05-9080. Washoe Project-Rate Order No. WAPA-119

AGENCY:

Western Area Power Administration, DOE.

ACTION:

Notice of proposed rates.

SUMMARY:

The Western Area Power Administration (Western) is proposing a minor rate adjustment for non-firm energy from the Stampede Powerplant (Stampede), of the Washoe Project, located in Sierra County, California. The current rates expire September 30, 2005. The rate will provide sufficient revenue to repay all annual costs, including interest expense, and repay required investment within the allowable period. The rate impact is detailed in a rate brochure to be provided to all interested parties. The proposed new rate is scheduled to go into effect October 1, 2005, and will remain in effect through September 30, 2010. Publication of this Federal Register notice begins the formal process for the proposed rates.

DATES:

The consultation and comment period begins today and will end June 6, 2005. Western will accept written comments any time during the consultation and comment period.

ADDRESSES:

Send written comments to Ms. Debbie R. Dietz, Rates Manager, Sierra Nevada Customer Service Region, Western Area Power Administration, 114 Parkshore Drive, Folsom, CA 95630-4710, e-mail [e-mail]. Western will post information about the rate process on its Web site at http://www.wapa.gov/​sn/​customers/​rates/​#currentrates/​. Western will post official comments received via letter and e-mail to its Web site after the close of the comment period. Western must receive the written comments by the end of the consultation and comment period to ensure they are considered in Western's decision process.

FOR FURTHER INFORMATION CONTACT:

Ms. Debbie R. Dietz, Rates Manager, Sierra Nevada Customer Service Region, Western Area Power Administration, 114 Parkshore Drive, Folsom, CA 95630-4710, [phone], e-mail [e-mail].

SUPPLEMENTARY INFORMATION:

Current rates for the sale of non-firm energy from Stampede consist of floor and ceiling rates and are designed to recover an annual revenue requirement. The proposed floor rate for non-firm energy from Stampede is 17.89 mills/kilowatthour (mills/kWh) and on average for the 5-year rate period provides sufficient revenue to pay for 96 percent of annual expenses, excluding interest expense. The current ceiling rate was set by a power repayment study and provides sufficient revenues to repay all annual costs, including interest expense, and the investment within the allowable period.

The Central Valley Project (CVP) Power Marketing Plan states that the output from the Washoe Project remaining after meeting project use loads will be marketed to CVP preference customers. Beginning January 1, 2005, the costs remaining after meeting project use requirements are included in the CVP power revenue requirement (PRR) on an annual basis. This situation makes it unnecessary to establish a new proposed ceiling rate for Stampede. Western's Contract No. 94-SAO-00010 with the Sierra Pacific Resources (Sierra) sets the floor rate. Based on estimated expenses and projected revenues generated from the floor rate, Western anticipates including an annual average cost of $401,000 in the CVP PRR for the 5-year rate case period (fiscal year 2006-2010).

To serve project use loads and market the energy from Stampede, Western's contract with Sierra provides for the Stampede Energy Exchange Account (SEEA). SEEA is an annual energy exchange account for Stampede energy. Under this contract, Sierra accepts delivery of all energy generated from Stampede into Sierra's electrical system. The dollar value of the Stampede energy received by Sierra during any month is credited into the SEEA at the floor rate. Western can use the SEEA to benefit project use facilities and market energy from Stampede to preference entities. The formula for the proposed floor rate, per the contract with Sierra, is equal to 85 percent of the then effective, non-time differentiated rate provided in Sierra's California Quarterly Short-Term Purchase Price Schedule for as-available purchases from qualifying facilities with capacities of 100 kilowatts (kW) or less. This proposed floor rate is used to calculate the value of the SEEA and determines the benefit of Stampede power for project use loads. Western applies the ratio of projected project use costs to the projected revenue recorded in the SEEA to determine a non-reimbursable percentage. This non-reimbursable percentage is then applied to the appropriate power-related costs to determine the reimbursable costs. The reimbursable costs are reduced by revenues from sales made at the floor rate. Under the 2004 CVP Power Marketing Plan, the remaining reimbursable costs and the estimated energy remaining after meeting project use service are then transferred to the CVP PRR.

The propose rate formula for Stampede power is:

Stampede Annual Transferred PRR = Stampede Annual PRR − Stampede Revenue

Where:

Stampede Annual Transferred PRR = Stampede annual costs (Power Revenue Requirement) and associated energy transferred to the CVP.

