Pick-Sloan Missouri Basin Program-Eastern Division-Rate Order No. WAPA-147, 67197-67204 [E9-30149]
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Federal Register / Vol. 74, No. 242 / Friday, December 18, 2009 / Notices
Dated: December 14, 2009.
The first day of the first full billing
period beginning on or after January 1,
2010, through December 31, 2014.
Available:
Within the marketing area served by
the Loveland Area Projects.
Applicable:
To the wholesale power Customers for
firm electric service supplied through
one meter at one point of delivery, or as
otherwise established by contract.
Character:
Alternating current, 60 hertz, three
phase, delivered and metered at the
voltages and points established by
contract.
Monthly Rates:
Capacity Charge: $5.43 per kilowatt of
billing capacity.
Daniel B. Poneman
Deputy Secretary
Rate Schedule L–F9
(Supersedes Rate Schedule L–F8)
Effective January 1, 2010
United States Department of Energy
Western Area Power Administration
Loveland Area Projects Colorado,
Kansas, Nebraska, Wyoming
Schedule of Rates For Firm Electric
Service
(Approved Under Rate Order No.
WAPA–146)
Effective:
67197
Energy Charge: 20.71 mills per
kilowatthour (kWh) of monthly
entitlement.
Billing Capacity: Unless otherwise
specified by contract, the billing
capacity will be the seasonal contract
rate of delivery.
Charge Components:
Base: A fixed revenue requirement
that includes operation and
maintenance expense, investment
repayment and associated interest,
normal timing power purchases
(purchases due to operational
constraints, not associated with
drought), and transmission costs. The
Base revenue requirement is $51.2
million.
50% × Base Revenue Requirement
= $3.29 / kWmonth
Firm Billing Capacity
50% × Base Revenue Requirement
= 12.54 mills / kWmonth
Base Energy =
Annual Energy
Base Capacity =
Drought Adder: A formula-based
revenue requirement that includes
future purchase power expense in
excess of timing purchases, previous
purchase power drought deficits, and
interest on the purchase power drought
deficits. For the period beginning on or
after the first day of the first full billing
period beginning on or after January 1,
2010, the Drought Adder revenue
requirement is $33.3 million.
50% × Drought Adder Revenue Requirement
= $2.14 / kWmonth
Firm Billing Capacity
50% × Drought Adder Revenue Requirement
= 8.17 mills/kWh
Drought Adder Energy =
Annual Energy
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power factor at all points of
measurement between 95-percent
lagging and 95-percent leading.
[FR Doc. E9–30147 Filed 12–17–09; 8:45 am]
BILLING CODE 6450–01–P
DEPARTMENT OF ENERGY
Western Area Power Administration
Pick-Sloan Missouri Basin Program—
Eastern Division—Rate Order No.
WAPA–147
AGENCY: Western Area Power
Administration, DOE.
ACTION: Notice of Order Concerning
Firm Power Rates.
SUMMARY: The Deputy Secretary of
Energy confirmed and approved Rate
Order No. WAPA–147 and Rate
Schedules P–SED–F11 and P–SED–
FP11, placing firm power and firm
peaking power rates from the Pick-Sloan
Missouri Basin Program—Eastern
Division (P–SMBP—ED) of the Western
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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 power investments and irrigation
aid within the allowable periods.
DATES: Rate Schedules P–SED–F11 and
P–SED–FP11 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, 2010, and will remain
in effect until FERC confirms, approves,
and places the rate schedules in effect
on a final basis ending December 31,
2014, or until the rate schedules are
superseded.
FOR FURTHER INFORMATION CONTACT: Mr.
Robert J. Harris, Regional Manager,
Upper Great Plains Region, Western
Area Power Administration, 2900 4th
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Process:
Any proposed change to the Base
component will require a public
process. The Drought Adder component
may be adjusted annually using the
above formulas for any costs attributed
to drought of less than or equal to the
equivalent of 2 mills/kWh to the LAP
composite rate. Any planned
incremental adjustment to the Drought
Adder component greater than the
equivalent of 2 mills/kWh to the LAP
composite rate will require a public
process.
Adjustments:
For Drought Adder: Adjustments
pursuant to the Drought Adder
component will be documented in a
revision to this rate schedule.
For Transformer Losses: If delivery is
made at transmission voltage but
metered on the low-voltage side of the
substation, the meter readings will be
increased to compensate for transformer
losses as provided for in the contract.
For Power Factor: None. The
Customer will be required to maintain a
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Drought Adder Capacity =
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Federal Register / Vol. 74, No. 242 / Friday, December 18, 2009 / Notices
Avenue North, Billings, MT 59101–
1266, telephone (406) 247–7405, e-mail
rharris@wapa.gov, or Ms. Linda CadyHoffman, Rates Manager, Upper Great
Plains Region, Western Area Power
Administration, 2900 4th Avenue North,
Billings, MT 59101–1266, (406) 247–
7439, e-mail cady@wapa.gov.
SUPPLEMENTARY INFORMATION: The
Acting Deputy Secretary of Energy
approved existing Rate Schedules P–
SED–F10 and P–SED–FP10 for P–
SMBP—ED firm and firm peaking
electric service, respectively, on an
interim basis on January 8, 2009 (74 FR
3022, January 16, 2009), for a 5-year
period beginning on February 1, 2009,
and ending December 31, 2013.1
Under Rate Schedule P–SED–F10, the
composite rate is 29.34 mills per
kilowatthour (mills/kWh), the firm
energy rate is 16.71 mills/kWh, and the
firm capacity rate is $6.80 per
kilowattmonth (kWmonth). Under Rate
Schedule P–SED–FP10, the firm peaking
capacity rate is $6.20/kWmonth. These
Rate Schedules are formula based with
Base and Drought Adder components
and provide for an up to 2 mills/kWh
increase in the Drought Adder
component.
The current rate adjustment reflects a
rate increase based on the P–SMBP
Final Fiscal Year (FY) 2008 Power
Repayment Study (PRS). The PRS sets
the total annual P–SMBP—ED revenue
requirement for 2010 for firm and firm
peaking electric service at $320.2
million, or a 13.1 percent increase. The
current rates, including the 2 mills/kWh
increase provided for under the Drought
Adder formula rate component, are not
sufficient to meet the P–SMBP—ED
revenue requirements.
The P–SMBP—ED revenue
requirement increase is mainly
attributed to the financial impacts of the
drought. A decrease in hydro-power
generation has caused purchase power
expenses to increase and revenue from
non-firm energy sales to decrease. There
has been an increase in both the price
and volume of purchase power needed
to meet contractual commitments to
Western’s Customers. The purchase
price of power is set by supply and
demand on the open market.
The existing firm electric service Rate
Schedules P–SED–F10 and P–SED–FP10
are being superseded by Rate Schedules
P–SED–F11 and P–SED–FP11,
respectively. Under Rate Schedule P–
SED–F11, the provisional rates for firm
1 FERC confirmed and approved Rate Order No.
WAPA–140 on April 28, 2009, in Docket No. EF09–
5031–000. See United States Department of Energy,
Western Area Power Administration, Pick-Sloan
Missouri Basin Program, 127 FERC ¶ 62,075.
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electric services will result in a
combined composite rate of 33.25 mills/
kWh. The energy rate will be 19.05
mills/kWh (a Base component of 9.53
mills/kWh and a Drought Adder
component of 9.52 mills/kWh), and the
capacity rate will be $7.65/kWmonth (a
Base component of $3.80/kWmonth and
a Drought Adder component of $3.85/
kWmonth). Under Rate Schedule P–
SED–FP11, the provisional rates for firm
peaking electric services consist of a
capacity charge of $6.90/kWmonth (a
Base component of $3.45/kWmonth and
a Drought Adder component of $3.45/
kWmonth) and an energy charge of
19.05 mills/kWh (a Base component of
9.53 mills/kWh and a Drought Adder
component of 9.52 mills/kWh).
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 the Administrator
of Western; (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 Department of Energy (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, 10 CFR part
903, and 18 CFR part 300, I hereby
confirm, approve, and place Rate Order
No. WAPA–147, the proposed P–
SMBP—ED firm power, and firm
peaking power rates into effect on an
interim basis.
The new Rate Schedules P–SED–F11
and P–SED–FP11 will be promptly
submitted to FERC for confirmation and
approval on a final basis.
Dated: December 14, 2009.
Daniel B. Poneman,
Deputy Secretary of Energy.
Department of Energy Deputy Secretary
In the matter of: Western Area Power
Administration Rate Adjustment for the
Pick-Sloan Missouri Basin Program—
Eastern Division; Rate Order No.
WAPA–147; Order Confirming,
Approving, and Placing the Pick-Sloan
Missouri Basin Program—Eastern
Division Firm Power and Firm Peaking
Power Service Rates into Effect on an
Interim Basis.
The firm and firm peaking electric
service rates for the Pick-Sloan Missouri
Basin Program—Eastern Division were
established in accordance with section
302 of the Department of Energy (DOE)
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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 section 5 of the
Flood Control Act of 1944 (16 U.S.C.
825s) 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 the Administrator
of Western; (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
Federal Energy Regulatory Commission
(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.
Base: Revenue requirement component of
the power rate including annual operation
and maintenance expenses, investment
repayment and associated interest, normal
timing power purchases, and transmission
costs.
Capacity: The electric capability of a
generator, transformer, transmission circuit,
or other equipment. It is expressed in
kilowatts.
Capacity Charge: The rate which sets forth
the charges for capacity. It is expressed in
dollars per kilowattmonth.
