72670 Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 

1WAPA–147 was approved by the Deputy 

Secretary of Energy on December 14, 2009 (74 FR 

67197 (Dec 18, 2009)), and confirmed and approved 

by FERC on a final basis on September 10, 2010, 

in Docket No. EF10–2–000. See United States 

Department of Energy, Western Area Power 

Administration (Pick-Sloan Missouri Basin 

Program—Eastern Division), 132 FERC ¶ 62,159. 

between 95-percent lagging and 95- 

percent leading. 

[FR Doc. 2014–28715 Filed 12–5–14; 8:45 am] 

BILLING CODE 6450–01–P 

DEPARTMENT OF ENERGY 

Western Area Power Administration 

Pick-Sloan Missouri Basin Program— 

Eastern Division-Rate Order No. 

WAPA–166 

AGENCY: Western Area Power 

Administration, DOE. 

ACTION: Notice of Order Concerning 

Firm Power Rates. 

SUMMARY: The Deputy Secretary of 

Energy confirmed and approved Rate 

Order No. WAPA–166 and Rate 

Schedules P–SED–F12 and P–SED– 

FP12, placing firm power and firm 

peaking power rates for the Western 

Area Power Administration (Western) 

Pick-Sloan Missouri Basin Program— 

Eastern Division (P–SMBP—ED) into 

effect on an interim basis. 

DATES: Rate Schedules P–SED–F12 and 

P–SED–FP12 will be placed into effect 

on an interim basis on the first day of 

the first full billing period beginning on 

or after January 1, 2015, and will remain 

in effect until the Federal Energy 

Regulatory Commission (FERC) 

confirms, approves, and places the rate 

schedules or substitute rates in effect on 

a final basis through December 31, 2019, 

or until the rate schedules are 

superseded. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Robert J. Harris, Regional Manager, 

Upper Great Plains Region, Western 

Area Power Administration, 2900 4th 

Avenue North, Billings, MT 59101– 

1266, telephone (406) 255–2800, email 

rharris@wapa.gov, or Ms. Linda CadyHoffman, Rates Manager, Upper Great 

Plains Region, Western Area Power 

Administration, 2900 4th Avenue North, 

Billings, MT 59101–1266, telephone 

(406) 255–2920, email cady@wapa.gov. 

SUPPLEMENTARY INFORMATION: Rate 

Schedules P–SED–F11 and P–SED–FP11 

were approved under Rate Order No. 

WAPA–147 for the period beginning 

January 1, 2010, and ending December 

31, 2014.1 Under the current rate 

methodology, rates for P–SMBP—ED 

firm power and firm peaking power 

service are designed to recover an 

annual revenue requirement that 

includes investment repayment, 

interest, purchase power, operation and 

maintenance, and other expenses within 

the allowable period. The total annual 

revenue requirement for P–SMBP—ED 

remains $320.2 million for firm power 

and firm peaking power service. In 

addition, the overall capacity and 

energy charges are not changing, as the 

existing charges in the current rate 

schedules for firm power and firm 

peaking power continue to provide 

sufficient revenue to meet the P– 

SMBP—ED repayment obligations. The 

Rate Schedules continue to be formula 

based. An incremental upward 

adjustment to the Drought Adder greater 

than the equivalent of 2 mills/kWh to 

the Power Repayment Study (PRS) 

composite rate will require a public 

process. The Drought Adder may be 

adjusted downward pursuant to the 

formula without a public process. 

Rate Schedules P–SED–F11 and P– 

SED–FP11 are being superseded by Rate 

Schedules P–SED–F12 and P–SED– 

FP12, respectively. Under Rate 

Schedule P–SED–F12, the firm capacity 

charge will remain $7.65/kilowattmonth 

(kWmonth), and the firm energy charge 

will remain 19.05 mills/kilowatthour 

(kWh). Under Rate Schedule P–SED– 

FP12, the firm peaking power services 

capacity charge will remain $6.90/

kWmonth, and the energy charge will 

remain 19.05 mills/kWh as of January 1, 

2015. Firm Peaking Energy is normally 

returned. A Firm Peaking Energy charge 

of 19.05 mills/kWh will be assessed in 

the event energy is not returned. The 

Base and Drought Adder components 

associated with these charges are shown 

in Table 1 below: 

TABLE 1—SUMMARY OF P–SMBP—ED CHARGE COMPONENTS

Existing charges under Rate Schedules effective 

(January 1, 2010) P–SED–F11/P–SED–FP11 

Provisional charges under Rate Schedules effective 

(January 1, 2015) P–SED–F12/P–SED–FP12 

Base 

component 

Drought Adder 

component Total charge Base component 

Drought Adder 

component Total charge 

Firm Capacity ($/kWmonth) ............... $3.80 $3.85 $7.65 $4.90 $2.75 $7.65 

Firm Energy (mills/kWh) .................... 9.53 9.52 19.05 12.33 6.72 19.05 

Firm Peaking Capacity ($/kWmonth) $3.45 $3.45 $6.90 $4.45 $2.45 $6.90 

Firm Peaking Energy (mills/kWh) 1 .... 9.53 9.52 19.05 12.26 6.79 19.05 

1Firm Peaking Energy is normally returned. This charge will be assessed in the event firm peaking energy is not returned. 