Stampede Annual PRR = The total power revenue requirement for Stampede required to repay all annual costs, including interest and the investment within the allowable period.

Stampede Revenue = Revenue generated from the floor rate and project generation.

Western will review the total PRR for Stampede annually in or around April of each year. According to Contract No. 94-SAO-00010 that governs SEEA administration, in April of each year, Western is notified of the balance of the SEEA. According to the rate procedures for the CVP, Western will review the CVP PRR in March and September of each year. Western will analyze the CVP financial data from October through February, to the extent information is available, as well as forecasted data for March through September. In the case of Stampede, Western will use the disposition of the SEEA account through February and estimate March through September to determine the amount of costs to be included in the CVP PRR. Again, in September when the next review occurs, Western will use the same methodology to include costs in the CVP PRR. Western estimates the Stampede Annual Transferred PRR for October 2005 through September 2006 to be $401,000.

A comparison of existing and proposed rates follows:

Comparison of Existing and Proposed Rates

[Washoe Project, Stampede Powerplant]

Non-firm existing rates	Existing rates as of 10/1/00 (Mills/kWh)	Proposed rates (effective 10/1/05)	Percent change
Floor Rate (Mills/kWh)	17.89	17.89	0
Ceiling Rate	90.07	N/A	N/A

Legal Authority

Stampede is a feature of the Washoe Project authorized by Congress in 1956 and is located on the Little Truckee River in Sierra County, California. The powerplant has a maximum operating capability of 3,650 kW with an estimated annual generation of 11 million kilowatthours (kWh). Since Stampede has an installed capacity of less than 20,000 kW and generates less than 100 million kWh annually for sale, the proposed rates constitute a minor rate adjustment. Western has determined that it is not necessary to hold a public information or comment forum for this proposed minor rate adjustment as defined by 10 CFR part 903. After review of public comments, and possible amendments or adjustments, Western will recommend the Deputy Secretary of Energy approve proposed rates for non-firm energy from Stampede on an interim basis.

These proposed rates for non-firm energy for Stampede are being established under the Department of Energy Organization Act (42 U.S.C. 7152); the Reclamation Act of 1902 (ch. 1093, 32 Stat. 388), as amended and supplemented by subsequent laws, particularly section 9(c) of the Reclamation Act of 1939 (43 U.S.C. 485h(c)); and other acts that specifically apply to the project involved.

By Delegation Order No. 00-037.00, effective December 6, 2001, the Secretary of Energy delegated: (1) The authority to develop power and transmission rates to Western's Administrator; (2) the authority to confirm, approve, and place such rates into effect, on an interim basis, to the Deputy Secretary of Energy; and (3) the authority to confirm, approve, and place into effect, on a final basis, to remand or to disapprove such rates to the Commission. Existing Department of Energy (DOE) procedures for public participation in power rate adjustments (10 CFR part 903) were published on September 18, 1985 (50 FR 37835).

Availability of Information

All brochures, studies, comments, letters, memorandums, or other documents that Western initiates or uses to develop the proposed rates are available for inspection and copying at the Sierra Nevada Regional Office, located at 114 Parkshore Drive, Folsom, California. Many of these documents and supporting information are also available on the Web site under the “Current Rates” section located at http://www.wapa.gov/​sn/​customers/​rates/​#currentrates/​.

Regulatory Procedure Requirements

Regulatory Flexibility Analysis

The Regulatory Flexibility Act of 1980 (5 U.S.C. 601, et seq.) requires Federal agencies to perform a regulatory flexibility analysis if a final rule is likely to have a significant economic impact on a substantial number of small entities and there is a legal requirement to issue a general notice of proposed rulemaking. This action does not require a regulatory flexibility analysis since it is a rulemaking of particular applicability involving rates or services applicable to public property.

Environmental Compliance

In compliance with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321, et seq.); Council on Environmental Quality Regulations (40 CFR parts 1500-1508); and DOE NEPA Regulations (10 CFR part 1021), Western has determined 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; so this notice requires no clearance by the Office of Management and Budget.

Small Business Regulatory Enforcement Fairness Act

Western has determined this rule is exempt from congressional notification requirements under 5 U.S.C. 801 because the action is a rulemaking of particular applicability relating to rates or services and involves matters of procedure.

Dated: April 25, 2005.

Michael S. Hacskaylo,

Administrator.