NETWORK INTEGRATION TRANSMISSION AND

ANCILLARY SERVICES

 

 

RATE ADJUSTMENT BROCHURE

 

DESERT SOUTHWEST

CUSTOMER SERVICE REGION


TABLE OF CONTENTS

Appendix List 2

I.  Introduction. 3

II. Proposed Transmission Rates for DSWR Projects. 6

Background. 6

Proposed Charge For Network Service. 6

Annual Transmission Revenue Requirement 6

Charge For Network Service on Separate Projects. 7

Charge For Network Service on the Whole System.. 7

Proposed Load for Transmission Service. 7

III. Proposed Rates for Ancillary Services. 9

Background. 9

Description of Proposed Rate Methodologies. 9

Scheduling, System Control, and Dispatch Service. 10

Reactive Supply and Voltage Control Service. 12

Regulation and Frequency Response Service. 13

Non-Standard Regulation Service. 15

Energy Imbalance Service. 16

Operating Reserves - Spinning Reserve Service. 18

Operating Reserves - Supplemental Reserve Service. 19

IV. Rate Adjustment Procedure. 21

Public Process. 21

Revision of the Proposed Rates. 23

Decision on Proposed or Revised Proposed Rates. 23

Final Decision on the Rate Adjustment 23

V. Environmental Requirements. 24

Environmental Evaluation. 24


Appendix List

A.     Definitions

B.     Timeline of Activities

C.    DSWR Project Descriptions

D.    Marketing Map

E.     CRSP CSC Rate Summary

F.     Ancillary Services Rates History

G.    Consolidated Rate Schedules for PDP, BCP, Intertie and CAP

H.     PDP Cost Apportionment Study

I.         PDP Power Repayment Summary

J.      BCP Power Repayment Summary

K.     Intertie Power Repayment Summary

L.      Desert Southwest Contract Rate of Delivery (CROD)

M.    DSWR Network Integration Transmission Service Rate Design

N.     Scheduling, System Control, and Dispatch Ancillary Service

O.    Scheduling, System Control, and Dispatch Rate Design

P.     Reactive Supply and Voltage Control Ancillary Service

Q.    Reactive Supply and Voltage Control Ancillary Service Rate Design

R.     Regulation and Frequency Response Ancillary Service

S.     Regulation Ancillary Service Rate Design  

T.      Energy Imbalance Ancillary Service

U.     Court Reporter

V.     DOE Order RA 6120.2 - Power Marketing Administration Financial Reporting

W.   Federal Register Notice - Draft Copy


I.  Introduction

 

Western Area Power Administration’s (Western) Desert Southwest Region (DSWR) is proposing revised rates (proposed rates) for the long-term sale of ancillary services for the Parker-Davis Project (PDP), Boulder Canyon Project (BCP), Pacific Northwest-Pacific Southwest Intertie Project (Intertie), the Colorado River Storage Project (CRSP) and the Central Arizona Project (CAP) and network integration transmission service (network service) for the PDP and Intertie.  This action is necessary because existing rates expire on March 31, 2006.  The proposed rates will be applied under Western’s Open Access Transmission Tariff (OATT) and certain pre-OATT firm transmission contracts.

 

DSWR will offer network service to eligible transmission customers, subject to provisions in its OATT.  The customer must obtain ancillary services for network service pursuant to Western's OATT except that the scheduling, system control, and dispatch (Scheduling) ancillary service costs are included in the network service charge.  Network service will be provided from the P-DP, CAP, Intertie and the DSWR power system (whole system) within the Western Area Lower Colorado (WALC) Balancing Authority and Transmission Operation (BATO).  The CAP network service is offered under Rate Order No. WAPA-124.  The network service charge for P-DP, CAP, and Intertie Projects will apply to transactions within the respective Project. 

 

Rate Order No. WAPA-84, which was set to expire on March 31, 2004, was extended to accommodate the DSWR Multi-System Transmission Rate (MSTR) process.  A MSTR has not been approved.  However, the whole system network service charge is structured to allow multi-system network service on the DSWR System if and when a MSTR is approved.

