[Federal Register Volume 89, Number 169 (Friday, August 30, 2024)]
[Notices]
[Pages 70629-70631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-19562]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Boulder Canyon Project

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice concerning fiscal year 2025 base charge and rates for 
electric service.

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SUMMARY: The Deputy Secretary confirms, approves, and places into 
effect on a final basis the Western Area Power Administration (WAPA) 
Desert Southwest Region's (DSW) fiscal year (FY) 2025 base charge and 
rates for Boulder Canyon Project (BCP) electric service under Rate 
Schedule BCP-F11. The FY 2025 base charge is unchanged from FY 2024 and 
will remain at $74.3 million.

DATES: The FY 2025 base charge and rates are effective October 1, 2024, 
and will remain in effect through September 30, 2025.

FOR FURTHER INFORMATION CONTACT: Jack D. Murray, Regional Manager, 
Desert Southwest Region, Western Area Power Administration, P.O. Box 
6457, Phoenix, AZ 85005-6457, or Tina Ramsey, Rates Manager, Desert 
Southwest Region, Western Area Power

[[Page 70630]]

Administration, (602) 605-2565, or email: [email protected].

SUPPLEMENTARY INFORMATION: On March 31, 2023, the Federal Energy 
Regulatory Commission (FERC) approved and confirmed Rate Schedule BCP-
F11, under Rate Order No. WAPA-204, on a final basis through September 
30, 2027.\1\ WAPA published a Federal Register notice (Proposed FRN) on 
April 19, 2024 (89 FR 28767), proposing the FY 2025 base charge and 
rates under Rate Schedule BCP-F11. The Proposed FRN also initiated a 
90-day public consultation and comment period and set forth the date 
and location of the public information and public comment forums.
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    \1\ Order Confirming and Approving Rate Schedule on a Final 
Basis, FERC Docket No. EF22-4-000.
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    The rate-setting methodology for BCP electric service requires 
calculation of an annual base charge rather than a unit rate for Hoover 
Dam hydropower. The base charge recovers an annual revenue requirement 
that includes projected costs of investment repayment, interest, 
operations, maintenance, replacements, payments to states, and Hoover 
Dam visitor services. Non-power revenue projections such as water 
sales, Hoover Dam visitor revenue, ancillary services, and late fees 
help offset these projected costs. Hoover power contractors are billed 
a percentage of the base charge in proportion to their power 
allocation. Unit rates are calculated for comparative purposes but are 
not used to determine the charges for electric service.
    Rate Schedule BCP-F11 and the BCP Electric Service Contract require 
WAPA to calculate the annual base charge and rates for the next fiscal 
year before October 1 of each year. The FY 2024 BCP base charge and 
rates expire on September 30, 2024.

                                       Comparison of Base Charge and Rates
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                                                 FY 2024            FY 2025        Amount change  Percent change
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Base Charge ($)...........................         74,334,285         74,334,285            0.00             0.0
Composite Rate (mills/kWh)................              23.10              24.39            1.29             5.6
Energy Rate (mills/kWh)...................              11.55              12.20            0.65             5.6
Capacity Rate ($/kW-Mo)...................               2.15               2.17            0.02             0.9
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    The FY 2025 base charge for BCP electric service is unchanged and 
will remain at $74.3 million, the same as FY 2024.
    The Bureau of Reclamation's (Reclamation) FY 2025 budget is 
decreasing $700,000 from $87.9 million to $87.2 million, a 0.8 percent 
decrease from FY 2024. Reflected in this budget, operation and 
maintenance (O&M) costs are increasing $1.1 million primarily due to 
higher projected labor costs for salaries, benefits, and overhead. 
Several large projects are being delayed, decreasing replacements costs 
by $2.2 million. Post-retirement benefit costs are increasing $109,000 
based on a higher five-year average of recent actual expenses. Visitor 
services costs are increasing by $270,000 primarily due to higher 
projected labor costs for salaries, benefits, overhead, and overtime. 
The FY 2024 budget amounts cited for Reclamation do not include 
approximately $20.8 million in costs that are funded by prior year 
carryover from FY 2023.
    WAPA's FY 2025 budget is increasing approximately $600,000 from 
$9.6 million to $10.1 million, a 5.9 percent increase from FY 2024. 
WAPA's O&M costs are increasing $770,000 from FY 2024 due to higher 
projected labor costs for salaries, benefits, overhead, and overtime. 
The increase in O&M costs is offset by a $208,000 decrease in 
replacement costs and modest decreases in WAPA's post-retirement 
benefit costs and interest expenses due to lower five-year averages of 
recent actual expenses. The FY 2024 budget amounts for WAPA do not 
include approximately $282,000 in costs that are funded by prior year 
carryover from FY 2023.
    Non-power revenue projections for Reclamation and WAPA are 
decreasing $2.1 million due to lower estimated revenue for the 
Commercial Use Fee program and ancillary services. Prior year carryover 
is projected to be $4.1 million, a $1.9 million increase from FY 2024.
    The composite and energy rates are both increasing 5.6 percent and 
the capacity rate is increasing 0.9 percent from FY 2024. These unit 
rate calculations use forecasted energy and capacity values, which have 
been decreasing due to the ongoing drought in the Lower Colorado River 
Basin.

