[Federal Register Volume 79, Number 243 (Thursday, December 18, 2014)]
[Notices]
[Pages 75544-75550]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-29638]


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DEPARTMENT OF ENERGY

Western Area Power Administration


Boulder Canyon Project--Post-2017 Resource Pool

AGENCY: Western Area Power Administration, DOE.

ACTION: Notice of final power allocation.

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SUMMARY: The Western Area Power Administration (Western), a Federal 
power marketing agency of the Department of Energy (DOE), announces the 
Boulder Canyon Project (BCP) Post-2017 Resource Pool Final Allocation 
of Power (BCP Final Allocation). The BCP Final Allocation was developed 
pursuant to the Conformed Power Marketing Criteria or Regulations for 
the Boulder Canyon Project (2012 Conformed Criteria) published in the 
Federal Register on June 14, 2012, as required by the Hoover Power 
Allocation Act of 2011, and Western's final BCP post-2017 marketing 
criteria and call for applications published in the Federal Register on 
December 30, 2013. This notice also includes Western's responses to 
comments on proposed allocations published on August 8, 2014. The BCP 
Final Allocation documents Western's decisions prior to beginning the 
contractual phase of the process. Electric service contracts will 
provide for delivery from October 1, 2017 to September 30, 2067.

DATES: The BCP Final Allocation will become effective December 19, 
2014.

ADDRESSES: Information regarding the BCP Final Allocation including 
comments, letters, and other supporting documents is available for 
public inspection and copying at the Desert Southwest Customer Service 
Region, Western Area Power Administration, 615 South 43rd Avenue, 
Phoenix, AZ 85009. Public comments and related information may be 
accessed at http://www.wapa.gov/dsw/pwrmkt/BCP_Remarketing/BCP_Remarketing.htm.

FOR FURTHER INFORMATION CONTACT: Mr. Mike Simonton, Public Utilities 
Specialist, Desert Southwest Customer Service Region, Western Area 
Power Administration, P.O. Box 6457, Phoenix, AZ 85005-6457, telephone 
number (602) 605-2675, email <a href="/cdn-cgi/l/email-protection#02526d71763032333540415242756372632c656d74"><span class="__cf_email__" data-cfemail="cb9ba4b8bff9fbfafc89889b8bbcaabbaae5aca4bd">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: The BCP was authorized by the Boulder Canyon 
Project Act of 1928 (43 U.S.C. 617) (BCPA). Under Section 5 of the 
BCPA, the Secretary of the Interior marketed the capacity and energy 
from the BCP under electric service contracts effective through May 31, 
1987. In 1977, the power marketing functions of the Secretary of the 
Interior were transferred to Western by Section 302 of the Department 
of Energy Organization Act (42 U.S.C. 7152) (DOE Act). On December 28, 
1984, Western published the Conformed General Consolidated Criteria or 
Regulations for Boulder City Area Projects (1984 Conformed Criteria) 
(49 FR 50582) to implement applicable provisions of the Hoover Power 
Plant Act of 1984 (43 U.S.C. 619) for the marketing of BCP power 
through September 30, 2017.
    On December 20, 2011, Congress enacted the Hoover Power Allocation 
Act of 2011 (43 U.S.C. 619a) (HPAA), which provides direction and 
guidance in marketing BCP power after the existing contracts expire on 
September 30, 2017. On June 14, 2012, Western published the 2012 
Conformed Criteria (77 FR 35671) to implement applicable provisions of 
the HPAA for the marketing of BCP power from October 1, 2017, through 
September 30, 2067. The 2012 Conformed Criteria formally established a 
resource pool defined as ``Schedule D'' to be allocated to new 
allottees. In accordance with the HPAA, Western allocated portions of 
Schedule D power to the Arizona Power Authority (APA) and the Colorado 
River Commission of Nevada (CRC), as described in the June 14, 2012 
Federal Register notice. Of the remaining Schedule D power, Western is 
to allocate 11,510 kilowatts (kW) of contingent capacity and associated 
firm energy to new allottees within the State of California and 69,170 
kW of contingent capacity and associated firm energy to new allottees 
within the Boulder City Area (BCA) marketing area as defined in the 
2012 Conformed Criteria.
    After conducting a public process and in consideration of comments 
received, Western published Final BCP Post-2017 Marketing Criteria 
(Marketing Criteria) and Call for Applications on December 30, 2013 (78 
FR 79436). Applications from those seeking an allocation of Schedule D 
power from Western were due on March 31, 2014. Western published the 
BCP Post-2017 Resource Pool Proposed Allocation of Power (BCP Proposed 
Allocation) in the Federal Register on August 8, 2014 (79 FR 46432). 
Public information and comment forums were held in Las Vegas, Nevada; 
Ontario, California; and Tempe, Arizona. Western received comments from 
existing power contractors, Native American tribes, cooperatives, 
municipals, and other potential contractors. Transcripts of the public 
forums, as well as comments received, may be viewed on Western's

