70744 Federal Register / Vol. 75, No. 222 / Thursday, November 18, 2010 / Notices 

Federal Energy Regulatory Commission, 

888 First Street, NE., Washington, DC 

20426. 

The filings in the above-referenced 

proceeding are accessible in the 

Commission’s eLibrary system by 

clicking on the appropriate link in the 

above list. They are also available for 

review in the Commission’s Public 

Reference Room in Washington, DC. 

There is an eSubscription link on the 

Web site that enables subscribers to 

receive e-mail notification when a 

document is added to a subscribed 

dockets(s). For assistance with any 

FERC Online service, please e-mail 

FERCOnlineSupport@ferc.gov or call 

(866) 208–3676 (toll free). For TTY, call 

(202) 502–8659. 

Nathaniel J. Davis, Sr., 

Deputy Secretary. 

[FR Doc. 2010–29042 Filed 11–17–10; 8:45 am] 

BILLING CODE 6717–01–P 

DEPARTMENT OF ENERGY 

Bonneville Power Administration 

[BPA File No.: BP–12] 

Fiscal Year (FY) 2012–2013 Proposed 

Power Rate Adjustments Public 

Hearing and Opportunities for Public 

Review and Comment 

AGENCY: Bonneville Power 

Administration (BPA), Department of 

Energy (DOE). 

ACTIONS: Notice of FY 2012–2013 

Proposed Power Rate Adjustments. 

SUMMARY: BPA is holding a consolidated 

rate proceeding, Docket No. BP–12, to 

establish power and transmission rates 

for FY 2012–2013. The purpose of this 

Federal Register Notice is to provide 

notice of the proposed power rates and 

the rates for control area services and 

certain ancillary services (listed below, 

Section IV.C.). BPA will issue a separate 

Federal Register Notice to provide 

notice of the proposed transmission 

rates and the rates for the other ancillary 

services. 

The Pacific Northwest Electric Power 

Planning and Conservation Act 

(Northwest Power Act) provides that 

BPA must establish and periodically 

review and revise its rates so that they 

are adequate to recover, in accordance 

with sound business principles, the 

costs associated with the acquisition, 

conservation, and transmission of 

electric power, including amortization 

of the Federal investment in the Federal 

Columbia River Power System (FCRPS) 

over a reasonable number of years and 

BPA’s other costs and expenses. The 

Northwest Power Act also requires that 

BPA’s rates be established based on the 

record of a formal hearing, and for 

transmission rates only, that the costs of 

the Federal transmission system be 

equitably allocated between Federal and 

non-Federal power utilizing the system. 

By this notice, BPA announces the 

commencement of a rate adjustment 

proceeding for proposed power rates, 

control area services rates, and certain 

ancillary services rates that will be 

effective on October 1, 2011. 

In the near future, BPA will begin a 

Residential Exchange Program (REP) 

Settlement Proceeding, Docket No. REP– 

12. This separate docket will provide a 

forum to review the terms and 

conditions of a proposed 17-year 

settlement of litigation regarding BPA’s 

implementation of the REP. Even 

though the proposed REP settlement 

involves issues interrelated with the 

establishment of power rates for the FY 

2012–2013 rate period, BPA has chosen 

to exclude certain issues from the 

development of power rates in the BP– 

12 rate proceeding and address them in 

the REP–12 proceeding. Specifically, the 

REP–12 proceeding will address 

whether BPA should adopt the REP 

settlement, issues regarding the terms of 

the REP settlement, the implementation 

of the section 7(b)(2) rate test, the 

implementation of the section 7(b)(3) 

allocation, the forecast of utilities’ 

Average System Costs (ASC), the 

amount and application of the 

remaining Lookback balance, and the 

allocation of REP costs to BPA’s power 

rates. The REP–12 proceeding will 

conclude prior to the publication of 

final studies and the issuance of the 

Record of Decision (ROD) in BP–12. The 

final decisions in REP–12 will be 

incorporated into the final studies and 

power rate calculations in BP–12. See 

section II.D.12. 

DATES: Anyone wishing to become a 

party to the BP–12 proceeding must 

provide written notice, via U.S. Mail or 

electronic mail, which must be received 

by BPA no later than 3 p.m. on 

November 24, 2010. 

The BP–12 rate adjustment 

proceeding begins with a prehearing 

conference at 9 a.m. on November 19, 

2010, in the BPA Rates Hearing Room, 

2nd floor, 911 NE 11th Avenue, 

Portland, Oregon 97232. 

Written comments by non-party 

participants must be received by 

February 18, 2011, to be considered in 

the Administrator’s ROD. 

ADDRESSES: 1. Petitions to intervene 

should be directed to: Hearing Clerk— 

L–7, Bonneville Power Administration, 

905 NE 11th Avenue, Portland, Oregon 

97232, or may be e-mailed to 

rateclerk@bpa.gov. In addition, copies 

of the petition must be served 

concurrently on BPA’s General Counsel 

and directed to both Mr. Peter J. Burger, 

LP–7, and Mr. Barry Bennett, LC–7, 

Office of General Counsel, 905 NE 11th 

Avenue, Portland, Oregon 97232, or via 

e-mail to pjburger@bpa.gov and 

bbennett@bpa.gov (see section III.A. for 

more information regarding 

interventions). 

2. Written comments by participants 

should be submitted to the Public 

Engagement Office, DKE–7, Bonneville 

Power Administration, P.O. Box 14428, 

Portland, Oregon 97293. Participants 

may also submit comments by e-mail at: 

http://www.bpa.gov/comment. BPA 

requests that all comments and 

documents intended to be part of the 

Official Record in this rate proceeding 

contain the designation BP–12 in the 

subject line. 

FOR FURTHER INFORMATION CONTACT: Ms. 

Heidi Y. Helwig, DKC–7, Public Affairs 

Specialist, Bonneville Power 

Administration, P.O. Box 3621, 

Portland, Oregon 97208; by phone toll 

free at 1–800–622–4520; or via e-mail to 

hyhelwig@bpa.gov. 

Responsible Officials: Mr. Raymond 

D. Bliven, Power Rates Manager, is the 

official responsible for the development 

of BPA’s power rates, and Ms. Rebecca 

E. Fredrickson, Transmission Rates 

Manager, is the official responsible for 

the development of BPA’s ancillary and 

control area services (ACS) rates. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

Part I. Introduction and Procedural 

Background 

Part II. Scope of 2012 Rate Proceeding 

Part III. Public Participation in BP–12 

Part IV. Summary of Rate Proposals 

Part V. Proposed 2012 Rate Schedules 

Part I—Introduction and Procedural 

Background 

Section 7(i) of the Northwest Power 

Act, 16 U.S.C. 839e(i), requires that 

BPA’s rates be established according to 

certain procedures, including 

publication in the Federal Register of 

this notice of the proposed rates; one or 

more hearings conducted as 

expeditiously as practicable by a 

Hearing Officer; opportunity for both 

oral presentation and written 

submission of views, data, questions, 

and arguments related to the proposed 

rates; and a decision by the 

Administrator based on the record. 