 

DSWR will price the six ancillary services defined by FERC.  The six ancillary services are: 1) Scheduling, System Control, and Dispatch (Scheduling) Service; 2) Reactive Supply and Voltage Control (Voltage Support) Service; 3) Regulation and Frequency Response (Regulation) Service; 4) Energy Imbalance Service; 5) Spinning Reserve Service; and 6) Supplemental Reserve Service.

 

The network and ancillary services rate schedules define formula rates.  Each year after Rate Order No. WAPA-127 becomes effective, Western will recalculate the rates based on the most current data.  The recalculated ancillary service rates will be effective on October 1, of each year, as will the revenue requirement for each Project.

 

Definitions of some of the terms used in this brochure can be found in Appendix A.  A timeline of activities related to the Rate Order No. WAPA-127 Public Process is contained in Appendix B.  A description of the Projects under the WALC BATO is in Appendix C and the Marketing Map for the DSWR is in Appendix D.

 

CRSP completed a public rate process for ancillary Services rates effective October 1, 2002.  A summary of these rates and their applicable rate schedules is provided in Appendix E.  Those ancillary services which refer to Rocky Mountain Region (RMR) or the Western Area Colorado Missouri (WACM) Control Area have been determined in a separate public rate process by RMR.  Those services that refer to DSWR or the WALC BATO are included in this rate process.

 

Under Rate Order No. WAPA-84, the ancillary service rates were recalculated each year.  The historical ancillary Service rates for DSWR can be found in Appendix F.  The current rates for the ancillary services as well as the transmission and generation rates for each of the Projects in DSWR are on the DSW Web site and shown in Appendix G, Consolidated Rate Schedules for PDP, BCP, Intertie and CAP.

 

In PDP, revenues and expenses that make up the revenue requirement recovered through the sales of ancillary, transmission, and generation services are divided between generation and transmission in a work book called the Cost Apportionment Study (CAS).  Appendix H contains a summary of the CAS.  Revenue requirements for each of the Projects in DSWR are determined in Power Repayment Studies (PRS).  Summaries of the PRS for PDP, BCP and Intertie are in Appendices I, J, and K, respectively. 

 

The formula rates defined in Rate Order No. WAPA-127 use transmission sales reservations or the Contract Rate of Delivery (CROD) as one of the determinants.  A list of the transmission reservations by customer for the Intertie, PDP, and CAP are in Appendix L.

 

Return to Table of Contents


II. Proposed Transmission Rates for DSWR Projects

Background

DSWR will offer network service to all eligible transmission customers under the proposed rates.  The proposed rates will be applicable to existing and future transmission service.  These rates include the cost of Scheduling ancillary service.  The firm and non-firm transmission services and the CAP network service are offered under separate rate orders.  Network service on the whole DSWR system is defined in this rate process to apply to the DSWR Multi-Project Transmission Rate (MSTR) if and when a MSTR is approved. 

 

The methodology used for rate development, billing purposes, and the implementation process are described below with additional information at Appendix M.  

Proposed Charge For Network Service

The charge for network service is the product of the transmission customer's load-ratio share time’s one-twelfth of the annual transmission revenue requirement (ATRR).  The customer's load-ratio share is equal to the network transmission customer's hourly load coincident with the monthly transmission system peak (12CP) divided by the monthly transmission system load at the hour of the system peak.  The hour of monthly system peak is determined as the hour that the sum of the network service customers’ metered load is the greatest.

Annual Transmission Revenue Requirement

The annual Power Repayment Study (PRS) will be used to derive the annual transmission revenue requirement to be recovered from network service for the PDP and the Intertie.  The ATRR for the CAP are derived with a methodology described in the latest rate adjustment process the CAP, which is available on DSWR’s website at http://www.wapa.gov/dsw/pwrmkt/CAPTRP/CAPTRP.htm.  The annual transmission costs include operation and maintenance expense, purchase power and wheeling expense, administrative and general expense, and principal and interest payments.  The projected ATRR allocated to transmission for Fiscal Year (FY) 2006 for the P-DP is $32,826,345, for the Intertie Project is $29,808,939, and for CAP is $3,681,344.  The ATRR for whole system service is equal to the sum of the ATRRs of the three projects or $66,316,628.

Charge For Network Service on Separate Projects

Network service will be provided separately from the CAP, the P-DP and the Intertie Projects.  The charge for network service is the transmission customer's load-ratio share multiplied by one-twelfth of the applicable Project ATRR.  The customer's load-ratio share is equal to that customer’s 12CP divided by the system peak for the service Project. 

