[Federal Register Volume 59, Number 68 (Friday, April 8, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-8478]
[[Page Unknown]]
[Federal Register: April 8, 1994]
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DEPARTMENT OF ENERGY
Western Area Power Administration
Collections From Central Valley Project Power Contractors To
Carry Out the Restoration, Improvement, and Acquisition of
Environmental Habitat Provisions of the Central Valley Project
Improvement Act of 1992
AGENCY: Western Area Power Administration, DOE.
ACTION: Notice of final procedures for the assessment and collection of
restoration fund payments from the Central Valley Project power
contractors.
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SUMMARY: The Central Valley Project (CVP) Improvement Act of 1992 (Act)
(Pub. L. 102-575, 106 Stat. 4706 et seq.) establishes in the Treasury
of the United States the ``Central Valley Project Restoration Fund'' to
carry out the habitat restoration, improvement, and acquisition
provisions of the Act. The Act further requires the Secretary of the
Interior to assess and collect annual mitigation and restoration
payments from CVP water and power contractors. The Secretary of the
Interior, through the Bureau of Reclamation (Reclamation), is
responsible for determining the CVP water contractors' share and the
CVP power contractors' share of the Restoration Fund payments. Because
Western Area Power Administration (Western) is responsible for the
marketing of CVP power and maintains all CVP power contracts, Western
has agreed to assess and collect the total CVP power contractors' share
of the Restoration Fund payments, as determined by Reclamation, from
the CVP power contractors. By publication of this notice, Western
establishes procedures to accomplish the assessment and collection of
Restoration Fund payments from the CVP power contractors as required by
the Act.
DATES: The final procedures will become effective May 9, 1994 and will
remain in effect until superseded.
ADDRESSES: Information regarding this final procedure, including
spreadsheet analysis, comments, letters, memorandums, and other
supporting documents made or kept by Western for the purpose of
developing these procedures, is available for public inspection and
copying at Western's Sacramento Area Office located at 1825 Bell
Street, suite 105, Sacramento, CA 95825-1097.
FOR FURTHER INFORMATION CONTACT:
James C. Feider, Area Manager, Sacramento Area Office, Western Area
Power Administration, 1825 Bell Street, suite 105, Sacramento, CA
95825-1097, (916) 649-4418.
SUPPLEMENTARY INFORMATION: Section 3407 of the Act establishes in the
Treasury of the United States the ``Central Valley Project Restoration
Fund'' to carry out the habitat restoration, improvement, and
acquisition provisions of the Act. The Act further requires the
Secretary of the Interior to assess and collect annual mitigation and
restoration payments from CVP water and power contractors. The
Secretary of the Interior, through Reclamation, is responsible for
determining and collecting the CVP water contractors' share and the CVP
power contractors' share of the annual Restoration Fund payments.
Because Western is responsible for the marketing of CVP power,
Western has agreed to administer the assessment and collection of the
Restoration Fund payments from the CVP power contractors. Western has
executed a Letter of Agreement with Reclamation to establish procedures
for depositing the collections from the CVP power contractors into the
Restoration Fund.
The total power Restoration Fund payment obligation, determined by
Reclamation, will be assessed to the CVP power contractors. Every month
each CVP power contractor will receive a bill reflecting the amount to
be paid into the Restoration Fund. The CVP power contractor will pay
that amount to Western, who will deposit all amounts collected from the
CVP power contractors into the Restoration Fund.
Acronyms and Definitions
Descriptions of the acronyms and definitions used in this Federal
Register notice may be found in the Final Procedures.
Public Notice and Comments
The process used by Western to ensure involvement of interested
parties in the development of these final procedures for assessing and
collecting Restoration Fund payments from the CVP power contractors is
summarized below.
1. On October 1, 1993, Western issued a letter to all CVP customers
announcing Reclamation's determination of a total power Restoration
Fund payment obligation of $7,092,800 for fiscal year (FY) 1994.
2. On October 29, 1993, in a letter to all CVP power customers,
Western announced the plans to implement collections from the CVP power
contractors for the Restoration Fund on an interim basis, beginning
with a November 24, 1993, bill.
3. A Federal Register notice was published at 58 FR 62343, November
26, 1993, officially announcing the proposed procedures for the
assessment and collection of the Restoration Fund payments from the CVP
power contractors, initiating the public consultation and comment
period, announcing the public information forum and public comment
forum, and presenting procedures for public participation.
4. On December 1, 1993, in a letter to all CVP customers and
interested parties, Western announced that the public consultation and
comment period had begun; announced the dates, times, and locations of
the public information forum and the public comment forum; and enclosed
a copy of the November 26, 1993, Federal Register notice.
