[Federal Register Volume 81, Number 22 (Wednesday, February 3, 2016)]
[Notices]
[Pages 5741-5744]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-01977]


-----------------------------------------------------------------------

DEPARTMENT OF ENERGY

Western Area Power Administration


Desert Southwest Customer Service Region Network Integration 
Transmission Service and Ancillary Services--Rate Order No. WAPA-175

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of Proposed Formula Rates for Network Integration 
Transmission Service and Ancillary Services.

-----------------------------------------------------------------------

SUMMARY: The Western Area Power Administration (Western) Parker-Davis 
(P-DP) and Pacific Northwest-Pacific Southwest Intertie (Intertie) 
Projects' Network Integration Transmission Service (NITS) formula rates 
under Rate Schedules PD-NTS3, INT-NTS3 and Western Area Lower Colorado 
Balancing Authority's (WALC) Ancillary Services formula rates under 
Rate Schedules DSW-SD3, DSW-RS3, DSW-FR3, DSW-EI3, DSW-GI1, DSW-SPR3, 
and DSW-SUR3 expire on September 30, 2016. Western is proposing 
modifications to the existing formula rate schedules and adding two new 
rate schedules, referred to as Transmission Losses Services (DSW-TL1) 
and Penalty Rate for Unreserved Use of Transmission Service (DSW-UU1). 
Western will prepare a brochure that provides detailed information on 
the proposed formula rates. If adopted, the proposed formula rates, 
under Rate Schedules PD-NTS4, INT-NTS4, DSW-TL1, DSW-UU1, DSW-SD4, DSW-
RS4, DSW-FR4, DSW-EI4, DSW-GI2, DSW-SPR4, and DSW-SUR4 will become 
effective October 1, 2016, and will remain in effect through September 
30, 2021, or until superseded. Publication of this Federal Register 
notice (FRN) begins the formal process for the proposed formula rates.

DATES: The consultation and comment period begins today and will end 
May 3, 2016. Western will present a detailed explanation of the 
proposed formula rates and other modifications addressed

[[Page 5742]]

in this FRN at a public information forum that will be held on March 
30, 2016, from 10 a.m. to no later than 12 p.m. MST. Western will 
accept oral and written comments at a public comment forum that will be 
held on March 30, 2016, from 1 p.m. to no later than 3 p.m. MST. 
Western will accept written comments any time during the consultation 
and comment period.

ADDRESSES: The location for both the public information forum and the 
public comment forum is the Western Area Power Administration, Desert 
Southwest Customer Service Regional Office, located at 615 South 43 
Avenue, Phoenix, Arizona, 85009. Send written comments to Mr. Ronald E. 
Moulton, Regional Manager, Desert Southwest Customer Service Region, 
Western Area Power Administration, P.O. Box 6457, Phoenix, Arizona 
85005-6457, email [email protected]. Written comments may also be faxed 
to (602) 605-2490, attention: Mr. Scott Lund, Rates Manager. Western 
will post information about the rate process, as well as comments 
received via letter, email, and fax, on its Web site at: http://www.wapa.gov/regions/DSW/Rates/Pages/ancillary-rates-2017.aspx. Written 
comments must be received by the end of the consultation and comment 
period to be considered by Western in its decision process.
    As access to Western facilities is controlled, any United States 
(U.S.) citizen wishing to attend must present an official form of 
picture identification (ID) such as a U.S. driver's license, U.S. 
passport, U.S. Government ID, or U.S. Military ID prior to signing into 
Western. Foreign nationals should contact Western via Mr. Scott Lund, 
Rates Manager, telephone (602) 605-2442 or email [email protected] 30 days 
in advance of the meeting to obtain the necessary form for admittance 
to Western's Desert Southwest Office.

FOR FURTHER INFORMATION CONTACT: Mr. Scott Lund, Rates Manager, Desert 
Southwest Customer Service Region, Western Area Power Administration, 
P.O. Box 6457, Phoenix, Arizona 85005-6457, telephone (602) 605-2442 or 
email [email protected].

SUPPLEMENTARY INFORMATION: Under the existing formula rate schedules 
approved under Rate Order No. WAPA-151,\1\ charges are recalculated 
annually using updated financial and load information, as applicable. 
The proposed formula rates continue this approach. If adopted, these 
proposed formula rates will be in effect October 1, 2016, through 
September 30, 2021. This FRN describes proposed changes to the services 
referenced below.
---------------------------------------------------------------------------

    \1\ WAPA-151 was approved by FERC on a final basis on March 5, 
2012, in Docket No. EF11-14-000 (138 FERC ] 62,198).
---------------------------------------------------------------------------

Transmission Services

Network Integration Transmission Service (Rate Schedule PD-NTS4 and 
INT-NTS4)

    Western proposes no changes to the NITS formula rates on the P-DP 
and Intertie, but proposes to make minor editorial changes to the rate 
schedule. Those edits would consist of removing the section setting 
forth the annual revenue requirements as well as moving the 
transmission losses language to a new rate schedule. In the future, the 
revenue requirements will be identified in a separate tracking document 
posted on Western's Web site, as well as posted on Western's 
Transmission Services Open Access Same Time Information System (OASIS) 
Web site for WALC.

