[Federal Register Volume 65, Number 238 (Monday, December 11, 2000)]
[Notices]
[Pages 77368-77372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-31442]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Formula Rates for the Central Arizona Project 115-kV/230-kV 
Transmission System--Rate Order No. WAPA-88

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of rate order.

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SUMMARY: Notice is given of the confirmation and approval by the Deputy 
Secretary of the Department of Energy (DOE) of Rate Order No. WAPA-88 
and Rate Schedules CAP-FT1, CAP-NFT1, and CAP-NITS1 placing Formula 
Rates for firm point-to-point transmission service, nonfirm point-to-
point transmission service, and Network Integration Transmission 
Service (NITS) on the Central Arizona Project (CAP) 115-kV/230-kV 
transmission system of the Western Area Power Administration (Western) 
into effect on an interim basis. The Formula Rates will remain in 
effect on an interim basis until the Federal Energy Regulatory 
Commission (FERC) confirms, approves, and places them into effect on a 
final basis or until they are replaced by other rates. The Formula 
Rates will provide sufficient revenue to pay all annual costs, 
including interest expense, and repayment of required investment within 
the allowable period.

DATES: The Formula Rates will be placed into effect on an interim basis 
on January 1, 2001, and will be in effect until FERC confirms, 
approves, and places the Formula Rates in effect on a final basis for a 
5-year period ending December 31, 2005, or until superseded.

FOR FURTHER INFORMATION CONTACT: Mr. Maher Nasir, Rates Team Lead, 
Desert Southwest Customer Service Region, Western Area Power 
Administration, P.O. Box 6457, Phoenix, AZ 85005-6457, telephone (602) 
352-2768, or by e-mail: <a href="/cdn-cgi/l/email-protection#204e4153495260574150410e474f56"><span class="__cf_email__" data-cfemail="f896998b918ab88f998899d69f978e">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: The CAP 115-kV/230-kV transmission system 
has been used primarily to provide power to the CAP water pumps. The 
planned construction of a number of independent powerplants in Arizona 
and Nevada creates a potential demand for use of surplus transmission 
capacity on the CAP 115-kV/230-kV transmission system.
    The proposed Formula Rates for point-to-point transmission service 
and NITS on the CAP 115-kV/230-kV transmission system are based on a 
revenue requirement that recovers costs for facilities associated with 
providing transmission service and the non-facilities costs allocated 
to transmission service. The rates for point-to-point transmission 
service on the CAP 115-kV/230-kV transmission system are determined by 
combining the average annual amortization costs with the average annual 
operations and maintenance costs, and dividing them by the average 
annual contract rate of delivery for the cost evaluation period FY 
2001-FY 2005. Implementing the proposed Formula Rates results in a firm 
point-to-point CAP 115-kV/230-kV transmission system rate of $9.83 per 
kilowattyear and a nonfirm point-to-point CAP 115-kV/230-kV 
transmission system rate of 1.12 mills/kWh.
    NITS allows a transmission customer to integrate, plan, 
economically dispatch, and regulate its network resources to serve its 
native load in a way comparable to that used by the transmission 
provider to service its native load customers. The monthly charge 
methodology for NITS on the CAP 115-kV/230-kV transmission system is 
the product of the transmission customer's load-ratio share times one-
twelfth of the annual transmission revenue requirement. The customer's 
load-ratio share is calculated on a rolling 12-month basis (12CP). The 
customer's load-ratio share is equal to that customers' hourly load 
coincident with the CAP 115-kV/230-kV transmission system monthly 
transmission system peak divided by the resultant value of the CAP 115-
kV/230-kV transmission system's monthly transmission system peak minus 
the CAP 115-kV/230-kV transmission system's coincident peak for all 
firm point-to-point transmission service plus the CAP 115-kV/230-kV 
transmission system's firm point-to-point transmission service 
reservations.
    The Formula Rates for transmission service on the CAP 115-kV/230-kV 
transmission system are being developed pursuant to the Department of 
Energy Organization Act (42 U.S.C. 7101-7352), through which the power 
marketing functions of the Secretary of the Interior and the Bureau of 
Reclamation under the Reclamation Act of 1902 (ch. 1093, 32 Stat. 388), 
as amended and supplemented by subsequent enactments, particularly 
section 9(c) of the Reclamation Project Act of 1939 (43 U.S.C. 
485h(c)), and other acts specifically applicable to the project 
involved, were transferred to and vested in the Secretary of Energy.
    By Amendment No. 3 to Delegation Order No. 0204-108, published 
November 10, 1993 (58 FR 59716), the Secretary of Energy delegated (1) 
the authority to develop long-term power and transmission rates on a 
nonexclusive basis to Western's Administrator; and (2) the authority to