BPA’s rate proceedings are further 

governed by BPA’s Procedures 

Governing Bonneville Power 

Administration Rate Hearings, 51 FR 

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Federal Register / Vol. 75, No. 222 / Thursday, November 18, 2010 / Notices 70745 

7611 (1986), which implement and 

expand the statutory requirements. 

This proceeding is being conducted 

under the rule for general rate 

proceedings, section 1010.4 of BPA’s 

Procedures. The proposed schedule 

below applies to power rates and the 

ancillary and control area services rates 

that are covered by this Federal Register 

Notice. A final schedule will be 

established by the Hearing Officer at the 

prehearing conference. 

Prehearing/BPA Direct Case.November 19 

Intervention Deadline November 24 

Clarification ............... December 6–10 

Motions to Strike ....... December 13 

Data Request Deadline.December 13 

Answers to Motions 

to Strike.

December 20 

Data Response 

Deadline.

December 20 

Parties File Direct 

Case.

January 21 

Clarification ............... February 1–4 

Motions to Strike ....... February 7 

Data Request Deadline.February 7 

Answers to Motions 

to Strike.

February 14 

Data Response 

Deadline.

February 14 

Close of Participant 

Comments.

February 18 

Litigants File Rebuttal March 1 

Clarification ............... March 7–8 

Motions to Strike ....... March 9 

Data Request Deadline.March 9 

Answers to Motions 

to Strike.

March 16 

Data Response 

Deadline.

March 16 

Cross-Examination .... March 28–April 1 

Initial Briefs Filed ...... May 2 

Oral Argument ........... May 12 

Draft ROD Issued ..... June 14 

Briefs on Exceptions June 24 

Final ROD—Final 

Studies.

July 25 

Section 1010.7 of BPA’s Procedures 

prohibits ex parte communications. The 

ex parte rule applies to all BPA and 

DOE employees and contractors. Except 

as provided below, any outside 

communications with BPA and/or DOE 

personnel regarding the merits of any 

issue in BPA’s rate proceeding by other 

Executive Branch agencies, Congress, 

existing or potential BPA customers 

(including Tribes), or nonprofit or 

public interest groups are considered 

outside communications and are subject 

to the ex parte rule. The rule does not 

apply to communications relating to: (1) 

Matters of procedure only (the status of 

the rate proceeding, for example); (2) 

exchanges of data in the course of 

business or under the Freedom of 

Information Act; (3) requests for factual 

information; (4) matters for which BPA 

is responsible under statutes other than 

the ratemaking provisions; or (5) matters 

which all parties agree may be made on 

an ex parte basis. The ex parte rule 

remains in effect until the 

Administrator’s Final ROD is issued, 

which is scheduled to occur on or about 

July 25, 2011. 

Part II—Scope of 2012 Rate Proceeding 

A. Joint Rate Proceeding 

BPA is holding a wholesale power 

rate proceeding. As noted above in the 

summary, BPA will issue a separate 

Federal Register Notice to provide 

notice of the proposed transmission 

rates and rates for the remaining 

ancillary services (Scheduling, System 

Control, and Dispatch Service and 

Reactive Supply and Voltage Control 

from Generation Sources Service). 

B. 2010 Integrated Program Review 

BPA began its 2010 Integrated 

Program Review (IPR) process in May 

2010. The IPR process is designed to 

allow people interested in BPA’s 

program levels an opportunity to review 

and comment on all of BPA’s expense 

and capital spending level estimates in 

the same forum prior to the use of those 

estimates in setting rates. Concurrent 

with the IPR, BPA held regional 

conversations about risk mitigation and 

debt management practices. 

The 2010 IPR focused on FY 2012 and 

2013 program levels for BPA’s Power 

Services and Transmission Services as 

well as a review of FY 2011 program 

levels. BPA held 19 technical 

workshops and two general manager 

meetings at which proposed spending 

levels were presented for each of BPA’s 

programs. BPA carefully reviewed and 

considered the 26 written comments 

and numerous oral comments on FY 

2012 and 2013 program levels that were 

provided during this public process. 

On October 27, 2010, BPA issued the 

Final Close-Out Letter and 

accompanying final report for the IPR, 

which summarizes the comments 

received and outlines BPA’s responses. 

The report also summarizes comments 

and BPA’s responses on the regional 

conversations about risk mitigation and 

debt management. In the Final CloseOut Letter and report, BPA established 

the program level cost estimates for both 

power and transmission rates that are 

used in the Initial Proposal. BPA does 

not anticipate additional public review 

of proposed spending levels. However, 

an abbreviated IPR process may be held 

if conditions warrant. BPA would 

conduct this process separately from the 

rate proceeding to share updates and 

solicit feedback from customers and 

constituents before the final program 

levels are incorporated into the final 

rates. 

C. Rate Case Workshops 

In preparation for the BP–12 rate 

proceeding, BPA held several public 

rate case workshops with customers and 

interested parties from March through 

September 2010. During the workshops, 

BPA staff presented and discussed 

information about costs, load and 

resource forecasting, generation inputs 

pricing, segmentation, revenue 

forecasts, load forecasts, risk analysis 

and mitigation, products, pricing, and 

rate design. Customers and interested 

parties had extensive opportunity to 

participate, raise issues, present 

alternative proposals, and comment on 

the information BPA staff presented. 

The comments and alternatives received 

during these workshops have assisted in 

the preparation of the Initial Proposal. 

D. Scope of the Rate Proceeding 

This section provides guidance to the 

Hearing Officer as to those matters that 

are within the scope of the rate 

proceeding and those that are outside 

the scope. 

1. Program Cost Estimates 

Some of the decisions that determine 

program costs and spending levels have 

been made in the IPR public review 

process outside the rate proceeding. See 

section II.B. BPA’s spending levels for 

investments and expenses are not 

determined or subject to review in rate 

proceedings. 

