[Federal Register Volume 63, Number 3 (Tuesday, January 6, 1998)]
[Notices]
[Pages 521-559]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-128]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Open Access Transmission Service Tariff

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of final Tariff.

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SUMMARY: The Western Area Power Administration (Western) is adopting 
this final Open Access Transmission Service Tariff (Tariff) in order to 
be consistent with the Federal Energy Regulatory Commission (FERC) 
Order Nos. 888 and 888-A to the extent consistent with laws applicable 
to Western's activities.

DATES: The Tariff will become effective February 5, 1998. The Tariff 
will remain in effect until superseded.

FOR FURTHER INFORMATION CONTACT:
Mr. Robert J. Harris, Power Marketing Manager, Upper Great Plains 
Region, Western Area Power Administration, P.O. Box 35800, Billings, MT 
59107-5800; (406) 247-7394
Mr. Dave Sabo, CRSP Manager, CRSP Customer Service Center, Western Area 
Power Administration, P.O. Box 11606, Salt Lake City, UT 84147-0606; 
(801) 524-5493
Mr. Anthony H. Montoya, Power Marketing Manager, Desert Southwest 
Region, Western Area Power Administration, P.O. Box 6457, Phoenix, AZ 
85005-6457; (602) 352-2789
Mr. James D. Keselburg, Power Marketing Manager, Rocky Mountain Region, 
Western Area Power Administration, P.O. Box 3700, Loveland, CO 80539-
3003; (970) 490-7370
Ms. Zola Jackson, Power Marketing Manager, Sierra Nevada Region, 
Western Area Power Administration, 114 Parkshore Drive, Folsom, CA 
95630-4710; (916) 353-4421
Mr. Robert Fullerton, Corporate Communications Office, Western Area 
Power Administration, Post Office Box 3402, Golden, CO 80401-0098; 
(303) 275-2700.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Procedures
II. Background
III. Comments Raised During the Development of this Final Tariff
IV. Summary of Significant Changes from Western's Proposed Tariff
V. Coordination with Adoption of Open Access Transmission Rates
VI. Regulatory Requirements

I. Procedures

    Western will submit the final Tariff to FERC under a non-
jurisdictional docket and will request a declaratory order that the 
Tariff meets FERC comparability standards as set forth in FERC Order 
Nos. 888 and 888-A. Western will make the necessary changes in response 
to the FERC declaratory order and will publish the revised final Tariff 
in the Federal Register.

II. Background

    Use of transmission facilities that Western owns, operates, or to 
which it has contract rights for delivery of Federal long-term firm 
capacity and energy to project use and electric service customers is a 
Western responsibility under the terms and conditions of marketing 
criteria and electric service contracts implementing statutory 
obligations to market Federal power. This is complementary with the 
provisions of the Tariff. Transmission service provided by Western 
under the Tariff is solely for the use of available transmission 
capability in excess of the

[[Page 522]]

amount Western requires for the delivery of long-term firm capacity and 
energy to project use and electric service customers of the Federal 
government. Western will offer to provide others transmission service 
equivalent to the service Western provides itself.
    Western was established on December 21, 1977, pursuant to Section 
302 of the Department of Energy (DOE) Organization Act, Public Law 95-
91, dated August 4, 1977. Western's primary and long-standing mission 
is to market Federal power resources with emphasis on maintaining an 
efficient and reliable power system. Western is a power supplier that 
markets and transmits Federal power resources in 15 Central and Western 
States encompassing a geographic area of 3.38 million-square-kilometers 
(1.3 million-square-miles). Western has four Customer Service Regional 
Offices and the Colorado River Storage Project Customer Service Center 
(CRSP CSC), each referred to in the Tariff as a Regional Office. 
Western markets power and provides transmission service from various 
multi-purpose hydroelectric projects.
    Western is not a public utility under Sections 205 and 206 of the 
Federal Power Act and is not specifically subject to the requirements 
of the FERC Order Nos. 888 and 888-A. Western is a transmitting utility 
subject to Section 211 of the Federal Power Act as amended by the 
Energy Policy Act of 1992.
    FERC issued a Notice of Proposed Rulemaking (NOPR) for Open Access 
Transmission Service, published at 60 FR 17662, on April 7, 1995. On 
October 4, 1995, the Secretary of DOE adopted a Power Marketing 
Administration Open Access Transmission Policy which stated that DOE 
supported the spirit and intent of the NOPR. The Secretary of DOE 
stated that the Power Marketing Administrations would comply with the 
principles set forth in the FERC's final rule to the extent consistent 
with applicable law. FERC issued its final rule, Order No. 888, 
published at 61 FR 21540 on May 10, 1996, and followed with Order No. 
888-A, published at 62 FR 12273, on March 14, 1997.
    In early 1996, Western began developing a Tariff Equivalent Package 
(TEP) to comply with the Secretary's directive. A draft TEP, which was 
designed as a Western-wide document that would contain Region-specific 
rates and charges, was completed in July 1996 and sent to Western's 
electric service customers, transmission-service customers, and other 
interested parties for review and comment. Western accepted comments on 
the TEP through November 1996.
    After evaluating comments, Western modified its original concept of 
preparing a Western-wide TEP and began developing Regional Open Access 
Transmission Service Guidelines (Regional Guidelines). These Regional 
Guidelines contained service agreements consistent with the specific 
conditions applicable to each Region. The resulting documents were sent 
to electric service customers, transmission customers, and other 
interested parties for review and comment in April 1997. The review 
period for those documents ended in early June 1997. Customer and 
interested party participation was conducted informally.
    Western began its formal process of developing this Tariff when it 
issued a Notice of Proposed Tariff published at 62 FR 50572 on 
September 26, 1997. A formal comment period lasted for 31 days. On 
October 7, 1997, Western held a combined public information and public 
comment forum. The comments received during the comment period were 
considered in developing this final Tariff.
    Western will submit the Tariff document to FERC under a non-
jurisdictional docket and request a declaratory order from FERC that 
this Tariff meets the FERC comparability standards as set forth in FERC 
Order Nos. 888 and 888-A. Consistent with a single FERC filing, Western 
has developed and will file this Tariff with appended schedules and 
attachments. Western's Tariff includes Attachment J, Provisions 
Specific to the Transmission Provider, and Attachment K, Authorities 
and Obligations, which are specific to Western and are not found in 
FERC's pro forma tariff.
    By law, the Bureau of Reclamation (Reclamation) provides Federal 
power resources to its project use customers. By law, Western markets 
Federal power resources to its electric service customers. Western's 
transmission system was built primarily to enable the delivery of 
Federal power to satisfy these contractual obligations. Western's 
Regional Offices reserved transmission capacity shall, therefore, 
include capacity sufficient to deliver Federal power resources to 
customers of the Federal government. Nothing in this Tariff shall 
alter, amend, or abridge the statutory or contractual obligations of 
Western to market and deliver Federal power resources and to repay the 
Federal investment in such projects. This Tariff provides for 
transmission, including each Regional Office's use of those facilities 
for third party sales, on the unused capacity of transmission 
facilities under the jurisdiction or control of each of Western's 
Regional Offices not required for the delivery of long-term firm 
capacity and energy to customers of the Federal government in a manner 
consistent with the spirit and intent of FERC Order Nos. 888 and 888-A.
    Western has prepared this Tariff and service agreements to provide 
transmission service comparable to that required of public utilities by 
FERC Order Nos. 888 and 888-A, and to implement those Orders consistent 
with the DOE Policy. An entity desiring transmission service from 
Western must comply with the application procedures outlined herein. 
The review and approval requirements detailed herein will apply to all 
requesting parties. Western will perform the necessary studies or 
assessments for evaluating requests for transmission service as set 
forth in this Tariff. Any facility construction or interconnection 
necessary to provide transmission service will be subject to Western's 
General Requirements for Interconnection which are available upon 
request.
    Western will provide Firm and Non-Firm Point-to-Point Transmission 
Service and Network Integration Transmission Service consistent with 
the Tariff. The specific terms and conditions for providing 
transmission service specific to a particular customer will be included 
in a Service Agreement. Operating Procedures, Available Transmission 
Capability (ATC), and System Impact Methodology are defined in the 
Attachments. Western's Regional Offices develop rates under separate 
public process pursuant to applicable Federal law and regulations. 
Therefore, rates and charges for specific services will be set forth in 
the appropriate Regional rates schedules attached to each Service 
Agreement.
    Western has marketed the maximum practical amount of power from 
each of its projects, leaving little or no flexibility for provision of 
additional electric services from the projects. Changes in water 
conditions frequently affect the ability of hydroelectric projects to 
meet obligations on a short-term basis. The unique characteristics of 
the hydro resource, Western's marketing plans, and the limitations of 
the resource due to changing water conditions limit Western's ability 
to provide generation-related services including ancillary services and 
redispatching, using Federal hydro resources.

[[Page 523]]

III. Comments Raised During the Development of this Final Tariff

    Participants in the formal review process raised numerous comments 
about the proposed tariff. The following highlights the more 
significant comments and Western's responses.
    Comment: A commentor stated that the ``Annual Transmission Costs'' 
definition (Section 1.2) does not appear to include the costs of the 
power produced at Reclamation's hydroelectric power facilities. The 
transmission rates do, however, indicate the need for ancillary 
generation service support. The definition should then also include 
costs associated with Reclamation's support of Ancillary Services.
    Response: It is correct that the definition for ``Annual 
Transmission Costs'' does not include the costs of the power produced 
at the hydroelectric facilities. FERC Order Nos. 888 and 888-A provide 
that only transmission costs may be included in the definition of 
``Annual Transmission Costs.''
    Comment: A commentor asked if, in Section 1.2, it is correct that 
the Annual Transmission Costs can be modified by the FERC.
    Response: FERC decisions may affect what facility costs will be 
included in Western's Annual Transmission Costs.
    Comment: A commentor asked why Western deleted the reference to 
FERC's approval in Section 1.10.
    Response: Western is not a public utility and, therefore, is not 
subject to FERC's jurisdiction under Sections 205 and 206 of the 
Federal Power Act. Western is not, therefore, required to submit 
Service Agreements to FERC for approval.
    Comment: A commentor stated that, Western, as a Transmission 
Provider, does not have retail customers, and, therefore, the word 
``retail'' should be deleted from Section 1.19.
    Response: Inclusion of this language does not establish the type of 
customer Western serves. This change is not necessary.
    Comment: A commentor asked if the definition of ``Transmission 
Provider'' in Section 1.46 includes the CRSP CSC in the context of the 
Regional Office reference.
    Response: The definition of ``Transmission Provider'' does include 
the CRSP CSC in the context of the Regional Office reference. As 
specified in Attachment K, the CRSP CSC is a Transmission Provider as 
are Western's other Regional Offices.
    Comment: A commentor requested clarification on whether Section 2.1 
indicates that existing project use loads will be included in the 
initial allocation of available transmission capacity calculations.
    Response: Section 2.1 addresses applications for transmission 
service received during the first 60 days commencing with the effective 
date of the Tariff. Section 2.1 does not address existing commitments 
for transmission. However, in response to the comment, existing project 
use loads are components in the Regional Office's calculations of ATC.
    Comment: Several commentors requested that Western delete ``to the 
extent possible'' in the second paragraph of Section 3.0, and delete 
the requirement for a separate agreement to purchase Ancillary Services 
on behalf of the transmission customer.
    Response: Western agrees and has modified Section 3.0.
    Comment: A commentor suggested that, in Section 3.0, Western should 
insert the word ``uncommitted'' before the word ``surplus.''
    Response: Western has removed the referenced sentence.
    Comment: A commentor suggested that in Section 3.0 after the 
phrase, ``Services it will purchase from the Transmission Provider'' 
that Western insert this sentence: ``Ancillary Services are included as 
part of Federal customer transmission service.''
    Response: This section applies only to transmission service 
provided under the Tariff and does not refer to existing transmission 
commitments of Western.
    Comment: A commentor suggested that within the title of Section 
5.1, replace the words ``Local Furnishing'' with the words ``Tax 
Exempt'' so that the subtitle reads ``Transmission Providers That Own 
Facilities Financed by Tax Exempt Bonds'' and make this change 
throughout the section. The commentor also suggested that in Section 
5.2(i), Western delete the words ``local furnishing.''
    Response: This issue was raised in comments to FERC as it developed 
its pro forma tariff. The result is the language in Section 5.0 of the 
pro forma tariff, which Western has adopted.
    Comment: A commentor stated that the proposed Tariff does not 
comply with FERC Order Nos. 888 and 888-A. Western's Tariff does not 
recognize an exception to comparability and reciprocal service if each 
or both would jeopardize a public power utility's tax exempt financing. 
Another commentor stated that there has not been a genuine and good 
faith effort to include the specific treatment and special requirements 
of the non-jurisdictional/non-public utilities that are expressly 
recognized and available under FERC Order Nos. 888 and 888-A.
    Response: Western has complied with FERC Order No. 888-A by 
adopting the pro forma language insofar as Western can and still comply 
with Federal law. Nothing in Western's Tariff abrogates any specific 
treatment and special requirements of the non-jurisdictional/non-public 
utilities that are expressly recognized and available under FERC Order 
Nos. 888 and 888-A. Non-public utilities seeking relief from this and 
other provisions should seek a waiver of reciprocity from FERC pursuant 
to 18 CFR 35.28(e).
    Comment: A commentor asked how the cost of System Impact Studies 
conducted on behalf of Western or its Federal customers will be shared 
between Federal customers and customers served under the Tariff.
    Response: Western will assign System Impact Study costs for 
Western's benefit in accordance with Section 8.0 of the Tariff.
    Comment: A few comments were made that, in Section 10.1, the last 
part of the added sentence states, ``* * * and shall exercise due 
diligence to remove such inability with all reasonable dispatch.'' This 
language appears to either duplicate or modify the ``all reasonable 
efforts'' language in the previous sentence. In either case, it should 
be removed.
    Response: Western agrees and has deleted the added sentence in 
Section 10.1.
    Comment: A commentor stated that Western should add the following 
language to Section 12.1, ``In the event the designated representatives 
are unable to resolve the dispute within 45 days (or such other period 
as the Parties may agree upon) the dispute may be resolved through the 
procedures specified in Section 12.2.''
    Response: Western agrees with the suggested concept and has 
modified Section 12.1 to allow external dispute resolution under 
Section 12.2 if disputes can not be resolved in 30 days.
    Comment: Several commentors stated that Western should modify the 
final Tariff to provide that the Transmission Provider; i.e., the 
appropriate Regional Office of Western, agrees to apply the dispute 
resolution process adhered to by the regional transmission group to 
which the Transmission Provider belongs.
    Response: Western agrees and has modified Section 12.2 to 
incorporate the suggested concept.
    Comment: A commentor stated that Western must include a Dispute 
Resolution Procedure in Section 12 that is binding on Basin Electric 
Power Cooperative, Inc. (BEPC) and Heartland Consumers Power District 
(HCPD).

[[Page 524]]

    Response: Western's Upper Great Plains Region (UGPR) is the 
Transmission Provider and all disputes between the Transmission 
Provider and the transmission customer will be subject to the dispute 
resolution procedures of the Tariff, thus no modifications are 
warranted. Disputes that involve only a transmission customer and 
either BEPC or HCPD could still be resolved under appropriate Mid-Area 
Continent Power Pool (MAPP) procedures whenever it involves an issue 
discrete to either and is not a part of the general Tariff provisions.
    Comment: A comment was made that Western should incorporate the 
word ``uncommitted'' in various sections of the Tariff, including 
Sections 13.5, 27.0, and 33.2.
    Response: The addition of this term could jeopardize Western's 
ability to meet FERC's test for comparability. Therefore, Western has 
not made the suggested changes.
    Comment: A commentor requested that in Sections 13.8 and 14.6 the 
reference to 10 a.m. should include a time zone; e.g., MST or PST for 
each operating area, and delete the language in the brackets.
    Response: Western adopted the language of the pro forma tariff. 
Since this is a Western-wide document, Western is unable to assign a 
time zone. Western's scheduling offices are located in three different 
time zones. The 10 a.m. reference applies to the time of the 
appropriate scheduling office from which transmission service is being 
requested.
    Comment: A commentor requested that the phrase, ``This does not 
apply to the Colorado River Front Work and Levee System or the Salinity 
transmission system'', be inserted at the end of Section 15.4.
    Response: The last sentence in Section 15.4 addresses this comment. 
The facilities identified in the comment are considered distribution 
facilities and are not subject to the Tariff. Request for service on 
these facilities will be handled on a case-by-case basis.
    Comment: Several commentors strongly encouraged the inclusion of 
transmission losses in Sections 15.7 and 28.5 of the Tariff and that 
the associated section in the applicable Service Agreements be removed, 
thus providing them with some reasonable assurance that these factors 
will be applied in a non-discriminatory and comparable manner.
    Response: Since this is a Western-wide document and transmission 
loss factors are calculated separately for each Transmission System, 
Sections 15.7 and 28.5 of the pro forma tariff were modified to allow 
the applicable transmission loss percentages to be included in the 
Regional Office specific Service Agreements. Each of Western's Regional 
Offices periodically modifies its Transmission System loss factors 
based on system losses and all of its Regional Office(s) s are subject 
to these loss factors.
    Comment: A commentor requested that Western, in Sections 17.2(iv) 
and 18.2, insert ``or other'' after ``Regional Transmission Group 
(RTG).''
    Response: The commentor's proposed language is too broad and might 
adversely affect the rights of entities that are not parties to the 
agreement. Therefore, this change was not made.
    Comment: Several commentors made the comment that Western's 
proposed application processing fees in Sections 17.3 and 29.2 are 
inconsistent with the pro forma provisions, and that the processing fee 
or at least some portion should be refunded if the request for 
transmission service is denied by Western. It is the opinion of the 
commentors that, as written, Western's processing fee procedures do not 
provide reciprocal service, and Western provides no numerical 
justification for the processing fees included in Attachment K.
    Response: The processing fee is being collected to offset those 
costs incurred by Western in processing applications for transmission 
service. These costs will be incurred irrespective of whether 
transmission service is taken, so no refunds will be made. In 
developing the processing fee, each Regional Office used the same 
method, which reflects an average of staff wages and benefits 
multiplied by the average time it takes to analyze and respond to 
requests for service. Western plans to periodically review these costs. 
FERC has previously accepted this methodology.
    Comment: A comment was made that Western should incorporate the 
phrase ``and applicable Federal law and regulations'' in Section 27.0. 
Comments were also made that Western should incorporate the phrase 
``and permitted by Federal law and regulations'' in Section 30.5. Both 
sections address redispatch procedures.
    Response: There are no Federal laws governing redispatch; however, 
Western does have certain limitations on this matter based on specific 
power marketing plans.
    Comment: A commentor recommended that Western insert 
``transmission'' in its clarifying statement at the end of Section 
28.2, so that there is no misinterpretation of the meaning of capacity.
    Response: Western agrees and has made the change.
    Comment: A commentor stated FERC's Pricing Policy provides that 
Western can only charge the higher of embedded costs or opportunity 
costs, but not the sum of the two. This FERC Pricing Policy should be 
applicable to Western, since Western agreed to abide by FERC's rate-
making policies as a condition of its membership in Southwest Regional 
Transmission Association (SWRTA).
    Response: This comment is outside the scope of this process. 
Western is meeting the rate-making policies of FERC for Federal Power 
Marketing Administrations as agreed in the SWRTA agreement.
    Comment: A commentor suggested that, in Section 30.8 in the second 
line after the word ``the'' and before ``Transmission Provider'', 
Western insert ``available capability of the''.
    Response: Western has stated in Attachment K to its Tariff that 
only excess transmission capability will be available and has found 
this change unnecessary. This excess transmission capability will be 
determined as provided in Attachment C to the Tariff.
    Comment: A commentor asked what is Federal policy as mentioned in 
Section 34.0. Is it published and who has oversight--FERC? What if it 
conflicts with FERC? The same commentor also asked what is meant by 
applicable Federal law and regulations, and is it different region-by-
region or is it consistent region-by-region? The commentor further 
asked what are Western's current applicable laws and regulations 
relating to stranded costs?
    Response: Federal policy as used in Section 34.0 includes FERC's 
policies, regulations and rulings pertaining to open access 
transmission service to the extent consistent with the body of Federal 
laws governing Western's activities. Applicable Federal law and 
regulations are the body of statutes and regulations governing the 
activities of Western as a Federal Power Marketing Administration. 
Treatment of stranded costs by Western will be governed by the 
principles contained in FERC Orders No. 888 and 888-A, related rulings 
and orders promulgated by FERC, and Western's statutory obligations as 
a Federal Power Marketing Administration.
    Comment: Several commentors made comments regarding Western's 
decision to change certain pro forma tariff sections to require advance 
payment for the cost of any necessary transmission facility additions 
and the associated studies, and provide no interest on those advances. 
There is also a concern

[[Page 525]]

that public agencies may not be able to meet the deadlines for 
providing advances of funds for Facilities Studies and New 
Construction, and that there may be improper cost shifting of Direct 
Assignment Facilities to other non-benefiting transmission customers.
    Response: The Anti-Deficiency Act, 31 U.S.C. 1341(a), and other 
appropriations laws allow Federal agencies to incur obligations and 
make expenditures only in amounts available in an appropriation or fund 
and available to the government for the purpose for which the 
appropriation or fund is budgeted. Therefore, Western will request an 
advance of funds for construction of Direct Assignment Facilities in 
the construction agreement for such facilities as described in Sections 
19.4 and 32.4. Recurring operation and maintenance costs related to 
Direct Assignment Facilities will be assessed on a periodic basis as 
set forth in the Service Agreement. This process will assure the proper 
allocation of costs among customers taking transmission. Western will 
return the unexpended portion of any funds advanced for studies or 
construction. Western is not able to pay interest on advances without 
shifting costs to other customers.
    As for certain public agencies unable to meet the deadlines for 
providing advances of funds, Western will follow the deadlines required 
in the Tariff which, in turn, are the same as those in the pro forma 
tariff. To do otherwise could impair Western's ability to meet FERC's 
requirement that all requestors be treated in a non-discriminatory 
manner.
    Comment: A commentor stated that Schedules 2 through 6 of the 
Tariff outline Western's offer to provide certain Ancillary Services as 
both the Transmission Provider and the Control Area operator. The 
commentor has no objection to these schedules if Western has available 
Ancillary Services to provide. However, the commentor is concerned that 
its generating resources and those of other parties may be used by the 
Control Area operator, Western, to provide Ancillary Services without 
compensation to the owning utilities. Of course, the opposite outcome 
could occur also. The commentor encourages Western to take the lead in 
establishing effective and practical operating measures to assure 
proper accounting for Ancillary Services. Western should also consider 
joint participation by all Control Area generators in supplying these 
services.
    Response: Western appreciates the comment and will take the lead in 
establishing effective and practical operating measures to assure 
proper accounting for these Ancillary Services.
    Comment: A few commentors stated their concern about the narrow 
bandwidth allowed for deviation from scheduled transactions contained 
in Schedule 4. One commentor believes that it will be extremely 
difficult to stay within this bandwidth because of limitations and 
errors in metering, scheduling practices, and unit control, and urges 
Western to adopt a broader deviation bandwidth, <plus-minus>3.0 percent 
at a minimum, in order to mitigate these control and scheduling 
problems. Another commentor stated that some of Western's rate 
proposals include penalties of monetary charges for deviations beyond 
the scheduling band. This commentor does not agree that a ``one size 
fits all'' band is necessary and believes that any monetary charges 
should be cost based.
    Response: Western is consistent with FERC Order Nos. 888 and 888-A 
on this service. The monetary charge is a rate issue and is outside the 
scope of this process.
    Comment: A commentor stated that the accurate measurement of energy 
imbalances (Schedule 4) may not be possible in the UGPR. This is 
because there may be more than one supplier at a single point of 
measurement. Determining who was the cause of the imbalance may only be 
possible during after-the-fact analysis. The power supplier may not be 
responsible for being a Control Area operator and it may be the 
operator who causes the problem. The commentor states that they do not 
have accounting that would allow them to do this on an hourly basis and 
the imbalance may change from supplier to supplier within that period.
    Response: Western recognizes that there are limitations to the 
capability of existing metering. However, FERC did not mandate next 
hour settlement of energy imbalances. This is a matter that will need 
to be further refined in development of Regional Tariff implementation 
procedures.
    Comment: A commentor stated that there seems to be a redundancy in 
the information being requested in Sections 3.0, 4.0, and 5.0 of the 
Specifications for Long-Term Firm Point-to-Point Transmission Service 
in Attachment A. The commentor is questioning whether the bill to the 
customer will be based on the Capacity Reservation in Section 3.0, the 
Capacity Reservation in Section 4.0, or on the Reserved Capacity in 
Section 5.0.
    Response: The information requested in these sections is necessary 
for multiple point-to-point transactions. The bill to the customer will 
be based on the Reserved Capacity in Section 5.0. In accordance with 
Section 13.7(c) of the Tariff, the amount in Section 5.0 will be the 
greater of the sum of the Point(s) of Receipt in Section 3.0 or the sum 
of the Point(s) of Delivery in Section 4.0.
    Comment: A commentor stated that the control area information 
requested in Section 2.0 of the Specifications for Long-Term Firm 
Point-to-Point Transmission Service in Attachment A is considerably 
different than the Control Area information obtained from Sections 1.0 
or 4.0. The Control Area to be referenced in Section 2.0 could be 
hundreds, or thousands, of miles from the Control Area of the Point of 
Receipt/Point of Delivery.
    Response: Section 2.0 is intended to define the Control Area in 
which the transaction originates, while Sections 3.0 and 4.0 define the 
Point(s) of Receipt/Delivery into and out of the Transmission 
Provider's Transmission System. Western has followed the FERC pro forma 
tariff wording in these sections, and has found no reason to change the 
pro forma language.
    Comment: A number of commentors made comments regarding Western's 
ATC, including suggestions that the methodology for determination of 
ATC must be set out in Attachment C and it must be reasonable, 
auditable, and supportable, and it should involve customer groups. 
Another commentor similarly requested that Western reference criteria 
specified within the SWRTA and/or Western Regional Transmission 
Association, Inc. (WRTA) agreements.
    Response: Western has stated in Attachment C that it will use 
``Good Utility Practice and the engineering and operating principles, 
standards, guidelines, and criteria of the * * * applicable Regional 
Reliability Council, and any entity of which the Transmission Provider 
is a member * * * such as a regional transmission group.'' Many 
customers are also members of these regional transmission groups. The 
methodology outlined in the specific regional transmission group 
criteria provides a clear set of guidelines for both Western and the 
transmission customer to evaluate Western's determination of ATC. This 
approach is consistent with filings approved by FERC for public and 
non-public utilities.
    Comment: A commentor had concerns with the last sentence of 
Attachment C which refers to reserving transmission capability for 
``forecasted power service obligations.'' It is improper for Western to 
withhold transmission capability in order to enhance future power

