[Federal Register Volume 86, Number 212 (Friday, November 5, 2021)]
[Notices]
[Pages 61211-61219]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-24217]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Salt Lake City Area Integrated Projects--Rate Order No. WAPA-199

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of rate order concerning fixed firm power rates.

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SUMMARY: The fixed firm power rates for the Salt Lake City Area 
Integrated Projects (SLCA/IP) (Provisional Rates) have been confirmed, 
approved, and placed into effect on an interim basis. Based on the FY 
2021 financial toll on the Upper Colorado River Basin Fund (Basin Fund) 
and the drought-impacted purchased power projections from the Bureau of 
Reclamation (Reclamation) August 2021 24-Month Study for FY 2022 and FY 
2023 and the August 2021 Colorado River Simulation System (CRSS) traces 
for FY 2024 through FY 2026, existing rates will not sustain a balance 
in the Basin Fund capable of supporting operations. The Colorado River 
Storage Project Management Center (CRSP MC) of the Western Area Power 
Administration (WAPA) is implementing a new SLCA/IP firm power rate, 
effective December 1, 2021, through December 31, 2023.

DATES: The Provisional Rates under Rate Schedule SLIP-F12 are effective 
on the first day of the first full billing period beginning on or after 
December 1, 2021, and will remain in effect through December 31, 2023, 
pending confirmation and approval by the Federal Energy Regulatory 
Commission (FERC) on a final basis or until superseded.

FOR FURTHER INFORMATION CONTACT: Tim Vigil, CRSP Manager, Colorado 
River Storage Project Management Center, Western Area Power 
Administration, 1800 South Rio Grande Avenue, Montrose, CO 81401, or 
email: [email protected], or Thomas Hackett, Rates Manager, 
801-524-5503, or email: [email protected].

SUPPLEMENTARY INFORMATION: On December 17, 2020, FERC confirmed and 
approved Rate Schedules SLIP-F11 (SLCA/IP Firm Power), SP-NW5 (Network 
Integration Transmission Service), SP-PTP9 (Firm Point-to-Point 
Transmission Service), SP-NFT8 (Non-Firm Point-to-Point Transmission 
Service), SP-UU2 (Unreserved Use Penalties), SP-EI5 (Energy and 
Generator Imbalance Services), SP-SSR5 (Operating Reserves--Spinning 
and Supplemental Reserve Services), and SP-SS1 (Sale of Surplus 
Products) under Rate Order No. WAPA-190 (WAPA-190) on a final basis 
through September 30, 2025.\1\
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    \1\ Order Confirming and Approving Rate Schedules on a Final 
Basis, FERC Docket No. EF20-7-000, 173 FERC ] 61,230 (2020).
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    WAPA published a Federal Register notice (Proposed FRN) on June 28, 
2021 (86 FR 34002), proposing modifications to only the firm power rate 
schedule (SLIP-F11) established under WAPA-190. CRSP MC did not propose 
any changes to the transmission and ancillary services rate schedules 
established under WAPA-190, and they remain effective under WAPA-190 
through September 30, 2025. The Proposed FRN also initiated a public 
consultation and comment period and set forth the date and location of 
the public information and public comment forums.
    WAPA is implementing the firm power rate under Rate Schedule SLIP-
F12 to address worsening drought conditions in the southwestern United 
States and volatile purchased power costs. The rates will go into 
effect December 1, 2021, and remain in effect until December 31, 2023, 
or until WAPA supersedes or changes the rates through another public 
rate process pursuant to 10 CFR part 903, whichever occurs first. The 
CRSP MC is only implementing the rate for 25 months to continue 
collaborative conversations with customers and interested parties on 
the most effective use of available generation and long-term strategies 
for managing the cost of purchased power. CRSP MC is basing FY 2022 and 
FY 2023 energy sales in the rate-setting Power Repayment Study (PRS) on 
the Reclamation August 2021 24-month Study, and FY 2024 through FY 2026 
sales on the CRSS traces and is forgoing purchased power in the rates. 
Forgoing purchased power decreased the projected rate increase from 50 
percent to 11 percent. CRSP MC will not be purchasing firming power to 
meet Sustainable Hydropower (SHP) levels as it has in the past. 
Calculated sales for the effective period of the rate will be limited 
to forecasted generation, referred to as the Deliverable Sales Amount 
(DSA). The DSA levels will be updated quarterly and provided to 
customers for power scheduling and billing purposes. These quarterly 
updates do not impact the rates. CRSP MC will firm to the DSA level if 
necessary. For those customers who elect, CRSP MC will offer Western 
Replacement Firming (WRF) purchased power to customers, as a pass-
through cost at market rates, to firm to SHP levels. Customers electing 
not to take WRF will receive the DSA.

Legal Authority

    By Delegation Order No. 00-037.00B, effective November 19, 2016, 
the Secretary of Energy delegated: (1) The authority to develop power 
and transmission rates to the WAPA Administrator; (2) the authority to 
confirm, approve, and place such rates into effect on an interim basis 
to the

[[Page 61212]]

Deputy Secretary of Energy; and (3) the authority to confirm, approve, 
and place into effect on a final basis, or to remand or disapprove such 
rates, to FERC. By Delegation Order No. S1-DEL-S4-2021, effective 
February 25, 2021, the Acting Secretary of Energy also delegated the 
authority to confirm, approve, and place such rates into effect on an 
interim basis to the Under Secretary for Science (and Energy). By 
Redelegation Order No. S4-DEL-OE1-2021, effective March 25, 2021, the 
Acting Under Secretary for Science (and Energy) redelegated the 
authority to confirm, approve, and place such rates into effect on an 
interim basis to the Assistant Secretary for Electricity. By 
Redelegation Order No. 00-002.10-05, effective July 8, 2020, the 
Assistant Secretary for Electricity further redelegated the authority 
to confirm, approve, and place such rates into effect on an interim 
basis to WAPA's Administrator. This redelegation order, despite 
predating the February 2021 and March 2021 delegations, remains valid. 
This rate action is issued under Redelegation Order No. 00-002.10-05 
and Department of Energy procedures for public participation in rate 
adjustments set forth at 10 CFR part 903.\1\
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    \1\ 50 FR 37835 (Sept. 18, 1985) and 84 FR 5347 (Feb. 21, 2019).
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    Following review of CRSP MC's proposal, I hereby confirm, approve, 
and place Rate Order No. WAPA-199, which provides the fixed rates for 
firm power, into effect on an interim basis. WAPA will submit Rate 
Order No. WAPA-199 to FERC for confirmation and approval on a final 
basis.