By Delegation Order No. 00–037.00A, 

effective October 25, 2013, the Secretary 

of Energy delegated: (1) The authority to 

develop power and transmission rates to 

Western’s Administrator; (2) the 

authority to confirm, approve, and place 

such rates into effect on an interim basis 

to the Deputy Secretary of Energy; and 

(3) the authority to confirm, approve, 

and place into effect on a final basis, to 

remand or to disapprove such rates to 

FERC. Existing DOE procedures for 

public participation in power rate 

adjustments (10 CFR part 903) were 

published on September 18, 1985. 

Under Delegation Order Nos. 00– 

037.00A and 00–001.00E and in 

compliance with 10 CFR part 903 and 

18 CFR part 300, I hereby confirm, 

approve, and place Rate Order No. 

WAPA–166, P–SMBP—ED firm power 

and firm peaking power rates, into effect 

on an interim basis 

(Provisional Rates). The new Rate 

Schedules P–SED–F12 and P–SED–FP12 

will be promptly submitted to FERC for 

confirmation and approval on a final 

basis. 

Dated: December 2, 2014. 

Elizabeth Sherwood-Randall, 

Deputy Secretary of Energy. 

DEPARTMENT OF ENERGY 

DEPUTY SECRETARY 

In the matter of: 

Western Area Power Administration 

Rate Adjustment for the Pick-Sloan 

Missouri Basin Program—Eastern 

Division 

Rate Order No. WAPA–166 

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Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 72671 

ORDER CONFIRMING, APPROVING, 

AND PLACING THE PICK-SLOAN 

MISSOURI BASIN PROGRAM— 

EASTERN DIVISION FIRM POWER 

AND FIRM PEAKING POWER SERVICE 

RATES INTO EFFECT ON AN INTERIM 

BASIS 

These firm and firm peaking power 

service rates for the Pick-Sloan Missouri 

Basin Program—Eastern Division (P– 

SMBP—ED) are established in 

accordance with section 302 of the 

Department of Energy (DOE) 

Organization Act (42 U.S.C. 7152). This 

Act transferred to and vested in the 

Secretary of Energy the power marketing 

functions of the Secretary of the 

Department of the Interior and the 

Bureau of Reclamation under the 

Reclamation Act of 1902 (ch. 1093, 32 

Stat. 388), as amended and 

supplemented by subsequent laws, 

particularly section 9(c) of the 

Reclamation Project Act of 1939 (43 

U.S.C. 485h(c)) and section 5 of the 

Flood Control Act of 1944 (16 U.S.C. 

825s), and other acts that specifically 

apply to the project involved. 

By Delegation Order No. 00–037.00A, 

effective October 25, 2013, the Secretary 

of Energy delegated: (1) the authority to 

develop power and transmission rates to 

the Administrator of Western Area 

Power Administration (Western); (2) the 

authority to confirm, approve, and place 

such rates into effect on an interim basis 

to the Deputy Secretary of Energy; and 

(3) the authority to confirm, approve, 

and place into effect on a final basis, to 

remand, or to disapprove such rates to 

the Federal Energy Regulatory 

Commission (FERC). Existing DOE 

procedures for public participation in 

power rate adjustments (10 CFR part 

903) were published on September 18, 

1985. 

Acronyms and Definitions 

As used in this Rate Order, the 

following acronyms and definitions 

apply: 

Base ............................................ A fixed revenue requirement that includes operation and maintenance expense, investments and replacements, interest on investments and replacements, normal timing purchase power (purchases due to 

operational constraints, not associated with drought), and transmission costs. 

Capacity ..................................... The electric capability of a generator, transformer, transmission circuit, or other equipment. It is expressed in kilowatts. 

Capacity Charge ........................ The charge under the rate schedule for capacity. It is expressed in dollars per kilowattmonth. 

Composite Rate ......................... The Power Repayment Study (PRS) rate for commercial firm power, which is the total annual revenue requirement for capacity and energy divided by the total annual energy sales. It is expressed in mills per 

kilowatthour and used for comparison purposes. 

CROD ......................................... Contract Rate of Delivery. The maximum amount of capacity and energy allocated to a Preference Customer for a period specified under a contract. 

Deficits ....................................... Deferred or unrecovered annual and/or interest expenses. 

DOE Order RA 6120.2 ............... An order outlining power marketing administration financial reporting and rate-making procedures. 

Drought Adder ........................... A formula-based revenue requirement that includes future purchase power above timing purchases, previous purchase power drought deficits, and interest on the purchase power drought deficits. 

Energy ........................................ Measured in terms of the work it is capable of doing over a period of time. Energy is expressed in 

kilowatthours. 

Energy Charge ........................... The charge under the rate schedule for energy. It is expressed in mills per kilowatthour and applied to 

each kilowatthour delivered to each customer. 

Firm ............................................ A type of product and/or service available at the time requested by the customer. 

FY ............................................... Fiscal year; October 1 to September 30. 

kW .............................................. Kilowatt—the electrical unit of capacity that equals 1,000 watts. 

kWh ............................................ Kilowatthour—the electrical unit of energy that equals 1,000 watts in 1 hour. 

kWmonth ................................... Kilowattmonth—the electrical unit of the monthly amount of capacity. 

mills/kWh .................................. Mills per kilowatthour—the unit of charge for energy (equal to one tenth of a cent or one thousandth of a 

dollar). 

