01-22699. Sam Rayburn Dam Power Rate Schedules

AGENCY:

Southwestern Power Administration, DOE.

ACTION:

Notice of rate decrease.

SUMMARY:

Pursuant to Delegation Order No. 0204-172, November 24, 1999, the Deputy Secretary of Energy has approved and placed into effect on an interim basis Rate Order No. SWPA-47 which decreases the power rate for the Sam Rayburn Dam Hydropower Project (Rayburn) pursuant to the following Sam Rayburn Dam Rate Schedule:

Rate Schedule SRD-01, Wholesale Rates for Hydro Power and EnergySold to Sam Rayburn Dam Electric Cooperative, Inc., (Contract No. DE-PM75-92SW00215)

FOR FURTHER INFORMATION CONTACT:

Mr. Forrest E. Reeves, Assistant Administrator, Office of Corporate Operations, Southwestern Power Administration, Department of Energy, One West Third Street, Tulsa, OK 74103-3519, [phone], [e-mail].

SUPPLEMENTARY INFORMATION:

The existing hydroelectric power rate for the Rayburn project is $2,168,136 per year. The rate was approved on a final basis by the Federal Energy Regulatory Commission on December 7, 1994, for the period ending September 30, 1998. The rate was extended for three years, in one-year intervals, with the most recent effective October 1, 2000, through September 30, 2001, in accordance with the Secretary of Energy's interim approval, dated September 15, 2000, 65 FR 55953. The FY 2001 Rayburn Power Repayment Studies indicate the need for a decrease in the annual rate of $90,504, or 4.2 percent beginning October 1, 2001.

The Administrator, Southwestern Power Administration (Southwestern) has followed Title 10, Part 903 Subpart A, of the Code of Federal Regulations, “Procedures for Public Participation in Power and Transmission Rate Adjustments and Extensions” (Part 903) in connection with the proposed rate schedule. On May 11, 2001, Southwestern published notice in the Federal Register, 66 FR 24132, of a 90-day comment period, together with a Public Information Forum and a Public Comment Forum, to provide an opportunity for customers and other interested members of the public to review and comment on a proposed rate decrease for the Rayburn project. Both public forums were canceled when no one expressed an intention to participate. Written comments were accepted through August 9, 2001. Only one comment was received from Gillis & Angley, Counsellors at Law, on behalf of Sam Rayburn Dam Electric Cooperative, Inc. (SRDEC), which stated that SRDEC (the sole customer) had no objection to the proposed rate adjustment.

Information regarding this rate proposal, including studies and other supporting material, is available for public review and comment in the offices of Southwestern Power Administration, Suite 1400, One West Third Street, Tulsa, Oklahoma 74103.

Following review of Southwestern's proposal within the Department of Energy, I approved Rate Order No. SWPA-47, which decreases the existing Rayburn rate to $2,077,632 per year for the period October 1, 2001, through September 30, 2005.

Dated: August 29, 2001.

Francis S. Blake,

Deputy Secretary.

Order Confirming, Approving and Placing Decreased Power Rate Schedule in Effect on an Interim Basis

Pursuant to sections 301(b) and 302(a) of the Department of Energy Organization Act, Public Law 95-91, the functions of the Secretary of the Interior and the Federal Power Commission under section 5 of the Flood Control Act of 1944, 16 U.S.C. 825s, for the Southwestern Power Administration (Southwestern) were transferred to and vested in the Secretary of Energy. By Delegation Order No. 0204-108, effective December 14, 1983, 48 FR 55664, the Secretary of Energy delegated to the Deputy Secretary of Energy on a non-exclusive basis the authority to confirm, approve and place power and transmission rates into effect on an interim basis, and delegated to the Federal Energy Regulatory Commission (FERC) on an exclusive basis the authority to confirm, approve and place in effect on a final basis, or to disapprove power and transmission rates. Amendment No. 1 to Delegation Order No. 0204-108, effective May 30, 1986, 51 FR 19744, revised the delegation of authority to confirm, approve and place into effect on an interim basis power and transmission rates by delegating such authority to the Under Secretary of Energy. This delegation was reassigned to the Deputy Secretary of Energy by Department of Energy (DOE) Notice 1110.29, dated October 27, 1988, and clarified by Secretary of Energy Notice SEN-10-89, dated August 3, 1989, and subsequent revisions. By Amendment No. 2 to Delegation Order No. 0204-108, effective August 23, 1991, 56 FR 41835, the Secretary of the Department of Energy delegated to the Assistant Secretary, Conservation and Renewable Energy, the authority which was previously delegated to the Deputy Secretary in that Delegation Order. By Amendment No. 3 to Delegation Order No. 0204-108, effective November 10, 1993, the Secretary of Energy re-delegated to the Deputy Secretary of Energy, the authority to confirm, approve and place into effect on an interim basis power and transmission rates of the Power Marketing Administrations. By notice, dated April 15, 1999, the Secretary of Energy rescinded the authority of the Deputy Secretary of Energy under Delegation Order No. 0204-108. By Delegation Order No. 0204-172, effective November 24, 1999, the Secretary of Energy again provided interim rate approval authority to the Deputy Secretary of Energy.

