,
effective December 6, 2001, the Secretary of
Energy delegated: (1) The authority to
develop power and transmission rates to
Western’s Administrator, (2) the authority to
confirm, approve, and place such rates into
effect on an interim basis to the Deputy
Secretary of Energy, and (3) the authority to
confirm, approve, and place into effect on a
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final basis, to remand or to disapprove such
rates to the Commission. Existing DOE
procedures for public participation in power
rate adjustments (10 CFR part 903) were
published on September 18, 1985.
Acronyms and Definitions
As used in this rate order, the following
acronyms and definitions apply:
Administrator: The Administrator of the
Western Area Power Administration
(Western).
BATO: Balancing Authority and
Transmission Operations area. Formerly
referred to as a Control Area.
Capacity: The electric capability of a
generator, transformer, transmission circuit,
or other equipment. It is expressed in kW.
CAP: Central Arizona Project, one of three
related water development projects that make
up the Colorado River Basin Project.
Commission: Federal Energy Regulatory
Commission.
CROD: Contract rate of delivery. The
maximum amount of capacity made available
to a customer for a period specified under a
contract or service agreement.
Customer: An entity with a contract [BF8]
or service agreement that is receiving service
from Western’s Desert Southwest Region.
CY: Calendar year; January 1 through
December 31.
DOE: United States Department of Energy.
DOE Order RA 6120.2: An order dealing
with power marketing administration
financial reporting and ratemaking
procedures.
Energy: Measured in terms of the work it
is capable of doing over a period of time. It
is expressed in kilowatthours.
FERC: The Commission (to be used when
referencing Commission Orders).
Firm: A type of product and/or service
available at the time requested by the
customer.
Formula Rates: A rate which is based upon
a formula calculated yearly.
FY: Fiscal year; October 1 to September 30.
kV: Kilovolt—the electrical unit of measure
of electric potential that equals 1,000 volts.
kW: Kilowatt—the electrical unit of
capacity that equals 1,000 watts.
kWmonth: Kilowattmonth—the electrical
unit of the monthly amount of capacity.
kWh: Kilowatthour—the electrical unit of
energy that equals 1,000 watts in 1 hour.
mill: A monetary denomination of the
United States that equals one tenth of a cent
or one thousandth of a dollar.
NEPA: National Environmental Policy Act
of 1969 (42 U.S.C. 4321, et seq.).
NITS: Network Integration Transmission
Service.
Non-firm: A type of product and/or service
not always available at the time requested by
the customer.
O&M: Operation and Maintenance.
Power: Capacity and energy.
Reclamation: United States Department of
the Interior, Bureau of Reclamation.
Revenue Requirement: The revenue
required to recover annual expenses (such as
O&M, transmission service expenses,
interest, deferred expenses) and repayment of
Federal investments, and other assigned
costs.
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SCADA: Supervisory Control and Data
Acquisition.
WALC: Western Area Lower Colorado
BATO, operated by Desert Southwest Region.
Western: United States Department of
Energy, Western Area Power Administration.
Effective Date
The new interim rates will take effect on
the first day of the first full billing period
beginning on or after January 1, 2006, and
will remain in effect until December 31,
2010, pending approval by the Commission
on a final basis.
Public Notice and Comment
Western followed the Procedures for Public
Participation in Power and Transmission
Rate Adjustments and Extensions, 10 CFR
part 903, in developing these rates. The steps
Western took to involve interested parties in
the rate process were:
1. On June 22, 2005, Western mailed a
notice announcing an informal meeting,
which was held July 12, 2005. At this
informal meeting, Western explained the
rationale for the rate adjustment, presented
rate designs and methodologies, and
answered questions.
2. A Federal Register notice published on
July 1, 2005 (70 FR 38130), announced the
proposed rates for the Central Arizona
Project, began a public consultation and
comment period, and announced the public
information and public comment forums.
3. On July 18, 2005, Western’s Desert
Southwest Region mailed letters to all the
Central Arizona Project customers and
interested parties transmitting the Brochure
for Proposed Rates and the Federal Register
notice published on July 1, 2005.
4. On July 21, 2005, Western mailed data
to the Central Arizona Project customers and
interested parties, in response to customers’
data request at the informal customer
meeting.
5. On July 22, 2005, beginning at 10 a.m.,
Western held a public information forum at
the Desert Southwest Regional office in
Phoenix, Arizona. Western provided detailed
explanations of the proposed rates for CAP,
and a list of issues that could affect the
proposed rates. Western also answered
questions, provided rate brochures,
supporting documentation, and
informational handouts.
6. On August 22, 2005, beginning at 1 p.m.,
Western held a comment forum to give the
public an opportunity to comment for the
record. There were no comments at this
forum.
7. Western received one comment letter
during the consultation and comment period,
which ended September 29, 2005. All
formally submitted comments have been
considered in preparing this Rate Order.
Comments
Written comments were received from the
following organizations: Central Arizona
Water Conservation District.
Project Description
The CAP was authorized by passage of the
Colorado River Basin Project Act (Act of
September 30, 1968, Pub. L. 90–537, 82 Stat.
885) for the purposes of furnishing irrigation
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water and municipal water supplies to the
water-deficient areas of Arizona and western
New Mexico through direct diversion or
exchange of water, conservation and
development of fish and wildlife resources,
enhancement of recreation opportunities, and
for other purposes.
The Secretary of the Interior was directed
to construct, operate and maintain the CAP,
consisting of the following principal works:
(1) A system of main conduits and canals,
including a main canal and pumping plants
for diverting and carrying water; (2) water
storage facilities and power-pumping plants;
(3) aqueducts and pumping plants; (4) related
canals, regulating facilities, hydroelectric
power plants, and electrical transmission
facilities required for the operation of said
principal works; (5) related water
distribution and drainage works; and (6)
appurtenant works.
The Colorado River Basin Project Act also
authorized Federal participation with nonFederal interests for construction, operation,
and maintenance of a thermal generating
power plant (Navajo Generating Station or
NGS) whereby the United States acquired the
rights to plant capacity, including the
delivery of power and energy over
appurtenant transmission facilities to
mutually agreed upon delivery points, as the
Secretary of the Interior determines is
required to provide pumping power for the
CAP.
When not required for the CAP, the NGS
power and energy may be disposed of by the
Secretary of the Interior for other purposes at
such prices the Secretary determines,
including its marketing in conjunction with
the sale of power and energy from Federal
power plants in the Colorado River system,
so as to produce the greatest practicable
amount of power and energy that can be sold
at firm power and energy rates.
On August 4, 1977, the Department of
Energy Organization Act (Pub. L. 95–91, 91
Stat. 565; 42 U.S.C. 7101) was signed into
law, establishing the DOE. Section 302(a)(3)
of the Act created Western within DOE.
Section 302(a)(1)(E) transferred the power
marketing functions of the Bureau of
Reclamation, including the construction,
1535
operation, and maintenance of transmission
lines and attendant facilities to the DOE.
Transmission Rate Methodology Study
Western prepared a transmission rate
methodology study to ensure that
transmission service rates are adequate to
recover the costs associated with providing
transmission service on the CAP 115/230-kV
transmission system. The design includes all
transmission expenses and associated
offsetting revenues.
Western reviews the CAP rate design each
year to determine if revenues will be
sufficient to repay, within the required time,
all costs assigned to the Central Arizona
Project revenues. Repayment criteria are
based on law, policies including DOE Order
RA 6120.2, and authorizing legislation.
The revised firm transmission rate for CAP
firm transmission reflects an overall rate
decrease of approximately 2.87 percent for
2006 when compared to the existing CAP
firm transmission rate in Rate Schedule CAPFT1.