MW ............................................. Megawatt—the electrical unit of capacity that equals 1 million watts or 1,000 kilowatts. 

Non-timing Power Purchases ... Power purchases that are not related to operational constraints such as management of endangered species, species habitat, water quality, navigation, control area purposes, etc. 

O&M ........................................... Operation and Maintenance. 

Power ......................................... Capacity and energy. 

Power Factor .............................. The ratio of real to apparent power at any given point and time in an electrical circuit. Generally, it is expressed as a percentage. 

Preference .................................. The provisions of Reclamation Law that require Western to first make Federal power available to certain 

entities. For example, section 9(c) of the Reclamation Project Act of 1939 (43 U.S.C. 485h(c)) states that 

preference in the sale of Federal power shall be given to municipalities and other public corporations 

or agencies and also to cooperatives and other nonprofit organizations financed in whole or in part by 

loans made under the Rural Electrification Act of 1936. 

Provisional Rate ........................ A rate that has been confirmed, approved, and placed into effect on an interim basis by the Deputy Secretary of Energy. 

Revenue Requirement ............... The revenue required by PRS to recover annual expenses (such as O&M, purchase power, transmission 

service expenses, interest, and deferred expenses) and repay Federal investments and other assigned 

costs. 

Effective Date 

The Provisional Rates will take effect 

on the first day of the first full billing 

period beginning on or after January 1, 

2015, and will remain in effect until 

December 31, 2019, pending approval 

by FERC on a final basis. 

Public Notice and Comment 

Western followed the Procedures for 

Public Participation in Power and 

Transmission Rate Adjustments and 

Extensions, 10 CFR part 903, in 

developing these rates. The steps 

Western took to involve interested 

parties in the minor rate process were: 

1. On April 17, 2014, Western mailed 

a notice announcing an informal public 

meeting would be held via webinar on 

May 2, 2014, to discuss the rate process 

for the expiring firm power rates for the 

P–SMBP—ED. The focus of the webinar 

was to provide an update on the FY 

2013 PRS, discuss the Base and Drought 

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72672 Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 

Adder component true up, and plan for 

the upcoming rate adjustment process. 

2. A Federal Register notice (FRN), 

published on August 8, 2014 (79 FR 

46434), announced the proposed rates 

for P–SMBP—ED and began the 30-day 

public consultation and comment 

period. 

3. On August 8, 2014, Western mailed 

letters to all P–SMBP—ED Preference 

Customers and interested parties 

transmitting the FRN published on 

August 8, 2014. 

4. Western provided a Web page that 

contains all dates, customer letters, 

presentations, the FRN, and all other 

information about this rate process. The 

Web page is located at http://www.

wapa.gov/ugp/rates/2015FirmRate

Adjust. 

5. During the consultation and 

comment period, which ended 

September 8, 2014, Western received 

three comment letters. All formally 

submitted comments have been 

considered in the preparation of this 

Rate Order. 

Comments 

Written comments were received 

from the following interested parties: 

Mid-West Electric Consumers 

Association 

Missouri River Energy Services 

Rodger Otstot 

Project Description 

The Pick-Sloan Missouri Basin 

Program (P–SMBP), originally the 

Missouri River Basin Project, was 

authorized by Congress in the Flood 

Control Act of 1944. The multipurpose 

program provides authorization for 

construction of certain public works and 

improvements on rivers and harbors for 

flood control, generation of hydropower, 

resources for water supply and 

irrigation, aids to navigation, 

preservation of water quality, 

enhancement of fish and wildlife, and 

creation of recreation opportunities. 

In addition to the multipurpose water 

projects authorized by Section 9 of the 

Flood Control Act of 1944, certain other 

existing projects have been integrated 

with the P–SMBP for power marketing, 

operation, and repayment purposes. The 

Colorado-Big Thompson, Kendrick, and 

Shoshone Projects were combined with 

the P–SMBP in 1954, followed by the 

North Platte Project in 1959. These 

projects were referred to as the 

‘‘Integrated Projects’’ of the P–SMBP. 

The Flood Control Act of 1944 also 

authorized the inclusion of the Fort 

Peck Project with the P–SMBP for 

operation and repayment purposes. 

P–SMBP power is marketed by two 

Western regions. The Upper Great 

Plains Region (UGPR) markets the 

Eastern Division (P–SMBP—ED) and the 

Rocky Mountain Region (RMR) markets 

the Western Division (P–SMBP—WD) 

through the Loveland Area Projects 

(LAP). The P–SMBP power is marketed 

to approximately 360 firm power 

customers by UGPR and approximately 

53 firm power customers by RMR. 

Power Repayment Study—Firm Power 

Rate 

Western prepares a PRS each FY to 

determine if revenues will be sufficient 

to repay, within the required time, all 

costs assigned to the P–SMBP. 

Repayment criteria are based on 

Western’s applicable laws and 

legislation, as well as policies including 

DOE Order RA 6120.2. To meet Cost 

Recovery Criteria outlined in DOE Order 

RA 6120.2, a revised study and rate 

adjustment has been developed to 

demonstrate that sufficient revenues 

will be collected under Provisional 

Rates to meet future obligations. The 

PRS revenue requirement and 

Composite Rate remains unchanged, as 

indicated in Table 1: 

TABLE 1—COMPARISON OF P–SMBP—ED REVENUE REQUIREMENT AND COMPOSITE RATE

Existing 

Requirements 

(January 1, 2010) 

Provisional 

Requirements 

(January 1, 2015) 

Percent 

Change 

P–SMBP—ED Revenue Requirement ($ in millions) ...................................... $320 .2 $320 .2 0 

P–SMBP—ED Composite Rate (mills/kWh) .................................................... 33 .25 33 .25 0 

The P–SMBP—ED annual revenue 

requirement equals $332.8 million and 

is comprised of a Base revenue 

requirement, less a 5 percent discount 

for facility credits, resulting in a total 

revenue requirement of $320.2 million. 

