2020-15173. Pick-Sloan Missouri Basin Program-Eastern Division-Rate Order No. WAPA-188

AGENCY:

Western Area Power Administration, DOE.

ACTION:

Notice of rate order concerning transmission and ancillary services formula rates.

SUMMARY:

The Assistant Secretary for Electricity confirms, approves, and places into effect, on an interim basis, the formula rates for the Pick-Sloan Missouri Basin Program—Eastern Division (P-SMBP—ED) transmission and ancillary services (Provisional Formula Rates). These rates will be used by Western Area Power Administration's (WAPA) Upper Great Plains Region (UGP) to provide rate data to Southwest Power Pool, Inc. (SPP), the Regional Transmission Organization of which UGP is a member. These new formula rates replace the existing transmission and ancillary services formula rates under Rate Order No. WAPA-170 that expire on September 30, 2020.

DATES:

The Provisional Formula Rates under Rate Schedules WAUGP-ATRR, WAUGP-AS1, WAUW-AS3, WAUW-AS4, WAUW-AS5, WAUW-AS6 and WAUW-AS7 are effective October 1, 2020, and will remain in effect through September 30, 2025, pending confirmation and approval by the Federal Energy Regulatory Commission (FERC) on a final basis or until superseded.

FOR FURTHER INFORMATION CONTACT:

Mr. Jody Sundsted, Regional Manager, Upper Great Plains Region, Western Area Power Administration, 2900 4th Avenue North, Billings, MT 59101-1266; [phone]; email: [e-mail], or Linda Cady-Hoffman, Rates Manager, Upper Great Plains Region, telephone: [phone]; email: [e-mail].

SUPPLEMENTARY INFORMATION:

On November 19, 2015, FERC confirmed and approved Rate Schedules WAUGP-ATRR, WAUGP-AS1, WAUW-AS3, WAUW-AS4, WAUW-AS5, WAUW-AS6 and WAUW-AS7 under Rate Order No. WAPA-170 on a final basis effective for a 5-year period through September 30, 2020.^[1] Those schedules consisted of separate formula-based rates for transmission and ancillary services for the transmission facilities in the P-SMBP—ED that UGP transferred to the functional control of SPP. The new rates continue the formula-based methodology that includes an annual update to the financial data in the rate formulas. The charges under these rates will be annually updated January 1 of each year beginning 2021 and thereafter. The formula rates provide sufficient revenue to recover annual expenses, including interest expense, and repay capital investments within the cost recovery criteria set forth in Department of Energy (DOE) Order RA 6120.2.

Legal Authority

By Delegation Order No. 00-037.00B, effective November 19, 2016, the Secretary of Energy delegated: (1) The authority to develop power and transmission rates to WAPA'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 on a final basis, remand, or disapprove such rates to FERC. In Delegation Order No. 00-002.00S, effective January 15, 2020, the Secretary of Energy also delegated the authority to confirm, approve, and place such rates into effect on an interim basis to the Under Secretary of Energy. By Redelegation Order No. 00-002.10E, effective February 14, 2020, the Under Secretary of Energy further delegated the authority to confirm, approve, and place such rates into effect on an interim basis to the Assistant Secretary for Electricity. This rate action is issued under the Redelegation Order and DOE's procedures for public participation in rate adjustments set forth at 10 CFR part 903.^[2]

Following DOE's review of WAPA's proposal, I hereby confirm, approve, and place Rate Order No. WAPA-188, which provides the formula rates for transmission and ancillary services, into effect on an interim basis. WAPA will submit Rate Order No. WAPA-188 to FERC for confirmation and approval on a final basis.

Signing Authority

This document of the Department of Energy was signed on July 9, 2020, by Bruce J. Walker, Assistant Secretary for Electricity, pursuant to delegated authority from the Secretary of Energy. That document, with the original signature and date, is maintained by DOE. For administrative purposes only, and in compliance with requirements of the Office of the Federal Register, the undersigned DOE Federal Register Liaison Officer has been authorized to sign and submit the document in electronic format for publication, as an official document of the Department of Energy. This administrative process in no way alters the legal effect of this document upon publication in the Federal Register.

Signed in Washington, DC, on July 9, 2020.

Treena V. Garrett,

Federal Register Liaison Officer, U.S. Department of Energy.

DEPARTMENT OF ENERGY

In the matter of:

Western Area Power Administration Rate Adjustment for the Pick-Sloan Missouri Basin Program—Eastern Division Transmission and Ancillary Services Formula Rates;

[Rate Order No. WAPA-188]

Order Confirming, Approving, and Placing the Transmission and Ancillary Services Formula Rates for the Pick-Sloan Missouri Basin Program—Eastern Division Into Effect on an Interim Basis

The formula rates in Rate Order No. WAPA-188 are established following section 302 of the Department of Energy (DOE) Organization Act (42 U.S.C. 7152).^[3]

By Delegation Order No. 00-037.00B, effective November 19, 2016, the Secretary of Energy delegated: (1) The authority to develop power and transmission rates to the Western Area Power Administration's (WAPA) Administrator; (2) the authority to confirm, approve, and place into effect such rates on an interim basis to the Deputy Secretary of Energy; and (3) the authority to confirm, approve on a final basis, remand, or disapprove such rates to the Federal Energy Regulatory Commission (FERC). In Delegation Order No. 00-002.00S, effective January 15, 2020, the Secretary of Energy also delegated the authority to confirm, approve, and place such rates into effect on an interim basis to the Under Secretary of Energy. By Redelegation Order No. 00-002.10E, effective February 14, 2020, the Under Secretary of Energy further delegated the authority to confirm, approve, and place such rates into effect on an interim basis to the Assistant Secretary for Electricity. This rate action is issued under the Redelegation Order and DOE's procedures for public participation in rate adjustments set forth at 10 CFR part 903.^[4]

Acronyms, Terms, and Definitions

As used in this Rate Order, the following acronyms, terms, and definitions apply:

$/MW-year: Annual charge for capacity (i.e., $ per megawatt (MW) per year).

ATRR: Annual Transmission Revenue Requirement is the net revenue requirement for the Transmission Services calculated in accordance with the Formula Rate.

BA: Balancing Authority—The responsible entity that integrates resource plans ahead of time, maintains load-interchange-generation balance within a designated area, and supports interconnection frequency in real-time.

Balancing Authority Area: An electric system or systems, bounded by interconnection metering and telemetry, capable of controlling generation to maintain its interchange schedule with other Balancing Authorities and contributing to frequency regulation of the Interconnection.

Capacity: The electric capability of a generator, transformer, transmission circuit, or other equipment. It is expressed in kilowatts (kW).

Corps: U.S. Army Corps of Engineers.

DOE: United States Department of Energy.

Energy: Power produced or delivered over a period of time. Measured in terms of the work capacity over a period of time. Electric energy is expressed in kilowatt-hours.

Energy Imbalance Service: A service that provides energy correction for any hourly mismatch between a Southwest Power Pool Transmission Customer's energy supply and the demand served.

FERC: Federal Energy Regulatory Commission.

FRN: Federal Register notice.

Generator Imbalance Service: A service that provides energy correction for any hourly mismatch between generator output and a delivery schedule from that generator to another Balancing Authority Area or to a load within the same Balancing Authority Area.

kW: Kilowatt—the electrical unit of capacity that equals 1,000 watts.

kWh: Kilowatt-hour—the electrical unit of energy that equals 1,000 watts in 1 hour.

Load: The amount of electric power or energy delivered or required at any specified point(s) on a system.

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).

OASIS: Open Access Same-Time Information System—An electronic posting system that a service provider maintains for transmission access data that allows all customers to view information simultaneously.

P-SMBP: Pick-Sloan Missouri Basin Program.

P-SMBP—ED: Pick-Sloan Missouri Basin Program—Eastern Division.

Provisional Formula Rate: A formula rate that has been confirmed, approved, and placed into effect on an interim basis by the Assistant Secretary for Electricity.

Rate Brochure: A document prepared for public distribution explaining the rationale and background for the rate proposal contained in this rate order.

Regulation and Frequency Response Service: A service that provides for following the moment-to-moment variations in the demand or supply in a Balancing Authority Area and maintaining scheduled interconnection frequency.

Reserve Services: Spinning Reserve Service and Supplemental Reserve Service.