COMPARISON OF CURRENT AND PROVISIONAL FIRM TRANSMISSION RATE
Type of service
Existing rates 115/230-kV system
Proposed formula rates 115/230-kV
system 1/1/2006
Firm Transmission Service ....................
Nonfirm Transmission Service ...............
$9.83/kW/year .......................................
1.12 mills/kWh .......................................
$9.55/kW/year .......................................
1.09 mills/kWh .......................................
Firm Point-to-Point
Western seeks approval of the rate design
formula to calculate the transmission rate to
be applied annually. Using this formula, the
provisional rate for firm CAP transmission
service is $9.55 per kW-year for 2006, a 2.87percent decrease from the existing
transmission rate of $9.83 per kW-year,
which became effective January 1, 2001. The
decrease is due to transmission capacity
reservations increasing more rapidly than
increases in total annual costs. The rate
formula is calculated annually, using the
most recent 5-year projections of total
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expenses and revenues. If needed, a revised
rate will become effective each January 1.
The proposed rate formula would be effective
January 1, 2006, through December 31, 2010.
The cost/kW-year is calculated using the
following two-step formula:
(1) ARR − TRC=NARR
NARR
(2)
TSTL
Where:
ARR = Annual Revenue Requirement. The
costs associated with facilities that
support the transfer capability of the
CAP transmission system, excluding
generation facilities. These costs include
investment costs, interest expense,
administrative and general expenses, and
operation and maintenance expense. The
revenue requirement for CAP is based on
projected average costs for the upcoming
5-year rate-setting period.
TRC = Transmission Revenue Credits. The
revenues generated by the CAP
transmission system not related to the
revenues from the sale of long-term firm
transmission.
NARR = Net Annual Transmission Revenue
Requirement. The Annual Revenue
Requirement minus Transmission
Revenue Credits.
TSTL = CAP Transmission System Total
Load. The sum of the total average CAP
transmission capacity under long-term
reservation, including the total network
integration loads at system peak for the
upcoming 5-year rate-setting period.
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(2.87%)
(2.87%)
Nonfirm Point-to-Point
The proposed rate for nonfirm point-topoint CAP transmission service is a mills/
kWh rate, based upon the current firm pointto-point rate and may be discounted. This
rate will remain in effect for the same period
as the firm point-to-point rate and will also
be reviewed annually. The provisional rate
for CAP non-firm transmission service is
based on the current CAP firm point-to-point
transmission rate. The provisional rate is
expressed in mills/kWh and is a maximum
of 1.09 mills/kWh for 2006. Transmission
availability will be posted on Western’s
OASIS.
Network Integration Transmission Service
The proposed rate for network
transmission is a formula calculation based
upon the annual transmission revenue
requirement. There are no changes to the
existing network integration transmission
service formula under Rate Schedule CAP–
NITS2.
NITS allows a transmission customer to
integrate, plan, economically dispatch, and
regulate its network resources to serve its
native load in a way comparable to how a
transmission provider uses its own
transmission system to service its native load
customers. The monthly charge methodology
for NITS on the CAP 115-kV and 230-kV
transmission lines is the product of the
transmission customer’s load-ratio share
times one-twelfth of the annual transmission
revenue requirement. The customer’s loadratio share is calculated on a rolling 12month basis. The customer’s load-ratio share
is equal to that customer’s hourly load
coincident with the CAP 115-kV and 230-kV
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Western’s revised rate formula will be used
to calculate rates annually for all current and
future CAP transmission service. The current
CAP transmission rate formula became
effective on January 1, 2001. The current CAP
rate under WAPA Rate Order No. 88 will
expire December 31, 2005. The revised
transmission rate formula is expected to be
effective January 1, 2006, through December
31, 2010. These rate formulas include costs
for scheduling, system control, and dispatch
service.
The methodology is an annual formula that
will divide the average annual transmission
revenue requirement by the average annual
transmission reservations to determine the
rate for firm point-to-point transmission
service. The annual transmission revenue
requirement includes O&M expenses,
administrative and general expenses,
investment costs, and interest expense. This
revenue requirement is offset by any CAP
transmission system revenue credits, such as
revenue from non-firm or short-term sales, to
determine the net revenue requirement.
Percent change
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Federal Register / Vol. 71, No. 6 / Tuesday, January 10, 2006 / Notices
transmission lines monthly transmission
system peak divided by the resultant value of
the CAP 115-kV and 230-kV transmission
lines monthly transmission system peak
minus the CAP 115-kV and 230-kV
transmission lines coincident peak for all
firm point-to-point transmission service plus
the CAP 115-kV and 230-kV transmission
lines firm point-to-point transmission service
reservations.
The proposed revenue requirement
includes the costs for scheduling, system
control, and dispatch service. The reactive
supply and voltage control ancillary service
must be purchased from the WALC BATO.
The transmission customer may self-supply
the four remaining ancillary services or
request them from WALC. These four
ancillary services are regulation and
frequency response service, energy imbalance
service, spinning reserve service, and
supplemental reserve service. The rates for
these ancillary services are set forth in Rate
Schedules DSW–SD1, DSW–RS1, DSW–EI1,
DSW–FR1, DSW–SPR1, and DSW–SUR1.
Western is currently engaged in a public
process to implement new Rates Schedules
for ancillary services, which are expected to
be effective April 1, 2006.
Certification of Rates
Western’s Administrator certified that the
provisional rates for CAP transmission
service are the lowest possible rates
consistent with sound business principles.
The provisional rates were developed
following administrative policies and
applicable laws.
Basis for Rate Development
According to Reclamation Law, Western
must establish transmission rates sufficient to
recover operation, maintenance, purchased
power and interest expenses, and repayment
of investment.
The existing rate for CAP firm transmission
under Rate Schedule CAP–FT1 expires
December 31, 2005. Effective January 1, 2006,
Rate Schedule CAP–FT1 will be superseded
by the new rates in Rate Schedule CAP–FT2.
The provisional rate for CAP firm point-topoint transmission is $9.55 per kW per year.
Statement of Revenue and Related Expenses
The following table provides a summary of
projected revenue and expense data for the
CAP firm transmission rate through the 5year provisional rate approval period.
CAP FIRM TRANSMISSION.—COMPARISON OF 5-YEAR RATE PERIOD (FY 2006–FY 2010)
[Total revenues and expenses]
Existing formula
rate
Proposed formula
rate
Difference
Total Revenues ........................................................................................................
Revenue Distribution
Expenses:
O&M (including replacements expense) ..........................................................
Purchased Power and Wheeling ......................................................................
Interest ..............................................................................................................
Other .................................................................................................................
$34,429,675
$40,103,745
$5,674,070
6,417,770
0
19,343,148
345,140
10,864,596
0
17,931,221
1,813,043
4,446,826
0
(1,411,927)
1,467,903
Total Expenses ..........................................................................................
26,106,058
30,608,860
4,502,802
Principal Payments:
Original Project and Additions ..........................................................................
Replacements ...................................................................................................
8,323,302
0
9,484,969
0
1,161,667
0
Total Principal Payments ..........................................................................
8,323,302
9,484,969
1,161,667
Total Revenue Distribution ........................................................................
34,429,360
40,093,829
5,664,469
The cost data reflects an increase in total
costs when comparing the existing rates to
the proposed rates. The increases in total
costs, however, are outpaced by increases in
total transmission reservations, resulting in a
proposed rate decrease of 2.87 percent
effective January 1, 2006.