Pursuant to section 1010.3(f) of BPA’s 

Procedures, the Administrator directs 

the Hearing Officer to exclude from the 

record all argument, testimony, or other 

evidence that challenges the 

appropriateness or reasonableness of the 

Administrator’s decisions on cost and 

spending levels. If, and to the extent 

that, any re-examination of spending 

levels is necessary, such re-examination 

will occur outside of the rate 

proceeding. This exclusion does not 

extend to portions of the revenue 

requirements related to interest rate 

forecasts, interest expense and credit, 

Treasury repayment schedules, forecasts 

of depreciation, forecasts of system 

replacements used in repayment 

studies, REP benefits, purchased power 

expenses, transmission acquisition 

expense incurred by Power Services, 

generation acquisition expense incurred 

by Transmission Services, minimum 

required net revenue, and the costs of 

risk mitigation actions resulting from 

the expense and revenue uncertainties 

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70746 Federal Register / Vol. 75, No. 222 / Thursday, November 18, 2010 / Notices 

included in the risk analysis. The 

Administrator also directs the Hearing 

Officer to exclude argument and 

evidence regarding BPA’s debt 

management practices and policies. See 

section II.D.7. 

2. Regional Dialogue Policy Decisions 

BPA’s Subscription contracts expire 

September 30, 2011, at the end of the 

current rate period. BPA engaged 

customers and interested stakeholders 

in an extensive process that led to new 

power sales contracts. BPA issued its 

Long-Term Regional Dialogue Final 

Policy and ROD on July 19, 2007, its 

Long-Term Regional Dialogue Contract 

Policy and ROD on October 31, 2008, 

the Tiered Rate Methodology and ROD 

on November 10, 2008, and the Tiered 

Rate Methodology Supplemental ROD 

on September 2, 2009. On or about 

December 1, 2008, BPA and its 

customers signed new power sales 

contracts under which the customers 

will purchase Federal power for the FY 

2012–2028 period. Several aspects of 

the Regional Dialogue process are still 

ongoing, such as establishing customer 

contract high water marks and contract 

demand quantities, and these processes 

and decisions are outside the scope of 

this rate proceeding. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to revisit the appropriateness or 

reasonableness of BPA’s decisions made 

in the Long-Term Regional Dialogue 

Final Policy ROD, or Long-Term 

Regional Dialogue Contract Policy ROD. 

3. Tiered Rate Methodology (TRM) 

Modifications to the TRM are within 

the scope of this proceeding; however, 

the TRM restricts BPA and customers 

with Contract High Water Mark 

(CHWM) contracts from proposing 

changes unless certain procedures have 

been successfully concluded. BPA has 

concluded these procedures regarding 

five proposed revisions, and these 

proposed revisions are within the scope 

of this proceeding. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to propose other proposed revisions to 

the TRM made by BPA, customers with 

a CHWM contract, their representatives, 

or representatives of their consumers, 

unless it can be established that the 

TRM procedures for proposing a change 

to the TRM have been concluded. This 

restriction does not extend to a party or 

customer that does not have a CHWM 

contract. 

4. Service to the Direct Service 

Industries (DSIs) 

The manner and method by which 

BPA could provide service or financial 

payments to its DSI customers were 

evaluated in Pacific Northwest 

Generating Cooperative, et al., v. 

Bonneville Power Administration, 580 

F3d 792 (9th Cir. 2008) (PNGC I) and 

Pacific Northwest Generating 

Cooperative, et al., v. Bonneville Power 

Administration, 590 F3d 1065 (9th Cir. 

2010) (PNGC II). BPA is assuming for 

the Initial Proposal that BPA will 

continue to serve Alcoa, Inc. (Alcoa) as 

well as Port Townsend Paper 

Corporation (Port Townsend) during FY 

2012–2013. BPA’s decisions to serve the 

DSIs, along with the method and level 

of service to be provided DSIs in the FY 

2012–2013 rate period, will not be 

determined in this proceeding. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator directs 

the Hearing Officer to exclude from the 

record all argument, testimony, or other 

evidence that seeks in any way to revisit 

the appropriateness or reasonableness of 

BPA’s decisions regarding the service to 

the DSIs, including BPA’s decision to 

offer a contract and the method or level 

of such service. 

5. Generation Inputs 

BPA provides a portion of the 

available generation from the FCRPS to 

enable Transmission Services to meet its 

various requirements. Transmission 

Services uses these generation inputs to 

provide ancillary and control area 

services. To recover the costs associated 

with providing generation inputs, BPA 

assigns a portion of the FCRPS costs to 

the transmission function. The forecast 

amount of generation inputs, cost 

allocations BPA is proposing to use to 

determine the generation input costs, 

and associated Ancillary and Control 

Area Service rates are matters that are 

included within the scope of the BP–12 

proceeding. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator directs 

the Hearing Officer to exclude from the 

record all argument, testimony, or other 

evidence that seeks in any way to revisit 

the appropriateness or reasonableness of 

any other issues related to the 

generation inputs or Ancillary and 

Control Area Services. This exclusion 

includes, but is not limited to, issues 

regarding reliability of the transmission 

system, any existing or proposed 

Transmission Services dispatcher 

standing orders, e-Tag requirements, 

and business practices. These non-rates 

issues are generally addressed by BPA 

in accordance with industry, reliability, 

and other compliance standards and 

criteria and are not matters appropriate 

for the rate proceeding. 

6. Proposal for the Post-2011 

Conservation Program Structure 

Through the post-2011 workgroup 

collaboration, customers and 

constituents provided input on the 

development of BPA’s post-2011 

conservation approach. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to revisit the appropriateness or 

reasonableness of BPA’s conservation 

program established through the Post2011 Conservation Program dated 

August 18, 2010. 

7. Federal and Non-Federal Debt Service 

and Debt Management 

During the 2010 IPR and in other 

forums, BPA provided the public with 

background information on BPA’s 

internal Federal and non-Federal debt 

management policies and practices. 

While these policies and practices are 

not decided in the IPR forum, these 

discussions were intended to inform 

interested parties about these matters so 

that they would better understand 

BPA’s debt structure. Notwithstanding 

the public discussions, BPA’s debt 

management policies and practices 

remain outside the scope of the rate 

proceeding. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to address the appropriateness or 

reasonableness of BPA’s debt 

management policies and practices. 

8. Potential Environmental Impacts 

Environmental impacts are addressed 

in a concurrent National Environmental 

Policy Act (NEPA) process. See section 

II.E. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator directs 

the Hearing Officer to exclude from the 

record all argument, testimony, or other 

evidence that seeks in any way to 

address the potential environmental 

impacts of the rates being developed in 

this rate proceeding. 

9. Average System Cost Methodology 

Section 5(c) of the Northwest Power 

Act established the REP, which provides 

benefits to residential and small-farm 

consumers of Pacific Northwest utilities 

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Federal Register / Vol. 75, No. 222 / Thursday, November 18, 2010 / Notices 70747 

based, in part, on a utility’s ‘‘average 

system cost’’ (ASC) of resources. Section 

5(c)(7) of the Act requires the 

Administrator to consult with regional 

interests to develop an ASC 

Methodology (ASCM). The ASCM 

prescribes the methodology that the 

Administrator uses to calculate a 

utility’s ASC. On September 4, 2009, the 

Federal Energy Regulatory Commission 

(Commission) granted final approval of 

BPA’s 2008 ASCM. The 2008 ASCM is 

not subject to challenge or review in a 

section 7(i) proceeding. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to visit or revisit the appropriateness or 

reasonableness of the 2008 ASCM. 