[[Page 526]]

marketing activities, and the inclusion of this phrase violates both 
the letter and intent of FERC Order Nos. 888 and 888-A.
    Response: In FERC Order Nos. 888 and 888-A, Section IV.C(5), FERC 
stated that, ``utilities may reserve existing transmission capacity 
needed for Native Load growth and Network load growth reasonably 
forecasted within the utility's current planning horizon.'' The 
Transmission Provider may market this capacity on a firm or non-firm 
basis until such time as the capacity is required by Native Load and 
Network Customers. Western has the same right to obtain transmission 
service for its own marketing activities as others have to obtain 
transmission service from Western for their marketing activities.
    Comment: Western received a comment that Attachment F and 
Attachment G require overlapping information.
    Response: The information required in Attachment F and Attachment G 
is not overlapping. Attachment G addresses technical and operational 
matters associated with the implementation of Attachment F.
    Comment: Western received several comments regarding its proposed 
10 times penalty included in Attachment H to the Tariff, and requesting 
Western to delete the 10 times penalty.
    Response: Western believes the penalty is more appropriately 
addressed in Regional Office specific rate processes, and, therefore, 
has deleted the 10 times penalty from Section 3.0 of Attachment H.
    Comment: A commentor asked if the general contract provisions: 
Contingent Upon Appropriations--Section 2.0, Contract Work Hours and 
Safety Standards--Section 4.0, Equal Employment Opportunity Practices--
Section 5.0, and Use of Convict Labor--Section 6.0, of Attachment J are 
necessary in these types of contractual relationships.
    Response: These provisions are required by law to be included in 
Federal contracts.
    Comment: Several commentors stated that Section 7.0 of Attachment J 
gives Western the unilateral right to terminate service if it joins or 
is required to conform to the protocols of an independent system 
operator (ISO). By itself, the fact that Western joins an ISO does not 
automatically relieve Western of its obligation to provide comparable 
transmission service. The language referring to Western's unilateral 
right to terminate service is improper and should be removed.
    Response: This language is required in the Sierra Nevada Region 
(SNR) Service Agreements consistent with the findings of FERC in 
Pacific Gas and Electric Company, et al., 81 FERC para. 61, 122 (1997). 
Western has moved this provision from Section J to the Service 
Agreements and this language shall be included by SNR in any Service 
Agreements entered into under this Tariff. Similar language may be 
required in the future by other Western Regional Offices which join 
ISO's to conform to the terms and conditions of the ISO agreement 
approved by FERC.
    Comment: A commentor stated that Section 8.0 of Attachment J could 
be interpreted to bar the resale of transmission rights when such 
resale is provided for under FERC Order Nos. 888 and 888-A.
    Response: The original Section 8.0 of Attachment J, ``Third Party 
Rights'', has been deleted.
    Comment: A commentor asked what third party rights BEPC and HCPD 
have under Section 8.0 of Attachment J.
    Response: The original Section 8.0 of Attachment J, ``Third Party 
Rights'', has been deleted.
    Comment: A commentor asked why Western includes the phrase 
``emergency power'' in Section 10.0 of Attachment J since the Tariff is 
for transmission service only and it does not provide for Western to 
supply capacity and energy. The same commentor asked how does Western 
define emergency power and under what circumstances will it be 
provided?
    Response: Western has modified Section 10.0 of Attachment J to 
remove the reference to emergency power.
    Comment: A commentor stated that the billing adjustments 
contemplated in Sections 13.0 and 14.0 of Attachment J need to include 
refunds of advances.
    Response: Sections 13.0 and 14.0 are not the mechanism for Western 
to provide refunds for funds advanced to Western. Western added 
language to Sections 19.4 and 32.4 to clarify that amounts advanced in 
excess of costs incurred will be refunded.
    Comment: Several commentors have raised issues regarding the bill 
crediting and net billing language in Sections 13.0 and 14.0 of 
Attachment J to the Tariff. There is a concern that the language is too 
broad and creates the potential for abuse. The provisions in Attachment 
J and the associated language in the proposed Service Agreements use 
the leverage of access to Western's Transmission System to require the 
transmission customer to agree to Western's Net Billing and Bill 
Crediting procedures as a condition for service and as means to provide 
alternative financing for Western. These provisions appear to be in 
conflict with the functional unbundling requirements of FERC Order Nos. 
888 and 888-A and may, in fact, require the transmission customer to 
violate its own Standards of Conduct implementing FERC Order No. 889 
and 18 CFR part 37. All provisions requiring the transmission customer 
to agree to Net Billing and Bill Crediting procedures as a condition 
for service under the Tariff must be removed.
    Response: Western has modified these sections to clarify that the 
``Net Billing and Bill Crediting'' provisions are optional. The 
inclusion of these provisions in the Tariff is non-discriminatory 
because they are not a condition for receiving service.
    Comment: Western received several comments regarding proposed 
changes to Attachment K. A comment was received requesting that the 
phrase ``* * * from the Navajo Project for the Central Arizona Project, 
Boulder Canyon Project and the * * *'' be deleted from the Desert 
Southwest Region's (DSR) section of Attachment K. Another commentor 
requested that the phrase ``* * * of the Parker Davis-Project in DSR * 
* *'' be inserted. The same commentor also requested that in the first 
paragraph of Attachment K, that Western delete the phrase ``* * * and 
one coal fired power plant in Arizona * * *,'' and replace the word 
``integrated'' with ``interconnect.'' A commentor requested that in the 
seventh paragraph of Attachment K that Western change ``little 
flexibility'' to ``little or no flexibility.''
    Response: Western concurs with the comments and has made the 
changes to Attachment K.
    Comment: A commentor proposed the following language for inclusion 
in the fourth paragraph of Attachment K, which would read as follows:

    * * * treat its Federal Customers in a manner analogous to the 
treatment of Native Load Customers by public utilities. The enabling 
legislation for the various projects authorizes both transmission 
and generation project expenses and contemplates recovery of these 
through power rates. For these reasons, Western will continue to 
recover transmission and generation related costs from Federal 
Customers through a bundled power sales rate. Western is committed 
to providing * * *

    Response: Western does not believe that it is necessary to add the 
proposed text to Attachment K. The issue of cost recovery will be 
addressed on a case-by-case basis in the appropriate rate process.
    Comment: A commentor stated that Sections 17.1 and 29.2 require 
that a written application for long-term, firm service be submitted to 
the ``appropriate Regional Office, as identified in

[[Page 527]]

Attachment K.'' However, Attachment K provides no address, title, or 
even a phone number, to which such an application can be submitted. 
Western should correct Attachment K to include this information for 
each Regional Office.
    Response: Western has noted the omission and has included the 
appropriate information in Attachment K to the Tariff.
    Comment: Two commentors stated that there is no applicable 
definition for Federal project use loads.
    Response: Western has modified Attachment K to the Tariff to 
clarify that Reclamation is responsible for providing Federal power 
resources to its project use customers. Western believes that this 
modification is sufficient to address this comment.
    Comment: A commentor stated that Attachment K should include 
language stating that there will be no on-going transmission 
reservation maintained for incremental sales and that when Western does 
reserve transmission capacity for incremental sales, it will do so 
through its Open Access Same-Time Information System (OASIS) and 
account for such reservation as a Third Party Sale pursuant to Section 
8.0 of the Tariff.
    Response: The Tariff provides for the required treatment and 
Western has found no reason to include additional language as proposed 
by the commentor.
    Comment: Western received many comments that raised issues 
concerning its obligations to serve Federal loads and the relationship 
of this obligation to Western's ability to comply with open access 
comparability standards set forth by FERC in Orders No. 888 and 888-A. 
The following summarizes the comments.
    Western should be consistent between all of its Regional Offices in 
treating its existing transmission obligation to Federal customers as 
existing Point-to-Point Service. Any new sales Western makes to Federal 
customers should be unbundled and accounted for under the Tariff as 
Point-to-Point Service. Transmission for incremental sales to Federal 
customers should be reserved, provided, and accounted for as Point-to-
Point Transmission Service under the Tariff.
    It may be appropriate for Western to identify existing Federal 
customers as Native Load, but such partial requirements service at a 
discrete Point of Delivery clearly does not meet the definition of 
Network Load as set forth in Section 1.22.
    To the extent Western has firm service obligations to Federal 
customers, reserving firm transmission capacity is appropriate. To the 
extent that Western intends to reserve firm transmission on its system 
in order to maintain the opportunity to make incremental sales to 
Federal customers above and beyond Western's firm obligations under 
certain favorable hydrologic conditions, such transmission reservations 
for generation merchant activities appear to be in direct conflict with 
the functional unbundling requirements of FERC Order No. 888.
    Western has not clearly distinguished the jurisdictional separation 
of its statutory service from its proposed service under Western's 
Tariff. Western needs further revisions to its Tariff to clearly 
delineate the jurisdictional difference.
    Western should perform two separate, parallel functions: statutory 
transmission service and third party transmission service.
    Include the term ``Federal Customer'' in various places of the 
Tariff other than Attachment K.
    In Attachment K, include the word ``retail'' before the word 
``Native'' in the sentence which describes Western's treatment of its 
Federal customers.
    The use of the term ``Native Load'' appears as an intention to 
unbundle firm electric service arrangements. Several commentors 
disputed Western's claim that its deliveries of power to Federal 
customers, defined by Western as ``the statutory and firm electric 
service and project use power users of the Federal Government'' are 
analogous to a public utility's deliveries to its own native load 
customers. Other comments included suggestions on how to redefine 
Federal customers and Federal generation and a suggestion that 
Western's deliveries were more precisely analogous to a public 
utility's retail Native Load.
    The reservation provisions (2.2, 13.6 and 33.2) will not work. 
First, carried to its extreme, all current firm electric service 
contractors could cancel their contracts and be left with the ability 
to transfer other resources across Western's system, leaving Western no 
system to deliver hydropower.
    The curtailment of contractors' firm electric service deliveries 
simultaneously with third party use of the system violates Western's 
statutory mandate. Another commentor stated that pro rata curtailments 
put Western's preference customers in the position of subsidizing third 
party transmission contractors.
    A qualifier statement should be included in Section 33.0 to explain 
the process of load shedding and curtailment to be used, such as ``* * 
* that only load shedding and curtailments covered in this section are 
for new contracts entered into on the OASIS. They do not include 
existing contracts * * *'' Other commentors stated that there is no 
indication of how Reclamation's project use loads are served with 
Federal transmission capacity and expressed concern as to the 
applicability of curtailment.
    How will load shedding and curtailment provisions of Section 33.0 
work?
    Response: Individual project authorization acts have provided 
Western the obligation and authority to market capacity and energy 
surplus to the needs of these multi-purpose projects. Western manages 
its transmission systems to meet these needs as well as to ensure the 
reliable operation of the overall transmission systems for which it is 
responsible. Section 211 of the Federal Power Act also requires Western 
to provide open transmission access. Western will meet all of these 
obligations in the following manner. Use of transmission facilities 
that Western owns, operates, or to which it has contract rights for 
delivery of Federal long-term firm capacity and energy to project use 
and electric service customers is a Western responsibility under the 
terms and conditions of marketing criteria and electric service 
contracts implementing statutory obligations to market Federal power. 
This is complementary with the provisions of the Tariff. Transmission 
service provided by Western under the Tariff is solely for the use of 
ATC in excess of the capability Western requires for deliveries of 
long-term firm capacity and energy to project use and electric service 
customers of the Federal government. Western has also stated that 
nothing in the Tariff shall alter, amend, or abridge the statutory or 
contractual obligations of Western to market and deliver Federal power 
resources and to repay the Federal investment in its projects.
    Western has found it is no longer necessary to state that service 
to customers of the Federal government is analogous to service provided 
to Native Load Customers by public utilities. The term ``Federal 
Customers'' has been deleted from the Tariff. Further, Western 
clarifies that deliveries to discrete points of delivery can be made 
under existing authorities and contracts and deliveries of additional 
power at the same point may be made under the Tariff without violating 
the provisions of Section 1.22 of the Tariff. Western will use the 
Tariff for all Third Party Sales.

[[Page 528]]

    Western will operate its system according to Good Utility 
Practices, and unless otherwise provided for in existing contracts or 
regulations, will perform curtailments and other emergency procedures 
in a non-discriminatory manner in accordance with the terms of the 
Tariff and the governance of the National Electric Reliability Council, 
an RTG, or ISO as appropriate.
    Western has modified the Tariff to be consistent with the above 
statements.
    Comment: A commentor asked what does the term ``unused capacity'' 
in Attachment K mean and how does it apply to UGPR? Does Western have 
the right to terminate service if it determines the unused capacity no 
longer exists?
    Response: Attachment K has been modified by deleting the term 
``unused capacity''. Once committed to contractually, transmission 
capacity will be available to a transmission customer for the duration 
of the contract term in conformance with the provisions of the Tariff.
    Comment: A commentor stated that preference should apply to rights 
to excess capacity on the Federal Transmission System.
    Response: Neither Section 9(c) of the Reclamation Project Act of 
1939 nor Section 5 of the Flood Control Act of 1944 require Western to 
give preference in the sale of excess transmission capacity to any 
particular type of entity.
    Comment: A commentor stated that Western must jurisdictionally 
separate statutory service and tariff service because Western does not 
have new Environmental Impact Statements or Endangered Species Act 
determinations which indicate Western can provide Network Integration 
Transmission Service or Ancillary Services from its generation. 
Western's power contracts should not require future unbundling of 
transmission service because the unbundling of contracts and power 
deliveries may in fact be in contradiction of the environmental 
analysis performed for each of the power contract extensions. Another 
comment was made that Ancillary Services are generation-related but 
were not included in any environmental analyses for river ecosystem, 
hydrodam operations, or power marketing.
    Response: Western has not committed or proposed any construction of 
specific new transmission or generation facilities in the Tariff. The 
establishment of contract language and transmission arrangements that 
do not involve: (1) The integration of a new generation resource, (2) 
physical changes in the transmission system beyond the previously 
developed facility area, or (3) changes in the normal operating limits 
of generation resources is categorically excluded by DOE regulations 
from the preparation of an environmental assessment (EA) or 
environmental impact statement (EIS). Nothing in this generic contract 
language requires or causes such events to occur. If and when Western 
proposes to enter into a contract or transmission agreement which it 
reasonably would expect to require or cause such events to occur, 
Western will prepare appropriate documentation for its actions in 
compliance with the National Environmental Policy Act of 1969, as 
amended, 42 U.S.C. 4321-4347, Council of Environmental Quality 
regulations, 40 CFR 1500-1508 and DOE regulations at 10 CFR part 1021.
    Western's power contracts do not require future unbundling of 
transmission service. Decisions related to unbundling will be 
determined through a separate process.
    Comment: Several commentors stated that they do not see how Western 
can maintain its statutory obligations to generate and deliver the 
maximum amount of firm capacity and energy to preference customers 
while unbundling, unless Western offers other services.
    Response: This comment does not accurately describe Western's 
statutory obligations. The creation of the Tariff does not affect 
Western's obligations under existing contracts.
    Comment: A commentor stated that unbundling will produce cost-
shifts in the projects that are statutorily cost-recovery based.
    Response: Western is complying with FERC Order Nos. 888 and 888-A. 
This requires the unbundling of Ancillary Services from transmission 
service for service under the Tariff. The rates for these services are 
based on the costs incurred to provide these services. Any revenues 
received from these services will be applied to project repayment.
    Comment: A commentor stated that unbundling of firm electric 
service leaves no recourse but to file under Section 211 of the Federal 
Power Act. Customers may need more up-front oversight of Western's 
actions, such as Sections 205 and 206 require of FERC jurisdictional 
utilities.
    Response: Oversight of Western's activities is outside the scope of 
this process.
    Comment: Two comments were received stating that the reference to 
``Western's hydroelectric power facilities'' is incorrect. The 
facilities referred to are Reclamation's hydroelectric power 
facilities.
    Response: Western agrees with this comment.
    Comment: A commentor noted that in FERC Order No. 888-A, FERC 
decided to implement Service Agreement procedures for firm point-to-
point transactions of less than a year in duration (short-term firm) 
that are similar to those for non-firm point-to-point service. In other 
words, only one umbrella service agreement needs to be executed. 
Subsequent short-term firm transactions need only be requested and 
reserved via the OASIS. The commentor encourages Western to include in 
its Tariff a form of umbrella service agreement for Short-term Firm 
Point-to-Point Transmission Service that will operate in a similar 
manner to the Service Agreement for Non-Firm Service.
    Response: Western agrees that Attachment A may be used as an 
umbrella service agreement for Short-term Firm Point-to-Point 
Transmission Service.
    Comment: A commentor stated that the Tariff includes modifications 
to recognize Western's distinction as a Federal entity, and this seems 
to include non-Federal entities under the cloak of Federal law.
    Response: These modifications apply to UGPR as the operator/manager 
of the Integrated System (IS). These modifications do not bring BEPC or 
HCPD under the cloak of Federal law.
    Comment: Several commentors commended Western for its efforts in 
developing its proposed open access transmission service Tariff. With 
the understanding that Western is committed to working to modify its 
Tariff when it is found to be warranted, these commentors also support 
both the Tariff and Western's filing of the Tariff with FERC.
    Response: Western appreciates these comments.
    Comment: A commentor stated that all references to stranded costs 
should be deleted from the Tariff.
    Response: The right to collect stranded costs is recognized in FERC 
Order Nos. 888 and 888-A. The stranded cost language in Western's 
Tariff is modeled upon the language in FERC's pro forma tariff. 
Recovery of stranded costs is neither incorporated in any of the 
Regional Office's proposed rates nor in the Open Access Transmission 
Rate formula for the UGPR.
    Comment: A commentor asked Western what is its authority to collect 
stranded costs for BEPC and HCPD.
    Response: Attachment K recognizes the right of UGPR, BEPC, and HCPD 
to collect stranded costs in accordance

[[Page 529]]

with the principles established in FERC Order Nos. 888 and 888-A. 
Attachment K states that the collection of stranded costs by BEPC and 
HCPD will be subject to contracts separate from the Tariff.
    Comment: Two commentors requested that Western's DSR and SNR 
implement the Ancillary Services, Schedules 1 through 6 under the 
Tariff, as a separate tariff on an interim basis to resolve areas of 
concern.
    Response: The provision of Ancillary Services is an integral part 
of FERC's pro forma tariff and cannot be separated from Western's 
Tariff. Western is concerned that any further qualifiers on the 
provision of Ancillary Services could impair Western's ability to pass 
FERC's standards for comparability. This, in turn, would impair 
Western's ability to obtain reciprocal transmission service from public 
utilities. Therefore, Western will not consider implementing the 
Ancillary Services portion of the Tariff on an interim basis.
    Comment: Two commentors stated that the language in each of the 
service schedules concerning pass-through costs from the Control Area 
operator does not apply in those cases when Western is not the Control 
Area operator. Reclamation does not pass the costs for generation 
through the Control Area operator in those cases, but allocates the 
costs to Western, who passes the costs through to the transmission 
customer.
    Response: These provisions provide Western the ability to purchase 
capacity and energy from others when it is necessary and pass those 
costs on directly to the beneficiary. This is a transaction involving 
only the Control Area operator, the transmission customer, and Western.
    Comment: A commentor suggested that Western's statutory obligations 
prevent it from effectively providing those Ancillary Services which 
involve the dedication of generation resources or output to non-Federal 
customers. Western should specifically limit itself to brokering these 
types of Ancillary Services to its transmission customers.
    Response: Western does recognize resource limitations of the 
hydroelectric generation. Section 3 of the proposed Tariff was modified 
to include the option for Western to purchase Ancillary Services and 
pass through such costs to the transmission customer.
    Comment: A commentor stated that it understands that Western will 
honor existing transmission service contracts without compelling 
existing customers to sign a Service Agreement under the Tariff. The 
commentor recommended that this commitment be described in Attachment 
J.
    Response: Western will honor existing transmission service 
contracts without compelling existing customers to sign a Service 
Agreement under the Tariff. Western does not believe this needs to be 
specified in Attachment J. The Tariff provides for any new requests for 
transmission service.
    Comment: A commentor stated that Western's power factor requirement 
should be clearly stated in the Tariff.
    Response: There is no single Western power factor requirement. 
Western will include the applicable power factor requirement for each 
Regional Office in the offered Service Agreements.
    Comment: A commentor asked that if the Tariff is binding upon 
Western, by what means would the Tariff be made binding on BEPC and 
HCPD?
    Response: If the IS rate is approved in the rate setting public 
process, then the UGPR will enter into the contracts with BEPC and HCPD 
for the management and operation of the IS. Such contractual 
arrangements will make the terms of the Tariff binding upon BEPC and 
HCPD. This would preclude either BEPC or HCPD from making separate 
arrangements to sell transmission service over the IS.
    Comment: A commentor is very supportive of Attachment F having 
provisions for a credit for integrated facilities and looks forward to 
negotiations to recognize and equitably credit customer facilities that 
have augmented the Federal system.
    Response: Western appreciates the comment.
    Comment: Western received a comment that Attachment K states that, 
``Western will sell transmission service using Federally owned or 
controlled facilities only to the extent that transmission capacity is 
available in excess of that needed to deliver Federal power.'' This is 
inconsistent with the inclusion of non-Federal facilities in the 
definition of Transmission System.
    Response: This comment is outside of the scope of this process. The 
determination of the facilities to be included in the Transmission 
System will be developed in the rate process.
    Comment: A commentor stated that Attachment K to the Tariff 
describes the UGPR's intent to include the facilities of BEPC and HCPD 
in the UGPR transmission facilities. UGPR also includes provisions for 
recovery of stranded costs. The commentor recommends that the other 
Regional Offices' plans for their respective rate-making activities 
remain open to the possibility of incorporating this or similar joint 
rates.
    Response: This issue is better addressed on a case-by-case basis in 
the appropriate rate process.
    Comment: Several commentors have raised concerns regarding 
Western's provisions in the Tariff for changing rates. It appears to 
certain commentors that Western may change a rate only to an individual 
customer.
    Response: The language is not intended to imply that Western will 
unilaterally change rates to one customer. Western's Regional Offices 
change rates through rate adjustment processes pursuant to Federal law 
and apply the rates uniformly to their respective customers.
    Comment: Commentors raised a number of issues that related to 
Western's rate setting processes, including among others, inclusion of 
specific rates and charges with the Tariff, allocation of costs between 
transmission and ancillary services, inclusion of various costs and 
facilities in transmission rates, and rate setting methodology.
    Response: These comments are outside the scope of this process. 
Each of Western's Regional Offices is at a different point in the 
process of developing open access transmission rates. Western's 
Regional Offices follow a separate and distinct process for the 
approval of their rates, which involves considerable public involvement 
and filing of the final rates with FERC. DOE approval of Western's 
rates is addressed in DOE Delegation Order No. 0204-108. Western's 
procedures for public involvement for rate procedures are covered in 10 
CFR part 903. Filing requirements and procedures for FERC review of 
Federal Power Marketing Administration rates are detailed in 18 CFR 
part 300. Since Western's rate procedures are handled through so many 
separate processes, Western will not include specific rates and charges 
in the Tariff.
    Comment: A commentor stated that the distinction between the 
transmission system used to deliver Federal power to UGPR's customers 
and the larger, more expensive system proffered for service to third 
parties does not comport with comparability.
    Response: Transmission service to existing UGPR firm power 
customers is provided for under the provisions of existing contracts. 
This is consistent with FERC's treatment of such existing contracts 
under FERC Order Nos. 888 and 888-A.
    Comment: A UGPR customer commented that in Section 2.2, existing 
firm electric service customers should not be subject to paying a 
transmission service rate that is different than all

[[Page 530]]

other preference power customers simply due to the timing of a contract 
expiration or renewal.
    Response: UGPR intends to have a single firm power rate for all 
preference customers who execute service agreements for implementation 
of the Post-85 Marketing Plan.
    Comment: The statutory obligations referred to in Section II of the 
Federal Register are significant and important enough to be contained 
in the Tariff possibly at Section 11.0 of Attachment J.
    Response: Western agrees that the various statutes governing 
Western's actions are significant, but does not agree that it would be 
appropriate to include a listing in the Tariff.
    Comment: Existing preference customers should not be impacted by 
Western's commitment to meet the load growth of Network Integration 
Transmission Service Customers.
    Response: This comment is a rate issue and is outside of the scope 
of this process.
    Comment: One commentor stated that Western must carefully weigh the 
requirements of compliance with FERC Order No. 889 Standards of 
Conduct.
    Response: Western will comply with FERC Order No. 889.

IV. Summary of Significant Changes From Western's Proposed Tariff

    In Section 1.46, Western deleted portions of the additional 
language that were not necessary. In Section 1.49, Western reverted to 
the pro forma language. In Section 3, Western modified the proposed 
additional language to clarify Western's commitment to make every 
effort to provide Ancillary Services from purchased generation when 
Western's own resources are unavailable. In Section 10.1, Western 
removed the proposed additional language.
    Western reinstated the last sentence in Section 12.1 except for 
``submitted to arbitration and'', and ``arbitration.'' Those two 
phrases remained stricken. In Section 12.2, Western replaced the 
proposed language with language that refers to RTG dispute resolution 
processes.
    In Sections 19.4 and 32.4, Western replaced ``provide the required 
letter of credit'' with ``pay the transmission customer's share of the 
costs'' and added language that Western will refund amounts advanced in 
excess of costs incurred.
    A minor change was made to Section 29.1 consistent with the minor 
change in FERC Order 888-B, 81 FERC para. 61,248, issued November 25, 
1997.
    In Attachment H, Western removed references to the 10 times penalty 
provision. Western moved the provisions relating to the establishment 
of an ISO in Attachment J to Attachment A, Attachment B, and Attachment 
F. These terms initially will apply only to SNR. Western deleted 
provisions relating to third party rights in Attachment J. Western 
clarified that Net Billing and Bill Crediting provisions are applicable 
only when mutually agreed.
    In Attachment K, Western made editorial changes including the 
insertion of the address, title, and telephone numbers of the Regional 
Office contacts. Western modified its language in Attachment K to 
clarify its statutory obligation to market Federal power. The modified 
language further clarifies that this Tariff does not affect existing 
contractual obligations.

V. Coordination with Adoption of Open Access Transmission Rates

    Each of Western's Regional Offices is at a different point in the 
process of developing Open Access Transmission Rates. DOE approval of 
Western's rates is addressed in DOE Delegation Order No. 0204-108. 
Western's procedures for public involvement for rate procedures are 
covered in 10 CFR part 903. Filing requirements and procedures for FERC 
review of Power Marketing Administration rates are detailed in 18 CFR 
part 300. Until the Regional Offices complete the processes of placing 
rates in effect for the services to be provided under the open-access 
tariff, they will use existing rates when applicable. Rates for short-
term sales may be placed in effect by Western's Administrator and used 
when no rates exist for such services.
    The new SNR rates for ancillary services and transmission became 
effective October 1, 1997, and will be effective for a 5-year period 
ending September 30, 2002.
    The CRSP CSC is currently conducting a public process to develop 
transmission and ancillary service rates consistent with FERC Order 
Nos. 888 and 888-A to be used with the Tariff. The public comment 
period concluded September 23, 1997. The proposed effective date of the 
rates will be April 1, 1998.
    The DSR began a public involvement process to develop transmission 
and ancillary service rates consistent with FERC Order Nos. 888 and 
888-A through a series of informational meetings with its customers 
held on March 5, 1997, July 23, 1997, and September 3, 1997. At the 
September 3, 1997, meeting, it was determined that the formal process 
to develop new rates will not begin until after publication of 
Western's Open Access Tariff. As a result, the proposed effective date 
for the new rates will be no later than October 1, 1998. DSR will 
implement this Tariff using rates for short-term sales approved by 
Western's Administrator in December 1997.
    The UGPR has implemented Open Access Transmission Rates approved by 
Western's Administrator. These transmission rates and ancillary service 
rates became effective December 20, 1997, and will expire December 19, 
1998. On March 28, 1997, by the mailing of an Advance Announcement of 
the transmission rate adjustment for the Pick-Sloan Missouri Basin 
Program, Eastern Division, a public process was initiated to establish 
long-term Open Access Transmission Rates for the UGPR. UGPR has 
received comments from that announcement and published its proposal in 
September 1997. The proposed effective date is February 1, 1998.
    The Rocky Mountain Region (RMR) began a formal public involvement 
process on September 19, 1997, to develop transmission and ancillary 
service rates consistent with FERC Order Nos. 888 and 888-A to be used 
with the Tariff. The proposed effective date of the rates will be April 
1, 1998. The RMR will have rates for short-term sales in effect between 
the effective date of the Tariff and April 1, 1998.
    Subsequent changes to Regional Office Open Access Transmission 
Rates will be completed on a project-by-project basis using the public 
involvement and FERC review processes outlined above.

VI. Regulatory Requirements

Review 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 (OMB) is required.

Regulatory Flexibility Analysis

    The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, requires 
Federal agencies to perform a regulatory flexibility analysis if a 
proposed rule is likely to have a significant economic impact on a 
substantial number of small entities. The Acting Administrator for 
Western certifies that Western's providing open transmission access 
would not cause an adverse economic impact on a substantial number of 
such entities. Since the proposed open-access Tariff is of limited 
applicability, no flexibility analysis is required.

[[Page 531]]

Review Under the Paperwork Reduction Act:

    In accordance with the Paperwork Reduction Act of 1980, 44 U.S.C. 
3501-3520, Western has received approval from OMB for the collection of 
customer information in this rule, under OMB control number 1910-0100.

Review Under the National Environmental Policy Act

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

Availability of Information

    Western's final Tariff and a redline/strikeout comparison of 
Western's final Tariff to the FERC pro forma will be available from the 
informational contacts listed above or on the Internet at <a href="http://
www.wapa.gov">http://
www.wapa.gov</a>.