Revenue Requirement: The revenue required to recover annual expenses (such as operation and maintenance, purchase power, transmission service expenses, interest expense, and deferred expenses) and repay Federal investments, and other assigned costs.

Schedule: An agreed-upon transaction size (megawatts), beginning and ending ramp times and rate, and type of service required for delivery and receipt of power between the contracting parties and the Balancing Authority(ies) involved in the transaction.

Scheduling, System Control and Dispatch Service: A service that provides for (a) scheduling, (b) confirming and implementing an interchange schedule with other balancing authorities, including intermediary balancing authorities providing transmission service, and (c) ensuring operational security during the interchange transaction.

Southwest Power Pool, Inc. (SPP): A Regional Transmission Organization.

SPP's Integrated Marketplace (Integrated Marketplace): The SPP Energy and Operating Reserve Markets and the Transmission Congestion Rights Markets.

Spinning Reserve Service: Generation capacity needed to serve load immediately in the event of a system contingency. Spinning Reserve Service may be provided by generating units that are on-line and loaded at less than maximum output.

Supplemental Reserve Service: Generation capacity needed to serve load in the event of a system contingency; however, it is not available immediately to serve load but rather within a short period of time. Supplemental Reserve Service may be provided by generation units that are on-line but unloaded, by quick start generation or by interruptible load.

SPP Tariff: Southwest Power Pool, Open Access Transmission Tariff, approved by FERC.

SPP Transmission Customer: Any eligible customer (or its designated agent) that receives transmission service under the SPP Tariff.

Transmission Provider: Any utility that owns, operates, or controls facilities used to transmit electric energy in interstate commerce. SPP is the Transmission Provider under the SPP Tariff.

Transmission System: The facilities owned, controlled, or operated by the transmission owner or Transmission Provider that are used by the Transmission Provider to provide transmission service.

UMZ: Upper Missouri Zone—Multi-owner zone in SPP in which WAPA-UGP participates as a Transmission Owner; also defined as Zone 19 under the SPP Tariff. The UMZ includes transmission facilities located in both the Eastern and Western Interconnections.

WAUW: Western Area Power Administration, Upper Great Plains West Balancing Authority Area. WAUW is located in the Western Interconnection.

WAPA: United States Department of Energy, Western Area Power Administration.

Western Interconnection: A major alternating current power grid in North America. The Western Interconnection stretches from Western Canada south to Baja California in Mexico, reaching eastward over the Rockies to the Great Plains. Western Interconnection is comprised of the states of Washington, Oregon, California, Idaho, Nevada, Utah, Arizona, Colorado, Wyoming, portions of Montana, South Dakota, Nebraska, New Mexico and Texas in the United States, the Provinces of British Columbia and Alberta in Canada, and a portion of the Comisión Federal de Electricidad's system in Baja California in Mexico.

WAPA-UGP: United States Department of Energy, Western Area Power Administration, Upper Great Plains Region. Western-UGP is the definition for WAPA's Upper Great Plains Region in the SPP Tariff.

Effective Date

The Provisional Formula Rate Schedules WAUGP-ATRR, WAUGP-AS1, WAUW-AS3, WAUW-AS4, WAUW-AS5, WAUW-AS6 and WAUW-AS7 are effective October 1, 2020, and will remain in effect through September 30, 2025, pending approval by FERC on a final basis or until superseded.

Public Notice and Comment

WAPA followed the Procedures for Public Participation in Power and Transmission Rate Adjustments and Extensions, 10 CFR part 903, in developing these formula rates. Following are the steps WAPA took to involve interested parties in the rate process:

1. On August 22, 2019, a Federal Register notice (84 FR 43803) (Proposal FRN) announced the proposed formula rates and launched the 90-day public consultation and comment period.

2. On August 23, 2019, WAPA notified all P-SMBP—ED customers and interested parties of the proposed rates and provided a copy of the Proposal FRN.

3. On September 24, 2019, WAPA held a public information forum in Omaha, Nebraska, and on September 25, 2019, WAPA held a public information forum in Bismarck, North Dakota. WAPA representatives explained the proposed formula rates, answered questions, and gave notice that more information was available in the customer Rate Brochure.

4. On September 24, 2019, WAPA held a public comment forum in Omaha, Nebraska, and on September 25, 2019, WAPA held a public comment forum in Bismarck, North Dakota. This provided customers and other interested parties with opportunity to comment for the record.

5. WAPA posted information about this rate process that contains all dates, customer letters, presentations, FRNs, customer Rate Brochure, and other information about this rate process at the following locations: (a) WAPA-UGP's OASIS at: http://www.oasis.oati.com/​wapa/​index.html;​; (b) WAPA-UGP's Rates web page at: https://www.wapa.gov/​regions/​UGP/​rates/​Pages/​rates.aspx;​; and (c) the “Western Area Power Administration UGP Information” link on SPP's Member Related Postings website at: http://opsportal.spp.org/​OASIS/​Directory/​Member%20Related%20Postings.

6. During the 90-day consultation and comment period, which ended on November 20, 2019, WAPA received one oral comment (at the September 24th public comment forum) and one written set of comments. The comments and WAPA's responses are addressed below. All comments have been considered in the preparation of this Rate Order.

One representative of the following organization made oral comments: Missouri River Energy Services (MRES).

Written comments were received from the following interested parties: Missouri River Energy Services (MRES).

Project Description

The initial stages of the Missouri River Basin Project were authorized by section 9 of the Flood Control Act of 1944 (58 Stat. 887, 890, Pub. L. 78-534). It was later renamed the P-SMBP. The P-SMBP is a comprehensive program with the following authorized functions: Flood control, navigation improvement, irrigation, municipal and industrial water development, and hydroelectric production for the entire Missouri River Basin.

WAPA-UGP owns and operates an extensive system of high-voltage transmission facilities that it uses to market significant quantities of Federally-generated hydroelectric power from the P-SMBP—ED.

WAPA-UGP is a Transmission Owner member of SPP pursuant to negotiated provisions in its SPP Membership Agreement and the SPP Bylaws and SPP Open Access Transmission Tariff (SPP OATT). Transmission and ancillary services are provided by SPP under the SPP OATT for WAPA-UGP's facilities transferred to the functional control of SPP. WAPA-UGP has transmission facilities in both the Eastern and Western Interconnections separated by the Miles City direct current tie and the Fort Peck Power Plant substation. WAPA-UGP operates its Western Area Power Administration, Upper Great Plains West (WAUW) Balancing Authority Area in the Western Interconnection as the Balancing Authority (BA), and has not placed the portion of its transmission system located in the Western Interconnection into SPP's Integrated Marketplace. WAPA-UGP still provides ancillary services associated with its WAUW in the Western Interconnection as the BA.

WAPA-UGP's formula rates for transmission and ancillary services will be applied so WAPA-UGP's costs can continue to be recovered under the SPP OATT. WAPA-UGP's revenue requirements are added to the annual revenue requirements of other transmission owners in the multi-owner SPP pricing Zone 19, also identified as the Upper Missouri Zone (UMZ), for transmission service billed by SPP within the UMZ. WAPA-UGP's revenue requirements under these proposed rates also impact other costs for transmission service within the broader SPP footprint. The formula rates provide WAPA-UGP sufficient revenue to pay all annual costs, including interest expenses, and repay investment.

P-SMBP—ED Transmission and Ancillary Services Rate Studies

Existing Rate Schedules WAUGP-ATRR, WAUGP-AS1, WAUW-AS3, WAUW-AS4, WAUW-AS5, WAUW-AS6 and WAUW-AS7 were approved under Rate Order No. WAPA-170 for a 5-year period beginning on October 1, 2015, and ending September 30, 2020. Those rate schedules consisted of separate formula-based rates for transmission service and ancillary services for the transmission facilities in the P-SMBP—ED that WAPA-UGP transferred to the functional control of SPP. The new rates continue the formula-based methodology that includes an annual update to the financial data in the rate formulas with only limited changes to: (1) The Formula Rate Templates (Templates) to increase transparency through addition of financial data source detail; (2) the Formula Rate Implementation Protocols (Protocols) to clarify WAPA-UGP's rate implementation and annual update procedures; (3) the Operating Reserves formula rates to incorporate costs associated with WAPA-UGP's current reserve sharing group membership; and (4) the rate schedules for Energy Imbalance and Generator Imbalance to accommodate participation in a Western Interconnection energy imbalance service market.