Charge For Network Service on the Whole System

The charge for whole system network service is the transmission customer's load-ratio share times one-twelfth of the annual transmission revenue requirement of the combined DSWR Projects, where the load ratio share is equal to that customer’s 12CP divided by the system peak of the DSWR system.  The whole system network service does not include the CRSP Project.

Proposed Load for Transmission Service

The system load may vary from month to month both on a Project basis and a whole system basis.  This variability arises from two sources:  1) changes in contract reservations and 2) differences in meter readings of the network service customers.  Changes in contract reservations may happen because a new customer signs a contract, an existing customer terminates a contract or an existing customer modifies the reservation quantities.  Customers are given the option to change the quantities in their exhibits once a year providing Western determines there is adequate available transmission.

System Load for Separate Projects

The system load at the peak hour is the sum of the firm point-to-point reservations contracted on a given system plus the sum of the network service customer’s meters on that system during the hour of the month that the network service load is greatest.  The PDP system reservations include the Firm Electric Service (FES) CROD, the pre-OATT Firm Transmission Service reservations, the CRSP[s1]  FES delivered to points of delivery on the PDP and the firm point-to-point reservations under Western’s OATT.  The Intertie system reservations include the pre-OATT Firm Transmission Service reservations and the firm point-to-point reservations under Western’s OATT.  The CAP system reservations include the pre-OATT Firm Transmission Service reservations (which includes Central Arizona Water Conservation District transmission reservations), and the firm point-to-point reservations under Western’s OATT.

System Load for the Whole System

The System Load at the peak hour is the sum of the firm point-to-point transmission reservations for PDP, Intertie and CAP plus the sum of the network service customers’ meters at the hour of the month that the meter sum is greatest.  Table 1 shows the estimated load for the point–to-point reservations for each Project and for the whole system load as of July, 2005.

 

Table 1

Transmission Reservations

PDP

FES

256 MW

 

FTS

1325 MW

 

OATT

1017 MW

 

CRSP

75 MW

Intertie

FTS

777 MW

 

OATT

946 MW

CAP

FTS

519 MW

 

OATT

310 MW

Whole System

 

5225. MW

Return to Table of Contents


III. Proposed Rates for Ancillary Services

Background

Ancillary services are necessary to provide basic transmission service, and to correct the effects associated with undertaking a transmission transaction within a BATO.  To this end, DSWR will provide ancillary services, subject to provisions in its OATT.  The proposed rates for these services are designed to recover all the costs incurred for the service(s).  

 

The proposed rates for these ancillary services are designed to recover the costs incurred for providing each of the ancillary services.  The annual generation costs included in the development of the revenue requirement consists of operation and maintenance expenses, administrative and general expenses, and interest and principal capital payments.  The annual PRS is the primary tool utilized to derive the revenue requirement to be recovered from the ancillary services.  Additional tools include meter and Supervisory Control and Data Acquisition (SCADA) data, and power flow studies.

 

Currently, DSWR is offering the following ancillary services:  Scheduling , System Control, and Dispatch Service, Voltage Support; Energy Imbalance Service; Spinning Reserve Service, and Supplemental Reserve Service.  The current rates will expire March 31, 2006.

Description of Proposed Rate Methodologies

The Scheduling , System Control, and Dispatch Service and the Voltage Support are defined by FERC as services that a transmission provider/control area operator must provide and the transmission customer must purchase from the BATO.

 

The other four FERC-defined ancillary services, Regulation Service; Energy Imbalance Service; Spinning Reserve Service and Supplemental Reserve Service, must be offered by a transmission provider that operates a BATO.  The transmission customer has the following options in regard to these services:  1) take the services from the transmission provider/control area operator, 2) self-supply the services for their transaction, or 3) purchase the services from a third-party acceptable to Western.

 

Because of the April 1, 1998, consolidation of all the CRSP generation units into the WALC BATO, two of the ancillary services: (1) Voltage Support Service and, (2) Regulation Service, will include certain CRSP generation costs as well as DSWR project generation costs.

 

The following paragraphs give short descriptions of the six ancillary services and the rate design for each of the proposed rates.  Calculations and additional descriptive information can be found in Appendices N through T.