Existing and Provisional Rates 

P–SMBP—ED 

Under Rate Schedule P–SED–F12, the 

firm capacity charge remains $7.65/

kWmonth and the firm energy charge 

remains 19.05 mills/kWh. Under Rate 

Schedule P–SED–FP12, the firm peaking 

capacity charge remains $6.90/

kWmonth. Firm Peaking Energy is 

normally returned. A Firm Peaking 

Energy charge of 19.05 mills/kWh will 

be assessed in the event energy is not 

returned. These Rate Schedules are 

formula based to provide for an annual 

adjustment to the Drought Adder 

component. An incremental upward 

adjustment to the Drought Adder greater 

than the equivalent of 2 mills/kWh to 

the PRS Composite Rate will require a 

public process. The Drought Adder may 

be adjusted downward pursuant to the 

formula without a public process. The 

overall capacity and energy charges are 

not changing, as indicated in the 

following Table 2: 

TABLE 2—COMPARISON OF EXISTING AND PROVISIONAL P–SMBP—ED FIRM POWER RATES

Firm power service 

Existing Charges 

Under 

Rate Schedules Effective 

(January 1, 2010) 

P–SED–F11/ 

P–SED–FP11 

Provisional Charges 

Under Rate Schedules 

Effective 

(January 1, 2015) 

P–SED–F12/ 

P–SED–FP12 

Percent 

Change 

Firm Capacity ($/kWmonth) ............................................................................. $7 .65 $7 .65 0 

Firm Energy (mills/kWh) .................................................................................. 19 .05 19 .05 0 

Firm Peaking Capacity ($/kWmonth) ............................................................... $6 .90 $6 .90 0 

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Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 72673 

TABLE 2—COMPARISON OF EXISTING AND PROVISIONAL P–SMBP—ED FIRM POWER RATES—Continued 

Firm power service 

Existing Charges 

Under 

Rate Schedules Effective 

(January 1, 2010) 

P–SED–F11/ 

P–SED–FP11 

Provisional Charges 

Under Rate Schedules 

Effective 

(January 1, 2015) 

P–SED–F12/ 

P–SED–FP12 

Percent 

Change 

Firm Peaking Energy (mills/kWh) 1 .................................................................. 19 .05 19 .05 0 

1Firm Peaking Energy is normally returned. This charge will be assessed in the event Firm Peaking Energy is not returned. 

Under the current rate methodology, 

rates for P–SMBP—ED firm power and 

firm peaking power service are designed 

to recover an annual revenue 

requirement that includes investment 

repayment, interest, purchase power, 

O&M, and other expenses within the 

allowable period. 

Western is trueing up the Base and 

Drought Adder components of the rate 

schedules and placing new rate 

schedules into effect for the 5-year 

period, beginning January 1, 2015, 

through December 31, 2019. The true-up 

updates the Base components to 

represent present costs and lowers the 

Drought Adder components to represent 

present drought costs. Over the past 5- 

year rate period, the P–SMBP costs 

included in the Drought Adder have 

decreased as the actual deficits were 

less than the projected deficits. 

Additionally, there have been drought 

costs repaid ahead of schedule, which 

decreased the drought deficit interest 

expense. Base costs increased during 

that same period due to a new 5-year 

cost evaluation period, new investments 

and replacements, and inflationary 

costs. 

P–SMBP—WD 

The P–SMBP—WD revenue 

requirement is incorporated into the 

LAP rate, along with the revenue 

requirement for the Fryingpan-Arkansas 

Project. The adjustment to the LAP rate 

is a separate formal rate process, which 

is documented in Rate Order No. 

WAPA–167. Rate Order No. WAPA–167 

is also scheduled to go into effect on the 

first day of the first full billing period 

on or after January 1, 2015. 

Certification of Rates 

Western’s Administrator certified that 

the firm power and firm peaking power 

rates under Rate Schedules P–SED–F12 

and P–SED–FP12 are the lowest 

possible rates consistent with sound 

business principles. The rates were 

developed following administrative 

policies and applicable laws. 

P–SMBP—ED Firm Power Rate 

Discussion 

Western is required to establish power 

rates sufficient to recover O&M, 

purchased power and interest expenses, 

and repay power investment and 

irrigation aid. The P–SMBP—ED firm 

power and firm peaking power Base and 

Drought Adder components are updated 

to represent present costs. Under Rate 

Schedule P–SED–F12, Western will 

continue identifying its firm power 

service revenue requirement using Base 

and Drought Adder components. The 

Base component is a fixed revenue 

requirement that includes annual O&M 

expenses, investment repayment and 

associated interest, normal timing 

power purchases, and transmission 

costs. Western’s normal timing power 

purchases are due to operational 

constraints (e.g., management of 

endangered species habitat, water 

quality, navigation, etc.) and are not 

associated with drought. The Base 

component cannot be adjusted by 

Western without a public process. 