    Dated: December 15, 1997.
Michael S. Hacskaylo,
Acting Administrator.

Open Access Transmission Service Tariff

Table of Contents

Part I. Common Service Provisions

1  Definitions
    1.1  Ancillary Services
    1.2  Annual Transmission Costs
    1.3  Application
    1.4  Commission
    1.5  Completed Application
    1.6  Control Area
    1.7  Curtailment
    1.8  Delivering Party
    1.9  Designated Agent
    1.10  Direct Assignment Facilities
    1.11  Eligible Customer
    1.12  Facilities Study
    1.13  Firm Point-To-Point Transmission Service
    1.14  Good Utility Practice
    1.15  Interruption
    1.16  Load Ratio Share
    1.17  Load Shedding
    1.18  Long-Term Firm Point-To-Point Transmission Service
    1.19  Native Load Customers
    1.20  Network Customer
    1.21  Network Integration Transmission Service
    1.22  Network Load
    1.23  Network Operating Agreement
    1.24  Network Operating Committee
    1.25  Network Resource
    1.26  Network Upgrades
    1.27  Non-Firm Point-To-Point Transmission Service
    1.28  Open Access Same-Time Information System
    1.29  Part I
    1.30  Part I
    1.31  Part III
    1.32  Parties
    1.33  Point(s) of Delivery
    1.34  Point(s) of Receipt
    1.35  Point-To-Point Transmission Service
    1.36  Power Purchaser
    1.37  Receiving Party
    1.38  Regional Transmission Group
    1.39  Reserved Capacity
    1.40  Service Agreement
    1.41  Service Commencement Date
    1.42  Short-Term Firm Point-To-Point Transmission Service
    1.43  System Impact Study
    1.44  Third-Party Sale
    1.45  Transmission Customer
    1.46  Transmission Provider
    1.47  Transmission Provider's Monthly Transmission System Peak
    1.48  Transmission Service
    1.49  Transmission System
2  Initial Allocation and Renewal Procedures
    2.1  Initial Allocation of Available Transmission Capability
    2.2  Reservation Priority For Existing Firm Service Customers
3  Ancillary Services
    3.1  Scheduling, System Control and Dispatch Service
    3.2  Reactive Supply and Voltage Control from Generation Sources 
Service
    3.3  Regulation and Frequency Response Service
    3.4  Energy Imbalance Service
    3.5  Operating Reserve--Spinning Reserve Service
    3.6  Operating Reserve--Supplemental Reserve Service
4  Open Access Same-Time Information System (OASIS)
5  Local Furnishing Bonds
    5.1  Transmission Providers That Own Facilities Financed by 
Local Furnishing Bonds
    5.2  Alternative Procedures for Requesting Transmission Service
6  Reciprocity
7  Billing and Payment
    7.1  Billing Procedures
    7.2  Interest on Unpaid Balances
    7.3  Customer Default
8  Accounting for the Transmission Provider's Use of the Tariff
    8.1  Transmission Revenues
    8.2  Study Costs and Revenues
9  Regulatory Filings
10  Force Majeure and Indemnification
    10.1  Force Majeure
    10.2  Indemnification
11  Creditworthiness
12  Dispute Resolution Procedures
    12.1  Internal Dispute Resolution Procedures
    12.2  External Dispute Resolution Procedures
    12.3  Rights Under The Federal Power Act

Part II. Point-to-Point Transmission Service

Preamble

13  Nature of Firm Point-To-Point Transmission Service
    13.1  Term
    13.2  Reservation Priority
    13.3  Use of Firm Transmission Service by the Transmission 
Provider
    13.4  Service Agreements
    13.5  Transmission Customer Obligations for Facility Additions 
or Redispatch Costs
    13.6  Curtailment of Firm Transmission Service
    13.7  Classification of Firm Transmission Service
    13.8  Scheduling of Firm Point-To-Point Transmission Service
14  Nature of Non-Firm Point-To-Point Transmission Service
    14.1  Term
    14.2  Reservation Priority
    14.3  Use of Non-Firm Point-To-Point Transmission Service by the 
Transmission Provider
    14.4  Service Agreements
    14.5  Classification of Non-Firm Point-To-Point Transmission 
Service
    14.6  Scheduling of Non-Firm Point-To-Point Transmission Service
    14.7  Curtailment or Interruption of Service
15  Service Availability
    15.1  General Conditions
    15.2  Determination of Available Transmission Capability
    15.3  Initiating Service in the Absence of an Executed Service 
Agreement
    15.4  Obligation to Provide Transmission Service that Requires 
Expansion or Modification of the Transmission System
    15.5  Deferral of Service
    15.6  Other Transmission Service Schedules
    15.7  Real Power Losses
16  Transmission Customer Responsibilities
    16.1  Conditions Required of Transmission Customers
    16.2 Transmission Customer Responsibility for Third-Party 
Arrangements
17 Procedures for Arranging Firm Point-To-Point Transmission Service
    17.1 Application
    17.2 Completed Application
    17.3 Processing Fee
    17.4 Notice of Deficient Application
    17.5 Response to a Completed Application
    17.6 Execution of a Service Agreement
    17.7 Extensions for Commencement of Service
18 Procedures for Arranging Non-Firm Point-To-Point Transmission 
Service
    18.1 Application
    18.2 Completed Application
    18.3 Reservation of Non-Firm Point-To-Point Transmission Service
    18.4 Determination of Available Transmission Capability
19 Additional Study Procedures For Firm Point-To-Point Transmission 
Service Requests
    19.1 Notice of Need for System Impact Study
    19.2 System Impact Study Agreement and Compensation
    19.3 System Impact Study Procedures
    19.4 Facilities Study Procedures
    19.5 Facilities Study Modifications
    19.6 Due Diligence in Completing New Facilities
    19.7 Partial Interim Service
    19.8 Expedited Procedures for New Facilities

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20 Procedures if The Transmission Provider is Unable to Complete New 
Transmission Facilities for Firm Point-To-Point Transmission Service
    20.1 Delays in Construction of New Facilities
    20.2 Alternatives to the Original Facility Additions
    20.3 Refund Obligation for Unfinished Facility Additions
21 Provisions Relating to Transmission Construction and Services on 
the Systems of Other Utilities
    21.1 Responsibility for Third-Party System Additions
    21.2 Coordination of Third-Party System Additions
22 Changes in Service Specifications
    22.1 Modifications On a Non-Firm Basis
    22.2 Modifications On a Firm Basis
23 Sale or Assignment of Transmission Service
    23.1 Procedures for Assignment or Transfer of Service
    23.2 Limitations on Assignment or Transfer of Service
    23.3 Information on Assignment or Transfer of Service
24 Metering and Power Factor Correction at Receipt and Delivery 
Point(s)
    24.1 Transmission Customer Obligations
    24.2 Transmission Provider Access to Metering Data
    24.3 Power Factor
25 Compensation for Transmission Service
26 Stranded Cost Recovery
27 Compensation for New Facilities and Redispatch Costs

Part III. Network Integration Transmission Service

Preamble

28 Nature of Network Integration Transmission Service
    28.1 Scope of Service
    28.2 Transmission Provider Responsibilities
    28.3 Network Integration Transmission Service
    28.4 Secondary Service
    28.5 Real Power Losses
    28.6 Restrictions on Use of Service
29 Initiating Service
    29.1 Condition Precedent for Receiving Service
    29.2 Application Procedures
    29.3 Technical Arrangements to be Completed Prior to 
Commencement of Service
    29.4 Network Customer Facilities
    29.5 This section is intentionally left blank
30 Network Resources
    30.1 Designation of Network Resources
    30.2 Designation of New Network Resources
    30.3 Termination of Network Resources
    30.4 Operation of Network Resources
    30.5 Network Customer Redispatch Obligation
    30.6  Transmission Arrangements for Network Resources Not 
Physically Interconnected With The Transmission Provider
    30.7 Limitation on Designation of Network Resources
    30.8 Use of Interface Capacity by the Network Customer
    30.9 Network Customer Owned Transmission Facilities
31 Designation of Network Load
    31.1  Network Load
    31.2 New Network Loads Connected With the Transmission Provider
    31.3 Network Load Not Physically Interconnected with the 
Transmission Provider
    31.4 New Interconnection Points
    31.5 Changes in Service Requests
    31.6 Annual Load and Resource Information Updates
32 Additional Study Procedures For Network Integration Transmission 
Service Requests
    32.1 Notice of Need for System Impact Study
    32.2 System Impact Study Agreement and Compensation
    32.3 System Impact Study Procedures
    32.4 Facilities Study Procedures
33  Load Shedding and Curtailments
    33.1 Procedures
    33.2 Transmission Constraints
    33.3 Cost Responsibility for Relieving Transmission Constraints
    33.4 Curtailments of Scheduled Deliveries
    33.5 Allocation of Curtailments
    33.6 Load Shedding
    33.7 System Reliability
34 Rates and Charges
    34.1 Monthly Demand Charge
    34.2 Determination of Network Customer's Monthly Network Load
    34.3 Determination of Transmission Provider's Monthly 
Transmission System Load
    34.4 Redispatch Charge
    34.5 Stranded Cost Recovery
35 Operating Arrangements
    35.1 Operation under The Network Operating Agreement
    35.2 Network Operating Agreement
    35.3 Network Operating Committee

Schedule 1 Scheduling, System Control and Dispatch Service
Schedule 2 Reactive Supply and Voltage Control from Generation 
Sources Service
Schedule 3 Regulation and Frequency Response Service
Schedule 4 Energy Imbalance Service
Schedule 5 Operating Reserve--Spinning Reserve Service
Schedule 6  Operating Reserve--Supplemental Reserve Service
Schedule 7 long-Term Firm and Short-Term Firm Point-to-Point 
Transmission Service
Schedule 8 Non-Firm Point-to-Point Transmission Service
Attachment A Form of Service Agreement For Firm Point-to-Point 
Transmission Service
Attachment B Form of Service Agreement For Non-Firm Point-to-Point 
Transmission Service
Attachment C Methodology to Assess Available Transmission Capability
Attachment D Methodology for Completing a System Impact Study
Attachment E Index of Point-to-Point Transmission Service Customers
Attachment F Service Agreement For Network Integration Transmission 
Service
Attachment G Network Operating Agreement
Attachment H Annual Transmission Revenue Requirement For Network 
Integration Transmission Service
Attachment I Index of Network Integration Transmission Service 
Customers
Attachment J Provisions Specific to the Transmission Provider
Attachment K Transmission Provider Authorities and Obligations

Open Access Transmission Service Tariff

I. Part I. Common Service Provisions

1 Definitions

    1.1  Ancillary Services: Those services that are necessary to 
support the transmission of capacity and energy from resources to loads 
while maintaining reliable operation of the Transmission Provider's 
Transmission System in accordance with Good Utility Practice.
    1.2 Annual Transmission Costs: The total annual cost of the 
Transmission System for purposes of Network Integration Transmission 
Service shall be the amount specified in Attachment H until amended by 
the Transmission Provider or modified by the Commission, pursuant to 
Federal Law.
    1.3 Application: A request by an Eligible Customer for transmission 
service pursuant to the provisions of the Tariff.
    1.4 Commission: The Federal Energy Regulatory Commission.
    1.5 Completed Application: An Application that satisfies all of the 
information and other requirements of the Tariff, including any 
required application processing fee.
    1.6 Control Area: An electric power system or combination of 
electric power systems to which a common automatic generation control 
scheme is applied in order to:
    (1) Match, at all times, the power output of the generators within 
the electric power system(s) and capacity and energy purchased from 
entities outside the electric power system(s), with the load within the 
electric power system(s);
    (2) Maintain scheduled interchange with other Control Areas, within 
the limits of Good Utility Practice;
    (3) Maintain the frequency of the electric power system(s) within 
reasonable limits in accordance with Good Utility Practice; and
    (4) Provide sufficient generating capacity to maintain operating 
reserves in accordance with Good Utility Practice.
    1.7 Curtailment: A reduction in firm or non-firm transmission 
service in response to a transmission capacity

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shortage as a result of system reliability conditions.
    1.8 Delivering Party: The entity supplying capacity and energy to 
be transmitted at Point(s) of Receipt.
    1.9 Designated Agent: Any entity that performs actions or functions 
on behalf of the Transmission Provider, an Eligible Customer, or the 
Transmission Customer required under the Tariff.
    1.10 Direct Assignment Facilities: Facilities or portions of 
facilities that are constructed by the Transmission Provider for the 
sole use/benefit of a particular Transmission Customer requesting 
service under the Tariff. Direct Assignment Facilities shall be 
specified in the Service Agreement that governs service to the 
Transmission Customer.
    1.11  Eligible Customer: (i) Any electric utility (including the 
Transmission Provider and any power marketer), Federal power marketing 
agency, or any person generating electric energy for sale for resale is 
an Eligible Customer under the Tariff. Electric energy sold or produced 
by such entity may be electric energy produced in the United States, 
Canada or Mexico. However, with respect to transmission service that 
the Commission is prohibited from ordering by Section 212(h) of the 
Federal Power Act, such entity is eligible only if the service is 
provided pursuant to a state requirement that the Transmission Provider 
offer the unbundled transmission service, or pursuant to a voluntary 
offer of such service by the Transmission Provider. (ii) Any retail 
customer taking unbundled transmission service pursuant to a state 
requirement that the Transmission Provider offer the transmission 
service, or pursuant to a voluntary offer of such service by the 
Transmission Provider, is an Eligible Customer under the Tariff.
    1.12  Facilities Study: An engineering study conducted by the 
Transmission Provider to determine the required modifications to the 
Transmission Provider's Transmission System, including the cost and 
scheduled completion date for such modifications, that will be required 
to provide the requested transmission service.
    1.13  Firm Point-To-Point Transmission Service: Transmission 
Service under this Tariff that is reserved and/or scheduled between 
specified Points of Receipt and Delivery pursuant to Part II of this 
Tariff.
    1.14  Good Utility Practice: Any of the practices, methods and acts 
engaged in or approved by a significant portion of the electric utility 
industry during the relevant time period, or any of the practices, 
methods and acts which, in the exercise of reasonable judgment in light 
of the facts known at the time the decision was made, could have been 
expected to accomplish the desired result at a reasonable cost 
consistent with good business practices, reliability, safety and 
expedition. Good Utility Practice is not intended to be limited to the 
optimum practice, method, or act to the exclusion of all others, but 
rather to be acceptable practices, methods, or acts generally accepted 
in the region.
    1.15  Interruption: A reduction in non-firm transmission service 
due to economic reasons pursuant to Section 14.7.
    1.16  Load Ratio Share: Ratio of a Transmission Customer's Network 
Load to the Transmission Provider's total load computed in accordance 
with Sections 34.2 and 34.3 of the Network Integration Transmission 
Service under Part III of the Tariff and calculated on a rolling twelve 
month basis.
    1.17  Load Shedding: The systematic reduction of system demand by 
temporarily decreasing load in response to transmission system or area 
capacity shortages, system instability, or voltage control 
considerations under Part III of the Tariff.
    1.18  Long-Term Firm Point-To-Point Transmission Service: Firm 
Point-To-Point Transmission Service under Part II of the Tariff with a 
term of one year or more.
    1.19  Native Load Customers: The wholesale and retail power 
customers of the Transmission Provider on whose behalf the Transmission 
Provider, by statute, franchise, regulatory requirement, or contract, 
has undertaken an obligation to construct and operate the Transmission 
Provider's system to meet the reliable electric needs of such 
customers.
    1.20  Network Customer: An entity receiving transmission service 
pursuant to the terms of the Transmission Provider's Network 
Integration Transmission Service under Part III of the Tariff.
    1.21  Network Integration Transmission Service: The transmission 
service provided under Part III of the Tariff.
    1.22  Network Load: The load that a Network Customer designates for 
Network Integration Transmission Service under Part III of the Tariff. 
The Network Customer's Network Load shall include all load served by 
the output of any Network Resources designated by the Network Customer. 
A Network Customer may elect to designate less than its total load as 
Network Load but may not designate only part of the load at a discrete 
Point of Delivery. Where an Eligible Customer has elected not to 
designate a particular load at discrete points of delivery as Network 
Load, the Eligible Customer is responsible for making separate 
arrangements under Part II of the Tariff for any Point-To-Point 
Transmission Service that may be necessary for such non-designated 
load.
    1.23  Network Operating Agreement: An executed agreement that 
contains the terms and conditions under which the Network Customer 
shall operate its facilities and the technical and operational matters 
associated with the implementation of Network Integration Transmission 
Service under Part III of the Tariff.
    1.24  Network Operating Committee: A group made up of 
representatives from the Network Customer(s) and the Transmission 
Provider established to coordinate operating criteria and other 
technical considerations required for implementation of Network 
Integration Transmission Service under Part III of this Tariff.
    1.25  Network Resource: Any designated generating resource owned, 
purchased, or leased by a Network Customer under the Network 
Integration Transmission Service Tariff. Network Resources do not 
include any resource, or any portion thereof, that is committed for 
sale to third parties or otherwise cannot be called upon to meet the 
Network Customer's Network Load on a non-interruptible basis.
    1.26  Network Upgrades: Modifications or additions to transmission-
related facilities that are integrated with and support the 
Transmission Provider's overall Transmission System for the general 
benefit of all users of such Transmission System.
    1.27  Non-Firm Point-To-Point Transmission Service: Point-To-Point 
Transmission Service under the Tariff that is reserved and scheduled on 
an as-available basis and is subject to Curtailment or Interruption as 
set forth in Section 14.7 under Part II of the Tariff. Non-Firm Point-
To-Point Transmission Service is available on a stand-alone basis for 
periods ranging from one hour to one month.
    1.28  Open Access Same-Time Information System (OASIS): The 
information system and standards of conduct contained in Part 37 of the 
Commission's regulations and all additional requirements implemented by 
subsequent Commission orders dealing with OASIS.
    1.29  Part I: Tariff Definitions and Common Service Provisions 
contained in Sections 2 through 12.
    1.30  Part II: Tariff Sections 13 through 27 pertaining to Point-
To-Point

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Transmission Service in conjunction with the applicable Common Service 
Provisions of Part I and appropriate Schedules and Attachments.
    1.31  Part III: Tariff Sections 28 through 35 pertaining to Network 
Integration Transmission Service in conjunction with the applicable 
Common Service Provisions of Part I and appropriate Schedules and 
Attachments.
    1.32  Parties: The Transmission Provider and the Transmission 
Customer receiving service under the Tariff.
    1.33  Point(s) of Delivery: Point(s) on the Transmission Provider's 
Transmission System where capacity and energy transmitted by the 
Transmission Provider will be made available to the Receiving Party 
under Part II of the Tariff. The Point(s) of Delivery shall be 
specified in the Service Agreement for Long-Term Firm Point-to-Point 
Transmission Service.
    1.34  Point(s) of Receipt: Point(s) of interconnection on the 
Transmission Provider's Transmission System where capacity and energy 
will be made available to the Transmission Provider by the Delivering 
Party under Part II of the Tariff. The Point(s) of Receipt shall be 
specified in the Service Agreement for Long-Term Firm Point-to-Point 
Transmission Service.
    1.35  Point-To-Point Transmission Service: The reservation and 
transmission of capacity and energy on either a firm or non-firm basis 
from the Point(s) of Receipt to the Point(s) of Delivery under Part II 
of the Tariff.
    1.36  Power Purchaser: The entity that is purchasing the capacity 
and energy to be transmitted under the Tariff.
    1.37  Receiving Party: The entity receiving the capacity and energy 
transmitted by the Transmission Provider to Point(s) of Delivery.
    1.38  Regional Transmission Group (RTG): A voluntary organization 
of transmission owners, transmission users and other entities approved 
by the Commission to efficiently coordinate transmission planning (and 
expansion), operation and use on a regional (and interregional) basis.
    1.39  Reserved Capacity: The maximum amount of capacity and energy 
that the Transmission Provider agrees to transmit for the Transmission 
Customer over the Transmission Provider's Transmission System between 
the Point(s) of Receipt and the Point(s) of Delivery under Part II of 
the Tariff. Reserved Capacity shall be expressed in terms of whole 
megawatts on a sixty (60) minute interval (commencing on the clock 
hour) basis.
    1.40  Service Agreement: The initial agreement and any amendments 
or supplements thereto entered into by the Transmission Customer and 
the Transmission Provider for service under the Tariff.
    1.41  Service Commencement Date: The date the Transmission Provider 
begins to provide service pursuant to the terms of an executed Service 
Agreement, or the date the Transmission Provider begins to provide 
service in accordance with Section 15.3 or Section 29.1 under the 
Tariff.
    1.42  Short-Term Firm Point-To-Point Transmission Service: Firm 
Point-To-Point Transmission Service under Part II of the Tariff with a 
term of less than one year.
    1.43  System Impact Study: An assessment by the Transmission 
Provider of (i) the adequacy of the Transmission System to accommodate 
a request for either Firm Point-To-Point Transmission Service or 
Network Integration Transmission Service and (ii) whether any 
additional costs may be incurred in order to provide transmission 
service.
    1.44  Third-Party Sale: Any sale for resale in interstate commerce 
to a Power Purchaser that is not designated as part of Network Load 
under the Network Integration Transmission Service.
    1.45  Transmission Customer: Any Eligible Customer (or its 
Designated Agent) that (i) executes a Service Agreement, or (ii) 
requests in writing that the Transmission Provider provide transmission 
service without a Service Agreement, pursuant to section 15.3 of the 
Tariff. This term is used in the Part I Common Service Provisions to 
include customers receiving transmission service under Part II and Part 
III of this Tariff.
    1.46  Transmission Provider: The Regional Office of the Western 
Area Power Administration (Western) which owns, controls, or operates 
the facilities used for the transmission of electric energy in 
interstate commerce and provides transmission service under the Tariff.
    1.47  Transmission Provider's Monthly Transmission System Peak: The 
maximum firm usage of the Transmission Provider's Transmission System 
in a calendar month.
    1.48  Transmission Service: Point-To-Point Transmission Service 
provided under Part II of the Tariff on a firm and non-firm basis.
    1.49  Transmission System: The facilities owned, controlled or 
operated by the Transmission Provider that are used to provide 
transmission service under Part II and Part III of the Tariff.

2  Initial Allocation and Renewal Procedures

2.1  Initial Allocation of Available Transmission Capability
    For purposes of determining whether existing capability on the 
Transmission Provider's Transmission System is adequate to accommodate 
a request for firm service under this Tariff, all Completed 
Applications for new firm transmission service received during the 
initial sixty (60) day period commencing with the effective date of the 
Tariff will be deemed to have been filed simultaneously. A lottery 
system conducted by an independent party shall be used to assign 
priorities for Completed Applications filed simultaneously. All 
Completed Applications for firm transmission service received after the 
initial sixty (60) day period shall be assigned a priority pursuant to 
Section 13.2.
2.2  Reservation Priority For Existing Firm Service Customers
    Existing firm service customers (wholesale requirements and 
transmission-only, with a contract term of one-year or more), have the 
right to continue to take transmission service from the Transmission 
Provider when the contract expires, rolls over or is renewed. This 
transmission reservation priority is independent of whether the 
existing customer continues to purchase capacity and energy from the 
Transmission Provider or elects to purchase capacity and energy from 
another supplier. If at the end of the contract term, the Transmission 
Provider's Transmission System cannot accommodate all of the requests 
for transmission service, the existing firm service customer must agree 
to accept a contract term at least equal to a competing request by any 
new Eligible Customer and to pay the current rate for such service. 
This transmission reservation priority for existing firm service 
customers is an ongoing right that may be exercised at the end of all 
firm contract terms of one-year or longer.

3  Ancillary Services

    Ancillary Services are needed with transmission service to maintain 
reliability within and among the Control Areas affected by the 
transmission service. The Transmission Provider is required to provide 
(or offer to arrange with the local Control Area operator as discussed 
below), and the Transmission Customer is required to purchase, the 
following Ancillary Services (i) Scheduling, System Control and 
Dispatch, and (ii) Reactive Supply and

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Voltage Control from Generation Sources.
    The Transmission Provider is required to offer to provide (or offer 
to arrange with the local Control Area operator as discussed below) the 
following Ancillary Services only to the Transmission Customer serving 
load within the Transmission Provider's Control Area (i) Regulation and 
Frequency Response, (ii) Energy Imbalance, (iii) Operating Reserve--
Spinning, and (iv) Operating Reserve--Supplemental. The Transmission 
Customer serving load within the Transmission Provider's Control Area, 
is required to acquire these Ancillary Services, whether from the 
Transmission Provider, from a third party, or by self-supply. The 
Transmission Customer may not decline the Transmission Provider's offer 
of Ancillary Services unless it demonstrates that it has acquired the 
Ancillary Services from another source. However, when sufficient 
Federal generation is not available to provide the required Ancillary 
Services, the Transmission Provider will offer to make every effort to 
purchase Ancillary Services from others, as available. The costs of 
such purchases on behalf of a Transmission Customer will be passed 
directly through to that Transmission Customer. The Transmission 
Customer must list in its Application which Ancillary Services it will 
purchase from the Transmission Provider.
    If the Transmission Provider is a utility providing transmission 
service, but is not a Control Area operator, it may be unable to 
provide some or all of the Ancillary Services. In this case, the 
Transmission Provider can fulfill its obligation to provide Ancillary 
Services by acting as the Transmission Customer's agent to secure these 
Ancillary Services from the Control Area operator. The Transmission 
Customer may elect to (i) have the Transmission Provider act as its 
agent, (ii) secure the Ancillary Services directly from the Control 
Area operator, or (iii) secure the Ancillary Services (discussed in 
Schedules 3, 4, 5, and 6) from a third party or by self-supply when 
technically feasible.
    The Transmission Provider shall specify the rate treatment and all 
related terms and conditions in the event of an unauthorized use of 
Ancillary Services by the Transmission Customer.
    The specific Ancillary Services, prices and/or compensation methods 
for each are described on the Schedules that are attached to and made a 
part of the Tariff. Three principal requirements apply to discounts for 
Ancillary Services provided by the Transmission Provider in conjunction 
with its provision of transmission service as follows: (1) Any offer of 
a discount made by the Transmission Provider must be announced to all 
Eligible Customers solely by posting on the OASIS, (2) any customer-
initiated requests for discounts (including requests for use by one's 
wholesale merchant or an affiliate's use) must occur solely by posting 
on the OASIS, and (3) once a discount is negotiated, details must be 
immediately posted on the OASIS. A discount agreed upon for an 
Ancillary Service must be offered for the same period to all Eligible 
Customers on the Transmission Provider's system. Sections 3.1 through 
3.6 below list the six Ancillary Services.
    3.1  Scheduling, System Control and Dispatch Service: The rates 
and/or methodology are described in Schedule 1.
    3.2  Reactive Supply and Voltage Control from Generation Sources 
Service: The rates and/or methodology are described in Schedule 2.
    3.3  Regulation and Frequency Response Service: Where applicable 
the rates and/or methodology are described in Schedule 3.
    3.4  Energy Imbalance Service: Where applicable the rates and/or 
methodology are described in Schedule 4.
    3.5  Operating Reserve--Spinning Reserve Service: Where applicable 
the rates and/or methodology are described in Schedule 5.
    3.6  Operating Reserve--Supplemental Reserve Service: Where 
applicable the rates and/or methodology are described in Schedule 6.

4  Open Access Same-Time Information System (OASIS)

    Terms and conditions regarding Open Access Same-Time Information 
System and standards of conduct are set forth in 18 CFR 37 of the 
Commission's regulations (Open Access Same-Time Information System and 
Standards of Conduct for Public Utilities). In the event available 
transmission capability as posted on the OASIS is insufficient to 
accommodate a request for firm transmission service, additional studies 
may be required as provided by this Tariff pursuant to Sections 19 and 
32.