Department of Energy

Administrator, Western Area Power Administration

In the Matter of:

    Western Area Power Administration, Colorado River Storage Project 
Management Center, Rate Adjustment for the Salt Lake City Area, 
Integrated Projects Fixed Firm Power Rates

Rate Order No. WAPA-199

Order Confirming, Approving, and Placing the Salt Lake City Area 
Integrated Projects Fixed Firm Power Rates Into Effect on an Interim 
Basis

    The fixed rates in Rate Order No. WAPA-199 are established 
following section 302 of the Department of Energy (DOE) Organization 
Act (42 U.S.C. 7152).\1\
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    \1\ 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 Project Act of 1939 (43 U.S.C. 
485h(c)); and other acts that specifically apply to the project(s) 
involved.
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    By Delegation Order No. 00-037.00B, effective November 19, 2016, 
the Secretary of Energy delegated: (1) The authority to develop power 
and transmission rates to the Western Area Power Administration's 
(WAPA) 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 on a final basis, 
remand, or disapprove such rates to FERC. By Delegation Order No. S1-
DEL-S4-2021, effective February 25, 2021, the Acting Secretary of 
Energy also delegated the authority to confirm, approve, and place such 
rates into effect on an interim basis to the Under Secretary for 
Science (and Energy). By Redelegation Order No. S4-DEL-OE1-2021, 
effective March 25, 2021, the Acting Under Secretary for Science (and 
Energy) redelegated the authority to confirm, approve, and place such 
rates into effect on an interim basis to the Assistant Secretary for 
Electricity. By Redelegation Order No. 00-002.10-05, effective July 8, 
2020, the Assistant Secretary for Electricity further delegated the 
authority to confirm, approve, and place such rates into effect on an 
interim basis to WAPA's Administrator. This redelegation order, despite 
predating the February 2021 and March 2021 delegations remains valid. 
This rate action is issued under Redelegation Order No. 00-002.10-05 
and DOE procedures for public participation in rate adjustments set 
forth at 10 CFR part 903.\1\
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    \1\ 50 FR 37835 (Sept. 18, 1985) and 84 FR 5347 (Feb. 21, 2019).
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Acronyms, Terms, and Definitions

    As used in this Rate Order No. WAPA-199, the following acronyms, 
terms, and definitions apply:
    Basin Fund: Upper Colorado River Basin Fund.
    Capacity: The electric capability of a generator, transformer, 
transmission circuit, or other equipment. It is expressed in kilowatts 
(kW) or megawatts (MW).
    Capacity Rate: The rate which sets forth the charges for capacity. 
It is expressed in dollars per kilowatt-month and applied to each 
kilowatt delivered to each Customer.
    CDP: Customer Displacement Power.
    Composite Rate: The Power Repayment Study (PRS) rate for commercial 
firm power, which is the total annual revenue requirement for capacity 
and energy divided by the total annual energy sales. It is expressed in 
mills per kilowatt-hour and used only for comparison purposes.
    CRC: Cost Recovery Charge.
    CROD: Contract Rate of Delivery. The maximum amount of capacity 
made available to a preference Customer for a period specified under a 
contract.
    Customer: Firm electric service customer(s) contractually receiving 
SLCA/IP power and energy.
    CY: Calendar Year. When used in the CRC it is the 12-month period 
the CRC is in effect.
    DSA: Deliverable Sales Amount--marketable generation level, above 
which WAPA will forgo purchased power.
    Energy Rate: The rate which sets forth the charges for energy. It 
is expressed in mills/kWh and applied to each DSA kWh delivered to each 
Customer.
    Firm: A type of product or service available at the time requested 
by the Customer.
    FY: Fiscal Year, October 1 to September 30.
    GWh: Gigawatt-hour--the electrical unit of energy that equals 1 
billion watthours or 1 million kWh.
    Integrated Projects: The resources and revenue requirements of the 
Collbran, Dolores, Rio Grande, and Seedskadee projects blended with the 
CRSP to create the SLCA/IP resources and rate.
    kW: Kilowatt--the electrical unit of capacity that equals 1,000 
watts.
    kWh: Kilowatt-hour--the electrical unit of energy that equals 1,000 
watts in 1 hour.
    kWmonth: Kilowatt-month--the electrical unit of the monthly amount 
of capacity.
    MAF: Million Acre-Feet. The amount of gallons of water required to 
cover 1 million acres, 1 foot in depth.
    Mill: A monetary denomination of the United States that equals one 
tenth of a cent or one thousandth of a dollar.
    Mills/kWh: Mills per kilowatt-hour--the unit of charge for energy.
    MW: Megawatt--the electrical unit of capacity that equals 1 million 
watts or 1,000 kilowatts.
    MWh: One million watt-hours of electric energy. A unit of 
electrical energy which equals 1 megawatt of power used for 1 hour.
    NEPA: National Environmental Policy Act of 1969, as amended.
    OASIS: Open Access Same-Time Information System--An electronic 
posting system that a service provider maintains for transmission 
access data that allows all Customers to view information 
simultaneously.
    O&M: Operations and Maintenance.
    OM&R: Operations, Maintenance and Replacements.

