[Federal Register Volume 64, Number 26 (Tuesday, February 9, 1999)]
[Notices]
[Pages 6342-6344]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-3115]
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DEPARTMENT OF ENERGY
Southwestern Power Administration
Integrated System Rate Schedules
AGENCY: Southwestern Power Administration, DOE.
ACTION: Notice of rate order.
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SUMMARY: The Deputy Secretary acting under Amendment No. 3 to
Delegation Order No. 0204-108, effective November 10, 1993, has
approved and placed into effect on an interim basis Rate Order No.
SWPA-39 which provides the following Integrated System Rate Schedules:
Rate Schedule P-98B, Wholesale Rates for Hydro Peaking Power
Rate Schedule NFTS-98B, Wholesale Rates for Non-Federal Transmission
Service
FOR FURTHER INFORMATION CONTACT: Forrest E. Reeves, Assistant
Administrator, Office of Corporate Operations, Southwestern Power
Administration, Department of Energy, PO Box 1619, Tulsa, Oklahoma
74101-1619.
SUPPLEMENTARY INFORMATION: The FY 1998 Power Repayment Study indicated
that rates prescribed by Rate Schedules P-98A, Wholesale Rates for
Hydro Peaking Power, and NFTS-98, Wholesale Rates for Non-Federal
Transmission Service, are sufficient to meet repayment criteria and do
not require any adjustment. However, certain aspects of the terms and
conditions set forth in the rate schedules need to be revised for
clarification and to accommodate market conditions experienced this
past year. The names of the rate schedules have been changed from P-98A
and NFTS-98 to P-98B and NFTS-98B to reflect the fact that revisions
have been made. Southwestern has followed Title 10, part 903, subpart A
of the Code of Federal Regulations, ``Procedures for Public
Participation in Power and Transmission Rate Adjustments,'' in
connection with the minor rate schedule revisions being proposed. The
public was advised by notice published in the Federal Register (63 FR
63469), November 13, 1998, of proposed rate schedule changes and of the
opportunity to provide written comments for a period of 30 days ending
December 14, 1998. Accordingly, several informal meetings were held
with customers and interested parties to discuss the proposed changes.
One formal written comment was received which supports the proposed
rate schedule changes.
Rate Schedule P-98B applies to wholesale customers purchasing hydro
peaking power and peaking energy from the Integrated System. This rate
schedule is designed for the sale of Federal power and energy.
Provisions in the rate schedule were revised to reflect minor
corrections and modifications for the purpose of clarification and to
address changes in specified terms and conditions of the rate schedule
that were found to be insufficient to provide the desired results in
light of recent market experiences. No rates for the sale of Federal
power and energy were changed.
The section discussing and listing the Power Customer-specific
credit, which ended June 30, 1998, has been removed since it is no
longer applicable. The existing rate schedule (P-98A) determined the
rate for Real Power Losses based upon the cost of energy for
Southwestern's marketing area during the previous Fiscal Year, as set
forth in the most recently available Energy Information Administration
(EIA) Publication. The EIA has recently ceased to compile this
information, making it necessary for Southwestern to develop an
alternative source upon which to base its rate for Real Power Losses.
The basis for determining the rate to charge for Real Power Losses was
therefore modified to use the average actual costs incurred by
Southwestern for the purchase of energy to replace Real Power Losses
during the most recent twelve-month period, as reflected in
Southwestern's financial records. The rate for Real Power Losses will
be posted on Southwestern's OASIS. Southwestern proposes to initially
implement this rate effective January 1, 1999, and thereafter the rate
will be reviewed and adjusted to become effective at the beginning of
each Fiscal Year (October 1). The Energy Imbalance Service description
has been modified to clarify that the Energy Imbalance Service
bandwidth specified in Southwestern's Open Access Transmission Tariff
does not apply to the deliveries of Hydro Peaking Power and associated
energy. However, Power Customers who consume a capacity of Hydro
Peaking Power greater than their Peak Contract Demand may be subject to
a Capacity Overrun Penalty. As a result of this past summer's recent
price escalation for power and the potential unauthorized use of
Southwestern's system, Southwestern has revised the Capacity Overrun
Penalty provision. It was determined that this penalty would need to be
increased to provide a greater incentive to not overrun Southwestern's
Integrated System capacity. The Capacity Overrun Penalty provision has
been revised to assess a $0.10 per kilowatt penalty during the months
of March, April, May, October, November, and December for each hour
during which Hydro Peaking Power was provided at a rate greater than
that to which the Power Customer is entitled. A penalty of $0.30 per
kilowatt will likewise be assessed during the months of January,
February, June, July, August, and September.
Rate Schedule NFTS-98B applies to wholesale customers purchasing
Non-Federal Point-to-Point and Network Transmission Service. Both the
Real Power Losses and the Capacity Overrun Penalty sections have been
revised in the same manner as in Rate Schedule P-98B, noted above.
