Pacific Northwest-Pacific Southwest Intertie Project-Rate Order No. WAPA-130, 57563-57568 [E7-19914]

Download as PDF Federal Register / Vol. 72, No. 195 / Wednesday, October 10, 2007 / Notices DEPARTMENT OF ENERGY Western Area Power Administration Pacific Northwest-Pacific Southwest Intertie Project—Rate Order No. WAPA–130 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–130 and Rate Schedules INT–FT4 and INT–NFT3, placing firm and nonfirm transmission service rates for the Pacific NorthwestPacific Southwest Intertie Project (Intertie) 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 (FERC) 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 required investment within the allowable periods. DATES: Rate Schedules INT–FT4 and INT–NFT3 will be placed into effect on an interim basis on the first day of the first full billing period beginning on or after October 1, 2007, and will be in effect until FERC confirms, approves, and places the rate schedules in effect on a final basis ending September 30, 2012, or until the rate schedules are superseded.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– 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, (602) 605–2442, e-mail jmurray@wapa.gov. FOR FURTHER INFORMATION CONTACT: The existing Rate Schedules consist of separate firm transmission service rates for the 230/345–kilovolt (kV) and 500– kV transmission systems, and a nonfirm transmission service rate for the 230/ 345/500–kV transmission system. Rate Schedules INT–FT2 and INT–NFT2, Rate Order No. WAPA–71, were approved for a 56-month period beginning February 1, 1996, and ending rwilkins on PROD1PC63 with NOTICES SUPPLEMENTARY INFORMATION: VerDate Aug<31>2005 17:08 Oct 09, 2007 Jkt 214001 September 30, 2000.1 Rate Schedule INT–FT3, Rate Order No. WAPA–76, superseded Rate Schedule INT–FT2 as it related to firm transmission service on the 230/345–kV transmission system and was approved for a 5-year period beginning January 1, 1999, and ending December 31, 2003.2 Rate Order No. WAPA–91 extended Rate Schedules INT–FT2 and INT–NFT2 beginning October 1, 2000, through December 31, 2003,3 as they related to firm transmission service on the 500–kV transmission system and nonfirm transmission service on the 230/345/ 500–kV transmission system. Rate Order No. WAPA–108 extended Rate Schedules INT–FT2, INT–FT3, and INT–NFT2 beginning January 1, 2004, through December 31, 2006.4 Western initiated a public process to adjust all three transmission service rates via a notice published in the Federal Register on July 12, 2006, (71 FR 39310). Rate Order No. WAPA–133 extended the public process for the rate adjustment that was initiated on July 12, 2006, and extended the existing rate schedules again beginning January 1, 2007, through December 31, 2007.5 The existing firm transmission service Rate Schedules are being superseded by Rate Schedule INT–FT4. Under Rate Schedule INT–FT2, the rate for firm point-to-point 500–kV transmission service is $17.23 per kilowattyear (kWyear). Under Rate Schedule INT– FT3, the rate for firm point-to-point 230/ 345–kV transmission service is $12 per kWyear. The provisional rate for firm point-to-point 230/345/500–kV transmission service under Rate Schedule INT–FT4 is $15.24 per kWyear. The provisional rate for firm transmission service in Rate Schedule INT–FT4 results in a decrease of about 1 WAPA–71 was approved by the Deputy Secretary of Energy on January 31, 1996 (61 FR 4650), and confirmed and approved by FERC on a final basis on July 24, 1996, in Docket No. EF96– 5191–000 (76 FERC ¶ 62061). 2 WAPA–76 was approved by the Deputy Secretary of Energy on January 28, 1999 (64 FR 6344), and confirmed and approved by FERC on a final basis on June 22, 1999, in Docket No. EF99– 5191–000 (87 FERC ¶ 61346). 3 WAPA–91 was approved by the Deputy Secretary of Energy on August 15, 2000 (65 FR 52423). FERC accepted this extension pursuant to a letter order from Michael A. Coleman, Director, Division of Tariffs and Rates-West dated October 19, 2000, in Docket No. EF00–5191–000. 4 WAPA–108 was approved by the Deputy Secretary of Energy on October 27, 2003 (68 FR 63083), and approved by FERC on a final basis on March 25, 2004, in Docket No. EF04–5191–000 (106 FERC ¶ 62227). 5 WAPA–133 was approved by the Deputy Secretary of Energy on December 21, 2006 (71 FR 78189) and filed with FERC for informational purposes only, and docketed by FERC in Docket No. EF07–5191–000 on December 21, 2006. PO 00000 Frm 00051 Fmt 4703 Sfmt 4703 57563 11.5 percent when compared with the existing rate under Rate Schedule INT– FT2, and an increase of 27 percent when compared with the existing rate under Rate Schedule INT–FT3. The existing nonfirm transmission service Rate Schedule is being superseded by Rate Schedule INT–NFT3. Under Rate Schedule INT–NFT2, the rate for nonfirm point-to-point 230/345/500–kV transmission service is 2.00 mills per kilowatthour (kWh). The provisional rate for nonfirm point-to-point 230/345/ 500–kV transmission service under Rate Schedule INT–NFT3 is 1.74 mills per kWh. The provisional rate for nonfirm transmission service in Rate Schedule INT–NFT3 results in a decrease of 13 percent when compared with the existing rate under Rate Schedule INT– NFT2. 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 FERC. 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 00–001.00C, and in compliance with 10 CFR part 903, and 18 CFR part 300, I hereby confirm, approve, and place Rate Order No. WAPA–130 and the proposed rates for Intertie transmission service into effect on an interim basis. The new Rate Schedules INT–FT4 and INT–NFT3 will be submitted promptly to FERC for confirmation and approval on a final basis. Dated: September 28, 2007. Clay Sell, Deputy Secretary of Energy. Department of Energy, Deputy Secretary [Rate Order No. WAPA–130] In the Matter of: Western Area Power Administration Rate Adjustment for the Pacific Northwest-Pacific Southwest Intertie Project; Order Confirming, Approving, and Placing the Pacific Northwest-Pacific Southwest Intertie Project Transmission Service Rates Into Effect on an Interim Basis These rates were established in accordance with section 302 of the Department of Energy (DOE) E:\FR\FM\10OCN1.SGM 10OCN1 57564 Federal Register / Vol. 72, No. 195 / Wednesday, October 10, 2007 / Notices rwilkins on PROD1PC63 with NOTICES 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 FERC. 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. Capacity: The electric capability of a generator, transformer, transmission circuit, or other equipment. It is expressed in kilowatts. 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 or service agreement that is receiving service from Western’s Desert Southwest Region. Deficits: Deferred or unrecovered annual expenses. DOE: United States Department of Energy. DOE Order RA 6120.2: An order outlining power marketing administration financial reporting and ratemaking procedures. Desert Southwest Region: The Desert Southwest Customer Service Region of Western. Energy: Measured in terms of the work it is capable of doing over a period of time. It is expressed in kilowatthours. FERC: Federal Energy Regulatory Commission Firm: type of product and/or service that is available at the time requested by the customer. VerDate Aug<31>2005 17:08 Oct 09, 2007 Jkt 214001 FRN: Federal Register notice. FY: Fiscal year; October 1 to September 30. Intertie: Pacific Northwest-Pacific Southwest Intertie Project. 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. kWh: Kilowatthour—the electrical unit of energy that equals 1,000 watts in 1 hour. kWmonth: Kilowattmonth—the electrical unit of the monthly amount of capacity. kWyear: Kilowattyear—the electrical unit of the yearly amount of capacity. mill: A monetary denomination of the United States that equals one tenth of a cent or one thousandth of a dollar. mills/kWh: Mills per kilowatthour—a unit of charge. NEPA: National Environmental Policy Act of 1969 (42 U.S.C. 4321, et seq.). Nonfirm: A type of product and/or service not always available at the time requested by the customer. O&M: Operation and Maintenance. Proposed Rate: A rate that has been recommended by Western to the Deputy Secretary of Energy for approval. Provisional Rate: A rate that has been confirmed, approved, and placed into effect on an interim basis by the Deputy Secretary of Energy. PRS: Power Repayment Study. Rate Brochure: Documents prepared for public distribution explaining the rationale and background for the rate proposal contained in this rate order dated July 2006 and February 2007. Ratesetting PRS: The PRS used for the rate adjustment proposal. Revenue Requirement: The revenue required to recover annual expenses (such as O&M, purchased transmission capacity, interest and deferred expenses) and repay Federal investments and other assigned costs. Supporting Documentation: A compilation of data and documents that support the Rate Brochure and the rate proposal. Western: United States Department of Energy, Western Area Power Administration. Effective Date The new provisional rates will take effect on the first day of the first full billing period beginning on or after October 1, 2007, and will remain in effect until September 30, 2012, pending approval by FERC on a final basis. Public Notice and Comment Western followed the Procedures for Public Participation in Power and PO 00000 Frm 00052 Fmt 4703 Sfmt 4703 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 May 15, 2006, Western’s Desert Southwest Region mailed a notice announcing an informal meeting to all Intertie customers and interested parties. The informal meeting was held June 15, 2006, in Phoenix, Arizona. At this informal meeting, Western explained the rationale for the rate adjustment, presented proposed rates and answered questions. 