[Federal Register Volume 71, Number 41 (Thursday, March 2, 2006)]
[Notices]
[Pages 10664-10666]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-2955]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Boulder Canyon Project

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of proposed base charge and rates adjustment.

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SUMMARY: The Western Area Power Administration (Western) is proposing 
an adjustment to the Boulder Canyon Project (BCP) electric service base 
charge and rates. The current base charge and rates expire September 
30, 2006. The current base charge is not sufficient to pay all annual 
costs including operation, maintenance, replacements, interest expense, 
and to repay investment obligations within the required period. The 
proposed base charge will provide sufficient revenue to pay all annual 
costs and to repay investment obligations within the allowable period. 
A detailed rate package that identifies the reasons for the base charge 
and rates adjustment will be available in March 2006. The

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proposed base charge and rates are scheduled to become effective on 
October 1, 2006, and will remain in effect through September 30, 2007. 
This Federal Register notice initiates the formal process for the 
proposed base charge and rates.

DATES: The consultation and comment period will begin today and will 
end May 31, 2006. Western representatives will explain the proposed 
base charge and rates at a public information forum on April 4, 2006, 
beginning at 10:30 a.m. MST, in Phoenix, Arizona (AZ). Interested 
parties can provide oral and written comments at a public comment forum 
on May 3, 2006, beginning at 10:30 a.m. MST, at the same location.

ADDRESSES: The meetings will be held at the Desert Southwest Customer 
Service Regional Office, located at 615 South 43rd Avenue, Phoenix, AZ. 
Send comments to: Mr. J. Tyler Carlson, Regional Manager, Desert 
Southwest Customer Service Region, Western Area Power Administration, 
P.O. Box 6457, Phoenix, AZ 85005-6457, e-mail [email protected]. Western 
will post information about the rate process on its Web site at http://www.wapa.gov/dsw/pwrmkt/BCP/RateAdjust.htm. Western must receive 
comments by the end of the consultation and comment period to be 
assured consideration.

FOR FURTHER INFORMATION CONTACT: Mr. Jack Murray, Rates Team Lead, 
Desert Southwest Customer Service Region, Western Area Power 
Administration, P.O. Box 6457, Phoenix, AZ 85005-6457, telephone (602) 
605-2442, e-mail [email protected].

SUPPLEMENTARY INFORMATION: The proposed base charge and rates for BCP 
electric service are designed to recover an annual revenue requirement 
that includes the investment repayment, interest, operation and 
maintenance, replacements, payment to states, visitor services and 
uprating payments. These annual costs are reduced by the projected 
revenue from water sales, visitor services, water pump energy sales, 
facility use charges, regulation and spinning reserve services, 
miscellaneous leases and late fees. The projected annual revenue 
requirement is the base charge for electric service and is divided 
equally between capacity and energy. Annual energy dollars are divided 
by annual energy sales, and annual capacity dollars are divided by 
annual capacity sales to determine the proposed energy rate and the 
proposed capacity rate.
    The Deputy Secretary of the Department of Energy (DOE) approved the 
existing rate formula for calculating the base charge and rates in Rate 
Schedule BCP-F7 for BCP firm power service on August 11, 2005, (Rate 
Order No. WAPA-120, 70 FR 50316, August 26, 2005). The rate formula has 
been submitted to the Federal Energy Regulatory Commission for 
approval. Rate Schedule BCP-F7 became effective on October 1, 2005, for 
the period ending September 30, 2010. Under Rate Schedule BCP-F7 for FY 
2007, the base charge is $62,177,350, the forecasted energy rate is 
8.10 mills per kilowatthour (mills/kWh), the forecasted capacity rate 
is $1.48 per kilowattmonth (kWmonth) and the composite rate is 16.21 
mills/kWh.
    Under Rate Schedule BCP-F7, the proposed rates for BCP electric 
service will result in an overall composite rate increase of about 15 
percent. The following table compares the current and proposed base 
charge and rates.

                            Comparison of Current and Proposed Base Charge and Rates
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                                                          Current October    Proposed October
                                                          1, 2005 through    1, 2006 through     Percent change
                                                           September 30,      September 30,         increase
                                                                2006               2007
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Total Composite (mills/kWh)............................              14.05              16.21                 15
Base Charge ($)........................................         57,465,018         62,177,350                  8
Energy Rate (mills/kWh)................................               7.03               8.10                 15
Capacity Rate ($/kWmonth)..............................               1.37               1.48                  8
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    The increase in the base charge and rates is primarily the result 
of higher annual costs in operation and maintenance and lower revenue 
projections for the visitor center, as well as continued drought 
conditions. Additionally, the FY 2006 base charge and rates included a 
carry-over of non-reimbursable security costs from FY 2005, which had 
the effect of suppressing the FY 2006 base charge.

Legal Authority

    Western will hold both a public information forum and a public 
comment forum. After considering comments, Western will recommend the 
proposed base charge and rates for final approval by the Deputy 
Secretary of Energy.
    Western is establishing an electric service base charge and rates 
for BCP under the DOE Organization Act, (42 U.S.C. 7152); the 
Reclamation Act of 1902, (ch. 1093, 32 Stat. 388), as amended and 
supplemented by subsequent laws, particularly section 9(c) of the 
Reclamation Project Act of 1939, (43 U.S.C. 485h(c)); and other acts 
that specifically apply to the project involved.
    By Delegation Order No. 00-037.00, effective December 6, 2001, the 
Secretary of Energy delegated: (1) The authority to develop power and 
transmission rates to Western's Administrator, (2) the authority to 
confirm, approve, and place such rates into effect on an interim basis 
to the Deputy Secretary of Energy, and (3) the authority to confirm, 
approve, and place into effect on a final basis, to remand or to 
disapprove such rates to the Commission. Existing Department of Energy 
(DOE) procedures for public participation in power rate adjustments (10 
CFR part 903) were published on September 18, 1985 (50 FR 37835).

Availability of Information

    Interested parties may review and copy all brochures, studies, 
comments, letters, memorandums or other documents that Western 
initiates or uses to develop the proposed rates. These documents are 
available for inspection and copying at the Desert Southwest Customer 
Service Regional Office, located at 615 South 43rd Avenue, Phoenix, AZ.

Regulatory Procedure 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. This action does not 
require a regulatory flexibility analysis since it

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is a rulemaking specifically involving rates or services applicable to 
public property.

Environmental Compliance

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

    Dated: February 15, 2006.
Michael S. Hacskaylo,
Administrator.
[FR Doc. E6-2955 Filed 3-1-06; 8:45 am]
BILLING CODE 6450-01-P