[[Page 77369]]

confirm, approve, and place into effect on a final basis, to remand, or 
to disapprove such rates to the FERC. In Delegation Order No. 0204-172, 
effective November 24, 1999, the Secretary of Energy delegated the 
authority to confirm, approve, and place such rates into effect on an 
interim basis to the Deputy Secretary.
    Existing Department of Energy procedures for public participation 
in power and transmission rate adjustments are located at 10 CFR part 
903, effective on September 18, 1985 (50 FR 37835), and have been 
followed by Western in the development of these provisional rates.
    Rate Order No. WAPA-88, confirming, approving, and placing the 
proposed CAP 115-kV/230-kV transmission system Formula Rates into 
effect on an interim basis, is issued; and the new Rate Schedules CAP-
FT1, CAP-NFT1, and CAP-NITS1 will be submitted promptly to FERC for 
confirmation and approval on a final basis.

    Dated: November 30, 2000.
T.J. Glauthier,
Deputy Secretary.

Order Confirming, Approving, and Placing the Central Arizona 
Project Transmission System Formula Rates into Effect on an Interim 
Basis

    These Formula Rates are developed pursuant to the Department of 
Energy Organization Act (42 U.S.C. 7101-7352), through which the power 
marketing functions of the Secretary of the Interior and the Bureau of 
Reclamation under the Reclamation Act of 1902 (ch. 1093, 32 Stat. 388), 
as amended and supplemented by subsequent enactments, particularly 
section 9(c) of the Reclamation Project Act of 1939 (43 U.S.C. 
485h(c)), and other acts specifically applicable to the project 
involved, were transferred to and vested in the Secretary of Energy.
    By Amendment No. 3 to Delegation Order No. 0204-108, published 
November 10, 1993 (58 FR 59716), the Secretary of Energy delegated (1) 
the authority to develop long-term power and transmission rates on a 
nonexclusive basis to the Administrator of the Western Area Power 
Administration (Western); and (2) the authority to confirm, approve, 
and place into effect on a final basis, to remand, or to disapprove 
such rates to the Federal Energy Regulatory Commission (FERC). In 
Delegation Order No. 0204-172, effective November 24, 1999, the 
Secretary of Energy delegated the authority to confirm, approve, and 
place such rates into effect on an interim basis to the Deputy 
Secretary. Existing Department of Energy (DOE) procedures for public 
participation in power rate adjustments are found in 10 CFR part 903. 
Procedures for approving Power Marketing Administration rates by FERC 
are found in 18 CFR part 300.

Acronyms and Definitions

    As used in this rate order, the following acronyms and definitions 
apply:

Administrator: The Administrator of the Western Area Power 
Administration (Western).
Capacity: The rated continuous electric load-carrying capability of a 
generator, transformer, transmission circuit, or other equipment. It is 
expressed in kW.
Central Arizona Project (CAP): One of three related water development 
projects that make up the Colorado River Basin Project.
Customer: An entity with a contract and receiving service from 
Western's Desert Southwest Region or from CAP.
DOE: United States Department of Energy.
DOE Order RA 6120.2: An order dealing with power marketing 
administration financial reporting and rate-making procedures.
Energy: Measured in terms of the work it is capable of doing over a 
period of time. It is expressed in kWh.
FERC: Federal Energy Regulatory Commission.
Firm: A type of product and/or service that is available at the time 
requested by the customer.
Formula Rates: A rate which is based upon a formula calculated yearly.
FY: Fiscal year; October 1 to September 30.
kV: Kilovolt--the electrical unit of measure of electric potential that 
equals 1,000 volts.
kW: Kilowatt--the electrical unit of capacity that equals 1,000 watts.
kWmonth: Kilowattmonth--the electrical unit of the monthly amount of 
capacity.
kWh: Kilowatthour--the electrical unit of energy that equals 1,000 
watts in 1 hour.
Mill: A monetary denomination of the United States that equals one 
tenth of a cent or one thousandth of a dollar.
NEPA: National Environmental Policy Act of 1969 (42 U.S.C. 4321, et 
seq.).
Nonfirm: A type of product and/or service that is not always available 
at the time requested by the customer.
O&M: Operation and maintenance.
Power: Capacity and energy.
Reclamation: United States Department of the Interior, Bureau of 
Reclamation.
Revenue Requirement: The revenue required to recover O&M expenses, 
transmission service expenses, interest, deferred expenses, and 
repayment of Federal investments, or other assigned costs.

Effective Date

    The new rates will become effective on an interim basis on the 
first day of the first full billing period beginning on or after 
January 1, 2001, and will be in effect pending FERC's approval of them 
or substitute rates on a final basis for a 5-year period ending 
December 31, 2005, or until superseded.

Public Notice and Comment

    Existing Department of Energy procedures for public participation 
in power and transmission rate adjustments, 10 CFR part 903, have been 
followed by Western in the development of these rates. The following 
summarizes the steps Western took to ensure involvement of interested 
parties in the rate process:
    1. The proposed rate adjustment was initiated on May 23, 2000, when 
a letter announcing the first informal customer information forum was 
mailed to all Central Arizona Project (CAP) customers and interested 
parties. The first informal customer information forum was held on June 
7, 2000, at the Desert Southwest Customer Service Regional office (DSW) 
in Phoenix, Arizona. At the informal customer information forum, 
Western and Reclamation staff explained the rationale for the rate 
adjustment, presented rate designs and methodologies, and answered 
questions.
    2. A Federal Register notice was published on May 24, 2000 (65 FR 
33541), officially announcing the proposed rates for the CAP 115-kV/
230-kV transmission system, initiating the public consultation and 
comment period, and announcing the public information and public 
comment forums.
    3. On June 7, 2000, a brochure prepared by Western's DSW office was 
provided to all CAP firm transmission customers and interested parties, 
included in the Federal Register notice of May 24, 2000, and announced 
the times and locations for the two public forums.
    4. On June 16, 2000, beginning at 10 a.m. MST, the public 
information forum was held at Western's DSW office in Phoenix, Arizona. 
At the public information forum, Western provided detailed explanations 
of the proposed Formula Rates for the CAP 115-kV/230-kV transmission 
system and provided a list of issues that could change the proposed 
rates, and answered questions.

[[Page 77370]]

Notice was given that additional information would be provided at the 
public comment forum. An information handout was provided at the forum.
    5. On July 17, 2000, beginning at 10 a.m., the public comment forum 
was held at Western's DSW office in Phoenix, Arizona. At the start of 
the forum, Western gave the public an opportunity to comment for the 
record. Three customer representatives were present and declined to 
make oral comments.
    6. Two comment letters were received during the consultation and 
comment period. The consultation and comment period ended August 22, 
2000. All formally submitted comments have been considered in the 
preparation of this rate order.