2. A FRN was published on July 12, 2006, (71 FR 39310) officially announcing the proposed rates for transmission service, initiating a public consultation and comment period, and announcing the public information and public comment forums. 3. On July 28, 2006, Western’s Desert Southwest Region mailed letters to all Intertie customers and interested parties transmitting a copy of the published FRN (71 FR 39310). 4. On August 17, 2006, Western’s Desert Southwest Region held a public information forum in Phoenix, Arizona. Western explained the proposed rates and potential changes to the proposed rates, answered questions, and provided rate brochures and presentation handouts. 5. On August 24, 2006, Western’s Desert Southwest Region held a public comment forum in Phoenix, Arizona to give the public an opportunity to comment for the record. There were no comments at this forum. 6. Western received no comment letters during the consultation and comment period, which ended October 10, 2006. 7. A FRN was published on December 28, 2006 (71 FR 78189), extending the public process for the rate adjustment and announcing additional public information and public comment forums. 8. On December 29, 2006, Western’s Desert Southwest Region mailed letters to all Intertie customers and interested parties transmitting a copy of the published FRN (71 FR 78189). 9. On February 8, 2007, Western’s Desert Southwest Region held an additional public information forum in Phoenix, Arizona. Western explained alternatives to the proposed rates, answered questions, and provided presentation handouts. 10. On February 26, 2007, Western’s Desert Southwest Region sent written responses to customers’ questions that were remaining from the additional public information forum. E:\FR\FM\10OCN1.SGM 10OCN1 Federal Register / Vol. 72, No. 195 / Wednesday, October 10, 2007 / Notices 11. On February 27, 2007, Western’s Desert Southwest Region held an additional public comment forum in Phoenix, Arizona to give the public an opportunity to comment for the record. There were no comments at this forum. 12. Western received one comment letter during the extended consultation and comment period, which ended March 28, 2007. All formally submitted comments have been considered in preparing this Rate Order. 13. Western provided a Web site for information about this rate adjustment process. The Web site is located at http://www.wapa.gov/dsw/pwrmkt/ Intertie/RateAdjust. Comments Written comments were received from the following organization: Arizona Power Authority. Project Description The Intertie was authorized by Section 8 of the Pacific Northwest Power Marketing Act of August 31, 1964 (16 U.S.C. 837g). The basic purpose of the Intertie was to provide, through transmission system interconnections among certain Federal and non-Federal power systems, maximum utilization of power resources to meet growing demands. This purpose was to be accomplished through the exchange of summer-winter surplus peaking capacity between the northwest and southwest to reduce capital expenditures for new generating capacity; the sale of northwest secondary energy to the southwest; the sale of southwest energy to the northwest to ‘‘firm’’ peaking hydroelectric sources during critical water years; conservation of significant amounts of fuel through the use of surplus hydroelectric energy; and increased efficiency in the operation of hydroelectric and thermal resources. As authorized, the Intertie was to be a cooperative construction venture by Federal and non-Federal entities, incorporating the capability for alternating current (AC) and direct current (DC) transmission service. The Lower Colorado Region, Bureau of Reclamation (Reclamation), U.S. Department of the Interior, was assigned construction jurisdiction for: (i) The Celilo-Mead 750-kV DC transmission line from the Oregon-Nevada border to Mead Substation; (ii) Mead Substation; and (iii) all facilities south of Mead Substation. Several delays in construction funding for the CeliloMead 750-kV DC transmission line revised its estimated in-service date to the point that potential users withdrew their interest. This, and the subsequent lack of congressional funding, resulted in the May 1969 indefinite postponement of the Celilo-Mead 750kV DC transmission line construction. The only facilities constructed were Mead Substation and all facilities south of Mead Substation, which provide AC transmission service. Pursuant to section 302 of the Department of Energy Organization Act (42 U.S.C. 7152), dated August 4, 1977, these Reclamation constructed facilities were transferred to Western. Western’s Desert Southwest Region administers these facilities as a standalone transmission project for operational, financial, and repayment purposes. The transmission facilities consist of a 256-mile, 500-kV transmission line from Mead Substation (Nevada) to Perkins Substation (Arizona); a 202-mile, 500-kV transmission line from Mead Substation to Adelanto Switching Substation (California); a 238-mile, 345-kV transmission line from Mead Substation to Liberty Substation (Arizona); a 19mile, 230-kV transmission line from Liberty Substation to Westwing Substation (Arizona); and a 22-mile, 230-kV transmission line from Westwing Substation to Pinnacle Peak Substation (Arizona). 57565 Power Repayment Study— Transmission Service Rates Western prepares a PRS each FY to determine if revenues will be sufficient to repay, within the required time, all costs assigned to the Intertie revenues. Repayment criteria are based on law, policies, including DOE Order RA 6120.2, and authorizing legislation. To meet the Cost Recovery Criteria outlined in DOE Order RA 6120.2, a revised study and rate adjustment have been developed to demonstrate that sufficient revenues will be collected to meet future obligations. The provisional rates for Intertie will become effective on an interim basis on the first day of the first full billing period beginning on or after October 1, 2007. Under Rate Schedule INT–FT4, the provisional rate for Intertie 230/345/ 500-kV firm transmission service will result in a rate decrease of approximately 11.5 percent when compared to the existing rate for Intertie 500-kV firm transmission service in Rate Schedule INT–FT2, and a rate increase of 27 percent when compared to the existing rate for Intertie 230/345-kV firm transmission service in Rate Schedule INT–FT3. The current rate for Intertie 500-kV firm transmission service under Rate Schedule INT–FT2 is $17.23 per kWyear. The current rate for Intertie 230/345-kV firm transmission service under Rate Schedule INT–FT3 is $12 per kWyear. The provisional rate for Intertie 230/345/500-kV firm transmission service is $15.24 per kWyear. Under Rate Schedule INT– NFT3, the provisional rate for Intertie 230/345/500-kV nonfirm transmission service will result in a rate decrease of 13 percent. The current rate under Rate Schedule INT–NFT2 is 2.00 mills/kWh. The provisional rate is 1.74 mills/kWh. Existing and Provisional Rates A comparison of the existing and provisional rates for Intertie transmission service follows: COMPARISON OF EXISTING AND PROVISIONAL RATES: PACIFIC NORTHWEST-PACIFIC SOUTHWEST INTERTIE PROJECT Existing rates Provisional rates (effective 10/1/07) 230/345-kV Firm ........................................ 500-kV Firm ............................................... 230/345/500-kV Nonfirm ............................ rwilkins on PROD1PC63 with NOTICES Transmission service $12.00/kWyear .......................................... $17.23 /kWyear ......................................... 2.00 mills/kWh ........................................... $15.24 /kWyear ......................................... $15.24 /kWyear ......................................... 