[Federal Register Volume 60, Number 53 (Monday, March 20, 1995)]
[Notices]
[Pages 14754-14755]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-6799]



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DEPARTMENT OF ENERGY
Western Area Power Administration


Central Valley Project, Proposed Non-Federal Funding to Perform 
Rewindings With Uprates on Three Generators at the Shasta Dam 
Powerplant

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of intent to enter into a contract, along with the 
Department of the Interior, Bureau of Reclamation (Reclamation), to 
obtain non-Federal funding from Central Valley Project power 
contractors for maintenance and replacement work, to be performed by 
Reclamation, on the generators at Shasta Dam Powerplant.

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SUMMARY: The Western Area Power Administration (Western) provides 
notice that non-Federal funding will be obtained for Reclamation to 
perform rewindings with uprates on three generators at the Shasta Dam 
Powerplant in order to ensure system reliability. Several Central 
Valley Project (CVP) power contractors have voluntarily agreed to 
jointly provide financing to complete the proposed work. All CVP power 
contractors will be considered if they meet the conditions specified 
under ``Selection Criteria'' herein. A list of the CVP power 
contractors providing funding (Funding Entities) may be requested from 
Western at the address or telephone provided under ``For Further 
Information Contact'' herein.
    This notice presents background project information and outlines 
the terms of the proposed financing agreement and the projected work.

EFFECTIVE DATE: April 19, 1995.

FOR FURTHER INFORMATION CONTACT: Ms. Zola M. Jackson, Assistant Area 
Manager for Power Marketing, Sacramento Area Office, Western Area Power 
Administration, 1825 Bell Street, Suite 105, Sacramento, CA 95825, 
(916) 649-4421. [[Page 14755]] 

SUPPLEMENTARY INFORMATION:

Background

    The Shasta Dam Powerplant is located on the Sacramento River near 
the city of Redding, California. The powerplant is a feature of the 
Shasta Division, CVP, and was authorized to be built by the Emergency 
Relief Appropriations Act of 1935 (49 Stat. 115). Reclamation operates 
the 578-megawatt (MW) powerplant at Shasta Dam, and Western markets 
that power pursuant to section 302 of the Department of Energy 
Organization Act (42 U.S.C. 7152).
    Reclamation is responsible for planning, designing, constructing, 
operating, and maintaining electrical power generation facilities as 
authorized by Congress. Reclamation also is responsible for allocating 
all costs to water and power users for Reclamation project purposes and 
determining the reimbursable costs to be recovered by revenues. Western 
is responsible for marketing the power, constructing transmission 
facilities, making transmission arrangements, assuring recovery of all 
costs assigned to power for repayment, and for setting power and 
transmission rates. Reclamation and Western will work together in the 
negotiation and execution of contracts for the financing arrangements 
for the proposed project. Reclamation will be responsible for the 
negotiation and execution of the construction contracts.
    The Shasta Dam Powerplant has a total of seven generator units. 
There are five main generators and two station service generators. Main 
generator units 1 and 2 were uprated to 125 MW in 1978-80. Main 
generator units 3, 4, and 5 were rewound between 1969 and 1974 and 
modified in 1981. Due to age and deterioration, the core temperatures 
of main generator units 3, 4, and 5 have been steadily increasing for 
the last decade, threatening the reliability of these units. Should one 
or more of the units fail, the loss of power generation could increase 
power costs and decrease power revenues.