Project Description

    The CAP is one of three related water development projects that 
make up the Colorado River Basin Project. The others are the Dixie and 
the Upper Basin projects. The CAP was developed for Arizona and western 
New Mexico; the Dixie Project for southeastern Utah; and the Upper 
Basin Project for Colorado and New Mexico.
    Congress authorized the project in 1968 to improve water resources 
in the Colorado River Basin. Segments of the 1968 authorization allowed 
Federal participation in the Navajo Generating Station, which has three 
coal-fired steam electric generating units for a combined capacity of 
2,250 MW. Construction of the plant, located near Lake Powell at Page, 
Ariz., began in 1970. Navajo began generating in 1976.
    The Federal share of 24.3 percent, or 546,750 kW, is used to power 
the pumps that move Colorado River water through CAP canals. Surplus 
generation is currently marketed under the Navajo Power Marketing Plan 
adopted on Dec. 1, 1987.

Revenue Requirement

    The Revenue Requirement will be calculated each fiscal year to 
determine if transmission revenues will be sufficient to pay, within 
the prescribed time periods, all costs assigned to the CAP 115-kV/230-
kV transmission system function. Repayment criteria is based on law, 
policies, and authorizing legislation, including DOE Order RA 6120.2.

Certification of Rate

    Western's Administrator has certified that the Formula Rates for 
transmission service on the CAP 115-kV/230-kV transmission system, 
placed into effect on an interim basis herein, are the lowest possible 
rates consistent with sound business principles, and have been 
developed in accordance with administrative policies and applicable 
laws.

Discussion

    The CAP 115-kV/230-kV transmission system has been used primarily 
to provide power to the CAP water pumps. The planned construction of a 
number of independent powerplants in Arizona and Nevada creates a 
potential demand for use of surplus transmission capacity on the CAP 
115-kV/230-kV transmission system.
    The proposed Formula Rates for point-to-point transmission service 
and NITS on the CAP 115-kV/230-kV transmission system are based on a 
Revenue Requirement that recovers costs for facilities associated with 
providing transmission service and for non-facilities allocated to 
transmission service.

Point-to-Point Transmission Service

    The rate for firm point-to-point transmission service on the CAP 
115-kV/230-kV transmission system is determined by combining the annual 
amortization costs with the annual operations and maintenance costs, 
and dividing them by the annual average contract rate of delivery. The 
nonfirm rate is determined by converting the firm annual rate into an 
hourly rate. Implementing the proposed rate formulas results in a firm 
point-to-point CAP 115-kV/230-kV transmission system rate of $9.83 per 
kilowattyear and a nonfirm point-to-point CAP 115-kV/230-kV 
transmission system rate of 1.12 mills/kWh.

Network Integration Transmission Service

    NITS allows a transmission customer to integrate, plan, 
economically dispatch, and regulate its network resources to serve its 
native load in a way comparable to how a transmission provider uses its 
own transmission system to service its native load customers. The 
monthly charge methodology for NITS on the CAP 115-kV/230-kV 
transmission system is the product of the transmission customer's load-
ratio share times one-twelfth of the annual transmission revenue 
requirement. The customer's load-ratio share is calculated on a rolling 
12-month basis (12CP). The customer's load-ratio share is equal to that 
customers' hourly load coincident with the CAP 115-kV/230-kV 
transmission system's monthly transmission system peak divided by the 
resultant value of the CAP 115-kV/230-kV transmission system's monthly 
transmission system peak minus the CAP 115-kV/230-kV transmission 
system coincident peak for all firm point-to-point transmission service 
plus the CAP 115-kV/230-kV transmission system's firm point-to-point 
transmission service reservations. In order to ensure the collection of 
the transmission system's annual revenue requirement, the difference 
between the first two components of the resultant value outlined above 
constitutes the network transmission systems' monthly peak and is 
anticipated to be metered. Thus, a NITS customer, based on its 12-CP 
load, will pay its proportionate share of the revenue requirement for 
the month. Since point-to-point transmission service customers are 
charged on a reservation basis and not a usage basis, for the purpose 
of determining the NITS charge, the transmission system's monthly peak 
will coincide with the network transmission system's monthly peak.

