[Federal Register Volume 71, Number 6 (Tuesday, January 10, 2006)]
[Notices]
[Pages 1530-1531]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-123]


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DEPARTMENT OF ENERGY

Southwestern Power Administration


Robert D. Willis Hydropower Rate Schedules

AGENCY: Southwestern Power Administration, DOE.

ACTION: Notice of rate order.

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SUMMARY: Pursuant to Delegation Order Nos. 00-037.00, effective 
December 6, 2001, and 00-001.00B, effective July 28, 2005, the Deputy 
Secretary has approved and placed into effect on an interim basis Rate 
Order No. SWPA-55, which increases the power rate for the Robert 
Douglas Willis Hydropower Project (Willis) pursuant to the following 
Willis Rate Schedule:

Rate Schedule RDW-05, Wholesale Rates for Hydro Power and Energy 
Sold to Sam Rayburn Municipal Power Agency (Contract No. DE-PM75-
85SW00117).

The effective period for the rate schedule specified in Rate Order No. 
SWPA-55 is January 1, 2006, through September 30, 2009.

FOR FURTHER INFORMATION CONTACT: Mr. Forrest E. Reeves, Assistant 
Administrator, Office of Corporate Operations, Southwestern Power 
Administration, Department of Energy, One West Third Street, Tulsa, 
Oklahoma 74103, (918) 595-6696, [email protected].

SUPPLEMENTARY INFORMATION: The existing hydroelectric power rate for 
the Robert D. Willis project is $452,952 per year. The Federal Energy 
Regulatory Commission approved this rate on a final basis on June 24, 
2004, for the period November 1, 2003, through September 30, 2007. The 
2005 Willis Power Repayment Studies indicate the need for an increase 
in the annual rate by $195,144 or 43.1 percent beginning January 1, 
2006.
    The Administrator, Southwestern Power Administration (Southwestern) 
has followed Title 10, Part 903 Subpart A, of the Code of Federal 
Regulations, ``Procedures for Public Participation in Power and 
Transmission Rate Adjustments and Extensions'' (Part 903) in connection 
with the proposed rate schedule. On August 29, 2005, Southwestern 
published notice in the Federal Register (70 FR 51033), of a 60-day 
comment period, together with a Public Information Forum and a Public 
Comment Forum, to provide an opportunity for customers and other 
interested members of the public to review and comment on a proposed 
rate increase for the Willis project. Both public forums were canceled 
when no one expressed an intention to participate. Written comments 
were accepted through October 28, 2005. One comment was received from 
Gillis & Angley, Counsellors at Law, on behalf of Sam Rayburn Municipal 
Power Agency and the Vinton Public Power Authority, which stated that 
they had no objection to the proposed rate adjustment.
    Information regarding this rate proposal, 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 74103.
    Following review of Southwestern's proposal within the Department 
of Energy, I approved Rate Order No. SWPA-55, on an interim basis, 
which increases the existing Robert D. Willis rate to $648,096, per 
year, for the period January 1, 2006, through September 30, 2009.

    Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.

In the Matter of Southwestern Power Administration Robert D. Willis 
Hydropower Project Rate; Order Confirming, Approving and Placing 
Increased Power Rate Schedule in Effect on an Interim Basis

    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, relating to the Southwestern 
Power Administration (Southwestern) were transferred to and vested in 
the Secretary of Energy. By Delegation Order No. 0204-108, effective 
December 14, 1983, the Secretary of Energy delegated to the 
Administrator of Southwestern the authority to develop power and 
transmission rates, delegated to the Deputy Secretary of the Department 
of Energy the authority to confirm, approve, and place in effect such 
rates on an interim basis and delegated to the Federal Energy 
Regulatory Commission (FERC) the authority to confirm and approve on a 
final basis or to disapprove rates developed by the Administrator under 
the delegation. Delegation Order No. 0204-108, as amended, was 
rescinded and subsequently replaced by Delegation Orders 00-037.00 
(December 6, 2001) and 00-001-00B (July 28, 2005). The Deputy Secretary 
issued this rate order pursuant to said delegations.

Background

    Dam B (Town Bluff Dam), located on the Neches River in eastern 
Texas downstream from the Sam Rayburn Dam, was originally constructed 
in 1951 by the U.S. Army Corps of Engineers (Corps) and provides 
streamflow regulation of releases from the Sam Rayburn Dam. The Lower 
Neches Valley Authority contributed funds toward construction of both 
projects and makes established annual payments for the right to 
withdraw up to 2000 cubic feet of water per second from Town Bluff Dam 
for its own use. Power was