[[Page 75545]]

Web site at http://www.wapa.gov/dsw/pwrmkt.
    The BCP Final Allocation was determined from the applications 
received during the call for applications in accordance with the 
guidelines of the 2012 Conformed Criteria and the Marketing Criteria.

Response to Comments on the BCP Proposed Allocation

    Western received numerous comments on its BCP Proposed Allocation 
during the comment period. Western reviewed and considered all comments 
received. This section summarizes and responds to the comments received 
on the BCP Proposed Allocation. The public comments below are 
paraphrased for brevity when not affecting the meaning of the 
statement(s).
    Comment: Several comments noted that Western's proposed allocations 
are consistent with the HPAA and the Marketing Criteria, which result 
in a reasonable distribution.
    Response: Western appreciates the support for its application of 
the Marketing Criteria resulting in reasonable allocation distributions 
that are consistent with the provisions of the HPAA.
    Comment: Several comments expressed appreciation and support for 
the proposed allocations. Western is acknowledged for administering a 
fair, expedient, and consistent process in the development of the 
proposed allocations. Final approval of the proposed allocations will 
enable allottees to achieve significant cost savings that will greatly 
benefit their communities, provide a widespread benefit of the BCP 
resource to new entities, and ensure allottees a stable, renewable, and 
environmentally friendly resource for the next 50 years.
    Response: Western appreciates the support and recognition of a 
fair, expedient, and consistent process administration. Western finds 
the BCP Final Allocation promotes widespread use principles that are in 
the public interest while navigating a multitude of competing 
interests.
    Comment: For Native American communities, access to low-cost power, 
such as BCP power, is a critical component to economic development and 
self-sufficiency programs. Western's ongoing recognition of tribal 
preference power status is therefore an extremely important 
contributor.
    Response: Western appreciates the support for its efforts related 
to tribes.
    Comment: Specific applicants requested a review of how their 
application was considered and potential allocation calculated. 
Corrections should be made in the event assumptions required 
adjustment.
    Response: Western provided descriptions and explanations of 
calculation methodologies at three public information forums and 
provided further detail in written responses to questions posed. For 
those that sought additional information, Western provided a more 
detailed summary of the calculations applicable to their application. 
In the process of reviewing Western's calculations and considerations, 
two corrections were made.
    In considering the Gila River Indian Community's (GRIC's) 
application, Western accounted for the direct allocation of Colorado 
River Storage Project (CRSP) power to GRIC and also erroneously 
included the same CRSP allocation as an indirect resource supplied by 
one of GRIC's host utilities, the Gila River Indian Community Utility 
Authority (GRICUA). When considering the application of the 
Metropolitan Domestic Water Improvement District (MDWID), the load 
distribution across MDWID's host utilities was incorrectly recorded, 
having an impact on the calculation of indirect benefits of Federal 
power.
    In the calculation of the final allocations, Western has removed 
the indirect benefits of GRIC's CRSP resource through the GRICUA host 
utility and corrected the load distribution of MDWID across its host 
utilities. These corrections altered not only the allocations of GRIC 
and MDWID, but other allottees as well.
    Comment: As private corporations, electric cooperatives fall within 
the defined class of beneficiaries set forth in Section 5 of the BCPA. 
The proposed allocations are within this legal predicate. As a 
consequence, Western should refrain from considering any comments that 
encourage revisiting the eligibility of cooperatives to receive power 
under Schedule D of the HPAA. The class of eligible entities as defined 
by the 2012 Conformed Criteria should remain consistent as Western 
develops the final allocations.
    Response: Comments concerning matters other than the BCP Proposed 
Allocation are outside the scope of this process. However, for clarity, 
Western agrees with the eligibility of cooperatives as determined in 
the development of the Marketing Criteria.
    Comment: At times, Western reduced the peak load of an applicant 
who is a host utility upon receiving an application from potential 
recipients within that host utility's service territory. Some 
applicants within these host utility service areas were not selected 
for a proposed allocation. For the sake of developing a fair and 
equitable calculation that relies on an accurate depiction of peak 
load, Western should recalculate the host utility's peak load used for 
calculating their proposed allocation by adding back those loads of 
unsuccessful applicants that Western subtracted from the host utility's 
peak load calculations. Failure to do so will result in a 
discriminatory allocation process that denies electric ratepayers' 
access to the Hoover resources that they are otherwise eligible to 
receive. Allocations should be re-calculated after these peak load 
adjustments have been made. These adjustments are particularly 
important in instances where the applicant within the host utility's 
service area was not eligible under the 2012 Conformed Criteria. In 
those circumstances, Western has decreased the host utility's load 
profile without justification that can be sustained. If Western is 
unable to adjust peak load in this manner, the commenter suggested that 
Western should give first priority to the power that a proposed 
allottee relinquishes due to load substantiation deficiencies, lack of 
viable transmission access, or other such reasons, and allocate to 
those entities that should have received a higher allocation if Western 
had not reduced the peak load submission.
    Response: Western finds merit in this comment and has accepted it. 
In the development of the BCP Final Allocation, Western re-instated 
loads from unsuccessful applicants back to their host utility that 
maintains load serving responsibility for these loads and recalculated 
the host utility's final allocation.
    In the event an applicant was successful in being awarded an 
allocation, Western retained the reduction to their host utility's 
application in order to refrain from considering the same load in the 
calculation of two separate allocations. In accepting this final 
allocation method, Western will not be providing a priority to the 
power that a proposed allottee relinquished because of load 
substantiation deficiencies, viable transmission access, or other such 
reasons.
    Comment: In substantiating load data, Western should rely on proven 
data sources such as Balancing Authority metered data, metered data 
from a Generation and Transmission Provider, and Transmission Provider 
meter data. Western should inform proposed allottees of data sources 
that would be insufficient or incomplete to