Composite Rate: The rate for commercial
firm power which is the total annual revenue
requirement for capacity and energy divided
by the total annual energy sales. It is
expressed in mills per kilowatthour and used
for comparison purposes.
CROD: Contract Rate of Delivery. The
maximum amount of capacity and energy
allocated to a preference Customer for a
period specified under a contract.
Customer: An entity with a contract that is
receiving service from Western’s Upper Great
Plains Region.
Deficits: Deferred or unrecovered annual
and/or interest expenses.
DOE: United States Department of Energy.
DOE Order RA 6120.2: An order outlining
power marketing administration financial
reporting and rate-making procedures.
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Drought Adder: Formula-based revenue
requirement component including costs
associated with the drought.
Energy: Measured in terms of the work it
is capable of doing over a period of time. It
is expressed in kilowatthours.
Energy Charge: The rate which sets forth
the charges for energy. It is expressed in mills
per kilowatthour and applied to each
kilowatthour delivered to each Customer.
FERC: Federal Energy Regulatory
Commission.
Firm: A type of product and/or service
available at the time requested by the
Customer.
FRN: Federal Register notice.
Fry-Ark: Fryingpan-Arkansas Project.
FY: Fiscal year; October 1 to September 30.
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.
LAP: Loveland Area Projects.
mills/kWh: Mills per kilowatthour—the
unit of charge for energy (equal to one tenth
of a cent or one thousandth of a dollar).
MW: Megawatt—the electrical unit of
capacity that equals 1 million watts or 1,000
kilowatts.
NEPA: National Environmental Policy Act
of 1969 (42 U.S.C. 4321–4347 (2003)).
Non-timing Power Purchases: Power
purchases that are not related to operational
constraints such as management of
endangered species, species habitat, water
quality, navigation, control area purposes,
etc.
O&M: Operation and Maintenance.
P–SMBP: The Pick-Sloan Missouri Basin
Program.
P–SMBP–ED: Pick-Sloan Missouri Basin
Program—Eastern Division.
P–SMBP–WD: Pick-Sloan Missouri Basin
Program—Western Division.
Power: Capacity and energy.
Power Factor: The ratio of real to apparent
power at any given point and time in an
electrical circuit. Generally, it is expressed as
a percentage.
Preference: The provisions of Reclamation
Law which require Western to first make
Federal power available to certain entities.
For example, section 9(c) of the Reclamation
Project Act of 1939 (43 U.S.C. 485h(c)) states
that preference in the sale of Federal power
shall be given to municipalities and other
public corporations or agencies and also to
cooperatives and other nonprofit
organizations financed in whole or in part by
loans made under the Rural Electrification
Act of 1936.
Provisional Rate: A rate which has been
confirmed, approved, and placed into effect
on an interim basis by the Deputy Secretary
of Energy.
PRS: Power Repayment Study.
Rate Brochure: A July 2009 document
explaining the rationale and background for
the rate proposal contained in this Rate
Order.
Reclamation: The United States
Department of the Interior, Bureau of
Reclamation.
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Reclamation Law: A series of Federal laws
that contain the framework under which
Western markets power.
Revenue Requirement: The revenue
required to recover annual expenses (such as
O&M, purchase power, transmission service
expenses, interest, and deferred expenses)
and repay Federal investments and other
assigned costs.
RMR: The Rocky Mountain Customer
Service Region of the Western Area Power
Administration.
UGPR: The Upper Great Plains Customer
Service Region of the Western Area Power
Administration.
Western: The 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
January 1, 2010, and will remain in
effect until December 31, 2014, 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. The proposed rate adjustment
process began March 17, 2009, when
Western’s UGPR mailed a notice
announcing informal Customer
meetings to all P–SMBP–ED preference
Customers and interested parties. The
informal meetings were held on April
15, 2009, in Sioux Falls, South Dakota,
and on April 16, 2009, in Northglenn,
Colorado. At these informal meetings,
Western explained the rationale for the
rate adjustment, presented rate designs
and methodologies, and answered
questions.
2. A Federal Register notice,
published on July 14, 2009 (74 FR
34012), announced the proposed rates
for P–SMBP–ED, began a public
consultation and comment period and
announced the public information and
public comment forums.
3. On July 14, 2009, Western mailed
letters to all P–SMBP–ED preference
Customers and interested parties
transmitting the FRN published on July
14, 2009.
4. On August 18, 2009, at 9 a.m.
(MDT), Western held a public
information forum at the Ramada Plaza
Hotel in Northglenn, Colorado. Western
provided updates to the proposed firm
power rates for the P–SMBP, which
encompasses the P–SMBP–ED and LAP
rates. Western also answered questions
and gave notice that more information
was available in the rate brochure.
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5. On August 18, 2009, at 11 a.m.
(MDT), following the public information
forum, at the same location, a public
comment forum was held. The comment
forum gave the public an opportunity to
comment for the record. No oral or
written comments were received at this
forum.
6. On August 19, 2009, at 9 a.m.
(CDT), Western held a public
information forum at the Holiday Inn in
Sioux Falls, South Dakota. Western
provided updates to the proposed firm
power rates for the P–SMBP–ED.
Western also answered questions and
gave notice that more information was
available in the rate brochure.
7. On August 19, 2009, at 11 a.m.
(CDT), following the public information
forum, and at the same location, a
public comment forum was held. The
comment forum gave the public an
opportunity to comment for the record.
Two oral comments and two exhibits
were received at this forum.
8. Western provided a website which
contains all of the letters, time frames,
dates, and locations of forums,
documents discussed at the information
meetings, FRNs, rate brochure, and all
other information about this rate process
for easy Customer access. The Web site
is located at https://www.wapa.gov/ugp/
rates/2010FirmRateAdjust.
9. During the consultation and
comment period, which ended October
13, 2009, Western received one
comment letter.
All comments received have been
considered in preparing this Rate Order.
Comments
Written comment was received from
the following organization: Mid-West
Electric Consumers Association,
Colorado.
Two representatives of the following
organization made oral comments and
submitted exhibits: Rosebud Sioux
Tribe’s Utilities Commission, South
Dakota.
Project Description
The P–SMBP was authorized by
Congress in Section 9 of the Flood
Control Act of December 22, 1944,
commonly referred to as the Flood
Control Act of 1944. This multipurpose
program provides flood control,
irrigation, navigation, recreation,
preservation and enhancement of fish
and wildlife, and power generation.
Multipurpose projects have been
developed on the Missouri River and its
tributaries in Colorado, Montana,
Nebraska, North Dakota, South Dakota,
and Wyoming.
In addition to the multipurpose water
projects authorized by Section 9 of the
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Flood Control Act of 1944, certain other
existing projects have been integrated
with the P–SMBP for power marketing,
operation, and repayment purposes. The
Colorado-Big Thompson, Kendrick, and
Shoshone Projects were combined with
the P–SMBP in 1954, followed by the
North Platte Project in 1959. These
projects are referred to as the
‘‘Integrated Projects’’ of the P–SMBP.
The Flood Control Act of 1944 also
authorized the inclusion of the Fort
Peck Project with the P–SMBP for
operation and repayment purposes. The
Riverton Project was integrated with the
P–SMBP in 1954 and in 1970 was
reauthorized as a unit of P–SMBP.
The P–SMBP is administered by two
regions. The UGPR, with a regional
office in Billings, Montana, markets
power from the Eastern Division of P–
SMBP, and the RMR, with a regional
office in Loveland, Colorado, markets
the Western Division power of P–SMBP.
The UGPR markets power in western
Iowa, western Minnesota, Montana east
of the Continental Divide, North Dakota,
South Dakota, and the eastern twothirds of Nebraska. The RMR markets P–
SMBP—WD power, which in
combination with Fry-Ark power is
known as LAP power, in northeastern
Colorado, east of the Continental Divide
in Wyoming, west of the 101st meridian
in Nebraska, and most of Kansas. The P–
SMBP power is marketed to
approximately 300 firm power
Customers by the UGPR and
approximately 54 firm power Customers
by the RMR.
Power Repayment Study—Firm Power
Rate
Western prepares a PRS each FY to
determine if revenues will be sufficient
to repay, within the required time, all
costs assigned to the P–SMBP.
Repayment criteria are based on
Western’s applicable laws and
legislation, as well as policies including
DOE Order RA 6120.2. To meet Cost
Recovery Criteria outlined in DOE Order
RA 6120.2, a revised study and rate
adjustment has been developed to
demonstrate that sufficient revenues
will be collected under proposed rates
to meet future obligations.
Existing and Provisional Rates
Eastern Division
Under Rate Schedule P–SED–F10, the
composite rate is 29.34 mills/kWh, the
firm energy rate is 16.71 mills/kWh, and
the firm capacity rate is $6.80/
kWmonth. For Rate Schedule P–SED–
FP10 the firm peaking capacity rate is
$6.20/kWmonth. These Rate Schedules
are formula based with Base and
Drought Adder components and provide
for up to a 2 mills/kWh increase in the
Drought Adder component.
The current rate adjustment reflects a
rate increase based on the P–SMBP FY
2008 PRS. The PRS sets the total annual
P–SMBP—ED revenue requirement for
FY 2010 for firm and firm peaking
electric service at $320.2 million, or a
13.1 percent increase.
A comparison of the existing and
provisional firm power and firm
peaking power rates follow:
TABLE 1—COMPARISON OF EXISTING AND PROVISIONAL RATES PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN
DIVISION
Current rates
Provisional rates
P–SED–F10/P–
SED–FP10
Firm electric service
P–SED–F11/P–
SED–FP11
Rate Schedules:
Firm and Firm Peaking Revenue Requirement (million) ................................................