Public Notice and Comment

    DSW followed the Procedures for Public Participation in Power and 
Transmission Rate Adjustments and Extensions (10 CFR part 903) and 
General Regulations for the Charges for the Sale of Power from the BCP 
(10 CFR part 904). DSW took the following steps to involve interested 
parties in the rate process:
    1. DSW provided a website where information is posted about this 
rate process. The website is located at https://www.wapa.gov/about-wapa/regions/dsw/rates/boulder-canyon-project-rates/.
    2. On April 19, 2024, a Federal Register notice (89 FR 28767) 
(Proposed FRN) announced the proposed FY 2025 base charge and rates and 
initiated a 90-day public consultation and comment period.
    3. On April 19, 2024, DSW notified contractors and interested 
parties of the proposed rates and provided a copy of the published 
Proposed FRN by email.
    4. On May 20, 2024, DSW held a public information forum, with 
options to attend virtually or in person, at the Desert Southwest 
Regional Office, Phoenix, Arizona. DSW representatives explained the 
proposed base charge and provided contractors and interested parties an 
opportunity to ask questions and provide comments for the record.
    5. On June 20, 2024, DSW held a public comment forum, with options 
to attend virtually or in person, at the Desert Southwest Regional 
Office, Phoenix, Arizona, to provide an opportunity for contractors and 
other interested parties to provide comments for the record.
    6. On July 18, 2024, the public consultation and comment period 
ended with DSW receiving no comments.

Certification of Rates

    WAPA's Administrator certified the FY 2025 base charge and rates 
under Rate Schedule BCP-F11 are the lowest possible rates consistent 
with sound business principles. The base charge and rates were 
developed following administrative policies and applicable laws.

[[Page 70631]]

Availability of Information

    Information used by WAPA to develop the base charge and rates for 
electric service is available for inspection and copying at the Desert 
Southwest Regional Office, located at 615 South 43rd Avenue, Phoenix, 
Arizona, 85009. Many of these documents are also available on DSW's 
website at https://www.wapa.gov/about-wapa/regions/dsw/rates/boulder-canyon-project-rates/.

Legal Authority

    DOE is setting rates for BCP electric service in accordance with 
section 302 of the DOE Organization Act (42 U.S.C. 7152). This 
provision transferred to, and vested in, the Secretary of Energy 
certain functions of the Secretary of the Interior, along with the 
power marketing functions of Reclamation.
    DOE regulations governing charges for the sale of BCP power, 10 CFR 
904.7(e), requires annual review of the BCP base charge and an 
``adjust[ment], either upward or downward, when necessary and 
administratively feasible, to assure sufficient revenues to effect 
payment of all costs and financial obligations associated with the 
[p]roject.'' WAPA's Administrator provided all BCP contractors an 
opportunity to comment on the proposed base charge adjustment, 
consistent with DOE procedures for public participation in rate 
adjustments. The BCP Electric Service Contract states that for years 
other than the first year and each fifth year thereafter, when the rate 
schedule is approved by the Deputy Secretary of Energy on a provisional 
basis and by FERC on a final basis, adjustments to the base charge 
``shall become effective upon approval by the Deputy Secretary of 
Energy.'' Accordingly, the Deputy Secretary of Energy may approve the 
FY 2025 base charge and rates for BCP electric service, as authorized 
by the BCP Electric Service Contract and DOE's procedures for public 
participation in rate adjustments set forth at 10 CFR parts 903 and 
904.\2\
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    \2\ 50 FR 37835 (Sept. 18, 1985) and 84 FR 5347 (Feb. 21, 2019).
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    Following DOE's review of WAPA's proposal, and as authorized by 
applicable provisions of the BCP Electric Service Contract, I have 
confirmed, approved, and placed the FY 2025 base charge and rates for 
BCP electric service, under Rate Schedule BCP F-11, into effect on a 
final basis through September 30, 2025.

Ratemaking Procedure Requirements

Environmental Compliance

    WAPA has determined that this action fits within the following 
categorical exclusions listed in appendix B to subpart D of 10 CFR part 
1021: B4.3 (Electric power marketing rate changes). Categorically 
excluded projects and activities do not require preparation of either 
an environmental impact statement or an environmental assessment.\3\ A 
copy of the categorical exclusion determination is available on WAPA's 
website at www.wapa.gov/regions/DSW/Environment/Pages/environment.aspx.
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    \3\ 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).
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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.

Signing Authority

    This document of the Department of Energy was signed on August 23, 
2024, by David M. Turk, Deputy 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 August 27, 2024.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2024-19562 Filed 8-29-24; 8:45 am]
BILLING CODE 6450-01-P