[Federal Register Volume 90, Number 80 (Monday, April 28, 2025)]
[Notices]
[Pages 17591-17593]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-07270]
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DEPARTMENT OF ENERGY
Western Area Power Administration
Boulder Canyon Project
AGENCY: Western Area Power Administration, DOE.
ACTION: Notice of proposed fiscal year 2026 Boulder Canyon Project base
charge and rates for electric service.
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SUMMARY: The Desert Southwest region (DSW) of the Western Area Power
Administration (WAPA) proposes an adjustment to the fiscal year (FY)
2026 base charge and rates for Boulder Canyon Project (BCP) electric
service under Rate Schedule BCP-F11. The proposal would increase the
base charge 7.9 percent, from $74.3 million in FY 2025 to $80.2 million
in FY 2026. The change is due primarily to an increase in the Bureau of
Reclamation's (Reclamation) operations and maintenance (O&M) expenses
and a decrease in anticipated prior year carryover funds from FY 2025.
The proposed base charge and rates would go into effect on October 1,
2025, and remain in effect through September 30, 2026. Publication of
this Federal Register notice will initiate the public process.
DATES: A consultation and comment period begins April 28, 2025 and will
end on July 28, 2025. DSW will present a detailed explanation of the
proposed FY 2026 base charge and rates at a public information forum on
May 28, 2025, from 10 a.m. Mountain Standard Time to no later than 12
p.m. Mountain Standard Time. DSW will also host a public comment forum
on June 27, 2025, from 10 a.m. Mountain Standard Time to no later than
12 p.m. Mountain Standard Time, or until the last comment is received.
The public information and public comment forums will be held virtually
and in person at WAPA's Desert Southwest Regional Office located at 615
South 43rd Avenue, Phoenix, Arizona 85009. Instructions for
participating in the forums will be posted on DSW's BCP Rates website
at least 14 days prior to the public information and comment forums at:
www.wapa.gov/about-wapa/regions/dsw/rates/boulder-canyon-project-rates.
DSW will accept written comments any time during the consultation and
comment period.
As access to federal facilities is controlled, any U.S. citizen
wishing to attend a public forum at WAPA 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 at the time of the
meeting. Foreign nationals should contact Tina Ramsey, Rates Manager,
Desert Southwest Region, Western Area Power Administration, (602)812-
2355, or [email protected] in advance of a forum to obtain the
necessary form for admittance to the DSW Regional Office.
ADDRESSES: Written comments and requests to be informed of Federal
Energy Regulatory Commission (FERC) actions concerning the proposed
base charge and rates should be sent to: Regional Manager, Desert
Southwest Region, Western Area Power Administration, P.O. Box 6457,
Phoenix, AZ 85005-6457, or [email protected]. DSW will post
information concerning the rate process and written comments received
to its BCP Rates website at: www.wapa.gov/about-wapa/regions/dsw/rates/boulder-canyon-project-rates.
FOR FURTHER INFORMATION CONTACT: Tina Ramsey, Rates Manager, Desert
Southwest Region, Western Area Power Administration, (602) 812-2355, or
[email protected].
SUPPLEMENTARY INFORMATION: Hoover Dam,\1\ authorized by the Boulder
Canyon Project Act of 1928, as amended (43 U.S.C. 617, et seq.), sits
on the Colorado River along the Arizona-Nevada border. The Hoover Dam
power plant has 19 generating units (two for plant use) with installed
capacity of 2,078.8 megawatts (4,800 kilowatts for plant use). In
collaboration with Reclamation, WAPA markets and delivers hydropower
from the Hoover Dam power plant through high-voltage transmission lines
and substations to customers in Arizona, Southern California, and
Southern Nevada.
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\1\ Hoover Dam was known as Boulder Dam from 1933 to 1947, but
was renamed Hoover Dam by an April 30, 1947, joint resolution of
Congress. See Act of April 30, 1947, H.J. Res. 140, ch. 46, 61 Stat.
56-57.
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The rate-setting methodology for BCP calculates 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 for 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 customers 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 service.
On March 31, 2023, FERC approved and confirmed Rate Schedule BCP-
F11, under Rate Order No. WAPA-204, on a final basis through September
30, 2027.\2\ Rate Schedule BCP-F11 and the BCP Electric Service
Contract requires WAPA to determine the annual base charge and rates
for the next fiscal year before October 1 of each year. The FY 2025 BCP
base charge and rates expire on September 30, 2025.