Background

The Sam Rayburn Hydropower Project (Rayburn) is located on the Angelina River in the State of Texas in the Neches River Basin. Since the beginning of its operation in 1965, it has been marketed as an isolated project, under contract with Sam Rayburn Dam Electric Cooperative, Inc. (Contract No. DE-PM75-92SW00215).

In the Federal Energy Regulatory Commission (FERC) Docket No. EF94-4021-000, issued December 7, 1994, for the period October 1, 1994, through September 30, 1998, the FERC confirmed and approved the current annual Sam Rayburn Dam rate of $2,168,135. This rate was subsequently extended for three years, in one year intervals on an interim basis by the Deputy Secretary of Energy or Secretary of Energy under the Rate Order and for the periods listed below:

Rate Order SWPA-38, October 1, 1998—September 30, 1999

Rate Order SWPA-40, October 1, 1999—September 30, 2000

Rate Order SWPA-42, October 1, 2000—September 30, 2001

Discussion

Southwestern's FY 2001 Current Power Repayment Study (PRS) indicates that the existing annual power rate of $2,168,135 did not represent the lowest possible rate needed to meet cost recovery criteria. The reduced revenue requirement is due to a decrease in the Corps of Engineers (Corps) future replacement estimates. The Revised PRS indicates that a decrease in annual revenues of $90,504 beginning in FY 2002 is sufficient to accomplish repayment of the Federal investment in the required number of years. Accordingly, Southwestern developed a proposed rate schedule based on that decreased revenue requirement.

Title 10, Part 903, Subpart A of the Code of Federal Regulations, “Procedures for Public Participation in Power and Transmission Rate Adjustment,” has been followed in connection with the proposed rate adjustment. More specifically, opportunities for public review and comment during a 90-day period on the proposed Rayburn power rate were announced by notice published in the Federal Register, May 11, 2001, 66 FR 24132. A Public Information Forum was to be held June 14, 2001, in Tulsa, Oklahoma, and a Public Comment Forum was to be held July 18, 2001, also in Tulsa. Both forums were canceled as no one expressed an intention to participate. Written comments were due by August 9, 2001. Southwestern provided notice of the Federal Register, together with supporting data, to the customer and interested parties for review and comment during the formal period of public participation. In addition, prior to the formal 90-day public participation process, Southwestern met with the customer and their representative to discuss with them preliminary information on the proposed rate adjustment. Only one formal comment was received from Gillis & Angley, Counsellors at Law, on behalf of Sam Rayburn Dam Electric Cooperative, Inc. (SRDEC), which stated that SRDEC (the sole customer) had no objection to the proposed rate adjustment.

Upon conclusion of the comment period in August 2001, Southwestern finalized the Power Repayment Study and rate schedule for the proposed annual rate of $2,077,632 which is the lowest possible rate needed to satisfy repayment criteria. This rate represents an annual decrease of 4.2 percent.

Information regarding this rate decrease, including studies and other supporting material, is available for public review and comment in the offices of Southwestern Power Administration, One West Third Street, Tulsa, Oklahoma 74103-3519.

Comments and Responses

Southwestern received one written comment in which the customer representative expressed no objection to the proposed rate adjustment.

Other Issues

There were no other issues raised during the informal meeting or during the formal public participation period.

Administrator's Certification

The FY 2001 Revised Rayburn PRS indicates that the annual power rate of $2,077,632 will repay all costs of the project, including amortization of the power investment consistent with provisions of the Department of Energy (DOE) Order No. RA 6120.2. In accordance with Delegation Order No. 0204-172, November 24, 1999, and Section 5 of the Flood Control Act of 1944, the Administrator has determined that the proposed Rayburn power rate is consistent with applicable law and the lowest possible rate consistent with sound business principles.

Environment

The environmental impact of the rate decrease proposal was evaluated in consideration of DOE's guidelines for implementing the procedural provisions of the National Environmental Policy Act, 10 CFR 1021, and was determined to fall within the class of actions that are categorically excluded from the requirements of preparing either an Environmental Impact Statement or an Environmental Assessment.

Order

In view of the foregoing and pursuant to the authority delegated to me by the Secretary of Energy, I hereby confirm, approve and place in effect on an interim basis, for the period October 1, 2001, through September 30, 2005, the annual Sam Rayburn Dam Rate of $2, 077,632 for the sale of power and energy from Sam Rayburn Dam to the Sam Rayburn Electric Cooperative, Inc., under Contract No. DE-PM75-92SW00215, dated October 7, 1992.

Dated: August 29, 2001.

Francis S. Blake,

Deputy Secretary.