WAPA prepared Transmission and Ancillary Services rates studies to ensure that the formula rates are based on the cost of service of the WAPA-UGP eligible transmission facilities that are included in the UMZ and the associated operation of the WAUW. These studies included all applicable expenses and associated offsetting revenues.

Provisional Rates

The revenue requirements for 2020 for the individual services are outlined in the following table.

Provisional WAPA-UGP Transmission and Ancillary Services Formula Rates

Service	Rate schedule No.	Provisional 2020 annual revenue requirement
Transmission	WAUGP-ATRR	$136,325,626—SPP Sched 9; $666,093—SPP Sched 11 (Zonal); $111,344—SPP Sched 11 (Regional).
Scheduling, System Control, and Dispatch	WAUGP-AS1	$11,534,163.
Regulation and Frequency Response	WAUW-AS3	$291,973.
Operating Reserves—Spinning and Supplemental Reserves	WAUW-AS5 and WAUW-AS6	$409,789.
Energy Imbalance	WAUW-AS4	N/A.
Generator Imbalance	WAUWA-AS7	N/A.

Transmission and Ancillary Rate Discussion

WAPA-UGP includes facilities in the UMZ ATRR calculation that meet Transmission Facility criteria as identified in Attachment AI to SPP's OATT. WAPA-UGP identifies any portion of the ATRR eligible for recovery under SPP Schedule 11 pursuant to the SPP OATT in its Rate Formula Template submitted under Attachment H of the SPP OATT.

WAPA-UGP will true-up the cost estimates with actual costs. Revenue collected in excess of WAPA-UGP's actual net revenue requirement will be returned to customers through a credit against a revenue requirement in a subsequent year. Actual revenues that are less than the net revenue requirement would likewise be recovered in a subsequent year. The true-up procedure will ensure that WAPA-UGP will recover no more and no less than the actual transmission costs for the year.

Data used in the annual recalculation of the formula rate effective on January 1 each year will be made available for review and comment on or around September 1 each year as described in the Protocols. WAPA-UGP will provide customers the opportunity to discuss and comment on the recalculated rates on or before November 15, 2020, and annually by November 15 of subsequent years as described in the Protocols. The Protocols that describe the meetings where customers have opportunity to discuss and comment are available online at the following locations: (1) WAPA-UGP's OASIS at: http://www.oasis.oati.com/​wapa/​index.html;​; (2) WAPA-UGP's Rates web page at: https://www.wapa.gov/​regions/​UGP/​rates/​Pages/​rates.aspx;​; and (3) the “Western Area Power Administration UGP Information” link on SPP's Member Related Postings website at: http://opsportal.spp.org/​OASIS/​Directory/​Member%20Related%20Postings. This procedure ensures that interested parties are aware of the data used to calculate the rates. This also provides interested parties the opportunity to comment before the costs are collected through the formula rate.

Formula Transmission Rate

WAPA-UGP will continue to use its current formula rate calculation methodology for its ATRR, provided under Rate Schedule WAUGP-ATRR. This rate schedule includes WAPA-UGP's transmission facilities in both the Eastern and Western Interconnections that are transferred to the functional control of SPP and used by SPP in order to provide transmission service in the UMZ under the SPP OATT. Consistent with WAPA-UGP's existing formula rate, WAPA-UGP will continue recovering transmission system expenses and investments on a forward-looking basis by using projections to estimate transmission costs for the upcoming year, with a true-up of incurred costs in a subsequent year. Transmission-related annual costs include operation and maintenance, interest, administrative and general costs, and depreciation. Cost data is submitted to SPP in standard revenue requirement templates and classified as either “Zonal” or “Regional” costs as defined under the SPP OATT. “Zonal” costs are recovered within the local pricing zone while “Regional” costs are recovered across the entire SPP footprint. The ATRR Formula Rate Template includes breakouts of the annual revenue requirement for each individual Base Plan Upgrade, as defined under the SPP OATT, assigned to and funded by WAPA-UGP, along with “Regional” and “Zonal” allocation of the total net annual revenue requirement for each Project.

Formula Rate Implementation Protocols

For transmission and ancillary services provided under the SPP OATT, WAPA-UGP will continue to provide information relating to WAPA-UGP's rate implementation and annual updates in Formula Rate Implementation Protocols (Protocols), which together with the Formula Rate Templates (Templates), comprise the Formula Rates that are submitted to SPP to be incorporated in the SPP OATT. WAPA-UGP changed its Protocols to clarify and include additional detail regarding WAPA-UGP's rate implementation and annual update procedures. WAPA-UGP was one of the first transmission owners in the UMZ to develop Protocols. Therefore, WAPA-UGP updated its Protocols to be more consistent with the protocols of other transmission owners in the UMZ that were developed and approved after WAPA-UGP joined SPP.

Formula Rate for Scheduling, System Control, and Dispatch Service

WAPA-UGP will continue to use a formula-based rate methodology to calculate its annual revenue requirement for Scheduling, System Control, and Dispatch Service (SSCD), provided under Rate Schedule WAUGP-AS1 for the SPP UMZ. This rate schedule also includes transmission facilities in the WAUW.

SSCD is required to schedule the movement of power through, out of, within, or into the SPP and/or WAUW Balancing Authority Area(s). WAPA-UGP's annual revenue requirement for SSCD is utilized by SPP to calculate the regional SPP Schedule 1 rate for the UMZ. WAPA-UGP's annual revenue requirement for SSCD is derived by annualizing WAPA-UGP's applicable transmission-related annual costs associated with the provision of SSCD service, including operation and maintenance, interest, administrative and general costs, and depreciation. Estimates are calculated on a forward-looking basis by using projections to determine applicable transmission-related costs associated with SSCD for the upcoming year, with a true-up in a subsequent year, to be provided to SPP for inclusion in Schedule 1 under the SPP Tariff.

WAPA-UGP will true-up the cost estimates with WAPA-UGP's actual costs. Revenue collected in excess of WAPA-UGP's actual net revenue requirement will be returned to customers through a credit against a revenue requirement in a subsequent year. Actual revenues that are less than the net revenue requirement would likewise be recovered in a subsequent year. The true-up procedure will ensure that WAPA-UGP will recover no more and no less than the actual costs for the year. WAPA-UGP included additional information regarding implementation and annual updates for SSCD in its revised Protocols.

Formula Rate for Regulation and Frequency Response Service

WAPA-UGP will continue to use a formula-based rate methodology for Regulation and Frequency Response Service (Regulation) for the WAUW, provided under Rate Schedule WAUW-AS3. WAPA-UGP provides Regulation and Frequency Response Service in the WAUW as the BA. Regulation and Frequency Response Service in the WAUW is provided primarily by Corps facilities. Under the formula rate methodology, the Corps' generation fixed charge rate (in percent) is applied to the net plant investment of the Corps generation to derive an annual Corps generation cost. This cost is divided by the capacity at the plants to derive a dollar-per-megawatt amount for Corps-installed capacity ($/MW-year). This dollar-per-megawatt amount is applied to the capacity of Corps generation reserved for Regulation and Frequency Response Service in the WAUW, producing the annual Corps generation cost for this service. WAPA-UGP's annual revenue requirement is recovered under the SPP Tariff under Rate Schedule WAUW-AS3.

Regulation and Frequency Response Service is necessary to provide for the continuous balancing of resources, generation, and interchange with load and for maintaining scheduled interconnection frequency at 60 cycles per second (60 Hz). Regulation is accomplished by committing on-line generation whose output is raised or lowered, predominantly through the use of automatic generating control equipment, as necessary, to follow the moment-by-moment changes in load. The obligation to maintain this balance between resources and load lies with the WAPA-UGP as the WAUW operator. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Regulation obligation. WAPA-UGP's annual revenue requirement for Regulation will be used by SPP to calculate the WAUW charges for Regulation. WAPA-UGP included additional information regarding implementation and annual updates for Regulation in its revised Protocols.

WAPA-UGP will true-up the cost estimates with WAPA-UGP's actual costs. Revenue collected in excess of WAPA-UGP's actual net revenue requirement will be returned through a credit in a subsequent year. Actual revenues that are less than the net revenue requirement would likewise be recovered in a subsequent year. The true-up procedure will ensure that WAPA-UGP will recover no more and no less than the actual costs for the year.