Scheduling, System Control, and Dispatch Service

Scheduling, System Control and Dispatch ancillary service is required to schedule the movement of power through, out of, within, or into a BATO.  This ancillary service is required to be offered to the transmission customer from the transmission provider/control area.  This ancillary service can be provided only by the BATO operator in which the transmission facilities used are located.  That is, the transmission customer must purchase this service from the transmission provider or the BATO operator.

 

Scheduling costs are calculated as an annual cost of all personnel, capital costs (such as the control center building), and other related costs involved in providing the service for DSWR customers.  These costs are recovered through a rate applied on a per tag basis.  The rate is determined in two major steps.  First, the yearly costs associated with capital improvements are determined and divided by the number of tags issued during the previous year.  Second, the average labor cost per tag is determined and added to the capital cost per tag.

 

This proposed rate methodology differs from the previous methodology in two ways:  1) the proposed rates are based on tags rather than schedules and 2) the proposed methodology does not differentiate between new and existing service or whether or not the tag involves an intra-bus transfer.  Table 2 shows a comparison between the existing and proposed rates using data that is current as of July 2005.  Appendix O shows the backup data and calculations used to derive the proposed rates.

 

Table 2: Scheduling, System Control & Dispatch Ancillary Service

Existing

Proposed

Description

Rates

Description

Rates

DSW-SD1 --

per Schedule per Day

DSW-SD2

per Tag

Existing No SCADA programming or Intra-bus Transfer

$54.99

All applicable transactions

$18.55

Existing No SCADA programming requires Intra-bus Transfer

$73.05

 

 

New Schedule w/SCADA no Inter-bus Transfer

$51.10

 

 

New Schedule w/SCADA and Intra-bus Transfer

$75.26

 

 

 

Reactive Supply and Voltage Control Service

In order to maintain transmission voltages on the transmission provider's transmission facilities within acceptable limits, generation facilities controlled by the BATO operator are operated to produce or absorb reactive power.  Thus, Voltage Support Service must be provided for each transaction on the transmission provider's transmission facilities.  The amount of Voltage Support Service that must be supplied with respect to the transmission customer's transaction is determined by the reactive power support necessary to maintain transmission voltages within limits that are generally accepted in the region and consistently adhered to by the transmission provider.  This ancillary service is required to be offered to the transmission customer from the transmission provider in order to maintain transmission voltages on the transmission provider's transmission facilities within acceptable limits.

 

The proposed rate for Voltage Support service is calculated by determining the revenue requirement for the service and dividing by the capacity reservations requiring the service.  The revenue requirement for the service is obtained by multiplying the generation revenue requirement by one minus the power factor of the plants supplying the service and totaling the values for the BATO.  The capacity requiring the service includes the capacity reservations in DSWR less the Independent Power Producers (IPP) plus the capacity from the CRSP units.  The IPP capacity reservations for transmission service from the IPP plants are not included because their control area service agreements include a provision that require them to supply Voltage Support to the BATO for this service. 

 

The proposed rate methodology differs from the current methodology in several ways.  The current methodology: 1)applied a formula (1-PF2) to determine the percentage of generation revenue requirement applied to the reactive service for PDP and BCP, but depended on the CRSP to supply the calculation for their revenue requirement and 2) considered all transmission reservations in BATO and expressed monthly rate to 2 decimal places.  Under the proposed rate Methodology DSWR will apply a formula (1-PF) to determine the percent of total generation that reactive service represents for all 3 projects (PDP, BCP, and CRSP).  For PDP, the PF is based PDP operational flow restrictions rather than on name plate of the units.  In addition, the transmission capacity excludes the IPPs because their control area service agreements require that they supply Voltage Support Service to the BATO.

 

Table 3 shows a comparison between the existing and proposed rates for the Voltage Support Service using current determinants for the Proposed Methodology.

 

Table 3: Reactive Supply and Voltage Support

Existing

Proposed

Description

Rates

Description

Rates

DSW-RS1

$/kW-mo

DSW-RS2

$/kW-mo

All applicable transactions

$0.05

All applicable transactions

$0.043

 

Appendix Q shows the backup data and calculations used to derive the Voltage Support Service rate.  Revenue from this service will be allocated to each project based on an estimate of which customers use the service.