Composite Rate (mills/kWh) ...........................................................................................
Firm Capacity Rate (/kWmonth) .....................................................................................
Firm Energy Rate (mills/kWh) ........................................................................................
Firm Peaking Capacity Rate (/kWmonth) .......................................................................
Firm Peaking Energy Rate (mills/kWh) 1 ........................................................................
1 Firm
$320.2
33.25
$7.65
19.05
$6.90
19.05
13.1
13.3
12.5
14.0
11.3
14.0
Peaking Energy is normally returned. This rate will be assessed in the event Firm Peaking Energy is not returned.
Western Division
The LAP rate is designed to recover
the P–SMBP—WD revenue requirement
for the P–SMBP and the revenue
requirement for Fry-Ark. The
adjustment to the LAP rate is a separate
formal rate process which is
documented in Rate Order No. WAPA–
146. Rate Order No. WAPA–146 is also
scheduled to go into effect on the first
day of the first full billing period on or
after January 1, 2010.
Certification of Rates
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$283.0
29.34
$6.80
16.71
$6.20
16.71
Percent
change
Western’s Administrator certified that
the provisional rates for P–SMBP—ED
firm power and firm peaking power
rates under Rate Schedules P–SED–F11
and P–SED–FP11 are the lowest
possible rates consistent with sound
business principles. The provisional
rates were developed following
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administrative policies and applicable
laws.
P–SMBP—ED Firm Power Rate
Discussion
Western is required to establish power
rates sufficient to recover operation,
maintenance, purchased power and
interest expenses, and repay power
investment and irrigation aid.
The P–SMBP–ED firm power and firm
peaking power rates must be increased
due to the financial impact of the
drought, increased annual expenses,
increased investments, and increased
interest expenses associated with debt.
Under Rate Schedule P–SED–F11,
Western will continue identifying its
firm electric service revenue
requirement using Base and Drought
Adder components. The Base
component is a fixed revenue
requirement that includes annual O&M
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expenses, investment repayment and
associated interest, normal timing
power purchases, and transmission
costs. Western’s normal timing power
purchases are due to operational
constraints (e.g., management of
endangered species habitat, water
quality, navigation, etc.) and are not
associated with drought. The Base
component cannot be adjusted by
Western without a public process.
The Drought Adder component is a
formula-based revenue requirement that
includes costs attributable to drought
conditions within the P–SMBP. The
Drought Adder component includes
costs associated with future non-timing
power purchases to meet firm power
contractual obligations not covered with
available system generation due to the
drought, previously incurred deficits
due to purchased power debt that
resulted from non-timing power
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purchases made during this drought,
and the interest associated with drought
debt. The Drought Adder component is
designed to repay Western’s drought
debt within 10 years from the time the
debt was incurred, using balloonpayment methodology. For example, the
drought debt incurred by Western in FY
2008 will be repaid by FY 2018.
The annual revenue requirement
calculation will continue to be
summarized by the following formula:
Annual Revenue Requirement = Base
Revenue Requirement + Drought Adder
Revenue Requirement. Under this
provisional rate, the P–SMBP–ED
annual revenue requirement equals
$332.8 million and is comprised of a
Base revenue requirement of $166
million plus a Drought Adder revenue
requirement of $166.8 million. Both the
Base and Drought Adder components
recover portions of the firm power
revenue requirement, firm peaking
power, and associated 5 percent
discount revenue necessary to equal the
P–SMBP–ED revenue requirement. A
comparison of the current and proposed
rate components are listed in Table 2.
TABLE 2—SUMMARY OF P–SMBP—ED RATE COMPONENTS
Existing rates
P–SED–F10/P–SED–FP10
Base component
Firm
Firm
Firm
Firm
Capacity Rate (/kWmonth) ..................................................
Energy Rate (mills/kWh) ......................................................
Peaking Capacity Rate (/kWmonth) ....................................
Peaking Energy Rate (mills/kWh) 1 .....................................
1 Firm
Drought
adder
component
$3.80
9.27
$3.40
9.27
$3.00
7.44
$2.80
7.44
Provisional rates
P–SED–F11/P–SED–FP11
Total
Base component
Drought
adder
component
$3.80
9.53
$3.45
9.53
$3.85
9.52
$3.45
9.52
$6.80
16.71
$6.20
16.71
Total
$7.65
19.05
$6.90
19.05
peaking energy is normally returned. This will be assessed in the event firm peaking energy is not returned.
As set forth in Table 2 above,
provisional Rate Schedule P–SED–F11
has a firm capacity rate of $7.65/
kWmonth and a firm energy rate of
19.05 mills/kWh. Under Rate Schedule
P–SED–FP11, the firm peaking capacity
rate will increase to $6.90/kWmonth, or
an 11 percent increase. Peaking energy
is either returned to Western or paid for
in accordance with the terms of the
contract between Western and the
peaking power Customer.
Continuing to identify the firm
electric service revenue requirement
using Base and Drought Adder
components will assist Western in
presenting the effects of the drought
within the P–SMBP, demonstrating
repayment of the drought related costs,
and allow Western to be more
responsive to changes in drought related
expenses. Western will continue to
charge and bill Customers firm electric
service rates for energy and capacity,
which are the sum of the Base and
Drought Adder components.
Western reviews its firm electric
service rates annually. Western will
review the Base component after the
annual PRS is completed, generally in
the first quarter of the calendar year. If
an adjustment to the Base component is
necessary, Western will initiate a public
process pursuant to 10 CFR part 903
prior to making an adjustment.
In accordance with the original
implementation of the Drought Adder
component, Western will continue to
review the Drought Adder component
each September to determine if drought
costs differ from those projected in the
PRS. If drought costs differ, Western
will determine if an adjustment to the
Drought Adder component is necessary.
Western will notify Customers by letter
each October of the planned
incremental or decremental adjustment
and implement the adjustment in the
January billing cycle. Although
decremental adjustments to the Drought
Adder component will occur as drought
costs are repaid, the adjustments cannot
result in a negative Drought Adder
component. To give Customers advance
notice, Western will conduct a
preliminary review of the Drought
Adder component in early summer and
notify Customers by letter of the
estimated change to the Drought Adder
component for the following January.
Western will verify the final Drought
Adder component adjustment by
notification in the October letter to the
Customers. Implementing the Drought
Adder component adjustment on
January 1 of each year will help keep
the drought deficits from escalating as
quickly, will lower the interest expense
due to drought deficits, will
demonstrate responsible deficit
management, and will provide prompt
drought deficit repayments.
Western’s current and provisional rate
schedules provide for a formula-based
adjustment of the Drought Adder
component of up to 2 mills/kWh. The 2
mills/kWh cap is intended to place a
limit on the amount the Drought Adder
formula can be adjusted relative to
associated drought costs without
initiating a public process to recover
costs attributable to the Drought Adder
formula rate for any one-year cycle.
Statement of Revenue and Related
Expenses
The following Table 3 provides a
summary of projected revenue and
expense data for the total P–SMBP,
including both the Eastern and Western
Divisions, firm electric service revenue
requirement through the 5-year rate
approval period.
The firm power rates for both
divisions have been developed with the
following revenues and expenses for the
P–SMBP:
sroberts on DSKD5P82C1PROD with NOTICES
TABLE 3—TOTAL P–SMBP FIRM POWER COMPARISON OF 5-YEAR RATE PERIOD (FY 2010–2014)
[Total revenues and expenses]
Current rate
($000)
Total Revenues ............................................................................................................................
Revenue Distribution
Expenses:
VerDate Nov<24>2008
17:33 Dec 17, 2009
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Fmt 4703
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$2,417,497
E:\FR\FM\18DEN1.SGM
18DEN1
Provisional
rate
($000)
$2,625,336
Difference
($000)
$207,839
67202
Federal Register / Vol. 74, No. 242 / Friday, December 18, 2009 / Notices
TABLE 3—TOTAL P–SMBP FIRM POWER COMPARISON OF 5-YEAR RATE PERIOD (FY 2010–2014)—Continued
[Total revenues and expenses]
Current rate
($000)
Provisional
rate
($000)
Difference
($000)
O&M ......................................................................................................................................
Purchased Power .................................................................................................................
Interest ..................................................................................................................................
Transmission ........................................................................................................................
859,559
431,180
639,356
65,963
904,884
440,038
650,671
65,853
45,325
8,858
11,315
(110)
Total Expenses ..............................................................................................................
1,996,058
2,061,446
65,388
Principal Payments:
Capitalized Expenses (Deficits) 1 .................................................................................................
Original Project and Additions 1 ............................................................................................
Replacements 1 .....................................................................................................................
Irrigation Aid .........................................................................................................................
351,517
1,546
2,704
65,672
483,252
10,414
4,825
65,399
131,735
8,868
2,121
(273)
Total Principal Payments ..............................................................................................
421,439
563,890
142,451
Total Revenue Distribution .....................................................................................
2,417,497
2,625,336
207,839
1 Due
to the deficit or near deficit conditions between 1999 and 2008, revenues generated in the cost evaluation period are applied toward repayment of deficits rather than repayment of project additions and replacements. All deficits are projected to be repaid by 2017.