5. At the public information forum held on December 16, 1993,
Western's staff presented the proposed procedures for the assessment
and collection of Restoration Fund payments and discussed the
methodologies and studies that were used in developing the proposed
procedures.
6. A public comment forum was held on December 16, 1993, to give
the public the opportunity to comment for the record. Three persons
representing customers made oral comments.
7. Fifteen comment letters were received during the 30-day
consultation and comment period. The consultation and comment period
ended December 26, 1993. All formally submitted comments have been
considered in the preparation of the final procedures.
8. On December 30, 1993, copies of all written comments received
during the 30-day comment period were sent to all CVP customers and
interested parties.
9. Based on customer comments regarding the proposed assessment and
collection method, Western analyzed various alternative methods to
address certain concerns. Upon request, Western shared these analyses
at a Northern California Power Agency members meeting on January 13,
1994, and a CVP Customer Technical Committee Meeting on January 19,
1994.
10. On February 3, 1994, in a letter addressed to the Restoration
Fund commentors, Western provided copies of all handouts distributed
during the meetings specified in item 9 above.
Comments
During the 30-day consultation and comment period, Western received
15 written comments from 14 different sources. In addition, three
persons commented during the December 16, 1993, public comment forum.
Written comments were received from the following sources:
Alameda, City of (California)
Arvin Edison Water Storage District (California)
Calaveras Public Power Agency (California)
Modesto Irrigation District (California)
Palo Alto, City of (California)
Petershagen, Mr. George F. (California)
Redding, City of (California)
Roseville, City of (California)
Sacramento Municipal Utility District (California)
Santa Clara, City of (California)
Shasta Lake, City of (California)
Trinity County Public Utility District (California)
Tuolomne County Public Power Agency (California)
Westlands Water District (California).
Representatives of the following organizations made oral comments:
Redding, City of (California)
Roseville, City of (California)
Sacramento Municipal Utility District (California).
Most of the comments Western received dealt with assessing the
total Restoration Fund payment obligation to scheduled or delivered
energy, the authority to collect interim bills and assess late payment
charges during the interim period, the issuance of separate bills, and
establishing a review process for the final procedures. Additional
comments were received regarding assessing excess energy and capacity
sales, excluding first preference customers from the assessment,
assessing project use, changing the amount allocated to power by
Reclamation, and conducting an informal workshop. Discussion of the
comments will be grouped by these issues, with all other comments
placed under the heading of ``Other.'' In some cases Western will
address several comments with one response. The comments, paraphrased
for brevity, and responses are presented below.
Assessing to Scheduled or Delivered Energy
Comment: The agricultural power users consider Western's proposal
to be a fair and equitable method of allocating Restoration Fund
payment obligations.
Comment: The proposal states that total collections will be the
same each month which could penalize seasonally diverse customers. It
seems appropriate that the collections more nearly reflect monthly
revenues.
Comment: Energy alone is not an adequate assessment factor to
reflect utilization of the CVP. Factors such as actual demand and CVP
allocation used either separately or together could be more
representative than just energy alone.
Comment: The proposal is likely to foster a market environment in
which Western's scheduling power contractors compete against other
Western power contractors to minimize the impact of the Restoration
Fund. Establish the assessment based on a system-wide per-kilowatthour
(kWh) basis.
Comment: By assessing monthly energy, Western would distort
recently approved rates by effectively increasing the energy rate but
not the other charges included in bills. This could cause an
undesirable and/or unexpected response by customers who have resource
flexibility.
Comment: An assessment of the payment as a fixed surcharge based on
a percentage of monthly energy entitlement would totally eliminate the
incentive to avoid restoration payments through reducing scheduled
energy.
Comment: Assess the Restoration Fund payment obligation based on
total Contract Rate of Delivery (CRD). Under the proposed plan,
contract users could direct their energy needs from other sources in
order to evade payment of the Restoration Fund assessment leaving
customers with limited resource options to pay a larger portion of the
payment.
Comment: The recent CVP rate process found that a 40-percent
capacity and 60-percent energy split is most equitable. The Restoration
Fund collections should also be assessed in this manner.
Comment: Western has considered the cost allocation issue in
length, in the CVP general rate case proceeding, and determined that
the appropriate allocation of revenue requirements (costs) is 40
percent to capacity/60 percent to energy. We recommend Western utilize
this same methodology to allocate the Restoration Fund costs.