WAPA-UGP supports the installation of renewable sources of energy but recognizes that certain operational constraints exist in managing the significant fluctuations that are a normal part of their operation. When WAPA-UGP purchases power resources to provide Regulation to intermittent resources serving load within WAPA-UGP's WAUW, costs for these regulation resources will become part of WAPA's Regulation revenue requirement, which will be billed by SPP, as the Transmission Provider, to a SPP Transmission Customer along with the associated transmission service provided by SPP under the SPP Tariff. However, WAPA-UGP will not regulate for the difference between the output of an intermittent resource located within WAPA-UGP's WAUW and a delivery schedule from that generator serving load located outside of WAPA-UGP's WAUW. Intermittent resources serving load outside WAPA-UGP's WAUW will be required to be pseudo-tied or dynamically scheduled to another Balancing Authority Area.

An intermittent resource, for the limited purpose of this rate schedule, is an electric generator that is not dispatchable and cannot store its fuel source and, therefore, cannot respond to changes in demand or respond to transmission security constraints.

Formula Rate for Energy Imbalance Service

WAPA-UGP will continue to use its current formula rate calculation methodology for Energy Imbalance Service (Energy Imbalance), which is provided under Rate Schedule WAUW-AS4. This rate schedule addresses Energy Imbalance associated with UGP's WAUW in the Western Interconnection. WAPA-UGP also revised Rate Schedule WAUW-AS4 to accommodate participation in a Western Interconnection energy imbalance service market by WAPA-UGP as the BA. WAPA-UGP is providing additional information regarding implementation and annual updates for Energy Imbalance in its revised Protocols.

Energy Imbalance Service is provided when a difference occurs between the scheduled and the actual delivery of energy to a load located within WAPA-UGP's WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable). Given the SPP Integrated Marketplace does not extend into the Western Interconnection, WAPA-UGP as the BA, will offer to provide Energy Imbalance Service in the WAUW at the request of SPP, if it is capable of doing so, from its own resources or from resources available to it including possible participation in a Western Interconnection energy imbalance market. SPP is the Transmission Provider for the eligible WAPA-UGP facilities transferred to the functional control of SPP in the WAUW. Energy Imbalance Service is needed when transmission service is provided by SPP and used to serve load within the WAUW, or when a difference occurs between the expected and actual delivery of energy to/from the WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable) in the event that WAPA-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the BA. Energy Imbalance Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP, or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Energy Imbalance Service Obligation.

The SPP Transmission Customer will incur a charge for either hourly energy imbalances under this Schedule, WAUW-AS4, or hourly generator imbalances under Rate Schedule WAUW-AS7 for imbalances occurring during the same hour, but not both, unless the imbalances aggravate rather than offset each other.

This Rate Order puts in place two options for how Energy Imbalance Service in the WAUW may be provided:

(A) In the event that WAPA-UGP does not participate in a Western Interconnection energy imbalance market in the WAUW as the BA, or such energy imbalance market is unable to provide the total energy imbalance requirements for certain loads and generation within the Balancing Authority Area:

The rate for service will be based up deviation bands as follows: (i) Deviations within +/−1.5 percent (with a minimum of 2 MW) of the scheduled transaction to be applied hourly to any energy imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be netted on a monthly basis and settled financially, at the end of the month, at 100 percent of the average incremental cost for the month; (ii) deviations greater than +/−1.5 percent up to 7.5 percent (or greater than 2 MW up to 10 MW) of the scheduled transaction(s) to be applied hourly to any energy imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled financially, at the end of each month, at a charge of 110 percent of incremental cost when energy taken by the SPP Transmission Customer in a schedule hour is greater than the energy scheduled or a credit of 90 percent of incremental cost when energy taken by a SPP Transmission Customer in a schedule hour is less than the scheduled amount; and (iii) deviations greater than +/−7.5 percent (or 10 MW) of the scheduled transaction to be applied hourly to any energy imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled at 125 percent of WAPA-UGP's incremental cost when energy taken by the SPP Transmission Customer in a schedule hour that is greater than the energy scheduled, or 75 percent of WAPA-UGP's incremental cost when energy taken by a SPP Transmission Customer is less than the scheduled amount.

WAPA-UGP's incremental cost will be based on a representative hourly energy index or combination of indexes. The index to be used, or any change to the index, will be posted on the applicable SPP website and WAPA-UGP's OASIS at least 30 days before use for determining the WAPA-UGP incremental cost and will not be changed more often than once per year unless WAPA-UGP determines that the existing index is no longer a reliable price index.

(B) In the event that WAPA-UGP participates in a Western Interconnection energy imbalance market in the WAUW as the BA: Charges to the SPP Transmission Customer will reflect only the pass-through of the applicable charges associated with the Western Interconnection energy imbalance service market assessed to WAPA-UGP as the WAUW BA for embedded load and/or generation in the WAUW of such SPP Transmission Customer that does not make adequate alternate arrangements in such Western Interconnection energy imbalance service market or other alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Energy Imbalance Service obligation.

WAPA-UGP will post notice on the applicable SPP website and WAPA-UGP's OASIS, and also notify existing SPP Transmission Customers, at least 30 days before WAPA-UGP participates in a Western Interconnection energy imbalance service market, as the BA. WAPA-UGP will also post information related to the charges assessed by the market operator for Energy Imbalance Service in the WAUW under such Western Interconnection energy imbalance service market.

WAPA-UGP will follow Option A above beginning on October 1, 2020. WAPA-UGP will follow Option B above in the event that WAPA-UGP participates in a Western Interconnection energy imbalance market.

Formula Rate for Generator Imbalance Service

WAPA-UGP will continue to use its current formula rate calculation methodology for Generator Imbalance Service (Generator Imbalance), which is provided under Rate Schedule WAUW-AS7. This rate schedule addresses Generator Imbalance associated with WAPA-UGP's WAUW in the Western Interconnection. WAPA-UGP also changed Rate Schedule WAUW-AS7 to accommodate participation in a Western Interconnection energy imbalance market by WAPA-UGP as the BA. WAPA-UGP is providing additional information regarding implementation and annual updates for Generator Imbalance in its revised Protocols.

Generator Imbalance Service is provided when a difference occurs between the output of a generator located within WAPA-UGP's WAUW and a delivery schedule from that generator to: (1) Another Balancing Authority Area or (2) a load within WAPA-UGP'S WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable). Given the SPP Integrated Marketplace does not extend into the Western Interconnection, WAPA-UGP, as the BA, will offer to provide this service at the request of SPP, if it is capable of doing so, from its own resources or resources available to it, including possible participation in a Western Interconnection energy imbalance service market. SPP is the Transmission Provider for the eligible WAPA-UGP facilities transferred to the functional control of SPP in the WAUW. Generator Imbalance Service is needed when transmission service is provided by SPP and used to deliver energy from a generator located within the WAUW, or when a difference occurs between the expected and actual delivery of energy to/from the WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable) in the event that WAPA-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the BA. Generator Imbalance Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service. The SPP Transmission Customer must either purchase this service from SPP, or make alternative comparable arrangements pursuant to the SPP Tariff, to satisfy its Generator Imbalance Service obligation. The SPP Transmission Customer will incur a charge for either hourly generator imbalances under this rate schedule, WAUW-AS7, or hourly energy imbalances under Rate Schedule WAUW-AS4 for imbalances occurring during the same hour, but not both, unless the imbalances aggravate rather than offset each other.

WAPA-UGP supports the installation of renewable sources of energy but recognizes that certain operational constraints exist in managing the significant fluctuations that are a normal part of their operation. WAPA-UGP has marketed the maximum practical amount of power from each of its projects, leaving little or no flexibility for provision of additional power services. Consequently, WAPA-UGP will not regulate for the difference between the output of an intermittent generator located within the WAUW and a delivery schedule from that generator serving load located outside of the WAUW. Intermittent resources serving load outside WAPA-UGP's WAUW will be required to be pseudo-tied or dynamically scheduled to another Balancing Authority Area.

An intermittent resource, for the limited purpose of this rate schedule, is an electric generator that is not dispatchable and cannot store its fuel source and, therefore, cannot respond to changes in system demand or respond to transmission security constraints.