However, there is no change in the Energy Imbalance bandwidth under
this rate schedule.
Following review of Southwestern's proposal within the Department
of Energy, I approved Rate Order No. SWPA-39 on an interim basis
through September 30, 2001, or until confirmed and approved on a final
basis by the Federal Energy Regulatory Commission.
Dated: January 27, 1999.
Ernest J. Moniz,
Acting Deputy Secretary.
Order Confirming, Approving and Placing Revised Power Rate
Schedules in Effect on an Interim Basis
[Rate Order No. SWPA-39]
January 1, 1999.
Pursuant to sections 302(a) and 301(b) of the Department of Energy
Organization Act, Public Law 95-91, the functions of the Secretary of
the Interior and the Federal Power Commission under Section 5 of the
Flood Control Act of 1944, 16 U.S.C. 825s, for the Southwestern Power
Administration (Southwestern) were transferred to and vested in the
Secretary of Energy. By Delegation Order No. 0204-108, effective
December 14, 1983, 48 FR 55664, the Secretary of Energy delegated to
the Deputy Secretary of Energy on a non-exclusive basis the authority
to confirm, approve and place into effect on an interim basis power and
[[Page 6343]]
transmission rates, and delegated to the Federal Energy Regulatory
Commission (FERC) on an exclusive basis the authority to confirm,
approve and place in effect on a final basis, or to disapprove power
and transmission rates. Amendment No. 1 to Delegation Order No. 0204-
108, effective May 30, 1986, 51 FR 19744, revised the delegation of
authority to confirm, approve and place into effect on an interim basis
power and transmission rates to the Under Secretary of Energy rather
than the Deputy Secretary of Energy. This delegation was reassigned to
the Deputy Secretary of Energy by Department of Energy (DOE) Notice
1110.29, dated October 27, 1988, and clarified by Secretary of Energy
Notice SEN-10-89, dated August 3, 1989, and subsequent revisions. By
Amendment No. 2 to Delegation Order No. 0204-108, effective August 23,
1991, 56 FR 41835, the Secretary of the Department of Energy revised
Delegation Order No. 0204-108 to delegate to the Assistant Secretary,
Conservation and Renewable Energy, the authority which was previously
delegated to the Deputy Secretary in that Delegation Order. By
Amendment No. 3 to Delegation Order No. 0204-108, effective November
10, 1993, 58 FR 59717, the Secretary of Energy revised the delegation
of authority to confirm, approve and place into effect on an interim
basis power and transmission rates by delegating that authority to the
Deputy Secretary of Energy. This rate order is issued by the Deputy
Secretary pursuant to said Amendment to Delegation Order No. 0204-108.
It is also made pursuant to the authorities as implemented in 10 CFR
903.
Background
In November 1997, Southwestern Power Administration (Southwestern)
completed its review of the adequacy of the current rate schedules for
the Integrated System and finalized its FY 1997 Power Repayment Studies
(PRSs). The studies indicated that the proposed rates as shown in Rate
Schedules P-98A and NFTS-98 would meet cost recovery criteria for the
Integrated System projects. Federal Energy Regulatory Commission (FERC)
confirmation and approval of the following Integrated System.
(System) rate schedules was provided in FERC Docket No. EF98-4011-
000 issued April 29, 1998, for the period January 1, 1998, through
September 30, 2001:
Rate Schedule P-98A, Wholesale Rates for Hydro Peaking Power
Rate Schedule NFTS-98, Wholesale Rates for Point-to-Point and Network
Transmission Service
Rate Schedule EE-98, Wholesale Rate for Excess Energy
Based on operations under the approved Rate Schedules, the
Administrator, Southwestern, has determined that minor revisions to the
terms and conditions within existing rate schedules P-98A and NFTS-98
are required. Since the proposed changes to the rate schedules are
associated with the terms and conditions of service, the net results of
the 1997 Integrated System Power Repayment Studies, which was the basis
for the existing rate schedules, will not be altered. The designations
of the aforementioned rate schedules have been revised from P-98A and
NFTS-98 to P-98B and NFTS-98B to reflect the fact that revisions have
been made.
Title 10, Part 903 Subpart A, of the Code of Federal Regulations,
``Procedures for Public Participation in Power and Transmission Rate
Adjustments and Extensions'' (Part 903) have been followed in
connection with the proposed Rate Schedules P-98B and NFTS-98B. An
opportunity for customers and other interested members of the public to
review and comment on the proposed Rate Schedules P-98B and NFTS-98B
was announced by notice published in the Federal Register November 13,
1998 (63 FR 63469), with written comments due by December 14, 1998. In
addition, Southwestern held informal meetings with customers to discuss
proposed changes and to provide opportunity for input in the
development of these changes. There was one written comment received
which supports the proposed changes.
Discussion
Rate Schedule P-98B applies to wholesale customers purchasing hydro
peaking power and peaking energy from the Integrated System. This rate
schedule is designed for the sale of Federal power and energy.