Basis for Rate Development
The existing rates for P–SMBP—ED
firm power in Rate Schedule P–SED–
F10, which expire December 31, 2013,
no longer provide sufficient revenues to
pay all annual costs, including interest
expense, and repay investment and
irrigation aid within the allowable
period. The adjusted rates reflect
increases due to the financial impact of
the drought, increased annual expenses,
increased investments, and increased
interest expense associated with
investments and drought deficits. The
provisional rates will provide sufficient
revenue to pay all annual costs,
including interest expense, and repay
power investment and irrigation aid
within the allowable periods. The
provisional rates will take effect on the
first full billing period on or after
January 1, 2010, and will remain in
effect on an interim basis, pending
FERC’s confirmation and approval of
them or substitute rates on a final basis,
through December 31, 2014.
sroberts on DSKD5P82C1PROD with NOTICES
Comments
The comments and responses below
regarding the firm and firm peaking
electric service rates are paraphrased for
brevity when not affecting the meaning
of the statement(s). Direct quotes from
comment letters are used for
clarification when necessary.
A. Comment: One Customer
representative recognized the impacts
that the extended drought has had on
the current financial status of the P–
SMBP and stated that the repayment of
Federal investment through Federal
power rates is taken very seriously by
the Customers. This Customer
VerDate Nov<24>2008
17:33 Dec 17, 2009
Jkt 220001
representative also stated that, while
recent forecasts of Pick-Sloan generation
suggest improved revenues over those
projected when Western began this
public process, the customer
representative does not think it would
be appropriate for Western to attempt to
adjust its proposed rate in the middle of
this public process. The Customer
representative noted that, should
generation and revenues witness a
dramatic improvement, Western has the
capability to adjust the Drought Adder
up to 2 mills without going through a
full public process.
Response: Western acknowledges the
financial impact of the extended
drought and the need for a firm power
rate increase, as well. Western
recognizes the Firm Power Customer’s
serious commitment to power
repayment. Western agrees that it would
not be appropriate to adjust the
proposed rate in the middle of this
public process, but recognizes that it has
the ability to make subsequent changes
to the rate through the Drought Adder
in the event of changes in forecast
generation and revenues.
B. Comment: Two comments
indicated that rates were increased 22
percent last year by their electric co-op
serving the majority of Rosebud Sioux
Tribe (Tribe) members. The concern is
that an additional rate increase will
have a big impact on Tribal members.
One commenter stated the co-op will
disconnect Tribal member’s power even
in winter months, which can be lifethreatening. The LIEAP (Low Income
Energy Assistance Program) has
fluctuated up and down. Rosebud Sioux
Tribe Utilities Commission appreciates
PO 00000
Frm 00040
Fmt 4703
Sfmt 4703
the efforts of Western, but cannot afford
another rate increase. A position paper
was submitted to Western along with a
resolution passed by the Tribal council
supporting the position.
The position paper states that the
Rosebud Sioux Tribe, which is located
within Todd County and known to be
one of the 10 poorest counties in the
nation with an unemployment rate
above 80 percent, opposes and cannot
support the proposed firm electric 2010
rate adjustment. The position paper
further states that a rate increase would
directly affect Tribal members who have
signed up for the Tribal Bill Crediting
Program by decreasing the amount of
credit on monthly electric bills.
Response: Western acknowledges the
financial impacts of a firm power rate
increase and the poverty level which the
Tribe continues to endure. The criteria
for formulating a base rate is directly
related to Western’s costs and is not
determined by the end-users’ ability to
pay. Western is only a partial power
supplier to the co-op and may not be the
sole reason for a co-op rate increase.
Western believes that as water returns to
the Missouri River Basin and repayment
obligations are met, the Drought Adder
component of the rate will be reduced.
The Bill Crediting Program mentioned
is not directly related to this rate
adjustment. The Tribal benefit from the
Bill Crediting Program is derived from
the difference between Western’s
composite rate and the supplemental
power supplier’s composite rate. While
this rate adjustment will increase
Western’s composite rate, it is likely
that the composite rates for the
supplemental power suppliers will
E:\FR\FM\18DEN1.SGM
18DEN1
Federal Register / Vol. 74, No. 242 / Friday, December 18, 2009 / Notices
increase over time, and off-set the
impact of this rate increase.
C. Comment: One commenter
acknowledged that Western is working
with Basin Electric on an
interconnection agreement for a 100–
MW wind farm at Wessington Springs
or Winner. The commenter hopes
Western looks at the transmission
capacity and considers the proposed
Tribal wind farms. The Rosebud Sioux
Tribe was the recipient of a $1.5 million
grant from the Department of Energy for
renewable energy on Tribal homelands
and hopes Western will support their
economic efforts.
Response: This comment is not
directly related to the proposed firm
power rate action. As set forth in the
American Recovery and Reinvestment
Act of 2009, Western is actively
evaluating transmission proposals to
support renewable energy.
Availability of Information
Information about this rate
adjustment, including the PRS,
comments, letters, memorandums, and
other supporting materials that was
used to develop the provisional rates is
available for public review in the Upper
Great Plains Regional Office, Western
Area Power Administration, 2900 4th
Avenue North, Billings, Montana.
Ratemaking Procedure Requirements
Environmental Compliance
In compliance with the National
Environmental Policy Act (NEPA) of
1969 (42 U.S.C. 4321–4347); 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.
Submission to the Federal Energy
Regulatory Commission
The provisional 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 on
the first full billing period on or after
January 1, 2010, Rate Schedules P–SED–
F11 and P–SED–FP11 for the Pick-Sloan
Missouri Basin Program—Eastern
Division Project of the Western Area
Power Administration. These 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
December 31, 2014.
Dated: December 14, 2009.
Daniel B. Poneman,
Deputy Secretary of Energy.
Rate Schedule P–SED–F11
(Supersedes Schedule P–SED–F10)
January 1, 2010
67203
United States Department of Energy
Western Area Power Administration
Pick-Sloan Missouri Basin Program—
Eastern Division Montana, North
Dakota, South Dakota, Minnesota,
Iowa, Nebraska
Schedule of Rates for Firm Power
Service (Approved Under Rate Order
No. WAPA–147)
Effective: The first day of the first full
billing period beginning on or after
January 1, 2010, through December 31,
2014.
Available: Within the marketing area
served by the Eastern Division of the
Pick-Sloan Missouri Basin Program.
Applicable: To the power and energy
delivered to Customers as firm power
service.
Character: Alternating current, 60
hertz, three phase, delivered and
metered at the voltages and points
established by contract.
Monthly Rate:
Capacity Charge: $7.65 for each
kilowatt per month (kWmo) of billing
capacity.
Energy Charge: 19.05 mills for each
kilowatthour (kWh) for all energy
delivered as firm power service.
Billing Capacity: The billing capacity
will be as defined by the power sales
contract.
Charge Components:
Base: A fixed revenue requirement
that includes operation and
maintenance expense, investments and
replacements, interest on investments
and replacements, normal timing
purchase power (purchases due to
operational constraints, not associated
with drought), and transmission costs.
50% × Base Revenue Requirement
= $3.80 / kWmo
Firm Metered Billing Units
50% × Base Revenue Requirement
= 9.53 mills / kWh
Base Energy =
Annual Energy
Base Capacity =
Drought Adder: A formula-based
revenue requirement that includes
future purchase power above timing
purchases, previous purchase power
drought deficits, and interest on the
purchase power drought deficits.
50% × Drought Adder Revenue Requirement
= $3.85 / kWmo
Firm Metered Billing Units
50% × Drought Adder Revenue Requirement
= 9.52 mills/kWh
Drought Adder Energy =
Annual Energy
VerDate Nov<24>2008
17:33 Dec 17, 2009
Jkt 220001
The Drought Adder may be adjusted
annually using the above formulas for
any costs attributed to drought of less
than or equal to the equivalent of 2
PO 00000
Frm 00041
Fmt 4703
Sfmt 4703
mills/kWh to the Power Repayment
Study composite rate. Any planned
incremental adjustment to the Drought
Adder greater than the equivalent of 2
E:\FR\FM\18DEN1.SGM
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EN18DE09.428</GPH>
Process: Any proposed change to the
Base component will require a public
process.
EN18DE09.427</GPH>
sroberts on DSKD5P82C1PROD with NOTICES
Drought Adder Capacity =
Federal Register / Vol. 74, No. 242 / Friday, December 18, 2009 / Notices
Base Capacity =
Drought Adder: A formula-based
revenue requirement that includes
sroberts on DSKD5P82C1PROD with NOTICES
Process: Any proposed change to the
Base component will require a public
process.
The Drought Adder may be adjusted
annually using the above formula for
any costs attributed to drought of less
than or equal to the equivalent of 2
mills/kWh to the Power Repayment
Study composite rate. Any planned
incremental adjustment to the Drought
Adder greater than the equivalent of 2
mills/kWh to the PRS composite rate
will require a public process.
Billing Capacity: The billing capacity
will be the greater of (1) the highest 30minute integrated capacity measured
during the month up to, but not in
excess of, the delivery obligation under
the power sales contract, or (2) the
contract rate of delivery.
Adjustments:
Billing for Unauthorized Overruns:
For each billing period in which there
is a contract violation involving an
unauthorized overrun of the contractual
obligation for peaking capacity and/or
17:33 Dec 17, 2009
Jkt 220001
United States Department of Energy
Western Area Power Administration
Pick-Sloan Missouri Basin Program—
Eastern Division Montana, North
Dakota, South Dakota, Minnesota,
Iowa, Nebraska
Schedule of Rates for Firm Peaking
Power Service (Approved Under Rate
Order No. WAPA–147)
Effective: The first day of the first full
billing period beginning on or after
January 1, 2010, through December 31,
2014.
Available: Within the marketing area
served by the Eastern Division of the
Pick-Sloan Missouri Basin Program, to
our Customers with generating
resources enabling them to use firm
peaking power service.