Comments
The comments and responses regarding the
firm transmission rate, paraphrased for
brevity when not affecting the meaning of the
statement(s), are discussed below. Direct
quotes from comment letters are used for
clarification where necessary. The rate
process issues discussed are, (1) Central
Arizona Water Conservation District
(CAWCD) O&M costs, (2) Western expenses
to the CAP transmission system, and (3)
capital additions and replacements.
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1. CAWCD O&M Costs
Comment: The CAWCD representative
strongly supports including the costs
identified during the public process.
However, there are other CAP transmission
system O&M costs incurred by CAWCD, in
addition to the McCullough O&M charge,
which are not reflected in Western’s rate
review.
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Response: Western has committed to
continue to work with CAWCD to ensure that
costs appropriately attributed to the CAP
115/230-kV transmission system will be
included in the rate calculation. O&M
expenses incurred by CAWCD to aid in
maintaining the Federal transmission system
are appropriately included in the
transmission rate. Costs will be reviewed
annually as part of the annual review to
determine adequacy of the transmission rate.
2. Western Expenses to the CAP
Transmission System
Comment: The CAWCD representative
indicated the CAP transmission line miles
and SCADA point values that are used to
allocate costs for transmission system studies
(‘‘STUDM’’ costs) and costs for assets
providing benefit to multiple power systems
(‘‘RENTM’’ costs), respectively, are too high
and should be adjusted.
Response: Western has responded to
CAWCD’s review of the allocation practices
and stated that adjustments will be made
where appropriate in FY 2006. Any resulting
increase or decrease in the revenue
requirement which results in an over or
under collection will be accounted for in the
subsequent year.
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3. Capital Additions and Replacements in
Rate
Comment: The CAWCD representative
indicated that Western’s July 2005 rate
adjustment brochure states that no capital
additions or replacements are projected for
FY 2006 through FY 2010. The customer
believes the brochure statement to be untrue,
and anticipates annual costs for capital
additions or replacements in FY 2007 and
beyond to average at least $500,000. Those
costs should be included in the CAP
transmission rate methodology. CAWCD
encourages Western to modify the proposed
CAP transmission rate to be charged for CY
2006 to include projections for new capital
investments.
Response: Western is working with
CAWCD and the Bureau of Reclamation to
ensure appropriate amortization costs for
capitalized replacements or additions are
included in the rate calculation. Based on
reviews of available data, Western has
included an estimate of $625,000 in
replacements for the rate to be charged in CY
2006. In the event capitalized replacements
or additions are added to plant-in-service in
a given year, and the amortization costs
(principal and interest) were not included in
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Federal Register / Vol. 71, No. 6 / Tuesday, January 10, 2006 / Notices
the rate calculation, they will be included in
the subsequent year.
Availability of Information
Information about this rate adjustment,
including power repayment studies,
comments, letters, memorandums, and other
supporting material made or kept by Western
to develop the provisional rates, is available
for public review in the Desert Southwest
Customer Service Region, Western Area
Power Administration, 615 South 43rd
Avenue, Phoenix, Arizona.
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. Western has determined that 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 NEPA of 1969 (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 that 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.
wwhite on PROD1PC65 with NOTICES
Submission to the Federal Energy Regulatory
Commission
The interim rates herein confirmed,
approved, and placed into effect, together
with supporting documents, will be
submitted to the Commission for
confirmation and final approval.
Order
In view of the foregoing and under the
authority delegated to me, I confirm and
approve on an interim basis, effective January
1, 2006, Rate Schedules CAP–FT2, CAP–
NFT2, and CAP–NITS2 for the Central
Arizona Project of the Western Area Power
Administration. The rate schedules shall
remain in effect on an interim basis, pending
the Commission’s confirmation and approval
of them or substitute rates on a final basis
through December 31, 2010.
VerDate Aug<31>2005
16:09 Jan 09, 2006
Jkt 208001
Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.
Rate Schedule CAP–FT2
Supersedes Rate Schedule CAP–FT1
United States Department of Energy Western
Area Power Administration
Central Arizona Project
Schedule of Rate(s) for Firm Point-to-Point
CAP 115-kv/230-kv Transmission Service
Effective: The first day of the first full
billing period beginning on or after January
1, 2006, through December 31, 2010.
Available: In the area served by the Central
Arizona Project (CAP) 115-kV/230-kV
transmission system.
Applicable: The transmission service
customers shall compensate the CAP where
firm capacity and energy are supplied to the
CAP 115-kV/230-kV transmission system at
points of interconnection with other systems
and transmitted and delivered, less losses, to
points of delivery on the CAP 115-kV/230-kV
system specified in the contract or service
agreement. The formula for the annual
revenue requirement used to calculate the
charges for this firm service under this
schedule was promulgated and may be
modified pursuant to applicable Federal
laws, regulations, and policies.
The Desert Southwest Region may modify
the charges for firm point-to-point
transmission service upon written notice to
the transmission customer. Any change to the
charges to the transmission customer for firm
point-to-point transmission, shall be as set
forth in a revision to this rate schedule
promulgated pursuant to applicable Federal
laws, regulations, and policies and made part
of the applicable service contract or service
agreement. DSW shall charge the
transmission customer in accordance with
the revenue requirements then in effect.
Character and Conditions of Service:
Alternating current at 60 Hertz, three-phase,
delivered and metered at the voltages and
points of delivery established by contract or
service agreement over the CAP 115-kV/230kV transmission system.
Formula Rate for Firm Point-to-Point
Transmission Service
Annual Rate = 5-Year Average Annual
Revenue Requirement divided by the 5Year Average Contract Rate of Delivery,
rounded to the nearest penny.
Monthly Rate = Annual Rate divided by 12,
rounded to the nearest penny.
Calculated Rates
For 2006, the annual firm rate calculates to
$9.55 per kW year, and the monthly firm rate
calculates to $0.80 per kW month. Based on
updated financial and load data, recalculated
rates will go into effect on January 1 of each
year during the effective rate schedule
period.
Adjustments
For Reactive Power: There shall be no
entitlement to transfer of reactive kilovolt
amperes at delivery points, except when such
transfers may be mutually agreed upon by
PO 00000
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Fmt 4703
Sfmt 4703
1537
contractor and contracting officer or their
authorized representatives.
For Losses: Capacity and energy losses
incurred in connection with the transmission
and delivery of capacity and energy under
this rate schedule shall be supplied by the
customer in accordance with the contract or
service agreement.
Billing for Unauthorized Overruns: For
each billing period in which there is a
contract violation involving an unauthorized
overrun of the contractual firm transmission
obligations, such overrun shall be billed at 10
times the above rates.
Rate Schedule CAP–NFT2
Supersede Rate Schedule CAP–NFT1
United States Department of Energy Western
Area Power Administration
Central Arizona Project
Schedule of Rate(s) for Nonfirm Point-toPoint CAP 115-kV/230-kV Transmission
Service
Effective: The first day of the first full
billing period beginning on or after January
1, 2006, through December 31, 2010.
Available: In the marketing area served by
the Central Arizona Project 115-kV/230-kV
transmission system.
Applicable: The transmission service
customer shall compensate the Central
Arizona Project (CAP) for nonfirm point-topoint transmission service where capacity
and energy are supplied to the CAP 115-kV/
230-kV transmission system at points of
interconnection with other systems,
transmitted subject to the availability of the
transmission capacity, and delivered less
losses, to points of delivery on the CAP 115kV/230-kV system specified in the contract or
service agreement.
Character and Conditions of Service:
Alternating current at 60 Hertz, three-phase,
delivered and metered at the voltages and
points of delivery established by contract or
service agreement over the CAP 115-kV/230kV transmission system.