The Drought Adder component is a 

formula-based revenue requirement that 

includes costs attributable to drought 

conditions within P–SMBP. The 

Drought Adder component includes 

costs associated with future Non-timing 

Power Purchases to meet firm power 

contractual obligations not covered with 

available system generation due to a 

drought, previously incurred deficits 

due to purchased power debt that 

resulted from Non-timing Power 

Purchases made during a drought, and 

the interest associated with drought 

debt. The Drought Adder component is 

designed to repay Western’s drought 

debt within 10 years from the time the 

debt was incurred, using balloonpayment methodology. For example, the 

drought debt incurred by Western in FY 

2009 will be repaid by FY 2019. 

The annual revenue requirement 

calculation will continue to be 

summarized by the following formula: 

Annual Revenue Requirement = Base 

Revenue Requirement + Drought Adder 

Revenue Requirement. Both the Base 

and Drought Adder components recover 

portions of the firm power revenue 

requirement, firm peaking power, and 

associated 5 percent discount revenue 

necessary to equal the P–SMBP—ED 

revenue requirement. A comparison of 

the existing and provisional charge 

components is listed in Table 3. 

TABLE 3—SUMMARY OF P–SMBP—ED RATE COMPONENTS

Firm Power Service 

Existing Charges Under Rate Schedules 

Effective 

(January 1, 2010) 

P–SED–F11/ 

P–SED–FP11 

Provisional Charges Under Rate Schedules 

Effective 

(January 1, 2015) 

P–SED–F12/ 

P–SED–FP12 

Base 

Component 

Drought Adder 

Component Total Charge Base Component 

Drought Adder 

Component Total Charge 

Firm Capacity ($/kWmonth) ..................... $3.80 $3.85 $7.65 $4.90 $2.75 $7.65 

Firm Energy (mills/kWh) .......................... 9.53 9.52 19.05 12.33 6.72 19.05 

Firm Peaking Capacity ($/kWmonth) ....... $3.45 $3.45 $6.90 $4.45 $2.45 $6.90 

Firm Peaking Energy (mills/kWh) 1 .......... 9.53 9.52 19.05 12.26 6.79 19.05 

1Firm Peaking Energy is normally returned. This charge will be assessed in the event Firm Peaking Energy is not returned. 

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72674 Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 

Continuing to identify the firm 

electric service revenue requirement 

using Base and Drought Adder 

components will assist Western in 

presenting the effects of the drought 

within P–SMBP, demonstrating 

repayment of the drought-related costs, 

and allow Western to be more 

responsive to changes in drought-related 

expenses. Western will continue to 

charge and bill Customers firm power 

service charges for energy and capacity, 

which are the sum of the Base and 

Drought Adder components. 

Western reviews its firm electric 

service rates annually. Western will 

review the Base component after the 

annual PRS is completed, generally in 

the first quarter of the calendar year. If 

an adjustment to the Base component is 

necessary, Western will initiate a public 

process following 10 CFR part 903 

before making an adjustment. 

In accordance with the original 

implementation of the Drought Adder 

component, Western will review the 

Drought Adder component each 

September to determine if drought costs 

differ from those projected in the PRS. 

If drought costs differ, Western will 

determine if an adjustment to the 

Drought Adder component is necessary. 

Western will notify customers by letter 

each October of the planned 

incremental or decremental adjustment 

and implement the adjustment in the 

January billing cycle. Although 

decremental adjustments to the Drought 

Adder component will occur as drought 

costs are repaid, the adjustments cannot 

result in a negative Drought Adder 

component. To give customers advance 

notice, Western will conduct a 

preliminary review of the Drought 

Adder component in early summer and 

notify customers by letter of the 

estimated change to the Drought Adder 

component for the following January. 

Western will verify the final Drought 

Adder component adjustment and 

notify customers by letter each October 

of any planned increase or decrease in 

this component. Implementing the 

Drought Adder component adjustment 

on January 1 of each year will help keep 

the drought deficits from escalating as 

quickly, will lower the interest expense 

due to drought deficits, will 

demonstrate responsible deficit 

management, and will provide prompt 

drought deficit repayments. 

Western’s current and provisional rate 

schedules are formula based to provide 

for an annual adjustment to the Drought 

Adder component. An incremental 

upward adjustment to the Drought 

Adder greater than the equivalent of 2 

mills/kWh to the PRS Composite Rate 

will require a public process. The 

Drought Adder may be adjusted 

downward pursuant to the formula 

without a public process. 