[[Page 61213]]

    Power: Capacity and energy.
    Project Use: Power used to operate SLCA/IP and CRSP facilities 
under Reclamation Law.
    Provisional Rate: A rate confirmed, approved, and placed into 
effect on an interim basis by the Secretary or his/her designee.
    Rate Brochure: A document prepared for public distribution 
explaining the rationale and background for the information contained 
in this rate order.
    Ratesetting PRS: The Power Repayment Study (PRS) used for the rate 
adjustment period.
    Revenue Requirement: The revenue required to recover O&M expenses, 
purchased power and transmission service expenses, interest, deferred 
expenses, and repayment of Federal investments, or other assigned 
costs.
    SHP: Sustainable Hydropower (long-term SLCA/IP hydro capacity with 
energy).
    SLCA/IP: Salt Lake City Area Integrated Projects.
    WL: Waiver Level.
    Work Plan: An estimate of costs that are expected to become the 
Congressional Budget for WAPA and Reclamation. Also known as a Work 
Program.
    WRF: Western Replacement Firming.
    WRP: Western Replacement Power.

Effective Date

    The Provisional Rate Schedule SLIP-F12 will take effect on the 
first day of the first full billing period beginning on or after 
December 1, 2021, and will remain in effect through December 31, 2023, 
pending approval by FERC on a final basis or until superseded.

Public Notice and Comment

    The CRSP MC followed the Procedures for Public Participation in 
Power and Transmission Rate Adjustments and Extensions, 10 CFR part 
903, in developing these fixed rates. Following are the steps CRSP MC 
took to involve interested parties in the rate process:
    1. On June 28, 2021, a Federal Register notice (86 FR 34002) 
(Proposal FRN) announced the proposed rates and launched the 65-day 
public consultation and comment period. The comment period was reduced 
from the customary 90-day period due to the $20 million financial 
impact of not implementing the rate by December 1, 2021.
    2. On June 28, 2021, CRSP MC notified Customers and interested 
parties of the proposed rates and provided a copy of the published 
Proposal FRN.
    3. On July 7, 2021, CRSP MC held a virtual public information 
forum. CRSP MC representatives explained the proposed fixed rates, 
answered questions, and gave notice that more information was available 
in the Rate Brochure.
    4. On July 28, 2021, CRSP MC held a virtual public information 
forum on purchased power and WRF. CRSP MC representatives explained the 
process used to project purchase power, how WRF will be implemented, 
answered questions, and gave notice that more information would be 
available in a subsequent version of the Rate Brochure and provided 
points of contact for additional questions on WRF implementation.
    5. On July 29, 2021, CRSP MC held a virtual public information 
forum on the CRC. CRSP MC representatives explained the purpose of the 
CRC, the need for changes, how it is calculated and implemented, 
answered questions, and gave notice that more information was available 
in the Rate Brochure.
    6. On August 11, 2021, CRSP MC held a virtual public comment forum. 
This provided Customers and other interested parties an opportunity to 
provide official comments for the record.
    7. On August 13, 2021, CRSP MC posted responses to questions asked 
during the August 11, 2021, virtual public comment forum on the rate 
action website and notified the Customers and interested parties via 
email.
    8. CRSP MC provided a website that contains all dates, Customer 
letters, presentations, FRNs, Rate Brochure, and other information 
about this rate process. The rate action website is located at 
www.wapa.gov/regions/CRSP/rates/Pages/rate-order-199.aspx.
    9. During the 65-day consultation and comment period, which ended 
on August 31, 2021, CRSP MC received 10 oral comments at the August 11, 
2021, virtual public comment forum, and seven comment letters. All 
comments from the virtual public comment forum were addressed by WAPA 
via email and/or responses were posted to the rate action website on 
August 13, 2021. The comments and CRSP MC responses are addressed in 
the Comments section and have been considered in the preparation of 
this Rate Order No. WAPA-199.
    Oral comments were received from the following organizations:

Colorado River Energy Distributors Association (CREDA)
Utah Associated Municipal Power Systems (UAMPS)
Arizona Electric Power Cooperative (AEPCO)

    Written comments were received from the following organizations:

Colorado River Energy Distributors Association (CREDA)
Arizona Electric Power Cooperative (AEPCO)
Municipal Energy Agency of Nebraska (MEAN/NMPP)
Platte River Power Authority (PRPA)
Tri-State Generation and Transmission Association, Inc. (TRI-STATE)
Utah Rural Electric Cooperative Association (URECA)
Utah Municipal Power Agency (UMPA)

    10. CRSP MC received comments on the original Rate Brochure. 
Comments were addressed in subsequent versions of the Rate Brochure.
    11. CRSP MC provided a second consultation and comment period from 
September 22 through October 6, 2021. This comment period facilitated 
Customer feedback in reference to purchased power and generation 
updates. The comments and CRSP MC responses are addressed in the 
Comments section, and all comments have been considered in the 
preparation of this Rate Order No. WAPA-199.
    Written comments were received from the following organizations:

Colorado River Energy Distributors Association (CREDA)
Platte River Power Authority (PRPA)

Power Repayment Study--Firm Power Service Rate Discussion

    CRSP MC prepares PRSs each FY to determine if revenues will be 
sufficient to repay, within the required time, all costs assigned to 
the SLCA/IP. Repayment criteria are based on applicable laws and 
legislation, as well as policies including DOE Order RA 6120.2. To meet 
the cost recovery criteria outlined in DOE Order RA 6120.2, a revised 
PRS and rate adjustment have been developed to demonstrate that 
sufficient revenues will be collected under the Provisional Rate to 
meet future obligations. The revenue requirement and composite rate for 
SLCA/IP firm power service are being increased, as indicated in Table 
1:

[[Page 61214]]



                         Table 1--Comparison of Revenue Requirements and Composite Rates
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                                                                               Provisional
              Firm power service                 Existing requirements    requirements (December  Percent change
                                                   (October 1, 2020)             1, 2021)
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Revenue Requirement (million $)...............                 $173.511                 $181,197            +4.4
Composite Rate (mills/kWh)....................                    27.45                    30.51           +11.1
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    Under the existing rate methodology, rates for firm power service 
are designed to recover an annual revenue requirement that includes 
power investment repayment, aid to irrigation repayment, interest, O&M, 
replacements, and other expenses within the allowable period.