Regulation and Frequency Response Service

Regulation Service is necessary to provide for the continuous balancing of resources, generation and interchange, with load and for maintaining scheduled interconnection frequency at sixty cycles per second (60 Hz).  To accomplish this, Regulation provides for the raising or lowering of on-line generation units that are equipped with automatic-generation control (AGC) and that can change output quickly (MW/second) to track moment-to-moment fluctuations in load.  The transmission provider must offer this service when the transmission service is used to serve load within its BATO.  The transmission customer must either purchase this service from the transmission provider or make alternative comparable arrangements satisfactory to Western to provide its Regulation Service obligation.  The specific service agreement between Western and the transmission customer must reflect these alternative arrangements, if applicable.

 

Regulation Service is not available from DSWR resources on a long-term basis.  However, if necessary, DSWR will purchase regulation on the open market on a pass through cost basis plus a charge that covers the cost of procuring and supplying the service.  Regulation will be supplied from DSWR resources only on a short-term basis and only if such resources are available. 

 

To calculate a rate for Regulation Service supplied by DSWR resources, the proposed rate methodology takes the revenue requirement for the service divided by the BATO load requiring the service.  The revenue requirement for the service is the product of the generation capacity that is set aside for the regulation times the capacity rate of supplying Projects plus any regulation purchases the transmission provider must make.  This total is multiplied by a use factor, which takes into consideration the customer load in the WALC BATO.  The denominator in the equation (the load in the BATO requiring the service) is the sum of the CRSP load in the WALC BATO, and the  DSWR load. 

 

The proposed rate methodology is similar to the current rate in that DSWR does not have long term Regulation Service to sell.  The proposed rate methodology differs from the current rate, in that, the proposed revenue requirement is determined by the portion of generation used for the Regulation Service.  The rate was based on the capacity rate of the project supplying the service

 

Table 4 shows a comparison between the existing and proposed rates using data that is current as of July 2005 for the proposed rate.  Appendix S shows the backup data and calculations used to derive this rate.

 

Table 4: Regulation & Frequency Response Service

Existing

Proposed

Description

Rates

Description

Rates

DSW-FR1

mills/kW-hr

DSW-FR2

mills/kW-hr

If available, equal to capacity charge of Supplying Project  

If available for short term sales

0.2049

 

Non-Standard Regulation Service

Generally, on an industry wide basis, the amount of generation capacity that needs to be dedicated for regulation is approximately 1% – 3% of the peak load (or approximately 3% – 6% of the average load) requiring regulation.  Because regulation is supplied to the system in the aggregate, rather than to individual loads, increases or decreases in the individual customer loads increase or decrease the amount of generation capacity needed for regulation. 

 

By inference, large volatile loads (such as those associated with loads such as smelters and arc furnaces) can require a BATO to acquire significant amounts of generation capacity for regulation.  Such non-standard loads require separate metering of their moment-to-moment load values in order to accurately calculate their effects on the system.  Therefore, the regulation service rate described in the previous paragraphs does not apply to these non-standard loads.

 

For this rate order, DSWR defines a non-standard load as either a single plant or site with a regulation capacity requirement of: 5 MW or greater on a recurring basis and the capacity requirement is equal to 10% or greater of their average load.  Regulation for non-standard loads, as determined by Western, must be provided for in a separate service agreement, which recognizes and compensates the additional burden required to supply this service.

 

Energy Imbalance Service

Energy Imbalance Service is provided when a difference occurs between the scheduled and the actual delivery of energy to a load located within a BATO over a single hour.  An energy imbalance account will be maintained for each customer scheduling energy in the WALC BATO.  The customer must either schedule return energy to make up deviations within a certain time period; or pay the cost of the imbalance energy that is provided by the transmission provider and/control area, as determined by Western.  

 

The transmission provider must offer this service when transmission service is used to serve load within its BATO.  The transmission customer must either purchase this service from the transmission provider or make alternative comparable arrangements satisfactory to Western to provide its Energy Imbalance Service obligation.  The specific service agreement between Western and the transmission customer must reflect these arrangements.