Ancillary Service

    The proposed revenue requirement includes the costs for scheduling, 
system control, and dispatch service. The reactive supply and voltage 
control ancillary service must be purchased from the Western Area Lower 
Colorado (WALC) control area. The transmission customer may self-supply 
the four remaining ancillary services or request them from WALC. These 
four ancillary services are regulation and frequency response service, 
energy imbalance service, spinning reserve service, and supplemental 
reserve service.

Statement of Revenue and Related Expenses

    The following table provides a summary of revenues and expenses for 
the 5-year provisional rate period.

                          Revenues and Expenses
                        [In thousands of dollars]
------------------------------------------------------------------------
                                                                Formula
                                                               rates \1\
------------------------------------------------------------------------
      Total Revenues........................................      34,429
                                                             -----------
Revenue Distribution:
  O&M.......................................................       6,763
  Purchase Power............................................           0
  Transmission..............................................           0
  Interest..................................................      19,343
  Other.....................................................           0
  Investment Repayment......................................       8,323
  Capitalized Expenses......................................           0
  Prior-Year Adjustment.....................................          0
------------------------------------------------------------------------
<SUP>1</SUP> The revenues and expenses for the Formula Rates are for 5 years.

Basis for Rate Development

    This proposed rate adjustment is needed to put into place, for the 
first

[[Page 77371]]

time, rate formulas to calculate the rate to be charged for the sale of 
surplus transmission capacity on the CAP 115-kV/230-kV transmission 
system. The assessed calculated rates will provide sufficient revenue 
to pay all annual costs, including interest expense, and repayment of 
required investment within the allowable period. The Formula Rates are 
scheduled to go in effect on January 1, 2001, and will remain in effect 
through December 31, 2005.

Comments

    During the public consultation and comment period, Western received 
two written comment letters on the rate adjustment. All comments 
received by the end of the public consultation and comment period, 
August 22, 2000, were reviewed and considered in the preparation of 
this rate order.
    Written comments were received from the following sources: Central 
Arizona Project, August 21, 2000, Robert S. Lynch, Attorney at Law, 
August 22, 2000.
    The comments received dealt with the disposition of revenues 
derived from the assessment of the CAP 115-kV/230-kV transmission 
system rates and its applicability to the Lower Colorado River Basin 
Development Fund (LCRBDF). All comments supported Western's efforts to 
establish the new CAP 115-kV/230-kV transmission system rates. The 
following is a summary of the comments received by the end of the 
consultation and comment period and Western's response to those 
comments.
    Comment: Both commentors stated that there are significant 
unresolved issues regarding the disposition of any revenues received 
from Western's marketing of CAP transmission service, and that any 
revenues received should be applied in the following manner. The annual 
amortization cost component of the CAP rate should be deposited in the 
LCRBF and applied to the CAP capital investment, however, revenues 
derived from the operation and maintenance cost component of the CAP 
transmission rate should be used to offset amounts otherwise due from 
the Central Arizona Water Conservation District (CAWCD).
    Response: Western agrees in concept with the commentors and upon 
approval of the provisional rates Western will evaluate its authority 
and ability to disburse revenues in the manner similar to that 
suggested by the commentor. Western will not double collect its 
operation and maintenance cost component through rates and through 
CAWCD trust funds.

Environmental Compliance

    In compliance with the National Environmental Policy Act of 1969 
(NEPA) (42 U.S.C. 4321, et seq.); Council on Environmental Quality 
Regulations (40 CFR parts 1500-1508); and DOE NEPA Regulations (10 CFR 
part 1021), Western has determined that this action is categorically 
excluded from the preparation of an environmental assessment or an 
environmental impact statement.

Determination Under Executive Order 12866

    Western 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.

Regulatory Flexibility Analysis

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612, et seq.) 
requires Federal agencies to perform a regulatory flexibility analysis 
if a final rule is likely to have a significant economic impact on a 
substantial number of small entities and there is a legal requirement 
to issue a general notice of proposed rulemaking. Western has 
determined that this action does not require a regulatory flexibility 
analysis since it is a rulemaking of particular applicability involving 
rates or services applicable to public property.