Firm Power Service--Existing and Provisional Rates

    CRSP MC is implementing this rate action primarily in response to a 
large increase in purchased power costs due to worsening drought 
conditions in the southwestern United States and an increase to OM&R 
expenses.
    CRSP MC is basing sales in the rate on forecasted generation in 
Reclamation's August 2021 24-month Study for the effective period of 
the rate and is subsequently forgoing purchased power in the 
Ratesetting PRS. Forgoing purchased power mitigates the projected rate 
increase from 50-percent down to 11-percent. CRSP MC will not 
automatically purchase firming power to SHP levels. For those Customers 
who elect, CRSP MC will purchase WRF power as a pass-through cost, at 
market rates, up to SHP levels. CRSP MC will purchase power to firm to 
the forecasted generation level, referred to as the DSA. The DSA will 
be updated quarterly as shown in Table 2. Customers will have at least 
14 days to affirmatively select WRF for each quarter. Quarterly notices 
provide flexibility in responding to changes in hydrology and will not 
impact the rates. Customers can elect the full quarter or specific 
months within the quarter.

               Table 2--Quarterly DSA Adjustment Schedule
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                                    Reclamation 24-    Notify customers
        Quarter impacted              month study             by:
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December 2021...................  August 2021.......  mid-October 2021.
January-March 2022..............  November 2021.....  Est: November 20,
                                                       2021.
April-June 2022.................  February 2022.....  Est: February 20,
                                                       2022.
July-September 2022.............  May 2022..........  Est: May 20, 2022.
October-December 2022...........  August 2022.......  Est: August 20,
                                                       2022.
January-March 2023..............  November 2022.....  Est: November 20,
                                                       2022.
April-June 2023.................  February 2023.....  Est: February 20,
                                                       2023.
July-September 2023.............  May 2023..........  Est: May 20, 2023.
October-December 2023...........  August 2023.......  Est: August 20,
                                                       2023.
------------------------------------------------------------------------

    CRSP MC provided information on the implementation process of the 
WRF and DSA in the Rate Brochure, at the virtual public information 
forum, at a virtual purchased power forum, and replied to questions 
from the virtual public comment forum via email. This information was 
published on the rate action website at: www.wapa.gov/regions/CRSP/rates/Pages/rates.aspx.
    A comparison of the existing and provisional rates for firm power 
service is listed in Table 3. The Provisional Rate is a fixed rate that 
will go into effect December 1, 2021, and remain in effect through 
December 31, 2023, or until WAPA supersedes or changes the rates 
through another public rate process pursuant to 10 CFR part 903, 
whichever occurs first.

                              Table 3--Comparison of Existing and Provisional Rate
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                                                       Existing charges       Provisional
                                                          under rate      charges under rate
                 Firm power service                    schedule SLIP-F11   schedule SLIP-F12    Percent change
                                                       as of  October 1,   as of December 1,
                                                             2020                2021
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Firm Energy Rate (mills/kWh)........................               11.43               12.36                +8.1
Firm Capacity Rate ($/kWmonth)......................                4.85                5.25                +8.3
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Statement of Revenue and Related Expenses

    Table 4 provides a comparison of the average annual expense data 
for the firm power service revenue requirement through the rate-setting 
period. The purchase power shown in the table reflects purchase power 
costs for October and November 2021 that fall under the SLIP F11 rates. 
There is no projected purchase power amount included in the rate for 
service from December 2021 through December 2026.

                   Table 4--Annual Revenue Requirements and Firm Power Rates Comparison Table
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                                                              Existing rate   Provisional rate     Difference
                                                                 ($000)            ($000)            ($000)
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Rate Setting Period.......................................         2021-2038         2022-2045
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[[Page 61215]]

 
Revenue Distribution:
    Expenses:
        O&M...............................................           $97,352          $103,095            $5,743
        Purchase Power....................................             1,119               833             (286)
        Transmission......................................             8,998             8,984              (14)
        Integrated Projects requirements..................             6,485             7,043               558
        Interest..........................................             6,066             6,207               141
        Other.............................................            17,909            13,547           (4,362)
                                                           -----------------------------------------------------
            Total Expenses................................           137,928           139,709             1,781
                                                           -----------------------------------------------------
    Principal Payments:
        Capitalized Expenses (deficits)...................                 0               838               838
        Replacements......................................            26,918            29,581             2,663
        Original Project and Additions....................             2,484             1,846             (638)
        Irrigation........................................             6,181             9,223             3,042
                                                           -----------------------------------------------------
            Total Principal Payments......................            35,583            41,488             5,905
                                                           -----------------------------------------------------
            Annual Revenue Requirement....................           173,511           181,197             7,686
----------------------------------------------------------------------------------------------------------------

    The rates would provide sufficient revenue to recover annual O&M 
expenses, replacement expenses, interest expense, irrigation 
assistance, and capital repayment requirements within the cost recovery 
criteria set forth in Department of Energy (DOE) Order No. RA 6120.2.
    Purchased power required to supplement hydropower deliveries up to 
contractual levels will be passed through to Customers under a separate 
charge, WRF, which would be in addition to the rate for hydropower 
deliveries. Any Customer not receiving WRF will not be charged the 
purchased power charge and would receive its proportionate amount of 
the DSA capacity and energy from WAPA each month.

SLCA/IP Firm Power Rate

    The revenue requirement for Rate Schedule SLIP-F12 is based on 
current data available, specifically the FY 2020 historical financial 
data, FY 2022 Work Plan for WAPA, FY 2023 Work Plan for Reclamation, 
and Reclamation's August 2021 24-Month Study (24-month Study) and 
Colorado River Simulation System (CRSS) traces.
    Under rate schedule SLIP-F12, WAPA will use the Reclamation August 
2021 24-Month Study to determine generation and projected sales for the 
2 rate years (FYs 22-23) and CRSS for FYs 24-26 of the rate-setting 
period. Additionally, the rate schedule includes actions WAPA will take 
should Lake Powell's water level drop below the level at which power 
can be generated.