10. Average System Cost Review 

Processes 

To receive REP benefits for FY 2012– 

2013, utilities must file proposed ASCs 

with BPA pursuant to the terms and 

conditions of the 2008 ASCM. These 

filings are reviewed by BPA staff and 

other interested parties in ASC review 

processes. The ASC review process is a 

separate administrative proceeding 

conducted by BPA under the terms of 

the 2008 ASCM. In the review process, 

BPA staff and other parties evaluate the 

ASC filed by a participating utility for 

conformance with the requirements of 

the 2008 ASCM. At the conclusion of 

the process, BPA issues an ASC Report, 

which formally establishes the utility’s 

ASC for the Exchange Period, which 

coincides with BPA’s rate period. 

On June 1, 2010, ten utilities filed 

proposed ASCs with BPA for FY 2012– 

2013. One utility subsequently 

withdrew its ASC filing. BPA staff and 

other parties are currently reviewing the 

remaining nine filings in the ASC 

review processes. Once these ASC 

review processes are complete, and BPA 

has issued final ASC Reports, BPA will 

incorporate the final ASCs into the 

administrative record of this 

proceeding. Although these ASC 

determinations provide important 

information for setting BPA’s rates, they 

are not rate proceeding matters. Parties 

intending to challenge the draft or final 

ASC determinations for FY 2012–2013 

must raise such issues in the ASC 

review process according to the 

procedures established in the 2008 

ASCM. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to visit or revisit the draft or final ASC 

determinations for FY 2012–2013. 

11. Contract High Water Mark (CHWM) 

Process 

Under the Tiered Rate Methodology 

(TRM), BPA will establish both CHWMs 

and FY 2012–2013 Rate Period High 

Water Mark (RHWMs) for Public 

customers that signed contracts for firm 

requirements power service providing 

for tiered rates, referred to as CHWM 

contracts. The CHWMs and RHWMs 

will be established in the CHWM 

Process, which will occur mainly in 

Spring 2011. In this process BPA will 

establish the maximum planned amount 

of power a customer is eligible to 

purchase at Tier 1 rates during the rate 

period. The CHWM Process provides 

customers an opportunity to review, 

comment, and, if necessary, challenge 

BPA’s determinations regarding certain 

CHWM and RHWM determinations. To 

the extent they are available, the final 

RHWM determinations for FY 2012– 

2013 from the CHWM Process will be 

used in the final rates proposal. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to visit or revisit BPA’s determination of 

a customer’s CHWM or FY 2012–2013 

RHWM. 

12. Residential Exchange Program 

Settlement Proceeding (REP–12) 

The REP was established in section 

5(c) of the Northwest Power Act to 

provide utilities with high ASCs access 

to the benefits of the FCRPS for their 

residential and small farm consumers. 

As discussed in the summary above, 

BPA will commence a separate section 

7(i) proceeding, Docket No. REP–12, to 

review the REP settlement. Certain 

issues will be excluded from the BP–12 

rate proceeding and addressed in the 

REP–12 proceeding. This exclusion is 

one of efficiency, minimizing the need 

for duplicate argument, testimony, or 

other evidence in both proceedings; it is 

not meant to limit the opportunity for 

parties to file relevant argument, 

testimony, or other evidence regarding 

these REP issues. The REP–12 

proceeding will conclude prior to the 

publication of final rates and the 

issuance of the ROD in BP–12. All 

argument, testimony, or other evidence 

in the REP–12 record will be 

incorporated into BP–12 record and the 

final decisions in REP–12 will be 

implemented in the final rate 

development in BP–12. 

Pursuant to § 1010.3(f) of BPA’s 

Procedures, the Administrator hereby 

directs the Hearing Officer to exclude 

from the record all argument, testimony, 

or other evidence that seeks in any way 

to visit issues related to the issues being 

addressed in the REP–12 proceeding, 

including, but not limited to, whether 

BPA should adopt the REP settlement, 

issues regarding the terms of the REP 

settlement, the implementation of the 

section 7(b)(2) rate test, the 

implementation of the section 7(b)(3) 

allocation, the forecast of utilities’ 

Average System Costs, the amount and 

application of the remaining Lookback 

balance, and the allocation of REP costs 

to BPA’s power rates. 

E. The National Environmental Policy 

Act 

BPA is in the process of assessing the 

potential environmental effects of its 

proposed power and transmission rates, 

consistent with the NEPA. The NEPA 

process is conducted separately from 

the rate proceeding. As discussed in 

section II.D.8, all evidence and 

argument addressing potential 

environmental impacts of rates being 

developed in the BP–12 rate proceeding 

are excluded from the rate proceeding 

hearing record. Rather, comments on 

environmental effects should be 

directed to the NEPA process. 

Because this proposal involves BPA’s 

ongoing business practices related to 

rates, BPA is reviewing the proposal for 

consistency with BPA’s Business Plan 

Environmental Impact Statement 

(Business Plan EIS), completed in June 

1995 (BOE/EIS–0183). This policy-level 

EIS evaluates the environmental 

impacts of a range of business plan 

alternatives for BPA that could be varied 

by applying various policy modules, 

including one for rates. Any 

combination of alternative policy 

modules should allow BPA to balance 

its costs and revenues. The Business 

Plan EIS also includes response 

strategies, such as adjustments to rates, 

that BPA could implement if BPA’s 

costs exceed its revenues. 

In August 1995, the BPA 

Administrator issued a ROD (Business 

Plan ROD) that adopted the MarketDriven Alternative from the Business 

Plan EIS. This alternative was selected 

because, among other reasons, it allows 

BPA to: (1) Recover costs through rates; 

(2) competitively market BPA’s products 

and services; (3) develop rates that meet 

customer needs for clarity and 

simplicity; (4) continue to meet BPA’s 

legal mandates; and (5) avoid adverse 

environmental impacts. BPA also 

committed to apply as many response 

strategies as necessary when BPA’s costs 

and revenues do not balance. 

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70748 Federal Register / Vol. 75, No. 222 / Thursday, November 18, 2010 / Notices 

In April 2007, BPA completed and 

issued a Supplement Analysis to the 

Business Plan EIS. This Supplement 

Analysis found that the Business Plan 

EIS’s relationship-based and policylevel analysis of potential 

environmental impacts from BPA’s 

business practices remains valid, and 

that BPA’s current business practices 

remain consistent with BPA’s MarketDriven Alternative approach. The 

Business Plan EIS and ROD thus 

continue to provide a sound basis for 

making determinations under NEPA 

concerning BPA’s policy-level 

decisions, including rates. 