This Rate Order puts in place two options for how Generator Imbalance Service in the WAUW may be provided:

(A) In the event that WAPA-UGP does not participate in a Western Interconnection energy imbalance service market in the WAUW as the BA, or such energy imbalance market is unable to provide the total energy imbalance requirements for certain loads and generation within the Balancing Authority Area:

The rate for service will be based on deviation bands as follows: (i) For deviations within +/−1.5 percent (with a minimum of 2 MW) of the scheduled transaction to be applied hourly to any generator imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be netted on a monthly basis and settled financially, at the end of the month, at 100 percent of the average incremental cost; (ii) deviations greater than +/−1.5 percent up to 7.5 percent (or greater than 2 MW up to 10 MW) of the scheduled transaction to be applied hourly to any generator imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled financially, at the end of each month, as a charge of 110 percent of incremental cost when energy delivered in a schedule hour from the generation resource is less than the energy scheduled or a credit of 90 percent of the incremental cost when energy delivered from the generation resource is greater than the scheduled amount; and (iii) deviations greater than +/−7.5 percent (or 10 MW) of the scheduled transaction to be applied hourly to any generator imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled at 125 percent of WAPA-UGP's highest incremental cost for the day when energy delivered in a schedule hour is less than the energy scheduled or 75 percent of WAPA-UGP's lowest daily incremental cost when energy delivered from the generation resource is greater than the scheduled amount. An intermittent resource will be exempt from this deviation band and will pay the deviation band charges for all deviations greater than the larger of 1.5 percent or 2 MW.

Deviations from scheduled transactions responding to directives by the Transmission Provider, a BA, or a reliability coordinator will not be subject to the deviation bands identified above and, instead, will be settled financially at the end of the month at 100 percent of incremental cost. Such directives may include instructions to correct frequency decay, respond to a reserve sharing event, or change output to relieve congestion.

WAPA-UGP's incremental cost will be based on a representative hourly energy index or combination of indexes. The index to be used, or any change to the index, will be posted on the applicable SPP website and WAPA-UGP's OASIS at least 30 days before use for determining the WAPA-UGP incremental cost and will not be changed more often than once per year unless WAPA-UGP determines that the existing index is no longer a reliable price index.

(B) In the event that WAPA-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the BA: Charges to the SPP Transmission Customer will reflect only the pass-through of the applicable charges associated with the Western Interconnection energy imbalance service market assessed to WAPA-UGP as the WAUW BA for embedded load and/or generation in the WAUW of such SPP Transmission Customer that does not make adequate alternate arrangements in such Western Interconnection energy imbalance service market or other alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Generator Imbalance Service Obligation.

WAPA-UGP will post notice on the applicable SPP website and WAPA-UGP's OASIS, and also notify existing Transmission Customers, at least 30 days before WAPA-UGP participates in a Western Interconnection energy imbalance service market, as the BA. WAPA-UGP will also post information related to the charges assessed by the market operator for Generator Imbalance Service in the WAUW under such Western Interconnection energy imbalance service market.

WAPA-UGP will follow Option A above beginning on October 1, 2020. WAPA-UGP will follow Option B above in the event that WAPA-UGP participates in a Western Interconnection energy imbalance service market.

Formula Rates for Operating Reserves Service—Spinning and Supplemental

WAPA-UGP will continue to use its current formula rate calculation methodologies for Operating Reserve—Spinning Reserve Service and Operating Reserve—Supplemental Reserve Service (collectively, Operating Reserves) provided under Rate Schedules WAUW-AS5 and WAUW-AS6, respectively, with changes to the rate formulas to incorporate costs associated with its current reserve sharing group membership. These rate schedules address Operating Reserves associated with WAPA-UGP's WAUW in the Western Interconnection. WAPA-UGP changed the rate formulas to incorporate costs associated with its current reserve sharing group membership. In addition, WAPA-UGP included additional information regarding implementation and annual updates for Operating Reserves in its revised Protocols. Given the SPP Integrated Marketplace does not extend into the Western Interconnection, WAPA-UGP will continue to provide Operating Reserves in the WAUW as the BA. WAPA-UGP utilizes the reserve requirement of the reserve sharing group of which WAPA-UGP is currently a member for its transmission system in the Western Interconnection.

WAPA-UGP's annual cost of generation for Reserve Services is determined by multiplying the Corps' generation fixed charge rate (in percent) by the net plant investment of the Corps generation producing an annual Corps generation cost. This cost is divided by the capacity at the plants to derive a dollar-per-megawatt amount for Corps installed capacity ($/MW-year). This dollar-per-megawatt amount is then applied to the capacity of Corps generation reserved for Reserve Services in the WAUW, producing the annual Corps generation cost to provide this service. WAPA-UGP's annual revenue requirement for Reserve Services is then determined by taking the annual Corps generation cost to provide this service and adding costs associated with the current reserve sharing group, if applicable. WAPA-UGP's annual revenue requirement will be recovered under the SPP Tariff. This rate design recovers only WAPA-UGP's revenue requirement associated with Reserve Services. The Reserve Services will apply to both load and generation in the WAUW (i.e., transmission service for loads in the WAUW and transmission service for generation deliveries out of the WAUW).

WAPA-UGP will true-up the cost estimates with WAPA-UGP's actual costs. Revenue collected in excess of WAPA-UGP's actual net revenue requirement will be returned through a credit in a subsequent year. Actual revenues that are less than the net revenue requirement would likewise be recovered in a subsequent year. The true-up procedure will ensure that WAPA-UGP will recover no more and no less than the actual costs for the year.

Spinning Reserves

Operating Reserve-Spinning Reserve Service (Spinning Reserves) is needed to serve load immediately in the event of a system contingency. Spinning Reserves may be provided by generating units that are on-line and loaded at less than maximum output. Given the SPP Integrated Marketplace does not extend into the Western Interconnection, WAPA-UGP, as the BA, will offer to provide Spinning Reserves, if available, at the request of SPP as the Transmission Provider in the WAUW. Spinning Reserves in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Spinning Reserves obligation. WAPA-UGP's annual revenue requirement for Spinning Reserves will be utilized by SPP to calculate the WAUW charges for Spinning Reserves.

If resources are not available from a WAPA-UGP resource, WAPA-UGP, at the request of SPP as the Transmission Provider, will offer to purchase the Spinning Reserves and pass through the costs, plus an amount for administration, to SPP for the SPP Transmission Customer.

In the event that Spinning Reserves are called upon for emergency use, the SPP Transmission Customer will be assessed a charge for energy used at the prevailing market energy rate in the WAUW. The prevailing market energy rate will be based upon a representative hourly energy index or combination of indexes. The index to be used, or any change to the index, will be posted on the applicable SPP website and WAPA-UGP's OASIS at least 30 days before use for determining the prevailing market energy rate and will not be changed more often than once per year unless WAPA-UGP determines that the existing index is no longer a reliable price index. The SPP Transmission Customer would be responsible for providing transmission service to get the Spinning Reserves to its destination.

Supplemental Reserves

Operating Reserve-Supplemental Reserve Service (Supplemental Reserves) is needed to serve load in the event of a system contingency; however, it is not available immediately to serve load but rather within a short period of time.

Supplemental Reserves may be provided by generating units that are on-line but unloaded, by quick-start generation, or by interruptible load. Given the SPP Integrated Marketplace does not extend into the Western Interconnection, WAPA-UGP, as the BA, will offer to provide Supplemental Reserves, if available, at the request of SPP as the Transmission Provider, in the WAUW. Operating Reserve-Supplemental Reserve Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Supplemental Reserves obligation. WAPA-UGP's annual revenue requirement for Supplemental Reserves will be utilized by SPP to calculate the WAUW charges for Supplemental Reserves.

Comments

WAPA received one oral comment and one comment letter during the public consultation and comment period. The comments have been paraphrased, where appropriate, without compromising the meaning of the comments.

Comment: The customer notes its appreciation of the efforts WAPA is making to increase transparency of the formula rate template, and that its comments are generally centered on transparency. As such, the customer requests WAPA adjust the formula rate template to ensure transparency for all stakeholders. Specifically, this includes financial and source document data transparency and transparency on the website.

Response: WAPA has reviewed the Formula Rate Templates and all suggestions provided by the customer regarding transparency. WAPA has updated the Formula Rate Templates to address the customer's comments. These template changes include additional footnotes, links, references, and other suggestions provided by the customer. WAPA has included the additional financial and source document data on OASIS at: http://www.oasis.oati.com/​wapa/​index.html.