1.74 mills/kWh ........................................... Certification of Rates Western’s Administrator certified that the provisional rates for Intertie transmission service under Rate Schedules INT–FT4 and IN–NFT3 are the lowest possible rates consistent with sound business principles. The VerDate Aug<31>2005 17:08 Oct 09, 2007 Jkt 214001 provisional rates were developed following administrative policies and applicable laws. Intertie Transmission Rate Discussion According to Reclamation Law, Western must establish transmission PO 00000 Frm 00053 Fmt 4703 Sfmt 4703 Change 27.0% (11.5%) (13.0%) rates sufficient to recover operation, maintenance, purchased transmission and interest expenses, and repay transmission investment. The Intertie transmission rates are insufficient due to higher-than-expected costs for O&M and purchased E:\FR\FM\10OCN1.SGM 10OCN1 57566 Federal Register / Vol. 72, No. 195 / Wednesday, October 10, 2007 / Notices transmission and lower-than-projected sales of 500-kV transmission service that have occurred since the existing rates were established. Future cost estimates for O&M and purchased transmission have increased in the Ratesetting PRS. In addition, sales forecasts of 500-kV transmission service over the next five years have been adjusted to allow Western additional time to market this service. The lower-than-projected sales of 500kV transmission service and higherthan-expected costs for O&M and purchased transmission have created deficits in the Intertie PRS and these conditions are expected to continue through FY 2010. These deficits are scheduled to be repaid within the allowable period under the provisional rates. The existing rates for Intertie transmission service under Rate Schedules INT–FT2, INT–FT3, and INT–NFT2 expire December 31, 2007. Effective October 1, 2007, Rate Schedules INT–FT2, INT–FT3, and INT–NFT2 will be superseded by the new rates in Rate Schedules INT–FT4 and INT–NFT3. The provisional rates for Intertie transmission service consist of a firm point-to-point rate and a nonfirm point-to-point rate. The provisional firm point-to-point rate is $15.24 per kWyear, and the provisional nonfirm point-to-point rate is 1.74 mills/kWh. Western intends to modify its billing practices for Intertie long-term firm transmission service. Existing billing practices require customers to pay for long-term firm transmission service after the fact, usually one month after the service is provided. In today’s business and economic environment, a customer’s financial and credit status can change quickly, and under existing billing practices, Western can experience up to four months of uncollectible revenue before it becomes apparent that a customer is unable to pay its transmission service bills. On more than one occasion, Western has dealt with uncollectible revenue due to a customer’s bankruptcy or credit rating change. Western’s risk of non-payment is further increased by the fact that several of the Intertie long-term firm transmission service customers are not traditional preference customers. Many are independent power producers and other entities whose financial status can significantly and rapidly change due to the volatile energy market. Uncollectible revenue places all ratepayers at risk, since Western assumes full collection of all revenue when developing rates for long-term firm transmission service. To the extent that revenue is uncollectible, the rate will be insufficient to recover revenue requirements, which will result in upward pressure on rates for longterm transmission service. To mitigate the credit risk exposure and the uncollectible revenue vulnerability, Western will require Intertie customers to pay for long-term firm transmission service one month in advance. This requirement is incorporated into Rate Schedule INT– FT4 and will be implemented upon the appropriate revision to Western’s Open Access Transmission Tariff and notice to long-term firm transmission service customers. Statement of Revenue and Related Expenses The following table provides a summary of projected revenue and expense data for the Intertie firm transmission rate through the 5-year provisional rate approval period. INTERTIE FIRM TRANSMISSION RATE: COMPARISON OF 5-YEAR RATE PERIOD (FY 2008–FY 2012), TOTAL REVENUES AND EXPENSES Existing rate ($000) Total Revenues .................................................................................................................... Proposed rate ($000) Difference ($000) $140,577 $159,709 $19,132 21,899 0 2,397 90,569 2,174 32,043 2,755 2,397 99,305 3,699 10,144 2,755 0 8,736 1,525 Total Expenses ...................................................................................................... Principal Payments: Capitalized Expenses ................................................................................................... Original Project and Additions ...................................................................................... Replacements ............................................................................................................... 117,039 140,199 23,160 23,493 0 45 19,465 0 45 (4,028) 0 0 Total Principal Payments ...................................................................................... 23,538 19,510 (4,028) Total Revenue Distribution .................................................................................................. 140,577 159,709 19,132 Revenue Distribution Expenses: O&M .............................................................................................................................. Purchased Transmission .............................................................................................. Abandoned Project ....................................................................................................... Interest .......................................................................................................................... Other ............................................................................................................................. rwilkins on PROD1PC63 with NOTICES Basis for Rate Development The existing rates for Intertie transmission service under Rate Schedules INT–FT2, INT–FT3, and INT–NFT2 expire December 31, 2007. The existing rates no longer provide sufficient revenues to pay all annual costs, including interest, and repayment of investment within the allowable period. The adjusted rates reflect cost VerDate Aug<31>2005 17:08 Oct 09, 2007 Jkt 214001 increases primarily in O&M, purchased transmission, and interest. The provisional rates will provide sufficient revenue to pay all annual costs, including interest, and repayment of investment within the allowable periods. The provisional rates will take effect on October 1, 2007, to correspond with the start of the Federal fiscal year, PO 00000 Frm 00054 Fmt 4703 Sfmt 4703 and will remain in effect through September 30, 2012. 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. E:\FR\FM\10OCN1.SGM 10OCN1 Federal Register / Vol. 72, No. 195 / Wednesday, October 10, 2007 / Notices Comment: A customer supports Western’s rate adjustment proposal which includes having all deficits paid by FY 2017 and commends Western for exploring methods to control costs and stabilize rates. Response: Western appreciates the support it has received during the public process for this rate adjustment proposal. Western will continue to work with customers to control costs and maintain stable transmission service rates. Comment: A customer supports Western’s proposal to modify its existing billing practices and require payment in advance for Intertie longterm firm 230/345/500-kV transmission service. Response: Western acknowledges the comment in support of the modification in billing practices for Intertie long-term firm 230/345/500-kV transmission service. Western will proceed with implementing the change as specified in this rate order. Availability of Information Information about this rate adjustment, including PRSs, comments, letters, memorandums, and other supporting material made or kept by Western and used to develop the provisional rates, is available for public review in the Desert Southwest Regional Office, Western Area Power Administration, 615 South 43rd Avenue, Phoenix, Arizona. Ratemaking Procedure Requirements Environmental Compliance In compliance with the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321, et seq.); Council on Environmental Quality Regulations for implementing NEPA (40 CFR parts 1500–1508); and DOE NEPA Implementing Procedures and Guidelines (10 CFR part 1021), Western has determined that this action is categorically excluded from preparing an environmental assessment or an environmental impact statement. rwilkins on PROD1PC63 with NOTICES 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. Submission to the Federal Energy Regulatory Commission The provisional interim rates herein confirmed, approved, and placed into effect, together with supporting documents, will be submitted to FERC for confirmation and final approval. VerDate Aug<31>2005 17:08 Oct 09, 2007 Jkt 214001 Order In view of the foregoing and under the authority delegated to me, I confirm and approve on an interim basis, effective October 1, 2007, Rate Schedules INT– FT4 and INT–NFT3 for the Pacific Northwest-Pacific Southwest Intertie Project of the Western Area Power Administration. The rate schedules shall remain in effect on an interim basis pending FERC’s confirmation and approval of them or substitute rates on a final basis through September 30, 2012. Dated: September 28, 2007. Clay Sell, Deputy Secretary of Energy. Rate Schedule INT–FT4 (Supersedes Rate Schedules INT–FT2 and INT–FT3) United States Department of Energy; Western Area Power Administration Pacific Northwest-Pacific Southwest Intertie Project Schedule of Rates for Long-Term and Short-Term Firm Point-to-Point 230/ 345/500-KV Transmission Service Effective: The first day of the first full billing period beginning on or after October 1, 2007, and