[[Page 1531]]

legislatively authorized at the project, but installation of 
hydroelectric facilities was deferred until justified by economic 
conditions. A determination of feasibility was made in a 1982 Corps 
study. In 1983, the Sam Rayburn Municipal Power Agency (SRMPA) proposed 
to sponsor and finance the development at Town Bluff Dam in return for 
the output of the project to be delivered to its member municipalities 
and participating member cooperatives of the Sam Rayburn Dam Electric 
Cooperative. Since the hydroelectric facilities at the Town Bluff Dam 
have been completed, the facilities have been renamed the Robert 
Douglas Willis Hydropower Project (Willis).
    The Willis rate is unique in that it excludes the costs associated 
with the hydropower design and construction performed by the Corps, 
because all funds for these costs were provided by SRMPA. Under the 
Southwestern/SRMPA power sales Contract No. DE-PM75-85SW00117, SRMPA 
will continue to pay all annual operating and marketing costs, as well 
as expected capital replacement costs, through the rate paid to 
Southwestern, and will receive all power and energy produced at the 
project for a period of 50 years.
    In the FERC Docket No. EF04-4081-000, issued June 24, 2004, for the 
period November 1, 2003, through September 30, 2007, the FERC confirmed 
and approved the current annual Willis rate of $452,952.

Discussion

    Southwestern's 2005 Current Power Repayment Study (PRS) indicates 
that the existing annual power rate of $452,952 does not represent the 
lowest possible rate needed to meet cost recovery criteria. The 
increased revenue requirement is due to an increase in the U.S. Army 
Corps of Engineers (Corps) projected future replacement investment and 
future operations and maintenance expense estimates. The Revised PRS 
indicates that an increase in annual revenues of $195,144 beginning 
January 1, 2006, is sufficient to accomplish repayment of the Federal 
investment in the required number of years. Accordingly, Southwestern 
developed a proposed rate schedule based on that increased revenue 
requirement.
    Title 10, Part 903, Subpart A of the Code of Federal Regulations, 
``Procedures for Public Participation in Power and Transmission Rate 
Adjustment,'' has been followed in connection with the proposed rate 
adjustment. More specifically, opportunities for public review and 
comment during a 60-day period on the proposed Willis power rate were 
announced by a Federal Register (70 FR 51033) notice published on 
August 29, 2005. A Public Information Forum was scheduled to be held 
September 13, 2005, and a Public Comment Forum was scheduled for 
October 13, 2005, both in Tulsa, Oklahoma. Both forums were canceled as 
no one expressed an intent to participate. Written comments were due by 
October 28, 2005. Southwestern provided the Federal Register notice, 
together with requested supporting data, to the customer and interested 
parties for review and comment during the formal period of public 
participation. In addition, prior to the formal 60-day public 
participation process, Southwestern discussed with the customer 
representatives the preliminary information on the proposed rate 
adjustment. Only one formal comment was received during the public 
process. That comment, on behalf of SRMPA and the Vinton Public Power 
Authority, expressed no objection to the final proposed rate. Upon 
conclusion of the comment period in October 2005, Southwestern 
finalized the PRS and rate schedule for the proposed annual rate of 
$648,096 which is the lowest possible rate needed to satisfy repayment 
criteria. This rate represents an annual increase of 43.1 percent.

Availability of Information

    Information regarding this rate increase, 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 74103.

Comments and Responses

    Southwestern received one written comment in which the customer 
representative expressed no objection to the proposed rate adjustment.

Other Issues

    There were no other issues raised during the informal meeting or 
during the formal public participation period.

Administrator's Certification

    The 2005 Revised Willis PRS indicates that the annual power rate of 
$648,096 will repay all costs of the project, including amortization of 
the power investment consistent with provisions of the Department of 
Energy (DOE) Order No. RA 6120.2. In accordance with Delegation Order 
Nos. 00-037.00 (December 6, 2001) and 00-001.00A (September 17, 2002), 
and Section 5 of the Flood Control Act of 1944, the Administrator has 
determined that the proposed Willis power rate is consistent with 
applicable law and the lowest possible rate consistent with sound 
business principles.

Environment

    The environmental impact of the rate increase proposal was 
evaluated in consideration of DOE's guidelines for implementing the 
procedural provisions of the National Environmental Policy Act, 10 CFR 
part 1021, and was determined to fall within the class of actions that 
are categorically excluded from the requirements of preparing either an 
Environmental Impact Statement or an Environmental Assessment.

Order

    In view of the foregoing and pursuant to the authority delegated to 
me, I hereby confirm, approve and place in effect on an interim basis, 
for the period January 1, 2006, through September 30, 2009, the annual 
Robert D. Willis Rate of $648,096 for the sale of power and energy from 
Robert D. Willis project to the Sam Rayburn Municipal Power Agency, 
under Contract No. DE-PM75-85SW00117, as amended. This rate shall 
remain in effect on an interim basis through September 30, 2009, or 
until the FERC confirms and approves the rate on a final basis.

    Dated: December 23, 2005.
Clay Sell,
Deputy Secretary.
[FR Doc. E6-123 Filed 1-9-06; 8:45 am]
BILLING CODE 6450-01-P