[Federal Register Volume 79, Number 86 (Monday, May 5, 2014)]
[Notices]
[Pages 25593-25594]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-10227]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Falcon and Amistad Projects' Rate Order No. WAPA-164

AGENCY: Western Area Power Administration (Western), DOE.

ACTION: Notice of extension.

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SUMMARY: This action is to extend the existing Falcon and Amistad 
Projects' Firm Power Rate Formula, established in Rate Order No WAPA-
143, through June 7, 2019. The Falcon and Amistad Projects' Firm Power 
Rate Formula is set to expire June 7, 2014.

DATES: The rate formula extension will become effective on an interim 
basis June 8, 2014, and will remain interim until the Federal Energy 
Regulatory Commission (FERC) confirms, approves, and places the rate 
formula into effect on a final basis through June 7, 2019, or until 
superseded.

FOR FURTHER INFORMATION CONTACT: Ms. Lynn C. Jeka, Colorado River 
Storage Project (CRSP) Manager, Colorado River Storage Project 
Management Center, Western Area Power Administration, 150 East Social 
Hall Avenue, Suite 300, Salt Lake City, UT 84111-1580, (801) 524-6372, 
email [email protected], or Mr. Rodney Bailey, Power Marketing Manager, 
Colorado River Storage Project Management Center, Western Area Power 
Administration, 150 East Social Hall Avenue, Suite 300, Salt Lake City, 
UT 84111-1580, (801) 524-4007, email [email protected].

SUPPLEMENTARY INFORMATION: By Delegation Order No. 00-037.00A, the 
Secretary of Energy delegated: (1) The authority to develop power and 
transmission rates to the Administrator of Western; (2) the authority 
to confirm, approve, and place in effect such rates on an interim basis 
to the Deputy Secretary of the Department of Energy (DOE); and (3) the 
authority to confirm and approve on a final basis or to disapprove 
rates developed by the Administrator under the delegation to FERC. This 
extension is issued pursuant to the Delegation Order and DOE rate 
extension procedures at 10 CFR 903-23(a).
    The Falcon and Amistad Dams are features of international water 
storage projects located on the Rio Grande River between Texas and 
Mexico. Under the terms of Contract No. 7-07-50-P0890 (Contract), dated 
August 9, 1977, as amended, Western markets the power from these dams 
to South Texas Electric Cooperative, Inc. (STEC). The power rate 
formula of the Contract was approved by the Federal Power Commission 
(FPC), predecessor to FERC, in Docket No. E-9566 on August 12, 1977 (59 
FPC 1653), for a 5-year period effective on the date of initial 
operation of Amistad Power Plant, June 8, 1983.\1\
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    \1\ A 5-year rate extension of this same rate formula through 
June 7, 1993, was approved by FERC on July 20, 1988, at 44 FERC ] 
62,058. Subsequent 5-year extensions of the rate formula have been 
approved by FERC. The most recent approval was on December 17, 2009, 
in Docket No. EF09-5101-000, which approved the same rate formula 
through June 7, 2014 (129 FERC ] 62,206).
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    According to article 9(a) of the Contract, Western calculates the 
annual installment to be paid by the Customer for the power generated 
at the Falcon and Amistad power plants on or before August 31 of the 
year proceeding the fiscal year to which it pertains and identifies 
this amount in a revised Exhibit A to the Contract. Each annual 
installment pays the annual amortized portion of the United States' 
investment in the Falcon and Amistad hydroelectric facilities with 
interest, and the associated operation, maintenance, and administrative 
costs. This repayment schedule is not dependent upon the power and 
energy made available for sale or the rate of generation each year.
    Following review of Western's proposal within the Department of 
Energy, I hereby approve, on an interim basis, Rate Order No. WAPA-164, 
which extends, without adjustment, the existing Falcon and Amistad 
Projects' Power Rate Formula through June 7, 2019.\2\ The rate formula 
will be promptly submitted to FERC for confirmation and approval on a 
final basis.
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    \2\ Western's proposal published on February 21, 2014 (79 FR 
9897).

    Dated: April 28, 2014.
Daniel B. Poneman,
Deputy Secretary of Energy.