will remain in effect through September 30, 2012, or until superseded by another rate schedule, whichever occurs first. Available: In the area served by the Pacific Northwest-Pacific Southwest Intertie Project (Intertie) 230/345/500kV transmission system. Applicable: To firm point-to-point transmission service customers where capacity and energy are supplied to the Intertie 230/345/500-kV transmission system at points of interconnection with other systems and transmitted and delivered, less losses, to points of delivery on the Intertie 230/345/500-kV transmission system. Character and Conditions of Service: Alternating current at 60 hertz, threephase, delivered and metered at the voltages and points of delivery established by service agreement or contract. Long-Term Rate: For transmission service one year or longer, the rate is $15.24 for each kilowatt (kW) per year, payable monthly at the rate of $1.27 for each kW per month. Short-Term Rates: For transmission service up to one year, the maximum rate for each kW is as follows: Monthly: $1.27 Weekly: $0.2931 Daily: $0.0418 Hourly: 1.74 mills Discounts may be offered from timeto-time in accordance with Western’s PO 00000 Frm 00055 Fmt 4703 Sfmt 4703 57567 Open Access Transmission Tariff (OATT). Billing: Western will bill firm pointto-point transmission service customers monthly by applying the rates listed above to the amount of capacity reserved. Upon the appropriate revision to Western’s OATT and notification to long-term firm transmission customers, payment for service will be required one month in advance of said service. 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 the customer and Western or their authorized representatives. Adjustments 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 service agreement or contract. Overrun of Capacity Reserved: Western will assess a charge for unauthorized use of transmission service at a rate equal to two (2) times the applicable rate for the service at issue. The charge will be applied to use in excess of the reservation amount (‘‘the overrun’’), which shall be the difference between the amount of transmission service actually used by the customer less the amount of transmission service the customer has reserved. The customer will incur the charge for an overrun during the calendar month or for the period of transmission service if such service is for a term of less than one month. Rate Schedule INT–NFT3 (Supersedes Rate Schedule INT–NFT2) United States Department of Energy; Western Area Power Administration Pacific Northwest-Pacific Southwest Intertie Project Schedule of Rate for Nonfirm 230/345/ 500-kV Transmission Service Effective: The first day of the first full billing period beginning on or after October 1, 2007, and will remain in effect through September 30, 2012, or until superseded by another rate schedule, whichever occurs first. Available: In the area served by the Pacific Northwest-Pacific Southwest Intertie Project (Intertie) 230/345/500kV transmission system. Applicable: To nonfirm transmission service customers where capacity and energy are supplied to the Intertie 230/ 345/500-kV transmission system at points of interconnection with other systems and transmitted and delivered, less losses, to points of delivery on the E:\FR\FM\10OCN1.SGM 10OCN1 57568 Federal Register / Vol. 72, No. 195 / Wednesday, October 10, 2007 / Notices Intertie 230/345/500-kV transmission system. Character and Conditions of Service: Interruptible transmission service on a three-phase alternating current at 60 hertz, delivered and metered at the voltages and points of delivery established by service agreement or in advance by Western. Curtailment conditions shall be determined by Western and in accordance with Western’s Open Access Transmission Tariff (OATT). Rate: The nonfirm transmission service rate is 1.74 mills for each kilowatt per hour. Discounts may be offered from time-to-time in accordance with Western’s OATT. Billing: Western will bill nonfirm transmission service customers monthly by applying the rate listed above to the amount of capacity reserved. 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 the customer and Western or their authorized representatives. Adjustment 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 service agreement or contract. [FR Doc. E7–19914 Filed 10–9–07; 8:45 am] BILLING CODE 6450–01–P ENVIRONMENTAL PROTECTION AGENCY [EPA–HQ–OPP–2007–0409; FRL–8150–3] The Association of American Pesticide Control Officials (AAPCO)/State FIFRA Issues Research and Evaluation Group (SFIREG) Working Committee on Water Quality/Pesticide Disposal (WC/ WQPD); Notice of Public Meeting Environmental Protection Agency (EPA). ACTION: Notice. AGENCY: The Association of American Pesticide Control Officials (AAPCO)/ State FIFRA Issues Research and Evaluation Group (SFIREG) Working Committee on Working Committee on Water Quality & Pesticide Disposal (WC/WQ/PD) will hold a 2–day meeting, beginning on October 29, 2007 and ending October 30, 2007. This notice announces the location and times for the meeting and sets forth the tentative agenda topics. rwilkins on PROD1PC63 with NOTICES SUMMARY: VerDate Aug<31>2005 17:08 Oct 09, 2007 Jkt 214001 The meeting will be held on October 29, 2007 from 8:30 a.m. to 5 p.m. and 8:30 a.m. to 12 noon on October 30, 2007. To request accommodation of a disability, please contact the person listed under FOR FURTHER INFORMATON CONTACT, preferably at least 10 days prior to the meeting, to give EPA as much time as possible to process your request. ADDRESSES: The meeting will be held at EPA, 2777 Crystal Dr., One Potomac Yard South, 4th Floor South Conference Center, Arlington, VA 22202. FOR FURTHER INFORMATION CONTACT: Georgia McDuffie, Field and External Affairs Division, (7506P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave., NW., Washington, DC 20460– 0001; telephone number: (703) 605– 0195; fax number: (703) 308–1850; email address: mcduffie.georgia@epa.gov or Grier Stayton, Executive Secretary, P.O. Box 466 Milford, DE 19963; telephone number: (302) 422–8152; fax: (302) 422–2435; email: ≥grier stayton≥aapco-sfireg@comcast.net. SUPPLEMENTARY INFORMATION: DATES: I. General Information A. Does this Action Apply to Me? You may be potentially affected by this action if you are interested in SFIREG information exchange relationship with EPA regarding important issues related to human health, environmental exposure to pesticides, and insight into EPA’s decision-making process are invited and encouraged to attend the meetings and participate as appropriate. ’’ Potentially affected entities may include, but are not limited to: Those persons who are or may be required to conduct testing of chemical substances under the Federal Food, Drug and Cosmetic Act (FFDCA), or the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA). B. How Can I Get Copies of this Document and Other Related Information? 1. Docket. EPA has established a docket for this action under docket identification (ID) number EPA–HQ– OPPT–2007–0409 Publicly available docket materials are available either in the electronic docket at http:// www.regulations.gov, or, if only available in hard copy, at the Office of Pesticide Programs (OPP) Regulatory Public Docket in Rm. S–4400, One Potomac Yard (South Bldg.), 2777 S. Crystal Dr., Arlington, VA. The hours of operation of this Docket Facility are from 8:30 a.m. to 4 p.m., Monday PO 00000 Frm 00056 Fmt 4703 Sfmt 4703 through Friday, excluding legal holidays. The Docket Facility telephone number is (703) 305–5805. 2. Electronic access. You may access this Federal Register document electronically through the EPA Internet under the ‘‘Federal Register’’ listings at http://www.epa.gov/fedrgstr. II. Tentative Agenda 1. Buffers to Protect Surface Water 2. OPP Surface Water and Ground Water Benchmarks 3. USGS Water Quality Pesticide Projects 4. Container Recycling 5. Endangered Species: Water Quality Issues 6. Performance Measures, ‘‘Pesticides of Interest’’ List, On-line Reporting 7. SFIREG WQ/PD State Reporting and Participation 8. Exposure Modeling Public Meeting: Activities Report 9. SFIREG Disposal White Paper and EPA Follow-up 10. Pesticide Degradate Information Tracking 11. AAPCO/SFIREG & ASIWPCA Benchmarks Project 12. Inert Ingredient WQ impacts: Nonylpheonol Exthoxylates 13. Ground Water Advisory Statement & Label Review Manual, Chapter 8 14. Atrazine: Post-IRED OPP Activities Update 15. Office Water Atrazine Implementation Workplan – Region 5 16. EPA Update/Briefing: a. Office of Pesticide Programs Update b. Office of Enforcement Compliance Assurance Update List of Subjects Environmental protection. Dated: September 26, 2007. William R. Diamond, Director, Field External Affairs Division, Office of Pesticide Programs [FR Doc. E7–19655 Filed 10–9–07; 8:45 am] BILLING CODE 6560–50–S ENVIRONMENTAL PROTECTION AGENCY [FRL–8480–4] Science Advisory Board Staff Office; Clean Air Scientific Advisory Committee (CASAC); Notification of a Public Teleconference of the NOX and SOX Secondary NAAQS Review Panel Environmental Protection Agency (EPA). ACTION: Notice. AGENCY: SUMMARY: The Environmental Protection Agency (EPA or Agency) Science E:\FR\FM\10OCN1.SGM 10OCN1