Formula Rate for Nonfirm Point-to-Point
Transmission Service
Nonfirm Point-To-Point Transmission
Service Rate: Each Contractor shall be billed
monthly a mills per kilowatthour rate of
scheduled or delivered kilowatthours at
point of delivery, established by contract,
payable monthly. This rate is equal to the
CAP 115-kV/230-kV Firm Transmission
dollar per kilowattyear rate then in effect
divided by 8760, multiplied by 1,000,
rounded to two decimal places.
Calculated Rate
For 2006, the nonfirm rate calculates to
1.09 mills/kWh. Based on updated financial
and load data, a recalculated rate will go into
effect on January 1 of each year during the
effective rate schedule period.
Adjustments
For Reactive Power: There shall be no
entitlement to transfer of reactive kilovolt
amperes at delivery points, except when such
transfers may be mutually agreed upon by
contractor and contracting officer or their
authorized representatives.
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10JAN1
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Federal Register / Vol. 71, No. 6 / Tuesday, January 10, 2006 / Notices
For Losses: Capacity and energy losses
incurred in connection with the transmission
and delivery of capacity and energy under
this rate schedule shall be supplied by the
customer in accordance with the contract or
service agreement.
Rate Schedule CAP–NITS2
Supersedes Rate Schedule CAP–NITS1
United States Department of Energy Western
Area Power Administration
Central Arizona Project
Schedule of Rate(s) for Network Integration
Transmission Service
Effective: The first day of the first full
billing period beginning on or after January
1, 2006, through December 31, 2010.
Applicable: The transmission customer
shall compensate the CAP each month for
Network Integration Transmission Service
(NITS) pursuant to the applicable Network
Integration Transmission Service Agreement
and annual revenue requirement referred to
below. The formula for the annual revenue
requirement used to calculate the charges for
this service under this schedule was
promulgated and may be modified pursuant
to applicable Federal laws, regulations, and
policies.
The Desert Southwest Region (DSW) may
modify the charges for NITS upon written
notice to the transmission customer. DSW
shall charge the transmission customer in
accordance with the revenue requirement
then in effect.
Formula Rate
Monthly Charge = Transmission Customer’s
Load-Ratio Share × (Revenue
Requirement/12)
Calculated Rate
The NITS rate is calculated using a
projected annual revenue requirement. Based
on updated financial and load data, a
recalculated revenue requirement will go into
effect on January 1 of each year during the
effective rate schedule period.
[FR Doc. E6–110 Filed 1–9–06; 8:45 am]
BILLING CODE 6450–01–P
ENVIRONMENTAL PROTECTION
AGENCY
[FRL–8020–5]
National Advisory Council for
Environmental Policy and Technology
Environmental Technology
Subcommittee
Environmental Protection
Agency (EPA).
ACTION: Notice of meeting.
wwhite on PROD1PC65 with NOTICES
AGENCY:
SUMMARY: Under the Federal Advisory
Committee Act, Public Law 92463, EPA
gives notice of a meeting of the
Environmental Technology
Subcommittee of the National Advisory
Council for Environmental Policy and
Technology (NACEPT). NACEPT
VerDate Aug<31>2005
16:09 Jan 09, 2006
Jkt 208001
provides advice and recommendations
to the Administrator of EPA on a broad
range of environmental policy,
technology, and management issues.
The Environmental Technology
Subcommittee was formed to assist EPA
in evaluating its current and potential
role in the development and
commercialization of environmental
technologies by suggesting how to
optimize existing EPA programs to
facilitate the development of sustainable
private sector technologies, and by
suggesting alternative approaches to
achieving these goals. The purpose of
the meeting is to discuss the
Subcommittee’s recommendations on
these issues. The Subcommittee will
also discuss new issues that it may
address in the future. A copy of the
agenda for the meeting will be posted at
https://www.epa.gov/ocem/nacept/calnacept.htm.
DATES: The NACEPT Environmental
Technology Subcommittee will hold a
two day open meeting on Thursday,
January 19, from 9 a.m. to 5 p.m. and
Friday, January 20, from 8:30 a.m. to
1:30 p.m. Due to extenuating
circumstances, contractual
arrangements of the meeting space were
delayed.
ADDRESSES: The meeting will be held at
the Madison Hotel, 1177 15th Street,
NW., Washington, DC 20005. The
meeting is open to the public, with
limited seating on a first-come, firstserved basis.
FOR FURTHER INFORMATION CONTACT:
Mark Joyce, Designated Federal Officer,
joyce.mark@epa.gov, 202–233–0068,
U.S. EPA, Office of Cooperative
Environmental Management (1601E),
1200 Pennsylvania Avenue, NW.,
Washington, DC 20460.
SUPPLEMENTARY INFORMATION: Requests
to make oral comments or provide
written comments to the Subcommittee
should be sent to Mark Joyce,
Designated Federal Officer, at the
contact information above. The public is
welcome to attend all portions of the
meeting.
Meeting Access: For information on
access or services for individuals with
disabilities, please contact Mark Joyce at
202–233–0068 or joyce.mark@epa.gov.
To request accommodation of a
disability, please contact Mark Joyce,
preferably at least 10 days prior to the
meeting, to give EPA as much time as
possible to process your request.
Dated: January 4, 2006.
Sonia Altieri,
Designated Federal Officer.
[FR Doc. E6–98 Filed 1–9–06; 8:45 am]
BILLING CODE 6560–50–P
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ENVIRONMENTAL PROTECTION
AGENCY
[EPA–HQ–OPPT–2003–0006; FRL–7746–6]
TSCA Chemical Testing; Receipt of
Test Data
Environmental Protection
Agency (EPA).
ACTION: Notice.
AGENCY:
SUMMARY: This notice announces EPA’s
receipt of test data regarding In Vitro
Dermal Absorption Rate Testing of
Certain Chemicals of Interest to the
Occupational Safety and Health
Administration. Data were received on
the following chemicals: Biphenyl (CAS
No. 92-52-4); tert-butylcatechol (TBC)
(CAS No. 98-29-3); carbon disulfide
(CAS No. 75-15-0); catechol (CAS No.
120-80-9); chlorobenzene (CAS No. 10890-7); cyclohexanol (CAS No. 108-93-0);
p-dichlorobenzene (CAS No. 106-46-7);
dimethylacetamide (DMAc) (CAS No.
127-19-5); ethylene dichloride (CAS No.
107-06-2); hydroquinone monomethyl
ether (HQMME) (CAS No. 150-76-5);
methyl formate (CAS No. 107-31-3);
vinyl toluene (CAS No. 25013-15-4); and
p-xylene (CAS No. 106-42-3). These data
were submitted pursuant to a test rule
issued by EPA under section 4 of the
Toxic Substances Control Act (TSCA).
FOR FURTHER INFORMATION CONTACT:
Colby Lintner, Regulatory Coordinator,
Environmental Assistance Division
(7408M), Office of Pollution Prevention
and Toxics, Environmental Protection
Agency, 1200 Pennsylvania Ave., NW.,
Washington, DC 20460–0001; telephone
number: (202) 554–1404; e-mail address:
TSCA-Hotline@epa.gov.
SUPPLEMENTARY INFORMATION:
I. General Information
A. Does this Action Apply to Me?
This action is directed to the public
in general. This action may, however, be
of interest to those persons who are
concerned about data on health and/or
environmental effects and other
characteristics of this chemical. Since
other entities may also be interested, the
Agency has not attempted to describe all
the specific entities that may be affected
by this action. If you have any questions
regarding the applicability of this action
to a particular entity, consult the person
listed under FOR FURTHER INFORMATION
CONTACT.