Small Business Regulatory Enforcement Fairness Act

    Western has determined that this rule is exempt from congressional 
notification requirements under 5 U.S.C. 801 because the action is a 
rulemaking of particular applicability relating to rates or services 
and involves matters of procedure.

Availability of Information

    Information regarding this rate adjustment, including the repayment 
studies, comments, letters, memorandums, and other supporting material 
made or kept by Western for the purpose of developing the Formula 
Rates, is available for public review in the Office of the Power 
Marketing Manager, Desert Southwest Customer Service Regional Office, 
Western Area Power Administration, 615 South 43rd Avenue, Phoenix, 
Arizona.

Submission to the Federal Energy Regulatory Commission

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

Order

    In view of the foregoing and pursuant to the authority delegated to 
me by the Secretary of Energy, I confirm and approve on an interim 
basis, effective January 1, 2001, Formula Rates under Rate Schedules 
CAP-NFT1, CAP-NFT1, and CAP-NITS1 for the Central Arizona Project 115-
kV/230-kV transmission system of the Western Area Power Administration. 
The Formula Rates under the rate schedules shall remain in effect on an 
interim basis, pending FERC confirmation and approval of them or 
substitute rates on a final basis through December 31, 2005.

    Dated: November 30, 2000.

T.J. Glauthier,
Deputy Secretary.

Central Arizona Project

Schedule of Rate(s) for Firm Point-to-Point Cap 115-kV/230-kV 
Transmission Service

[Rate Schedule CAP-FT1]

    Effective: The first day of the first full billing period beginning 
on or after January 1, 2001, through December 31, 2005.
    Available: In the marketing area served by the Central Arizona 
Project (CAP) 115-kV/230-kV transmission system.
    Applicable: The transmission service customers shall compensate the 
CAP where firm capacity and energy are supplied to the CAP 115-kV/230-
kV transmission system at points of interconnection with other systems 
and transmitted and delivered, less losses, to points of delivery on 
the CAP 115-kV/230-kV system specified in the service contract. The 
formula for the annual revenue requirement used to calculate the 
charges for this firm service under this schedule was promulgated and 
may be modified pursuant to applicable Federal laws, regulations, and 
policies. The Desert Southwest Customer Service Region (DSW) may modify 
the charges for firm point-to-point transmission service upon written 
notice to the transmission customer. Any change to the charges to the 
transmission customer for firm point-to-point transmission, shall be as 
set forth in a revision to this rate schedule promulgated pursuant to 
applicable Federal laws, regulations, and policies and made part of the 
applicable service contract. DSW shall charge the transmission customer 
in accordance with the revenue requirements then in effect.
    Character and Conditions of Service: Alternating current at 60 
Hertz, three-phase, delivered and metered at the

[[Page 77372]]

voltages and points of delivery established by contract over the CAP 
115-kV/230-kV transmission system.
    Formula Rate For Firm Point-to-Point Transmission Service:

Annual Rate = Five Year Average Annual Revenue Requirement divided by 
the Five Year Average Contract Rate of Delivery, rounded to the penny.
Monthly Rate = Annual Rate divided by 12, rounded to the penny.

    Calculated Rates: For FY 2001, the annual firm rate calculates to 
$9.83 per kWyear, and the monthly firm rate calculates to $0.82 per 
kWmonth. Based on updated financial and load data, recalculated rates 
will go into effect on January 1 of each year during the effective rate 
schedule period.

Adjustments

    For Reactive Power: There shall be no entitlement to transfer of 
reactive kilovoltamperes at delivery points, except when such transfers 
may be mutually agreed upon by contractor and contracting officer or 
their authorized representatives.
    For Losses: Capacity and energy losses incurred in connection with 
the transmission and delivery of capacity and energy under this rate 
schedule shall be supplied by the customer in accordance with the 
service contract.
    Billing for Unauthorized Overruns: For each billing period in which 
there is a contract violation involving an unauthorized overrun of the 
contractual firm transmission obligations, such overrun shall be billed 
at 10 times the above rates.