Applicable: To the power sold to
Customers as firm peaking power
service.
Character: Alternating current, 60
hertz, three phase, delivered and
metered at the voltages and points
established by contract.
Monthly Rate:
Capacity Charge: $6.90 for each
kilowatt per month (kWmo) of the
effective contract rate of delivery for
peaking power or the maximum amount
scheduled, whichever is greater.
Energy Charge: 19.05 mills for each
kilowatthour (kWh) for all energy
scheduled for delivery without return.
Charge Components:
Base: A fixed revenue requirement
that includes operation and
maintenance expense, investment and
replacements, normal timing purchase
power (purchases due to operational
constraints, not associated with
drought), and transmission costs.
Base Peaking Capacity Revenue Requirement
= $3.45 / kWmo
Peaking CROD Billing Units
k
future purchase power above timing
purchases, previous purchase power
Drought Adder Capacity =
VerDate Nov<24>2008
between 95-percent lagging and 95percent leading.
Rate Schedule P–SED–FP11
(Supersedes Schedule P–SED–FP10)
January 1, 2010
drought deficits, and interest on the
purchase power drought deficits.
Drought Adder Peaking Capacity Revenue Requirement
= $3.45 / kWmo
Peaking CROD Billing Units
energy, such overrun shall be billed at
10 times the above rate.
[FR Doc. E9–30149 Filed 12–17–09; 8:45 am]
BILLING CODE 6450–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
[Docket No. ER10–397–000]
Cesarie, Inc.; Supplemental Notice
That Initial Market-Based Rate Filing
Includes Request for Blanket Section
204 Authorization
December 10, 2009.
This is a supplemental notice in the
above-referenced proceeding of Cesarie,
Inc.’s application for market-based rate
authority, with an accompanying rate
tariff, noting that such application
includes a request for blanket
authorization, under 18 CFR Part 34, of
future issuances of securities and
assumptions of liability.
PO 00000
Frm 00042
Fmt 4703
Sfmt 4703
Any person desiring to intervene or to
protest should file with the Federal
Energy Regulatory Commission, 888
First Street, NE., Washington, DC 20426,
in accordance with Rules 211 and 214
of the Commission’s Rules of Practice
and Procedure (18 CFR 385.211 and
385.214). Anyone filing a motion to
intervene or protest must serve a copy
of that document on the Applicant.
Notice is hereby given that the
deadline for filing protests with regard
to the applicant’s request for blanket
authorization, under 18 CFR Part 34, of
future issuances of securities and
assumptions of liability, is December 30,
2009.
The Commission encourages
electronic submission of protests and
interventions in lieu of paper, using the
FERC Online links at https://
www.ferc.gov. To facilitate electronic
service, persons with Internet access
who will eFile a document and/or be
listed as a contact for an intervenor
must create and validate an
eRegistration account using the
eRegistration link. Select the eFiling
E:\FR\FM\18DEN1.SGM
18DEN1
EN18DE09.426</GPH>
mills/kWh to the PRS composite rate
will require a public process.
Adjustments:
For Character and Conditions of
Service: Customers who receive
deliveries at transmission voltage may
in some instances be eligible to receive
a 5-percent discount on capacity and
energy charges when facilities are
provided by the Customer that results in
a sufficient savings to Western to justify
the discount. The determination of
eligibility for receipt of the voltage
discount shall be exclusively vested in
Western.
For Billing of Unauthorized Overruns:
For each billing period in which there
is a contract violation involving an
unauthorized overrun of the contractual
firm power and/or energy obligations,
such overrun shall be billed at 10 times
the above rate.
For Power Factor: None. The
Customer will be required to maintain a
power factor at the point of delivery
EN18DE09.425</GPH>
67204
]]>Agencies
[Federal Register Volume 74, Number 242 (Friday, December 18, 2009)]
[Notices]
[Pages 67197-67204]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-30149]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Western Area Power Administration
Pick-Sloan Missouri Basin Program--Eastern Division--Rate Order
No. WAPA-147
AGENCY: Western Area Power Administration, DOE.
ACTION: Notice of Order Concerning Firm Power Rates.
-----------------------------------------------------------------------
SUMMARY: The Deputy Secretary of Energy confirmed and approved Rate
Order No. WAPA-147 and Rate Schedules P-SED-F11 and P-SED-FP11, placing
firm power and firm peaking power rates from the Pick-Sloan Missouri
Basin Program--Eastern Division (P-SMBP--ED) of the Western Area Power
Administration (Western) into effect on an interim basis. The
provisional rates will be in effect until the Federal Energy Regulatory
Commission (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 power investments and irrigation
aid within the allowable periods.
DATES: Rate Schedules P-SED-F11 and P-SED-FP11 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, 2010, and will remain in effect
until FERC confirms, approves, and places the rate schedules in effect
on a final basis ending December 31, 2014, or until the rate schedules
are superseded.
FOR FURTHER INFORMATION CONTACT: Mr. Robert J. Harris, Regional
Manager, Upper Great Plains Region, Western Area Power Administration,
2900 4th
[[Page 67198]]
Avenue North, Billings, MT 59101-1266, telephone (406) 247-7405, e-mail
rharris@wapa.gov, or Ms. Linda Cady-Hoffman, Rates Manager, Upper Great
Plains Region, Western Area Power Administration, 2900 4th Avenue
North, Billings, MT 59101-1266, (406) 247-7439, e-mail cady@wapa.gov.
SUPPLEMENTARY INFORMATION: The Acting Deputy Secretary of Energy
approved existing Rate Schedules P-SED-F10 and P-SED-FP10 for P-SMBP--
ED firm and firm peaking electric service, respectively, on an interim
basis on January 8, 2009 (74 FR 3022, January 16, 2009), for a 5-year
period beginning on February 1, 2009, and ending December 31, 2013.\1\
---------------------------------------------------------------------------
\1\ FERC confirmed and approved Rate Order No. WAPA-140 on April
28, 2009, in Docket No. EF09-5031-000. See United States Department
of Energy, Western Area Power Administration, Pick-Sloan Missouri
Basin Program, 127 FERC ] 62,075.
---------------------------------------------------------------------------
Under Rate Schedule P-SED-F10, the composite rate is 29.34 mills
per kilowatthour (mills/kWh), the firm energy rate is 16.71 mills/kWh,
and the firm capacity rate is $6.80 per kilowattmonth (kWmonth). Under
Rate Schedule P-SED-FP10, the firm peaking capacity rate is $6.20/
kWmonth. These Rate Schedules are formula based with Base and Drought
Adder components and provide for an up to 2 mills/kWh increase in the
Drought Adder component.
The current rate adjustment reflects a rate increase based on the
P-SMBP Final Fiscal Year (FY) 2008 Power Repayment Study (PRS). The PRS
sets the total annual P-SMBP--ED revenue requirement for 2010 for firm
and firm peaking electric service at $320.2 million, or a 13.1 percent
increase. The current rates, including the 2 mills/kWh increase
provided for under the Drought Adder formula rate component, are not
sufficient to meet the P-SMBP--ED revenue requirements.
The P-SMBP--ED revenue requirement increase is mainly attributed to
the financial impacts of the drought. A decrease in hydro-power
generation has caused purchase power expenses to increase and revenue
from non-firm energy sales to decrease. There has been an increase in
both the price and volume of purchase power needed to meet contractual
commitments to Western's Customers. The purchase price of power is set
by supply and demand on the open market.
The existing firm electric service Rate Schedules P-SED-F10 and P-
SED-FP10 are being superseded by Rate Schedules P-SED-F11 and P-SED-
FP11, respectively. Under Rate Schedule P-SED-F11, the provisional
rates for firm electric services will result in a combined composite
rate of 33.25 mills/kWh. The energy rate will be 19.05 mills/kWh (a
Base component of 9.53 mills/kWh and a Drought Adder component of 9.52
mills/kWh), and the capacity rate will be $7.65/kWmonth (a Base
component of $3.80/kWmonth and a Drought Adder component of $3.85/
kWmonth). Under Rate Schedule P-SED-FP11, the provisional rates for
firm peaking electric services consist of a capacity charge of $6.90/
kWmonth (a Base component of $3.45/kWmonth and a Drought Adder
component of $3.45/kWmonth) and an energy charge of 19.05 mills/kWh (a
Base component of 9.53 mills/kWh and a Drought Adder component of 9.52
mills/kWh).
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 the Administrator of Western; (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 Department of Energy (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, 10 CFR part
903, and 18 CFR part 300, I hereby confirm, approve, and place Rate
Order No. WAPA-147, the proposed P-SMBP--ED firm power, and firm
peaking power rates into effect on an interim basis.
The new Rate Schedules P-SED-F11 and P-SED-FP11 will be promptly
submitted to FERC for confirmation and approval on a final basis.
Dated: December 14, 2009.
Daniel B. Poneman,
Deputy Secretary of Energy.
Department of Energy Deputy Secretary
In the matter of: Western Area Power Administration Rate Adjustment
for the Pick-Sloan Missouri Basin Program--Eastern Division; Rate Order
No. WAPA-147; Order Confirming, Approving, and Placing the Pick-Sloan
Missouri Basin Program--Eastern Division Firm Power and Firm Peaking
Power Service Rates into Effect on an Interim Basis.
The firm and firm peaking electric service rates for the Pick-Sloan
Missouri Basin Program--Eastern Division were 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 section 5 of the Flood Control Act
of 1944 (16 U.S.C. 825s) 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 the Administrator of Western; (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 Federal Energy Regulatory Commission
(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.