Agencies

[Federal Register Volume 72, Number 195 (Wednesday, October 10, 2007)]
[Notices]
[Pages 57563-57568]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-19914]



[[Page 57563]]

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

DEPARTMENT OF ENERGY

Western Area Power Administration


Pacific Northwest-Pacific Southwest Intertie Project--Rate Order 
No. WAPA-130

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-130 and Rate Schedules INT-FT4 and INT-NFT3, placing 
firm and nonfirm transmission service rates for the Pacific Northwest-
Pacific Southwest Intertie Project (Intertie) 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 (FERC) 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 required investment within the 
allowable periods.

DATES: Rate Schedules INT-FT4 and INT-NFT3 will be placed into effect 
on an interim basis on the first day of the first full billing period 
beginning on or after October 1, 2007, and will be in effect until FERC 
confirms, approves, and places the rate schedules in effect on a final 
basis ending September 30, 2012, 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) 605-2453, 
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, (602) 605-2442, e-mail 
jmurray@wapa.gov.

SUPPLEMENTARY INFORMATION: The existing Rate Schedules consist of 
separate firm transmission service rates for the 230/345-kilovolt (kV) 
and 500-kV transmission systems, and a nonfirm transmission service 
rate for the 230/345/500-kV transmission system. Rate Schedules INT-FT2 
and INT-NFT2, Rate Order No. WAPA-71, were approved for a 56-month 
period beginning February 1, 1996, and ending September 30, 2000.\1\ 
Rate Schedule INT-FT3, Rate Order No. WAPA-76, superseded Rate Schedule 
INT-FT2 as it related to firm transmission service on the 230/345-kV 
transmission system and was approved for a 5-year period beginning 
January 1, 1999, and ending December 31, 2003.\2\ Rate Order No. WAPA-
91 extended Rate Schedules INT-FT2 and INT-NFT2 beginning October 1, 
2000, through December 31, 2003,\3\ as they related to firm 
transmission service on the 500-kV transmission system and nonfirm 
transmission service on the 230/345/500-kV transmission system. Rate 
Order No. WAPA-108 extended Rate Schedules INT-FT2, INT-FT3, and INT-
NFT2 beginning January 1, 2004, through December 31, 2006.\4\ Western 
initiated a public process to adjust all three transmission service 
rates via a notice published in the Federal Register on July 12, 2006, 
(71 FR 39310). Rate Order No. WAPA-133 extended the public process for 
the rate adjustment that was initiated on July 12, 2006, and extended 
the existing rate schedules again beginning January 1, 2007, through 
December 31, 2007.\5\
---------------------------------------------------------------------------

    \1\ WAPA-71 was approved by the Deputy Secretary of Energy on 
January 31, 1996 (61 FR 4650), and confirmed and approved by FERC on 
a final basis on July 24, 1996, in Docket No. EF96-5191-000 (76 FERC 
] 62061).
    \2 \ WAPA-76 was approved by the Deputy Secretary of Energy on 
January 28, 1999 (64 FR 6344), and confirmed and approved by FERC on 
a final basis on June 22, 1999, in Docket No. EF99-5191-000 (87 FERC 
] 61346).
    \3\ WAPA-91 was approved by the Deputy Secretary of Energy on 
August 15, 2000 (65 FR 52423). FERC accepted this extension pursuant 
to a letter order from Michael A. Coleman, Director, Division of 
Tariffs and Rates-West dated October 19, 2000, in Docket No. EF00-
5191-000.
    \4\ WAPA-108 was approved by the Deputy Secretary of Energy on 
October 27, 2003 (68 FR 63083), and approved by FERC on a final 
basis on March 25, 2004, in Docket No. EF04-5191-000 (106 FERC ] 
62227).
    \5\ WAPA-133 was approved by the Deputy Secretary of Energy on 
December 21, 2006 (71 FR 78189) and filed with FERC for 
informational purposes only, and docketed by FERC in Docket No. 
EF07-5191-000 on December 21, 2006.
---------------------------------------------------------------------------

    The existing firm transmission service Rate Schedules are being 
superseded by Rate Schedule INT-FT4. Under Rate Schedule INT-FT2, the 
rate for firm point-to-point 500-kV transmission service is $17.23 per 
kilowattyear (kWyear). Under Rate Schedule INT-FT3, the rate for firm 
point-to-point 230/345-kV transmission service is $12 per kWyear. The 
provisional rate for firm point-to-point 230/345/500-kV transmission 
service under Rate Schedule INT-FT4 is $15.24 per kWyear. The 
provisional rate for firm transmission service in Rate Schedule INT-FT4 
results in a decrease of about 11.5 percent when compared with the 
existing rate under Rate Schedule INT-FT2, and an increase of 27 
percent when compared with the existing rate under Rate Schedule INT-
FT3. The existing nonfirm transmission service Rate Schedule is being 
superseded by Rate Schedule INT-NFT3. Under Rate Schedule INT-NFT2, the 
rate for nonfirm point-to-point 230/345/500-kV transmission service is 
2.00 mills per kilowatthour (kWh). The provisional rate for nonfirm 
point-to-point 230/345/500-kV transmission service under Rate Schedule 
INT-NFT3 is 1.74 mills per kWh. The provisional rate for nonfirm 
transmission service in Rate Schedule INT-NFT3 results in a decrease of 
13 percent when compared with the existing rate under Rate Schedule 
INT-NFT2.
    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 FERC. 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 00-001.00C, and in 
compliance with 10 CFR part 903, and 18 CFR part 300, I hereby confirm, 
approve, and place Rate Order No. WAPA-130 and the proposed rates for 
Intertie transmission service into effect on an interim basis. The new 
Rate Schedules INT-FT4 and INT-NFT3 will be submitted promptly to FERC 
for confirmation and approval on a final basis.