Cost Recovery Charge

    WAPA will retain the CRC as a mechanism to use, if necessary, to 
adequately recover and maintain a sufficient balance in the Basin Fund 
in the event projected expenses significantly exceed projected revenue 
estimates. The Basin Fund is a revolving fund that operates using CRSP 
MC power revenues without annual appropriations. The CRC is an 
additional surcharge on all long-term energy sales provided under the 
WAPA SLCA/IP firm electric service contracts. The CRC may be 
implemented when, among other things, the Basin Fund cash balance is at 
risk due to low hydropower generation, high prices for firming power, 
or emergency capitalized investment funding. The CRC is independent of 
the SLCA/IP PRS calculations.
    WAPA reserves the right to implement a CRC at any point throughout 
the year using guidance from the existing implementation criteria in 
Table 5 and the latest 24-month Study from Reclamation. An established 
CRC would be in effect for 12 months from the date implemented. If 
circumstances dictate the need to reassess an established CRC, the 
updated CRC will supersede the previous CRC and remain in effect for 12 
months. The CRC is implemented at WAPA's discretion based on the 
balance of the Basin Fund and WAPA's ability to meet contractual 
requirements. The minimum Basin Fund carryover balance is $40 million.

                                        Table 5--CRC Implementation Tiers
----------------------------------------------------------------------------------------------------------------
                       Criteria, if the basin fund beginning balance
        Tier                                is:                                      Notification
----------------------------------------------------------------------------------------------------------------
i...................  Greater than $150 million with an expected      Annually (July).
                       decrease to below $75 million.
ii..................  Less than $150 million but greater than $120
                       million with an expected 50-percent decrease
                       in the next CY.
iii.................  Less than $120 million but greater than $90
                       million with an expected 40-percent decrease
                       in the next CY.
iv..................  Less than $90 million but greater than $60      Semi-Annual (July/January).
                       million with an expected 25-percent decrease
                       in the next CY.
v...................  Less than $60 million but greater than $40      Monthly.
                       million with an expected decrease to below
                       $40 million in the next CY.
----------------------------------------------------------------------------------------------------------------


[[Page 61216]]

    WAPA reserves the right to implement a CRC throughout the year if 
annual water releases from Glen Canyon Dam fall below 8.23 MAF, 
regardless of the Basin Fund balance.
    If a CRC is implemented, CRSP MC will establish an energy Waiver 
Level (WL) using the CRC formula. Customers could accept either the CRC 
or WL. The WL provides WAPA the ability to reduce purchase power 
expenses by delivering less energy than its contractual obligations. 
For those Customers who agree to schedule no more energy than their 
proportionate share of the WL, WAPA would waive the CRC for that year.
    If, in any month, the annual water release volumes from Glen Canyon 
Dam return to 8.23 MAF or higher while a CRC is in place, a new CRC 
will be calculated for the next month, and each Customer will be 
notified of the recalculated CRC results.
    CRC sample calculations, narratives, and schedules are located on 
the CRC web page: www.wapa.gov/regions/CRSP/rates/Pages/cost-recovery-charge.aspx.

Comments

    CRSP MC received 52 oral or written comments during the public 
consultation and comment period. The comments expressed have been 
paraphrased or consolidated, where appropriate, without compromising 
the meaning of the comments.

Comments on Firm Power Rates

    A. Comment: Commentor urged WAPA to continue to refine elements 
other than purchased power in the PRS to result in the lowest possible 
rate, consistent with sound business principles.
    Response: CRSP MC analyzed data including O&M work plans, 10-year 
plans for capital investment, and Customer agreements, as well as 
Customer input, to ensure rates are the lowest possible consistent with 
sound business principles.
    B. Comment: Commentor requested that WAPA continue to reflect 
``expense reductions to the work plans as they become available,'' 
until the latest possible date, as those work plan-related discussions 
are still underway.
    Response: CRSP MC incorporated changes to the Reclamation and WAPA 
work plan reviews into the power repayment study as the information was 
made available including using WAPA's FY 22 Work Plan instead of the FY 
23 Work Plan. CRSP MC updated supporting data documents and posted them 
to the rate action website and included the results in the Rate 
Brochure updates.
    C. Comment: Multiple commentors asked about the availability of 
firm transmission for Customers who do not elect WRF and what CRSP MC 
will do with surplus transmission.
    Response: The CROD capacity will not be reduced. Available capacity 
up to the CROD is available for Customer use as WRP and CDP as provided 
in the Customers' SLCA/IP firm electric service contracts. Surplus 
transmission, if any, would be made available through the OASIS based 
on existing policy and procedures.
    D. Comment: Commentor expressed concerns over ``rate shock'' for 
small Customers and stated the rate process provides very little time 
for Customers to design and implement retail rate adjustments that 
account for these changes. Commentor believes WAPA must consider this 
rate shock and what (if any) new value WAPA can provide to help offset 
this significant increase.
    Response: CRSP MC understands that increasing rates impacts its 
Customers. CRSP MC operates on a cost-basis and must establish rates to 
collect sufficient revenue to meet operational expense and repayment 
obligations. Significant increases in purchase power costs warrant the 
need for the rate action. CRSP MC followed public notice requirements 
of the Administrative Procedure Act in setting forth this proposed rate 
change. CRSP MC implemented this short rate period so collaborative 
conversations with interested parties could occur over the next 2 years 
on the most effective use of available generation and long-term 
strategies for managing the cost of purchased power.