 

Generally customers with no generation would have difficulty making their load exactly match their schedule.  For this reason FERC’s proforma tariff recommends an energy bandwidth.  Because of the relationship between the amount of water behind the dam and DSWR’s ability to supply the service, the proposed rate sets forth a different bandwidth for on-peak and for off-peak.  The band width for on-peak is proposed to be plus or minus 1.5% of the customer’s load with a minimum of 5 MW either over or under delivery.  The off-peak bandwidth is 1.5% to a negative 3% of a customer’s load with a minimum of 2 MW over delivery and 5 MW under delivery.

 

The settlement with the customer will be different for excursions within the bandwidth than for excursions outside the bandwidth.  However, in all cases, it is at Western’s discretion whether to require a scheduled return of energy or a financial settlement.  If the customer’s Imbalance Energy is within the bandwidth for both on-peak and off-peak, the customer will either be charged or credited, as applicable, 100% of a weighted index price chosen by Western, or a scheduled return of an equal amount of energy. 

 

For energy outside the bandwidth during the on-peak hours, the methodology will require 110% of the weighted index price for under deliveries and 90% of the weighted index price for over deliveries.  For energy outside the bandwidth during the off-peak hours, the methodology will also require 110% of the weighted index price for under deliveries.  However, for over deliveries in the off-peak hours, the methodology will require the lesser of 60% of the weighted index price or a WALC weighted sales price, as determined by Western.  In lieu of a financial settlement for energy outside the bandwidth during off-peak hours, an amount of energy equivalent to the financial settlement will be scheduled.

 

The proposed rate methodology differs from the previous methodology in that under WAPA-84 DSWR used the FERC pro-forma methodology to define the service.  For example, a 3 percent band width with a 2 MW deviation was used, under-deliveries were assessed a 100 mills/kWh penalty, and over-deliveries were credited at 50 % of market value.  Under the proposed rate methodology, a percentage of the market value of energy is assessed for both over-deliveries and under-deliveries, and incursions during on-peak hours are treated differently than those during off-peak hours.

 

Appendix T shows the parameters of the Energy Imbalance Service with additional information and Table 5 shows the determinants for this service.

 

 

 

 

 

 

 

Table 5: Energy Imbalance

Description

Existing

Proposed

 

 

 

On/Off Peak

 

Bandwidth

+/-1.5%

On

+/-1.5%

Minimum

3 MW

 

5 MW

Bandwidth

 

Off

+1.5 to -3%

Minimum

 

 

2 MW (Over Delivery)

5 MW (Under Delivery)

Energy

No Penalty

On

100% of Weighted

Within

(Return 100%

 

Index Price

Bandwidth

of Energy

Off

100% of Weighted

 

 

 

Index Price (Under Delivery)

Energy

100 mills/kWhr

On

110% of Weighted

Outside

+ return of

 

Index Price (Under Delivery)

Bandwidth

Energy

 

90% of Weighted

 

 

 

Index Price (Over Delivery)

 

 

Off

110% of Weighted

 

 

 

Index Price (Under Delivery)

 

 

 

The Lesser of 60% of Weighted Index Price

 

 

 

or WALC Weighted Sales Price

(Over Delivery)

 

Operating Reserves - Spinning Reserve Service

Spinning Reserve Service is 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.  The transmission provider must offer this service when the transmission service is used to serve load within its BATO.  The transmission customer must either acquire this ancillary service from Western or make alternative comparable arrangements satisfactory to Western to provide its Spinning Reserve Service obligation.  The specific service agreement between Western and the transmission customer must reflect these arrangements.

 

Spinning Reserve Service will not be available from DSWR resources on a long-term basis.  If a customer cannot self-supply or purchase this service from another provider, Western may obtain the reserves at market price plus a charge that covers the cost of procuring and supplying the service.  The transmission customer will be responsible for the transmission service to get these reserves to the designated point of delivery.

 

The Spinning Reserve Service under the proposed rate Methodology does not differ from the previous rate methodology, except for the charge associated with procuring and supplying the service.

 

Operating Reserves - Supplemental Reserve Service

The Supplemental Reserve Service is needed to serve load in the event of a system contingency.  However, it does not need to be available immediately to serve load but rather within a short period of time.  The Supplemental Reserve Service may be provided by generating units that are online and unloaded, by quick-start generation or by interruptible load.  The transmission provider must offer this service when the transmission service is used to serve load within its BATO.  The transmission customer must either acquire this ancillary service either from Western or make alternative comparable arrangements satisfactory to Western to provide its Supplemental Reserve Service obligation.