Base: Revenue requirement component of the power rate including
annual operation and maintenance expenses, investment repayment and
associated interest, normal timing power purchases, and transmission
costs.
Capacity: The electric capability of a generator, transformer,
transmission circuit, or other equipment. It is expressed in
kilowatts.
Capacity Charge: The rate which sets forth the charges for
capacity. It is expressed in dollars per kilowattmonth.
Composite Rate: The rate for commercial firm power which is the
total annual revenue requirement for capacity and energy divided by
the total annual energy sales. It is expressed in mills per
kilowatthour and used for comparison purposes.
CROD: Contract Rate of Delivery. The maximum amount of capacity
and energy allocated to a preference Customer for a period specified
under a contract.
Customer: An entity with a contract that is receiving service
from Western's Upper Great Plains Region.
Deficits: Deferred or unrecovered annual and/or interest
expenses.
DOE: United States Department of Energy.
DOE Order RA 6120.2: An order outlining power marketing
administration financial reporting and rate-making procedures.
[[Page 67199]]
Drought Adder: Formula-based revenue requirement component
including costs associated with the drought.
Energy: Measured in terms of the work it is capable of doing
over a period of time. It is expressed in kilowatthours.
Energy Charge: The rate which sets forth the charges for energy.
It is expressed in mills per kilowatthour and applied to each
kilowatthour delivered to each Customer.
FERC: Federal Energy Regulatory Commission.
Firm: A type of product and/or service available at the time
requested by the Customer.
FRN: Federal Register notice.
Fry-Ark: Fryingpan-Arkansas Project.
FY: Fiscal year; October 1 to September 30.
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.
LAP: Loveland Area Projects.
mills/kWh: Mills per kilowatthour--the unit of charge for energy
(equal to one tenth of a cent or one thousandth of a dollar).
MW: Megawatt--the electrical unit of capacity that equals 1
million watts or 1,000 kilowatts.
NEPA: National Environmental Policy Act of 1969 (42 U.S.C. 4321-
4347 (2003)).
Non-timing Power Purchases: Power purchases that are not related
to operational constraints such as management of endangered species,
species habitat, water quality, navigation, control area purposes,
etc.
O&M: Operation and Maintenance.
P-SMBP: The Pick-Sloan Missouri Basin Program.
P-SMBP-ED: Pick-Sloan Missouri Basin Program--Eastern Division.
P-SMBP-WD: Pick-Sloan Missouri Basin Program--Western Division.
Power: Capacity and energy.
Power Factor: The ratio of real to apparent power at any given
point and time in an electrical circuit. Generally, it is expressed
as a percentage.
Preference: The provisions of Reclamation Law which require
Western to first make Federal power available to certain entities.
For example, section 9(c) of the Reclamation Project Act of 1939 (43
U.S.C. 485h(c)) states that preference in the sale of Federal power
shall be given to municipalities and other public corporations or
agencies and also to cooperatives and other nonprofit organizations
financed in whole or in part by loans made under the Rural
Electrification Act of 1936.
Provisional Rate: A rate which has been confirmed, approved, and
placed into effect on an interim basis by the Deputy Secretary of
Energy.
PRS: Power Repayment Study.
Rate Brochure: A July 2009 document explaining the rationale and
background for the rate proposal contained in this Rate Order.
Reclamation: The United States Department of the Interior,
Bureau of Reclamation.
Reclamation Law: A series of Federal laws that contain the
framework under which Western markets power.
Revenue Requirement: The revenue required to recover annual
expenses (such as O&M, purchase power, transmission service
expenses, interest, and deferred expenses) and repay Federal
investments and other assigned costs.
RMR: The Rocky Mountain Customer Service Region of the Western
Area Power Administration.
UGPR: The Upper Great Plains Customer Service Region of the
Western Area Power Administration.
Western: The 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 January 1, 2010, and
will remain in effect until December 31, 2014, 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. The proposed rate adjustment process began March 17, 2009, when
Western's UGPR mailed a notice announcing informal Customer meetings to
all P-SMBP-ED preference Customers and interested parties. The informal
meetings were held on April 15, 2009, in Sioux Falls, South Dakota, and
on April 16, 2009, in Northglenn, Colorado. At these informal meetings,
Western explained the rationale for the rate adjustment, presented rate
designs and methodologies, and answered questions.
2. A Federal Register notice, published on July 14, 2009 (74 FR
34012), announced the proposed rates for P-SMBP-ED, began a public
consultation and comment period and announced the public information
and public comment forums.
3. On July 14, 2009, Western mailed letters to all P-SMBP-ED
preference Customers and interested parties transmitting the FRN
published on July 14, 2009.
4. On August 18, 2009, at 9 a.m. (MDT), Western held a public
information forum at the Ramada Plaza Hotel in Northglenn, Colorado.
Western provided updates to the proposed firm power rates for the P-
SMBP, which encompasses the P-SMBP-ED and LAP rates. Western also
answered questions and gave notice that more information was available
in the rate brochure.
5. On August 18, 2009, at 11 a.m. (MDT), following the public
information forum, at the same location, a public comment forum was
held. The comment forum gave the public an opportunity to comment for
the record. No oral or written comments were received at this forum.
6. On August 19, 2009, at 9 a.m. (CDT), Western held a public
information forum at the Holiday Inn in Sioux Falls, South Dakota.
Western provided updates to the proposed firm power rates for the P-
SMBP-ED. Western also answered questions and gave notice that more
information was available in the rate brochure.
7. On August 19, 2009, at 11 a.m. (CDT), following the public
information forum, and at the same location, a public comment forum was
held. The comment forum gave the public an opportunity to comment for
the record. Two oral comments and two exhibits were received at this
forum.
8. Western provided a website which contains all of the letters,
time frames, dates, and locations of forums, documents discussed at the
information meetings, FRNs, rate brochure, and all other information
about this rate process for easy Customer access. The Web site is
located at https://www.wapa.gov/ugp/rates/2010FirmRateAdjust.
9. During the consultation and comment period, which ended October
13, 2009, Western received one comment letter.
All comments received have been considered in preparing this Rate
Order.
Comments
Written comment was received from the following organization: Mid-
West Electric Consumers Association, Colorado.
Two representatives of the following organization made oral
comments and submitted exhibits: Rosebud Sioux Tribe's Utilities
Commission, South Dakota.
Project Description
The P-SMBP was authorized by Congress in Section 9 of the Flood
Control Act of December 22, 1944, commonly referred to as the Flood
Control Act of 1944. This multipurpose program provides flood control,
irrigation, navigation, recreation, preservation and enhancement of
fish and wildlife, and power generation. Multipurpose projects have
been developed on the Missouri River and its tributaries in Colorado,
Montana, Nebraska, North Dakota, South Dakota, and Wyoming.
In addition to the multipurpose water projects authorized by
Section 9 of the
[[Page 67200]]
Flood Control Act of 1944, certain other existing projects have been
integrated with the P-SMBP for power marketing, operation, and
repayment purposes. The Colorado-Big Thompson, Kendrick, and Shoshone
Projects were combined with the P-SMBP in 1954, followed by the North
Platte Project in 1959. These projects are referred to as the
``Integrated Projects'' of the P-SMBP.
The Flood Control Act of 1944 also authorized the inclusion of the
Fort Peck Project with the P-SMBP for operation and repayment purposes.
The Riverton Project was integrated with the P-SMBP in 1954 and in 1970
was reauthorized as a unit of P-SMBP.
The P-SMBP is administered by two regions. The UGPR, with a
regional office in Billings, Montana, markets power from the Eastern
Division of P-SMBP, and the RMR, with a regional office in Loveland,
Colorado, markets the Western Division power of P-SMBP. The UGPR
markets power in western Iowa, western Minnesota, Montana east of the
Continental Divide, North Dakota, South Dakota, and the eastern two-
thirds of Nebraska. The RMR markets P-SMBP--WD power, which in
combination with Fry-Ark power is known as LAP power, in northeastern
Colorado, east of the Continental Divide in Wyoming, west of the 101st
meridian in Nebraska, and most of Kansas. The P-SMBP power is marketed
to approximately 300 firm power Customers by the UGPR and approximately
54 firm power Customers by the RMR.
Power Repayment Study--Firm Power Rate
Western prepares a PRS each FY to determine if revenues will be
sufficient to repay, within the required time, all costs assigned to
the P-SMBP. Repayment criteria are based on Western's applicable laws
and legislation, as well as policies including DOE Order RA 6120.2. To
meet Cost Recovery Criteria outlined in DOE Order RA 6120.2, a revised
study and rate adjustment has been developed to demonstrate that
sufficient revenues will be collected under proposed rates to meet
future obligations.
Existing and Provisional Rates
Eastern Division
Under Rate Schedule P-SED-F10, the composite rate is 29.34 mills/
kWh, the firm energy rate is 16.71 mills/kWh, and the firm capacity
rate is $6.80/kWmonth. For Rate Schedule P-SED-FP10 the firm peaking
capacity rate is $6.20/kWmonth. These Rate Schedules are formula based
with Base and Drought Adder components and provide for up to a 2 mills/
kWh increase in the Drought Adder component.
The current rate adjustment reflects a rate increase based on the
P-SMBP FY 2008 PRS. The PRS sets the total annual P-SMBP--ED revenue
requirement for FY 2010 for firm and firm peaking electric service at
$320.2 million, or a 13.1 percent increase.