Comments on Services

    A. Comment: Commentor believes WAPA's Customers must have the 
ability to convert some of their allocation into ancillary services to 
offset the financial impacts of the rate increase.
    Response: All available energy is committed to firm power service 
deliveries.
    B. Comment: One commentor asked WAPA to clarify whether the firm 
capacity and energy will be restored to Customers in the event the 
Colorado River Basin's hydrological conditions revert to historical 
levels.
    Response: Should forecasted hydrological conditions improve, the 
DSA levels will rise providing additional energy allocations for 
Customers. AHP as defined in the SLCA/IP firm electric service contract 
will also be offered if hydrological conditions improve significantly 
within an established quarter.
    C. Comment: One commentor does not agree with WAPA's position that 
the ``Tribe under the benefit crediting contract would need to decide 
whether to receive WRF and communicate that decision to its benefit 
crediting utility.'' Commentor's position is the election of WRF should 
be that of the benefit crediting utility, not the Tribe.
    Response: CRSP MC has clarified this issue. WRF may be selected by 
the utility providing the benefit crediting service. This is like the 
existing treatment under the WRP program. The benefit crediting amount 
provided to a Tribe is to be calculated on the Tribe's hydropower 
delivery amounts.
    D. Comment: Commentor asked that WAPA ensure participants retain 
the option to independently purchase replacement power to cover 
shortfalls in CRSP production. The proposed opt-in process should be, 
at most, seasonal (every 6 months) to prevent adverse selection issues 
or last-minute decisions by individual members that change market 
conditions for all project participants.
    Response: Customers can independently use their own resources or 
purchase their own firming power under the CDP program. To provide 
greater flexibility in responding to hydrology, CRSP MC has enhanced 
the DSA and WRF programs by using quarterly notices to the Customers. 
Although 6-month periods were originally proposed, Customers requested 
additional flexibility in determining which months to potentially 
purchase WRF. Quarterly notices will provide Customers additional 
flexibility in meeting their resource needs and provide CRSP MC more 
certainty about water releases and hydropower generation availability.
    E. Comment: Commentor asked that WAPA protect preference Customers' 
firm transmission rights, so Customers can use their transmission 
rights for power delivered to make up for power WAPA cannot provide. 
Commentor asked that WAPA maintain the current practice for firm 
transmission for power delivered in lieu of WAPA power, which was 
implemented earlier in this ongoing drought.
    Response: Available capacity up to the CROD is still available for 
Customer use as WRP and CDP.

Comments in Support

    A. Comment: Multiple commentors provided favorable comments 
thanking WAPA for its willingness to collaborate through rate, 
resource, and work plan processes; inclusion of two topical

[[Page 61217]]

virtual public forums to assist in Customer review and understanding of 
the WAPA-199 rate; appreciation for WAPA's Customer notification of 
materials being posted on the rate website; appreciation for WAPA's 
willingness to work with them to improve the capability and 
accessibility of the modeling tools used to analyze and produce CRSP 
rate scenarios in a timely manner; appreciation for WAPA's flexibility 
in providing a 14-day consultation and comment period after ``final 
purchased power amounts'' have been posted to its website; appreciation 
towards WAPA, CRSP staff, and Reclamation's work with Customers during 
this rate process and through the process referred to as the ``work 
program review'' process.
    Response: CRSP MC appreciates the feedback and recognizes the 
benefits of collaborating with Customers and interested parties.
    B. Comment: Two commentors expressed appreciation for CRSP MC's and 
Upper Colorado Region of Reclamation's approach to mitigating drought 
impacts and ensuring that the Basin Fund remains viable through the new 
rate components and continuation of the WRP and CDP processes, as well 
as the PRS and rates.
    Response: CRSP MC appreciates the feedback.
    C. Comment: Commentor expressed support for the revisions made to 
the CRC described in the Rate Brochure.
    Response: CRSP MC appreciates the feedback on the CRC revisions.

Comments on Customer Communications

    A. Comment: Two commentors requested WAPA continue timely 
communication, collaboration, and transparency with CRSP Customers on 
decisions, ongoing concerns, and potential impacts of recent Senate 
infrastructure funding.
    Response: While the Senate infrastructure funding is out of scope 
for this rate action, CRSP MC understands the benefits of 
communication, collaboration, and transparency with its Customers in 
addressing potential rate impacts.
    B. Comment: One commentor requested WAPA incorporate information/
adjustments from pending Reclamation and WAPA reviews into the final 
proposed/provisional rate, and the results of that inclusion be 
provided to them.
    Response: CRSP MC incorporated changes tied to the Reclamation and 
WAPA work plan reviews into the PRS as the information was made 
available. CRSP MC updated supporting data documents, posted them to 
the rate action website, and included the results in the Rate Brochure 
updates.
    C. Comment: One commentor requested WAPA ensure Customers are 
notified of the Provisional Rate under this rate order prior to the 
issuance of Customer Notification of the DSA Season Update for Winter 
2022 Season.
    Response: CRSP MC provided the projected final rate on September 
22, 2021, when it opened the Customer Comment Period on Purchased Power 
and Generation. The rate was subsequently decreased based on changes to 
project use power and CRSP MC's decision to use the FY 2022 work plan 
for the rate-setting period to reduce costs.
    D. Comment: Commenter requested their most recent correspondence be 
included in the WAPA-199 record.
    Response: CRSP MC filed all received comments in the decision of 
record for this rate process.
    E. Comment: One commentor asked WAPA to continue its practice of 
collaboration and transparency for future decisions that affect CRSP 
Customers, such as costs for shaping and firming services as additional 
power is needed to maintain reliable supply.
    Response: CRSP MC will continue its practice of collaboration and 
transparency.

Comments on Other

    A. Comment: Commentor expressed recognition of the significance of 
the current drought conditions in the Colorado River Basin and the 
challenges that are being presented to WAPA and the CRSP Customers.
    Response: CRSP MC appreciates the feedback.
    B. Comment: One commentor expressed appreciation that the current 
scope of this rate order does not propose changes to ancillary 
services. Commentor wants any future changes to ancillary services to 
be part of a separate rulemaking.
    Response: The current transmission and ancillary service formula 
rates established under Rate Order WAPA-190 required no modifications 
and continue to be effective under Rate Order WAPA-190 through 
September 30, 2025.