Comment: Diversify the proposal to collect 50 percent on capacity
sales and 50 percent on energy sales; this will distribute and dilute
any uncontrollable price signals and discourage defensive gaming.
Response: Western shares in the concerns of customers who felt the
proposed method would (1) penalize seasonally diverse customers, (2)
send adverse pricing signals, and/or (3) allow for adverse actions on
behalf of certain customer groups. Therefore, Western has decided to
prorate the total Restoration Fund payment obligation among actual
delivered or scheduled energy and capacity on a 50/50 basis.
Western considered the comments recommending the allocation be
based on actual energy entitlement or CRD. Western believes the
assessment should reflect actual use of the CVP power system and not a
customer's upper limit on use of the CVP system.
Western agrees that extensive analyses for the recent CVP rate
process indicated that Western's costs are best represented in a 40-
percent capacity 60-percent energy ratio. Western also agrees that
heavily assessing CVP energy costs may send adverse pricing signals.
However, as stated above, it is Western's position that the Restoration
Fund should be assessed based on the actual use of the resource
provided rather than the costs associated with that resource use. The
50/50 basis was chosen because it reflects an assessment to both types
of long-term power services available from the CVP. Adverse pricing
signals that may be caused by an inequitable assessment to capacity or
energy will be reduced with a 50-percent delivered or scheduled energy,
50-percent delivered or scheduled capacity assessment.
Authority To Assess and Collect Interest on Interim Bills
Comment: Will interest accrue on interim billing or after the
public process becomes final?
Comment: Western does not have the authority to require customers
to pay interim bills or assess interest before a final procedure is
adopted.
Comment: Western should formally acknowledge that payment during
the interim period is optional.
Comment: We appreciate your interest to minimize cash flow impacts
by starting collections as soon as possible. However, some customers
may prefer to wait until the public process is complete. We suggest
that the interim procedures be made optional.
Comment: Current contract provisions do not provide for the
assessment of the Restoration Fund fees.
Response: Western initiated the interim assessment and collection
process during the public process to reduce the economic impact to the
CVP power contractors, to proactively support the provisions of the
Act, and to assist Reclamation. Payments made by the CVP power
contractors during the interim period are considered by Western to be
optional. Bills not paid during the interim period did not accrue
interest. All billing notices sent to the CVP power contractors during
the interim period stated, ``Interim billing is not subject to a late
charge assessment.'' Although Restoration Fund payments are not
included in the CVP power sales contracts, collection is mandated by
the Act. Adoption of these final procedures provides Western the legal
authority to collect Restoration Fund payments. Interest will accrue on
Restoration Fund bills in the first billing cycle 30 days after the
publication of the final procedures in the Federal Register.
Separate Billing
Comment: Are the bills separate? Why is there a separate bill
versus inclusion in the current power bill from Western?
Comment: Does the Act mandate monthly payments? What governed the
timing of the collection? Could collections be made on a quarterly
basis?
Comment: The Act provides for annual, not monthly, payments to be
collected from the CVP water and power customers.
Comment: We would like to avoid the administrative burden of an
additional monthly bill.
Comment: We support the Western proposal to utilize a separate
billing for the Restoration Fund. This approach allows all parties to
clearly identify the payments that are being made pursuant to the
Central Valley Project Improvement Act.
Comment: We support the proposed separate billing; this will aid in
tracking our share of the Restoration Fund.
Response: Western will use separate bills to assess the Restoration
Fund payments to the CVP power contractors. The Secretary of the
Interior, through Reclamation, is responsible for determining and
collecting the CVP water contractors' share and the CVP power
contractors' share of the annual Restoration Fund payments. Because
Western is responsible for the marketing of CVP power, Western has
agreed to administer the assessment and collection of the Restoration
Fund payments from the CVP power contractors on behalf of Reclamation.
Western is assessing the total Restoration Fund payment obligation
among the CVP power contractors as a pass-through surcharge from
Reclamation. The Restoration Fund assessment is not associated with
current CVP rates or power revenues; the funds will not flow through
the CVP power repayment study, nor will they be deposited into the
Reclamation Fund to be applied to the repayment of CVP investment. In
addition, the amounts collected for the Restoration Fund are deposited
into a separate Treasury account and late payment interest charges are
assessed in a different manner than those imposed by the General Power
Contract Provisions included in the CVP power contractors' power sales
contracts. Western has adopted assessment and collection of the
Restoration Fund payments on a monthly basis to assure adequate cash
flow to Reclamation to carry out the goals of the Act.
Establish a Review Process for the Final Procedures
Comment: What would happen if the Act is overturned or its
implementation is delayed?
