Central Valley ProjectProposed Commercial Firm Power Rates

DEPARTMENT OF ENERGY

Western Area Power Administration

Central Valley Project--Proposed Commercial Firm Power Rates

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of Proposed Central Valley Project Commercial Firm Power

Rate Adjustment.

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SUMMARY: The Western Area Power Administration (Western) is proposing a

rate adjustment for commercial firm power service (Proposed Rates) for

the Central Valley Project (CVP), for the remaining period under the

current Schedule for Rates for Commercial Firm-Power Service (Rate

Schedule CV-F7). The power repayment study (PRS) and other analysis

indicate that Western's commercial firm power rates need to be revised.

At this time, only the commercial firm power rates are being adjusted.

Other rate schedules approved as part of Western's Rate Order No. 59,

and all other provisions under Rate Schedule CV-F7 will remain

unchanged. A rate adjustment addressing all provisions of Rate Schedule

CV-F7 will occur prior to its expiration on April 30, 1998.

The Proposed Rates will continue to provide sufficient revenue to

pay all annual costs (including interest expense), plus repayment of

required investment within the allowable time period. The rate impacts

are detailed in a rate brochure to be distributed to all interested

parties. The Proposed Rates are scheduled to go into effect on October

1, 1995.

The Proposed Rates consist of base energy rates up to a 70-percent

load factor, tier energy rates at or above a 70-percent load factor,

and capacity rates.

The Proposed Rates are designed to recover 40-percent of the

revenue requirement from the capacity rate and 60-percent from the

energy rate.

A comparison of the current rates under Rate Schedule CV-F7, and

the Proposed Rates for the same time period, show rate adjustments

beginning on October 1, 1995; October 1, 1996; and October 1, 1997. The

Proposed Rates and applicable revenue requirement split are provided in

Table 1 below.

Table 1.--Proposed Commercial Firm Power Rates

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Total

Effective period composite Capacity ($/kW- Base energy Tier energy Capacity/

(mills/kWh) mo) (mills/kWh) (mills/kWh) energy split

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10/01/95 to 09/30/96............ 24.00 4.89 13.35 26.05 40/60

10/01/96 to 09/30/97............ 26.60 5.41 15.01 26.16 40/60

10/01/97 to 04/30/98............ 27.00 5.50 15.26 26.26 40/60

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The Tier Rate will be applied to commercial firm energy at 70-

percent load factor and above, with the load factor based on the lesser

of the customer's (1) maximum demand for the month or, if a scheduling

customer, maximum scheduled demand for the month; or (2) contract rate

of delivery for commercial firm power.

The Assistant Secretary for Conservation and Renewable Energy of

the Department of Energy (DOE), approved the existing rate schedules on

an interim basis on April 12, 1993 (Rate Order No. WAPA-59, 58 FR 35933

(July 2, 1993), and the Federal Energy Regulatory Commission (FERC)

confirmed and approved the rate schedule on a final basis on September

22, 1993, under FERC Docket No. EF93-5011-000, (64 FERC Part 61,332).

The existing rate schedule was effective on May 1, 1993, for the period

ending April 30, 1998. Under the current CVP Rate Schedule CV-F7, the

composite rate on October 1, 1995, will be 31.55 mills per kilowatt-

hour (mills/kWh), the base energy rate will be 17.73 mills/kWh, the

tier energy rate will be 34.70 mills/kWh, and the capacity rate will be

$6.57 per kilowatt-month (kW-mo). Table 2 provides a comparison of the

rates in the current CVP Rate Schedule CV-F7 and the Proposed Rates

along with the percentage change in the rates:

[[Page 35557]]

Table 2.--Comparison of Current and Proposed Rates

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Percentage change in commercial firm power rates

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Total

Effective period composite Percent Capacity ($/kW- Percent Base energy Percent Tier energy Percent

(mills/kWh) change mo) change (mills/kWh) change (mills/kWh) change

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Current rate schedule:

10/01/95 to 09/30/97.................... 31.55 ......... 6.57 ......... 17.73 ......... 34.70

10/01/97 to 04/30/98.................... 34.37 ......... 7.16 ......... 19.33 ......... 37.46

Proposed rates:

10/01/95 to 09/30/96.................... 24.00 -24 4.89 -26 13.35 -25 26.05 -25

10/01/96 to 09/30/97.................... 26.60 -16 5.41 -18 15.01 -15 26.16 -25

10/01/97 to 04/30/98.................... 27.00 -21 5.50 -23 15.26 -21 26.26 -30

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Other Rate Provisions Associated With the Proposed CVP Power Rates

Power Factor Adjustment Clause

This provision contained in CVP Rate Schedule CV-F7, will remain

the same under the Proposed Rates.