B. How Can I Get Copies of this
Document and Other Related
Information?
1. Docket. EPA has established an
official public docket for this action
under docket identification (ID) number
E:\FR\FM\10JAN1.SGM
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]]>Agencies
[Federal Register Volume 71, Number 6 (Tuesday, January 10, 2006)]
[Notices]
[Pages 1533-1538]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-110]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Western Area Power Administration
Central Arizona Project--Rate Order No. WAPA-124
AGENCY: Western Area Power Administration, DOE.
ACTION: Notice of order concerning transmission service rates.
-----------------------------------------------------------------------
SUMMARY: The Deputy Secretary of Energy confirmed and approved Rate
Order No. WAPA-124 and Rate Schedules CAP-FT2, CAP-NFT2, and CAP-NITS2,
placing transmission rates from the Central Arizona Project (CAP) 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 repayment of
power investment, within the allowable periods.
DATES: Rate Schedules CAP-FT2, CAP-NFT2, and CAP-NITS2 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 through December 31, 2010, or
until the rate schedules are superseded.
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, (602) 605-7348,
e-mail carlson@wapa.gov, or Mr. Jack D. Murray, Rates Team Lead, Desert
Southwest Customer Service Region, Western Area Power Administration,
P.O. Box 6457, Phoenix, AZ 85005-6457, (602) 605-2442, e-mail
jmurray@wapa.gov.
SUPPLEMENTARY INFORMATION: The Deputy Secretary of Energy approved Rate
Schedules CAP-FT1, CAP-NFT1, and CAP-NITS1 for transmission service on
December 11, 2000 (Rate Order No. WAPA-88, 65 FR 77368, December 11,
2000). The Commission confirmed and approved the rate schedules on July
31, 2001, in FERC Docket No. EF01-5111-000. The existing rate schedules
CAP-FT1, CAP-NFT1, and CAP-NITS1 are effective from January 1, 2001,
through December 31, 2005.
The existing rate schedules are being superseded by rate schedules
CAP-FT2, CAP-NFT2, and CAP-NITS2. The provisional formula rates for
point-to-point transmission service and Network Integration
Transmission Service (NITS) on the CAP 115kV and 230-kV transmission
lines are based on the calculation of a revenue requirement that
recovers the CAP 115kV and 230-kV transmission lines costs for
facilities associated with providing transmission service and the non-
facilities costs allocated to transmission service. These rate formulas
include costs for scheduling, system control, and dispatch service. The
provisional rates for point-to-point transmission service on the CAP
115-kV/230-kV transmission system are determined by combining the
average annual amortization costs with the average annual operations
and maintenance costs, and dividing them by the average annual contract
rate of delivery for the 5-year period FY 2006-FY 2010.
The revised formula rates reflect a 2.87-percent decrease for 2006
when compared to the existing CAP transmission rates, which expire
December 31, 2005. The decrease in the firm point-to-point rate is the
result of increased transmission reservations combined with relatively
stable expenses since the approval of Rate Order WAPA-88.
Implementation of the revised formula rates will result in a firm
transmission service rate of $9.55 per kilowattyear for 2006.
NITS allows a transmission customer to integrate, plan,
economically dispatch, and regulate its network resources to serve its
native load in a way comparable to how a transmission provider uses its
own transmission system to service its native load customers. The
monthly charge methodology for NITS on the CAP 115-kV and 230-kV
transmission lines is the product of the transmission customer's load-
ratio share times one-twelfth of the annual transmission revenue
requirement. The customer's load-ratio share is calculated on a rolling
12-month basis. The customer's load-ratio share is equal to that
customer's hourly load coincident with the CAP 115-kV and 230-kV
transmission lines monthly transmission system peak divided by the
resultant value of the CAP 115-kV and 230-kV transmission lines monthly
[[Page 1534]]
transmission system peak minus the CAP 115-kV and 230-kV transmission
lines coincident peak for all firm point-to-point transmission service
plus the CAP 115-kV and 230-kV transmission lines firm point-to-point
transmission service reservations.
By Delegation Order No. 00-037.00, effective December 6, 2001, the
Secretary of Energy delegated: (1) The authority to develop power and
transmission rates to Western's Administrator, (2) the authority to
confirm, approve, and place such rates into effect on an interim basis
to the Deputy Secretary of Energy, and (3) the authority to confirm,
approve, and place into effect on a final basis, to remand or to
disapprove such rates to the Commission. Existing DOE procedures for
public participation in power rate adjustments (10 CFR part 903) were
published on September 18, 1985.
Under Delegation Order Nos. 00-037.00 and 00-001.00B, and in
compliance with 10 CFR part 903, and 18 CFR part 300, I hereby confirm,
approve, and place Rate Order No. WAPA-124, the proposed formula rate
for CAP transmission, into effect on an interim basis. The new Rate
Schedules CAP-FT2, CAP-NFT2, and CAP-NITS2, will be promptly submitted
to the Commission for confirmation and approval on a final basis.
Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.
DEPARTMENT OF ENERGY
Deputy Secretary
[Rate Order No. WAPA-124]
In the Matter of: Western Area Power Administration Rate Adjustment for
the Central Arizona Project. Order Confirming, Approving, and Placing
the Central Arizona Project Transmission Service Rates Into Effect on
an Interim Basis
This rate was established in accordance with section 302 of the
Department of Energy (DOE) Organization Act (42 U.S.C. 7152). This
Act transferred to and vested in the Secretary of Energy the power
marketing functions of the Secretary of the Department of the
Interior and the Bureau of Reclamation under the Reclamation Act of
1902 (ch. 1093, 32 Stat. 388), as amended and supplemented by
subsequent laws, particularly section 9(c) of the Reclamation
Project Act of 1939 (43 U.S.C. 485h(c)), and other Acts that
specifically apply to the project involved.
By Delegation Order No. 00-037.00, effective December 6, 2001,
the Secretary of Energy delegated: (1) The authority to develop
power and transmission rates to Western's Administrator, (2) the
authority to confirm, approve, and place such rates into effect on
an interim basis to the Deputy Secretary of Energy, and (3) the
authority to confirm, approve, and place into effect on a final
basis, to remand or to disapprove such rates to the Commission.
Existing DOE procedures for public participation in power rate
adjustments (10 CFR part 903) were published on September 18, 1985.
Acronyms and Definitions
As used in this rate order, the following acronyms and
definitions apply:
Administrator: The Administrator of the Western Area Power
Administration (Western).
BATO: Balancing Authority and Transmission Operations area.
Formerly referred to as a Control Area.
Capacity: The electric capability of a generator, transformer,
transmission circuit, or other equipment. It is expressed in kW.
CAP: Central Arizona Project, one of three related water
development projects that make up the Colorado River Basin Project.
Commission: Federal Energy Regulatory Commission.
CROD: Contract rate of delivery. The maximum amount of capacity
made available to a customer for a period specified under a contract
or service agreement.
Customer: An entity with a contract [BF8] or service agreement
that is receiving service from Western's Desert Southwest Region.
CY: Calendar year; January 1 through December 31.
DOE: United States Department of Energy.
DOE Order RA 6120.2: An order dealing with power marketing
administration financial reporting and ratemaking procedures.
Energy: Measured in terms of the work it is capable of doing
over a period of time. It is expressed in kilowatthours.
FERC: The Commission (to be used when referencing Commission
Orders).
Firm: A type of product and/or service available at the time
requested by the customer.
Formula Rates: A rate which is based upon a formula calculated
yearly.