Financing Proposal

    Funds for constructing the rewinds with uprates at the Shasta Dam 
Powerplant will be made available to Reclamation under provision of the 
Act of March 4, 1921 (41 Stat. 1404). Western, the Funding Entities, 
and Reclamation will enter into a contract to assist in obtaining the 
funding necessary for Reclamation to perform the maintenance work at 
Shasta Dam Powerplant. The Funding Entities will advance approximately 
$20 million, the estimated total cost of the work to be performed, into 
an escrow account. Reclamation will withdraw the funds for the material 
and related expenses of the rewinds with uprates. The facilities will 
continue to be owned and operated by the United States as a feature of 
the CVP.
    A repayment agreement is proposed between the United States and the 
Funding Entities. The Funding Entities will be reimbursed for funds 
provided, with interest, through credits on their CVP power bills. All 
costs will be recovered through sales of power and water.
Description of Proposed Work to be Performed by Reclamation

    To ensure CVP system reliability, increase operational flexibility, 
and increase the nameplate rating of Shasta main generator units 3, 4, 
and 5, Reclamation will install new cores, windings, and excitation 
systems in addition to reinsulating or replacing the field windings. 
Reclamation will also install new thrust bearings to enable a faster 
unit start-up response time after emergency shutdowns.

Energy and Capacity Gains

    As a result of uprating main generator units 3, 4, and 5, there 
will be an estimated total gain of approximately 47 MW of capacity 
available when Shasta Lake storage level is above 3.6 million acre-feet 
(MAF). Below 3.6 MAF, the total peaking capability decreases and is 
reduced to 0 MW when the level falls below 2.3 MAF. Under high water 
conditions and maximum operational capability, some additional energy 
may be produced. This could amount to an estimated average annual 
increase of 12 gigawatthours. All additional energy and capacity 
resulting from the uprates will be incorporated into the CVP system to 
support project use and CVP power sales. CVP capacity may be sold as 
excess, when available.

Treatment of Excess Capacity

    If and when Western determines excess capacity is available for 
sale, the Funding Entities will be given first right of refusal for the 
purchase of excess capacity from the CVP system. Such right shall 
terminate on December 31, 2004. Such right of first refusal shall be 
limited to excess capacity purchases for a period of months in the year 
and to an amount of excess capacity equivalent to the amount resulting 
from the uprates of main generator units 3, 4, and 5, and only if 
Shasta Lake storage level is above 3.0 MAF at the time of the offer for 
sale. The determination of the amount of excess capacity available, 
period of availability, and terms of an offer will be at Western's 
discretion. Funding Entities must meet the marketing criteria for the 
excess capacity sale at the time of the offer.

Selection Criteria for Funding Entities

    Western determined that the following criteria must be met by 
entities financing the rewinds with uprates at Shasta Dam Powerplant.
    1. Funding must be advanced on behalf of an existing CVP firm power 
contractor who is a ``preference entity'' under Reclamation law and 
pertinent statutes, particularly section 9(c) of the Reclamation 
Project Act of 1939 (43 U.S.C. 485h(c)).
    2. Entities must voluntarily agree to fund the proposal under the 
terms and conditions offered by Western and be able to receive 
reimbursement of funds advanced on their CVP power bills.
    3. Entities must demonstrate their ability to provide funds for the 
proposed work.
    4. Entities must be willing to advance the funding in a manner 
acceptable to Reclamation.

Environmental Compliance: The National Environmental Policy Act 
(NEPA) of 1969 (42 U.S.C 4321 et seq.) and implementing regulations 
issued by the Council on Environmental Quality (40 CFR 1500-1508) 
require that the environmental effects of agency decisions be 
studied and considered by decision makers. For the construction 
work to be performed by Reclamation, Reclamation completed a 
Categorical Exclusion on August 5, 1994. This work will not change 
the operating parameters at Shasta Dam Powerplant.

    In addition, the environmental effects associated with the 
marketing of power generated at various facilities, including the 
Shasta Dam Powerplant, were examined under Western's 1994 Power 
Marketing Plan Environmental Assessment, as revised in August 1992 and 
for which a FONSI was issued on September 21, 1992; therefore, no 
further environmental review under NEPA will be required.

    Issued in Golden, Colorado, March 6, 1995.
J. M. Shafer,
Administrator.
[FR Doc. 95-6799 Filed 3-17-95; 8:45 am]
BILLING CODE 6450-01-P