Statement of Revenue and Related 

Expenses 

The following Table 4 provides a 

summary of projected revenue and 

expense data for the total P–SMBP, 

including both the Eastern and Western 

Division’s firm electric service revenue 

requirements through the 5-year rate 

approval period. The firm power rates 

for both divisions have been developed 

with the following revenues and 

expenses for the P–SMBP: 

TABLE 4—TOTAL P–SMBP FIRM POWER COMPARISON OF 5-YEAR RATE PERIOD (FY 2015–2019) TOTAL REVENUES AND

EXPENSES

Existing Rate 

($000) 

Provisional Rate 

($000) 

Difference 

($000) 

Total Revenues .................................................................................................... $2,625,336 $2,679,973 $54,637 

Revenue Distribution 

Expenses: 

O&M .............................................................................................................. $904,884 $1,082,969 $178,085 

Purchased Power ......................................................................................... 440,038 164,049 (275,989) 

Interest .......................................................................................................... 650,671 561,528 (89,143) 

Transmission ................................................................................................ 65,853 64,072 (1,781) 

Total Expenses ...................................................................................... $2,061,446 $1,872,618 $(188,828) 

Principal Payments: 

Capitalized Expenses (Deficits) 1 ................................................................. $483,252 $345,006 $(138,246) 

Original Project and Additions 1 .................................................................... 10,414 401,193 390,779 

Replacements 1 ............................................................................................. 4,825 61,156 56,331 

Irrigation Aid ................................................................................................. 65,399 0 (65,399) 

Total Principal Payments ...................................................................... $563,890 $807,355 $243,465 

Total Revenue Distribution .................................................................... $2,625,336 $2,679,973 $54,637 

1 Due to deficit conditions between 2001 and 2009, revenues generated in the cost evaluation period are applied toward repayment of deficits 

rather than repayment of project additions and replacements. All deficits are projected to be repaid by 2018. 

Basis for Rate Development 

The existing charges for firm power 

and firm peaking power under Rate 

Schedules F11 and FP11, which expire 

December 31, 2014, continue to provide 

sufficient revenue to meet the P– 

SMBP—ED repayment obligations. The 

total annual revenue requirement for 

P–SMBP—ED remains $320.2 million 

for firm power and firm peaking power 

service, and the overall capacity and 

energy charges are not changing. The 

Provisional Rates, under Rate Schedules 

F12 and FP12, will take effect on the 

first full billing period on or after 

January 1, 2015, and will remain in 

effect on an interim basis, pending 

FERC’s confirmation and approval of 

the rate schedules or substitute rates on 

a final basis, through December 31, 

2019, or until the rate schedules are 

superseded. 

Comments 

Western received three comment 

letters during the public consultation 

and comment period. The comments 

expressed in these letters have been 

paraphrased, where appropriate, 

without compromising the meaning of 

the comments. 

A. Comment: Two customer 

representatives recognized the need for 

true up of the Base and Drought Adder 

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Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 72675 

charge components of the composite 

rate. 

Response: Western agrees with the 

above comment. Rather than extend 

rates with out-of-date charge 

components, Western choose to do a 

minor rate adjustment to address trueing 

up the charge components. 

B. Comment: One customer 

representative supported the rate 

modifications as proposed, and 

emphasized the need for continued cost 

control regarding the Base component. 

They stated the Base costs cannot grow 

unabated and replace the shrinking 

Drought Adder. The customer stressed 

that cost control is of paramount 

importance. 

Response: Western agrees with the 

above comment. Western is committed 

to keeping the power rates at the lowest 

possible rates while maintain sound 

business principles. All budgeted O&M 

and capital improvements are vetted 

annually through customer work plan 

meetings to access the impacts to the 

rates. 

C. Comment: One interested party 

expressed concern over the 

suballocation of the power allocation for 

the Pick-Sloan Missouri Basin Program. 

The customer feels the allocation is not 

being calculated in agreement with the 

ultimate development concept or in 

accordance with the repayment rules set 

forth in the Report of Financial Position, 

Missouri River Basin Project, dated 

December 1963. 

Response: Compliance with applicable 

authority regarding suballocations for 

the Pick-Sloan Missouri Basin Program 

is beyond the scope of this minor rate 

adjustment process and public process. 

Western is in compliance with 

applicable authority. Moreover, any 

change in the cost allocations would 

require Congressional approval 

pursuant to the DOE Organization Act of 

1977 (42 U.S.C. 7152(a)(3)). 

Availability of Information 

All documents related to this action 

are available for inspection and copying 

at the Upper Great Plains Regional 

Office, located at 2900 4th Avenue 

North, Billings, Montana. These 

documents are also available on 

Western’s Web site located at http:// 

www.wapa.gov/ugp/rates/ 

2015firmrateadjust. 

Ratemaking Procedure Requirements: 

Environmental Compliance 

In compliance with the National 

Environmental Policy Act (NEPA) of 

1969 (42 U.S.C. 4321–4347), the Council 

on Environmental Quality Regulations 

for implementing NEPA (40 CFR parts 

1500–1508), and DOE NEPA 

Implementing Procedures and 

Guidelines (10 CFR part 1021), Western 

has determined this action is 

categorically excluded from preparing 

an environmental assessment or an 

environmental impact statement. 

Determination Under Executive Order 

12866 

Western has an exemption from 

centralized regulatory review under 

Executive Order 12866; accordingly, no 

clearance of this notice by the Office of 

Management and Budget is required. 

Submission to the Federal Energy 

Regulatory Commission 

The Provisional Rates herein 

confirmed, approved, and placed into 

effect on an interim basis, together with 

supporting documents, will be 

submitted to FERC for confirmation and 

final approval. 

ORDER 

In view of the foregoing and under the 

authority delegated to me, I confirm and 

approve on an interim basis, effective on 

the first full billing period on or after 

January 1, 2015, Rate Schedules P–SED– 

F12 and P–SED–FP12 for the Pick-Sloan 

Missouri Basin Program—Eastern 

Division Project of the Western Area 

Power Administration. These rate 

schedules shall remain in effect on an 

interim basis, pending FERC’s 

confirmation and approval of the rate 

schedules or substitute rates on a final 

basis through December 31, 2019, or 

until the rate schedules are superseded. 