    Dated: September 28, 2007.
Clay Sell,
Deputy Secretary of Energy.

Department of Energy, Deputy Secretary

[Rate Order No. WAPA-130]

In the Matter of: Western Area Power Administration Rate Adjustment for 
the Pacific Northwest-Pacific Southwest Intertie Project; Order 
Confirming, Approving, and Placing the Pacific Northwest-Pacific 
Southwest Intertie Project Transmission Service Rates Into Effect on an 
Interim Basis

    These rates were established in accordance with section 302 of the 
Department of Energy (DOE)

[[Page 57564]]

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 FERC. 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.
Capacity: The electric capability of a generator, transformer, 
transmission circuit, or other equipment. It is expressed in kilowatts.
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 or service agreement that is 
receiving service from Western's Desert Southwest Region.
Deficits: Deferred or unrecovered annual expenses.
DOE: United States Department of Energy.
DOE Order RA 6120.2: An order outlining power marketing administration 
financial reporting and ratemaking procedures.
Desert Southwest Region: The Desert Southwest Customer Service Region 
of Western.
Energy: Measured in terms of the work it is capable of doing over a 
period of time. It is expressed in kilowatthours.
FERC: Federal Energy Regulatory Commission
Firm: type of product and/or service that is available at the time 
requested by the customer.
FRN: Federal Register notice.
FY: Fiscal year; October 1 to September 30.
Intertie: Pacific Northwest-Pacific Southwest Intertie Project.
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.
kWh: Kilowatthour--the electrical unit of energy that equals 1,000 
watts in 1 hour.
kWmonth: Kilowattmonth--the electrical unit of the monthly amount of 
capacity.
kWyear: Kilowattyear--the electrical unit of the yearly amount of 
capacity.
mill: A monetary denomination of the United States that equals one 
tenth of a cent or one thousandth of a dollar.
mills/kWh: Mills per kilowatthour--a unit of charge.
NEPA: National Environmental Policy Act of 1969 (42 U.S.C. 4321, et 
seq.).
Nonfirm: A type of product and/or service not always available at the 
time requested by the customer.
O&M: Operation and Maintenance.
Proposed Rate: A rate that has been recommended by Western to the 
Deputy Secretary of Energy for approval.
Provisional Rate: A rate that has been confirmed, approved, and placed 
into effect on an interim basis by the Deputy Secretary of Energy.
PRS: Power Repayment Study.
Rate Brochure: Documents prepared for public distribution explaining 
the rationale and background for the rate proposal contained in this 
rate order dated July 2006 and February 2007.
Ratesetting PRS: The PRS used for the rate adjustment proposal.
Revenue Requirement: The revenue required to recover annual expenses 
(such as O&M, purchased transmission capacity, interest and deferred 
expenses) and repay Federal investments and other assigned costs.
Supporting Documentation: A compilation of data and documents that 
support the Rate Brochure and the rate proposal.
Western: United States Department of Energy, Western Area Power 
Administration.

Effective Date

    The new provisional rates will take effect on the first day of the 
first full billing period beginning on or after October 1, 2007, and 
will remain in effect until September 30, 2012, pending approval by 
FERC 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 May 15, 2006, Western's Desert Southwest Region mailed a 
notice announcing an informal meeting to all Intertie customers and 
interested parties. The informal meeting was held June 15, 2006, in 
Phoenix, Arizona. At this informal meeting, Western explained the 
rationale for the rate adjustment, presented proposed rates and 
answered questions.
    2. A FRN was published on July 12, 2006, (71 FR 39310) officially 
announcing the proposed rates for transmission service, initiating a 
public consultation and comment period, and announcing the public 
information and public comment forums.
    3. On July 28, 2006, Western's Desert Southwest Region mailed 
letters to all Intertie customers and interested parties transmitting a 
copy of the published FRN (71 FR 39310).
    4. On August 17, 2006, Western's Desert Southwest Region held a 
public information forum in Phoenix, Arizona. Western explained the 
proposed rates and potential changes to the proposed rates, answered 
questions, and provided rate brochures and presentation handouts.
    5. On August 24, 2006, Western's Desert Southwest Region held a 
public comment forum in Phoenix, Arizona to give the public an 
opportunity to comment for the record. There were no comments at this 
forum.
    6. Western received no comment letters during the consultation and 
comment period, which ended October 10, 2006.
    7. A FRN was published on December 28, 2006 (71 FR 78189), 
extending the public process for the rate adjustment and announcing 
additional public information and public comment forums.
    8. On December 29, 2006, Western's Desert Southwest Region mailed 
letters to all Intertie customers and interested parties transmitting a 
copy of the published FRN (71 FR 78189).
    9. On February 8, 2007, Western's Desert Southwest Region held an 
additional public information forum in Phoenix, Arizona. Western 
explained alternatives to the proposed rates, answered questions, and 
provided presentation handouts.
    10. On February 26, 2007, Western's Desert Southwest Region sent 
written responses to customers' questions that were remaining from the 
additional public information forum.

[[Page 57565]]

    11. On February 27, 2007, Western's Desert Southwest Region held an 
additional public comment forum in Phoenix, Arizona to give the public 
an opportunity to comment for the record. There were no comments at 
this forum.
    12. Western received one comment letter during the extended 
consultation and comment period, which ended March 28, 2007. All 
formally submitted comments have been considered in preparing this Rate 
Order.
    13. Western provided a Web site for information about this rate 
adjustment process. The Web site is located at http://www.wapa.gov/dsw/
pwrmkt/Intertie/RateAdjust.

Comments

    Written comments were received from the following organization: 
Arizona Power Authority.

Project Description

    The Intertie was authorized by Section 8 of the Pacific Northwest 
Power Marketing Act of August 31, 1964 (16 U.S.C. 837g). The basic 
purpose of the Intertie was to provide, through transmission system 
interconnections among certain Federal and non-Federal power systems, 
maximum utilization of power resources to meet growing demands. This 
purpose was to be accomplished through the exchange of summer-winter 
surplus peaking capacity between the northwest and southwest to reduce 
capital expenditures for new generating capacity; the sale of northwest 
secondary energy to the southwest; the sale of southwest energy to the 
northwest to ``firm'' peaking hydroelectric sources during critical 
water years; conservation of significant amounts of fuel through the 
use of surplus hydroelectric energy; and increased efficiency in the 
operation of hydroelectric and thermal resources. As authorized, the 
Intertie was to be a cooperative construction venture by Federal and 
non-Federal entities, incorporating the capability for alternating 
current (AC) and direct current (DC) transmission service.
    The Lower Colorado Region, Bureau of Reclamation (Reclamation), 
U.S. Department of the Interior, was assigned construction jurisdiction 
for: (i) The Celilo-Mead 750-kV DC transmission line from the Oregon-
Nevada border to Mead Substation; (ii) Mead Substation; and (iii) all 
facilities south of Mead Substation. Several delays in construction 
funding for the Celilo-Mead 750-kV DC transmission line revised its 
estimated in-service date to the point that potential users withdrew 
their interest. This, and the subsequent lack of congressional funding, 
resulted in the May 1969 indefinite postponement of the Celilo-Mead 
750-kV DC transmission line construction. The only facilities 
constructed were Mead Substation and all facilities south of Mead 
Substation, which provide AC transmission service. Pursuant to section 
302 of the Department of Energy Organization Act (42 U.S.C. 7152), 
dated August 4, 1977, these Reclamation constructed facilities were 
transferred to Western.
    Western's Desert Southwest Region administers these facilities as a 
stand-alone transmission project for operational, financial, and 
repayment purposes. The transmission facilities consist of a 256-mile, 
500-kV transmission line from Mead Substation (Nevada) to Perkins 
Substation (Arizona); a 202-mile, 500-kV transmission line from Mead 
Substation to Adelanto Switching Substation (California); a 238-mile, 
345-kV transmission line from Mead Substation to Liberty Substation 
(Arizona); a 19-mile, 230-kV transmission line from Liberty Substation 
to Westwing Substation (Arizona); and a 22-mile, 230-kV transmission 
line from Westwing Substation to Pinnacle Peak Substation (Arizona).