 

Supplemental reserves will not be available from DSWR resources on a long-term basis.  If a customer cannot self-supply or purchase this service from another provider, Western may obtain the reserves at market price plus a charge that covers the cost of procuring and supplying the service.  The transmission customer will be responsible for the transmission service to get these reserves to the designated point of delivery.

 

The supplemental reserve service under the proposed rate Methodology does not differ from the previous rate methodology, except for the charge associated with procuring and supplying the service.

 

Return to Table of Contents

 


IV. Rate Adjustment Procedure

Public Process

Western's rate adjustment procedures are governed by the "Procedures for Public Participation in Power and Transmission Rate Adjustments and Extensions" (10 CFR Part 903).  These procedures give interested parties an opportunity to participate in the development of power rates.

 

The formal public consultation and comment period begins with the publication of the Federal Register Notice (Appendix W) and ends 90 days thereafter.  During this time, interested parties may consult with and obtain information from DSWR representatives about the rate proposals.  Both a public information and public comment forum will be held during the consultation and comment period.

 

The Public Information Forum will be held:

November 2, 2005

Western Area Power Administration

Desert Southwest Customer Service Region

615 South 43rd Avenue

Phoenix. AZ 85009

 

During the Public Information Forum, DSWR representatives will explain the need for the proposed rate adjustment and answer questions.  Questions not answered at the Public Information Forum will be answered in writing at least 15 days before the end of the consultation and comment period.  The Public information Forum will be recorded and transcribed.  Copies of the transcript will be available for purchase from the Court Reporter shown at Appendix U.

 

The Public Comment Forum will be held:

November 29, 2005

Western Area Power Administration

Desert Southwest Customer Service Region

615 South 43rd Avenue

Phoenix, AZ 85009

At the Public Comment Forum, interested persons may submit written or oral comments.  As with the Public Information Forum, the Public Comment Forum will be recorded and transcribed.  Copies of the transcript will be available for purchase from the Court Reporter shown at Appendix U.

 

Written Comments

All interested parties may submit written comments to DSWR any time during the consultation and comment period.  All comments must be received by DSWR by the end of the comment period to ensure their consideration.  Written comments should be sent to:

Mr. J. Tyler Carlson

Regional Manager

Western Area Power Administration

Desert Southwest Customer Service Region

P.O. Box 6457

Phoenix, AZ 85005-6457

or faxed to the Regional Manager at (602) 605-2630.

 

For further information, please contact:

Mr. Jack Murray

Rates Team Lead, G6100,

Western Area Power Administration

Desert Southwest Customer Service Region

P.O. Box 6457

Phoenix, AZ 85005-6457

or e-mail to (jmurray@wapa.gov).

Revision of the Proposed Rates

After the consultation and comment period has expired and DSWR has conducted a thorough review of oral and written comments, DSWR may revise the proposed rate(s).  If Western's Administrator decides that further public comment on the revised proposed rate(s) should be invited, a second consultation and comment period may be initiated.  In that event, one or more additional meetings will be convened.

Decision on Proposed or Revised Proposed Rates

Following the end of the consultation and comment period(s), Western's Administrator will submit the proposed rates to the Deputy Secretary of Energy.  The Deputy Secretary may confirm, approve, and place the rates in effect on an interim basis.  The decision and an explanation of the principal factors leading to the decision will be announced in the Federal Register.  DSWR proposes to place the rate in effect on April 1, 2006.

Final Decision on the Rate Adjustment

The Deputy Secretary will submit all information concerning the provisional rates to FERC and request approval of the methodologies used in their development, for the period April 1, 2006, through March 31, 2011.  FERC may then confirm and approve the submittal, remand it to Western, or disapprove the submittal.

Return to Table of Contents

 


V. Environmental Requirements

Environmental Evaluation

In compliance with the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C. 4321 et seq.), the Council on Environmental Quality Regulations for implementing NEPA (40 CFR Parts 1500 through 1508), and the DOE NEPA Implementing Procedures and Guidelines (10 CFR Part 1021), Western conducts environmental evaluations of the proposed rates and develops the appropriate level of documentation.

 

 

Return to Table of Contents

 

 


 [s1]Is this SLCA/IP or CRSP?