FY: Fiscal year; October 1 to September 30.
kV: Kilovolt--the electrical unit of measure of electric
potential that equals 1,000 volts.
kW: Kilowatt--the electrical unit of capacity that equals 1,000
watts.
kWmonth: Kilowattmonth--the electrical unit of the monthly
amount of capacity.
kWh: Kilowatthour--the electrical unit of energy that equals
1,000 watts in 1 hour.
mill: A monetary denomination of the United States that equals
one tenth of a cent or one thousandth of a dollar.
NEPA: National Environmental Policy Act of 1969 (42 U.S.C. 4321,
et seq.).
NITS: Network Integration Transmission Service.
Non-firm: A type of product and/or service not always available
at the time requested by the customer.
O&M: Operation and Maintenance.
Power: Capacity and energy.
Reclamation: United States Department of the Interior, Bureau of
Reclamation.
Revenue Requirement: The revenue required to recover annual
expenses (such as O&M, transmission service expenses, interest,
deferred expenses) and repayment of Federal investments, and other
assigned costs.
SCADA: Supervisory Control and Data Acquisition.
WALC: Western Area Lower Colorado BATO, operated by Desert
Southwest Region.
Western: United States Department of Energy, Western Area Power
Administration.
Effective Date
The new interim rates will take effect on the first day of the
first full billing period beginning on or after January 1, 2006, and
will remain in effect until December 31, 2010, pending approval by
the Commission on a final basis.
Public Notice and Comment
Western followed the Procedures for Public Participation in
Power and Transmission Rate Adjustments and Extensions, 10 CFR part
903, in developing these rates. The steps Western took to involve
interested parties in the rate process were:
1. On June 22, 2005, Western mailed a notice announcing an
informal meeting, which was held July 12, 2005. At this informal
meeting, Western explained the rationale for the rate adjustment,
presented rate designs and methodologies, and answered questions.
2. A Federal Register notice published on July 1, 2005 (70 FR
38130), announced the proposed rates for the Central Arizona
Project, began a public consultation and comment period, and
announced the public information and public comment forums.
3. On July 18, 2005, Western's Desert Southwest Region mailed
letters to all the Central Arizona Project customers and interested
parties transmitting the Brochure for Proposed Rates and the Federal
Register notice published on July 1, 2005.
4. On July 21, 2005, Western mailed data to the Central Arizona
Project customers and interested parties, in response to customers'
data request at the informal customer meeting.
5. On July 22, 2005, beginning at 10 a.m., Western held a public
information forum at the Desert Southwest Regional office in
Phoenix, Arizona. Western provided detailed explanations of the
proposed rates for CAP, and a list of issues that could affect the
proposed rates. Western also answered questions, provided rate
brochures, supporting documentation, and informational handouts.
6. On August 22, 2005, beginning at 1 p.m., Western held a
comment forum to give the public an opportunity to comment for the
record. There were no comments at this forum.
7. Western received one comment letter during the consultation
and comment period, which ended September 29, 2005. All formally
submitted comments have been considered in preparing this Rate
Order.
Comments
Written comments were received from the following organizations:
Central Arizona Water Conservation District.
Project Description
The CAP was authorized by passage of the Colorado River Basin
Project Act (Act of September 30, 1968, Pub. L. 90-537, 82 Stat.
885) for the purposes of furnishing irrigation
[[Page 1535]]
water and municipal water supplies to the water-deficient areas of
Arizona and western New Mexico through direct diversion or exchange
of water, conservation and development of fish and wildlife
resources, enhancement of recreation opportunities, and for other
purposes.
The Secretary of the Interior was directed to construct, operate
and maintain the CAP, consisting of the following principal works:
(1) A system of main conduits and canals, including a main canal and
pumping plants for diverting and carrying water; (2) water storage
facilities and power-pumping plants; (3) aqueducts and pumping
plants; (4) related canals, regulating facilities, hydroelectric
power plants, and electrical transmission facilities required for
the operation of said principal works; (5) related water
distribution and drainage works; and (6) appurtenant works.
The Colorado River Basin Project Act also authorized Federal
participation with non-Federal interests for construction,
operation, and maintenance of a thermal generating power plant
(Navajo Generating Station or NGS) whereby the United States
acquired the rights to plant capacity, including the delivery of
power and energy over appurtenant transmission facilities to
mutually agreed upon delivery points, as the Secretary of the
Interior determines is required to provide pumping power for the
CAP.
When not required for the CAP, the NGS power and energy may be
disposed of by the Secretary of the Interior for other purposes at
such prices the Secretary determines, including its marketing in
conjunction with the sale of power and energy from Federal power
plants in the Colorado River system, so as to produce the greatest
practicable amount of power and energy that can be sold at firm
power and energy rates.
On August 4, 1977, the Department of Energy Organization Act
(Pub. L. 95-91, 91 Stat. 565; 42 U.S.C. 7101) was signed into law,
establishing the DOE. Section 302(a)(3) of the Act created Western
within DOE. Section 302(a)(1)(E) transferred the power marketing
functions of the Bureau of Reclamation, including the construction,
operation, and maintenance of transmission lines and attendant
facilities to the DOE.
Transmission Rate Methodology Study
Western prepared a transmission rate methodology study to ensure
that transmission service rates are adequate to recover the costs
associated with providing transmission service on the CAP 115/230-kV
transmission system. The design includes all transmission expenses
and associated offsetting revenues.
Western reviews the CAP rate design each year to determine if
revenues will be sufficient to repay, within the required time, all
costs assigned to the Central Arizona Project revenues. Repayment
criteria are based on law, policies including DOE Order RA 6120.2,
and authorizing legislation.
The revised firm transmission rate for CAP firm transmission
reflects an overall rate decrease of approximately 2.87 percent for
2006 when compared to the existing CAP firm transmission rate in
Rate Schedule CAP-FT1.
Comparison of Current and Provisional Firm Transmission Rate
----------------------------------------------------------------------------------------------------------------
Proposed formula rates
Type of service Existing rates 115/230-kV 115/230-kV system 1/1/ Percent change
system 2006
----------------------------------------------------------------------------------------------------------------
Firm Transmission Service.............. $9.83/kW/year............ $9.55/kW/year............ (2.87%)
Nonfirm Transmission Service........... 1.12 mills/kWh........... 1.09 mills/kWh........... (2.87%)
----------------------------------------------------------------------------------------------------------------
Western's revised rate formula will be used to calculate rates
annually for all current and future CAP transmission service. The
current CAP transmission rate formula became effective on January 1,
2001. The current CAP rate under WAPA Rate Order No. 88 will expire
December 31, 2005. The revised transmission rate formula is expected
to be effective January 1, 2006, through December 31, 2010. These
rate formulas include costs for scheduling, system control, and
dispatch service.
The methodology is an annual formula that will divide the
average annual transmission revenue requirement by the average
annual transmission reservations to determine the rate for firm
point-to-point transmission service. The annual transmission revenue
requirement includes O&M expenses, administrative and general
expenses, investment costs, and interest expense. This revenue
requirement is offset by any CAP transmission system revenue
credits, such as revenue from non-firm or short-term sales, to
determine the net revenue requirement.
Firm Point-to-Point
Western seeks approval of the rate design formula to calculate
the transmission rate to be applied annually. Using this formula,
the provisional rate for firm CAP transmission service is $9.55 per
kW-year for 2006, a 2.87-percent decrease from the existing
transmission rate of $9.83 per kW-year, which became effective
January 1, 2001. The decrease is due to transmission capacity
reservations increasing more rapidly than increases in total annual
costs. The rate formula is calculated annually, using the most
recent 5-year projections of total expenses and revenues. If needed,
a revised rate will become effective each January 1. The proposed
rate formula would be effective January 1, 2006, through December
31, 2010.