5  Local Furnishing Bonds

5.1  Transmission Providers That Own Facilities Financed by Local 
Furnishing Bonds
    This provision is applicable only to Transmission Providers that 
have financed facilities for the local furnishing of electric energy 
with tax-exempt bonds, as described in Section 142(f) of the Internal 
Revenue Code (``local furnishing bonds''). Notwithstanding any other 
provision of this Tariff, the Transmission Provider shall not be 
required to provide transmission service to any Eligible Customer 
pursuant to this Tariff if the provision of such transmission service 
would jeopardize the tax-exempt status of any local furnishing bond(s) 
used to finance the Transmission Provider's facilities that would be 
used in providing such transmission service.
5.2  Alternative Procedures for Requesting Transmission Service
    (i) If the Transmission Provider determines that the provision of 
transmission service requested by an Eligible Customer would jeopardize 
the tax-exempt status of any local furnishing bond(s) used to finance 
its facilities that would be used in providing such transmission 
service, it shall advise the Eligible Customer within thirty (30) days 
of receipt of the Completed Application.
    (ii) If the Eligible Customer thereafter renews its request for the 
same transmission service referred to in (i) by tendering an 
application under Section 211 of the Federal Power Act, the 
Transmission Provider, within ten (10) days of receiving a copy of the 
Section 211 application, will waive its rights to a request for service 
under Section 213(a) of the Federal Power Act and to the issuance of a 
proposed order under Section 212(c) of the Federal Power Act. The 
Commission, upon receipt of the Transmission Provider's waiver of its 
rights to a request for service under Section 213(a) of the Federal 
Power Act and to the issuance of a proposed order under Section 212(c) 
of the Federal Power Act, shall issue an order under Section 211 of the 
Federal Power Act. Upon issuance of the order under Section 211 of the 
Federal Power Act, the Transmission Provider shall be required to 
provide the requested transmission service in accordance with the terms 
and conditions of this Tariff.

6  Reciprocity

    A Transmission Customer receiving transmission service under this 
Tariff agrees to provide comparable transmission service that it is 
capable of providing to the Transmission Provider on similar terms and 
conditions over facilities used for the transmission of electric energy 
owned, controlled or operated by the Transmission Customer and over 
facilities used for the transmission of electric energy owned, 
controlled or operated by the Transmission Customer's corporate

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affiliates. A Transmission Customer that is a member of a power pool or 
Regional Transmission Group also agrees to provide comparable 
transmission service to the members of such power pool and Regional 
Transmission Group on similar terms and conditions over facilities used 
for the transmission of electric energy owned, controlled or operated 
by the Transmission Customer and over facilities used for the 
transmission of electric energy owned, controlled or operated by the 
Transmission Customer's corporate affiliates.
    This reciprocity requirement applies not only to the Transmission 
Customer that obtains transmission service under the Tariff, but also 
to all parties to a transaction that involves the use of transmission 
service under the Tariff, including the power seller, buyer and any 
intermediary, such as a power marketer. This reciprocity requirement 
also applies to any Eligible Customer that owns, controls or operates 
transmission facilities that uses an intermediary, such as a power 
marketer, to request transmission service under the Tariff. If the 
Transmission Customer does not own, control or operate transmission 
facilities, it must include in its Application a sworn statement of one 
of its duly authorized officers or other representatives that the 
purpose of its Application is not to assist an Eligible Customer to 
avoid the requirements of this provision.

7  Billing and Payment

7.1  Billing Procedures
    Within a reasonable time after the first day of each month, the 
Transmission Provider shall submit an invoice to the Transmission 
Customer for the charges for all services furnished under the Tariff 
during the preceding month. The invoice shall be paid by the 
Transmission Customer within twenty (20) days of receipt. All payments 
shall be made in immediately available funds payable to the 
Transmission Provider, or by wire transfer to a bank named by the 
Transmission Provider.
7.2  Interest on Unpaid Balances
    Interest on any unpaid amounts (including amounts placed in escrow) 
shall be calculated in accordance with the methodology specified for 
interest on refunds in the Commission's regulations at 18 CFR 
35.19a(a)(2)(iii). Interest on delinquent amounts shall be calculated 
from the due date of the bill to the date of payment. When payments are 
made by mail, bills shall be considered as having been paid on the date 
of receipt by the Transmission Provider.
7.3  Customer Default
    In the event the Transmission Customer fails, for any reason other 
than a billing dispute as described below, to make payment to the 
Transmission Provider on or before the due date as described above, and 
such failure of payment is not corrected within thirty (30) calendar 
days after the Transmission Provider notifies the Transmission Customer 
to cure such failure, a default by the Transmission Customer shall be 
deemed to exist. Within the same 30 calendar days after notice of 
failure to make payment, the Transmission Customer shall have the right 
of appeal to the Administrator of Western. The Transmission Provider 
shall submit its recommendation to the Administrator for review and 
approval, but shall not terminate service until the Administrator makes 
a determination on the Transmission Customer's appeal. In the event of 
a billing dispute between the Transmission Provider and the 
Transmission Customer, the Transmission Provider will continue to 
provide service under the Service Agreement as long as the Transmission 
Customer (i) continues to make all payments not in dispute, and (ii) 
pays into an independent escrow account the portion of the invoice in 
dispute, pending resolution of such dispute. If the Transmission 
Customer fails to meet these two requirements for continuation of 
service, then the Transmission Provider may provide notice to the 
Transmission Customer of its intention to suspend service in sixty (60) 
days, in accordance with Commission policy.

8  Accounting for the Transmission Provider's Use of the Tariff

    The Transmission Provider shall record the following amounts, as 
outlined below.
8.1  Transmission Revenues
    Include in a separate operating revenue account or subaccount the 
revenues it receives from Transmission Service when making Third-Party 
Sales under Part II of the Tariff.
8.2  Study Costs and Revenues
    Include in a separate transmission operating expense account or 
subaccount, costs properly chargeable to expense that are incurred to 
perform any System Impact Studies or Facilities Studies which the 
Transmission Provider conducts to determine if it must construct new 
transmission facilities or upgrades necessary for its own uses, 
including making Third-Party Sales under the Tariff; and include in a 
separate operating revenue account or subaccount the revenues received 
for System Impact Studies or Facilities Studies performed when such 
amounts are separately stated and identified in the Transmission 
Customer's billing under the Tariff.

9  Regulatory Filings

    Nothing contained in the Tariff or any Service Agreement shall be 
construed as affecting in any way the ability of any Party receiving 
service under the Tariff to exercise its rights under the Federal Power 
Act and pursuant to the Commission's rules and regulations promulgated 
thereunder.

10  Force Majeure and Indemnification

10.1  Force Majeure
    An event of Force Majeure means any act of God, labor disturbance, 
act of the public enemy, war, insurrection, riot, fire, storm or flood, 
explosion, breakage or accident to machinery or equipment, any 
Curtailment, order, regulation or restriction imposed by governmental 
military or lawfully established civilian authorities, or any other 
cause beyond a Party's control. A Force Majeure event does not include 
an act of negligence or intentional wrongdoing. Neither the 
Transmission Provider nor the Transmission Customer will be considered 
in default as to any obligation under this Tariff if prevented from 
fulfilling the obligation due to an event of Force Majeure. However, a 
Party whose performance under this Tariff is hindered by an event of 
Force Majeure shall make all reasonable efforts to perform its 
obligations under this Tariff.
10.2  Indemnification
    The Transmission Customer shall at all times indemnify, defend, and 
save the Transmission Provider harmless from, any and all damages, 
losses, claims, including claims and actions relating to injury to or 
death of any person or damage to property, demands, suits, recoveries, 
costs and expenses, court costs, attorney fees, and all other 
obligations by or to third parties, arising out of or resulting from 
the Transmission Provider's performance of its obligations under this 
Tariff on behalf of the Transmission Customer, except in cases of 
negligence or intentional wrongdoing by the Transmission Provider. The 
liability of the Transmission Provider shall be determined in 
accordance with the provisions of the Federal Tort Claims Act, as 
amended.

[[Page 537]]

11  Creditworthiness

    For the purpose of determining the ability of the Transmission 
Customer to meet its obligations related to service hereunder, the 
Transmission Provider may require reasonable credit review procedures. 
This review shall be made in accordance with standard commercial 
practices. In addition, the Transmission Provider may require the 
Transmission Customer to provide and maintain in effect during the term 
of the Service Agreement, an unconditional and irrevocable letter of 
credit as security to meet its responsibilities and obligations under 
the Tariff, or an alternative form of security proposed by the 
Transmission Customer and acceptable to the Transmission Provider and 
consistent with commercial practices established by the Uniform 
Commercial Code that protects the Transmission Provider against the 
risk of non-payment.

12  Dispute Resolution Procedures

12.1  Internal Dispute Resolution Procedures
    Any dispute between a Transmission Customer and the Transmission 
Provider involving transmission service under the Tariff shall be 
referred to a designated senior representative of the Transmission 
Provider and a senior representative of the Transmission Customer for 
resolution on an informal basis as promptly as practicable. In the 
event the designated representatives are unable to resolve the dispute 
within thirty (30) days (or such other period as the Parties may agree 
upon) by mutual agreement, such dispute may be resolved in accordance 
with the procedures set forth below.
12.2  External Dispute Resolution Procedures
    Any complaint arising concerning implementation of this Tariff 
shall be resolved as follows:
    (a) Through a dispute resolution process, pursuant to the terms of 
a Regional Transmission Group governing agreement of which both Parties 
are members; or
    (b) If both Parties are not members of the same Regional 
Transmission Group, through a dispute resolution process agreed to by 
the Parties, or through a transmission complaint filed with the 
Commission to the extent the Commission has jurisdiction over such 
dispute.
12.3  Rights Under The Federal Power Act
    Nothing in this section shall restrict the rights of any party to 
file a Complaint with the Commission under relevant provisions of the 
Federal Power Act.

Part II. Point-to-Point Transmission Service

Preamble

    The Transmission Provider will provide Firm and Non-Firm Point-To-
Point Transmission Service pursuant to the applicable terms and 
conditions of this Tariff. Point-To-Point Transmission Service is for 
the receipt of capacity and energy at designated Point(s) of Receipt 
and the transmission of such capacity and energy to designated Point(s) 
of Delivery.

13  Nature of Firm Point-To-Point Transmission Service

13.1  Term
    The minimum term of Firm Point-To-Point Transmission Service shall 
be one day and the maximum term shall be specified in the Service 
Agreement.
13.2  Reservation Priority
    Long-Term Firm Point-To-Point Transmission Service shall be 
available on a first-come, first-served basis i.e., in the 
chronological sequence in which each Transmission Customer reserved 
service. Reservations for Short-Term Firm Point-To-Point Transmission 
Service will be conditional based upon the length of the requested 
transaction. If the Transmission System becomes oversubscribed, 
requests for longer term service may preempt requests for shorter term 
service up to the following deadlines; one day before the commencement 
of daily service, one week before the commencement of weekly service, 
and one month before the commencement of monthly service. Before the 
conditional reservation deadline, if available transmission capability 
is insufficient to satisfy all Applications, an Eligible Customer with 
a reservation for shorter term service has the right of first refusal 
to match any longer term reservation before losing its reservation 
priority. A longer term competing request for Short-Term Firm Point-To-
Point Transmission Service will be granted if the Eligible Customer 
with the right of first refusal does not agree to match the competing 
request within 24 hours (or earlier if necessary to comply with the 
scheduling deadlines provided in Section 13.8) from being notified by 
the Transmission Provider of a longer-term competing request for Short-
Term Firm Point-To-Point Transmission Service. After the conditional 
reservation deadline, service will commence pursuant to the terms of 
Part II of the Tariff. Firm Point-To-Point Transmission Service will 
always have a reservation priority over Non-Firm Point-To-Point 
Transmission Service under the Tariff. All Long-Term Firm Point-To-
Point Transmission Service will have equal reservation priority with 
Native Load Customers and Network Customers. Reservation priorities for 
existing firm service customers are provided in Section 2.2.
13.3  Use of Firm Transmission Service by the Transmission Provider
    The Transmission Provider will be subject to the rates, terms and 
conditions of Part II of the Tariff when making Third-Party Sales under 
agreements executed on or after March 9, 1998. The Transmission 
Provider will maintain separate accounting, pursuant to Section 8, for 
any use of the Point-To-Point Transmission Service to make Third-Party 
Sales.
13.4  Service Agreements
    The Transmission Provider shall offer a standard form Firm Point-
To-Point Transmission Service Agreement (Attachment A) to an Eligible 
Customer when it submits a Completed Application for Long-Term Firm 
Point-To-Point Transmission Service. The Transmission Provider shall 
offer a standard form Firm Point-to-Point Transmission Service 
Agreement (Attachment A) to an Eligible Customer when it first submits 
a Completed Application for Short-Term Firm Point-to-Point Transmission 
Service pursuant to the Tariff.
13.5 Transmission Customer Obligations for Facility Additions or 
Redispatch Costs
    In cases where the Transmission Provider determines that the 
Transmission System is not capable of providing Firm Point-To-Point 
Transmission Service without (1) degrading or impairing the reliability 
of service to Native Load Customers, Network Customers and other 
Transmission Customers taking Firm Point-To-Point Transmission Service, 
or (2) interfering with the Transmission Provider's ability to meet 
prior firm contractual commitments to others, the Transmission Provider 
will be obligated to expand or upgrade its Transmission System pursuant 
to the terms of Section 15.4. The Transmission Customer must agree to 
compensate the Transmission Provider in advance for any necessary 
transmission facility additions pursuant to the terms of Section 27. To 
the extent the Transmission Provider can relieve any system constraint 
more economically by redispatching the Transmission Provider's 
resources than

[[Page 538]]

through constructing Network Upgrades, it shall do so, provided that 
the Eligible Customer agrees to compensate the Transmission Provider 
pursuant to the terms of Section 27. Any redispatch, Network Upgrade or 
Direct Assignment Facilities costs to be charged to the Transmission 
Customer on an incremental basis under the Tariff will be specified in 
the Service Agreement or a separate agreement, as appropriate, prior to 
initiating service.
13.6 Curtailment of Firm Transmission Service
    In the event that a Curtailment on the Transmission Provider's 
Transmission System, or a portion thereof, is required to maintain 
reliable operation of such system, Curtailments will be made on a non-
discriminatory basis to the transaction(s) that effectively relieve the 
constraint. If multiple transactions require Curtailment, to the extent 
practicable and consistent with Good Utility Practice, the Transmission 
Provider will curtail service to Network Customers and Transmission 
Customers taking Firm Point-To-Point Transmission Service on a basis 
comparable to the curtailment of service to the Transmission Provider's 
Native Load Customers. All Curtailments will be made on a non-
discriminatory basis, however, Non-Firm Point-To-Point Transmission 
Service shall be subordinate to Firm Transmission Service. When the 
Transmission Provider determines that an electrical emergency exists on 
its Transmission System and implements emergency procedures to Curtail 
Firm Transmission Service, the Transmission Customer shall make the 
required reductions upon request of the Transmission Provider. However, 
the Transmission Provider reserves the right to Curtail, in whole or in 
part, any Firm Transmission Service provided under the Tariff when, in 
the Transmission Provider's sole discretion, an emergency or other 
unforeseen condition impairs or degrades the reliability of its 
Transmission System. The Transmission Provider will notify all affected 
Transmission Customers in a timely manner of any scheduled 
Curtailments.
13.7 Classification of Firm Transmission Service
    (a) The Transmission Customer taking Firm Point-To-Point 
Transmission Service may (1) change its Receipt and Delivery Points to 
obtain service on a non-firm basis consistent with the terms of Section 
22.1 or (2) request a modification of the Points of Receipt or Delivery 
on a firm basis pursuant to the terms of Section 22.2.
    (b) The Transmission Customer may purchase transmission service to 
make sales of capacity and energy from multiple generating units that 
are on the Transmission Provider's Transmission System. For such a 
purchase of transmission service, the resources will be designated as 
multiple Points of Receipt, unless the multiple generating units are at 
the same generating plant in which case the units would be treated as a 
single Point of Receipt.
    (c) The Transmission Provider shall provide firm deliveries of 
capacity and energy from the Point(s) of Receipt to the Point(s) of 
Delivery. Each Point of Receipt at which firm transmission capacity is 
reserved by the Transmission Customer shall be set forth in the Firm 
Point-To-Point Service Agreement for Long-Term Firm Transmission 
Service along with a corresponding capacity reservation associated with 
each Point of Receipt. Points of Receipt and corresponding capacity 
reservations shall be as mutually agreed upon by the Parties for Short-
Term Firm Transmission. Each Point of Delivery at which firm 
transmission capacity is reserved by the Transmission Customer shall be 
set forth in the Firm Point-To-Point Service Agreement for Long-Term 
Firm Transmission Service along with a corresponding capacity 
reservation associated with each Point of Delivery. Points of Delivery 
and corresponding capacity reservations shall be as mutually agreed 
upon by the Parties for Short-Term Firm Transmission. The greater of 
either (1) the sum of the capacity reservations at the Point(s) of 
Receipt, or (2) the sum of the capacity reservations at the Point(s) of 
Delivery shall be the Transmission Customer's Reserved Capacity. The 
Transmission Customer will be billed for its Reserved Capacity under 
the terms of Schedule 7. The Transmission Customer may not exceed its 
firm capacity reserved at each Point of Receipt and each Point of 
Delivery except as otherwise specified in Section 22. The Transmission 
Provider shall specify the rate treatment and all related terms and 
conditions applicable in the event that a Transmission Customer, 
(including Third-Party Sales by the Transmission Provider) exceeds its 
firm reserved capacity at any Point of Receipt or Point of Delivery.
13.8 Scheduling of Firm Point-To-Point Transmission Service
    Schedules for the Transmission Customer's Firm Point-To-Point 
Transmission Service must be submitted to the Transmission Provider no 
later than 10:00 a.m. (or a reasonable time that is generally accepted 
in the region and is consistently adhered to by the Transmission 
Provider) of the day prior to commencement of such service. Schedules 
submitted after 10:00 a.m. will be accommodated, if practicable. Hour-
to-hour schedules of any capacity and energy that is to be delivered 
must be stated in increments of 1,000 kW per hour (or a reasonable 
increment that is generally accepted in the region and is consistently 
adhered to by the Transmission Provider). Transmission Customers within 
the Transmission Provider's service area with multiple requests for 
Transmission Service at a Point of Receipt, each of which is under 
1,000 kW per hour, may consolidate their service requests at a common 
point of receipt into units of 1,000 kW per hour for scheduling and 
billing purposes. Scheduling changes will be permitted up to twenty 
(20) minutes (or a reasonable time that is generally accepted in the 
region and is consistently adhered to by the Transmission Provider) 
before the start of the next clock hour provided that the Delivering 
Party and Receiving Party also agree to the schedule modification. The 
Transmission Provider will furnish to the Delivering Party's system 
operator, hour-to-hour schedules equal to those furnished by the 
Receiving Party (unless reduced for losses) and shall deliver the 
capacity and energy provided by such schedules. Should the Transmission 
Customer, Delivering Party or Receiving Party revise or terminate any 
schedule, such party shall immediately notify the Transmission 
Provider, and the Transmission Provider shall have the right to adjust 
accordingly the schedule for capacity and energy to be received and to 
be delivered.

14 Nature of Non-Firm Point-To-Point Transmission Service

14.1 Term
    Non-Firm Point-To-Point Transmission Service will be available for 
periods ranging from one (1) hour to one (1) month. However, a 
Purchaser of Non-Firm Point-To-Point Transmission Service will be 
entitled to reserve a sequential term of service (such as a sequential 
monthly term without having to wait for the initial term to expire 
before requesting another monthly term) so that the total time period 
for which the reservation applies is greater than one month, subject to 
the requirements of Section 18.3.
14.2  Reservation Priority
    Non-Firm Point-To-Point Transmission Service shall be available 
from transmission capability in excess

[[Page 539]]

of that needed for reliable service to Native Load Customers, Network 
Customers and other Transmission Customers taking Long-Term and Short-
Term Firm Point-To-Point Transmission Service. A higher priority will 
be assigned to reservations with a longer duration of service. In the 
event the Transmission System is constrained, competing requests of 
equal duration will be prioritized based on the highest price offered 
by the Eligible Customer for the Transmission Service. Eligible 
Customers that have already reserved shorter term service have the 
right of first refusal to match any longer term reservation before 
being preempted. A longer term competing request for Non-Firm Point-To-
Point Transmission Service will be granted if the Eligible Customer 
with the right of first refusal does not agree to match the competing 
request: (a) Immediately for hourly Non-Firm Point-To-Point 
Transmission Service after notification by the Transmission Provider; 
and, (b) within 24 hours (or earlier if necessary to comply with the 
scheduling deadlines provided in Section 14.6) for Non-Firm Point-To-
Point Transmission Service other than hourly transactions after 
notification by the Transmission Provider. Transmission service for 
Network Customers from resources other than designated Network 
Resources will have a higher priority than any Non-Firm Point-To-Point 
Transmission Service. Non-Firm Point-To-Point Transmission Service over 
secondary Point(s) of Receipt and Point(s) of Delivery will have the 
lowest reservation priority under the Tariff.
14.3  Use of Non-Firm Point-To-Point Transmission Service by the 
Transmission Provider
    The Transmission Provider will be subject to the rates, terms and 
conditions of Part II of the Tariff when making Third-Party Sales under 
agreements executed on or after March 9, 1998. The Transmission 
Provider will maintain separate accounting, pursuant to Section 8, for 
any use of Non-Firm Point-To-Point Transmission Service to make Third-
Party Sales.
14.4  Service Agreements
    The Transmission Provider shall offer a standard form Non-Firm 
Point-To-Point Transmission Service Agreement (Attachment B) to an 
Eligible Customer when it first submits a Completed Application for 
Non-Firm Point-To-Point Transmission Service pursuant to the Tariff.
14.5  Classification of Non-Firm Point-To-Point Transmission Service
    Non-Firm Point-To-Point Transmission Service shall be offered under 
terms and conditions contained in Part II of the Tariff. The 
Transmission Provider undertakes no obligation under the Tariff to plan 
its Transmission System in order to have sufficient capacity for Non-
Firm Point-To-Point Transmission Service. Parties requesting Non-Firm 
Point-To-Point Transmission Service for the transmission of firm power 
do so with the full realization that such service is subject to 
availability and to Curtailment or Interruption under the terms of the 
Tariff. The Transmission Provider shall specify the rate treatment and 
all related terms and conditions applicable in the event that a 
Transmission Customer (including Third-Party Sales by the Transmission 
Provider) exceeds its non-firm capacity reservation. Non-Firm Point-To-
Point Transmission Service shall include transmission of energy on an 
hourly basis and transmission of scheduled short-term capacity and 
energy on a daily, weekly or monthly basis, but not to exceed one 
month's reservation for any one Application under Schedule 8.
14.6  Scheduling of Non-Firm Point-To-Point Transmission Service
    Schedules for Non-Firm Point-To-Point Transmission Service must be 
submitted to the Transmission Provider no later than 2:00 p.m. (or a 
reasonable time that is generally accepted in the region and is 
consistently adhered to by the Transmission Provider) of the day prior 
to commencement of such service. Schedules submitted after 2:00 p.m. 
will be accommodated, if practicable. Hour-to-hour schedules of energy 
that are to be delivered must be stated in increments of 1,000 kW per 
hour (or a reasonable increment that is generally accepted in the 
region and is consistently adhered to by the Transmission Provider). 
Transmission Customers within the Transmission Provider's service area 
with multiple requests for Transmission Service at a Point of Receipt, 
each of which is under 1,000 kW per hour, may consolidate their 
schedules at a common Point of Receipt into units of 1,000 kW per hour. 
Scheduling changes will be permitted up to twenty (20) minutes (or a 
reasonable time that is generally accepted in the region and is 
consistently adhered to by the Transmission Provider) before the start 
of the next clock hour provided that the Delivering Party and Receiving 
Party also agree to the schedule modification. The Transmission 
Provider will furnish to the Delivering Party's system operator, hour-
to-hour schedules equal to those furnished by the Receiving Party 
(unless reduced for losses) and shall deliver the capacity and energy 
provided by such schedules. Should the Transmission Customer, 
Delivering Party or Receiving Party revise or terminate any schedule, 
such party shall immediately notify the Transmission Provider, and the 
Transmission Provider shall have the right to adjust accordingly the 
schedule for capacity and energy to be received and to be delivered.
14.7  Curtailment or Interruption of Service
    The Transmission Provider reserves the right to Curtail, in whole 
or in part, Non-Firm Point-To-Point Transmission Service provided under 
the Tariff for reliability reasons when, an emergency or other 
unforeseen condition threatens to impair or degrade the reliability of 
its Transmission System. The Transmission Provider reserves the right 
to Interrupt, in whole or in part, Non-Firm Point-To-Point Transmission 
Service provided under the Tariff for economic reasons in order to 
accommodate (1) a request for Firm Transmission Service, (2) a request 
for Non-Firm Point-To-Point Transmission Service of greater duration, 
(3) a request for Non-Firm Point-To-Point Transmission Service of equal 
duration with a higher price, or (4) transmission service for Network 
Customers from non-designated resources. The Transmission Provider also 
will discontinue or reduce service to the Transmission Customer to the 
extent that deliveries for transmission are discontinued or reduced at 
the Point(s) of Receipt. Where required, Curtailments or Interruptions 
will be made on a non-discriminatory basis to the transaction(s) that 
effectively relieve the constraint, however, Non-Firm Point-To-Point 
Transmission Service shall be subordinate to Firm Transmission Service. 
If multiple transactions require Curtailment or Interruption, to the 
extent practicable and consistent with Good Utility Practice, 
Curtailments or Interruptions will be made to transactions of the 
shortest term (e.g., hourly non-firm transactions will be Curtailed or 
Interrupted before daily non-firm transactions and daily non-firm 
transactions will be Curtailed or Interrupted before weekly non-firm 
transactions). Transmission service for Network Customers from 
resources other than designated Network Resources will have a higher 
priority than any Non-Firm Point-To-Point

[[Page 540]]

Transmission Service under the Tariff. Non-Firm Point-To-Point 
Transmission Service over secondary Point(s) of Receipt and Point(s) of 
Delivery will have a lower priority than any Non-Firm Point-To-Point 
Transmission Service under the Tariff. The Transmission Provider will 
provide advance notice of Curtailment or Interruption where such notice 
can be provided consistent with Good Utility Practice.

15  Service Availability

15.1  General Conditions
    The Transmission Provider will provide Firm and Non-Firm Point-To-
Point Transmission Service over, on or across its Transmission System 
to any Transmission Customer that has met the requirements of Section 
16.
15.2  Determination of Available Transmission Capability
    A description of the Transmission Provider's specific methodology 
for assessing available transmission capability posted on the 
Transmission Provider's OASIS (Section 4) is contained in Attachment C 
of the Tariff. In the event sufficient transmission capability may not 
exist to accommodate a service request, the Transmission Provider will 
respond by performing a System Impact Study.
15.3  Initiating Service in the Absence of an Executed Service 
Agreement
    If the Transmission Provider and the Transmission Customer 
requesting Firm or Non-Firm Point-To-Point Transmission Service cannot 
agree on all the terms and conditions of the Point-To-Point Service 
Agreement, the Transmission Provider shall commence providing 
Transmission Service subject to the Transmission Customer agreeing to 
(i) compensate the Transmission Provider at the existing rate placed in 
effect pursuant to applicable Federal law and regulations, and (ii) 
comply with the terms and conditions of the Tariff including paying the 
appropriate processing fees in accordance with the terms of Section 
17.3. If the Transmission Customer cannot accept all of the terms and 
conditions of the offered Service Agreement, the Transmission Customer 
may request resolution of the unacceptable terms and conditions under 
Section 12, Dispute Resolution Procedures, of the Tariff. Any changes 
resulting from the Dispute Resolution Procedures will be effective upon 
the date of initial service.
15.4  Obligation to Provide Transmission Service that Requires 
Expansion or Modification of the Transmission System
    If the Transmission Provider determines that it cannot accommodate 
a Completed Application for Firm Point-To-Point Transmission Service 
because of insufficient capability on its Transmission System, the 
Transmission Provider will use due diligence to expand or modify its 
Transmission System to provide the requested Firm Transmission Service, 
provided the Transmission Customer agrees to compensate the 
Transmission Provider in advance for such costs pursuant to the terms 
of Section 27. The Transmission Provider will conform to Good Utility 
Practice in determining the need for new facilities and in the design 
and construction of such facilities. The obligation applies only to 
those facilities that the Transmission Provider has the right to expand 
or modify.
15.5  Deferral of Service
    The Transmission Provider may defer providing service until it 
completes construction of new transmission facilities or upgrades 
needed to provide Firm Point-To-Point Transmission Service whenever the 
Transmission Provider determines that providing the requested service 
would, without such new facilities or upgrades, impair or degrade 
reliability to any existing firm services.
15.6  Other Transmission Service Schedules
    Eligible Customers receiving transmission service under other 
agreements on file with the Commission may continue to receive 
transmission service under those agreements until such time as those 
agreements may be modified by the Commission.
15.7  Real Power Losses
    Real Power Losses are associated with all transmission service. The 
Transmission Provider is not obligated to provide Real Power Losses. 
The Transmission Customer is responsible for replacing losses 
associated with all transmission service as calculated by the 
Transmission Provider. The applicable Real Power Loss factors are 
specified in the Service Agreements.