Comment: Is there a sunset clause? What will happen if Congress
increases the limit significantly?
Comment: Is the proposed procedure permanent for the duration of
the Fund?
Comment: Include an opportunity to reopen the public process in the
final methodology, in case of unforeseen problems.
Comment: Build in the flexibility to review every 2, 3, or 5 years
at the longest.
Comment: We recommend that the final procedures include a statement
that Western will automatically reopen the surcharge matter for comment
and revision, in conjunction with the CVP's normal 5-year ratemaking
process.
Comment: The assessment method should include a review process to
accommodate change and improvements that will become necessary as we
gain experience with the method and its effects.
Response: Western agrees with customer comments and concerns and
has included a review process in the final procedures. Minimally,
Western will review the assessment method every 5 years from the
effective date of the final procedures or if one of the following
occurs:
(1) If there is a significant change to or suspension of the
legislation,
(2) If a material issue arises, or
(3) If an apparent inequity in the assessment method is discovered.
Assess Excess Capacity and Energy Sales
Comment: Why were Energy Account Number 2 (EA2) and excess capacity
sales excluded from the allocation?
Comment: Does Western do any other sales to Pacific Gas and
Electric Company (PG&E)?
Comment: Entities receiving excess energy may escape an assessment;
this will increase the assessment to long-term power contractors, and
the increased assessment would be for energy not yet received. This
does not appear equitable.
Comment: Seasonal CVP capacity is provided by CVP generating
facilities and ``impacts'' the CVP waterways in the same manner normal
sales of CVP capacity and energy might ``impact'' waterways. To
disregard an allocation to this type of sale would allow certain
customers to benefit from CVP power without paying for a portion of the
Restoration Fund.
Comment: Excess power sales should be assessed because those end
users are also benefiting from the CVP.
Response: Western sells two types of surplus power: surplus energy
and surplus capacity. Surplus power is only available for sale by
Western after contractual obligations are fulfilled. Western proposed
the total power Restoration Fund payment obligation be assessed to the
CVP power contractors that purchase power on a long-term basis because
Western believes that the assessment should be made on power sales that
are predictable during the year and should be billed to customers that
are fully benefiting from the CVP resource. By definition, this
excludes sales of surplus power because surplus power is not normally
available for a period in excess of 1 year.
Surplus energy is normally sold to PG&E, under contract number 14-
06-200-2948A, into EA2. Later, Western may repurchase the energy from
PG&E at rates that reflect savings incurred by PG&E in the original
purchase price from Western. If EA2 sales are assessed a portion of the
total power Restoration Fund payment obligation, the increased cost to
PG&E would be reflected in the repurchase of the energy upon withdrawal
from EA2, which would result in a higher cost for energy. Such higher
costs will be passed on to the CVP power customers in future power
rates or the revenue adjustment clause.
Excess capacity sales may be offered to scheduling utilities
normally at rates that reflect Western's costs associated with
capacity. Revenues from these sales increase the total revenue
available for CVP repayment. If the excess capacity sales included the
Restoration Fund assessment, less revenue would be available for the
repayment of CVP investment. Furthermore, Western's excess capacity
sales compete in the market and the addition of the Restoration Fund
assessment may make this service noncompetitive.
Exclude First Preference Customers From the Assessment
Comment: Western's proposed procedures for the collection of
Restoration Fund payments provides for two exclusions: EA2 sales and
excess capacity sales. A third exclusion should be added for first
preference customers because these customers' counties natural
resources were appropriated to build facilities of the CVP and because
the fish and wildlife restoration goals for the Trinity River are not
funded by the Restoration Fund, but by the Trinity River Basin Fish and
Wildlife Restoration Program (Pub. L. 98-541).
Response: The Act was designed to benefit many interests within the
State of California. In section 3402 of the Act, Congress provided for
a wide variety of purposes. These purposes include the protection,
restoration, and enhancement of fish, wildlife, and associated habitats
in the Central Valley and Trinity River basins of California; an
attempt to achieve a reasonable balance among competing demands for the
use of CVP water; and other benefits to particular areas of the State
of California, and to the State as a whole. Because the Act and the
Restoration Fund were designed to service varied interests, including
those within the first preference customers' home counties, Western has
chosen not to make payment into the Restoration Fund connected to
benefits to be received from the Restoration Fund.