The cost/kW-year is calculated using the following two-step
formula:
[GRAPHIC] [TIFF OMITTED] TN10JA06.000
Where:
ARR = Annual Revenue Requirement. The costs associated with
facilities that support the transfer capability of the CAP
transmission system, excluding generation facilities. These costs
include investment costs, interest expense, administrative and
general expenses, and operation and maintenance expense. The revenue
requirement for CAP is based on projected average costs for the
upcoming 5-year rate-setting period.
TRC = Transmission Revenue Credits. The revenues generated by the
CAP transmission system not related to the revenues from the sale of
long-term firm transmission.
NARR = Net Annual Transmission Revenue Requirement. The Annual
Revenue Requirement minus Transmission Revenue Credits.
TSTL = CAP Transmission System Total Load. The sum of the total
average CAP transmission capacity under long-term reservation,
including the total network integration loads at system peak for the
upcoming 5-year rate-setting period.
Nonfirm Point-to-Point
The proposed rate for nonfirm point-to-point CAP transmission
service is a mills/kWh rate, based upon the current firm point-to-
point rate and may be discounted. This rate will remain in effect
for the same period as the firm point-to-point rate and will also be
reviewed annually. The provisional rate for CAP non-firm
transmission service is based on the current CAP firm point-to-point
transmission rate. The provisional rate is expressed in mills/kWh
and is a maximum of 1.09 mills/kWh for 2006. Transmission
availability will be posted on Western's OASIS.
Network Integration Transmission Service
The proposed rate for network transmission is a formula
calculation based upon the annual transmission revenue requirement.
There are no changes to the existing network integration
transmission service formula under Rate Schedule CAP-NITS2.
NITS allows a transmission customer to integrate, plan,
economically dispatch, and regulate its network resources to serve
its native load in a way comparable to how a transmission provider
uses its own transmission system to service its native load
customers. The monthly charge methodology for NITS on the CAP 115-kV
and 230-kV transmission lines is the product of the transmission
customer's load-ratio share times one-twelfth of the annual
transmission revenue requirement. The customer's load-ratio share is
calculated on a rolling 12-month basis. The customer's load-ratio
share is equal to that customer's hourly load coincident with the
CAP 115-kV and 230-kV
[[Page 1536]]
transmission lines monthly transmission system peak divided by the
resultant value of the CAP 115-kV and 230-kV transmission lines
monthly transmission system peak minus the CAP 115-kV and 230-kV
transmission lines coincident peak for all firm point-to-point
transmission service plus the CAP 115-kV and 230-kV transmission
lines firm point-to-point transmission service reservations.
The proposed revenue requirement includes the costs for
scheduling, system control, and dispatch service. The reactive
supply and voltage control ancillary service must be purchased from
the WALC BATO. The transmission customer may self-supply the four
remaining ancillary services or request them from WALC. These four
ancillary services are regulation and frequency response service,
energy imbalance service, spinning reserve service, and supplemental
reserve service. The rates for these ancillary services are set
forth in Rate Schedules DSW-SD1, DSW-RS1, DSW-EI1, DSW-FR1, DSW-
SPR1, and DSW-SUR1. Western is currently engaged in a public process
to implement new Rates Schedules for ancillary services, which are
expected to be effective April 1, 2006.
Certification of Rates
Western's Administrator certified that the provisional rates for
CAP transmission service are the lowest possible rates consistent
with sound business principles. The provisional rates were developed
following administrative policies and applicable laws.
Basis for Rate Development
According to Reclamation Law, Western must establish
transmission rates sufficient to recover operation, maintenance,
purchased power and interest expenses, and repayment of investment.
The existing rate for CAP firm transmission under Rate Schedule
CAP-FT1 expires December 31, 2005. Effective January 1, 2006, Rate
Schedule CAP-FT1 will be superseded by the new rates in Rate
Schedule CAP-FT2. The provisional rate for CAP firm point-to-point
transmission is $9.55 per kW per year.
Statement of Revenue and Related Expenses
The following table provides a summary of projected revenue and
expense data for the CAP firm transmission rate through the 5-year
provisional rate approval period.
CAP Firm Transmission.--Comparison of 5-Year Rate Period (FY 2006-FY 2010)
[Total revenues and expenses]
----------------------------------------------------------------------------------------------------------------
Existing formula Proposed formula
rate rate Difference
----------------------------------------------------------------------------------------------------------------
Total Revenues........................................ $34,429,675 $40,103,745 $5,674,070
Revenue Distribution
Expenses:
O&M (including replacements expense).............. 6,417,770 10,864,596 4,446,826
Purchased Power and Wheeling...................... 0 0 0
Interest.......................................... 19,343,148 17,931,221 (1,411,927)
Other............................................. 345,140 1,813,043 1,467,903
--------------------
Total Expenses................................ 26,106,058 30,608,860 4,502,802
====================
Principal Payments:
Original Project and Additions.................... 8,323,302 9,484,969 1,161,667
Replacements...................................... 0 0 0
--------------------
Total Principal Payments...................... 8,323,302 9,484,969 1,161,667
====================
Total Revenue Distribution.................... 34,429,360 40,093,829 5,664,469
----------------------------------------------------------------------------------------------------------------
The cost data reflects an increase in total costs when comparing
the existing rates to the proposed rates. The increases in total
costs, however, are outpaced by increases in total transmission
reservations, resulting in a proposed rate decrease of 2.87 percent
effective January 1, 2006.
Comments
The comments and responses regarding the firm transmission rate,
paraphrased for brevity when not affecting the meaning of the
statement(s), are discussed below. Direct quotes from comment
letters are used for clarification where necessary. The rate process
issues discussed are, (1) Central Arizona Water Conservation
District (CAWCD) O&M costs, (2) Western expenses to the CAP
transmission system, and (3) capital additions and replacements.
1. CAWCD O&M Costs
Comment: The CAWCD representative strongly supports including
the costs identified during the public process. However, there are
other CAP transmission system O&M costs incurred by CAWCD, in
addition to the McCullough O&M charge, which are not reflected in
Western's rate review.
Response: Western has committed to continue to work with CAWCD
to ensure that costs appropriately attributed to the CAP 115/230-kV
transmission system will be included in the rate calculation. O&M
expenses incurred by CAWCD to aid in maintaining the Federal
transmission system are appropriately included in the transmission
rate. Costs will be reviewed annually as part of the annual review
to determine adequacy of the transmission rate.
2. Western Expenses to the CAP Transmission System
Comment: The CAWCD representative indicated the CAP transmission
line miles and SCADA point values that are used to allocate costs
for transmission system studies (``STUDM'' costs) and costs for
assets providing benefit to multiple power systems (``RENTM''
costs), respectively, are too high and should be adjusted.
Response: Western has responded to CAWCD's review of the
allocation practices and stated that adjustments will be made where
appropriate in FY 2006. Any resulting increase or decrease in the
revenue requirement which results in an over or under collection
will be accounted for in the subsequent year.
3. Capital Additions and Replacements in Rate
Comment: The CAWCD representative indicated that Western's July
2005 rate adjustment brochure states that no capital additions or
replacements are projected for FY 2006 through FY 2010. The customer
believes the brochure statement to be untrue, and anticipates annual
costs for capital additions or replacements in FY 2007 and beyond to
average at least $500,000. Those costs should be included in the CAP
transmission rate methodology. CAWCD encourages Western to modify
the proposed CAP transmission rate to be charged for CY 2006 to
include projections for new capital investments.