Dated: December 2, 2014. 

Elizabeth Sherwood-Randall, 

Deputy Secretary of Energy. 

Rate Schedule P–SED–F12 

(Supersedes Schedule P–SED–F11) 

January 1, 2015 

United States Department of Energy 

Western Area Power Administration 

Pick–Sloan Missouri Basin Program— 

Eastern Division 

Montana, North Dakota, South Dakota, 

Minnesota, Iowa, Nebraska 

SCHEDULE OF RATES FOR FIRM 

POWER SERVICE 

(Approved Under Rate Order No. 

WAPA–166) 

Effective: 

The first day of the first full billing 

period beginning on or after January 1, 

2015, through December 31, 2019, or 

until superseded by another rate 

schedule. 

Available: 

Within the marketing area served by 

the Eastern Division of the Pick-Sloan 

Missouri Basin Program. 

Applicable: 

To the power and energy delivered to 

customers as firm power service. 

Character: 

Alternating current, 60 hertz, three 

phase, delivered and metered at the 

voltages and points established by 

contract. 

Formula Rate and Charge Components: 

Rate = Base component + Drought 

Adder component 

Monthly Charge as of January 1, 2015, 

under the Rate: 

CAPACITY CHARGE: 

$7.65 for each kilowatt per month 

(kWmonth) of billing capacity. 

ENERGY CHARGE: 

19.05 mills for each kilowatthour 

(kWh) for all energy delivered as firm 

power service. 

BILLING CAPACITY: The billing 

capacity will be as defined by the power 

sales contract. 

Base: A fixed revenue requirement 

that includes operation and 

maintenance expense, investments and 

replacements, interest on investments 

and replacements, normal timing 

purchase power (purchases due to 

operational constraints, not associated 

with drought), and transmission costs. 

The Base component charges are fixed 

amounts under this Rate Schedule, 

determined as follows: 

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72676 Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 

Process: 

Any proposed change to the Base 

component will require a public 

process. 

The Drought Adder may be adjusted 

annually using the above formulas for 

any costs attributed to drought of less 

than or equal to the equivalent of 2 

mills/kWh to the Power Repayment 

Study (PRS) composite rate. Any 

planned incremental upward 

adjustment to the Drought Adder greater 

than the equivalent of 2 mills/kWh to 

the PRS composite rate will require a 

public process. The Drought Adder may 

be adjusted downward pursuant to the 

formulas without a public process. 

A revised Drought Adder charge may 

go into effect January 1 of each year 

based on the formula above. Western 

will notify customers annually in 

October of the revised monthly charges. 

Any change to the Drought Adder 

component will be identified in a 

revision to charges under this rate 

schedule. 

Adjustments: 

For Character and Conditions of 

Service: 

Customers who receive deliveries at 

transmission voltage may, in some 

instances, be eligible to receive a 5 

percent discount on capacity and energy 

charges when facilities are provided by 

the customer that results in a sufficient 

savings to Western to justify the 

discount. The determination of 

eligibility for receipt of the voltage 

discount shall be exclusively vested in 

Western. 

For Billing of Unauthorized Overruns: 

For each billing period in which there 

is a contract violation involving an 

unauthorized overrun of the contractual 

firm power and/or energy obligations, 

such overrun shall be billed at 10 times 

the formula rate. 

For Power Factor: 

None. Customers will be required to 

maintain a power factor at the point of 

delivery between 95-percent lagging and 

95-percent leading. 

Rate Schedule P–SED–FP12 

(Supersedes Schedule P–SED–FP11) 

January 1, 2015 

United States Department of Energy 

Western Area Power Administration 

Pick-Sloan Missouri Basin Program— 

Eastern Division Montana, North 

Dakota, South Dakota, Minnesota, 

Iowa, Nebraska 

SCHEDULE OF RATES FOR FIRM 

PEAKING POWER SERVICE 

(Approved Under Rate Order No. 

WAPA–166) 

Effective: 

The first day of the first full billing 

period beginning on or after January 1, 

2015, through December 31, 2019, or 

until superseded by another rate 

schedule. 

Available: 

Within the marketing area served by 

the Eastern Division of the Pick-Sloan 

Missouri Basin Program, to customers 

with generating resources, enabling 

them to use firm peaking power service. 

Applicable: 

To the power sold to customers as 

firm peaking power service. 

Character: 

Alternating current, 60 hertz, three 

phase, delivered and metered at the 

voltages and points established by 

contract. 

Formula Rate and Charge Components: 

Rate = Base component + Drought 

Adder component 

Monthly Charge as of January 1, 2015, 

under the Rate: 

CAPACITY CHARGE: 

$6.90 for each kilowatt per month 

(kWmonth) of the effective contract rate 

of delivery for peaking power or the 

maximum amount scheduled, 

whichever is greater. 

ENERGY CHARGE: 

19.05 mills for each kilowatthour 

(kWh) for all energy scheduled for 

delivery without return. 

Base: A fixed revenue requirement 

that includes operation and 

maintenance expense, investments and 

replacements, interest on investments 

and replacements, normal timing 

purchase power (purchases due to 

operational constraints, not associated 

with drought), and transmission costs. 