Second Comment Period Comments

    A. Comment: Commenters expressed that it does not make sense to 
apply the CRC to all SHP and DSA because DSA is a subset of SHP.
    Response: CRSP MC concurs. Since CRSP MC is only purchasing firming 
power to the DSA level, instances of SHP in the CRC will be replaced 
with DSA in the FRN and supporting documentation.
    B. Comment: Commenters expressed that the CRC does not belong in 
the WRF cost recovery equation.
    Response: CRSP MC concurs that WRF is exempt from the CRC 
calculation. The CRC only applies to the firming purchases up to the 
DSA level.
    C. Comment: Commenter said, ``Because any portion of a customer's 
SHP above DSA will necessarily be WRF, the CRC should not apply to the 
above-DSA amount.''
    Response: CRSP MC concurs that the CRC only applies to firming 
purchases up to the DSA level and made conforming changes within the 
FRN and supporting documentation.
    D. Comment: Commenter thanks WAPA for the additional comment period 
to respond to updated elements of its CRSP rate proposal, and for its 
continuing commitment to transparency and collaboration in the rate-
setting process.
    Response: WAPA appreciates the feedback.
    E. Comment: Commenter supports WAPA making ``additional changes to 
the work plan'' . . . and including them in the final rate package 
without ``an additional comment period for Customer review.''
    Response: The WAPA decision not to initiate an additional comment 
period was due to the changes decreasing the proposed rate. Had the 
recent update to the workplan increased the proposed rate, WAPA would 
have considered an additional comment period or delayed implementation 
of the change until the next rate action.
    F. Comment: Commenter supports the change in the DSA and WRF to 
quarterly time frames, and the addition that Customers may elect 
specific months within the quarter, to receive WRF.
    Response: CRSP MC appreciates the feedback.
    G. Comment: Commenter urges ongoing customer collaboration to 
address hydrologic conditions and forecasts, Basin Fund targets 
(including any methodology changes which may be made), MOA transfer 
timing, non-power program and non-reimbursable funding and 
Congressional action.
    Response: CRSP MC recognizes the benefits of customer collaboration 
in dealing with the drought and impacts on generation and the energy 
rates. CRSP MC will continue its practice of transparency by providing 
information as it becomes available.
    H. Comment: Commenter supports the collaborative effort WAPA has 
made

[[Page 61218]]

with Customers to develop long-term solutions to manage revenue 
requirements and cash flow.
    Response: WAPA appreciates the feedback and recognizes the benefits 
of customer collaboration.

Certification of Rates

    I have certified that the Provisional Rates for SLCA/IP Firm Power 
under Rate Schedule SLIP-F12 are the lowest possible rates, consistent 
with sound business principles. The Provisional Rates were developed 
following administrative policies and applicable laws.

Availability of Information

    Information about this rate adjustment, including the Rate 
Brochure, PRSs, comments, letters, memoranda, and other supporting 
materials that were used to develop the Provisional Rates, is available 
for inspection and copying at the Colorado River Storage Project 
Management Center Office, 1800 South Rio Grande Avenue, Montrose, CO. 
Many of these documents are also available on WAPA's website at 
www.wapa.gov/regions/CRSP/rates/Pages/rates.aspx, or email; [email protected].

Ratemaking Procedure Requirements

Environmental Compliance

    WAPA has determined this action fits within the following 
categorical exclusions listed in appendix B to subpart D of 10 CFR part 
1021.410: B4.3 (Electric power marketing rate changes) and B4.4 (Power 
marketing services and activities). Categorically excluded projects and 
activities do not require preparation of either an environmental impact 
statement or an environmental assessment.\1\ Specifically, WAPA has 
determined that this rulemaking is consistent with activities 
identified in B4, Categorical Exclusions Applicable to Specific Agency 
Actions (see 10 CFR part 1021, appendix B to subpart D, part B4). A 
copy of the categorical exclusion determination is available on WAPA's 
website at: www.wapa.gov/regions/CRSP/environment/Pages/environment.aspx.
---------------------------------------------------------------------------

    \1\ The determination was done in compliance with NEPA (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).
---------------------------------------------------------------------------

Determination Under Executive Order 12866

    WAPA 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.

Submission to the Federal Energy Regulatory Commission

    The Provisional Rate herein confirmed, approved, and placed into 
effect on an interim basis, together with supporting documents, will be 
submitted to FERC for confirmation and final approval.

Order

    In view of the above, and under the authority delegated to me, I 
hereby confirm, approve, and place into effect, on an interim basis, 
Rate Order No. WAPA-199. The rates will remain in effect on an interim 
basis until: (1) FERC confirms and approves them on a final basis; (2) 
subsequent rates are confirmed and approved; or (3) such rates are 
superseded.

Signing Authority

    This document of the Department of Energy was signed on October 28, 
2021, by Tracey LeBeau, Administrator, Western Area Power 
Administration, pursuant to delegated authority from the Secretary of 
Energy. That document, with the original signature and date, is 
maintained by DOE. For administrative purposes only, and in compliance 
with requirements of the Office of the Federal Register, the 
undersigned DOE Federal Register Liaison Officer has been authorized to 
sign and submit the document in electronic format for publication, as 
an official document of the Department of Energy. This administrative 
process in no way alters the legal effect of this document upon 
publication in the Federal Register.

     Signed in Washington, DC, on November 2, 2021.
Treena V. Garrett
Federal Register Liaison Officer, U.S. Department of Energy.
Rate Schedule SLIP-F12
(Supersedes Rate Schedule SLIP-F11)

United States Department of Energy

Western Area Power Administration

Colorado River Storage Project Management Center Salt Lake City Area 
Integrated Projects

Schedule of Rates for Firm Power Service (Approved Under Rate Order No. 
WAPA-199)

    Effective: The first day of the first full billing period beginning 
on or after December 1, 2021, and extending through December 31, 2023, 
or until superseded by another rate schedule, whichever occurs earlier.
    Available: In the area served by the Salt Lake City Area Integrated 
Projects.
    Applicable: To the wholesale power Customer for firm power service 
supplied through one meter at one point of delivery or as otherwise 
established by contract.
    Character: Alternating current, 60 hertz, three-phase, delivered 
and metered at the voltages and points established by contract.
    Monthly Rate: Demand Charge: $5.25 per kilowatt of billing demand.
    Energy Charge: $12.36 mills per kilowatthour of use of Deliverable 
Sales Amount (DSA) energy.
    Modification of Purchased Power: WAPA will not automatically 
provide purchased power to firm to SHP energy allocations, nor will 
there be any purchased power costs under Rate Order WAPA-199 in the 
rate setting period in the power repayment study under Rate Order WAPA-
199. WAPA will establish the rates using the projected DSA data in the 
Bureau of Reclamation's (Reclamation) August 2021 24-month Study and 
Reclamation's August 2021 Colorado River Simulation System traces.
    Western Replacement Firming (WRF): WRF applies to pass-through 
purchased power costs for energy provided between the DSA level and SHP 
energy allocation. WRF is an optional product. Customers must elect 
quarterly, and may elect specific months within the quarter, to receive 
WRF. The charge for this purchased power will be determined at the time 
of the purchase based on market rates. There are no losses or an 
administrative fee charged to WRF. A schedule for the quarterly updates 
is in the rate brochure on the rate action website: www.wapa.gov/regions/CRSP/rates/Pages/rates.aspx.
    Billing Demand: The billing demand will be the greater of:
    1. The highest 30-minute integrated demand measured during the 
month up to, but not more than, the delivery obligation under the power 
sales contract, or,
    2. The Contract Rate of Delivery.
    Billing Energy: The billing energy will be the energy measured 
during the month up to, but not more than, the delivery obligation 
under the power sales contract.
    Adjustment for Transformer Losses: If delivery is made at 
transmission voltage but metered on the low-voltage side of the 
substation, the meter readings will be increased to compensate for 
transformer losses as provided in the contract.
    Adjustment for Power Factor: The Customer will be required to 
maintain a power factor at all points of

