Proposed Rates for Washoe Project-Nonfirm Power

AGENCY:

Western Area Power Administration, DOE.

ACTION:

Notice of proposed rates.

SUMMARY:

The Western Area Power Administration (Western) is proposing rates to sell nonfirm energy from Stampede Powerplant (Stampede) of the Washoe Project. Stampede is in Sierra County, California. The current rates expire September 30, 2000. The proposed rates will provide sufficient revenue to repay all annual costs, including interest expense, and repay required investment within the allowable period. Rate impacts are detailed in a rate brochure to be provided to all interested parties. Proposed rates are scheduled to go into effect on October 1, 2000, to correspond with the start of the Federal fiscal year (FY), and will remain in effect through September 30, 2005. This Federal Register notice initiates the formal process for the proposed rates.

DATES:

The consultation and comment period begins today and will end April 27, 2000. During this period Western will accept written comments from interested parties.

ADDRESSES:

Send written comments to Mr. Jerry W. Toenyes, Regional Manager, Sierra Nevada Customer Service Region, Western Area Power Administration, 114 Parkshore Drive, Folsom, CA 95630-4710. Western must receive written comments by the end of the consultation and comment period to assure they are considered.

FOR FURTHER INFORMATION CONTACT:

Ms. Debbie Dietz, Rates Manager, Sierra Nevada Customer Service Region, Western Area Power Administration, 114 Parkshore Drive, Folsom, CA 95630-4710, telephone (916) 353-4453.

SUPPLEMENTARY INFORMATION:

Proposed rates for the sale of nonfirm energy from Stampede consist of floor and ceiling rates and are designed to recover an annual revenue requirement that includes investment repayment, interest, project use costs, and operation and maintenance expense. A power repayment study indicates the ceiling rate provides sufficient revenue to repay all annual costs, including interest expense, and the investment within the allowable period. Other analyses indicate the proposed floor rate provides sufficient revenue to pay annual operation and maintenance expenses. Proposed floor and ceiling rates for nonfirm energy from Stampede Powerplant are 17.89 mills/kilowatthour (mills/kWh) and 90.07 mills/kWh, respectively. The proposed rates are designed to ensure maximum recovery of annual revenue requirement at marketable rates.

To serve project use loads and market the energy from Stampede, Western's contract with Sierra Pacific Resources (Sierra) provides for the Stampede Energy Exchange Account (SEEA). SEEA is an annual energy exchange account for Stampede energy. Under this contract, Sierra accepts delivery of all energy generated from Stampede into Sierra's electrical system. The dollar value of the Stampede energy received by Sierra during any month is credited into the SEEA. Western uses the SEEA to benefit project use facilities, market energy from Stampede to preference entities over Sierra's transmission system, and sell a portion of the energy to Sierra. Beginning January 1, 2005, energy available after meeting project use requirements will be sold to the Central Valley Project (CVP) at the ceiling rate, as provided in the CVP 2004 Marketing Plan. As long as Western has a balance in the SEEA, Western and Sierra agree to do any combination of the above transactions in any month.

After meeting project use power requirements, the remaining energy available through the SEEA is sold either to Sierra at the proposed floor rate or to other entities, giving priority to preference customers, at a rate not greater than the proposed ceiling rate but more than the proposed floor rate. The formula for the proposed floor rate is equal to 85 percent of the then effective, nontime differentiated rate provided in Sierra's California Quarterly Short Term Purchase Price Schedule for As-Available Purchases from Qualifying Facilities with Capacities of 100 kilowatts (kW) or Less. This floor rate reflects the rate used to determine a value of the SEEA for the benefit of project use facilities. Western determines the proposed ceiling rate as the rate necessary to repay the Stampede annual expenses and power investment over the remaining repayment period of the power facilities.

A comparison of existing and proposed rates follows:

Stampede Powerplant is a feature of the Washoe Project authorized by Congress in 1956 and is located on the Little Truckee River in Sierra County, California. The powerplant has a maximum operating capability of 3,650 kW with an estimated annual generation of 11 million kWh. Since Stampede Powerplant has an installed capacity of less than 20,000 kW and generates less than 100 million kWh annually for sale, the proposed rates constitute a minor rate adjustment. Western has determined that it is not necessary to hold a public information or comment forum for this proposed minor rate adjustment (10 CFR 903). After Western reviews the comments received, it will recommend the proposed rates (and as amended) for approval on an interim basis by the Department of Energy (DOE) Deputy Secretary.

Legal Authority

These nonfirm energy rates for Stampede are established under the DOE Organization Act, 42 U.S.C. 7101-7352; the Reclamation Act of 1902, ch. 1093, 32 Stat. 388, 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 other acts specifically applicable to the project involved.

By Amendment No. 3 to Delegation Order No. 0204-108, published November 10, 1993 (58 FR 59716), the Secretary of Energy delegated (1) the authority to develop long-term power and transmission rates on a nonexclusive basis to Western's Administrator; and (2) the authority to confirm, approve and place into effect on a final basis, to remand, or to disapprove such rates to FERC. In Delegation Order No. 0204-172, effective November 24, 1999, the Secretary of Energy delegated the authority to confirm, approve and place such rates into effect on an interim basis to the Deputy Secretary. 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

The rate brochure, studies, comments, letters, memorandums, and other documents made or kept by Western in developing the proposed rates to sell nonfirm energy from Stampede are available for inspection and copying at the Sierra Nevada Customer Service Regional Office, at 114 Parkshore Drive, Folsom, California.

Regulatory Procedural Requirements

Regulatory Flexibility Analysis

The Regulatory Flexibility Act of 1980 (5 U.S.C. 601, et seq.) requires Federal agencies to perform a regulatory flexibility analysis if a final rule is likely to have a significant economic impact on a substantial number of small entities and there is a legal requirement to issue a general notice of proposed rulemaking. Western has determined that this action does not require a regulatory flexibility analysis since it is a rulemaking involving rates or services for public property.

Environmental Compliance

In compliance with the National Environmental Policy Act (NEPA), of 1969, 42 U.S.C. 4321, et seq., Council on Environmental Quality Regulations (40 CFR parts 1500-1508); and the DOE NEPA Regulations (10 CFR part 1021), Western has determined that this action is categorically excluded from the preparation of an environmental assessment or an environmental impact statement.

Determination Under Executive Order 12866

Western 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.

Small Business Regulatory Enforcement Fairness Act

Western has determined that this rule is exempt from congressional notification requirements under 5 U.S.C. 801 because the action is a rulemaking of particular applicability relating to rates or services and involves matters of procedure.