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\2\ Order Confirming and Approving Rate Schedule on a Final
Basis, FERC Docket No. EF22-4-000.
Comparison of Base Charge and Rates
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FY 2025 FY 2026 Amount change Percent change
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Base Charge ($)............................... 74,334,285 80,184,173 5,849,888 7.9
Composite Rate (mills/kWh).................... 24.39 26.31 1.92 7.9
[[Page 17592]]
Energy Rate (mills/kWh)....................... 12.20 13.16 .96 7.9
Capacity Rate ($/kW-Mo)....................... 2.17 2.34 0.17 7.8
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The proposed FY 2026 base charge for BCP electric service is
projected to increase from $74.3 million in FY 2025 to $80.2 million in
FY 2026, a 7.9 percent increase.
Reclamation's FY 2026 budget is increasing $1.6 million, from $87.2
million to $88.8 million, a 1.8 percent increase from FY 2025. This
budget reflects a $3.1 million increase in O&M costs, primarily due to
higher projected labor costs for salaries, benefits, and overhead.
Additionally, services, materials and supplies, and equipment costs
have increased due to rising purchase needs and inflation. Several
large projects are being delayed, reducing replacements costs by $2.5
million. Post-retirement benefits costs are increasing $189,000 based
on a higher five-year average of recent actual expenses. Visitor
services costs are increasing $772,000 primarily due to higher
projected labor costs for salaries, benefits, overhead, and overtime.
WAPA's FY 2026 budget is unchanged from FY 2025 and will remain at
$10.1 million. Non-power revenue projections for Reclamation and WAPA
are decreasing $81,000 to $18.3 million, due to lower estimated
revenues for ancillary services. Prior year carryover is projected to
result in a shortfall of approximately $71,000, a $4.2 million decrease
from FY 2025. This decrease is attributed to higher execution rates in
FY 2024 and the allocation of previously collected multiyear project
funds for ongoing and upcoming work.
The composite and energy rates are increasing 7.9 percent, and the
capacity rate is increasing 7.8 percent from FY 2025. These unit rate
calculations use forecasted energy and capacity values, which may be
updated when determining the final base charge and rates if
hydrological conditions change.
WAPA's proposed base charge and rates for FY 2026, which would be
effective October 1, 2025, are preliminary and subject to change based
on modifications to forecasts before publication of the final base
charge and rates.
Legal Authority
WAPA is establishing 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. Those functions include
actions that specifically apply to the BCP.
WAPA's proposal to calculate the base charge and rates for FY 2026
constitutes a major rate adjustment, as defined by 10 CFR 903.2(d). In
accordance with 10 CFR 903.15, 10 CFR 903.16, and 10 CFR 904.7(e), DSW
will hold public information and public comment forums for this rate
adjustment. DSW will review and consider all timely public comments at
the conclusion of the consultation and comment period and adjust the
proposal as appropriate.
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.'' This proposal is issued pursuant to Delegation Order No.
S1-DEL-RATES-2016, effective November 19, 2016, in which the Secretary
of Energy delegated the authority to develop power and transmission
rates to WAPA's Administrator. 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 would approve the final FY 2026 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.\3\ The FY 2026 base charge will also
be filed at FERC for informational purposes only.
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\3\ 50 FR 37835 (Sept. 18, 1985) and 84 FR 5347 (Feb. 21, 2019).
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Availability of Information
All brochures, studies, comments, letters, memorandums, or other
documents that DSW initiates or uses to develop the proposed formula
rates for electric service and the base charge and rates are available
for inspection and copying at the Desert Southwest Regional Office,
located at 615 South 43rd Avenue, Phoenix, Arizona. Many of these
documents and supporting information are also available on DSW's BCP
Rates website at: www.wapa.gov/about-wapa/regions/dsw/rates/boulder-canyon-project-rates.
Ratemaking Procedure Requirements
Environmental Compliance
WAPA 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.\4\
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\4\ In compliance with the National Environmental Policy Act of
1969 (NEPA), 42 U.S.C. 4321 et seq., 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 April 22,
2025, by Tracey A. 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.
[[Page 17593]]
Signed in Washington, DC, on April 23, 2025.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2025-07270 Filed 4-25-25; 8:45 am]
BILLING CODE 6450-01-P