16  Transmission Customer Responsibilities

16.1  Conditions Required of Transmission Customers
    Point-To-Point Transmission Service shall be provided by the 
Transmission Provider only if the following conditions are satisfied by 
the Transmission Customer:
    a. The Transmission Customer has pending a Completed Application 
for service;
    b. The Transmission Customer meets the creditworthiness criteria 
set forth in Section 11;
    c. The Transmission Customer will have arrangements in place for 
any other transmission service necessary to effect the delivery from 
the generating source to the Transmission Provider prior to the time 
service under Part II of the Tariff commences;
    d. The Transmission Customer agrees to pay for any facilities 
constructed and chargeable to such Transmission Customer under Part II 
of the Tariff, whether or not the Transmission Customer takes service 
for the full term of its reservation; and
    e. The Transmission Customer has executed a Point-To-Point Service 
Agreement or has agreed to receive service pursuant to Section 15.3.
16.2  Transmission Customer Responsibility for Third-Party Arrangements
    Any scheduling arrangements that may be required by other electric 
systems shall be the responsibility of the Transmission Customer 
requesting service. The Transmission Customer shall provide, unless 
waived by the Transmission Provider, notification to the Transmission 
Provider identifying such systems and authorizing them to schedule the 
capacity and energy to be transmitted by the Transmission Provider 
pursuant to Part II of the Tariff on behalf of the Receiving Party at 
the Point of Delivery or the Delivering Party at the Point of Receipt. 
However, the Transmission Provider will undertake reasonable efforts to 
assist the Transmission Customer in making such arrangements, including 
without limitation, providing any information or data required by such 
other electric system pursuant to Good Utility Practice.

17 Procedures for Arranging Firm Point-To-Point Transmission Service

17.1  Application
    A request for Firm Point-To-Point Transmission Service for periods 
of one year or longer must contain a written Application to the 
appropriate Regional Office, as identified in Attachment K to the 
Tariff, at least sixty (60) days in advance of the calendar month in 
which service is to commence. The Transmission Provider will consider 
requests for such firm service on shorter notice when feasible. 
Requests for firm

[[Page 541]]

service for periods of less than one year shall be subject to expedited 
procedures that shall be negotiated between the Parties within the time 
constraints provided in Section 17.5. All Firm Point-To-Point 
Transmission Service requests should be submitted by entering the 
information listed below on the Transmission Provider's OASIS. Prior to 
implementation of the Transmission Provider's OASIS, a Completed 
Application may be submitted by (i) transmitting the required 
information to the Transmission Provider by telefax, or (ii) providing 
the information by telephone over the Transmission Provider's time 
recorded telephone line. Each of these methods will provide a time-
stamped record for establishing the priority of the Application.
17.2  Completed Application
    A Completed Application shall provide all of the information 
included in 18 CFR 2.20 including but not limited to the following:
    (i) The identity, address, telephone number and facsimile number of 
the entity requesting service;
    (ii) A statement that the entity requesting service is, or will be 
upon commencement of service, an Eligible Customer under the Tariff;
    (iii) The location of the Point(s) of Receipt and Point(s) of 
Delivery and the identities of the Delivering Parties and the Receiving 
Parties;
    (iv) The location of the generating facility(ies) supplying the 
capacity and energy and the location of the load ultimately served by 
the capacity and energy transmitted. The Transmission Provider will 
treat this information as confidential except to the extent that 
disclosure of this information is required by the Tariff, by Federal 
law, by regulatory or judicial order, for reliability purposes pursuant 
to Good Utility Practice or pursuant to RTG transmission information 
sharing agreements. The Transmission Provider shall treat this 
information consistent with the standards of conduct contained in Part 
37 of the Commission's regulations;
    (v) A description of the supply characteristics of the capacity and 
energy to be delivered;
    (vi) An estimate of the capacity and energy expected to be 
delivered to the Receiving Party;
    (vii) The Service Commencement Date and the term of the requested 
Transmission Service;
    (viii) The transmission capacity requested for each Point of 
Receipt and each Point of Delivery on the Transmission Provider's 
Transmission System; customers may combine their requests for service 
in order to satisfy the minimum transmission capacity requirement;
    The Transmission Provider shall treat this information consistent 
with the standards of conduct contained in Part 37 of the Commission's 
regulations.
17.3  Processing Fee
    A Completed Application for Firm Point-To-Point Transmission 
Service also shall include a non-refundable processing fee. Such fee 
shall be applicable to all Transmission Customers for firm Transmission 
Service requests of one year or longer. Individual Transmission 
Provider processing fees will be calculated using the number of 
estimated hours it will take to process an application and will be set 
forth in Attachment K. This fee does not apply to costs to complete 
System Impact Studies or Facility Studies or to add new facilities.
17.4  Notice of Deficient Application
    If an Application fails to meet the requirements of the Tariff, the 
Transmission Provider shall notify the entity requesting service within 
fifteen (15) days of receipt of the reasons for such failure. The 
Transmission Provider will attempt to remedy minor deficiencies in the 
Application through informal communications with the Eligible Customer. 
If such efforts are unsuccessful, the Transmission Provider shall 
return the Application. Upon receipt of a new or revised Application 
that fully complies with the requirements of Part II of the Tariff, the 
Eligible Customer shall be assigned a new priority consistent with the 
date of the new or revised Application.
17.5  Response to a Completed Application
    Following receipt of a Completed Application for Firm Point-To-
Point Transmission Service, the Transmission Provider shall make a 
determination of available transmission capability as required in 
Section 15.2. The Transmission Provider shall notify the Eligible 
Customer as soon as practicable, but not later than thirty (30) days 
after the date of receipt of a Completed Application either (i) if it 
will be able to provide service without performing a System Impact 
Study or (ii) if such a study is needed to evaluate the impact of the 
Application pursuant to Section 19.1. Responses by the Transmission 
Provider must be made as soon as practicable to all completed 
applications (including applications by its own merchant function) and 
the timing of such responses must be made on a non-discriminatory 
basis.
17.6  Execution of a Service Agreement
    Whenever the Transmission Provider determines that a System Impact 
Study is not required and that the service can be provided, it shall 
notify the Eligible Customer as soon as practicable but no later than 
thirty (30) days after receipt of the Completed Application. Where a 
System Impact Study is required, the provisions of Section 19 will 
govern the execution of a Service Agreement. Failure of an Eligible 
Customer to execute and return the Service Agreement or request service 
without an executed Service Agreement pursuant to Section 15.3, within 
fifteen (15) days after it is tendered by the Transmission Provider 
will be deemed a withdrawal and termination of the Application. Nothing 
herein limits the right of an Eligible Customer to file another 
Application after such withdrawal and termination.
17.7  Extensions for Commencement of Service
    The Transmission Customer can obtain up to five (5) one-year 
extensions for the commencement of service. The Transmission Customer 
may postpone service by paying a non-refundable annual reservation fee 
equal to one-month's charge for Firm Transmission Service for each year 
or fraction thereof. If during any extension for the commencement of 
service an Eligible Customer submits a Completed Application for Firm 
Transmission Service, and such request can be satisfied only by 
releasing all or part of the Transmission Customer's Reserved Capacity, 
the original Reserved Capacity will be released unless the following 
condition is satisfied. Within thirty (30) days, the original 
Transmission Customer agrees to pay the Firm Point-To-Point 
transmission rate for its Reserved Capacity concurrent with the new 
Service Commencement Date. In the event the Transmission Customer 
elects to release the Reserved Capacity, the reservation fees or 
portions thereof previously paid will be forfeited.

18  Procedures for Arranging Non-Firm Point-To-Point Transmission 
Service

18.1  Application
    Eligible Customers seeking Non-Firm Point-To-Point Transmission 
Service must submit a Completed Application to the Transmission 
Provider. Applications should be submitted by entering the information 
listed below on the Transmission Provider's OASIS. Prior to 
implementation of the

[[Page 542]]

Transmission Provider's OASIS, a Completed Application may be submitted 
by (i) transmitting the required information to the Transmission 
Provider by telefax, or (ii) providing the information by telephone 
over the Transmission Provider's time recorded telephone line. Each of 
these methods will provide a time-stamped record for establishing the 
service priority of the Application.
18.2  Completed Application
    A Completed Application shall provide all of the information 
included in 18 CFR Sec. 2.20 including but not limited to the 
following:
    (i) The identity, address, telephone number and facsimile number of 
the entity requesting service;
    (ii) A statement that the entity requesting service is, or will be 
upon commencement of service, an Eligible Customer under the Tariff;
    (iii) The Point(s) of Receipt and the Point(s) of Delivery;
    (iv) The maximum amount of capacity requested at each Point of 
Receipt and Point of Delivery; and
    (v) The proposed dates and hours for initiating and terminating 
transmission service hereunder.
    In addition to the information specified above, when required to 
properly evaluate system conditions, the Transmission Provider also may 
ask the Transmission Customer to provide the following:
    (vi) The electrical location of the initial source of the power to 
be transmitted pursuant to the Transmission Customer's request for 
service;
    (vii) The electrical location of the ultimate load.
    The Transmission Provider will treat this information in (vi) and 
(vii) as confidential at the request of the Transmission Customer 
except to the extent that disclosure of this information is required by 
this Tariff, by Federal Law, by regulatory or judicial order, for 
reliability purposes pursuant to Good Utility Practice, or pursuant to 
RTG transmission information sharing agreements. The Transmission 
Provider shall treat this information consistent with the standards of 
conduct contained in Part 37 of the Commission's regulations.
18.3  Reservation of Non-Firm Point-To-Point Transmission Service
    Requests for monthly service shall be submitted no earlier than 
sixty (60) days before service is to commence; requests for weekly 
service shall be submitted no earlier than fourteen (14) days before 
service is to commence, requests for daily service shall be submitted 
no earlier than two (2) days before service is to commence, and 
requests for hourly service shall be submitted no earlier than noon the 
day before service is to commence. Requests for service received later 
than 2:00 p.m. prior to the day service is scheduled to commence will 
be accommodated if practicable [or such reasonable times that are 
generally accepted in the region and are consistently adhered to by the 
Transmission Provider].
    18.4  Determination of Available Transmission Capability
    Following receipt of a tendered schedule the Transmission Provider 
will make a determination on a non-discriminatory basis of available 
transmission capability pursuant to Section 15.2. Such determination 
shall be made as soon as reasonably practicable after receipt, but not 
later than the following time periods for the following terms of 
service (i) thirty (30) minutes for hourly service, (ii) thirty (30) 
minutes for daily service, (iii) four (4) hours for weekly service, and 
(iv) two (2) days for monthly service. [Or such reasonable times that 
are generally accepted in the region and are consistently adhered to by 
the Transmission Provider].

19  Additional Study Procedures For Firm Point-To-Point Transmission 
Service Requests

19.1  Notice of Need for System Impact Study
    After receiving a request for service, the Transmission Provider 
shall determine on a non-discriminatory basis whether a System Impact 
Study is needed. A description of the Transmission Provider's 
methodology for completing a System Impact Study is provided in 
Attachment D. If the Transmission Provider determines that a System 
Impact Study is necessary to accommodate the requested service, it 
shall so inform the Eligible Customer, as soon as practicable. In such 
cases, the Transmission Provider shall within thirty (30) days of 
receipt of a Completed Application, tender a System Impact Study 
Agreement pursuant to which the Eligible Customer shall agree to 
advance funds to the Transmission Provider for performing the required 
System Impact Study. For a service request to remain a Completed 
Application, the Eligible Customer shall execute the System Impact 
Study Agreement and return it to the Transmission Provider within 
fifteen (15) days. If the Eligible Customer elects not to execute the 
System Impact Study Agreement, its application shall be deemed 
withdrawn.
19.2  System Impact Study Agreement and Compensation:
    (i) The System Impact Study Agreement will clearly specify the 
Transmission Provider's estimate of the actual cost, and time for 
completion of the System Impact Study. The charge will not exceed the 
actual cost of the study. In performing the System Impact Study, the 
Transmission Provider shall rely, to the extent reasonably practicable, 
on existing transmission planning studies. The Eligible Customer will 
not be assessed a charge for such existing studies; however, the 
Eligible Customer will be responsible for charges associated with any 
modifications to existing planning studies that are reasonably 
necessary to evaluate the impact of the Eligible Customer's request for 
service on the Transmission System.
    (ii) If in response to multiple Eligible Customers requesting 
service in relation to the same competitive solicitation, a single 
System Impact Study is sufficient for the Transmission Provider to 
accommodate the requests for service, the costs of that study shall be 
pro-rated among the Eligible Customers.
    (iii) For System Impact Studies that the Transmission Provider 
conducts on its own behalf, the Transmission Provider shall record the 
cost of the System Impact Studies pursuant to Section 8.
19.3  System Impact Study Procedures
    Upon receipt of an executed System Impact Study Agreement, the 
Transmission Provider will use due diligence to complete the required 
System Impact Study within a sixty (60) day period. The System Impact 
Study shall identify any system constraints and redispatch options, 
additional Direct Assignment Facilities or Network Upgrades required to 
provide the requested service. In the event that the Transmission 
Provider is unable to complete the required System Impact Study within 
such time period, it shall so notify the Eligible Customer and provide 
an estimated completion date along with an explanation of the reasons 
why additional time is required to complete the required studies. A 
copy of the completed System Impact Study and related work papers shall 
be made available to the Eligible Customer. The Transmission Provider 
will use the same due diligence in completing the System Impact Study 
for an Eligible Customer as it uses when completing studies for itself. 
The Transmission Provider shall notify the Eligible

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Customer immediately upon completion of the System Impact Study if the 
Transmission System will be adequate to accommodate all or part of a 
request for service or that no costs are likely to be incurred for new 
transmission facilities or upgrades. In order for a request to remain a 
Completed Application, within fifteen (15) days of completion of the 
System Impact Study the Eligible Customer must execute a Service 
Agreement or request service without an executed Service Agreement 
pursuant to Section 15.3, or the Application shall be deemed terminated 
and withdrawn.
19.4  Facilities Study Procedures
    If a System Impact Study indicates that additions or upgrades to 
the Transmission System are needed to supply the Eligible Customer's 
service request, the Transmission Provider, within thirty (30) days of 
the completion of the System Impact Study, shall tender to the Eligible 
Customer a Facilities Study Agreement pursuant to which the Eligible 
Customer shall agree to advance funds to the Transmission Provider for 
performing the required Facilities Study. For a service request to 
remain a Completed Application, the Eligible Customer shall execute the 
Facilities Study Agreement and return it to the Transmission Provider 
within fifteen (15) days. If the Eligible Customer elects not to 
execute the Facilities Study Agreement, its application shall be deemed 
withdrawn. Upon receipt of an executed Facilities Study Agreement, the 
Transmission Provider will use due diligence to complete the required 
Facilities Study within a sixty (60) day period. If the Transmission 
Provider is unable to complete the Facilities Study in the allotted 
time period, the Transmission Provider shall notify the Transmission 
Customer and provide an estimate of the time needed to reach a final 
determination along with an explanation of the reasons that additional 
time is required to complete the study. When completed, the Facilities 
Study will include a good faith estimate of (i) the cost of Direct 
Assignment Facilities to be charged to the Transmission Customer, (ii) 
the Transmission Customer's appropriate share of the cost of any 
required Network Upgrades as determined pursuant to the provisions of 
Part II of the Tariff, and (iii) the time required to complete such 
construction and initiate the requested service. The Transmission 
Customer shall pay the Transmission Provider in advance Transmission 
Customer's share of the costs of new facilities or upgrades. The 
Transmission Customer shall have thirty (30) days to execute a 
construction agreement and a Service Agreement and provide the advance 
payment or request service without an executed Service Agreement 
pursuant to Section 15.3 and pay the Transmission Customer's share of 
the costs or the request will no longer be a Completed Application and 
shall be deemed terminated and withdrawn. Any advance payment made by 
the Transmission Customer that is in excess of the costs incurred by 
the Transmission Provider shall be refunded.
19.5  Facilities Study Modifications
    Any change in design arising from inability to site or construct 
facilities as proposed will require development of a revised good faith 
estimate. New good faith estimates also will be required in the event 
of new statutory or regulatory requirements that are effective before 
the completion of construction or other circumstances beyond the 
control of the Transmission Provider that significantly affect the 
final cost of new facilities or upgrades to be charged to the 
Transmission Customer pursuant to the provisions of Part II of the 
Tariff.
19.6  Due Diligence in Completing New Facilities
    The Transmission Provider shall use due diligence to add necessary 
facilities or upgrade its Transmission System within a reasonable time. 
The Transmission Provider will not upgrade its existing or planned 
Transmission System in order to provide the requested Firm Point-To-
Point Transmission Service if doing so would impair system reliability 
or otherwise impair or degrade existing firm service.
19.7  Partial Interim Service
    If the Transmission Provider determines that it will not have 
adequate transmission capability to satisfy the full amount of a 
Completed Application for Firm Point-To-Point Transmission Service, the 
Transmission Provider nonetheless shall be obligated to offer and 
provide the portion of the requested Firm Point-To-Point Transmission 
Service that can be accommodated without addition of any facilities and 
through redispatch. However, the Transmission Provider shall not be 
obligated to provide the incremental amount of requested Firm Point-To-
Point Transmission Service that requires the addition of facilities or 
upgrades to the Transmission System until such facilities or upgrades 
have been placed in service.
19.8  Expedited Procedures for New Facilities
    In lieu of the procedures set forth above, the Eligible Customer 
shall have the option to expedite the process by requesting the 
Transmission Provider to tender at one time, together with the results 
of required studies, an ``Expedited Service Agreement'' pursuant to 
which the Eligible Customer would agree to compensate the Transmission 
Provider in advance for all costs incurred pursuant to the terms of the 
Tariff. In order to exercise this option, the Eligible Customer shall 
request in writing an expedited Service Agreement covering all of the 
above-specified items within thirty (30) days of receiving the results 
of the System Impact Study identifying needed facility additions or 
upgrades or costs incurred in providing the requested service. While 
the Transmission Provider agrees to provide the Eligible Customer with 
its best estimate of the new facility costs and other charges that may 
be incurred, such estimate shall not be binding and the Eligible 
Customer must agree in writing to compensate the Transmission Provider 
in advance for all costs incurred pursuant to the provisions of the 
Tariff. The Eligible Customer shall execute and return such an 
Expedited Service Agreement within fifteen (15) days of its receipt or 
the Eligible Customer's request for service will cease to be a 
Completed Application and will be deemed terminated and withdrawn.

20  Procedures if The Transmission Provider is Unable to Complete New 
Transmission Facilities for Firm Point-To-Point Transmission Service

20.1  Delays in Construction of New Facilities
    If any event occurs that will materially affect the time for 
completion of new facilities, or the ability to complete them, the 
Transmission Provider shall promptly notify the Transmission Customer. 
In such circumstances, the Transmission Provider shall within thirty 
(30) days of notifying the Transmission Customer of such delays, 
convene a technical meeting with the Transmission Customer to evaluate 
the alternatives available to the Transmission Customer. The 
Transmission Provider also shall make available to the Transmission 
Customer studies and work papers related to the delay, including all 
information that is in the possession of the Transmission Provider that 
is reasonably needed by the Transmission Customer to evaluate any 
alternatives.

[[Page 544]]

20.2  Alternatives to the Original Facility Additions
    When the review process of Section 20.1 determines that one or more 
alternatives exist to the originally planned construction project, the 
Transmission Provider shall present such alternatives for consideration 
by the Transmission Customer. If, upon review of any alternatives, the 
Transmission Customer desires to maintain its Completed Application 
subject to construction of the alternative facilities, it may request 
the Transmission Provider to submit a revised Service Agreement for 
Firm Point-To-Point Transmission Service. If the alternative approach 
solely involves Non-Firm Point-To-Point Transmission Service, the 
Transmission Provider shall promptly tender a Service Agreement for 
Non-Firm Point-To-Point Transmission Service providing for the service. 
In the event the Transmission Provider concludes that no reasonable 
alternative exists and the Transmission Customer disagrees, the 
Transmission Customer may seek relief under the dispute resolution 
procedures pursuant to Section 12 or it may refer the dispute to the 
Commission for resolution.
20.3  Refund Obligation for Unfinished Facility Additions
    If the Transmission Provider and the Transmission Customer mutually 
agree that no other reasonable alternatives exist and the requested 
service cannot be provided out of existing capability under the 
conditions of Part II of the Tariff, the obligation to provide the 
requested Firm Point-To-Point Transmission Service shall terminate and 
any advance payment made by the Transmission Customer that is in excess 
of the costs incurred by the Transmission Provider through the time 
construction was suspended shall be returned. However, the Transmission 
Customer shall be responsible for all prudently incurred costs by the 
Transmission Provider through the time construction was suspended.

21  Provisions Relating to Transmission Construction and Services on 
the Systems of Other Utilities

21.1  Responsibility for Third-Party System Additions
    The Transmission Provider shall not be responsible for making 
arrangements for any necessary engineering, permitting, and 
construction of transmission or distribution facilities on the 
system(s) of any other entity or for obtaining any regulatory approval 
for such facilities. The Transmission Provider will undertake 
reasonable efforts to assist the Transmission Customer in obtaining 
such arrangements, including without limitation, providing any 
information or data required by such other electric system pursuant to 
Good Utility Practice.
21.2  Coordination of Third-Party System Additions
    In circumstances where the need for transmission facilities or 
upgrades is identified pursuant to the provisions of Part II of the 
Tariff, and if such upgrades further require the addition of 
transmission facilities on other systems, the Transmission Provider 
shall have the right to coordinate construction on its own system with 
the construction required by others. The Transmission Provider, after 
consultation with the Transmission Customer and representatives of such 
other systems, may defer construction of its new transmission 
facilities, if the new transmission facilities on another system cannot 
be completed in a timely manner. The Transmission Provider shall notify 
the Transmission Customer in writing of the basis for any decision to 
defer construction and the specific problems which must be resolved 
before it will initiate or resume construction of new facilities. 
Within sixty (60) days of receiving written notification by the 
Transmission Provider of its intent to defer construction pursuant to 
this section, the Transmission Customer may challenge the decision in 
accordance with the dispute resolution procedures pursuant to Section 
12 or it may refer the dispute to the Commission for resolution.

22 Changes in Service Specifications

22.1  Modifications On a Non-Firm Basis
    The Transmission Customer taking Firm Point-To-Point Transmission 
Service may request the Transmission Provider to provide transmission 
service on a non-firm basis over Receipt and Delivery Points other than 
those specified in the Service Agreement (``Secondary Receipt and 
Delivery Points''), in amounts not to exceed its firm capacity 
reservation, without incurring an additional Non-Firm Point-To-Point 
Transmission Service charge or executing a new Service Agreement, 
subject to the following conditions.
    (a) Service provided over Secondary Receipt and Delivery Points 
will be non-firm only, on an as-available basis and will not displace 
any firm or non-firm service reserved or scheduled by third-parties 
under the Tariff or by the Transmission Provider on behalf of its 
Native Load Customers.
    (b) The sum of all Firm and non-firm Point-To-Point Transmission 
Service provided to the Transmission Customer at any time pursuant to 
this section shall not exceed the Reserved Capacity in the relevant 
Service Agreement under which such services are provided.
    (c) The Transmission Customer shall retain its right to schedule 
Firm Point-To-Point Transmission Service at the Receipt and Delivery 
Points specified in the relevant Service Agreement in the amount of its 
original capacity reservation.
    (d) Service over Secondary Receipt and Delivery Points on a non-
firm basis shall not require the filing of an Application for Non-Firm 
Point-To-Point Transmission Service under the Tariff. However, all 
other requirements of Part II of the Tariff (except as to transmission 
rates) shall apply to transmission service on a non-firm basis over 
Secondary Receipt and Delivery Points.
22.2 Modifications on a Firm Basis
    Any request by a Transmission Customer to modify Receipt and 
Delivery Points on a firm basis shall be treated as a new request for 
service in accordance with Section 17 hereof except that such 
Transmission Customer shall not be obligated to pay any additional 
application processing fee if the capacity reservation does not exceed 
the amount reserved in the existing Service Agreement. While such new 
request is pending, the Transmission Customer shall retain its priority 
for service at the existing firm Receipt and Delivery Points specified 
in its Service Agreement.

23 Sale or Assignment of Transmission Service

23.1 Procedures for Assignment or Transfer of Service
    Subject to Commission approval of any necessary filings, a 
Transmission Customer may sell, assign, or transfer all or a portion of 
its rights under its Service Agreement, but only to another Eligible 
Customer (the Assignee). The Transmission Customer that sells, assigns 
or transfers its rights under its Service Agreement is hereafter 
referred to as the Reseller. Compensation to the Reseller shall not 
exceed the higher of (i) the original rate paid by the Reseller, (ii) 
the Transmission Provider's maximum rate on file at the time of the 
assignment, or (iii) the Reseller's opportunity cost capped at the 
Transmission Provider's cost of expansion. If the Assignee does not

[[Page 545]]

request any change in the Point(s) of Receipt or the Point(s) of 
Delivery, or a change in any other term or condition set forth in the 
original Service Agreement, the Assignee will receive the same services 
as did the Reseller and the priority of service for the Assignee will 
be the same as that of the Reseller. A Reseller should notify the 
Transmission Provider as soon as possible after any assignment or 
transfer of service occurs but in any event, notification must be 
provided prior to any provision of service to the Assignee. The 
Assignee will be subject to all terms and conditions of the Tariff. If 
the Assignee requests a change in service, the reservation priority of 
service will be determined by the Transmission Provider pursuant to 
Section 13.2.
23.2 Limitations on Assignment or Transfer of Service
    If the Assignee requests a change in the Point(s) of Receipt or 
Point(s) of Delivery, or a change in any other specifications set forth 
in the original Service Agreement, the Transmission Provider will 
consent to such change subject to the provisions of the Tariff, 
provided that the change will not impair the operation and reliability 
of the Transmission Provider's generation, transmission, or 
distribution systems. The Assignee shall compensate the Transmission 
Provider in advance for performing any System Impact Study needed to 
evaluate the capability of the Transmission System to accommodate the 
proposed change and any additional costs resulting from such change. 
The Reseller shall remain liable for the performance of all obligations 
under the Service Agreement, except as specifically agreed to by the 
Parties through an amendment to the Service Agreement.
23.3 Information on Assignment or Transfer of Service
    In accordance with Section 4, Resellers may use the Transmission 
Provider's OASIS to post transmission capacity available for resale.

24 Metering and Power Factor Correction at Receipt and Delivery 
Point(s)

24.1 Transmission Customer Obligations

    Unless otherwise agreed, the Transmission Customer shall be 
responsible for installing and maintaining compatible metering and 
communications equipment to accurately account for the capacity and 
energy being transmitted under Part II of the Tariff and to communicate 
the information to the Transmission Provider. Such equipment shall 
remain the property of the Transmission Customer.
24.2 Transmission Provider Access to Metering Data
    The Transmission Provider shall have access to metering data, which 
may reasonably be required to facilitate measurements and billing under 
the Service Agreement.
24.3 Power Factor
    Unless otherwise agreed, the Transmission Customer is required to 
maintain a power factor within the same range as the Transmission 
Provider pursuant to Good Utility Practices. The power factor 
requirements are specified in the Service Agreement where applicable.

25 Compensation for Transmission Service

    Rates for Firm and Non-Firm Point-To-Point Transmission Service are 
provided in the Schedules appended to the Tariff: Firm Point-To-Point 
Transmission Service (Schedule 7); and Non-Firm Point-To-Point 
Transmission Service (Schedule 8). The Transmission Provider shall use 
Part II of the Tariff to make its Third-Party Sales. The Transmission 
Provider shall account for such use at the applicable Tariff rates, 
pursuant to Section 8.