The first preference customers have, by legislation, been allowed a
significant benefit over other preference entities in Western's service
area. Other preference entities must compete for an allocation of
Federal power under each marketing plan, and many eligible preference
entities receive no allocation. Congress sought to compensate these
counties for the natural resources appropriated when the Trinity and
New Melones facilities were constructed by allowing them this first
preference. In all other respects, the first preference customers are
to be treated as any other CVP preference power customer. See, Trinity
County Public Utilities District, et al. v. Harrington, 781 F.2d 163
(9th Cir. 1986). Western has chosen not to administratively extend
benefits of the first preference customers by excusing them from
payments made into the Restoration Fund.
Project Use
Comment: Are project use sales being assessed?
Comment: Wouldn't the amount charged to preference customers be
less if project use was assessed by Western?
Response: Project use is assessed by Reclamation in the amount
allocated to the water contractors. Because the allocation percentage
used by Reclamation to determine the total power Restoration Fund
payment obligation if for commercial power only, and does not include
project use, these sales will not be assessed.
Changing the Amount Allocated to Power by Reclamation
Comment: Revise the proposed procedures and eliminate any reference
of the willingness to pay whatever Reclamation requests into the
Restoration Fund. Congress, not Reclamation, determined the amount to
be allocated to power and water.
Comment: The 18 percent that Reclamation has assessed to power
needs to be addressed and made more equitable to all CVP users by
placing a larger portion on water users and less on electric
contractors.
Comment: Establish a balancing account to ensure sufficient funds
by collecting 10 percent more than Reclamation assesses.
Response: Western does not have the legal authority to increase or
decrease the amount allocated to power by Reclamation. The Act states,
``* * * the Secretary shall assess and collect annual mitigation and
restoration fund payments * * * that will result in collection, during
each fiscal year, of an amount that can be reasonably expected to equal
the amount appropriated each year * * * the Secretary shall require the
CVP water and power contractors to make such additional annual payments
as are necessary to yield * * * the amount required * * *.'' Although
Western has in the past and will in the future attempt to work with
Reclamation to assure that Restoration Fund allocations are reasonable,
Reclamation has final authority under the Act to determine the level of
allocations. Western is collecting the Restoration Fund assessment to
the CVP power contractors under the terms of an agreement between
Western and Reclamation. Issues regarding the amount allocated to power
by Reclamation should be addressed to Reclamation.
Conduct an Informal Workshop Prior to Publication of Final Procedures
Comment: An informal workshop might help to develop a mutually
acceptable surcharge for the CVP power customers.
Comment: Allowing only 5 days between the public information
meeting and public comment forum and the final written comments is too
restrictive. We urge you to extend the comment period or hold an
additional workshop prior to publishing the final procedures in the
Federal Register.
Response: Western believes that interested parties had adequate
time to comment on its proposed procedures. In response to customer
comments regarding the proposed assessment and collection method,
Western attended informal workshops and analyzed various alternative
methods to address certain concerns. Upon request, Western shared these
analyses at a Northern California Power Agency members meeting on
January 13, 1994, and a CVP Customer Technical committee meeting on
January 19, 1994. On February 3, 1994, in a letter addressed to the
Restoration Fund commentors, Western provided copies of all handouts
distributed during the above-mentioned meetings.
Other
Comment: Will Restoration Fund payment impact the current CVP
rates?
Response: No. Western is assessing the total power Restoration Fund
payment obligation among the CVP power contractors as a pass-through
surcharge from Reclamation. The Restoration Funds are not associated
with current CVP rates or power revenues; the funds will not flow
through the CVP power repayment study nor will they be deposited into
the Reclamation Fund to be applied to the repayment of CVP investment.
Comment: The proposed procedure involves retroactive billing which
is precedent setting and undesirable.
Response: Western has revised the final procedures. Under the final
procedures, CVP power contractors will know the amount of the
Restoration Fund assessment at the time the power purchase is made. The
assessment month is now defined as the period 1 month prior to the
billing month. This is consistent with Western's other current power
billing practices.
Comment: The assessment to the power contractors should be based on
CVP revenue requirements.
Response: Western feels that basing the Restoration Fund assessment
on revenue requirements would reflect the cost of the resources rather
than the use of those resources. It is Western's position that the
Restoration Fund should be assessed based on the actual use of the
resource provided rather than the costs associated with that resource.
Comment: Western's assessment includes both water and electric
contract users, therefore users with both water and power contracts
receive a double assessment.
Response: The Act requires an assessment to both CVP power and
water contractors. While this type of customer may or may not be the
only customers receiving two separate Restoration Fund assessments,
these customers are receiving the benefit of two clearly separable
resources.