Response: Western is working with CAWCD and the Bureau of
Reclamation to ensure appropriate amortization costs for capitalized
replacements or additions are included in the rate calculation.
Based on reviews of available data, Western has included an estimate
of $625,000 in replacements for the rate to be charged in CY 2006.
In the event capitalized replacements or additions are added to
plant-in-service in a given year, and the amortization costs
(principal and interest) were not included in
[[Page 1537]]
the rate calculation, they will be included in the subsequent year.
Availability of Information
Information about this rate adjustment, including power
repayment studies, comments, letters, memorandums, and other
supporting material made or kept by Western to develop the
provisional rates, is available for public review in the Desert
Southwest Customer Service Region, Western Area Power
Administration, 615 South 43rd Avenue, Phoenix, Arizona.
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.
Western has determined that 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 NEPA of 1969 (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 that 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.
Submission to the Federal Energy Regulatory Commission
The interim rates herein confirmed, approved, and placed into
effect, together with supporting documents, will be submitted to the
Commission for confirmation and final approval.
Order
In view of the foregoing and under the authority delegated to
me, I confirm and approve on an interim basis, effective January 1,
2006, Rate Schedules CAP-FT2, CAP-NFT2, and CAP-NITS2 for the
Central Arizona Project of the Western Area Power Administration.
The rate schedules shall remain in effect on an interim basis,
pending the Commission's confirmation and approval of them or
substitute rates on a final basis through December 31, 2010.
Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.
Rate Schedule CAP-FT2
Supersedes Rate Schedule CAP-FT1
United States Department of Energy Western Area Power Administration
Central Arizona Project
Schedule of Rate(s) for Firm Point-to-Point CAP 115-kv/230-kv
Transmission Service
Effective: The first day of the first full billing period
beginning on or after January 1, 2006, through December 31, 2010.
Available: In the area served by the Central Arizona Project
(CAP) 115-kV/230-kV transmission system.
Applicable: The transmission service customers shall compensate
the CAP where firm capacity and energy are supplied to the CAP 115-
kV/230-kV transmission system at points of interconnection with
other systems and transmitted and delivered, less losses, to points
of delivery on the CAP 115-kV/230-kV system specified in the
contract or service agreement. The formula for the annual revenue
requirement used to calculate the charges for this firm service
under this schedule was promulgated and may be modified pursuant to
applicable Federal laws, regulations, and policies.
The Desert Southwest Region may modify the charges for firm
point-to-point transmission service upon written notice to the
transmission customer. Any change to the charges to the transmission
customer for firm point-to-point transmission, shall be as set forth
in a revision to this rate schedule promulgated pursuant to
applicable Federal laws, regulations, and policies and made part of
the applicable service contract or service agreement. DSW shall
charge the transmission customer in accordance with the revenue
requirements then in effect.
Character and Conditions of Service: Alternating current at 60
Hertz, three-phase, delivered and metered at the voltages and points
of delivery established by contract or service agreement over the
CAP 115-kV/230-kV transmission system.
Formula Rate for Firm Point-to-Point Transmission Service
Annual Rate = 5-Year Average Annual Revenue Requirement divided by
the 5-Year Average Contract Rate of Delivery, rounded to the nearest
penny.
Monthly Rate = Annual Rate divided by 12, rounded to the nearest
penny.
Calculated Rates
For 2006, the annual firm rate calculates to $9.55 per kW year,
and the monthly firm rate calculates to $0.80 per kW month. Based on
updated financial and load data, recalculated rates will go into
effect on January 1 of each year during the effective rate schedule
period.
Adjustments
For Reactive Power: There shall be no entitlement to transfer of
reactive kilovolt amperes at delivery points, except when such
transfers may be mutually agreed upon by contractor and contracting
officer or their authorized representatives.
For Losses: Capacity and energy losses incurred in connection
with the transmission and delivery of capacity and energy under this
rate schedule shall be supplied by the customer in accordance with
the contract or service agreement.
Billing for Unauthorized Overruns: For each billing period in
which there is a contract violation involving an unauthorized
overrun of the contractual firm transmission obligations, such
overrun shall be billed at 10 times the above rates.
Rate Schedule CAP-NFT2
Supersede Rate Schedule CAP-NFT1
United States Department of Energy Western Area Power Administration
Central Arizona Project
Schedule of Rate(s) for Nonfirm Point-to-Point CAP 115-kV/230-kV
Transmission Service
Effective: The first day of the first full billing period
beginning on or after January 1, 2006, through December 31, 2010.
Available: In the marketing area served by the Central Arizona
Project 115-kV/230-kV transmission system.
Applicable: The transmission service customer shall compensate
the Central Arizona Project (CAP) for nonfirm point-to-point
transmission service where capacity and energy are supplied to the
CAP 115-kV/230-kV transmission system at points of interconnection
with other systems, transmitted subject to the availability of the
transmission capacity, and delivered less losses, to points of
delivery on the CAP 115-kV/230-kV system specified in the contract
or service agreement.
Character and Conditions of Service: Alternating current at 60
Hertz, three-phase, delivered and metered at the voltages and points
of delivery established by contract or service agreement over the
CAP 115-kV/230-kV transmission system.
Formula Rate for Nonfirm Point-to-Point Transmission Service
Nonfirm Point-To-Point Transmission Service Rate: Each
Contractor shall be billed monthly a mills per kilowatthour rate of
scheduled or delivered kilowatthours at point of delivery,
established by contract, payable monthly. This rate is equal to the
CAP 115-kV/230-kV Firm Transmission dollar per kilowattyear rate
then in effect divided by 8760, multiplied by 1,000, rounded to two
decimal places.
Calculated Rate
For 2006, the nonfirm rate calculates to 1.09 mills/kWh. Based
on updated financial and load data, a recalculated rate will go into
effect on January 1 of each year during the effective rate schedule
period.
Adjustments
For Reactive Power: There shall be no entitlement to transfer of
reactive kilovolt amperes at delivery points, except when such
transfers may be mutually agreed upon by contractor and contracting
officer or their authorized representatives.
[[Page 1538]]
For Losses: Capacity and energy losses incurred in connection
with the transmission and delivery of capacity and energy under this
rate schedule shall be supplied by the customer in accordance with
the contract or service agreement.
Rate Schedule CAP-NITS2
Supersedes Rate Schedule CAP-NITS1
United States Department of Energy Western Area Power Administration
Central Arizona Project
Schedule of Rate(s) for Network Integration Transmission Service
Effective: The first day of the first full billing period
beginning on or after January 1, 2006, through December 31, 2010.
Applicable: The transmission customer shall compensate the CAP
each month for Network Integration Transmission Service (NITS)
pursuant to the applicable Network Integration Transmission Service
Agreement and annual revenue requirement referred to below. The
formula for the annual revenue requirement used to calculate the
charges for this service under this schedule was promulgated and may
be modified pursuant to applicable Federal laws, regulations, and
policies.
The Desert Southwest Region (DSW) may modify the charges for
NITS upon written notice to the transmission customer. DSW shall
charge the transmission customer in accordance with the revenue
requirement then in effect.
Formula Rate
Monthly Charge = Transmission Customer's Load-Ratio Share x (Revenue
Requirement/12)
Calculated Rate
The NITS rate is calculated using a projected annual revenue
requirement. Based on updated financial and load data, a
recalculated revenue requirement will go into effect on January 1 of
each year during the effective rate schedule period.
[FR Doc. E6-110 Filed 1-9-06; 8:45 am]
BILLING CODE 6450-01-P