26 Stranded Cost Recovery

    The Transmission Provider may seek to recover stranded costs from 
the Transmission Customer in a manner consistent with applicable 
Federal law and regulations.

27 Compensation for New Facilities and Redispatch Costs

    Whenever a System Impact Study performed by the Transmission 
Provider in connection with the provision of Firm Point-To-Point 
Transmission Service identifies the need for new facilities, the 
Transmission Customer shall be responsible for such costs to the extent 
consistent with Commission policy. Whenever a System Impact Study 
performed by the Transmission Provider identifies capacity constraints 
that may be relieved more economically by redispatching the 
Transmission Provider's resources than by building new facilities or 
upgrading existing facilities to eliminate such constraints, the 
Transmission Customer shall be responsible for the redispatch costs to 
the extent consistent with Commission policy.

Part III. Network Integration Transmission Service

Preamble

    The Transmission Provider will provide Network Integration 
Transmission Service pursuant to the applicable terms and conditions 
contained in the Tariff and Service Agreement. Network Integration 
Transmission Service allows the Network Customer to integrate, 
economically dispatch and regulate its current and planned Network 
Resources to serve its Network Load in a manner comparable to that in 
which the Transmission Provider utilizes its Transmission System to 
serve its Native Load Customers. Network Integration Transmission 
Service also may be used by the Network Customer to deliver economy 
energy purchases to its Network Load from non-designated resources on 
an as-available basis without additional charge. Transmission service 
for sales to non-designated loads will be provided pursuant to the 
applicable terms and conditions of Part II of the Tariff.

28 Nature of Network Integration Transmission Service

28.1 Scope of Service
    Network Integration Transmission Service is a transmission service 
that allows Network Customers to efficiently and economically utilize 
their Network Resources (as well as other non-designated generation 
resources) to serve their Network Load located in the Transmission 
Provider's Control Area and any additional load that may be designated 
pursuant to Section 31.3 of the Tariff. The Network Customer taking 
Network Integration Transmission Service must obtain or provide 
Ancillary Services pursuant to Section 3.
28.2 Transmission Provider Responsibilities
    The Transmission Provider will plan, construct, operate and 
maintain its Transmission System in accordance with Good Utility 
Practice in order to provide the Network Customer with Network 
Integration Transmission Service over the Transmission Provider's 
Transmission System. The Transmission Provider, on behalf of its Native 
Load Customers, shall be required to designate resources and loads in 
the same manner as any Network Customer under Part III of the Tariff. 
This information must be consistent with the information used by the 
Transmission Provider to calculate available transmission capability. 
The

[[Page 546]]

Transmission Provider shall include the Network Customer's Network Load 
in its Transmission System planning and shall, consistent with Good 
Utility Practice, endeavor to construct and place into service 
sufficient transmission capacity to deliver the Network Customer's 
Network Resources to serve its Network Load on a basis comparable to 
the Transmission Provider's delivery of its own generating and 
purchased resources to its Native Load Customers. This obligation to 
construct and place into service sufficient transmission capacity to 
deliver the Network Customer's Network Resources to serve its Network 
Load is contingent upon the availability to Western of sufficient 
appropriations, when needed, and the Transmission Customer's advanced 
funds.
28.3  Network Integration Transmission Service
    The Transmission Provider will provide firm transmission service 
over its Transmission System to the Network Customer for the delivery 
of capacity and energy from its designated Network Resources to service 
its Network Loads on a basis that is comparable to the Transmission 
Provider's use of the Transmission System to reliably serve its Native 
Load Customers.
28.4  Secondary Service
    The Network Customer may use the Transmission Provider's 
Transmission System to deliver energy to its Network Loads from 
resources that have not been designated as Network Resources. Such 
energy shall be transmitted, on an as-available basis, at no additional 
charge. Deliveries from resources other than Network Resources will 
have a higher priority than any Non-Firm Point-To-Point Transmission 
Service under Part II of the Tariff.
28.5  Real Power Losses
    Real Power Losses are associated with all transmission service. The 
Transmission Provider is not obligated to provide Real Power Losses. 
The Network Customer is responsible for replacing losses associated 
with all transmission service as calculated by the Transmission 
Provider. The applicable Real Power Loss factors are specified in the 
Service Agreements.
28.6  Restrictions on Use of Service
    The Network Customer shall not use Network Integration Transmission 
Service for (i) sales of capacity and energy to non-designated loads, 
or (ii) direct or indirect provision of transmission service by the 
Network Customer to third parties. All Network Customers taking Network 
Integration Transmission Service shall use Point-To-Point Transmission 
Service under Part II of the Tariff for any Third-Party Sale which 
requires use of the Transmission Provider's Transmission System.

29  Initiating Service

29.1  Condition Precedent for Receiving Service
    Subject to the terms and conditions of Part III of the Tariff, the 
Transmission Provider will provide Network Integration Transmission 
Service to any Eligible Customer provided that (i) the Eligible 
Customer completes an Application for service as provided under Part 
III of the Tariff, (ii) the Eligible Customer and the Transmission 
Provider complete the technical arrangements set forth in Sections 29.3 
and 29.4, (iii) the Eligible Customer executes a Service Agreement 
pursuant to Attachment F for service under Part III of the Tariff or 
requests in writing that the Transmission Provider provide service 
without an executed Service Agreement, and (iv) the Eligible Customer 
executes a Network Operating Agreement with the Transmission Provider 
pursuant to Attachment G, or requests in writing that the Transmission 
Provider provide service without an executed Network Operating 
Agreement. If the Transmission Provider and the Network Customer cannot 
agree on all the terms and conditions of the Network Service Agreement, 
the Transmission Provider shall commence providing Network Integration 
Transmission Service subject to the Network Customer agreeing to (i) 
compensate the Transmission Provider at the existing rate placed in 
effect pursuant to applicable Federal law and regulations, and (ii) 
comply with the terms and conditions of the Tariff including paying the 
appropriate processing fees in accordance with the terms of Section 
29.2. If the Network Customer cannot accept all of the terms and 
conditions of the offered Service Agreement, the Network Customer may 
request resolution of the unacceptable terms and conditions under 
Section 12, Dispute Resolution Procedures, of the Tariff. Any changes 
resulting from the Dispute Resolution Procedures will be effective upon 
the date of initial service.
29.2  Application Procedures
    An Eligible Customer requesting service under Part III of the 
Tariff must submit an Application to the Transmission Provider as far 
as possible in advance of the month in which service is to commence. 
Unless subject to the procedures in Section 2, Completed Applications 
for Network Integration Transmission Service will be assigned a 
priority according to the date and time the Application is received, 
with the earliest Application receiving the highest priority. 
Applications should be submitted by entering the information listed 
below on the Transmission Provider's OASIS. Prior to implementation of 
the Transmission Provider's OASIS, a Completed Application may be 
submitted by (i) transmitting the required information to the 
Transmission Provider by telefax, or (ii) providing the information by 
telephone over the Transmission Provider's time recorded telephone 
line. Each of these methods will provide a time-stamped record for 
establishing the service priority of the Application. A Completed 
Application for Network Integration Transmission Service also shall 
include a non-refundable processing fee. Such fee shall be applicable 
to all Transmission Customers for firm Transmission Service requests of 
one year or longer. Individual Transmission Provider processing fees 
will be calculated using the number of estimated hours it will take to 
process an application and will be set forth in Attachment K. This fee 
does not apply to costs to complete System Impact Studies or Facility 
Studies or to add new facilities. A Completed Application shall provide 
all of the information included in 18 CFR 2.20 including but not 
limited to the following:
    (i) The identity, address, telephone number and facsimile number of 
the party requesting service;
    (ii) A statement that the party requesting service is, or will be 
upon commencement of service, an Eligible Customer under the Tariff;
    (iii) A description of the Network Load at each delivery point. 
This description should separately identify and provide the Eligible 
Customer's best estimate of the total loads to be served at each 
transmission voltage level, and the loads to be served from each 
Transmission Provider substation at the same transmission voltage 
level. The description should include a ten (10) year forecast of 
summer and winter load and resource requirements beginning with the 
first year after the service is scheduled to commence;
    (iv) The amount and location of any interruptible loads included in 
the Network Load. This shall include the summer and winter capacity 
requirements for each interruptible load (had such load not been 
interruptible), that portion of the load subject to interruption, the 
conditions under

[[Page 547]]

which an interruption can be implemented and any limitations on the 
amount and frequency of interruptions. An Eligible Customer should 
identify the amount of interruptible customer load (if any), included 
in the 10 year load forecast provided in response to (iii) above;
    (v) A description of Network Resources (current and 10-year 
projection), which shall include, for each Network Resource:

--Unit size and amount of capacity from that unit to be designated as 
Network Resource
--VAR capability (both leading and lagging), of all generators
--Operating restrictions
    --Any periods of restricted operations throughout the year
    --Maintenance schedules
    --Minimum loading level of unit
    --Normal operating level of unit
    --Any must-run unit designations required for system reliability or 
contract reasons
--Approximate variable generating cost ($/MWH) for redispatch 
computations
--Arrangements governing sale and delivery of power to third parties 
from generating facilities located in the Transmission Provider Control 
Area, where only a portion of unit output is designated as a Network 
Resource
--Description of purchased power designated as a Network Resource 
including source of supply, Control Area location, transmission 
arrangements and delivery point(s) to the Transmission Provider's 
Transmission System;

    (vi) Description of Eligible Customer's transmission system:

--Load flow and stability data, such as real and reactive parts of the 
load, lines, transformers, reactive devices and load type, including 
normal and emergency ratings of all transmission equipment in a load 
flow format compatible with that used by the Transmission Provider
--Operating restrictions needed for reliability
--Operating guides employed by system operators
--Contractual restrictions or committed uses of the Eligible Customer's 
transmission system, other than the Eligible Customer's Network Loads 
and Resources
--Location of Network Resources described in subsection (v) above
--10 year projection of system expansions or upgrades
--Transmission System maps that include any proposed expansions or 
upgrades
--Thermal ratings of Eligible Customer's Control Area ties with other 
Control Areas;

    (vii) Service Commencement Date and the term of the requested 
Network Integration Transmission Service. The minimum term for Network 
Integration Transmission Service is one year.
    Unless the Parties agree to a different time frame, the 
Transmission Provider must acknowledge the request within ten (10) days 
of receipt. The acknowledgment must include a date by which a response, 
including a Service Agreement, will be sent to the Eligible Customer. 
If an Application fails to meet the requirements of this section, the 
Transmission Provider shall notify the Eligible Customer requesting 
service within fifteen (15) days of receipt and specify the reasons for 
such failure. Wherever possible, the Transmission Provider will attempt 
to remedy deficiencies in the Application through informal 
communications with the Eligible Customer. If such efforts are 
unsuccessful, the Transmission Provider shall return the Application 
without prejudice to the Eligible Customer filing a new or revised 
Application that fully complies with the requirements of this section. 
The Eligible Customer will be assigned a new priority consistent with 
the date of the new or revised Application. The Transmission Provider 
shall treat this information consistent with the standards of conduct 
contained in Part 37 of the Commission's regulations.
29.3  Technical Arrangements to be Completed Prior to Commencement of 
Service
    Network Integration Transmission Service shall not commence until 
the Transmission Provider and the Network Customer or a third party, 
have completed installation of all equipment specified under the 
Network Operating Agreement consistent with Good Utility Practice and 
any additional requirements reasonably and consistently imposed to 
ensure the reliable operation of the Transmission System. The 
Transmission Provider shall exercise reasonable efforts, in 
coordination with the Network Customer to complete such arrangements as 
soon as practicable taking into consideration the Service Commencement 
Date.
29.4  Network Customer Facilities
    The provision of Network Integration Transmission Service shall be 
conditioned upon the Network Customer constructing, maintaining and 
operating the facilities on its side of each delivery point or 
interconnection necessary to reliably deliver capacity and energy from 
the Transmission Provider's Transmission System to the Network 
Customer. The Network Customer shall be solely responsible for 
constructing or installing all facilities on the Network Customer's 
side of each such delivery point or interconnection.
    29.5  This section is intentionally left blank.

30  Network Resources

30.1  Designation of Network Resources
    Network Resources shall include all generation owned, purchased, or 
leased by the Network Customer designated to serve Network Load under 
the Tariff. Network Resources may not include resources, or any portion 
thereof, that are committed for sale to non-designated third party load 
or otherwise cannot be called upon to meet the Network Customer's 
Network Load on a non-interruptible basis. Any owned or purchased 
resources that were serving the Network Customer's loads under firm 
agreements entered into on or before the Service Commencement Date 
shall initially be designated as Network Resources until the Network 
Customer terminates the designation of such resources.
30.2  Designation of New Network Resources
    The Network Customer may designate a new Network Resource by 
providing the Transmission Provider with as much advance notice as 
practicable. A designation of a new Network Resource must be made by a 
request for modification of service pursuant to an Application under 
Section 29.
30.3  Termination of Network Resources
    The Network Customer may terminate the designation of all or part 
of a generating resource as a Network Resource at any time but should 
provide notification to the Transmission Provider as soon as reasonably 
practicable.
30.4  Operation of Network Resources
    The Network Customer shall not operate its designated Network 
Resources located in the Network Customer's or Transmission Provider's 
Control Area such that the output of those facilities exceeds its 
designated Network Load, plus non-firm sales delivered pursuant to Part 
II of the Tariff, plus losses. This limitation shall not apply to 
changes in the operation of a Transmission Customer's Network Resources 
at the request of the Transmission Provider to respond to an emergency 
or other unforeseen

[[Page 548]]

condition which may impair or degrade the reliability of the 
Transmission System.
30.5  Network Customer Redispatch Obligation
    As a condition to receiving Network Integration Transmission 
Service, the Network Customer agrees to redispatch its Network 
Resources as requested by the Transmission Provider pursuant to Section 
33.2. To the extent practical, the redispatch of resources pursuant to 
this section shall be on a least cost, non-discriminatory basis between 
all Network Customers, and the Transmission Provider.
30.6  Transmission Arrangements for Network Resources Not Physically 
Interconnected With The Transmission Provider
    The Network Customer shall be responsible for any arrangements 
necessary to deliver capacity and energy from a Network Resource not 
physically interconnected with the Transmission Provider's Transmission 
System. The Transmission Provider will undertake reasonable efforts to 
assist the Network Customer in obtaining such arrangements, including 
without limitation, providing any information or data required by such 
other entity pursuant to Good Utility Practice.
30.7  Limitation on Designation of Network Resources
    The Network Customer must demonstrate that it owns or has committed 
to purchase generation pursuant to an executed contract in order to 
designate a generating resource as a Network Resource. Alternatively, 
the Network Customer may establish that execution of a contract is 
contingent upon the availability of transmission service under Part III 
of the Tariff.
30.8  Use of Interface Capacity by the Network Customer
    There is no limitation upon a Network Customer's use of the 
Transmission Provider's Transmission System at any particular interface 
to integrate the Network Customer's Network Resources (or substitute 
economy purchases) with its Network Loads. However, a Network 
Customer's use of the Transmission Provider's total interface capacity 
with other transmission systems may not exceed the Network Customer's 
Load.
30.9  Network Customer Owned Transmission Facilities
    The Network Customer that owns existing transmission facilities 
that are integrated with the Transmission Provider's Transmission 
System may be eligible to receive consideration either through a 
billing credit or some other mechanism. In order to receive such 
consideration the Network Customer must demonstrate that its 
transmission facilities are integrated into the plans or operations of 
the Transmission Provider to serve its power and transmission 
customers. For facilities constructed by the Network Customer 
subsequent to the Service Commencement Date under Part III of the 
Tariff, the Network Customer shall receive credit where such facilities 
are jointly planned and installed in coordination with the Transmission 
Provider. Calculation of the credit shall be addressed in either the 
Network Customer's Service Agreement or any other agreement between the 
Parties.

31  Designation of Network Load

31.1  Network Load
    The Network Customer must designate the individual Network Loads on 
whose behalf the Transmission Provider will provide Network Integration 
Transmission Service. The Network Loads shall be specified in the 
Service Agreement.
31.2  New Network Loads Connected With the Transmission Provider
    The Network Customer shall provide the Transmission Provider with 
as much advance notice as reasonably practicable of the designation of 
new Network Load that will be added to its Transmission System. A 
designation of new Network Load must be made through a modification of 
service pursuant to a new Application. The Transmission Provider will 
use due diligence to install any transmission facilities required to 
interconnect a new Network Load designated by the Network Customer. The 
costs of new facilities required to interconnect a new Network Load 
shall be determined in accordance with the procedures provided in 
Section 32.4 and shall be charged to the Network Customer in accordance 
with Commission policies.
31.3  Network Load Not Physically Interconnected with the Transmission 
Provider
    This section applies to both initial designation pursuant to 
Section 31.1 and the subsequent addition of new Network Load not 
physically interconnected with the Transmission Provider. To the extent 
that the Network Customer desires to obtain transmission service for a 
load outside the Transmission Provider's Transmission System, the 
Network Customer shall have the option of (1) electing to include the 
entire load as Network Load for all purposes under Part III of the 
Tariff and designating Network Resources in connection with such 
additional Network Load, or (2) excluding that entire load from its 
Network Load and purchasing Point-To-Point Transmission Service under 
Part II of the Tariff. To the extent that the Network Customer gives 
notice of its intent to add a new Network Load as part of its Network 
Load pursuant to this section the request must be made through a 
modification of service pursuant to a new Application.
31.4  New Interconnection Points
    To the extent the Network Customer desires to add a new Delivery 
Point or interconnection point between the Transmission Provider's 
Transmission System and a Network Load, the Network Customer shall 
provide the Transmission Provider with as much advance notice as 
reasonably practicable.
31.5  Changes in Service Requests
    Under no circumstances shall the Network Customer's decision to 
cancel or delay a requested change in Network Integration Transmission 
Service (e.g. the addition of a new Network Resource or designation of 
a new Network Load) in any way relieve the Network Customer of its 
obligation to pay the costs of transmission facilities constructed by 
the Transmission Provider and charged to the Network Customer as 
reflected in the Service Agreement. However, the Transmission Provider 
must treat any requested change in Network Integration Transmission 
Service in a non-discriminatory manner. The Transmission Provider will 
have no obligation to refund any advance of funds expended for purposes 
of providing facilities for a Network Customer. However, upon receipt 
of a Network Customer's written notice of such a cancellation or delay, 
the Transmission Provider will use the same reasonable efforts to 
mitigate the costs and charges owed to the Transmission Provider as it 
would to reduce its own costs and charges.
31.6  Annual Load and Resource Information Updates
    The Network Customer shall provide the Transmission Provider with 
annual updates of Network Load and Network Resource forecasts 
consistent with those included in its Application for Network 
Integration Transmission Service under Part III of the Tariff. The 
Network Customer also shall provide the Transmission Provider with 
timely

[[Page 549]]

written notice of material changes in any other information provided in 
its Application relating to the Network Customer's Network Load, 
Network Resources, its transmission system or other aspects of its 
facilities or operations affecting the Transmission Provider's ability 
to provide reliable service.

32  Additional Study Procedures for Network Integration Transmission 
Service Requests

32.1  Notice of Need for System Impact Study
    After receiving a request for service, the Transmission Provider 
shall determine on a non-discriminatory basis whether a System Impact 
Study is needed. A description of the Transmission Provider's 
methodology for completing a System Impact Study is provided in 
Attachment D. If the Transmission Provider determines that a System 
Impact Study is necessary to accommodate the requested service, it 
shall so inform the Eligible Customer, as soon as practicable. In such 
cases, the Transmission Provider shall within thirty (30) days of 
receipt of a Completed Application, tender a System Impact Study 
Agreement pursuant to which the Eligible Customer shall agree to 
advance funds to the Transmission Provider for performing the required 
System Impact Study. For a service request to remain a Completed 
Application, the Eligible Customer shall execute the System Impact 
Study Agreement and return it to the Transmission Provider within 
fifteen (15) days. If the Eligible Customer elects not to execute the 
System Impact Study Agreement, its Application shall be deemed 
withdrawn.
32.2  System Impact Study Agreement and Compensation
    (i) The System Impact Study Agreement will clearly specify the 
Transmission Provider's estimate of the actual cost, and time for 
completion of the System Impact Study. The charge shall not exceed the 
actual cost of the study. In performing the System Impact Study, the 
Transmission Provider shall rely, to the extent reasonably practicable, 
on existing transmission planning studies. The Eligible Customer will 
not be assessed a charge for such existing studies; however, the 
Eligible Customer will be responsible for charges associated with any 
modifications to existing planning studies that are reasonably 
necessary to evaluate the impact of the Eligible Customer's request for 
service on the Transmission System.
    (ii) If in response to multiple Eligible Customers requesting 
service in relation to the same competitive solicitation, a single 
System Impact Study is sufficient for the Transmission Provider to 
accommodate the service requests, the costs of that study shall be pro-
rated among the Eligible Customers.
    (iii) For System Impact Studies that the Transmission Provider 
conducts on its own behalf, the Transmission Provider shall record the 
cost of the System Impact Studies pursuant to Section 8.
32.3  System Impact Study Procedures
    Upon receipt of an executed System Impact Study Agreement, the 
Transmission Provider will use due diligence to complete the required 
System Impact Study within a sixty (60) day period. The System Impact 
Study shall identify any system constraints and redispatch options, 
additional Direct Assignment Facilities or Network Upgrades required to 
provide the requested service. In the event that the Transmission 
Provider is unable to complete the required System Impact Study within 
such time period, it shall so notify the Eligible Customer and provide 
an estimated completion date along with an explanation of the reasons 
why additional time is required to complete the required studies. A 
copy of the completed System Impact Study and related work papers shall 
be made available to the Eligible Customer. The Transmission Provider 
will use the same due diligence in completing the System Impact Study 
for an Eligible Customer as it uses when completing studies for itself. 
The Transmission Provider shall notify the Eligible Customer 
immediately upon completion of the System Impact Study if the 
Transmission System will be adequate to accommodate all or part of a 
request for service or that no costs are likely to be incurred for new 
transmission facilities or upgrades. In order for a request to remain a 
Completed Application, within fifteen (15) days of completion of the 
System Impact Study the Eligible Customer must execute a Service 
Agreement or request service without an executed Service Agreement 
pursuant to Section 29.1, or the Application shall be deemed terminated 
and withdrawn.
32.4  Facilities Study Procedures
    If a System Impact Study indicates that additions or upgrades to 
the Transmission System are needed to supply the Eligible Customer's 
service request, the Transmission Provider, within thirty (30) days of 
the completion of the System Impact Study, shall tender to the Eligible 
Customer a Facilities Study Agreement pursuant to which the Eligible 
Customer shall agree to advance funds to the Transmission Provider for 
performing the required Facilities Study. For a service request to 
remain a Completed Application, the Eligible Customer shall execute the 
Facilities Study Agreement and return it to the Transmission Provider 
within fifteen (15) days. If the Eligible Customer elects not to 
execute the Facilities Study Agreement, its Application shall be deemed 
withdrawn. Upon receipt of an executed Facilities Study Agreement, the 
Transmission Provider will use due diligence to complete the required 
Facilities Study within a sixty (60) day period. If the Transmission 
Provider is unable to complete the Facilities Study in the allotted 
time period, the Transmission Provider shall notify the Eligible 
Customer and provide an estimate of the time needed to reach a final 
determination along with an explanation of the reasons that additional 
time is required to complete the study. When completed, the Facilities 
Study will include a good faith estimate of (i) the cost of Direct 
Assignment Facilities to be charged to the Eligible Customer, (ii) the 
Eligible Customer's appropriate share of the cost of any required 
Network Upgrades, and (iii) the time required to complete such 
construction and initiate the requested service. The Eligible Customer 
shall advance funds to the Transmission Provider for the construction 
of new facilities and such advance and construction shall be provided 
for in a separate agreement. If the construction of new facilities 
requires the expenditure of Transmission Provider funds, such 
construction shall be contingent upon the availability of appropriated 
funds. The Eligible Customer shall have thirty (30) days to execute a 
construction agreement and a Service Agreement and provide the advance 
payment or request service without an executed Service Agreement 
pursuant to Section 29.1 and pay the Transmission Customer's share of 
the costs or the request no longer will be a Completed Application and 
shall be deemed terminated and withdrawn. Any advance payment made by 
the Transmission Customer that is in excess of the costs incurred by 
the Transmission Provider shall be refunded.

33  Load Shedding and Curtailments

33.1  Procedures
    Prior to the Service Commencement Date, the Transmission Provider 
and the

[[Page 550]]

Network Customer shall establish Load Shedding and Curtailment 
procedures pursuant to the Network Operating Agreement with the 
objective of responding to contingencies on the Transmission System. 
The Parties will implement such programs during any period when the 
Transmission Provider determines that a system contingency exists and 
such procedures are necessary to alleviate such contingency. The 
Transmission Provider will notify all affected Network Customers in a 
timely manner of any scheduled Curtailment.
33.2  Transmission Constraints
    During any period when the Transmission Provider determines that a 
transmission constraint exists on the Transmission System, and such 
constraint may impair the reliability of the Transmission Provider's 
system, the Transmission Provider will take whatever actions, 
consistent with Good Utility Practice, that are reasonably necessary to 
maintain the reliability of the Transmission Provider's system. To the 
extent the Transmission Provider determines that the reliability of the 
Transmission System can be maintained by redispatching resources, the 
Transmission Provider will initiate procedures pursuant to the Network 
Operating Agreement to redispatch all Network Resources and the 
Transmission Provider's own resources on a least-cost basis without 
regard to the ownership of such resources. Any redispatch under this 
section may not unduly discriminate between the Transmission Provider's 
use of the Transmission System on behalf of its Native Load Customers 
and any Network Customer's use of the Transmission System to serve its 
designated Network Load.
33.3  Cost Responsibility for Relieving Transmission Constraints
    Whenever the Transmission Provider implements least-cost redispatch 
procedures in response to a transmission constraint, the Transmission 
Provider and Network Customers will each bear a proportionate share of 
the total redispatch cost based on their respective Load Ratio Shares.
33.4  Curtailments of Scheduled Deliveries
    If a transmission constraint on the Transmission Provider's 
Transmission System cannot be relieved through the implementation of 
least-cost redispatch procedures and the Transmission Provider 
determines that it is necessary to Curtail scheduled deliveries, the 
Parties shall Curtail such schedules in accordance with the Network 
Operating Agreement.
33.5  Allocation of Curtailments
    The Transmission Provider shall, on a non-discriminatory basis, 
Curtail the transaction(s) that effectively relieve the constraint. 
However, to the extent practicable and consistent with Good Utility 
Practice, any Curtailment will be shared by the Transmission Provider 
and Network Customer in proportion to their respective Load Ratio 
Shares. The Transmission Provider shall not direct the Network Customer 
to Curtail schedules to an extent greater than the Transmission 
Provider would Curtail the Transmission Provider's schedules under 
similar circumstances.
33.6  Load Shedding
    To the extent that a system contingency exists on the Transmission 
Provider's Transmission System and the Transmission Provider determines 
that it is necessary for the Transmission Provider and the Network 
Customer to shed load, the Parties shall shed load in accordance with 
previously established procedures under the Network Operating 
Agreement.
33.7  System Reliability
    Notwithstanding any other provisions of this Tariff, the 
Transmission Provider reserves the right, consistent with Good Utility 
Practice and on a not unduly discriminatory basis, to Curtail Network 
Integration Transmission Service without liability on the Transmission 
Provider's part for the purpose of making necessary adjustments to, 
changes in, or repairs on its lines, substations and facilities, and in 
cases where the continuance of Network Integration Transmission Service 
would endanger persons or property. In the event of any adverse 
condition(s) or disturbance(s) on the Transmission Provider's 
Transmission System or on any other system(s) directly or indirectly 
interconnected with the Transmission Provider's Transmission System, 
the Transmission Provider, consistent with Good Utility Practice, also 
may Curtail Network Integration Transmission Service in order to (i) 
limit the extent or damage of the adverse condition(s) or 
disturbance(s), (ii) prevent damage to generating or transmission 
facilities, or (iii) expedite restoration of service. The Transmission 
Provider will give the Network Customer as much advance notice as is 
practicable in the event of such Curtailment. Any Curtailment of 
Network Integration Transmission Service will be not unduly 
discriminatory relative to the Transmission Provider's use of the 
Transmission System on behalf of its Native Load Customers. The 
Transmission Provider shall specify the rate treatment and all related 
terms and conditions applicable in the event that the Network Customer 
fails to respond to established Load Shedding and Curtailment 
procedures.