Certification of Rates

WAPA's Administrator certified that the Provisional Formula Rates for P-SMB—ED under Rate Schedules WAUGP-ATRR, WAUGP-AS1, WAUW-AS3, WAUW-AS4, WAUW-AS5, WAUW-AS6, and WAUW-AS7 are the lowest possible rates, consistent with sound business principles. The Provisional Formula Rates were developed following administrative policies and applicable laws.

Availability of Information

Information about this rate adjustment, including the customer Rate Brochure, comments, letters, memorandums, and other supporting materials that were used to develop the Provisional Formula Rates, is available for inspection and copying at the Upper Great Plains Regional Office, located at 2900 4th Avenue North, Billings, Montana. Many of these documents are also available online at the following locations: (1) WAPA-UGP's OASIS at: http://www.oasis.oati.com/​wapa/​index.html;​; (2) WAPA-UGP's Rates web page at: https://www.wapa.gov/​regions/​UGP/​rates/​Pages/​rates.aspx;​; and (3) the “Western Area Power Administration UGP Information” link on SPP's Member Related Postings website at: http://opsportal.spp.org/​OASIS/​Directory/​Member%20Related%20Postings.

RATEMAKING PROCEDURE REQUIREMENTS

Environmental Compliance

WAPA has determined that this action is categorically excluded from the preparation of an environmental assessment or an environmental impact statement.^[5] A copy of the categorical exclusion determination is available on WAPA's website at: https://www.wapa.gov/​regions/​UGP/​Environment/​Pages/​environment.aspx.

Determination Under Executive Order 12866

WAPA 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 Formula Rates herein confirmed, approved, and placed into effect on an interim basis, together with supporting documents, will be submitted to FERC for confirmation and final approval.

ORDER

In view of the above and under the authority delegated to me, I hereby confirm, approve, and place into effect, on an interim basis, Rate Order No. WAPA-188. The rates will remain in effect on an interim basis until: (1) FERC confirms and approves them on a final basis; (2) subsequent rates are confirmed and approved; or (3) such rates are superseded.

Dated: July 9, 2020.

Bruce J. Walker,

Assistant Secretary for Electricity.

Rate Schedule WAUGP-ATRR

October 1, 2020

(Supersedes Rate Schedule WAUGP-ATRR dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

ANNUAL TRANSMISSION REVENUE REQUIREMENT FOR TRANSMISSION SERVICE

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register.

Applicable

Western Area Power Administration-Upper Great Plains Region's (Western-UGP) formula based Annual Transmission Revenue Requirement (ATRR) for its eligible transmission related facilities included under the Southwest Power Pool, Inc. (SPP) Tariff will be calculated using the formula outlined below.

Formula Rate

Define:

A = Operation & Maintenance allocated to transmission ($)

B = Depreciation allocated to transmission ($)

C = Interest Expense allocated to transmission ($)

D = Revenue Credits ($)

E = Scheduling, System Control, and Dispatch costs ($)

F = Prior Period True-up ($)

ATRR = A + B + C−D−E + F

Note:

Western-UGP will identify any portion(s) of the ATRR eligible for recovery under SPP Schedule 11 pursuant to the SPP Tariff in its Rate Formula Template submitted under Attachment H of the SPP Tariff.

A recalculated annual revenue requirement will go into effect every January 1 based on the above formula and updated financial data. Western-UGP will annually notify SPP and make data and information available to interested parties for review and comment related to the recalculated annual revenue requirement on or shortly after September 1 of the preceding year. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS).

Rate Schedule WAUGP-AS1

October 1, 2020

(Supersedes Rate Schedule WAUGP-AS1 dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

SCHEDULING, SYSTEM CONTROL, AND DISPATCH SERVICE

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register.

Applicable

Scheduling, System Control, and Dispatch Service (SSCD) is required to schedule the movement of power through, out of, within, or into the Southwest Power Pool, Inc. (SPP) Balancing Authority Area and/or the Western Area Power Administration, Upper Great Plains West Balancing Authority Area (WAUW). Western Area Power Administration-Upper Great Plains Region's (Western-UGP) annual revenue requirement for SSCD will be used by SPP to calculate the regional SPP Schedule 1 rate for SPP through and out transactions, and also to calculate the zonal SPP Schedule 1 rate for the Upper Missouri Zone (UMZ or Zone 19). This rate will also be charged by SPP for SPP Transmission Service provided within the UMZ in the Western Interconnection.

Formula Rate

Define:

A = Operation & Maintenance for SSCD ($)

B = Administrative and General Expense for SSCD ($)

C = Depreciation for SSCD ($)

D = Taxes Other than Income Taxes for Transmission ($)

E = Allocation of General Plant for SSCD ($)

F = Cost of Capital for SSCD ($)

G = SSCD Revenue from non-Transmission facilities ($)

H = Prior Period True-up ($)

SSCD Annual Revenue Requirement = A + B + C + D + E + F−G + H

A recalculated annual revenue requirement will go into effect every January 1 based on the above formula and updated financial data. Western-UGP will annually notify SPP and make data and information available to interested parties for review and comment related to the recalculated annual revenue requirement on or shortly after September 1 of the preceding year. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS).

Rate Schedule WAUW-AS3

October 1, 2020

(Supersedes Rate Schedule WAUW-AS3 dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

REGULATION AND FREQUENCY RESPONSE SERVICE—WAUW

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register.

Applicable

This Rate Schedule applies to the Western Area Power Administration, Upper Great Plains West Balancing Authority Area (WAUW). Regulation and Frequency Response Service (Regulation) is necessary to provide for the continuous balancing of resources, generation, and interchange with load and for maintaining scheduled interconnection frequency at 60 cycles per second (60 Hz). Regulation is accomplished by committing on-line generation whose output is raised or lowered, predominantly through the use of automatic generating control equipment, as necessary, to follow the moment-by-moment changes in load. The obligation to maintain this balance between resources and load lies with the Western Area Power Administration-Upper Great Plains Region (Western-UGP) as the WAUW operator. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Regulation obligation. Western-UGP's annual revenue requirement for Regulation (outlined below) will be used by SPP to calculate the WAUW charges for Regulation.

Western-UGP supports the installation of renewable sources of energy but recognizes that certain operational constraints exist in managing the significant fluctuations that are a normal part of their operation. When Western-UGP purchases power resources to provide Regulation to intermittent resources serving load within Western-UGP's WAUW, costs for these regulation resources will become part of Western's Regulation revenue requirement, which will be billed by SPP, as the Transmission Provider, to a SPP Transmission Customer along with the associated transmission service provided by SPP under the SPP Tariff. However, Western-UGP will not regulate for the difference between the output of an intermittent resource located within Western-UGP's WAUW and a delivery schedule from that generator serving load located outside of Western-UGP's WAUW. Intermittent resources serving load outside Western-UGP's WAUW will be required to be pseudo-tied or dynamically scheduled to another Balancing Authority Area.

An intermittent resource, for the limited purpose of this Rate Schedule, is an electric generator that is not dispatchable and cannot store its fuel source and, therefore, cannot respond to changes in demand or respond to transmission security constraints.

Formula Rate

Define:

A = U.S. Army Corps of Engineers (Corps) Fixed Charge Rate (%)

B = Corps Generation Net Plant Costs ($)

C = Plant Capacity (kW)

D = Capacity Used for Regulation (kW-year)

E = Capacity Purchases for Regulation ($)

F = Prior Period True-up

Regulation Annual Revenue Requirement = (A * B / C) * D + E + F

A recalculated revenue requirement will go into effect every January 1 based on the above formula and updated financial data. Western-UGP will annually notify SPP and make data and information available to interested parties for review and comment related to the recalculated annual revenue requirement on or shortly after September 1 of the preceding year. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS).

Rate Schedule WAUW-AS4

October 1, 2020

(Supersedes Rate Schedule WAUW-AS4 dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

ENERGY IMBALANCE SERVICE—WAUW

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register .