[[Page 61219]]

measurement between 95 percent lagging and 95 percent leading.
    Adjustment for Western Replacement Power (WRP): Pursuant to the 
Customer's Firm Electric Service Contract, as amended, WAPA will bill 
the Customer for its proportionate share of the costs of WRP within a 
given time. WAPA will include in the monthly power bill the cost of the 
WRP, and the incremental administrative costs associated with WRP.
    Adjustment for Customer Displacement Power (CDP) Administrative 
Charges: WAPA will include in the Customer's regular monthly power bill 
the incremental administrative costs associated with CDP.
    Adjustment for Minimum Power Pool: If Lake Powell drops below 
``minimum power pool'' and power cannot be generated, WAPA will provide 
30 days' notice to the Customers prior to reducing the DSA.
    Cost Recovery Charge (CRC): To adequately recover and maintain a 
sufficient balance in the Basin Fund, WAPA uses a cost recovery 
mechanism, called a CRC. The CRC is a charge on all long-term energy 
sales provided under WAPA's SLCA/IP firm electric service contracts.
    This charge will be, at a minimum, recalculated before July 1 of 
each year, and WAPA will provide notification to the Customers 
consistent with the procedures in 10 CFR 903. WAPA has the discretion 
to implement the CRC at any point throughout the year using the 
criteria in Table 1. The charge, if needed, will be placed into effect 
on the first day of the first full-billing period beginning on or after 
the first day of the month the CRC is implemented. For the purposes of 
the CRC, the 12-month period of a CRC will be described as a calendar 
year (CY). The CRC will be calculated as follows:

                                               Table 1--CRC Tiers
----------------------------------------------------------------------------------------------------------------
                                         Criteria, if the basin fund beginning balance
                 Tier                                     (BFBB) is:                           Notification
----------------------------------------------------------------------------------------------------------------
i....................................  Greater than $150 million, with an expected       Annually (July).
                                        decrease to below $75 million.
ii...................................  Less than $150 million but greater than $120
                                        million, with an expected 50 percent decrease
                                        in the next CY.
iii..................................  Less than $120 million but greater than $90
                                        million, with an expected 40 percent decrease
                                        in the next CY.
iv...................................  Less than $90 million but greater than $60        Semi-Annual (July/
                                        million, with an expected 25 percent decrease     January).
                                        in the next CY.
v....................................  Less than $60 million but greater than $40        Monthly.
                                        million with an expected decrease to below $40
                                        million in the next CY.
----------------------------------------------------------------------------------------------------------------

    CRC sample calculations, narratives, and schedules showing the 
dates for implementing a CRC throughout the year are located at the CRC 
web page: www.wapa.gov/regions/CRSP/rates/Pages/cost-recovery-charge.aspx.
Waiver Level (WL)
    WAPA will establish a WL that provides WAPA the ability to reduce 
purchased power expenses by scheduling less energy than what is 
contractually required. Therefore, for those Customers who voluntarily 
schedule no more energy than their proportionate share of the WL, WAPA 
will waive the CRC for that year. After the Funds Available have been 
determined, the WL will be set at the sum of the energy that can be 
provided through hydro generation and purchased with Funds Available. 
The WL will not be less than the forecasted Hydro Energy.
    Trigger for Water Release Criteria: In the event that Reclamation's 
24-month study projects Glen Canyon Dam water releases will drop below 
8.23 million acre feet (MAF) in a water year (October through 
September), WAPA will recalculate the CRC to include those lower 
estimates of hydropower generation. WAPA, as in the yearly projection 
for the CRC, will give the Customers a 45-day notice to request a 
waiver of the CRC if they do not want to have the CRC charge added to 
their energy bills. This recalculation will remain in effect for the 
remainder of the CY.
    If the annual water release volumes from Glen Canyon Dam return to 
8.23 MAF or higher during the trigger implementation, a new CRC will be 
calculated for the next month, and the Customer will be notified.
Trigger for New Rate Criteria
    WAPA would reassess an implemented CRC when a new rate goes into 
effect to determine if the implemented CRC should be continued, 
superseded, or terminated.
    Prior Year Adjustment for CRC: Since the annual determination of 
the CRC is based upon estimates, an annual, prior-year adjustment (PYA) 
will be calculated for those who did not elect the waiver level. The 
PYA will be based on the 12-month period the CRC was in effect.
    The Customers' PYA will be based on their prior 12-months' energy 
multiplied by the PYA mills/kWh to determine the dollar value that will 
be assessed. The Customer will be charged or credited for this dollar 
amount equally in the remaining months of the next 12-month billing 
cycle. WAPA will complete this calculation within 2 months of the end 
of the CRC. Therefore, if the PYA is calculated in June, the charge/
credit will be spread over the remaining 9 months of the CY (July 
through March).
    Adjustment for CRC Waiver: Customers can choose not to take the 
full DSA energy supplied as determined in the attached formulas for CRC 
and will be billed the Energy and Capacity rates listed above, but not 
the CRC.

[FR Doc. 2021-24217 Filed 11-4-21; 8:45 am]
BILLING CODE 6450-01-P