34  Rates and Charges

    The Network Customer shall pay the Transmission Provider for any 
Direct Assignment Facilities, Ancillary Services, and applicable study 
costs, consistent with Federal policy, along with the following:
34.1  Monthly Demand Charge
    The Network Customer shall pay a monthly Demand Charge, which shall 
be determined by multiplying its Load Ratio Share times one twelfth 
(\1/12\) of the Transmission Provider's Annual Transmission Revenue 
Requirement specified in Schedule H.
34.2  Determination of Network Customer's Monthly Network Load
    The Network Customer's monthly Network Load is its hourly load 
(including its designated Network Load not physically interconnected 
with the Transmission Provider under Section 31.3) coincident with the 
Transmission Provider's Monthly Transmission System Peak.
34.3  Determination of Transmission Provider's Monthly Transmission 
System Load
    The Transmission Provider's monthly Transmission System load is the 
Transmission Provider's Monthly Transmission System Peak minus the 
coincident peak usage of all Firm Point-To-Point Transmission Service 
customers pursuant to Part II of this Tariff plus the Reserved Capacity 
of all Firm Point-To-Point Transmission Service customers.
34.4  Redispatch Charge
    The Network Customer shall pay a Load Ratio Share of any redispatch 
costs allocated between the Network Customer and the Transmission 
Provider pursuant to Section 33. To the extent that the Transmission 
Provider incurs an obligation to the Network Customer for redispatch 
costs in accordance with Section 33, such amounts shall be credited 
against the Network Customer's bill for the applicable month.

[[Page 551]]

34.5  Stranded Cost Recovery
    The Transmission Provider may seek to recover stranded costs from 
the Network Customer in a manner consistent with applicable Federal law 
and regulations.

35  Operating Arrangements

35.1  Operation under The Network Operating Agreement
    The Network Customer shall plan, construct, operate and maintain 
its facilities in accordance with Good Utility Practice and in 
conformance with the Network Operating Agreement.
35.2  Network Operating Agreement
    The terms and conditions under which the Network Customer shall 
operate its facilities and the technical and operational matters 
associated with the implementation of Part III of the Tariff shall be 
specified in the Network Operating Agreement. The Network Operating 
Agreement shall provide for the Parties to (i) operate and maintain 
equipment necessary for integrating the Network Customer within the 
Transmission Provider's Transmission System (including, but not limited 
to, remote terminal units, metering, communications equipment and 
relaying equipment), (ii) transfer data between the Transmission 
Provider and the Network Customer (including, but not limited to, heat 
rates and operational characteristics of Network Resources, generation 
schedules for units outside the Transmission Provider's Transmission 
System, interchange schedules, unit outputs for redispatch required 
under Section 33, voltage schedules, loss factors and other real time 
data), (iii) use software programs required for data links and 
constraint dispatching, (iv) exchange data on forecasted loads and 
resources necessary for long-term planning, and (v) address any other 
technical and operational considerations required for implementation of 
Part III of the Tariff, including scheduling protocols. The Network 
Operating Agreement will recognize that the Network Customer shall 
either (i) operate as a Control Area under applicable guidelines of the 
North American Electric Reliability Council (NERC) and the applicable 
regional reliability council, (ii) satisfy its Control Area 
requirements, including all necessary Ancillary Services, by 
contracting with the Transmission Provider, or (iii) satisfy its 
Control Area requirements, including all necessary Ancillary Services, 
by contracting with another entity, consistent with Good Utility 
Practice, which satisfies NERC and the applicable regional reliability 
council requirements. The Transmission Provider shall not unreasonably 
refuse to accept contractual arrangements with another entity for 
Ancillary Services. The Network Operating Agreement is included in 
Attachment G.
35.3  Network Operating Committee
    A Network Operating Committee (Committee) shall be established to 
coordinate operating criteria for the Parties' respective 
responsibilities under the Network Operating Agreement. Each Network 
Customer shall be entitled to have at least one representative on the 
Committee. The Committee shall meet from time to time as need requires, 
but no less than once each calendar year.

Schedule 1

Scheduling, System Control and Dispatch Service

    This service is required to schedule the movement of power through, 
out of, within, or into a Control Area. This service can be provided 
only by the operator of the Control Area in which the transmission 
facilities used for transmission service are located. Scheduling, 
System Control and Dispatch Service is provided directly by the 
Transmission Provider if the Transmission Provider is the Control Area 
Operator or indirectly by the Transmission Provider making arrangements 
with the Control Area operator that performs this service for the 
Transmission Provider's Transmission System. The Transmission Customer 
must purchase this service from the Transmission Provider or the 
Control Area operator. The charges for Scheduling, System Control and 
Dispatch Service are to be based on the rates referred to below. To the 
extent the Control Area operator performs this service for the 
Transmission Provider, charges to the Transmission Customer are to 
reflect only a pass-through of the costs charged to the Transmission 
Provider by that Control Area operator.
    The Transmission System specific charges for Scheduling, System 
Control and Dispatch Service are set forth in the appropriate rate 
schedule attached to and made part of the applicable Service Agreement. 
The rates or rate methodology used to calculate the charges for service 
under this schedule were promulgated and may be modified pursuant to 
applicable Federal laws, regulations and policies.
    The Transmission Provider may modify the charges for Scheduling, 
System Control and Dispatch Service upon written notice to the 
Transmission Customer. Any change to the charges to the Transmission 
Customer for Scheduling, System Control and Dispatch Service shall be 
as set forth in a subsequent rate schedule promulgated pursuant to 
applicable Federal laws, regulations and policies and attached to and 
made part of the applicable Service Agreement. The Transmission 
Provider shall charge the Transmission Customer in accordance with the 
rate then in effect.

Schedule 2

Reactive Supply and Voltage Control From Generation Sources Service

    In order to maintain transmission voltages on the Transmission 
Provider's transmission facilities within acceptable limits, generation 
facilities under the control of the Control Area operator are operated 
to produce or absorb reactive power. Thus, Reactive Supply and Voltage 
Control from Generation Sources Service must be provided for each 
transaction on the Transmission Provider's transmission facilities. The 
amount of Reactive Supply and Voltage Control from Generation Sources 
Service that must be supplied with respect to the Transmission 
Customer's transaction will be determined based on the reactive power 
support necessary to maintain transmission voltages within limits that 
are generally accepted in the region and consistently adhered to by the 
Transmission Provider.
    Reactive Supply and Voltage Control from Generation Sources Service 
can be provided directly by the Transmission Provider if the 
Transmission Provider is the Control Area operator or indirectly by the 
Transmission Provider making arrangements with the Control Area 
operator that performs this service for the Transmission Provider's 
Transmission System. The Transmission Customer must purchase this 
service from the Transmission Provider or the Control Area operator. 
The charges for such service will be based upon the rates referred to 
below. To the extent the Control Area operator performs this service 
for the Transmission Provider, charges to the Transmission Customer are 
to reflect only a pass-through of the costs charged to the Transmission 
Provider by the Control Area Operator.
    The Transmission System specific charges for Reactive Supply and 
Voltage Control from Generation Sources Service are set forth in the 
appropriate rate schedule attached to and made part of the applicable 
Service Agreement. The rates or rate methodology used to calculate the 
charges for service under this schedule were promulgated and may be 
modified pursuant to applicable Federal laws, regulations and policies.

[[Page 552]]

    The Transmission Provider may modify the charges for Reactive 
Supply and Voltage Control from Generation Sources Service upon written 
notice to the Transmission Customer. Any change to the charges to the 
Transmission Customer for Reactive Supply and Voltage Control from 
Generation Sources Service shall be as set forth in a subsequent rate 
schedule promulgated pursuant to applicable Federal laws, regulations 
and policies and attached to and made part of the applicable Service 
Agreement. The Transmission Provider shall charge the Transmission 
Customer in accordance with the rate then in effect.

Schedule 3

Regulation and Frequency Response Service

    Regulation and Frequency Response Service is necessary to provide 
for the continuous balancing of resources, generation and interchange, 
with load and for maintaining scheduled interconnection frequency at 
sixty cycles per second (60 Hz). Regulation and Frequency Response 
Service is accomplished by committing on-line generation whose output 
is raised or lowered, predominantly through the use of automatic 
generating control equipment, as necessary to follow the moment-by-
moment changes in load. The obligation to maintain this balance between 
resources and load lies with the Transmission Provider (or the Control 
Area operator that performs this function for the Transmission 
Provider). The Transmission Provider must offer this service when the 
transmission service is used to serve load within its Control Area. The 
Transmission Customer must either purchase this service from the 
Transmission Provider or make alternative comparable arrangements to 
satisfy its Regulation and Frequency Response Service obligation. The 
charges for Regulation and Frequency Response Service are referred to 
below. The amount of Regulation and Frequency Response Service will be 
set forth in the Service Agreement. To the extent the Control Area 
operator performs this service for the Transmission Provider, charges 
to the Transmission Customer are to reflect only a pass-through of the 
costs charged to the Transmission Provider by that Control Area 
operator.
    The Transmission System specific charges for Regulation and 
Frequency Response Service are set forth in the appropriate rate 
schedule attached to and made part of the applicable Service Agreement. 
The rates or rate methodology used to calculate the charges for service 
under this schedule were promulgated and may be modified pursuant to 
applicable Federal laws, regulations and policies.
    The Transmission Provider may modify the charges for Regulation and 
Frequency Response Service upon written notice to the Transmission 
Customer. Any change to the charges to the Transmission Customer for 
Regulation and Frequency Response Service shall be as set forth in a 
subsequent rate schedule promulgated pursuant to applicable Federal 
laws, regulations and policies and attached to and made part of the 
applicable Service Agreement. The Transmission Provider shall charge 
the Transmission Customer in accordance with the rate then in effect.

Schedule 4

Energy Imbalance Service

    Energy Imbalance Service is provided when a difference occurs 
between the scheduled and the actual delivery of energy to a load 
located within a Control Area over a single hour. The Transmission 
Provider must offer this service when the transmission service is used 
to serve load within its Control Area. The Transmission Customer must 
either obtain this service from the Transmission Provider or make 
alternative comparable arrangements to satisfy its Energy Imbalance 
Service obligation. To the extent the Control Area operator performs 
this service for the Transmission Provider, charges to the Transmission 
Customer are to reflect only a pass-through of the costs charged to the 
Transmission Provider by that Control Area operator.
    The Transmission Provider shall establish a deviation band of +/
-1.5 percent (with a minimum of 2 MW) of the scheduled transaction to 
be applied hourly to any energy imbalance that occurs as a result of 
the Transmission Customer's scheduled transaction(s). Parties should 
attempt to eliminate energy imbalances within the limits of the 
deviation band within thirty (30) days or within such other reasonable 
period of time as is generally accepted in the region and consistently 
adhered to by the Transmission Provider. If an energy imbalance is not 
corrected within thirty (30) days or a reasonable period of time that 
is generally accepted in the region and consistently adhered to by the 
Transmission Provider, the Transmission Customer will compensate the 
Transmission Provider for such service. Energy imbalances outside the 
deviation band will be subject to charges to be specified by the 
Transmission Provider. Compensation for Energy Imbalance Service will 
be as set forth below.
    The Transmission System specific compensation for Energy Imbalance 
Service is set forth in the appropriate rate schedule attached to and 
made part of the applicable Service Agreement. The rates or rate 
methodology used to calculate the charges for service under this 
schedule were promulgated and may be modified pursuant to applicable 
Federal laws, regulations and policies.
    The Transmission Provider may modify the compensation for Energy 
Imbalance Service upon written notice to the Transmission Customer. Any 
change to the compensation to the Transmission Customer for Energy 
Imbalance Service shall be as set forth in a subsequent rate schedule 
promulgated pursuant to applicable Federal laws, regulations and 
policies and attached to and made part of the applicable Service 
Agreement. The Transmission Provider shall charge the Transmission 
Customer in accordance with the rate then in effect.

Schedule 5

Opeating Reserve--Spinning Reserve Service

    Spinning Reserve Service is needed to serve load immediately in the 
event of a system contingency. Spinning Reserve Service may be provided 
by generating units that are on-line and loaded at less than maximum 
output. The Transmission Provider must offer this service when the 
transmission service is used to serve load within its Control Area. The 
Transmission Customer must either purchase this service from the 
Transmission Provider or make alternative comparable arrangements to 
satisfy its Spinning Reserve Service obligation. The charges for 
Spinning Reserve Service are referred to below. The amount of Spinning 
Reserve Service will be set forth in the Service Agreement. To the 
extent the Control Area operator performs this service for the 
Transmission Provider, charges to the Transmission Customer are to 
reflect only a pass-through of the costs charged to the Transmission 
Provider by that Control Area operator.
    The Transmission System specific charges for Operating Reserve--
Spinning Reserve Service are set forth in the appropriate rate schedule 
attached to and made part of the applicable Service Agreement. The 
rates or rate methodology used to calculate the charges for service 
under this schedule were promulgated and may be modified pursuant to 
applicable Federal laws, regulations and policies.

[[Page 553]]

    The Transmission Provider may modify the charges for Operating 
Reserve--Spinning Reserve Service upon written notice to the 
Transmission Customer. Any change to the charges to the Transmission 
Customer for Operating Reserve--Spinning Reserve Service shall be as 
set forth in a subsequent rate schedule promulgated pursuant to 
applicable Federal laws, regulations and policies and attached to and 
made part of the applicable Service Agreement. The Transmission 
Provider shall charge the Transmission Customer in accordance with the 
rate then in effect.

Schedule 6

Operating Reserve--Supplemental Reserve Service

    Supplemental Reserve Service is needed to serve load in the event 
of a system contingency; however, it is not available immediately to 
serve load but rather within a short period of time. Supplemental 
Reserve Service may be provided by generating units that are on-line 
but unloaded, by quick-start generation or by interruptible load. The 
Transmission Provider must offer this service when the transmission 
service is used to serve load within its Control Area. The Transmission 
Customer must either purchase this service from the Transmission 
Provider or make alternative comparable arrangements to satisfy its 
Supplemental Reserve Service obligation. The charges for Supplemental 
Reserve Service are referred to below. The amount of Supplemental 
Reserve Service will be set forth in the Service Agreement. To the 
extent the Control Area operator performs this service for the 
Transmission Provider, charges to the Transmission Customer are to 
reflect only a pass-through of the costs charged to the Transmission 
Provider by that Control Area operator.
    The Transmission System specific charges for Operating Reserve--
Supplemental Reserve Service are set forth in the appropriate rate 
schedule attached to and made part of the applicable Service Agreement. 
The rates or rate methodology used to calculate the charges for service 
under this schedule were promulgated and may be modified pursuant to 
applicable Federal laws, regulations and policies.
    The Transmission Provider may modify the charges for Operating 
Reserve--Supplemental Reserve Service upon written notice to the 
Transmission Customer. Any change to the charges to the Transmission 
Customer for Operating Reserve--Supplemental Reserve Service shall be 
as set forth in a subsequent rate schedule promulgated pursuant to 
applicable Federal laws, regulations and policies and attached to and 
made part of the applicable Service Agreement. The Transmission 
Provider shall charge the Transmission Customer in accordance with the 
rate then in effect.

Schedule 7

Long-Term Firm and Short-Term Firm Point-to-Point Transmission Service

    The Transmission Customer shall compensate the Transmission 
Provider each month for Reserved Capacity pursuant to the Transmission 
System specific Firm Point-to-Point Transmission Service Rate Schedule 
attached to and made a part of the applicable Service Agreement. The 
rates or rate methodology used to calculate the charges for service 
under this schedule were promulgated and may be modified pursuant to 
applicable Federal laws, regulations and policies.
    The Transmission Provider 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 Service shall be as set forth in a 
subsequent rate schedule promulgated pursuant to applicable Federal 
laws, regulations and policies and attached to and made part of the 
applicable Service Agreement. The Transmission Provider shall charge 
the Transmission Customer in accordance with the rate then in effect.
    Discounts: Three principal requirements apply to discounts for 
transmission service as follows: (1) Any offer of a discount made by 
the Transmission Provider must be announced to all Eligible Customers 
solely by posting on the OASIS, (2) any customer-initiated requests for 
discounts, including requests for use by one's wholesale merchant or an 
affiliate's use, must occur solely by posting on the OASIS, and (3) 
once a discount is negotiated, details must be immediately posted on 
the OASIS. For any discount agreed upon for service on a path, from 
Point(s) of Receipt to Point(s) of Delivery, the Transmission Provider 
must offer the same discounted transmission service rate for the same 
time period to all Eligible Customers on all unconstrained transmission 
paths that go to the same point(s) of delivery on the Transmission 
System.

Schedule 8

Non-Firm Point-To-Point Transmission Service

    The Transmission Customer shall compensate the Transmission 
Provider for Non-Firm Point-to-Point Transmission Service pursuant to 
the Transmission System specific Non-Firm Point-to-Point Transmission 
Service Rate Schedule attached to and made a part of the applicable 
Service Agreement. The rates or rate methodology used to calculate the 
charges for service under this schedule were promulgated and may be 
modified pursuant to applicable Federal laws, regulations and policies.
    The Transmission Provider may modify the charges for Non-Firm 
Point-to-Point Transmission Service upon written notice to the 
Transmission Customer. Any change to the charges to the Transmission 
Customer for Non-Firm Point-to-Point Transmission Service shall be as 
set forth in a subsequent rate schedule promulgated pursuant to 
applicable Federal laws, regulations and policies and attached to and 
made part of the applicable Service Agreement. The Transmission 
Provider shall charge the Transmission Customer in accordance with the 
rate then in effect.
    Discounts: Three principal requirements apply to discounts for 
transmission service as follows: (1) Any offer of a discount made by 
the Transmission Provider must be announced to all Eligible Customers 
solely by posting on the OASIS, (2) any customer-initiated requests for 
discounts, including requests for use by one's wholesale merchant or an 
affiliate's use, must occur solely by posting on the OASIS, and (3) 
once a discount is negotiated, details must be immediately posted on 
the OASIS. For any discount agreed upon for service on a path, from 
Point(s) of Receipt to Point(s) of Delivery, the Transmission Provider 
must offer the same discounted transmission service rate for the same 
time period to all Eligible Customers on all unconstrained transmission 
paths that go to the same point(s) of delivery on the Transmission 
System.

Attachment A

Form of Service Agreement for Firm Point-To-Point Transmission Service

    1.0  This Service Agreement, dated as of ____________, is 
entered into, by and between the (Region) of Western Area Power 
Administration (Transmission Provider), and __________ (Transmission 
Customer). The Transmission Provider may revise charges or losses 
for Firm Point-to-Point Transmission Service provided under this 
Service

[[Page 554]]

Agreement pursuant to applicable Federal Laws, regulations and 
policies upon written notice to the Transmission Customer.
    2.0  The Transmission Customer has been determined by the 
Transmission Provider to have a Completed Application for Firm 
Point-To-Point Transmission Service under the Tariff.
    3.0  The Transmission Customer has provided to the Transmission 
Provider a nonrefundable Application processing fee in accordance 
with the provisions of Section 17.3 of the Tariff.
    4.0  Service under this agreement shall commence on the later of 
(1) the requested Service Commencement Date, or (2) the date on 
which construction of any Direct Assignment Facilities and/or 
Network Upgrades are completed, or (3) such other date as is 
mutually agreed. Service under this agreement shall terminate on 
__________.
    5.0  The Transmission Provider agrees to provide and the 
Transmission Customer agrees to take and pay for Firm Point-To-Point 
Transmission Service in accordance with the provisions of Part II of 
the Tariff, and this Service Agreement.
    6.0  Any notice or request made to or by either Party regarding 
this Service Agreement shall be made to the representative of the 
other Party as indicated below.

Transmission Provider:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
Transmission Customer:

----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
    7.0  The Tariff and the ``Specifications For Long-Term Firm 
Point-To-Point'' as presently constituted or as they may be revised 
or superseded are incorporated herein and made a part hereof.
    In Witness Whereof, the Parties have caused this Service 
Agreement to be executed by their respective authorized officials.

WESTERN AREA POWER ADMINISTRATION
By:--------------------------------------------------------------------
Title:-----------------------------------------------------------------
Address:---------------------------------------------------------------
----------------------------------------------------------------------
Date:------------------------------------------------------------------

(TRANSMISSION CUSTOMER)

By:--------------------------------------------------------------------
Title:-----------------------------------------------------------------
Address:---------------------------------------------------------------
----------------------------------------------------------------------
Date:------------------------------------------------------------------

Specifications for Long-Term Firm Point-To-Point Transmission Service

    For purposes of this Service Agreement, the Transmission 
Provider's Transmission System consists of the facilities of the 
(Region) as described in Attachment K.
1.0  Term of Transaction-----------------------------------------------
Start Date:------------------------------------------------------------
Termination Date:------------------------------------------------------
2.0  Description of capacity and energy to be transmitted by 
Transmission Provider including the electric Control Area in which 
the transaction originates.
----------------------------------------------------------------------
3.0  Point(s) of Receipt:----------------------------------------------
Delivering Party:------------------------------------------------------
Capacity Reservation:--------------------------------------------------
4.0  Point(s) of Delivery:---------------------------------------------
Receiving Party:-------------------------------------------------------
Capacity Reservation:--------------------------------------------------
5.0  The Maximum amount of capacity and energy to be transmitted 
(Reserved Capacity) is : __________
6.0  Designation of party(ies) subject to reciprocal service 
obligation:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
7.0  Name of the Control Area from which capacity and energy will be 
delivered to the Transmission Provider for Transmission Service:
----------------------------------------------------------------------
Name of the Control Area to which capacity and energy will be 
delivered by the Transmission Provider:
----------------------------------------------------------------------
Name(s) of any Intervening Systems providing transmission service:
----------------------------------------------------------------------
----------------------------------------------------------------------
8.0  Service under this Agreement may be subject to some combination 
of the charges detailed below. The appropriate charges for 
individual transactions will be determined in accordance with the 
terms and conditions of the Tariff.
8.1  Transmission Charge:
----------------------------------------------------------------------
8.2  System Impact and/or Facilities Study Charge(s):
----------------------------------------------------------------------
----------------------------------------------------------------------
8.3  Direct Assignment Facilities Charge:
----------------------------------------------------------------------
8.4   Ancillary Services Charges:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
8.5  Redispatch Charges:
    To be filled in if applicable.
8.6  Network Upgrade Charges:
    To be filled in if applicable.

9.0  Power Factor: The Transmission Customer will be required to 
maintain a power factor between__-percent lagging and__-percent 
leading for all deliveries of capacity and energy to and from the 
Transmission Provider's Transmission System.
10.0  Transmission Losses:
    10.1  Loss Factors:
    10.1.1  If, based on operating experience and technical studies, 
the Transmission Provider determines that any of the transmission 
loss factors on the Transmission Provider's Transmission System 
differs from the loss factors set forth in this Service Agreement, 
the Transmission Provider will notify the Transmission Customer of 
the revised loss factor(s) pursuant to Section 1.0 of this Service 
Agreement.
    10.1.2  Transmission Provider Transmission Loss Factor: 
Transmission Provider transmission losses shall initially be__% and 
shall be assessed on the power scheduled and transmitted to a point 
of delivery on the Transmission Provider's Transmission System.
11.0  Ancillary Services
    11.1  Provided by Transmission Provider
    11.1.1  Scheduling, System Control, and Dispatch Service
    11.1.2  Reactive Supply and Voltage Control from Generation 
Sources Service
11.2  Provided by Transmission Customer
    11.2.1  (To be filled in if applicable)
    11.2.2
11.3 Provided by______
    11.3.1  (To be filled in if applicable)
    11.3.2  
12.0  Net Billing and Bill Crediting Option: The Parties have agreed 
to implement [Net Billing, Bill Crediting, or both] as set forth in 
Attachment J.
13.0  Charges for Service: Charges for Firm Point-to-Point 
Transmission Service and associated Ancillary Services shall be 
calculated in accordance with [Rate Schedules] attached hereto and 
made a part of this Service Agreement. The rates or rate methodology 
used to calculate the charges for service under that schedule were 
promulgated and may be modified pursuant to applicable Federal laws, 
regulations and policies. [This section will be included as 
appropriate at the Transmission Provider's discretion]
14.0  Independent System Operator: The Parties understand that the 
Transmission Provider may join an independent system operator under 
Commission jurisdiction. In the event the Transmission Provider 
either joins or is required to conform to protocols of the 
independent system operator, the Parties agree that the Transmission 
Provider either may (1) may make any changes necessary to conform to 
the terms and conditions required by Commission approval of the 
independent system operator, or (2) terminate this Service Agreement 
by providing a one-year written notice to the Transmission Customer.

Attachment B

Form of Service Agreement for Non-Firm Point-To-Point Transmission 
Service

    1.0  This Service Agreement, dated as of________, is entered 
into, by and between the (Region) of Western Area Power 
Administration (Transmission Provider), and________(Transmission 
Customer). The Transmission Provider may revise charges or losses 
for Non-Firm Point-to-Point Transmission Service provided under this 
Service Agreement pursuant to applicable Federal laws, regulations 
and policies upon written notice to the Transmission Customer.
    2.0  The Transmission Customer has been determined by the 
Transmission Provider to be a Transmission Customer under Part II of 
the Tariff and has filed a Completed Application for Non-Firm Point-
To-Point Transmission Service in accordance with Section 18.2 of the 
Tariff.
    3.0  Service under this Service Agreement shall be provided by 
the Transmission Provider upon request by an authorized 
representative of the Transmission Customer.

[[Page 555]]

For purposes of this Service Agreement, the Transmission Provider's 
Transmission System consists of the facilities of the (Region) as 
described in Attachment K.
    4.0  The Transmission Customer agrees to supply information the 
Transmission Provider deems reasonably necessary in accordance with 
Good Utility Practice in order for it to provide the requested 
service.
    5.0  The Transmission Provider agrees to provide and the 
Transmission Customer agrees to take and pay for Non-Firm Point-To-
Point Transmission Service in accordance with the provisions of Part 
II of the Tariff, and this Service Agreement.
    6.0  Any notice or request made to or by either Party regarding 
this Service Agreement shall be made to the representative of the 
other Party as indicated below.

Transmission Provider:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------

Transmission Customer:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------

    7.0  The Tariff as presently constituted or as it may be revised 
or superseded is incorporated herein and made a part hereof.
    8.0  Power Factor: The Transmission Customer will be required to 
maintain a power factor between __-percent lagging and __-percent 
leading for all deliveries of capacity and energy to and from the 
Transmission Provider's Transmission System.
    9.0  Transmission Losses:
    9.1  Loss Factors:
    9.1.1  If, based on operating experience and technical studies, 
the Transmission Provider determines that any of the transmission 
loss factors on the Transmission Provider's Transmission System 
differs from the loss factors set forth in this Service Agreement, 
the Transmission Provider will notify the Transmission Customer of 
the revised loss factor(s) pursuant to Section 1.0 of this Service 
Agreement.
    9.1.2  Transmission Provider Transmission Loss Factor: 
Transmission Provider transmission losses shall initially be ______% 
and shall be assessed on the power scheduled and transmitted to a 
point of delivery on the Transmission Provider's Transmission 
System.
    10.0  Ancillary Services
    10.1  Provided by Transmission Provider
    10.1.1  Scheduling, System Control, and Dispatch Service
    10.1.2  Reactive Supply and Voltage Control from Generation 
Sources Service
    10.2  Provided by Transmission Customer
    10.2.1  To be filled in if appropriate
    10.2.2
    10.3  Provided by ______
    10.3.1  To be filled in if appropriate
    10.3.2
    11.0  Net Billing and Bill Crediting Option: The Parties have 
agreed to implement [Net Billing, Bill Crediting, or both] as set 
forth in Attachment J.
    12.0  Charges for Service: Charges for Non-Firm Point-to-Point 
Transmission Service and associated Ancillary Services shall be 
calculated in accordance with [Rate Schedules] attached hereto and 
made a part of this Service Agreement. The rates or rate methodology 
used to calculate the charges for service under that schedule were 
promulgated and may be modified pursuant to applicable Federal laws, 
regulations and policies. [This section will be included as 
appropriate at the Transmission Provider's discretion.]
    13.0  Independent System Operator: The Parties understand that 
the Transmission Provider may join an independent system operator 
under Commission jurisdiction. In the event the Transmission 
Provider either joins or is required to conform to protocols of the 
independent system operator, the Parties agree that the Transmission 
Provider either may (1) may make any changes necessary to conform to 
the terms and conditions required by Commission approval of the 
independent system operator, or (2) terminate this Service Agreement 
by providing a one-year written notice to the Transmission Customer.
    In Witness Whereof, the Parties have caused this Service 
Agreement to be executed by their respective authorized officials.