Changes to Proposed Procedures
Western has considered all comments received during the 30-day
consultation and comment period from the CVP customers and interested
parties and has made changes to the proposed procedures. While the
decisions outlined in the final procedures may not reflect a consensus
on every issue, Western believes the final procedures to be an
equitable distribution of the total Restoration Fund payment obligation
among the CVP power customers. The final procedures will provide the
mechanism required to assess and collect an amount that can be
reasonably expected to equal the amount appropriated by Congress and
allocated to power by Reclamation.
The proposed procedures provided that the total power Restoration
Fund payment obligation assigned by Reclamation be prorated over the FY
to determine a total monthly obligation. Each month the total monthly
obligation was assessed to the CVP power contractors as a ratio of the
individual power contractor's delivered or scheduled energy to the
total delivered or scheduled energy recorded in the assessment month.
The assessment month was previously defined as the month 2 months prior
to the billing month. This definition has been changed; the assessment
month will be 1 month prior to the billing month. In the final
procedures, the total power restoration fund payment obligation will be
assessed on a 50/50 basis to both delivered or scheduled energy and
capacity. An energy and capacity multiplier will be derived from the
prior FY actual delivered or scheduled energy and capacity, adjusted
for any anticipated changes to the CVP power contractor base. The
multiplier will then be applied during the assessment month to each
power contractor's actual current year delivered or scheduled energy
and capacity.
The final procedures include a mid-year review of the assessment
method. If the actual amount assessed is 25 percent greater or less
than the projected assessments, Western will adjust the energy and
capacity multipliers. The CVP power contractors will be notified by
letter, and the adjusted multipliers will be applied for the remaining
months of the current FY. All other deviations in the amounts actually
collected or assessed will be rolled into the following FY assessment.
Finally, Western has agreed to review the final procedures at a minimum
of every 5 years or to accommodate for unforeseen changes or problems.
Interim Billing Adjustments
The total power Restoration Fund payment obligation assigned by
Reclamation to the CVP power contractors for FY 1994 is $7,092,800. In
an effort to implement collections for the Restoration Fund, Western
began issuing bills during an interim period on November 24, 1993. The
total power Restoration Fund payment obligation was prorated among the
CVP power contractors, and since November 1993, each CVP power
contractor has received a bill reflecting this prorated amount. The
amount assessed and collected from the CVP power contractors during the
interim period will be compared retroactively to the amount that should
be assessed and collected under the terms of the final procedures, as
follows:
Western will prorate the FY 1994 total Restoration Fund payment
obligation of $7,092,800 assessing 50 percent of the total to delivered
or scheduled energy and 50 percent to delivered or scheduled capacity.
This results in an equal assessment of $3,546,400 to delivered or
scheduled energy and capacity. Western has determined the FY 1993 total
delivered or scheduled energy and capacity and has made adjustments for
anticipated changes to the CVP power contractor base. The FY 1994
energy multiplier will be equal to $3,546,400 divided by the adjusted
delivered or scheduled energy of 7,314,510 megawatt-hours, or 0.48
mills/kWh. The FY 1994 capacity multiplier will be equal to $3,546,400
divided by the adjusted delivered or scheduled capacity of 14,373
megawatts, or $0.25/kilowatt-year. These multipliers will then be
applied to each CVP power contractor's actual energy and capacity since
October 1, 1993, to determine the total Restoration Fund payment due
from the contractor.
The total Restoration Fund payment due will be netted with the
total Restoration Fund payments assessed and collected during the
interim period. Any resulting increase/decrease will be assessed in the
first Restoration Fund bill issued after the final procedures become
effective, which is 30 days after the publication of this notice in the
Federal Register. If a CVP power contractor has paid more during the
interim period than should have been collected under the terms of the
final procedures, that CVP power contractor will not receive an
additional FY 1994 assessment until the over-collection meets the
current FY 1994 obligation. Late payment charges will accrue on
delinquent Restoration Fund payments in accordance with the terms
outlined in the final procedures.
Final Procedures
Acronyms and Definitions
As used herein, the following acronyms and definitions apply:
Assessment Month: The service month which is 1 month prior to the
billing month. The data derived from this service month will serve as
the basis for calculating the monthly Restoration Fund bills.
Billing Month: The month each CVP power contractor will be billed for
the Restoration Fund payment.
CVP: Central Valley Project.
CVP Power Contractor: Any entity purchasing firm capacity and/or energy
from Western for a period in excess of 1 year.
CVP Power Contractor's Restoration Fund Payment: The amount recorded as
payable on the CVP power contractor's Restoration Fund bill.