Transmission Losses Service (Rate Schedule DSW-TL1)

    Western proposes no changes to the existing transmission losses 
language and application; instead, it proposes moving the loss 
adjustment sections for each project into a single WALC formula rate 
schedule. This single WALC formula rate schedule will supersede the 
language in the existing individual schedules. WALC loss rates were 
developed in 2004 and are applied in three of Western's transmission 
systems: P-DP, Intertie and Central Arizona Project (CAP). Creating a 
single WALC formula rate schedule for transmission losses will ensure 
consistent language across projects.

Penalty Rate for Unreserved Use of Transmission Service (Rate Schedule 
DSW-UU1)

    Western proposes creating a new formula rate schedule for Penalty 
Rate for Unreserved Use of Transmission Service. Although charges are 
already assessed in each transmission rate schedule for any unreserved 
use of the transmission system, creating a new schedule will allow for 
consistent treatment across projects.
    The proposed charge for unreserved use is two times the maximum 
allowable rate for the service at issue, assessed as follows: The 
penalty for a single hour of unreserved use is based on the daily 
short-term transmission rate. The penalty for more than one instance of 
unreserved use for any given duration (e.g., daily) increases to the 
next longest duration (e.g., weekly). The penalty for multiple 
instances of unreserved use (e.g., more than one hour) within a day is 
based on the daily rate for short-term transmission service. The 
penalty for multiple instances of unreserved use isolated to one 
calendar week is based on the weekly short-term rate. The penalty for 
multiple instances of unreserved use during more than one week in a 
calendar month is based on the monthly short-term rate.
    A customer that exceeds its reserved capacity at any point of 
receipt or point of delivery, or a customer that uses transmission 
service at a point of receipt or point of delivery that it has not 
reserved, is required to pay for all Ancillary Services provided by 
WALC and associated with the unreserved use. Customers must pay for 
Ancillary Services based on the amount of transmission service used and 
not reserved.

Ancillary Services

Scheduling, System Control, and Dispatch Service (Rate Schedule DSW-
SD4)

    Western proposes no changes to the Scheduling, System Control, and 
Dispatch formula rate, but plans to make minor editorial changes to the 
rate schedule. Those edits would consist of minor changes to the 
language within the ``applicable'' section and removing the section 
setting forth the annual charge. In the future, the annual charge will 
be identified in a separate tracking document posted on Western's Web 
site as well as the WALC OASIS Web site.

Reactive Supply and Voltage Control From Generation or Other Sources 
Service (Rate Schedule DSW-RS4)

    Western proposes no changes to the Reactive Supply and Voltage 
Control from Generation or Other Sources Service formula rate, but 
proposes to make minor editorial changes to the rate schedule. Those 
edits would consist of minor changes to the language within the 
``applicable'' section and removing the section setting forth the 
annual charge. In the future, the annual charge will be identified in a 
separate tracking document posted on Western's Web site as well as the 
WALC OASIS Web site.

Regulation and Frequency Response Service (Rate Schedule DSW-FR4)

    In order to more accurately allocate costs based on cost causation 
principles, Western is proposing a change to the current load-based 
assessment of the Regulation and Frequency Response Service (Regulation 
Service) formula rate. The current load-based assessment is applicable 
to (1) all load inside WALC and (2) installed nameplate capacity of all 
intermittent resources serving load inside WALC.

[[Page 5743]]

    Western is not proposing any changes to the application of the 
load-based assessment for the load inside WALC. The charge will 
continue to be one-for-one for each megawatt (MW) of load inside WALC. 
Western is, however, proposing to modify the one-for-one MW load-based 
assessment for the installed nameplate of intermittent resources 
serving load inside WALC. It would instead include a ``variable 
capacity multiplier'' to be applied to the installed capacity for 
Variable Energy Resources (VER) serving load inside WALC.
    The proposed formula rate for Regulation Service is as follows:
    [GRAPHIC] [TIFF OMITTED] TN03FE16.006
    