WESTERN AREA POWER ADMINISTRATION
By:--------------------------------------------------------------------
Title:-----------------------------------------------------------------
Address:---------------------------------------------------------------
----------------------------------------------------------------------
Date:------------------------------------------------------------------

(TRANSMISSION CUSTOMER)
By:--------------------------------------------------------------------
Title:-----------------------------------------------------------------
Address:---------------------------------------------------------------
Date:------------------------------------------------------------------

Attachment C

Methodology To Assess Available Transmission Capability

    The Transmission Provider will compute the transmission transfer 
capability available on a point-to-point basis from the Delivering 
Party to the Receiving Party using Good Utility Practice and the 
engineering and operating principles, standards, guidelines and 
criteria of the Transmission Provider, the applicable Regional 
Reliability Council, any entity of which the Transmission Provider 
is a member and is approved by the Commission to promulgate or apply 
regional or national reliability planning standards (such as a 
regional transmission group, RTG), or any similar organization that 
may exist in the future of which the Transmission Provider is then a 
member. Principal items used to determine maximum transmission 
transfer capability available shall include reliability, 
transmission element loading, system contingency performance, 
voltage levels, and stability. In determining Available Transmission 
Capability, the Transmission Provider will reserve sufficient 
transmission capability to meet its current and forecasted power 
service obligations, current and forecasted Network Customer loads, 
and existing transmission service obligations.

Attachment D

Methodology for Completing a System Impact Study

    The Transmission Provider will assess the capability of the 
Transmission System to provide the service requested using the 
criteria and process for this assessment as detailed in Sections 4 
and 5 of the Transmission Provider's annual FERC Form 715 submittal 
in those instances where the Transmission Provider is a member of 
the Western Systems Coordinating Council. (CRSP, DSW, RMR, and SNR) 
The Transmission Provider will use the Mid-Continent Area Power Pool 
(MAPP) System Impact Study Methodology when the Transmission 
Provider is a member of MAPP. (UGPR)

Attachment E

Index of Point-To-Point Transmission Service Customers

------------------------------------------------------------------------
                 Customer                     Date of service agreement 
------------------------------------------------------------------------
                                                                        
                                                                        
                                                                        
------------------------------------------------------------------------

Attachment F

Service Agreement for Network Integration Transmission Service

    1.0  This Service Agreement, dated as of ________, is entered 
into, by and between the (Region) of Western Area Power 
Administration (Transmission Provider), and ________ (Transmission 
Customer).
    2.0  The Transmission Customer has been determined by the 
Transmission Provider to have a Completed Application for Network 
Integration Transmission Service under the Tariff.
    3.0  Service under this Service Agreement shall commence on the 
later of (1) ________, or (2) the date on which construction of any 
Direct Assignment Facilities and/or Network Upgrades are completed, 
or (3) such other date as is mutually agreed upon. Service under 
this Service Agreement shall terminate on ________.
    4.0  The Transmission Provider agrees to provide and the 
Transmission Customer agrees to take and pay for Network Integration 
Transmission Service in accordance with the provisions of Part III 
of the Tariff, and this Service Agreement.
    5.0  Any notice or request made to or by either Party regarding 
this Service Agreement shall be made to the representative of the 
other Party as indicated below.

Transmission Provider:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------

Transmission Customer:
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
    6.0  The Tariff and the ``Specifications for Network Integration 
Transmission Service'' as presently constituted or as they may be

[[Page 556]]

revised or superseded are incorporated herein and made a part 
hereof.
    IN WITNESS WHEREOF, the Parties have caused this Service 
Agreement to be executed by their respective authorized officials.

WESTERN AREA POWER ADMINISTRATION
By:--------------------------------------------------------------------
Title:-----------------------------------------------------------------
Address:---------------------------------------------------------------
----------------------------------------------------------------------
Date:------------------------------------------------------------------

(TRANSMISSION CUSTOMER)
By:--------------------------------------------------------------------
Title:-----------------------------------------------------------------
Address:---------------------------------------------------------------
----------------------------------------------------------------------
Date:------------------------------------------------------------------

Specifications for Network Integration Transmission Service

    For purposes of this Service Agreement, the Transmission 
Provider's Transmission System consists of the facilities of the 
(Region) as described in Attachment K.
    1.0  The Transmission Provider will provide Network Integration 
Transmission Service over the Transmission Provider's Transmission 
System for the delivery of capacity and energy from the Network 
Customer's designated Network Resources to the Network Customer's 
designated Network Load. The Transmission Provider will also provide 
non-firm transmission service from non-designated Network Resources 
under the terms of this Service Agreement. The loss factors 
associated with this Network Integration Transmission Service are 
set forth below. Such losses shall be applied and accounted for as 
set forth in Section 4.
    2.0  Designated Network Resources:

------------------------------------------------------------------------
Designated network resources                                            
     & estimated maximum        Point of receipt    Delivering party and
        resource (MW)                                      voltage      
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------

    3.0  Designated Network Loads:

------------------------------------------------------------------------
  Designated network load &                                             
 estimated maximum resource     Point of delivery          Voltage      
            (MW)                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------
                                                                        
------------------------------------------------------------------------

    4.0  Transmission Losses:
    4.1  Loss Factors:
    4.1.1  If, based on operating experience and technical studies, 
the Transmission Provider determines that any of the transmission 
loss factors on the Transmission Provider's Transmission System 
differs from the loss factors set forth in this Service Agreement, 
the Transmission Provider will notify the Transmission Customer of 
the revised loss factor(s) pursuant to Section 1.0 of this Service 
Agreement.
    4.1.2  Transmission Provider Transmission Loss Factor: For 
deliveries to the Network Customer Network Load, Transmission 
Provider transmission losses shall initially be __% and shall be 
assessed on the power scheduled and transmitted to a point of 
delivery on the Transmission Provider's Transmission System.
    4.2  Transmission losses may be revised by written notice from 
the Transmission Provider to the Transmission Customer.
    5.0  The Network Customer's transmission facilities that are 
integrated with the Transmission Provider's Transmission System will 
receive ____ credit. These facilities include the following:
    5.1  ________
    5.2  ________
    6.0  Names of any intervening systems with whom the Network 
Customer has arranged for transmission service to the Transmission 
Provider's Transmission System.
    6.1  ________
    6.2  ________
    7.0  Power Factor: The Transmission Customer will be required to 
maintain a power factor between ____-percent lagging and ____-
percent leading for all deliveries of capacity and energy to and 
from the Transmission Provider's Transmission System.
    8.0  Ancillary Services
    8.1  Provided by Transmission Provider
    8.1.1  Scheduling, System Control, and Dispatch Service
    8.1.2  Reactive Supply and Voltage Control from Generation 
Sources Service
    8.2  Provided by Transmission Customer
    8.2.1  (To be filled in if appropriate)
    8.2.2
    8.3  Provided by ________
    8.3.1  (To be filled in if appropriate)
    8.3.2
    9.0  Net Billing and Bill Crediting Option: The Parties have 
agreed to implement [Net Billing, Bill Crediting, or both] as set 
forth in Attachment J.
    10.0  Charges for Service: Charges for associated Ancillary 
Services shall be calculated in accordance with [Rate Schedule] 
attached hereto and made a part of this Service Agreement. The rates 
or rate methodology used to calculate the charges for service under 
that schedule were promulgated and may be modified pursuant to 
applicable Federal laws, regulations and policies. [This section 
will be included as appropriate at the Transmission Provider's 
discretion]
    11.0  Independent System Operator: The Parties understand that 
the Transmission Provider may join an independent system operator 
under Commission jurisdiction. In the event the Transmission 
Provider either joins or is required to conform to protocols of the 
independent system operator, the Parties agree that the Transmission 
Provider either (1) may make any changes necessary to conform to the 
terms and conditions required by Commission approval of the 
independent system operator, or (2) terminate this Service Agreement 
by providing a one-year written notice to the Transmission Customer.

Attachment G

Network Operating Agreement

    To be filed by the Transmission Provider at such time as the 
Transmission Provider has negotiated or offered a Network 
Integration Transmission Service Agreement. The terms and conditions 
under which the Network Customer will be required to operate its 
facilities and the technical and operational matters associated with 
the implementation of Network Integration Transmission Service and 
this Service

[[Page 557]]

Agreement will be specified in a separate Network Operating 
Agreement.
    The Network Operating Agreement will include provisions 
addressing the following:

Authorized Representatives of the Parties
Network Operating Committee
Load Following
System Protection
Redispatch to Manage Transmission Constraints
Maintenance of Facilities
Load Shedding
Operation Impacts
Service Conditions
Data, Information and Reports
Metering
Communications
System Regulation and Operating Reserves
Assignment
Notices
Accounting for Transmission Losses
(Alternative language to be used only by UGPR) Network Integration

    Transmission provided by the Transmission Provider will be 
subject to all operating and scheduling procedures and protocols of 
the Mid-Continent Area Power Pool (MAPP) as stated in the MAPP 
Restated Agreement and the MAPP Operating Handbook as existing and 
as may be amended, superseded or replaced. The Transmission Provider 
will, therefore, not enter into a separate Network Operating 
Agreement with each Network Customer.

Attachment H

Annual Transmission Revenue Requirement for Network Integration 
Transmission Service

    1.0  The Annual Transmission Revenue Requirement for purposes of 
the Network Integration Transmission Service is to be set forth in a 
separate Rate Schedule.
    2.0  The amount in 1 shall be effective until amended by the 
Transmission Provider or modified by the Commission pursuant to 
applicable Federal laws, regulations and policies, and may be 
revised upon written notice to the Transmission Customer.

Attachment I

Index of Network Integration Customers

------------------------------------------------------------------------
                 Customer                     Date of service agreement 
------------------------------------------------------------------------
                                                                        
                                                                        
                                                                        
------------------------------------------------------------------------

Attachment J

Provisions Specific to the Transmission Provider

1.0  Change of Rates

    Rates applicable under the Service Agreements shall be subject 
to change by Western in accordance with appropriate rate adjustment 
procedures. If at any time the United States promulgates a rate 
changing a rate then in effect under a Service Agreement, it will 
promptly notify the Transmission Customer thereof. Rates shall 
become effective as to the Service Agreements as of the effective 
date of such rate. The Transmission Customer, by written notice to 
the Transmission Provider within ninety (90) days after the 
effective date of a rate change, may elect to terminate the service 
billed by the Transmission Provider under the new rate. Said 
termination shall be effective on the last day of the billing period 
requested by the Transmission Customer not later than two (2) years 
after the effective date of the new rate. Service provided by the 
Transmission Provider shall be paid for at the new rate regardless 
of whether the Transmission Customer exercises the option to 
terminate service.

2.0  Contingent Upon Appropriations

    Where activities provided for in the Service Agreement extend 
beyond the current fiscal year, continued expenditures by the 
Transmission Provider are contingent upon Congress making necessary 
appropriations required for the continued performance of the 
Transmission Provider's obligations under the Service Agreement. In 
the event that such appropriation by Congress is not made, the 
Transmission Customer hereby releases the Transmission Provider from 
its obligations under the Service Agreement and from all liability 
due to the failure of Congress to make such appropriation.

3.0  Covenant Against Contingent Fees

    The Transmission Customer warrants that no person or selling 
agency has been employed or retained to solicit or secure the 
Service Agreement upon a contract or understanding for a commission, 
percentage, brokerage, or contingent fee, excepting bona fide 
employees or bona fide established commercial or selling agencies 
maintained by the Transmission Customer for the purpose of securing 
business. For breach or violation of this warranty, the Transmission 
Provider shall have the right to annul the Service Agreement without 
liability or in its discretion to deduct from the Service Agreement 
price or consideration the full amount of such commission, 
percentage, brokerage, or contingent fee.

4.0  Contract Work Hours and Safety Standards

    The Service Agreement, to the extent that it is of a character 
specified in Section 103 of the Contract Work Hours and Safety 
Standards Act (Act), 40 U.S.C. 329 (1986), is subject to the 
provisions of the Act, 40 U.S.C. 327-333 (1986), and to regulations 
promulgated by the Secretary of Labor pursuant to the Act.

5.0  Equal Opportunity Employment Practices

    Section 202 of Executive Order No. 11246, 43 FR 46501 (1978), 
which provides, among other things, that the Transmission Customer 
will not discriminate against any employee or applicant for 
employment because of race, color, religion, sex, or national 
origin, is incorporated by reference in the Service Agreement.

6.0  Use of Convict Labor

    The Transmission Customer agrees not to employ any person 
undergoing sentence of imprisonment in performing the Service 
Agreement except as provided by 18 U.S.C. 4082(c)(2) and Executive 
Order 11755, December 29, 1973.

7.0  Entire Agreement

    The Service Agreements, including the Tariff, together with the 
specifications under such Service Agreement and any completed 
scheduling forms shall constitute the entire understanding between 
the Transmission Provider and the Transmission Customer with respect 
to Transmission Service thereunder.

8.0  Power Supply Obligations

    The Transmission Provider shall not be obligated to supply 
capacity and energy from its own sources or from its purchases from 
other neighboring systems during Interruptions or Curtailments in 
the delivery by the Transmission Provider or delivery to the 
Transmission Provider by the Delivering Party of capacity and energy 
for Transmission Service hereunder, and nothing in the Service 
Agreement or in the Transmission Customer's agreements with others 
shall have the effect of making, nor shall anything in the Service 
Agreement or said agreements with others be construed to require the 
Transmission Provider to take any action which would make the 
Transmission Provider, directly or indirectly, a source of power 
supply to the Transmission Customer, to any Delivering Party or 
Receiving Party, or to any ultimate recipient other than through the 
provision of Operating Reserve Service.

9.0  Federal Law

    Performance under the Tariff and Service Agreement shall be 
governed by applicable Federal law.

10.0  Continuing Obligations

    The applicable provisions of the Service Agreement will continue 
in effect after termination of the Service Agreement to the extent 
necessary to provide for final billing, billing adjustments and 
payments, and with respect to liability and indemnification from 
acts or events that occurred while this Service Agreement was in 
effect.

11.0  Net Billing

    As mutually agreed in the Service Agreement, payments due the 
Transmission Provider by a Transmission Customer may be offset 
against payments due the Transmission Customer by the Transmission 
Provider for the use of transmission facilities, operation and 
maintenance of electric facilities, and other services. For services 
included in net billing procedures, payments due one Party in any 
month shall be offset against payments due the other Party in such 
month, and the resulting net balance shall be paid to the Party in 
whose favor such balance exists. The Parties shall exchange such 
reports and information that either Party requires for billing 
purposes. Net billing shall not be used for any amounts due which 
are in dispute.

12.0  Bill Crediting

    As mutually agreed in the Service Agreement, payments due the 
Transmission Provider by a Transmission Customer shall be paid by a 
Transmission Customer to a third party when so directed by the

[[Page 558]]

Transmission Provider. Any third party designated to receive payment 
in lieu of the Transmission Provider, and the amount to be paid to 
that party, will be so identified in writing to a Transmission 
Customer with the monthly power bill. The payment to the third party 
shall be due and payable by the payment due date specified on the 
Transmission Provider's bill. When remitting payment to a designated 
third party, a Transmission Customer shall indicate that such 
payment is being made on behalf of the Transmission Provider. The 
Transmission Provider shall credit a Transmission Customer for the 
amount paid as if payment had been made directly to the Transmission 
Provider. All other payment provisions shall remain in full force 
and effect.

Attachment K

Authorities and Obligations

    Western Area Power Administration (Western) was established on 
December 21, 1977, pursuant to Section 302 of the Department of 
Energy (DOE) Organization Act, Public Law 95-91, dated August 4, 
1977. By law, the Bureau of Reclamation provides Federal power 
resources to its project use customers. By law, Western markets 
Federal power resources to its electric service customers. Western's 
transmission system was built primarily to enable the delivery of 
Federal power to satisfy these contractual obligations.
    Western is not a public utility under Sections 205 and 206 of 
the Federal Power Act and is not specifically subject to the 
requirements of the Federal Energy Regulatory Commission's (FERC or 
Commission) Final Orders No. 888 and 888-A. Western is a 
transmitting utility subject to Section 211 of the Federal Power Act 
as amended by the Energy Policy Act of 1992. The Department of 
Energy has issued a Power Marketing Administration Open Access 
Transmission Policy that supports the intent of the FERC Notice of 
Proposed Rulemaking for Open Access Transmission.
    Use of transmission facilities that Western owns, operates, or 
to which it has contract rights for delivery of Federal long-term 
firm capacity and energy to project use and electric service 
customers is a Western responsibility under the terms and conditions 
of marketing criteria and electric service contracts implementing 
statutory obligations to market Federal power. This is complementary 
with the provisions of the Tariff. Transmission service provided by 
Western under the Tariff is solely for the use of available 
transmission capability in excess of the capability Western requires 
for the delivery of long-term firm capacity and energy to project 
use and electric service customers of the Federal government. 
Western will offer to provide others transmission service equivalent 
to the service Western provides itself.
    Western's Regional Offices reserved transmission capacity shall, 
therefore, include capacity sufficient to deliver Federal power 
resources to customers of the Federal government. Nothing in this 
Tariff shall alter, amend or abridge the statutory or contractual 
obligations of Western to market and deliver Federal power resources 
and to repay the Federal investment in such projects. The Tariff 
provides for transmission, including each Regional Office's use of 
those facilities for third party sales, on the unused capability of 
transmission facilities under the jurisdiction or control of each of 
Western's Regional Offices not required for the delivery of long 
term firm capacity and energy to customers of the Federal government 
in a manner consistent with the spirit and intent of FERC Order Nos. 
888 and 888-A.
    Western has prepared this Tariff and service agreements to 
provide transmission service comparable to that required of public 
utilities by FERC Order Nos. 888 and 888-A, and to implement those 
Orders consistent with the DOE Policy. An entity desiring 
transmission service from Western must comply with the application 
procedures outlined herein. The review and approval requirements 
detailed herein will apply to all requesting parties. Western will 
perform the necessary studies or assessments for evaluating requests 
for transmission service as set forth in the Tariff. Any facility 
construction or interconnection necessary to provide transmission 
service will be subject to Western's General Requirements for 
Interconnection which are available upon request.
    Western will provide Firm and Non-Firm Point-to-Point 
Transmission Service and Network Integration Transmission Service 
under this Tariff. The specific terms and conditions for providing 
transmission service to a customer will be included in a Service 
Agreement. Operating Procedures, Available Transmission Capability 
(ATC), and System Impact Methodology are defined in the Attachments. 
Western's rates are developed under separate public processes 
pursuant to applicable Federal law and regulations. Therefore, rates 
and charges for specific services will be set forth in the 
appropriate Regional rates schedules attached to each Service 
Agreement.
    Western has marketed the maximum practical amount of power from 
each of its projects, leaving little or no flexibility for provision 
of additional power services. Changes in water conditions frequently 
affect the ability of hydroelectric projects to meet obligations on 
a short term basis. The unique characteristics of the hydro 
resource, Western's marketing plans and the limitations of the 
resource due to changing water conditions limit Western's ability to 
provide generation-related services including ancillary services and 
redispatching using Federal hydro resources.
    Western operates in 15 Central and Western States encompassing a 
geographic area of 3.38 million-square-kilometers (1.3 million-
square-miles). Western has four Customer Service Regional Offices 
and the Colorado River Storage Project Customer Service Center, each 
referred to in the Tariff as Regional Office. The addresses for 
submitting applications to Western's Regional Offices are as 
follows: Colorado River Storage Project, CRSP Manager, P.O. Box 
11606, Salt Lake City, UT, 84147-0606, telephone number (801) 524-
6372; Desert Southwest Region, Power Marketing Manager, P.O. Box 
6457, Phoenix, AZ, 95005-6457, telephone number (602) 352-2789; 
Rocky Mountain Region, Power Marketing Manager, P.O. Box 3700, 
Loveland, CO, 80539-3003, telephone number (970) 490-7370; Sierra 
Nevada Region, Power Marketing Manager, 114 Parkshore Drive, Folsom, 
CA, 95630-4710, telephone number (916) 353-4421; Upper Great Plains 
Region, Power Marketing Manager, P.O. Box 35800, Billings, MT, 
59107-5800, telephone number (406) 247-7394.

Colorado River Storage Project Customer Service Center

    The Colorado River Storage Project Customer Service Center (CRSP 
CSC), located in Salt Lake City, Utah, markets power from three 
Federal multipurpose water development projects; the Colorado River 
Storage Project (CRSP), the Collbran Project, and the Rio Grande 
Project, collectively called the Integrated Projects. The 
hydroelectric facilities associated with these projects include: 
Flaming Gorge and Fontenelle powerplants on the Green River; Blue 
Mesa, Morrow Point, and Crystal powerplants on the Gunnison River; 
Upper and Lower Molina powerplants of the Collbran Project in 
Western Colorado; the largest of the CRSP facilities, Glen Canyon 
power plant on the Colorado River; and Elephant Butte power plant, 
part of the Rio Grande Project on the Rio Grande River in South 
Central New Mexico. The CRSP transmission system consists of high-
voltage transmission lines and attendant facilities extending from 
Arizona, into New Mexico, through Colorado, and into portions of 
Utah and Wyoming. The CRSP CSC uses the CRSP transmission system to 
meet its commitments to its federal customers, point-to-point 
transmission customers, and exchange power contractors. The CRSP CSC 
must, therefore, reserve sufficient transmission capacity to meet 
these long-term obligations. The CRSP CSC also needs to reserve 
capacity in its transmission system to enable it to deliver power 
produced by the Integrated Projects hydroelectric powerplants during 
periods when flood control water releases produce greater than 
normal generation levels.
    The CRSP CSC office, located in Salt Lake City, is a member of 
the Western Regional Transmission Group and Southwest Regional 
Transmission Group and operates within the Western Systems 
Coordinating Council (WSCC).
    The CRSP CSC does not operate a control area and as such may be 
unable to provide some or all of the services under the Tariff from 
its Integrated Projects hydroelectric resources, including, but not 
limited to, ancillary services and Network Integration Transmission 
Service.
    The CRSP CSC application processing fee will be $1,600.

Desert Southwest Region

    The Desert Southwest Region (DSR) manages transmission 
facilities in the states of Arizona, California, and Nevada. The DSR 
transmission facilities are interconnected with transmission 
facilities of several non-Federal entities. DSR is a member of the 
Southwest Regional Transmission Group and the Western Regional 
Transmission Group

[[Page 559]]

and its system is operated in the WSCC. For the purpose of 
implementing this Tariff the transmission facilities of the Parker-
Davis Projects and the Pacific Northwest-Pacific Southwest Intertie 
Project will be utilized. DSR manages a control area operations 
center through its Desert Southwest Regional Office located in 
Phoenix, Arizona.
    The DSR application processing fee will be $1,700.

Rocky Mountain Region

    The Rocky Mountain Region (RMR) manages transmission facilities 
in the states of Colorado, Wyoming, Nebraska, and Kansas which were 
constructed for the primary purpose of marketing power from the 
Pick-Sloan Missouri Basin Program--Western Division. The RMR office 
and control area operations center is located in Loveland, Colorado. 
The RMR is a member of the Western Regional Transmission Group and 
its system is operated in the Western Systems Coordinating Council.
    For RMR, the rates for Point-to-Point and Network Integration 
Transmission Service charged pursuant to the Tariff will be 
calculated using the costs of the transmission facilities of the 
Pick-Sloan Missouri Basin Program--Western Division. The rates for 
the ancillary services will be calculated using the costs of the 
generation facilities of the Pick-Sloan Missouri Basin Program--
Western Division and the Fryingpan--Arkansas Project.
    The RMR application processing fee will be $1,600.

Sierra Nevada Region

    The Sierra Nevada Customer Service Region (SNR), located in 
Folsom, California, manages the Central Valley Project (CVP) 
transmission facilities in the state of California. These facilities 
were constructed for the primary purpose of marketing power 
resources from the CVP. SNR also has ownership rights to capacity in 
two multi-party transmission systems, the Pacific Northwest-Pacific 
Southwest Intertie Project (Pacific AC Intertie), and the 
California-Oregon Transmission Project (COTP). Congress authorized 
SNR's participation in the Pacific AC Intertie for the purpose of 
importing power from the Pacific Northwest. COTP rights were 
acquired pursuant to Public Law 98-630, primarily for the purpose of 
delivering power to the United States Department of Energy 
Laboratories (DOE Labs) and Federal Fish and Wildlife refuges. Long-
term use of the Pacific AC Intertie and COTP by third parties is 
restricted under existing contracts. SNR is a member of the Western 
Regional Transmission Group regional transmission group and operates 
within the Western Systems Coordinating Council reliability council.
    The SNR does not operate a control area and as such may be 
unable to provide some or all of the services under the Tariff, 
including but not limited to, ancillary services and Network 
Integration Transmission Service.
    The SNR application processing fee will be $1,300.

Upper Great Plains Region

    The Upper Great Plains Region (UGPR) manages transmission 
facilities in the states of Montana, North Dakota, South Dakota, 
Nebraska, Minnesota, and Iowa which were constructed for the primary 
purpose of marketing power from the Pick-Sloan Missouri Basin 
Program--Eastern Division. The UGPR office is located in Billings, 
Montana. The UGPR manages a control area operations center in 
Watertown, South Dakota. The eastern portion of the UGPR system is 
operated in the Mid-Continent Area Power Pool (MAPP) reliability 
council. The western portion of the system is operated in the 
Western Systems Coordinating Council.
    The UGPR transmission facilities are integrated with the 
transmission facilities of Basin Electric Power Cooperative (Basin) 
and Heartland Consumers Power District (Heartland) such that 
transmission services are provided over an integrated transmission 
system. UGPR rates for Point-to-Point and Network Integration 
Transmission Service charged pursuant to the Tariff will be 
calculated using the costs of the transmission facilities of UGPR, 
Basin, and Heartland that are included in the Transmission System. 
This Transmission System is also called the Integrated System (IS) 
and the rates are identified as IS Rates. The integration of these 
facilities as the IS and the use of the IS rates for short-term 
sales have been approved by the Administrator of Western. The 
definition of the Transmission System and the rates for Point-To-
Point and Network Integration Transmission Service may be subject to 
change upon conclusion of an Open Access Transmission Service rate 
development process conducted pursuant to applicable Federal Law and 
regulations.
    Both Basin and Heartland also own generating facilities and must 
commit to deliver the output of those resources to their respective 
members. Basin and Heartland will, therefore, reserve sufficient 
capacity in their transmission facilities to deliver that output.
    Any Transmission Customer taking service under this Tariff shall 
be subject to a Stranded Cost Charge payable to either UGPR, Basin 
or Heartland if such service is used for the transmission of power 
or energy that replaces wholly or in part, power or energy supplied 
by Western, Basin or Heartland respectively.
    The Stranded Cost Charge of Basin shall be applicable regardless 
of whether the transmission relates to power and/or energy that is 
purchased by or on behalf of a Generation and Transmission 
Cooperative member of Basin (G&T), a Distribution Cooperative member 
of Basin or G&T, or a retail customer of a Distribution Cooperative 
member of Basin or a G&T.
    The Stranded Cost Charge of Heartland shall be applicable 
whether the transmission service relates to power and/or energy that 
is purchased by or on behalf of a municipal customer of Heartland or 
a retail customer of a municipal customer of Heartland.
    Stranded costs will be recovered only from a Transmission 
Customer who obtains transmission service under access rights 
granted through the Transmission Provider's compliance tariff 
developed pursuant to FERC Final Orders No. 888 and 888-A and causes 
either UGPR, Basin or Heartland to incur stranded costs. Stranded 
costs will be recovered through the terms and conditions of a 
separate contract entered into either by UGPR and the Transmission 
Customer or Basin and the Transmission Customer or Heartland and the 
Transmission Customer.
    The UGPR application processing fee will be $1,700.

[FR Doc. 98-128 Filed 1-5-98; 8:45am]
BILLING CODE 6450-01-P