The Base component charges are fixed 

amounts under this Rate Schedule, 

determined as follows: 


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Federal Register / Vol. 79, No. 235 / Monday, December 8, 2014 / Notices 72677 

1The Final EIS can be found on the RUS Web site 

at: http://www.rurdev.usda.gov/UWP-AVSNeset.html. 

Process: 

Any proposed change to the Base 

component will require a public 

process. 

The Drought Adder may be adjusted 

annually using the above formulas for 

any costs attributed to drought of less 

than or equal to the equivalent of 2 

mills/kWh to the Power Repayment 

Study (PRS) composite rate. Any 

planned incremental upward 

adjustment to the Drought Adder greater 

than the equivalent of 2 mills/kWh to 

the PRS composite rate will require a 

public process. The Drought Adder may 

be adjusted downward pursuant to the 

formulas without a public process. 

A revised Drought Adder charge may 

go into effect January 1 of each year 

based on the formula above. Western 

will notify customers annually in 

October of the revised monthly charges. 

Any change to the Drought Adder 

component will be identified in a 

revision to charges under this rate 

schedule. 

BILLING CAPACITY: 

The billing capacity will be the 

greater of (1) the highest 30-minute 

integrated capacity measured during the 

month up to, but not in excess of, the 

delivery obligation under the power 

sales contract, or (2) the contract rate of 

delivery. 

Adjustments: 

Billing for Unauthorized Overruns: 

For each billing period in which there 

is a contract violation involving an 

unauthorized overrun of the contractual 

obligation for peaking capacity and/or 

energy, such overrun shall be billed at 

10 times the formula rate. 

[FR Doc. 2014–28677 Filed 12–5–14; 8:45 am] 

BILLING CODE 6450–01–P 

DEPARTMENT OF ENERGY 

Western Area Power Administration 

Antelope Valley Station to Neset 

Transmission Project Record of 

Decision (DOE/EIS–0478) 

AGENCY: Western Area Power 

Administration, DOE. 

ACTION: Record of Decision. 

SUMMARY: Western Area Power 

Administration (Western), an agency 

within the U.S. Department of Energy 

(DOE), received a request from Basin 

Electric Power Cooperative (Basin 

Electric) to interconnect its proposed 

Antelope Valley Station (AVS) to Neset 

Transmission Project (Project) to 

Western’s Williston Substation and 

Williston to Charlie Creek 230-kilovolt 

(kV) transmission line. The Project 

would be located in northwest North 

Dakota including parts of Mercer, Dunn, 

McKenzie, Williams, and Mountrail 

counties. On May 30, 2014, the Notice 

of Availability (NOA) of the Final 

Environmental Impact Statement (EIS) 

for the Project was published in the 

Federal Register (79 FR 31085). The 

U.S. Department of Agriculture (USDA), 

Rural Utilities Service (RUS) was the 

lead Federal agency for the EIS. Western 

was a cooperating agency in preparation 

of the EIS. After considering the 

environmental impacts, Western has 

decided to allow Basin Electric’s request 

for interconnection. 

FOR FURTHER INFORMATION CONTACT: For 

further information, please contact Mr. 

Rod O’Sullivan, Corporate Services 

Office, Western Area Power 

Administration, A7400, P.O. Box 

281213, Lakewood, CO 80228–8213, 

telephone (720) 962–7260 or email: 

OSullivan@wapa.gov. For general 

information on DOE’s National 

Environmental Policy Act of 1969 

(NEPA) review process, please contact 

Carol M. Borgstrom, Director, Office of 

NEPA Policy and Compliance, GC–54, 

U.S. Department of Energy, Washington, 

DC 20585, telephone (202) 586–4600 or 

(800) 472–2756. 

SUPPLEMENTARY INFORMATION: Western is 

a Federal agency under the DOE that 

markets and transmits wholesale 

electrical power through an integrated 

17,000-circuit mile, high-voltage 

transmission system across 15 western 

states. Basin Electric’s request for 

interconnection was processed in 

accordance with Western’s General 

Requirements for Interconnection, 

which sets forth the procedures and 

requirements for certain types of 

interconnection to Western’s 

transmission system that are not 

provided for in Western’s Open Access 

Transmission Tariff (e.g., system-tosystem interconnections not associated 

with transmission or generator 

interconnection service). 

Interested parties were notified of the 

proposed Project and the public scoping 

comment opportunity through a Notice 

of Intent published in the Federal 

Register on November 2, 2011 (76 FR 

67670). The RUS published an NOA of 

the Draft EIS in the Federal Register on 

December 7, 2012 (77 FR 73029). On 

December 20, 2013, the U.S. 

Environmental Protection Agency (EPA) 

published an NOA of the Supplemental 

Draft EIS for the Project in the Federal 

Register (78 FR 77121). On May 30, 

2014, RUS published an NOA of the 

Final EIS for the Project in the Federal 

Register (79 FR 31085).1 The RUS 

published its NOA for its Record of 

Decision (ROD) on September 22, 2014, 

in the Federal Register (79 FR 56557). 

With the issuance of its ROD, RUS 

selected Alternative C as the 

transmission line route. 

The RUS was the lead Federal agency 

for the EIS. Western and the USDA, 

Forest Service (USFS) participated as 

cooperating agencies on the EIS. After 

an independent review of the Final EIS, 

Western has concluded that its needs 


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