FY: Fiscal year beginning October 1 and ending September 30.
kWh: Kilowatthour.
Reclamation: Bureau of Reclamation, United States Department of the
Interior.
Restoration Fund: The Central Valley Project Restoration Fund created
by section 3407 of Public Law 102-575, 106 Stat. 4726 et seq.
Restoration Fund Bill: The instrument prepared and issued monthly by
Western as a mechanism for collecting the Restoration Fund payments
from the CVP power contractors.
Total Power Restoration Fund Payment Obligation: The total annual
Restoration Fund payment obligation calculated and assigned to the CVP
power contractors by Reclamation.
Western: Western Area Power Administration, United States Department of
Energy.
Determination of the Total Power Restoration Fund Payment Obligation
Reclamation is responsible for determining the total power
Restoration Fund payment obligation for the CVP power and water
contractors. Prior to each FY Reclamation will, by written
communication, provide to Western's Area Manager, Sacramento Area
Office, the amount determined to be the total power Restoration Fund
payment obligation, and a detailed explanation of the computation of
the amount. Upon receiving the written communication from Reclamation,
Western will notify the CVP power contractors of the total power
Restoration Fund payment obligation, and the multipliers to be used in
assessing that obligation to the CVP power contractors.
Assessing the Total Power Restoration Fund Payment Obligation
Each FY, Western will prorate the total power Restoration Fund
payment obligation to both delivered or scheduled energy and capacity.
Western will assess 50 percent of the total power Restoration Fund
payment obligation to delivered or scheduled energy and 50 percent to
delivered or scheduled capacity. Western will determine an energy and
capacity multiplier based on the prior FY total delivered or scheduled
energy and capacity amounts, adjusted for any anticipated changes in
the CVP power contractor base. The total power Restoration Fund payment
obligation for the current FY to be prorated to energy will be divided
by the adjusted prior FY delivered or scheduled energy to determine the
energy multiplier. The same process will be repeated using the total
power Restoration Fund payment obligation prorated to capacity divided
by the adjusted prior FY delivered or scheduled capacity to determine
the capacity multiplier. During the assessment month, these multipliers
will then be applied to each CVP power contractor's scheduled or
delivered energy and capacity to determine the power contractor's
Restoration Fund payment. The total amount recorded in the assessment
month will be reflected in the CVP power contractor's Restoration Fund
bill.
Assessing the Total Power Restoration Fund Payment Obligation
Reclamation is responsible for determining the total power
Restoration Fund payment obligation for the CVP power and water
contractors. Prior to each FY Reclamation will, by written
communication, provide to Western's Area Manager, Sacramento Area
Office, the amount determined to be the total power Restoration fund
payment obligation, and a detailed explanation of the computation of
the amount. Upon receiving the written communication from Reclamation,
Western will notify the CVP power contractors of the total power
Restoration Fund payment obligation, and the multipliers to be used in
assessing that obligation to the CVP power contractors.
Assessing the Total Power Restoration Fund Payment Obligation
Reclamation is responsible for determining the total power
Restoration Fund payment obligation for the CVP power and water
contractors. Prior to each FY Reclamation will, by written
communication, provide to Western's Area Manager, Sacramento Area
Office, the amount determined to be the total power Restoration fund
payment obligation, and a detailed explanation of the computation of
the amount. Upon receiving the written communication from Reclamation,
Western will notify the CVP power contractors of the total power
Restoration Fund payment obligation, and the multipliers to be used in
assessing that obligation to the CVP power contractors.
Assessing the Total Power Restoration Fund Payment Obligation
Reclamation is responsible for determining the total power
Restoration Fund payment obligation for the CVP power and water
contractors. Prior to each FY Reclamation will, by written
communication, provide to Western's Area Manager, Sacramento Area
Office, the amount determined to be the total power Restoration fund
payment obligation, and a detailed explanation of the computation of
the amount. Upon receiving the written communication from Reclamation,
Western will notify the CVP power contractors of the total power
Restoration Fund payment obligation, and the multipliers to be used in
assessing that obligation to the CVP power contractors.
Assessing the Total Power Restoration Fund Payment Obligation
Reclamation is responsible for determining the total power
Restoration Fund payment obligation for the CVP power and water
contractors. Prior to each FY Reclamation will, by written
communication, provide to Western's Area Manager, Sacramento Area
Office, the amount determined to be the total power Restoration fund
payment obligation, and a detailed explanation of the computation of
the amount. Upon receiving the written communication from Reclamation,
Western will notify the CVP power contractors of the total power
Restoration Fund payment obligation, and the multipliers to be used in
assessing that obligation to the CVP power contractors.