Deputy Secretary

    In the matter of: Western Area Power Administration Extension 
for Falcon and Amistad Projects' Power Rate Formula; Order 
Confirming and Approving an Extension of the Falcon and Amistad 
Projects' Power Rate Formula

    This Power Rate Formula extension was established following section 
302 of the Department of Energy (DOE) Organization Act (42 U.S.C. 
7152). This Act transferred to and vested in the Secretary of Energy 
the power marketing functions of the Secretary of the Department of the 
Interior and the Bureau of Reclamation (Reclamation) under the 
Reclamation Act of 1902 (ch. 1093, 32 Stat. 388), as amended and 
supplemented by subsequent laws, particularly section 9(c) of the 
Reclamation Act of 1939 (43 U.S.C. 485h(c)), and other acts that 
specifically apply to the project involved.
    By Delegation Order No. 00-037.00A, the Secretary of Energy 
delegated: (1) The authority to develop power and transmission rates to 
the Administrator of the Western Area Power Administration (Western); 
(2) the authority to confirm, approve, and place in effect such rates 
on an interim basis to the Deputy Secretary of Energy; and (3) the 
authority to confirm and approve on a final basis or to disapprove 
rates developed by the Administrator under the delegation to the 
Federal Energy Regulatory Commission (FERC). This extension is issued 
pursuant to the Delegation Order and DOE rate extension procedures at 
10 CFR 903-23(a).

Background

    On December 17, 2009, in Docket No. EF09-5101-000, FERC confirmed, 
approved, and placed into effect on a final basis the Falcon and 
Amistad Projects' Power Rate Formula, Rate Order No. WAPA-143. FERC 
approved the Power Rate Formula for 5 years beginning June 8, 2009, 
through June 7, 2014. On February 21, 2014, pursuant to 10 CFR 
903.23(a), Western filed a notice in the Federal Register proposing to 
extend, without adjustment, Falcon and Amistad Projects' Power Rate 
Formula as Rate Order No. WAPA-164. Consistent with its regulations at 
10 CFR 903.23(a), Western did not hold a consultation and comment 
period. Instead, Western stated its intent, via certified letter to 
South Texas Electric Cooperative, Inc (Customer), to extend the current 
Power Rate formula and received no adverse reactions.

Discussion

    On June 7, 2014, Western's Falcon and Amistad Projects' Power Rate 
Formula expires. The Power Rate Formula, calculated annually and based 
on 2 years of data, includes the projected costs of the rate 
installment year (future fiscal year) and an adjustment from the last 
historic fiscal year. The adjustment is the surplus or

[[Page 25594]]

deficit that occurs in the last historic fiscal year when actual costs 
and repayment obligations are subtracted from actual revenues. This 
surplus or deficit is combined with the projected rate installment year 
costs to arrive at the rate installment. This existing formula rate 
methodology collects annual revenue to recover annual expenses, 
including interest, capital requirements, and deficit recovery thus 
ensuring the Projects' repayment within the cost recovery criteria set 
forth in DOE Order RA 6120.2.
    The requested extension period, under Rate Order No. WAPA-164, 
beginning on June 8, 2014, through June 7, 2019, includes no adjustment 
to the Power Rate Formula. Under the existing Power Rate Formula, the 
forecasted revenue for the period is $35.5 million, an increase of $4.2 
million from the prior rate period, June 8, 2009, through June 7, 2014. 
The increase of $4.2 million includes over $4 million of forecasted 
increase in Operation and Maintenance, ensuring repayment within the 
cost recovery criteria.

Order

    In view of the foregoing and under the authority delegated to me, I 
confirm, approve, and place into effect on an interim basis an 
extension of the rate formula, effective June 8, 2014. The rate formula 
shall remain in effect on an interim basis, pending FERC's confirmation 
and approval of this or a substitute rate formula on a final basis, 
through June 7, 2019.

Dated: April 28, 2014.

Daniel B. Poneman,

Deputy Secretary of Energy.

[FR Doc. 2014-10227 Filed 5-2-14; 8:45 am]
BILLING CODE 6450-01-P