Because the proposed rates likely 

would assist BPA in accomplishing the 

goals identified in the Business Plan 

ROD, the proposal appears consistent 

with these aspects of the Market-Driven 

Alternative. In addition, this rate 

proposal is similar to the type of rate 

designs evaluated in the Business Plan 

EIS; thus, implementation of this rate 

proposal would not be expected to 

result in environmental impacts 

significantly different from those 

examined in the Business Plan EIS. 

Therefore, BPA expects that this rate 

proposal likely will fall within the 

scope of the Market-Driven Alternative 

that was evaluated in the Business Plan 

EIS and adopted in the Business Plan 

ROD. 

As part of the Administrator’s ROD 

that will be prepared for the BP–12 rate 

proceeding, BPA may tier its decision 

under NEPA to the Business Plan ROD. 

However, depending upon the ongoing 

environmental review, BPA may instead 

issue another appropriate NEPA 

document. Comments regarding the 

potential environmental effects of the 

proposal may be submitted to Katherine 

Pierce, NEPA Compliance Officer, KEC– 

4, Bonneville Power Administration, 

905 NE 11th Avenue, Portland, OR 

97232. Any such comments received by 

the comment deadline for Participant 

Comments identified in section III.A. 

below will be considered by BPA’s 

NEPA compliance staff in the NEPA 

process that will be conducted for this 

proposal. 

Part III—Public Participation in BP–12 

A. Distinguishing Between 

‘‘Participants’’ and ‘‘Parties’’ 

BPA distinguishes between 

‘‘participants in’’ and ‘‘parties to’’ the 

hearings. Apart from the formal hearing 

process, BPA will receive written 

comments, views, opinions, and 

information from ‘‘participants,’’ who 

may submit comments without being 

subject to the duties of, or having the 

privileges of, parties. Participants’ 

written comments will be made part of 

the official record and considered by the 

Administrator. Participants are not 

entitled to participate in the prehearing 

conference; may not cross-examine 

parties’ witnesses, seek discovery, or 

serve or be served with documents; and 

are not subject to the same procedural 

requirements as parties. BPA customers 

whose rates are subject to this 

proceeding, or their affiliated customer 

groups, may not submit participant 

comments. Members or employees of 

organizations that have intervened in 

the rate proceeding may submit general 

comments as participants but may not 

use the comment procedures to address 

specific issues raised by their intervenor 

organizations. 

Written comments by participants 

will be included in the record if they are 

received by February 18, 2011. Written 

views, supporting information, 

questions, and arguments should be 

submitted to the address listed in the 

ADDRESSES section of this Notice. 

Entities or people become parties to 

the proceeding by filing petitions to 

intervene, which must state the name 

and address of the entity or person 

requesting party status and the entity’s 

or person’s interest in the hearing. BPA 

customers and affiliated customer 

groups will be granted intervention 

based on petitions filed in conformance 

with BPA’s Procedures. Other 

petitioners must explain their interests 

in sufficient detail to permit the Hearing 

Officer to determine whether the 

petitioners have a relevant interest in 

the hearing. Pursuant to Rule 1010.1(d) 

of BPA’s Procedures, BPA waives the 

requirement in Rule 1010.4(d) that an 

opposition to an intervention petition be 

filed and served 24 hours before the 

prehearing conference. The time limit 

for opposing a timely intervention will 

be established at the prehearing 

conference. Any party, including BPA, 

may oppose a petition for intervention. 

All petitions will be ruled on by the 

Hearing Officer. Late interventions are 

strongly disfavored. Opposition to an 

untimely petition to intervene must be 

filed and received by BPA within two 

days after service of the petition. 

B. Developing the Record 

The hearing record will include, 

among other things, the transcripts of 

the hearing, written evidence and 

argument entered into the record by 

BPA and the parties, written comments 

from participants, and other material 

accepted into the record by the Hearing 

Officer. The Hearing Officer will then 

review the record and certify the record 

to the Administrator for final decision. 

The Administrator will develop final 

rates based on the record and such other 

materials and information as may have 

been submitted to or developed by the 

Administrator. The Administrator will 

serve copies of the Final ROD on all 

parties. BPA will file its rates with the 

Commission for confirmation and 

approval after issuance of the Final 

ROD. 

Part IV—Summary of Rate Proposals 

A. Power Rates 

BPA is proposing five different rates 

for sales of Federal power or use of 

Federal resources. 

Priority Firm Power Rate (PF–12)— 

The PF rate schedule applies to net 

requirements power sales to public 

body, cooperative, and Federal agency 

customers made pursuant to section 5(b) 

of the Northwest Power Act and 

includes the PF Public rates for the sale 

of firm requirements power under 

CHWM Contracts and the PF Exchange 

rates for sales under a Residential 

Purchase and Sale Agreement. The PF 

Public rate applies to customers taking 

load following or Slice/block service. 

Consistent with the TRM, Tier 1 rates 

include three customer charges, a 

demand charge and a load shaping 

charge. The billing determinants to 

which these rates apply are changing 

significantly from BPA’s current PF rate 

structure. In addition, two Tier 2 rates, 

corresponding to contract options, are 

provided for customers that have chosen 

to purchase power from BPA for their 

load growth. 

While an exact comparison of the 

proposed rates to the prior rates is 

difficult because of the transition to the 

tiered rate construct in this proceeding, 

BPA has developed the Tier 1 Net 

Average Cost to represent a close 

approximation of the average PF rate 

under the old rate design. The Tier 1 

Average Net Cost under the initial 

proposal is $29.05/MWh, which 

represents about an 8.3 percent increase 

over the FY 2010–2011 equivalent of the 

Tier 1 Average Net Cost. This level of 

rate increase assumes that the proposed 

settlement of the REP is adopted. In the 

event the settlement is not adopted, the 

Tier 1 Average Net Cost would be an 8.5 

percent increase over FY 2010–2011. 

The Base PF Exchange rate and its 

associated surcharges apply to the sale 

of power to regional utilities that 

participate in the REP established under 

section 5(c) of the Northwest Power Act. 

16 U.S.C. 839c(c). Because BPA’s BP–12 

Initial Rate Proposal contains PF Public 

rates based on the proposed REP 

Settlement, the Initial Rate Proposal’s 

PF Exchange rates were established 

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consistent with the terms of the 

proposed REP Settlement. These rates 

would likely change if the proposed 

REP Settlement is not adopted by BPA. 

Utility-specific REP Surcharges are 

developed consistent with the expected 

terms of the REP settlement. If the REP 

settlement is not adopted, BPA would 

develop final rates consistent with the 

results of the section 7(b)(2) rate test and 

reallocations of rate protection costs 

pursuant to section 7(b)(3) of the 

Northwest Power Act, as those 

procedures are determined in the REP– 

12 proceeding. 