Applicable

This Rate Schedule applies to the Western Area Power Administration, Upper Great Plains West Balancing Authority Area (WAUW). Energy Imbalance Service is provided when a difference occurs between scheduled and actual delivery of energy to a load located within Western Area Power Administration-Upper Great Plains Region's (Western-UGP) WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable). Given the Southwest Power Pool, Inc. (SPP) Integrated Marketplace does not extend into the Western Interconnection, Western-UGP, as the Balancing Authority, will offer to provide Energy Imbalance Service in the WAUW at the request of SPP, if it is capable of doing so, from its own resources or from resources available to it including possible participation in a Western Interconnection energy imbalance service market. SPP is the Transmission Provider for the eligible Western-UGP facilities transferred to the functional control of SPP in the WAUW. Energy Imbalance Service is needed when transmission service is provided by SPP and used to serve load within the WAUW, or when a difference occurs between the expected and actual delivery of energy to/from the WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable) in the event that Western-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the Balancing Authority. Energy Imbalance Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP, or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Energy Imbalance Service obligation.

The SPP Transmission Customer will incur a charge for either hourly energy imbalances under this Schedule, WAUW-AS4, or hourly generator imbalances under Rate Schedule WAUW-AS7 for imbalances occurring during the same hour, but not both, unless the imbalances aggravate rather than offset each other.

Formula Rate

(A) In the event that Western-UGP does not participate in a Western Interconnection energy imbalance service market in the WAUW as the Balancing Authority, or such energy imbalance market is unable to provide the total energy imbalance requirements for certain loads and generation within the Balancing Authority Area:

For deviations within +/−1.5 percent (with a minimum of 2 MW) of the scheduled transaction to be applied hourly to any energy imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be netted on a monthly basis and settled financially, at the end of the month, at 100 percent of the average incremental cost.

Deviations greater than +/−1.5 percent up to 7.5 percent (or greater than 2 MW up to 10 MW) of the scheduled transaction to be applied hourly to any energy imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled financially, at the end of each month. When energy taken in a schedule hour is greater than the energy scheduled, the charge is 110 percent of incremental cost. When energy taken is less than the scheduled amount, the credit is 90 percent of the incremental cost.

Deviations greater than +/−7.5 percent (or 10 MW) of the scheduled transaction to be applied hourly to any energy imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled at 125 percent of Western-UGP's incremental cost when energy taken in a schedule hour is greater than the energy scheduled or 75 percent of Western- UGP's incremental cost when energy taken by a SPP Transmission Customer is less than the scheduled amount.

Western-UGP's incremental cost will be based upon a representative hourly energy index or combination of indexes. The index to be used will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS) at least 30 days before use for determining the Western-UGP incremental cost and will not be changed more often than once per year unless Western-UGP determines that the existing index is no longer a reliable price index.

The pricing and charge for deviations in the above deviation bandwidths is as specified above. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's OASIS.

(B) In the event that Western-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the Balancing Authority:

Charges to the SPP Transmission Customer will reflect only the pass-through of the applicable charges associated with the Western Interconnection energy imbalance service market assessed to Western-UGP as the WAUW Balancing Authority for embedded load and/or generation in the WAUW of such SPP Transmission Customer that does not make adequate alternate arrangements in such Western Interconnection energy imbalance service market or other alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Energy Imbalance Service obligation.

Western-UGP will post notice on the applicable SPP website and Western-UGP's OASIS, and also notify existing SPP Transmission Customers, at least 30 days before Western-UGP participates in a Western Interconnection energy imbalance service market, as the Balancing Authority. Western-UGP will also post information related to the charges assessed by the market operator for Energy Imbalance Service in the WAUW under such Western Interconnection energy imbalance service market.

Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's OASIS.

Rate Schedule WAUW-AS5

October 1, 2020

(Supersedes Rate Schedule WAUW-AS5 dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

OPERATING RESERVE—SPINNING RESERVE SERVICE—WAUW

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register.

Applicable

This Rate Schedule applies to the Western Area Power Administration, Upper Great Plains West Balancing Authority Area (WAUW). Operating Reserve-Spinning Reserve Service (Spinning Reserves) is needed to serve load immediately in the event of a system contingency. Spinning Reserves may be provided by generating units that are on-line and loaded at less than maximum output. Given the Southwest Power Pool, Inc. (SPP) Integrated Marketplace does not extend into the Western Interconnection, Western Area Power Administration-Upper Great Plains Region (Western-UGP), as the Balancing Authority, will offer to provide Spinning Reserves, if available, at the request of SPP as the Transmission Provider in the WAUW. Operating Reserve-Spinning Reserve Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Spinning Reserves obligation. Western-UGP's annual revenue requirement for Spinning Reserves (outlined below) will be utilized by SPP to calculate the WAUW charges for Spinning Reserves.

Formula Rate

Define:

A = U.S. Army Corps of Engineers (Corps) Fixed Charge Rate (%)

B = Corps Generation Net Plant Costs ($)

C = Plant Capacity (kW)

D = Maximum Load in the WAUW (kW)

E = Maximum Generation in the WAUW (kW)

F = Reserve Sharing Program Requirement based upon Load (%)—See Note 1

G = Reserve Sharing Program Requirement based upon Generation (%)—See Note 2

H = Prior Period True-up

I = Annual cost associated with Western-UGP's current reserve sharing group membership

Note 1:

Currently 3% in the Northwest Power Pool (NWPP) Reserve Sharing Program.

Note 2:

Currently 3% in the NWPP Reserve Sharing Program.

Spinning Reserves Annual Revenue Requirement = (A * B/C) * ((D * F) + (E * G)) + H + I

A recalculated revenue requirement will go into effect every January 1 based on the above formula and updated financial, load/generation, and Reserve Sharing Program requirements data. Western-UGP will annually notify SPP and make data and information available to interested parties for review and comment related to the recalculated annual revenue requirement on or shortly after September 1 of the preceding year. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS).

If resources are not available from a Western-UGP resource, Western-UGP, at the request of SPP as the Transmission Provider, will offer to purchase the Spinning Reserves and pass through the costs, plus an amount for administration, to SPP for the SPP Transmission Customer.

In the event that Spinning Reserves are called upon for emergency use, the SPP Transmission Customer will be assessed a charge for energy used at the prevailing market energy rate in the WAUW. The prevailing market energy rate will be based upon a representative hourly energy index or combination of indexes. The index to be used will be posted on the applicable SPP website and Western UGP's OASIS at least 30 days before use for determining the prevailing market energy rate and will not be changed more often than once per year unless Western-UGP determines that the existing index is no longer a reliable price index. The SPP Transmission Customer would be responsible for providing transmission service to get the Spinning Reserves to its destination.

Rate Schedule WAUW-AS6

October 1, 2020

(Supersedes Rate Schedule WAUW-AS6 dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

OPERATING RESERVE—SUPPLEMENTAL RESERVE SERVICE—WAUW

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register.

Applicable

This Rate Schedule applies to the Western Area Power Administration, Upper Great Plains West Balancing Authority Area (WAUW). Operating Reserve-Supplemental Reserve Service (Supplemental Reserves) is needed to serve load in the event of a system contingency; however, it is not available immediately to serve load but rather within a short period of time.

Supplemental Reserves may be provided by generating units that are on-line but unloaded, by quick-start generation, or by interruptible load. Given the Southwest Power Pool, Inc. (SPP) Integrated Marketplace does not extend into the Western Interconnection, Western Area Power Administration-Upper Great Plains Region (Western-UGP), as the Balancing Authority, will offer to provide Supplemental Reserves, if available, at the request of SPP as the Transmission Provider, in the WAUW. Operating Reserve-Supplemental Reserve Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Supplemental Reserves obligation. Western-UGP's annual revenue requirement for Supplemental Reserves (outlined below) will be utilized by SPP to calculate the WAUW charges for Supplemental Reserves.

Formula Rate

Define:

A = U.S. Army Corps of Engineers (Corps) Fixed Charge Rate (%)

B = Corps Generation Net Plant Costs ($)

C = Plant Capacity (kW)

D = Maximum Load in the WAUW (kW)

E = Maximum Generation in the WAUW (kW)

F = Reserve Sharing Program Requirement based upon Load (%)—See Note 1

G = Reserve Sharing Program Requirement based upon Generation (%)—See Note 2

H = Prior Period True-up

I = Annual cost associated with Western-UGP's current reserve sharing group membership

Note 1:

Currently 3% in the Northwest Power Pool (NWPP) Reserve Sharing Program.

Note 2:

Currently 3% in the NWPP Reserve Sharing Program.

