89 FR 169 pgs. 70629-70631 - Boulder Canyon Project
Type: NOTICEVolume: 89Number: 169Pages: 70629 - 70631
Pages: 70629, 70630, 70631FR document: [FR Doc. 2024-19562 Filed 8-29-24; 8:45 am]
Agency: Energy Department
Sub Agency: Western Area Power Administration
Official PDF Version: PDF Version
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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.
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:
[top] 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
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.
Footnotes:
1 ? Order Confirming and Approving Rate Schedule on a Final Basis, FERC Docket No. EF22-4-000.
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.
| FY 2024 | FY 2025 | Amount change | Percent change | |
|---|---|---|---|---|
| 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 |
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
[top] 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.
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
Footnotes:
2 ?50 FR 37835 (Sept. 18, 1985) and 84 FR 5347 (Feb. 21, 2019).
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.
Footnotes:
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).
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