Provisions in the rate schedule were revised to reflect minor
corrections and modifications for the purpose of clarification and to
address changes in specified terms and conditions of the rate schedule
that were found to be insufficient to provide the desired results in
light of recent market experiences. No rates for the sale of Federal
power and energy were changed.
The section, Energy Credit, addressing and listing the Power
Customer-specific credits, which ended June 30, 1998, has been removed
since it is no longer applicable. Further changes were made to the
terms and conditions of Real Power Losses, Energy Imbalance Service,
and the Capacity Overrun Penalty and are addressed in detail below.
The existing rate schedule (P-98A) determined the rate for Real
Power Losses based upon the cost of energy for Southwestern's marketing
area during the previous Fiscal Year, as set forth in the most recently
available Energy Information Administration (EIA) Publication. The EIA
has recently ceased to compile this information, making it necessary
for Southwestern to develop an alternative source upon which to base
its rate for Real Power Losses. The basis for determining the rate to
charge for Real Power Losses was therefore modified to use the average
actual costs incurred by Southwestern for the purchase of energy to
replace Real Power Losses during the most recent twelve-month period,
as reflected in Southwestern's financial records. The rate for Real
Power Losses will be posted on Southwestern's OASIS. Southwestern
proposes to initially implement this rate January 1, 1999, and
thereafter the rate will be reviewed and adjusted to become effective
at the beginning of each Fiscal Year (October 1).
The Energy Imbalance Service description has been modified to
clarify that the Energy Imbalance Service bandwidth specified in
Southwestern's Open Access Transmission Tariff does not apply to the
deliveries of Hydro Peaking Power and associated energy. However, Power
Customers who consume a capacity of Hydro Peaking Power greater than
their Peak Contract Demand may be subject to a Capacity Overrun
Penalty.
The Capacity Overrun provision set forth in the existing rate
schedule assesses a penalty of $0.05 per kilowatthour for any energy
which flows outside the authorized bandwidth from a range of 1 to 2,000
kilowatts and a penalty of $0.10 per kilowatthour for any energy which
flows outside the authorized bandwidth from 2,001 kilowatts or greater.
As a result of this past summer's recent price escalation for power and
the potential unauthorized use of Southwestern's system, Southwestern
has revised the Capacity Overrun Penalty provision. It was determined
that this penalty would need to be increased to provide a greater
incentive to not overrun Southwestern's system capacity. The Capacity
Overrun Penalty provision has been revised to assess a $0.10 per
kilowatt penalty during the months of March, April, May, October,
November, and December for each hour during which Hydro Peaking Power
was provided at a rate greater than that to which the Power
[[Page 6344]]
Customer is entitled. A penalty of $0.30 per kilowatt will likewise be
assessed during the months of January, February, June, July, August,
and September.
Rate Schedule NFTS-98B applies to wholesale customers purchasing
Non-Federal Point-to-Point and Network Transmission Service. Both the
Real Power Losses and the Capacity Overrun Penalty sections have been
revised in the same manner as in Rate Schedule P-98B, noted above.
However, there is no change in the Energy Imbalance bandwidth under
this rate schedule.
Comments and Responses
Southwestern has received one formal written comment from customers
which supports the Rate Schedule changes.
Other Issues
There were no other issues raised during the informal meetings or
during the formal public participation period.
Availability of Information
Information regarding this rate proposal including studies,
comments and other supporting material, is available for public review
and comment in the offices of Southwestern Power Administration, One
West Third Street, Tulsa, OK 74101.
Administrator's Certification
The revised rate schedules will repay all costs of the Integrated
System including amortization of the power investment consistent with
the provisions of Department of Energy Order No. RA 6120.2. In
accordance with section 1 of Delegation Order No. 0204-108, as amended
November 10, 1993, 58 FR 59717, and Section 5 of the Flood Control Act
of 1944, the Administrator has determined that the proposed System Rate
Schedules are consistent with applicable law and the lowest possible
rates consistent with sound business principles.
Environment
No additional evaluation of the environmental impact of the
proposed rate schedule changes was conducted since no change has been
made to the currently-approved System rates which were determined to
fall within the class of actions that are categorically excluded from
the requirements of preparing either an Environmental Impact Statement
or an Environmental Assessment.
Order
In view of the foregoing and pursuant to the authority delegated to
me by the Secretary of Energy, I hereby confirm, approve and place in
effect on an interim basis, effective January 1, 1999, the Southwestern
Integrated System Rate Schedules P-98B and NFTS-98B which shall remain
in effect on an interim basis through September 30, 2001, or until the
FERC confirms and approves the rates on a final basis.
Dated: January 27, 1999.
Ernest J. Moniz,
Acting Deputy Secretary.
[FR Doc. 99-3115 Filed 2-8-99; 8:45 am]
BILLING CODE 6450-01-P