Supplemental Reserves Annual Revenue Requirement = (A * B/C) * ((D * F) + (E * G)) + H + I

A recalculated revenue requirement will go into effect every January 1 based on the above formula and updated financial, load/generation, and Reserve Sharing Program requirements data. Western-UGP will annually notify SPP and make data and information available to interested parties for review and comment related to the recalculated annual revenue requirement on or shortly after September 1 of the preceding year. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS).

If resources are not available from a Western-UGP resource, Western-UGP, at the request of SPP as the Transmission Provider, will offer to purchase the Supplemental Reserves and pass through the costs, plus an amount for administration, to SPP for the SPP Transmission Customer.

In the event Supplemental Reserves are called upon for emergency use, the SPP Transmission Customer will be assessed a charge for energy used at the prevailing market energy rate in the WAUW. The prevailing market energy rate will be based upon a representative hourly energy index or combination of indexes. The index to be used will be posted on the applicable SPP website and Western-UGP's OASIS at least 30 days before use for determining the prevailing market energy rate and will not be changed more often than once per year unless Western-UGP determines that the existing index is no longer a reliable price index. The SPP Transmission Customer would be responsible for providing transmission service to get the Supplemental Reserves to its destination.

Rate Schedule WAUW-AS7

October 1, 2020

(Supersedes Rate Schedule WAUW-AS7 dated October 1, 2015, through September 30, 2020)

UNITED STATES DEPARTMENT OF ENERGY WESTERN AREA POWER ADMINISTRATION

UPPER GREAT PLAINS REGION PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION

GENERATOR IMBALANCE SERVICE—WAUW

Effective

Beginning on October 1, 2020, and remaining in effect through September 30, 2025, or until superseded by another rate schedule, whichever occurs earlier. Notification of the effective date of the formula rates will be published in the Federal Register.

Applicable

This Rate Schedule applies to the Western Area Power Administration, Upper Great Plains West Balancing Authority Area (WAUW). Generator Imbalance Service is provided when a difference occurs between the output of a generator located within Western Area Power Administration-Upper Great Plains Region's (Western-UGP) WAUW and a delivery schedule from that generator to (1) another Balancing Authority Area or (2) a load within Western-UGP's WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable). Given the Southwest Power Pool, Inc. (SPP) Integrated Marketplace does not extend into the Western Interconnection, Western-UGP, as the Balancing Authority, will offer to provide this service at the request of SPP, if it is capable of doing so, from its own resources or from resources available to it including possible participation in a Western Interconnection energy imbalance service market. SPP is the Transmission Provider for the eligible Western-UGP facilities transferred to the functional control of SPP in the WAUW. Generator Imbalance Service is needed when transmission service is provided by SPP and used to deliver energy from a generator located within the WAUW, or when a difference occurs between the expected and actual delivery of energy to/from the WAUW over a single hour (or different dispatch interval for energy imbalance service market, if applicable) in the event that Western-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the Balancing Authority. Generator Imbalance Service in the WAUW will be billed by SPP to the SPP Transmission Customer along with the associated transmission service provided by SPP. The SPP Transmission Customer must either purchase this service from SPP or make alternative comparable arrangements pursuant to the SPP Tariff, to satisfy its Generator Imbalance Service obligation. The SPP Transmission Customer will incur a charge for either hourly generator imbalances under this Schedule, WAUW-AS7, or hourly energy imbalances under Rate Schedule WAUW-AS4 for imbalances occurring during the same hour, but not both, unless the imbalances aggravate rather than offset each other.

Western-UGP supports the installation of renewable sources of energy but recognizes that certain operational constraints exist in managing the significant fluctuations that are a normal part of their operation. Western-UGP has marketed the maximum practical amount of power from each of its projects, leaving little or no flexibility for provision of additional power services. Consequently, Western-UGP will not regulate for the difference between the output of an intermittent resource located within the WAUW and a delivery schedule from that generator serving load located outside of the WAUW. Intermittent resources serving load outside Western-UGP's WAUW will be required to be pseudo-tied or dynamically scheduled to another Balancing Authority Area.

An intermittent resource, for the limited purpose of this Rate Schedule, is an electric generator that is not dispatchable and cannot store its fuel source and, therefore, cannot respond to changes in demand or respond to transmission security constraints.

Formula Rate

(A) In the event that Western-UGP does not participate in a Western Interconnection energy imbalance service market in the WAUW as the Balancing Authority, or such energy imbalance market is unable to provide the total energy imbalance requirements for certain loads and generation within the Balancing Authority Area:

For deviations within +/−1.5 percent (with a minimum of 2 MW) of the scheduled transaction to be applied hourly to any generator imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be netted on a monthly basis and settled financially, at the end of the month, at 100 percent of the average incremental cost.

Deviations greater than +/−1.5 percent up to 7.5 percent (or greater than 2 MW up to 10 MW) of the scheduled transaction to be applied hourly to any generator imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled financially, at the end of each month. When energy delivered in a schedule hour from the generation resource is less than the energy scheduled, the charge is 110 percent of incremental cost. When energy delivered from the generation resource is greater than the scheduled amount, the credit is 90 percent of the incremental cost.

Deviations greater than +/−7.5 percent (or 10 MW) of the scheduled transaction to be applied hourly to any generator imbalance that occurs as a result of the SPP Transmission Customer's scheduled transaction(s) will be settled at 125 percent of Western-UGP's highest incremental cost for the day when energy delivered in a schedule hour is less than the energy scheduled or 75 percent of Western-UGP's lowest daily incremental cost when energy delivered from the generation resource is greater than the scheduled amount. As an exception, an intermittent resource will be exempt from this deviation band and will pay the deviation band charges for all deviations greater than the larger of 1.5 percent or 2 MW.

Deviations from scheduled transactions responding to directives by the Transmission Provider, a Balancing Authority, or a reliability coordinator will not be subject to the deviation bands identified above and, instead, will be settled financially, at the end of the month, at 100 percent of incremental cost. Such directives may include instructions to correct frequency decay, respond to a reserve sharing event, or change output to relieve congestion.

Western-UGP's incremental cost will be based upon a representative hourly energy index or combination of indexes. The index to be used will be posted on the applicable SPP website and Western-UGP's Open Access Same-Time Information System (OASIS) at least 30 days before use for determining the Western-UGP incremental cost and will not be changed more often than once per year unless Western-UGP determines that the existing index is no longer a reliable price index.

The pricing and charge for deviations in the deviation bandwidths is as specified above. Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's OASIS.

(B) In the event that Western-UGP participates in a Western Interconnection energy imbalance service market in the WAUW as the Balancing Authority:

Charges to the SPP Transmission Customer will reflect only the pass-through of the applicable charges associated with the Western Interconnection energy imbalance service market assessed to Western-UGP as the WAUW Balancing Authority for embedded load and/or generation in the WAUW of such SPP Transmission Customer that does not make adequate alternate arrangements in such Western Interconnection energy imbalance service market or other alternative comparable arrangements pursuant to the SPP Tariff to satisfy its Generator Imbalance Service obligation.

Western-UGP will post notice on the applicable SPP website and Western-UGP's OASIS, and also notify existing Transmission Customers, at least 30 days before Western-UGP participates in a Western Interconnection energy imbalance service market, as the Balancing Authority. Western-UGP will also post information related to the charges assessed by the market operator for Generator Imbalance Service in the WAUW under such Western Interconnection energy imbalance service market.

Data used and the charges resulting from using this formula will be posted on the applicable SPP website and Western-UGP's OASIS.

Footnotes

1.  Order Confirming and Approving Rate Schedules on a Final Basis, FERC Docket No. EF15-8-000, 153 FERC ¶ 61213 (2015). FERC also accepted the inclusion of UGP's revenue requirements for transmission and ancillary services under the SPP Open Access Transmission Tariff, FERC Docket No. ER15-2354-000, 152 FERC ¶ 61257 (2015).

2.  50 FR 37835 (September 18, 1985) and 84 FR 5347 (February 21, 2019).

3.  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 (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 projects involved.

4.  50 FR 37835 (September 18, 1985) and 84 FR 5347 (February 21, 2019).

5.  The determination was done in compliance with the National Environmental Policy Act (NEPA) of 1969, as amended, 42 U.S.C. 4321-4347; the Council on Environmental Quality Regulations for implementing NEPA (40 CFR parts 1500-1508); and DOE NEPA Implementing Procedures and Guidelines (10 CFR part 1021).