Low Voltage Loss Adjustment

This provision contained in CVP Rate Schedule CV-F7, will remain

the same under the Proposed Rates.

Revenue Adjustment Clause

The methodology for the Revenue Adjustment Clause (RAC) is being

amended in a concurrent process.

DATES: The consultation and comment period will begin July 7, 1995, and

will end not less than 30 days later, or August 11, 1995. Under the

existing rate schedule, a rate increase will occur October 1, 1995. In

an effort to avoid large rate fluctuations, and the resultant impact on

customers, the Proposed Rate must be put in place on or before October

1, 1995. To meet this deadline, the comment period has been shortened

to 30 days in accordance with the regulations on Rate Adjustments found

at 10 CFR 903.14.

The proposed rates reflect roughly a 16% to 24% decrease from the

commercial firm power rates in CVP Rate Schedule CV-F7. The recent

change in the level of customers' purchases from Western, and the

determination of the resulting rate impacts prevented Western from

initiating this rate adjustment at an earlier date. Because of the

limited scope of this rate adjustment, Western feels a 30 day comment

period is appropriate and allows sufficient opportunity for input into

the rate adjustment. A public information forum will be held on July

26, 1995, beginning at 10 a.m. at the Red Lion Hotel, 2001 Point West

Way, Sacramento, California, 95815. A public comment forum at which

Western will receive oral and written comments will also be held on

July 26, 1995, beginning at 1 p.m., at the same location. To be

considered, written comments should be received by Western by close of

business on August 11, 1995. This is the end of the consultation and

comment period. Comments should be sent to the address below: James C.

Feider, Area Manager, Sacramento Area Office, Western Area Power

Administration, 1825 Bell Street, Suite 105, Sacramento, CA 95825-1097,

(916) 649-4418.

FOR FURTHER INFORMATION CONTACT: Debbie Dietz, Director, Division of

Rates, Studies, and Power Billing, Sacramento Area Office, Western Area

Power Administration, 1825 Bell Street, Suite 105, Sacramento, CA

95825-1097, (916) 649-4453.

SUPPLEMENTARY INFORMATION: Power and transmission rates for the CVP are

established pursuant to the Department of Energy Organization Act (42

U.S.C. 7101 et seq.) and the Reclamation Act of 1902 (43 U.S.C. 371 et

seq.), as amended and supplemented by subsequent enactments,

particularly section 9(c) of the Reclamation Project Act of 1939 (43

U.S.C. 485h(c)) and Acts of Congress approved August 26, 1937 (50 Stat.

844, 850); August 12, 1955 (69 Stat. 719); and October 23, 1962 (76

Stat. 1173, 1191), and Acts amendatory or supplementary thereof.

By Amendment No. 3 to Delegation Order No. 0204-108, published

November 10, 1993 (58 FR 59716), the Secretary of DOE delegated (1) The

authority to develop long-term power and transmission rates on a

nonexclusive basis to the Administrator of Western; (2) the authority

to confirm, approve, and place such rates into effect on an interim

basis to the Deputy Secretary; and (3) the authority to confirm,

approve, and place into effect on a final basis, to remand, or to

disapprove such rates to the FERC. Existing DOE procedures for public

participation in power rate adjustments (10 CFR part 903) became

effective on September 18, 1985 (50 FR 37835).

Availability of Information

All brochures, studies, comments, letters, memoranda, or other

documents made or kept by Western for the purpose of developing the

Proposed Rates for commercial firm power, are and will be made

available for inspection and copying at the Sacramento Area Office,

located at 1825 Bell Street, Suite 105, Sacramento, California 95825.

Determination Under Executive Order 12866

DOE has determined that this is not a significant regulatory action

because it does not meet the criteria of Executive Order 12866, 58 FR

51735. Western has an exemption from centralized regulatory review

under Executive Order 12866; accordingly, no clearance of this notice

by Office of Management and Budget is required.

Environmental Evaluation

In compliance with the National Environmental Policy Act of 1969

(42 U.S.C. 4321 et seq.); Council on Environmental Quality Regulations

(40 CFR parts 1500 through 1508); and DOE NEPA Regulations (10 CFR part

1021), Western conducts environmental evaluations of the CVP commercial

firm power rate adjustment and develops the appropriate level of

environmental documentation prior to the implementation of any rate

adjustment.

Issued at Golden, Colorado, June 22, 1995.

J.M. Shafer,

Administrator.

[FR Doc. 95-16820 Filed 7-7-95; 8:45 am]

BILLING CODE 6450-01-P