Central Arizona Project

Schedule of Rate(s) for Nonfirm Point-to-Point Cap 115-kV/230-kV 
Transmission Service

[Rate Schedule CAP-FT1]

    Effective: The first day of the first full billing period beginning 
on or after January 1, 2001, through December 31, 2005.
    Available: In the marketing area served by the Central Arizona 
Project 115-kV/230-kV transmission system.
    Applicable: The transmission service customer shall compensate the 
Central Arizona Project (CAP) for nonfirm point-to-point transmission 
service where capacity and energy are supplied to the CAP 115-kV/230-kV 
transmission system at points of interconnection with other systems, 
transmitted subject to the availability of the transmission capacity, 
and delivered less losses, to points of delivery on the CAP 115-kV/230-
kV system specified in the service contract.
    Character and Conditions of Service: Alternating current at 60 
Hertz, three-phase, delivered and metered at the voltages and points of 
delivery established by contract over the CAP 115-kV/230-kV 
transmission system.
    Formula Rate for Nonfirm Point-to-Point Transmission Service: 
Nonfirm Point-To-Point Transmission Service Rate: Each Contractor shall 
be billed monthly a mills per kilowatthour rate of scheduled or 
delivered kilowatthours at point of delivery, established by contract, 
payable monthly. This rate is equal to the CAP 115-kV/230-kV Firm 
Transmission dollar per kilowatt-year rate then in effect divided by 
8,760, multiplied by 1,000, rounded to two decimal places.
    Calculated Rate: For FY 2001, the nonfirm rate calculates to 1.12 
mills/kWh. Based on updated financial and load data, a recalcualted 
rate will go into effect on January 1 of each year during the effective 
rate schedule period.

Adjustments

    For Reactive Power: There shall be no entitlement to transfer of 
reactive kilovoltamperes at delivery points, except when such transfers 
may be mutually agreed upon by contractor and contracting officer or 
their authorized representatives.
    For Losses: Capacity and energy losses incurred in connection with 
the transmission and delivery of capacity and energy under this rate 
schedule shall be supplied by the customer in accordance with the 
service contract.

Central Arizona Project

Schedule of Rate(s) for Network Integration Transmission Service

[Rate Schedule CAP-NITS1

    Effective: The first day of the first full billing period beginning 
on or after January 1, 2001, through December 31, 2005.
    Applicable: The transmission customer shall compensate the Central 
Arizona Project (CAP) each month for Network Integration Transmission 
Service (NITS) pursuant to the applicable Network Integration 
Transmission Service Agreement and annual revenue requirement referred 
to below. The formula for the annual revenue requirement used to 
calculate the charges for this service under this schedule was 
promulgated and may be modified pursuant to applicable Federal laws, 
regulations, and policies.
    The Desert Southwest Customer Service Region (DSW) may modify the 
charges for NITS upon written notice to the transmission customer. Any 
change to the charges to the transmission customer for NITS shall be as 
set forth in a revision to this rate schedule promulgated pursuant to 
applicable Federal laws, regulations, and policies and made part of the 
applicable service agreement. DSW shall charge the transmission 
customer in accordance with the revenue requirement then in effect.
    Formula Rate:

Monthly Charge = Transmission Customer's Load-Ratio Share  x  (Revenue 
Requirement/12)

    Calculated Rate: The projected annual revenue requirement for FY 
2001 for the CAP 115-kV/230-kV transmission system is $6,556,547. Based 
on updated financial and load data, a recalculated revenue requirement 
will go into effect on January 1 of each year during the effective rate 
schedule period.

[FR Doc. 00-31442 Filed 12-8-00; 8:45 am]
BILLING CODE 6450-01-P


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