In addition, the proposed PF–12 rate 

schedule includes rates for customers 

with non-Federal resources that have 

elected to take Diurnal Flattening 

Service or Secondary Crediting Service 

and a melded PF rate for Public 

customers should any elect a power 

sales contract other than a CHWM 

Contract for firm requirements service. 

New Resource Firm Power Rate (NR– 

12)—The NR–12 rate applies to net 

requirements power sales to InvestorOwned Utilities (IOUs) made pursuant 

to section 5(b) of the Northwest Power 

Act, for direct consumption, for 

construction, test and start-up, and 

station service. The NR–12 rate is also 

applied to sales of firm power to Public 

customers serving new large single 

loads. BPA is forecasting no sales at the 

NR rate in the Initial Proposal. As with 

the PF rate, the NR–12 rate has been 

calculated in a manner consistent with 

the expected terms of the REP 

settlement. The proposed average NR– 

12 rate is $68.62/MWh, a decrease of 0.1 

percent from the NR–10 rate. 

Industrial Firm Power Rate (IP–12)— 

The IP rate is applicable to firm power 

sales to DSI customers authorized by 

section (5)(d)(1)(A) of the Northwest 

Power Act. 16 U.S.C 839c(d)(1)(A). BPA 

is forecasting annual sales of 340 

average megawatts (aMW) to DSIs in the 

Initial Proposal. See section IV.B.3. As 

with the PF rate, the Initial Proposal IP– 

12 rate has been calculated in a manner 

consistent with the expected terms of 

the REP settlement. The proposed 

average IP–12 rate is $36.46/MWh, an 

increase of 5.4 percent over the IP–10 

rate. In the event the settlement is not 

adopted, the IP–12 rate would be 

$38.71/MWh, which would represent an 

11.9 percent increase over FY 2010– 

2011. 

Firm Power Products and Services 

Rate (FPS–12)—The FPS rate schedule 

is applicable to purchasers of Firm 

Power, Capacity Without Energy, 

Supplemental Control Area Services, 

Shaping Services, Reservation and 

Rights to Change Services, and 

Reassignment or Remarketing of Surplus 

Transmission Capacity, for use inside 

and outside the Pacific Northwest. The 

rates for these products are negotiated 

between BPA and the purchaser. In 

addition, the FPS rate schedule includes 

rates for customers with non-Federal 

resources that have elected to take 

Resource Support Services or Resource 

Shaping Services or Transmission 

Scheduling Service/Transmission 

Curtailment Management Service and 

Forced Outage Reserve Service. 

General Transfer Agreement Service 

Rate (GTA–12)—The GTA rate schedule 

includes the GTA Delivery Charge and 

Transfer Service Operating Reserve 

Charge. The GTA Delivery Charge 

applies to customers that purchase 

Federal power that is delivered over 

non-Federal low-voltage transmission 

facilities. For FY 2012–2013, BPA is 

proposing to continue the GTA Delivery 

Charge at the same level as the GTA–10 

rate. In addition, BPA is proposing to 

continue an Operating Reserves rate for 

transfer service customers that will 

become effective when proposed 

changes to Western Electricity 

Coordinating Council (WECC) Operating 

Reserve Requirements become effective. 

B. Significant Changes in the BP–12 

Initial Rate Proposal for Power Rates 

and Ancillary Service and Control Area 

Service Rates 

1. Tiered PF Rate 

In this BP–12 rate proceeding, Power 

Services is implementing the TRM for 

the first time to coincide with the 

commencement of power deliveries 

under new CHWM power sales 

contracts. The TRM provides for a twotiered PF rate design applicable to firm 

requirements power service for those 

customers that signed new CHWM 

contracts that provide for service under 

tiered rates. Tiered rate design 

differentiates between the costs of 

service associated with the existing 

Federal system resources (Tier 1) and 

the cost associated with additional 

amounts of power needed to serve the 

remaining portion of customers’ net 

requirements (Tier 2). This rate design 

assures, to the extent possible, that 

customers will be able to purchase 

power at a Tier 1 rate that does not 

include the costs of serving other 

customers’ load growth. 

Among other things, the TRM 

addresses how costs will be allocated to 

the PF Tier 1 and Tier 2 rate pools and 

how rates for Tier 1 and Tier 2 sales and 

resource support services will be 

designed. These cost allocation and rate 

design methods are being implemented 

for the first time in the BP–12 rate 

proceeding. The TRM also addresses the 

rate design for Tier 1 rates, including 

the form of the rates and the billing 

determinants to which the rates are 

applied. Specifically, the TRM provides 

for three customer charge rates, a set of 

load shaping rates, and a new 

determination and application of 

demand rates. 

BPA is proposing to make five 

revisions to the TRM in this rate 

proceeding. Procedures set forth in the 

TRM, Chapter 13, were followed prior to 

this initial rate proposal to enable BPA 

to propose the changes. The five 

proposed revisions are assumed to be in 

effect in the development of the initial 

power rate proposal. 

2. Generation Inputs; Ancillary and 

Control Area Services 

BPA’s proposed allocation of 

generation input costs and associated 

ancillary and control area services rates 

are similar to the generation input cost 

allocations and rates in the 2010 BPA 

rates, with a few significant differences. 

First, BPA is proposing to change the 

name of the ‘‘Wind Balancing Service’’ 

rate to Variable Energy Resource 

Balancing Service (VERBS) rate to 

reflect the broader application of the 

rate to solar as well as wind resources. 

VERBS provides the generation 

capability (ability to both increase and 

decrease generation) to follow withinhour variations of variable energy 

resources in the BPA Balancing 

Authority Area. 

The proposed VERBS rate recovers 

the cost of regulating reserves, following 

reserves, and imbalance reserves that 

provide balancing reserve capacity. BPA 

is proposing to directly assign certain 

costs associated with providing VERBS. 

BPA is also proposing two formula rate 

adjustments under the VERBS rate to 

recover the costs associated with: (1) 

The Administrator’s decision to replace, 

if necessary, FCRPS balancing reserve 

capacity that becomes unavailable 

during the rate period with reserve 

acquisitions from non-Federal sources 

in order to continue providing VERBS; 

and (2) the Administrator’s decision to 

make any acquisitions of non-Federal 

balancing reserve capacity to provide 

VERBS for the rate period. 

Also included in the proposed VERBS 

rate schedule is the rate for the 

proposed Provisional Variable Energy 

Resource Balancing Service 

(‘‘Provisional Balancing Service’’), a new 

Control Area Service that would be 

offered to generating customers that: (1) 

Have elected to self-supply, but are 

unable to continue to do so; or (2) 

accelerate their interconnection date 

into the FY 2012–2013 rate period from 

a future rate period. The billing factor 

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and rate for Provisional Balancing 

Service is the same as the VERBS rate. 