Power Repayment Study--Transmission Service Rates

    Western prepares a PRS each FY to determine if revenues will be 
sufficient to repay, within the required time, all costs assigned to 
the Intertie revenues. Repayment criteria are based on law, policies, 
including DOE Order RA 6120.2, and authorizing legislation. To meet the 
Cost Recovery Criteria outlined in DOE Order RA 6120.2, a revised study 
and rate adjustment have been developed to demonstrate that sufficient 
revenues will be collected to meet future obligations.
    The provisional rates for Intertie will become effective on an 
interim basis on the first day of the first full billing period 
beginning on or after October 1, 2007. Under Rate Schedule INT-FT4, the 
provisional rate for Intertie 230/345/500-kV firm transmission service 
will result in a rate decrease of approximately 11.5 percent when 
compared to the existing rate for Intertie 500-kV firm transmission 
service in Rate Schedule INT-FT2, and a rate increase of 27 percent 
when compared to the existing rate for Intertie 230/345-kV firm 
transmission service in Rate Schedule INT-FT3. The current rate for 
Intertie 500-kV firm transmission service under Rate Schedule INT-FT2 
is $17.23 per kWyear. The current rate for Intertie 230/345-kV firm 
transmission service under Rate Schedule INT-FT3 is $12 per kWyear. The 
provisional rate for Intertie 230/345/500-kV firm transmission service 
is $15.24 per kWyear. Under Rate Schedule INT-NFT3, the provisional 
rate for Intertie 230/345/500-kV nonfirm transmission service will 
result in a rate decrease of 13 percent. The current rate under Rate 
Schedule INT-NFT2 is 2.00 mills/kWh. The provisional rate is 1.74 
mills/kWh.

Existing and Provisional Rates

    A comparison of the existing and provisional rates for Intertie 
transmission service follows:

       Comparison of Existing and Provisional Rates: Pacific Northwest-Pacific Southwest Intertie Project
----------------------------------------------------------------------------------------------------------------
                                                                              Provisional rates
           Transmission service                   Existing rates             (effective 10/1/07)        Change
----------------------------------------------------------------------------------------------------------------
230/345-kV Firm..........................  $12.00/kWyear...............  $15.24 /kWyear.............       27.0%
500-kV Firm..............................  $17.23 /kWyear..............  $15.24 /kWyear.............     (11.5%)
230/345/500-kV Nonfirm...................  2.00 mills/kWh..............  1.74 mills/kWh.............     (13.0%)
----------------------------------------------------------------------------------------------------------------

Certification of Rates

    Western's Administrator certified that the provisional rates for 
Intertie transmission service under Rate Schedules INT-FT4 and IN-NFT3 
are the lowest possible rates consistent with sound business 
principles. The provisional rates were developed following 
administrative policies and applicable laws.

Intertie Transmission Rate Discussion

    According to Reclamation Law, Western must establish transmission 
rates sufficient to recover operation, maintenance, purchased 
transmission and interest expenses, and repay transmission investment.
    The Intertie transmission rates are insufficient due to higher-
than-expected costs for O&M and purchased

[[Page 57566]]

transmission and lower-than-projected sales of 500-kV transmission 
service that have occurred since the existing rates were established. 
Future cost estimates for O&M and purchased transmission have increased 
in the Ratesetting PRS. In addition, sales forecasts of 500-kV 
transmission service over the next five years have been adjusted to 
allow Western additional time to market this service.
    The lower-than-projected sales of 500-kV transmission service and 
higher-than-expected costs for O&M and purchased transmission have 
created deficits in the Intertie PRS and these conditions are expected 
to continue through FY 2010. These deficits are scheduled to be repaid 
within the allowable period under the provisional rates.
    The existing rates for Intertie transmission service under Rate 
Schedules INT-FT2, INT-FT3, and INT-NFT2 expire December 31, 2007. 
Effective October 1, 2007, Rate Schedules INT-FT2, INT-FT3, and INT-
NFT2 will be superseded by the new rates in Rate Schedules INT-FT4 and 
INT-NFT3. The provisional rates for Intertie transmission service 
consist of a firm point-to-point rate and a nonfirm point-to-point 
rate. The provisional firm point-to-point rate is $15.24 per kWyear, 
and the provisional nonfirm point-to-point rate is 1.74 mills/kWh.
    Western intends to modify its billing practices for Intertie long-
term firm transmission service. Existing billing practices require 
customers to pay for long-term firm transmission service after the 
fact, usually one month after the service is provided. In today's 
business and economic environment, a customer's financial and credit 
status can change quickly, and under existing billing practices, 
Western can experience up to four months of uncollectible revenue 
before it becomes apparent that a customer is unable to pay its 
transmission service bills. On more than one occasion, Western has 
dealt with uncollectible revenue due to a customer's bankruptcy or 
credit rating change. Western's risk of non-payment is further 
increased by the fact that several of the Intertie long-term firm 
transmission service customers are not traditional preference 
customers. Many are independent power producers and other entities 
whose financial status can significantly and rapidly change due to the 
volatile energy market. Uncollectible revenue places all ratepayers at 
risk, since Western assumes full collection of all revenue when 
developing rates for long-term firm transmission service. To the extent 
that revenue is uncollectible, the rate will be insufficient to recover 
revenue requirements, which will result in upward pressure on rates for 
long-term transmission service.
    To mitigate the credit risk exposure and the uncollectible revenue 
vulnerability, Western will require Intertie customers to pay for long-
term firm transmission service one month in advance. This requirement 
is incorporated into Rate Schedule INT-FT4 and will be implemented upon 
the appropriate revision to Western's Open Access Transmission Tariff 
and notice to long-term firm transmission service customers.

Statement of Revenue and Related Expenses

    The following table provides a summary of projected revenue and 
expense data for the Intertie firm transmission rate through the 5-year 
provisional rate approval period.

