01-3188. Proposed Rate Schedule Changes

AGENCY:

Southwestern Power Administration, DOE.

ACTION:

Notice of rate schedule changes for public review and comment.

SUMMARY:

The Administrator, Southwestern Power Administration (Southwestern), has determined that changes to the use of the energy imbalance service in the current Rate Schedule NFTS-98C and the power factor penalty formula in Rate Schedules P-98C and NFTS-98C are needed. In addition, an Interconnection Facilities Service Charge is being established in the revised NFTS-98C rate schedule. This charge will provide compensation to Southwestern when other entities use facilities of the Federal government through interconnections for which no other benefits are being received. Other areas within the rate schedules have been modified for clarity or eliminated if no longer applicable. Since the proposed changes to the rate schedules are associated with the terms and conditions of current service and the establishment of a new charge for which Southwestern currently has no contractual arrangements, there is no immediate impact on the previously established revenue requirements for Southwestern's Integrated System. Consequently, the net result of the revenue requirements projected in the 1997 Integrated System Power Repayment Studies, which provided the basis for the existing rate schedules, is not changed.

DATES:

Written comments on the proposed rate schedule changes are due on or before March 9, 2001.

FOR FURTHER INFORMATION CONTACT:

Mr. Forrest E. Reeves, Assistant Administrator, Office of Corporate Operations, [phone], [e-mail].

SUPPLEMENTARY INFORMATION:

The names of the rate schedules will be changed from P-98C and NFTS-98C to P-98D and NFTS-98D, respectively, in order to reflect the fact that changes have been made. These rate schedules are being changed at this time to address, prior to the summer electrical peak period, previously unforeseen problems that have arisen as a result of the time differential in the price of power. The provisions of the rate schedules being changed are: (1) The Limitations on Energy Imbalance Service; (2) the Power Factor Penalty; (3) the addition of an Interconnection Facilities Service Charge; and, (4) modifications to enhance clarity within the rate schedules. The proposed changes are described below:

The Limitations on Energy Imbalance Service in the proposed NFTS-98D rate schedule has been changed to better clarify the hours and circumstances in which energy within the authorized bandwidth is to be returned to the providing party. The current rate schedule provided for energy within the authorized bandwidth to be returned to Southwestern “in like hours and similar circumstances.” The lack of definition in this language provided an opportunity for customers to use the bandwidth during high-value peak demand periods and to return the energy during low-value off-peak demand periods. The need to be more explicit regarding the like hours and circumstances for return of the energy is important, particularly during summer peak periods when the value of energy is high and the capability of Southwestern to provide such energy during those times is typically low.

The Power Factor Penalty is being changed in the proposed P-98D and NFTS-98D rate schedules to more accurately charge for the reactive kilovolt amperes (rkVA or VARs) taken from the System of Southwestern during any particular hour which contribute to power factors less than 95 percent, rather than the current process which charges for the customer's peak demand in kilowatts for the month in which a low power factor was calculated. This revised penalty more closely ties the provision to the actual VARs taken from the System of Southwestern. In addition, Southwestern has expanded the application of this penalty to provide for a charge at interconnections that could also experience a low power factor.

Southwestern is adding a new provision to the NFTS-98D rate schedule for an Interconnection Facilities Service Charge. This charge will be applicable to those customers who request an interconnection on the System of Southwestern that does not provide commensurate transmission system support benefits or compensation to Southwestern for the use of Federal facilities. In order for Southwestern to provide an interconnection on its system, Southwestern has historically and must continue to secure commensurate benefits for the use of its facilities to assure that the Federal Government is compensated for the use of such facilities, thereby recovering its costs, and to assure that all customers are charged the same for the same type of service. The charge for this service has been set at $0.69 per kilowatt per month, which represents the cost of Southwestern's facilities being used.

Redlined versions of the revised rate schedules P-98D and NFTS-98D are available upon request. To request a copy, please contact Barbara Otte at 918-595-6674 or at [e-mail] or Tracey Hannon at 918-595-6677 or at [e-mail].

The Administrator has determined that written comments will provide adequate opportunity for public participation in the rate schedule revision process. Therefore, an opportunity is presented for interested parties to submit written comments on the proposed rate schedule changes. Written comments are due no later than thirty (30) days following publication of this notice in the Federal Register. Five copies of written comments should be submitted to: Forrest E. Reeves, Assistant Administrator, Southwestern Power Administration, One West Third Street, Suite 1400, Tulsa, OK 74103.

Following review and consideration of written comments, the Administrator will finalize and submit the proposed rate schedules to the Deputy Secretary of Energy for approval on an interim basis. The Deputy Secretary will then forward the proposed rate schedules to the Federal Energy Regulatory Commission for confirmation and approval on a final basis.

Issued at Tulsa, Oklahoma this 24th day of January 2001.

Michael A. Deihl,

Administrator.