Collection of CVP Power Contractor's Restoration Fund Bill
Each CVP power contractor will receive a Restoration Fund bill on
or about the 25th, but no later than the 30th, of each billing month
designating the amount payable. Within 20 days of the date shown on the
Restoration Fund bill, the total amount payable as set forth on the
bill will be due. The first Restoration Fund billing cycle, for each
FY, will begin at least 30 days after (1) October 1 or (2) the date
written notification of the total power Restoration Fund payment
obligation is received from Reclamation, whichever occurs later.
Payment Due Date
All CVP power contractors' Restoration Fund payments are due and
payable by the CVP power contractors before the close of business on
the 20th calendar day after the date of issuance of each Restoration
Fund bill or the next business day thereafter if said day is a
Saturday, Sunday, or Federal holiday.
Late Payment Charges Assessed to Delinquent Restoration Fund Payments
Western will calculate and assess late payment charges on all CVP
power Restoration Fund payment obligations which are not paid in full
by the due date as specified above. The late payment charge will be the
interest accrued on all unpaid balances and will be compounded
quarterly at the average prime interest rate values published in the
Federal Reserve Bulletin for each calendar quarter.
Deposit of CVP Power Contractor's Restoration Fund Payments into the
Restoration Fund
On or about the 21st day of the month following each billing month,
Western will deposit all of the CVP power contractors' Restoration Fund
payments received, including late payment charges, into the Restoration
Fund.
Adjustment to Collections
By April 30, Western will review the Restoration Fund assessments,
for the period October 1 through March 31. If the actual amount being
assessed is 25 percent greater or less than projected assessments,
Western will adjust the delivered or scheduled energy and capacity
multipliers for the remaining months of the current FY. The CVP power
contractors will be notified by letter, no later than May 15, of any
adjustment to the multipliers. Beginning June 1, and continuing
throughout the balance of the current FY, the adjusted multipliers will
be applied to the CVP power contractors' delivered or scheduled energy
and capacity. All other deviations, in the amounts actually collected
or assessed, will be rolled into the following FY and added to or
subtracted from the amount to be assessed in that FY.
Review Process
Minimally, Western will review the assessment method every 5 years
or if one of the following occurs:
(1) If there is a significant change to or suspension of the
legislation,
(2) If a material issue arises, or
(3) If an apparent inequity in the assessment method is discovered.
Availability of Information
Information regarding this final procedure, including spreadsheet
analysis, comments, letters, memorandums, and other supporting
documents made or kept by Western for the purpose of developing these
procedures, is available for public inspection and copying at Western's
Sacramento Area Office located at 1825 Bell Street, suite 105,
Sacramento, CA 95825-1097.
Regulatory Flexibility Analysis
Pursuant to the Regulatory Flexibility Act of 1980, 5 U.S.C. 601 et
seq., each agency, when required to publish proposed procedures, is
further required to prepare and make available for public comment an
initial regulatory flexibility analysis to describe the impact of the
procedures on small entities. Western has determined that (1) This
rulemaking relates to services offered by Western and, therefore, is
not a rule within the purview of the Act and (2) the impacts of an
assessment from Western would not cause a substantial adverse economic
impact to such entities. The requirements of this Act can be waived if
the head of the agency certifies that the rule will not, if
promulgated, have a significant economic impact on a substantial number
of small entities. By execution of this Federal Register notice,
Western's Administrator certifies that no significant economic impact
on a substantial number of small entities will occur.
Executive Order 12866
DOE has determined that this is not a significant regulatory action
because it does not meet the criteria of Executive Order 12866, 58 FR
51735. Western has an exemption from centralized regulatory review
under Executive Order 12866; accordingly, no clearance of this
procedure by the Office of Management and Budget is required.
Environmental Evaluation
In compliance with the National Environmental Policy Act of 1969,
42 U.S.C. 4321 et seq., and the Council on Environmental Quality
Regulations (40 CFR part 1500-1508), Reclamation is performing a
programmatic environmental impact statement (PEIS) on implementation of
the Act. Western is a cooperating agency in that PEIS. The proposed
procedures for the Restoration Fund payments covered by this notice
fall within Western's routine activities and operations categorical
exclusion issued January 7, 1993, and will have no environmental
impact.
Issued at Golden, Colorado, March 30, 1994.
William H. Clagett,
Administrator.
[FR Doc. 94-8478 Filed 4-7-94; 8:45 am]
BILLING CODE 6450-01-M