Intertie Firm Transmission Rate: Comparison of 5-Year Rate Period (FY 2008-FY 2012), Total Revenues and Expenses
----------------------------------------------------------------------------------------------------------------
                                                                Existing rate     Proposed rate     Difference
                                                                   ($000)            ($000)           ($000)
----------------------------------------------------------------------------------------------------------------
Total Revenues..............................................          $140,577          $159,709         $19,132
----------------------------------------------------------------------------------------------------------------
                                              Revenue Distribution
----------------------------------------------------------------------------------------------------------------
Expenses:
    O&M.....................................................            21,899            32,043          10,144
    Purchased Transmission..................................                 0             2,755           2,755
    Abandoned Project.......................................             2,397             2,397               0
    Interest................................................            90,569            99,305           8,736
    Other...................................................             2,174             3,699           1,525
                                                             ---------------------------------------------------
        Total Expenses......................................           117,039           140,199          23,160
Principal Payments:
    Capitalized Expenses....................................            23,493            19,465         (4,028)
    Original Project and Additions..........................                 0                 0               0
    Replacements............................................                45                45               0
                                                             ---------------------------------------------------
        Total Principal Payments............................            23,538            19,510         (4,028)
                                                             ---------------------------------------------------
Total Revenue Distribution..................................           140,577           159,709          19,132
----------------------------------------------------------------------------------------------------------------

Basis for Rate Development

    The existing rates for Intertie transmission service under Rate 
Schedules INT-FT2, INT-FT3, and INT-NFT2 expire December 31, 2007. The 
existing rates no longer provide sufficient revenues to pay all annual 
costs, including interest, and repayment of investment within the 
allowable period. The adjusted rates reflect cost increases primarily 
in O&M, purchased transmission, and interest. The provisional rates 
will provide sufficient revenue to pay all annual costs, including 
interest, and repayment of investment within the allowable periods. The 
provisional rates will take effect on October 1, 2007, to correspond 
with the start of the Federal fiscal year, and will remain in effect 
through September 30, 2012.

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.

[[Page 57567]]

    Comment: A customer supports Western's rate adjustment proposal 
which includes having all deficits paid by FY 2017 and commends Western 
for exploring methods to control costs and stabilize rates.
    Response: Western appreciates the support it has received during 
the public process for this rate adjustment proposal. Western will 
continue to work with customers to control costs and maintain stable 
transmission service rates.
    Comment: A customer supports Western's proposal to modify its 
existing billing practices and require payment in advance for Intertie 
long-term firm 230/345/500-kV transmission service.
    Response: Western acknowledges the comment in support of the 
modification in billing practices for Intertie long-term firm 230/345/
500-kV transmission service. Western will proceed with implementing the 
change as specified in this rate order.

Availability of Information

    Information about this rate adjustment, including PRSs, comments, 
letters, memorandums, and other supporting material made or kept by 
Western and used to develop the provisional rates, is available for 
public review in the Desert Southwest Regional Office, Western Area 
Power Administration, 615 South 43rd Avenue, Phoenix, Arizona.

Ratemaking Procedure Requirements

Environmental Compliance

    In compliance with the National Environmental Policy Act (NEPA) of 
1969 (42 U.S.C. 4321, et seq.); Council on Environmental Quality 
Regulations for implementing NEPA (40 CFR parts 1500-1508); and DOE 
NEPA Implementing Procedures and Guidelines (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.

Submission to the Federal Energy Regulatory Commission

    The provisional interim rates herein confirmed, approved, and 
placed into effect, together with supporting documents, will be 
submitted to FERC 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 October 1, 2007, 
Rate Schedules INT-FT4 and INT-NFT3 for the Pacific Northwest-Pacific 
Southwest Intertie Project of the Western Area Power Administration. 
The rate schedules shall remain in effect on an interim basis pending 
FERC's confirmation and approval of them or substitute rates on a final 
basis through September 30, 2012.


    Dated: September 28, 2007.

Clay Sell,
Deputy Secretary of Energy.

Rate Schedule INT-FT4
(Supersedes Rate Schedules INT-FT2 and INT-FT3)

United States Department of Energy; Western Area Power Administration

Pacific Northwest-Pacific Southwest Intertie Project

Schedule of Rates for Long-Term and Short-Term Firm Point-to-Point 230/
345/500-KV Transmission Service

    Effective: The first day of the first full billing period beginning 
on or after October 1, 2007, and will remain in effect through 
September 30, 2012, or until superseded by another rate schedule, 
whichever occurs first.
    Available: In the area served by the Pacific Northwest-Pacific 
Southwest Intertie Project (Intertie) 230/345/500-kV transmission 
system.
    Applicable: To firm point-to-point transmission service customers 
where capacity and energy are supplied to the Intertie 230/345/500-kV 
transmission system at points of interconnection with other systems and 
transmitted and delivered, less losses, to points of delivery on the 
Intertie 230/345/500-kV transmission system.
    Character and Conditions of Service: Alternating current at 60 
hertz, three-phase, delivered and metered at the voltages and points of 
delivery established by service agreement or contract.
    Long-Term Rate: For transmission service one year or longer, the 
rate is $15.24 for each kilowatt (kW) per year, payable monthly at the 
rate of $1.27 for each kW per month.
    Short-Term Rates: For transmission service up to one year, the 
maximum rate for each kW is as follows:

Monthly: $1.27
Weekly: $0.2931
Daily: $0.0418
Hourly: 1.74 mills

    Discounts may be offered from time-to-time in accordance with 
Western's Open Access Transmission Tariff (OATT).
    Billing: Western will bill firm point-to-point transmission service 
customers monthly by applying the rates listed above to the amount of 
capacity reserved. Upon the appropriate revision to Western's OATT and 
notification to long-term firm transmission customers, payment for 
service will be required one month in advance of said service.
    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 the customer and Western 
or their authorized representatives.
    Adjustments 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 service agreement or contract.
    Overrun of Capacity Reserved: Western will assess a charge for 
unauthorized use of transmission service at a rate equal to two (2) 
times the applicable rate for the service at issue. The charge will be 
applied to use in excess of the reservation amount (``the overrun''), 
which shall be the difference between the amount of transmission 
service actually used by the customer less the amount of transmission 
service the customer has reserved. The customer will incur the charge 
for an overrun during the calendar month or for the period of 
transmission service if such service is for a term of less than one 
month.

Rate Schedule INT-NFT3
(Supersedes Rate Schedule INT-NFT2)

United States Department of Energy; Western Area Power Administration

Pacific Northwest-Pacific Southwest Intertie Project

Schedule of Rate for Nonfirm 230/345/500-kV Transmission Service

    Effective: The first day of the first full billing period beginning 
on or after October 1, 2007, and will remain in effect through 
September 30, 2012, or until superseded by another rate schedule, 
whichever occurs first.
    Available: In the area served by the Pacific Northwest-Pacific 
Southwest Intertie Project (Intertie) 230/345/500-kV transmission 
system.
    Applicable: To nonfirm transmission service customers where 
capacity and energy are supplied to the Intertie 230/345/500-kV 
transmission system at points of interconnection with other systems and 
transmitted and delivered, less losses, to points of delivery on the

[[Page 57568]]

Intertie 230/345/500-kV transmission system.
    Character and Conditions of Service: Interruptible transmission 
service on a three-phase alternating current at 60 hertz, delivered and 
metered at the voltages and points of delivery established by service 
agreement or in advance by Western. Curtailment conditions shall be 
determined by Western and in accordance with Western's Open Access 
Transmission Tariff (OATT).
    Rate: The nonfirm transmission service rate is 1.74 mills for each 
kilowatt per hour. Discounts may be offered from time-to-time in 
accordance with Western's OATT.
    Billing: Western will bill nonfirm transmission service customers 
monthly by applying the rate listed above to the amount of capacity 
reserved.
    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 the customer and Western 
or their authorized representatives.
    Adjustment 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 service agreement or contract.

 [FR Doc. E7-19914 Filed 10-9-07; 8:45 am]
BILLING CODE 6450-01-P