A comparison of the existing and provisional firm power and firm
peaking power rates follow:
Table 1--Comparison of Existing and Provisional Rates Pick-Sloan Missouri Basin Program--Eastern Division
----------------------------------------------------------------------------------------------------------------
Current rates Provisional rates
Firm electric service -------------------------------------- Percent
P-SED-F10/P-SED- P-SED-F11/P-SED- change
-----------------------------------------------------------------------FP10---------------FP11------------------
Rate Schedules:
Firm and Firm Peaking Revenue Requirement (million)....... $283.0 $320.2 13.1
Composite Rate (mills/kWh)................................ 29.34 33.25 13.3
Firm Capacity Rate (/kWmonth)............................. $6.80 $7.65 12.5
Firm Energy Rate (mills/kWh).............................. 16.71 19.05 14.0
Firm Peaking Capacity Rate (/kWmonth)..................... $6.20 $6.90 11.3
Firm Peaking Energy Rate (mills/kWh) \1\.................. 16.71 19.05 14.0
----------------------------------------------------------------------------------------------------------------
\1\ Firm Peaking Energy is normally returned. This rate will be assessed in the event Firm Peaking Energy is not
returned.
Western Division
The LAP rate is designed to recover the P-SMBP--WD revenue
requirement for the P-SMBP and the revenue requirement for Fry-Ark. The
adjustment to the LAP rate is a separate formal rate process which is
documented in Rate Order No. WAPA-146. Rate Order No. WAPA-146 is also
scheduled to go into effect on the first day of the first full billing
period on or after January 1, 2010.
Certification of Rates
Western's Administrator certified that the provisional rates for P-
SMBP--ED firm power and firm peaking power rates under Rate Schedules
P-SED-F11 and P-SED-FP11 are the lowest possible rates consistent with
sound business principles. The provisional rates were developed
following administrative policies and applicable laws.
P-SMBP--ED Firm Power Rate Discussion
Western is required to establish power rates sufficient to recover
operation, maintenance, purchased power and interest expenses, and
repay power investment and irrigation aid.
The P-SMBP-ED firm power and firm peaking power rates must be
increased due to the financial impact of the drought, increased annual
expenses, increased investments, and increased interest expenses
associated with debt.
Under Rate Schedule P-SED-F11, Western will continue identifying
its firm electric service revenue requirement using Base and Drought
Adder components. The Base component is a fixed revenue requirement
that includes annual O&M expenses, investment repayment and associated
interest, normal timing power purchases, and transmission costs.
Western's normal timing power purchases are due to operational
constraints (e.g., management of endangered species habitat, water
quality, navigation, etc.) and are not associated with drought. The
Base component cannot be adjusted by Western without a public process.
The Drought Adder component is a formula-based revenue requirement
that includes costs attributable to drought conditions within the P-
SMBP. The Drought Adder component includes costs associated with future
non-timing power purchases to meet firm power contractual obligations
not covered with available system generation due to the drought,
previously incurred deficits due to purchased power debt that resulted
from non-timing power
[[Page 67201]]
purchases made during this drought, and the interest associated with
drought debt. The Drought Adder component is designed to repay
Western's drought debt within 10 years from the time the debt was
incurred, using balloon-payment methodology. For example, the drought
debt incurred by Western in FY 2008 will be repaid by FY 2018.
The annual revenue requirement calculation will continue to be
summarized by the following formula: Annual Revenue Requirement = Base
Revenue Requirement + Drought Adder Revenue Requirement. Under this
provisional rate, the P-SMBP-ED annual revenue requirement equals
$332.8 million and is comprised of a Base revenue requirement of $166
million plus a Drought Adder revenue requirement of $166.8 million.
Both the Base and Drought Adder components recover portions of the firm
power revenue requirement, firm peaking power, and associated 5 percent
discount revenue necessary to equal the P-SMBP-ED revenue requirement.
A comparison of the current and proposed rate components are listed in
Table 2.
Table 2--Summary of P-SMBP--ED Rate Components
----------------------------------------------------------------------------------------------------------------
Existing rates P-SED-F10/P-SED- Provisional rates P-SED-F11/P-SED-
----------------FP10--------------------------------FP11---------------
Drought Drought
Base adder Total Base adder Total
component component component component
----------------------------------------------------------------------------------------------------------------
Firm Capacity Rate (/kWmonth)........... $3.80 $3.00 $6.80 $3.80 $3.85 $7.65
Firm Energy Rate (mills/kWh)............ 9.27 7.44 16.71 9.53 9.52 19.05
Firm Peaking Capacity Rate (/kWmonth)... $3.40 $2.80 $6.20 $3.45 $3.45 $6.90
Firm Peaking Energy Rate (mills/kWh) \1\ 9.27 7.44 16.71 9.53 9.52 19.05
----------------------------------------------------------------------------------------------------------------
\1\ Firm peaking energy is normally returned. This will be assessed in the event firm peaking energy is not
returned.
As set forth in Table 2 above, provisional Rate Schedule P-SED-F11
has a firm capacity rate of $7.65/kWmonth and a firm energy rate of
19.05 mills/kWh. Under Rate Schedule P-SED-FP11, the firm peaking
capacity rate will increase to $6.90/kWmonth, or an 11 percent
increase. Peaking energy is either returned to Western or paid for in
accordance with the terms of the contract between Western and the
peaking power Customer.
Continuing to identify the firm electric service revenue
requirement using Base and Drought Adder components will assist Western
in presenting the effects of the drought within the P-SMBP,
demonstrating repayment of the drought related costs, and allow Western
to be more responsive to changes in drought related expenses. Western
will continue to charge and bill Customers firm electric service rates
for energy and capacity, which are the sum of the Base and Drought
Adder components.
Western reviews its firm electric service rates annually. Western
will review the Base component after the annual PRS is completed,
generally in the first quarter of the calendar year. If an adjustment
to the Base component is necessary, Western will initiate a public
process pursuant to 10 CFR part 903 prior to making an adjustment.
In accordance with the original implementation of the Drought Adder
component, Western will continue to review the Drought Adder component
each September to determine if drought costs differ from those
projected in the PRS. If drought costs differ, Western will determine
if an adjustment to the Drought Adder component is necessary. Western
will notify Customers by letter each October of the planned incremental
or decremental adjustment and implement the adjustment in the January
billing cycle. Although decremental adjustments to the Drought Adder
component will occur as drought costs are repaid, the adjustments
cannot result in a negative Drought Adder component. To give Customers
advance notice, Western will conduct a preliminary review of the
Drought Adder component in early summer and notify Customers by letter
of the estimated change to the Drought Adder component for the
following January. Western will verify the final Drought Adder
component adjustment by notification in the October letter to the
Customers. Implementing the Drought Adder component adjustment on
January 1 of each year will help keep the drought deficits from
escalating as quickly, will lower the interest expense due to drought
deficits, will demonstrate responsible deficit management, and will
provide prompt drought deficit repayments.
Western's current and provisional rate schedules provide for a
formula-based adjustment of the Drought Adder component of up to 2
mills/kWh. The 2 mills/kWh cap is intended to place a limit on the
amount the Drought Adder formula can be adjusted relative to associated
drought costs without initiating a public process to recover costs
attributable to the Drought Adder formula rate for any one-year cycle.
Statement of Revenue and Related Expenses
The following Table 3 provides a summary of projected revenue and
expense data for the total P-SMBP, including both the Eastern and
Western Divisions, firm electric service revenue requirement through
the 5-year rate approval period.
The firm power rates for both divisions have been developed with
the following revenues and expenses for the P-SMBP:
Table 3--Total P-SMBP Firm Power Comparison of 5-Year Rate Period (FY 2010-2014)
[Total revenues and expenses]
----------------------------------------------------------------------------------------------------------------
Current rate Provisional Difference
($000) rate ($000) ($000)
----------------------------------------------------------------------------------------------------------------
Total Revenues.................................................. $2,417,497 $2,625,336 $207,839
Revenue Distribution
Expenses:
[[Page 67202]]
O&M......................................................... 859,559 904,884 45,325
Purchased Power............................................. 431,180 440,038 8,858
Interest.................................................... 639,356 650,671 11,315
Transmission................................................ 65,963 65,853 (110)
-----------------------------------------------
Total Expenses.......................................... 1,996,058 2,061,446 65,388
===============================================
Principal Payments:
Capitalized Expenses (Deficits) \1\............................. 351,517 483,252 131,735
Original Project and Additions \1\.......................... 1,546 10,414 8,868
Replacements \1\............................................ 2,704 4,825 2,121
Irrigation Aid.............................................. 65,672 65,399 (273)
-----------------------------------------------
Total Principal Payments................................ 421,439 563,890 142,451
===============================================
Total Revenue Distribution.......................... 2,417,497 2,625,336 207,839
----------------------------------------------------------------------------------------------------------------
\1\ Due to the deficit or near deficit conditions between 1999 and 2008, revenues generated in the cost
evaluation period are applied toward repayment of deficits rather than repayment of project additions and
replacements. All deficits are projected to be repaid by 2017.
Basis for Rate Development
The existing rates for P-SMBP--ED firm power in Rate Schedule P-
SED-F10, which expire December 31, 2013, no longer provide sufficient
revenues to pay all annual costs, including interest expense, and repay
investment and irrigation aid within the allowable period. The adjusted
rates reflect increases due to the financial impact of the drought,
increased annual expenses, increased investments, and increased
interest expense associated with investments and drought deficits. The
provisional rates will provide sufficient revenue to pay all annual
costs, including interest expense, and repay power investment and
irrigation aid within the allowable periods. The provisional rates will
take effect on the first full billing period on or after January 1,
2010, and will remain in effect on an interim basis, pending FERC's
confirmation and approval of them or substitute rates on a final basis,
through December 31, 2014.