BPA is proposing a rate for the new 

Dispatchable Energy Resource Balancing 

Service (DERBS), a new Control Area 

Service for all thermal generators in the 

BPA Balancing Authority Area. This 

service is necessary to support the 

within-hour deviations of thermal 

generation from the hourly generation 

estimate (i.e., schedule). A thermal 

generator in the BPA Balancing 

Authority Area is charged for DERBS 

based on its monthly use of balancing 

reserve capacity. BPA is also proposing 

a penalty charge under DERBS that will 

apply to any thermal generator’s 

excessive use of balancing reserve 

capacity. 

In addition to hourly settlement of 

energy and generation imbalance service 

charges, BPA is proposing to settle 

generation and energy imbalance service 

charges for half-hour schedules on an 

integrated half-hour basis upon 30 days’ 

notice that BPA has completed the 

technical and operational modifications 

that are necessary to implement intrahour scheduling. BPA is also proposing 

to exempt solar resources from 

Deviation Band 3 penalty charges under 

the Energy and Generation Imbalance 

rates. 

Furthermore, BPA is proposing to add 

certain criteria to clarify the definition 

of ‘‘Persistent Deviation’’ for Imbalance 

Services. If BPA determines that a 

customer’s scheduling accuracy 

performs at 30-minute persistence 

scheduling accuracy, or better, in one or 

more hours of a Persistent Deviation 

event, BPA is proposing to exempt that 

hour from Persistent Deviation penalty 

charge, but not the adjacent hours that 

would otherwise qualify for a Persistent 

Deviation penalty charge. 

BPA is proposing to replace the fourhour standard for Persistent Deviation 

with a three-hour standard to measure 

schedule deviations once BPA 

implements intra-hour scheduling on a 

permanent basis. BPA will provide 30 

days notice before implementing the 

three-hour standard. 

BPA is also proposing to update the 

language in Part C of the definition of 

Persistent Deviation to clarify that a 

pattern of under- or over-delivery or 

over- or under-use of energy that occurs 

generally or at specific times of the day 

constitutes a Persistent Deviation. 

Finally, BPA is proposing to subject 

the following ACS rates to BPA’s Cost 

Recovery Adjustment Clause, Dividend 

Distribution Clause and NFB 

Mechanisms: Regulation and Frequency 

Response Service, Operating Reserve— 

Spinning Reserve Service, Operating 

Reserve—Supplemental Reserve 

Service, VERBS, Provisional Balancing 

Service, and DERBS rates. 

3. DSI Service for FY 2012–2013 

For the Initial Proposal, BPA is 

forecasting sales of 340 aMW to Alcoa 

and Port Townsend for the FY 2012– 

2013 rate period. Uncertainty exists 

regarding the level of service to the DSIs 

during the upcoming rate period. 

Following the Ninth Circuit’s decisions 

in PNGC I and PNGC II, BPA and Alcoa 

signed a power sales contract 

terminating in 2016 but with periodic 

service decision points during its term; 

service under this contract was recently 

extended through May 2012. It is not 

known at this point whether or not Port 

Townsend will extend its current 

contract, which expires at the end of 

May 2011. In addition, even though 

Columbia Falls Aluminum Company is 

currently not operating, it could begin 

operation and request service at some 

point during the FY 2012–2013 rate 

period. Uncertainty associated with the 

amount and cost of service is accounted 

for in the Power Risk and Market Price 

Study. 

4. Risk Mitigation Tools 

The main financial risk mitigation 

tool BPA relies upon is financial 

liquidity, comprising cash, other 

investments in the Bonneville Fund at 

the U.S. Treasury, and a short-term 

liquidity facility with the U.S. Treasury. 

BPA proposes to include provisions for 

two rate adjustments: The Cost Recovery 

Adjustment Clause (CRAC), which can 

generate additional cash within the rate 

period, and the Dividend Distribution 

Clause (DDC), which can return cash to 

customers when BPA’s financial 

reserves are larger than needed to meet 

its Treasury Payment Probability (TPP) 

standard. When available liquidity and 

the CRAC are insufficient to meet the 

TPP standard, BPA includes Planned 

Net Revenues for Risk (PNRR) in its 

rates. In the Initial Proposal, BPA 

proposes to include no PNRR and to cap 

the maximum revenue recoverable 

through the CRAC at $300 million. BPA 

will also rely on $150 million of 

reserves attributed to transmission as 

part of its risk mitigation package. 

BPA is proposing some changes to the 

risk mitigation tools in the BP–12 Initial 

Proposal, including a minor revision to 

the metric used to determine whether a 

CRAC or DDC triggers. In the past, this 

metric has been Accumulated Modified 

Net Revenues. In this proceeding, BPA 

is proposing to use Accumulated Net 

Revenue. The thresholds for triggering 

the CRAC and DDC remain unchanged 

from WP–10 equivalent reserve levels 

($0.00 and $750 million respectively). 

BPA anticipates discussing in the rate 

case whether the current threshold 

levels are sufficient to protect against 

future risks. BPA also proposes to 

continue the National Marine Fisheries 

Service FCRPS Biological Opinion 

Adjustment (NFB Adjustment) and the 

Emergency NFB Surcharge, given that 

litigation regarding the Biological 

Opinion continues. 

5. Settlement of the Residential 

Exchange Program Disputes 

To establish rates and determine REP 

benefits for exchanging utilities for FY 

2012–2013, BPA is assuming in the BP– 

12 Initial Proposal that the REP 

settlement will be adopted. This 

assumption is intended to be a 

placeholder while BPA evaluates the 

proposed REP settlement in the related 

REP–12 proceeding. Whether BPA 

establishes final rates based on the 

terms and conditions in the REP 

settlement will depend on the 

Administrator’s final decision in the 

REP–12 proceeding. Once a final 

decision is reached, it will be reflected 

in the final studies. BPA will 

incorporate all relevant material from 

the REP–12 proceeding into the record 

of the BP–12 rate proceeding. 

6. Rate Schedules 

Implementing the TRM rate design 

required significant reworking of the PF 

rate schedule. In addition, the changes 

to the way the demand charges will be 

calculated under the IP and NR rates 

also led to changes in those rate 

schedules. These proposed changes to 

rate schedules will be available for 

examination by parties during the rate 

proceeding. 

7. Other Changes to Power General Rate 

Schedule Provisions 

BPA proposes to modify the UAI, LDD 

(consistent with the TRM), an irrigation 

rate discount (also consistent with the 

TRM), and an Unanticipated Load 

Charge (to replace the current Targeted 

Adjustment Clause). 