    Regulation Service is necessary to provide continuous balancing of 
resources with obligations and for maintaining scheduled 
interconnection frequency at sixty cycles per second (60 Hz). 
Regulation Service is accomplished by committing on-line generation 
whose output is raised or lowered as necessary, predominantly through 
the use of automatic generation control equipment to follow moment-by-
moment changes in load. The obligation to maintain this balance between 
resources and load lies with the Transmission Service Provider (TSP) or 
the Control Area operator who performs this function for the TSP. The 
TSP must offer this service when the transmission service is used to 
serve load within its balancing authority area.
    Western markets the maximum amount of power from its Federal 
projects, leaving little flexibility for additional regulation needs 
within WALC. Connecting VER to the system would result in a significant 
increase in regulation needs and costs, and present operational 
constraints in managing the significant fluctuations normally 
associated with VER. These costs get spread to all customers taking 
Regulation Service regardless of their ability or inability to 
influence the condition.
    The Annual Revenue Requirement for Regulation Service will not be 
affected by the inclusion of the multipliers. The proposed change will 
result in the denominator increasing because more units of capacity 
will be charged, which in turn will cause the overall Regulation 
Service charge to be lower. The lower charge will then be allocated to 
each unit of capacity, thereby lowering the costs incurred by the load 
and assigning more of the costs for regulating capacity to those 
customers predominately contributing to the need for Regulation 
Service.
    In order to determine the ``variable capacity multipliers'', 
Western has developed a regulation analysis tool that will allow WALC 
to determine the hourly impacts of both load and variable energy 
generation on WALC. The regulation analysis tool focuses on 95 percent 
(%) of the events where WALC's Area Control Error limit was exceeded 
within the 10 minute duration range.
    WALC does not have a significant amount of wind or solar generation 
impacting its balancing authority area and, therefore, does not have 
sufficient data to perform a thorough analysis at this time. Therefore, 
Western proposes to assess a wind and solar capacity multiplier of 1.00 
or 100%. This number does not change the current denominator, but it 
allows the denominator to change if and when VER becomes a resource 
within WALC.
    In addition, Western proposes to make minor editorial changes to 
the Regulation Service rate schedule. Those edits would consist of 
minor changes to the language within the ``applicable'' section and 
removing the section setting forth the annual charge. In the future, 
the annual charge will be identified in a separate tracking document 
posted on Western's Web site as well as the WALC OASIS Web site.

Energy and Generator Imbalance Services (Rate Schedules DSW-EI4 and 
DSW-GI2)

    Western is proposing a change to the off-peak penalty bandwidths 
for Energy and Generator Imbalance Services (Imbalance Services). The 
off-peak penalty and bandwidth structure will consist of three 
deviation bands similar to the on-peak structure. This would coincide 
with FERC Order 890 guidelines with adjustments for WALC operating 
conditions. The proposed bandwidths are as follows:
    (1) Off-Peak Hours +/- 0 percent to 1.5 percent of metered load/
generation (0 to 4 MW minimum) with no penalty within bandwidth.
    (2) Off-Peak Hours +/-1.5 percent to 7.5 percent of metered load/
generation (4 to 10 MW minimum) with 110 percent return for under-
deliveries and 75 percent return for over-deliveries.
    (3) Off-Peak Hours > +/-7.5 percent of metered load/generation (>10 
MW minimum) with 125 percent return for under-deliveries and 60 percent 
for over-deliveries.
    In addition, Western proposes to make minor editorial changes to 
the Imbalance Services rate schedules. Those edits would consist of 
minor changes to the language within the ``applicable'' section and 
removing the section setting forth the annual charge. In the future, 
the annual charge will be identified in a separate tracking document 
posted on Western's Web site as well as the WALC OASIS Web site.

Operating Reserves Service--Spinning and Supplemental (Rate Schedules 
DSW-SPR4 and DSW-SUR4)

    Western proposes no changes to the Spinning and Supplemental 
Reserves Service formula rates, but proposes to make minor editorial 
changes to the rate schedules. Those edits would consist of changes to 
the language within the ``applicable'' section and removing the section 
setting forth the annual charge. In the future, the annual charge will 
be identified in a separate tracking document posted on Western's Web 
site as well as the WALC OASIS Web site.

[[Page 5744]]

Legal Authority

    Western will hold both a public information forum and a public 
comment forum. After review of public comments, Western will take 
further action on the proposed formula rates and other modifications 
addressed in this FRN, and follow procedures for public participation 
consistent with 10 CFR part 903.
    Western is establishing P-DP and Intertie NITS and WALC Ancillary 
Services formula rates under the Department of Energy (DOE) 
Organization Act (42 U.S.C. 7152); 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 section 5 of the Flood Control Act of 1944 
(16 U.S.C. 825s); and other acts specifically applicable to the 
projects involved.
    By Delegation Order No. 00-037.00A, effective December 25, 2013, 
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 Federal Energy Regulatory Commission.

Availability of Information

    All brochures, studies, comments, letters, memorandums, or other 
documents Western initiates or uses to develop the proposed formula 
rates are available for inspection and copying at the Desert Southwest 
Customer Service Regional Office, Western Area Power Administration, 
located at 615 South 43rd Avenue, Phoenix, Arizona 85009. Many of these 
documents and supporting information are available on Western's Web 
site at: http://www.wapa.gov/regions/DSW/Rates/Pages/ancillary-rates-2017.aspx.

Ratemaking Procedure Requirements

Environmental Compliance

    In compliance with the National Environmental Policy Act (NEPA) of 
1969, 42 U.S.C. 4321-4347; the Council on Environmental Quality 
Regulations for implementing NEPA (40 CFR parts 1500-1508); and DOE 
NEPA Implementing Procedures and Guidelines (10 CFR part 1021), Western 
is in the process of determining whether an environmental assessment or 
an environmental impact statement should be prepared or if this action 
can be categorically excluded from those requirements.

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.

    Dated: January 20, 2016.
Mark A. Gabriel,
Administrator.
[FR Doc. 2016-01977 Filed 2-2-16; 8:45 am]
 BILLING CODE 6450-01-P