Comments
The comments and responses below regarding the firm and firm
peaking electric service rates are paraphrased for brevity when not
affecting the meaning of the statement(s). Direct quotes from comment
letters are used for clarification when necessary.
A. Comment: One Customer representative recognized the impacts that
the extended drought has had on the current financial status of the P-
SMBP and stated that the repayment of Federal investment through
Federal power rates is taken very seriously by the Customers. This
Customer representative also stated that, while recent forecasts of
Pick-Sloan generation suggest improved revenues over those projected
when Western began this public process, the customer representative
does not think it would be appropriate for Western to attempt to adjust
its proposed rate in the middle of this public process. The Customer
representative noted that, should generation and revenues witness a
dramatic improvement, Western has the capability to adjust the Drought
Adder up to 2 mills without going through a full public process.
Response: Western acknowledges the financial impact of the extended
drought and the need for a firm power rate increase, as well. Western
recognizes the Firm Power Customer's serious commitment to power
repayment. Western agrees that it would not be appropriate to adjust
the proposed rate in the middle of this public process, but recognizes
that it has the ability to make subsequent changes to the rate through
the Drought Adder in the event of changes in forecast generation and
revenues.
B. Comment: Two comments indicated that rates were increased 22
percent last year by their electric co-op serving the majority of
Rosebud Sioux Tribe (Tribe) members. The concern is that an additional
rate increase will have a big impact on Tribal members. One commenter
stated the co-op will disconnect Tribal member's power even in winter
months, which can be life-threatening. The LIEAP (Low Income Energy
Assistance Program) has fluctuated up and down. Rosebud Sioux Tribe
Utilities Commission appreciates the efforts of Western, but cannot
afford another rate increase. A position paper was submitted to Western
along with a resolution passed by the Tribal council supporting the
position.
The position paper states that the Rosebud Sioux Tribe, which is
located within Todd County and known to be one of the 10 poorest
counties in the nation with an unemployment rate above 80 percent,
opposes and cannot support the proposed firm electric 2010 rate
adjustment. The position paper further states that a rate increase
would directly affect Tribal members who have signed up for the Tribal
Bill Crediting Program by decreasing the amount of credit on monthly
electric bills.
Response: Western acknowledges the financial impacts of a firm
power rate increase and the poverty level which the Tribe continues to
endure. The criteria for formulating a base rate is directly related to
Western's costs and is not determined by the end-users' ability to pay.
Western is only a partial power supplier to the co-op and may not be
the sole reason for a co-op rate increase. Western believes that as
water returns to the Missouri River Basin and repayment obligations are
met, the Drought Adder component of the rate will be reduced.
The Bill Crediting Program mentioned is not directly related to
this rate adjustment. The Tribal benefit from the Bill Crediting
Program is derived from the difference between Western's composite rate
and the supplemental power supplier's composite rate. While this rate
adjustment will increase Western's composite rate, it is likely that
the composite rates for the supplemental power suppliers will
[[Page 67203]]
increase over time, and off-set the impact of this rate increase.
C. Comment: One commenter acknowledged that Western is working with
Basin Electric on an interconnection agreement for a 100-MW wind farm
at Wessington Springs or Winner. The commenter hopes Western looks at
the transmission capacity and considers the proposed Tribal wind farms.
The Rosebud Sioux Tribe was the recipient of a $1.5 million grant from
the Department of Energy for renewable energy on Tribal homelands and
hopes Western will support their economic efforts.
Response: This comment is not directly related to the proposed firm
power rate action. As set forth in the American Recovery and
Reinvestment Act of 2009, Western is actively evaluating transmission
proposals to support renewable energy.
Availability of Information
Information about this rate adjustment, including the PRS,
comments, letters, memorandums, and other supporting materials that was
used to develop the provisional rates is available for public review in
the Upper Great Plains Regional Office, Western Area Power
Administration, 2900 4th Avenue North, Billings, Montana.
Ratemaking Procedure Requirements
Environmental Compliance
In compliance with the National Environmental Policy Act (NEPA) of
1969 (42 U.S.C. 4321-4347); 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.
Submission to the Federal Energy Regulatory Commission
The provisional 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 on the first full
billing period on or after January 1, 2010, Rate Schedules P-SED-F11
and P-SED-FP11 for the Pick-Sloan Missouri Basin Program--Eastern
Division Project of the Western Area Power Administration. These 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 December 31, 2014.
Dated: December 14, 2009.
Daniel B. Poneman,
Deputy Secretary of Energy.
Rate Schedule P-SED-F11
(Supersedes Schedule P-SED-F10)
January 1, 2010
United States Department of Energy Western Area Power Administration
Pick-Sloan Missouri Basin Program--Eastern Division Montana, North
Dakota, South Dakota, Minnesota, Iowa, Nebraska
Schedule of Rates for Firm Power Service (Approved Under Rate Order No.
WAPA-147)
Effective: The first day of the first full billing period beginning
on or after January 1, 2010, through December 31, 2014.
Available: Within the marketing area served by the Eastern Division
of the Pick-Sloan Missouri Basin Program.
Applicable: To the power and energy delivered to Customers as firm
power service.
Character: Alternating current, 60 hertz, three phase, delivered
and metered at the voltages and points established by contract.
Monthly Rate:
Capacity Charge: $7.65 for each kilowatt per month (kWmo) of
billing capacity.
Energy Charge: 19.05 mills for each kilowatthour (kWh) for all
energy delivered as firm power service.
Billing Capacity: The billing capacity will be as defined by the
power sales contract.
Charge Components:
Base: A fixed revenue requirement that includes operation and
maintenance expense, investments and replacements, interest on
investments and replacements, normal timing purchase power (purchases
due to operational constraints, not associated with drought), and
transmission costs.
[GRAPHIC] [TIFF OMITTED] TN18DE09.427
Drought Adder: A formula-based revenue requirement that includes
future purchase power above timing purchases, previous purchase power
drought deficits, and interest on the purchase power drought deficits.
[GRAPHIC] [TIFF OMITTED] TN18DE09.428
Process: Any proposed change to the Base component will require a
public process.
The Drought Adder may be adjusted annually using the above formulas
for any costs attributed to drought of less than or equal to the
equivalent of 2 mills/kWh to the Power Repayment Study composite rate.
Any planned incremental adjustment to the Drought Adder greater than
the equivalent of 2
[[Page 67204]]
mills/kWh to the PRS composite rate will require a public process.
Adjustments:
For Character and Conditions of Service: Customers who receive
deliveries at transmission voltage may in some instances be eligible to
receive a 5-percent discount on capacity and energy charges when
facilities are provided by the Customer that results in a sufficient
savings to Western to justify the discount. The determination of
eligibility for receipt of the voltage discount shall be exclusively
vested in Western.
For Billing of Unauthorized Overruns: For each billing period in
which there is a contract violation involving an unauthorized overrun
of the contractual firm power and/or energy obligations, such overrun
shall be billed at 10 times the above rate.
For Power Factor: None. The Customer will be required to maintain a
power factor at the point of delivery between 95-percent lagging and
95-percent leading.
Rate Schedule P-SED-FP11
(Supersedes Schedule P-SED-FP10)
January 1, 2010
United States Department of Energy Western Area Power Administration
Pick-Sloan Missouri Basin Program--Eastern Division Montana, North
Dakota, South Dakota, Minnesota, Iowa, Nebraska
Schedule of Rates for Firm Peaking Power Service (Approved Under Rate
Order No. WAPA-147)
Effective: The first day of the first full billing period beginning
on or after January 1, 2010, through December 31, 2014.
Available: Within the marketing area served by the Eastern Division
of the Pick-Sloan Missouri Basin Program, to our Customers with
generating resources enabling them to use firm peaking power service.
Applicable: To the power sold to Customers as firm peaking power
service.
Character: Alternating current, 60 hertz, three phase, delivered
and metered at the voltages and points established by contract.
Monthly Rate:
Capacity Charge: $6.90 for each kilowatt per month (kWmo) of the
effective contract rate of delivery for peaking power or the maximum
amount scheduled, whichever is greater.
Energy Charge: 19.05 mills for each kilowatthour (kWh) for all
energy scheduled for delivery without return.
Charge Components:
Base: A fixed revenue requirement that includes operation and
maintenance expense, investment and replacements, normal timing
purchase power (purchases due to operational constraints, not
associated with drought), and transmission costs.
[GRAPHIC] [TIFF OMITTED] TN18DE09.425
Drought Adder: A formula-based revenue requirement that includes
future purchase power above timing purchases, previous purchase power
drought deficits, and interest on the purchase power drought deficits.
[GRAPHIC] [TIFF OMITTED] TN18DE09.426
Process: Any proposed change to the Base component will require a
public process.
The Drought Adder may be adjusted annually using the above formula
for any costs attributed to drought of less than or equal to the
equivalent of 2 mills/kWh to the Power Repayment Study composite rate.
Any planned incremental adjustment to the Drought Adder greater than
the equivalent of 2 mills/kWh to the PRS composite rate will require a
public process.
Billing Capacity: The billing capacity will be the greater of (1)
the highest 30-minute integrated capacity measured during the month up
to, but not in excess of, the delivery obligation under the power sales
contract, or (2) the contract rate of delivery.
Adjustments:
Billing for Unauthorized Overruns: For each billing period in which
there is a contract violation involving an unauthorized overrun of the
contractual obligation for peaking capacity and/or energy, such overrun
shall be billed at 10 times the above rate.
[FR Doc. E9-30149 Filed 12-17-09; 8:45 am]
BILLING CODE 6450-01-P