C. Ancillary and Control Area Services 

Rates 

BPA is proposing rates for four 

ancillary services: Regulation and 

Frequency Response Service; Energy 

Imbalance Service; Operating Reserve— 

Spinning Reserve Service; and 

Operating Reserve—Supplemental 

Reserve Service. In addition to the rates 

for Ancillary Services, BPA is proposing 

rates for six control area services: 

Regulation and Frequency Response 

Service; Generation Imbalance Service; 

Operating Reserve—Spinning Reserve 

Service; Operating Reserve— 

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Federal Register / Vol. 75, No. 222 / Thursday, November 18, 2010 / Notices 70751 

Supplemental Reserve Service; Variable 

Energy Resource Balancing Service; and 

Dispatchable Energy Resource Balancing 

Service. 

D. Overview of Studies 

The initial rate proposal for power 

rates and ancillary service and control 

area service rates is explained and 

documented in the following studies. 

1. Power Rates Study 

The Power Rates Study (formerly the 

Wholesale Power Rate Development 

Study) explains and documents the 

development of power rates and billing 

determinants for BPA’s power products 

and services. The new Priority Firm rate 

design, as set forth in the Tiered Rate 

Methodology, is implemented with this 

proposal for the first time. The TRM 

provides for a two-tiered PF rate design 

applicable to firm requirements power 

service for Public customers that signed 

a CHWM contract providing for tiered 

rates. The TRM also addresses other rate 

design changes, particularly for power 

sold at Tier 1 rates. As explained in 

section IV.A. of this notice, the Power 

Rates Study reflects the assumption of a 

specific REP settlement outcome to 

model the rates. The results of the study 

are reflected in the proposed power rate 

schedules. 

2. Power Loads and Resources Study 

The Power Loads and Resources 

Study explains and documents the 

compilation of the load and resource 

data and forecasts necessary for 

developing BPA’s wholesale power 

rates. The Study has three major 

interrelated components: The Federal 

system load forecast; The Federal 

system resource forecast; and the 

Federal system loads and resources 

balance. 

3. Power Revenue Requirement Study 

The Power Revenue Requirement 

Study explains and documents the level 

of revenues from power rates necessary 

to recover, in accordance with sound 

business principles, the FCRPS costs 

associated with the production, 

acquisition, marketing, and 

conservation of electric power. Cost 

estimates in the Power Revenue 

Requirement Study are based on the 

results of the IPR, as presented in the 

Final Close-Out Letter dated October 27, 

2010. The repayment studies reflect 

actual and projected repayment 

obligations and transactions related to 

BPA’s Debt Optimization program. All 

new capital investments are assumed to 

be financed from debt or appropriations. 

The adequacy of projected revenues to 

recover the rate test period revenue 

requirement and to recover the Federal 

investment over the prescribed 

repayment period is tested and 

demonstrated for the generation 

function. 

4. Power Risk and Market Price Study 

The Power Risk and Market Price 

Study has three major components: 

Quantification of the risks accounted for 

in setting power rates; the electricity 

market price forecast used in setting 

power rates; and the set of risk 

mitigation measures to include in rates 

that ensure that power rates meet the 

established TPP. The TPP is a measure 

of the probability that BPA will make its 

Treasury payments on time and in full 

during the rate period. If the TPP is 

below BPA’s two-year 95 percent 

standard, a combination of risk 

mitigation tools is proposed to meet the 

TPP standard. 

The electricity market price forecast 

portion of the study explains and 

documents forecasts of the variable cost 

of the marginal resource for transactions 

in the wholesale energy market. The 

specific market used in this analysis is 

the Mid-Columbia trading hub in the 

State of Washington, although this 

forecast is influenced by conditions in 

other regions within the Western 

Interconnection. The Power Risk and 

Market Price Study also explains and 

documents the natural gas price forecast 

used in setting rates. 

5. Generation Inputs Study 

The Generation Inputs Study includes 

the study and documentation for 

generation inputs costs and other interbusiness line costs. The study also 

includes the development and design of 

the proposed ACS–12 Ancillary and 

Control Area Services rate schedule, 

which had been issued in a separate 

study starting with the 2010 rate 

proceeding. The forecasts for balancing 

reserve capacity to provide regulation 

and frequency response, variable energy 

resource balancing service, dispatchable 

energy resource balancing service, 

operating reserve, and load following 

are explained and documented in the 

Generation Inputs Study. The Study 

explains and documents the embedded 

and variable cost methodologies for 

these balancing reserve capacity 

obligations and the resulting revenue 

credits reflected in the power rates. The 

proposed design for rates under the 

ACS–12 rate schedule is also described. 

6. Related Studies in the REP–12 

Proceeding 

The following studies will be 

described in the REP–12 notice in the 

Federal Register and will be included as 

part of the initial proposal in that 

proceeding. 

REP Settlement Evaluation and 

Analysis Study. 

Section 7(b)(2) Rate Test Study. 

Lookback Recovery and Return. 

Part V—Proposed 2012 Rate Schedules 

BPA’s proposed 2012 Power Rate 

Schedules are a part of this notice and 

are available for viewing and 

downloading on BPA’s Web site at 

http://www.bpa.gov/corporate/ratecase/ 

2012/. Copies of the proposed rate 

schedules also are available for viewing 

in BPA’s Public Reference Room at the 

BPA Headquarters, 1st Floor, 905 NE. 

11th Avenue, Portland, OR 97232. 

Issued this 12th day of November, 2010. 

David J. Armstrong, 

Acting Deputy Administrator. 

[FR Doc. 2010–29090 Filed 11–17–10; 8:45 am] 

BILLING CODE 6450–01–P 

DEPARTMENT OF ENERGY 

Federal Energy Regulatory 

Commission 

[Project No. 12690–003] 

Public Utility District No. 1 of 

Snohomish County, WA; Notice of 

Teleconference 

November 10, 2010. 

a. Date and Time of Meeting: Monday, 

November 15, 2010 starting at 12 p.m. 

and ending by 2 p.m. (Eastern Standard 

Time). 

b. FERC Contact: David Turner, (202) 

502–6091 or david.turner@ferc.gov. 

c. Purpose of Meeting: Commission 

staff will meet with the Snohomish 

County Public Utility District (District) 

to clarify the Commission’s August 6, 

2010, request for additional information 

on the District’s draft license 

application for the Admiralty Inlet Pilot 

Tidal Project, which would be located 

in the Puget Sound, in Washington. 

d. If you would like to attend the 

meeting or have any questions, contact 

David Turner via e-mail by November 

11, 2010. 

Kimberly D. Bose, 

Secretary. 

[FR Doc. 2010–29060 Filed 11–17–10; 8:45 am] 

BILLING CODE 6717–01–P 

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