Integrated System Power Rates

DEPARTMENT OF ENERGY

Southwestern Power Administration

Integrated System Power Rates

AGENCY: Southwestern Power Administration, DOE.

ACTION: Notice of extension.

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SUMMARY: The Deputy Secretary of Energy, acting under Amendment No. 3

to Delegation Order No. 0204-108, dated November 10, 1993, 58 FR 59717,

and pursuant to the implementation authorities in 10 CFR 903.22(h) and

903.23(a)(3), has approved Rate Order No. SWPA-34 which extends the

existing power rates for the Integrated System. This is an interim rate

action effective October 1, 1996, extending for a period of one year

through September 30, 1997.

FOR FURTHER INFORMATION CONTACT: George C. Grisaffe, Assistant

Administrator, Office of Administration and Rates, Southwestern Power

Administration, Department of Energy, P.O. Box 1619, Tulsa, Oklahoma

74101, (918) 595-6628.

SUPPLEMENTARY INFORMATION: The existing rate schedules for the

Integrated System were approved on a final basis by the Federal Energy

Regulatory Commission on September 18, 1991, for the period ending

September 30, 1994. These rates were extended on an interim basis by

the Deputy Secretary of Energy on August 24, 1994, and on August 8,

1995. The rates are scheduled to expire on September 30, 1996. On July

2, 1996, the Southwestern Power Administration (Southwestern) published

notice in the Federal Register, 61 FR 34432, of its intention to seek a

one-year extension of the existing power rates for the Integrated

System and provided for a 15-day comment period. No comments were

received. 10 CFR 903.22(h) and 903.23(a)(3) provide implementation

authority for such interim extension to the Deputy Secretary.

Issued at Washington, DC, this 23rd day of September, 1996.

Charles B. Curtis,

Deputy Secretary.

Department of Energy

Deputy Secretary of Energy

In the matter of: Southwestern Power Administration--Integrated

System Rates

[Rate Order No. SWPA-34]

Order Approving Extension of Power Rates on an Interim Basis

September 23, 1996.

Pursuant to Sections 302(a) and 301(b) 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 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 into effect on an interim basis power and transmission rates,

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 rather than the Deputy 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 revised Delegation Order No. 0204-108 to delegate

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. This rate order is issued by

the Deputy Secretary pursuant to said Amendment to Delegation Order No.

0204-108.

This is an interim rate extension. It is made pursuant to the

authorities as implemented in 10 CFR 903.22(h) and 903.23(a)(3).

Background

Southwestern Power Administration (Southwestern) currently has

marketing responsibility for 2.2 million kilowatts of power from 24

multiple-purpose reservoir projects, generally in all or portions of

the states of Arkansas, Kansas, Louisiana, Missouri, Oklahoma and

Texas, with power facilities constructed and operated by the U.S. Army

Corps of Engineers. The Integrated System, comprised of 22 of the

projects, is interconnected through a transmission system presently

consisting of 138- and 161-kV high-voltage transmission lines, 69-kV

transmission lines, and numerous bulk power substations and switching

stations. In addition, contractual transmission arrangements provide

for integration of other projects into the system.

The remaining two projects, Sam Rayburn Dam and Robert Douglas

Willis, are isolated hydraulically and electrically from the

Southwestern transmission system, and their power is marketed under

separate contracts

[[Page 51103]]

through which the customer purchases the entire power output of the

project at the dam. A separate Power Repayment Study (PRS) is prepared

for each isolated project, and each has a special rate which is not a

part of this study.

The existing rate schedules for the Integrated System were

confirmed and approved on a final basis by the FERC on September 18,

1991, for the period October 1, 1990, through September 30, 1994. These

rates were extended on an interim basis by the Deputy Secretary of

Energy on August 28, 1994, and again on August 8, 1995. The rates are

scheduled to expire September 30, 1996. The FY 1996 Integrated System

PRSs indicate the need for a rate adjustment of $1,239,868 annually, or

1.3 percent.

Pursuant to implementing authority in 10 CFR 903.22(h) and

903.23(a)(3), the Deputy Secretary of Energy may extend a FERC-approved

rate on an interim basis. The Administrator, Southwestern, published

notice in the Federal Register on July 2, 1996, 61 FR 34432, announcing

a 15-day period for public review and comment concerning the proposed

interim rate extension. In addition, meetings that discussed the

proposal were held with customer representatives in April and July

1996. Written comments were accepted through July 17, 1996. No comments

on the proposed interim extension were received.

Discussion

The existing Integrated System rates are based on the FY 1990 PRS.

PRSs have been completed on the Integrated System each year since

approval of the existing rates. Rate changes identified by the PRSs

since that period have indicated the need for minimal rate increases or

decreases. Since the revenue changes reflected by the PRSs were within

the plus-or-minus two percent Rate Adjustment Threshold established by

Southwestern's Administrator on June 23, 1987, these rate adjustments

were deferred in the best interest of the government and provided for

the next year's PRS to determine the appropriate level of revenues

needed for the next rate period.

The FY 1996 PRS indicates the need for an annual revenue increase

of 1.3 percent. As has been the case since the existing rates were

approved, the FY 1996 rate adjustment needed falls within

Southwestern's plus-or-minus two percent Rate Adjustment Threshold and

would normally be deferred. However, the existing rates expire on

September 30, 1996. Consequently, Southwestern proposes to extend the

existing rates for a one-year period ending September 30, 1997, on an

interim basis under the implementation authorities noted in 10 CFR

903.22(h) and 903.23(a)(3).

Southwestern continues to make significant progress toward

repayment of the Federal investment in the Integrated System. Through

FY 1995, status of repayment for the Integrated System was

$355,572,353, which represents approximately 36 percent of the

$982,272,106 Federal investment for the Integrated System. The status

has increased almost 82 percent since the existing rates were placed in

effect.

Information regarding this rate extension, 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 74101.

Order

In view of the foregoing and pursuant to the authority delegated to

me by the Secretary of Energy, I hereby extend on an interim basis, for

the period of one year, effective October 1, 1996, the current FERC-

approved Southwestern Power Administration Integrated System Rates.

Issued at Washington, DC, the 23rd day of September 1996.

Charles B. Curtis,

Deputy Secretary.

[FR Doc. 96-24984 Filed 9-27-96; 8:45 am]

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