[[Page 75546]]

substantiate loads prior to the October 3, 2014 deadline. If any 
inconsistencies arise after load substantiation submissions on October 
3, 2014, proposed allottees should be provided an opportunity to 
correct any submissions so that the load data Western will use is 
completely accurate.
    Response: On August 21, 2014, Western sent a letter to all proposed 
allottees requiring them to substantiate their actual loads as supplied 
in the applications. Load substantiation materials could include, among 
other things, meter verification reports, historical billing records, 
annual reports, and host utility reports. Tribes were able to use 
estimated historical load values, subject to Western's review and 
adjustment, if actual load data was not available. Western received 
load substantiation materials from all final allottees and worked 
collaboratively to ensure actual loads were accurately depicted based 
on reliable materials including verified metering and/or billing data. 
Western informed those with insufficient or incomplete data submittals 
in a timely fashion and provided an opportunity to revise, correct, or 
confirm any inconsistencies identified. All final allocations are based 
on substantiated historical loads.
    Comment: Western is encouraged to develop operational protocols as 
soon as possible to facilitate planning of necessary transmission 
arrangements.
    Response: Western intends to establish operational protocols within 
the contract negotiation process. This is anticipated to occur in 
calendar year 2015.
    Comment: The City of Maricopa (Maricopa) is served by Electrical 
District No. 3 (ED3). Western's allocation methodology assumed that 
existing Federal power enjoyed by ED3 is shared indirectly with 
Maricopa. This resulted in Maricopa not receiving a proposed allocation 
because ED3's existing Federal power exceeds the targets that Western 
was able to establish in the allocation of BCP. While Maricopa is 
served by ED3, Maricopa does not benefit from ED3's historic allocation 
of Federal power. ED3's Federal power allocations are used exclusively 
for agriculture. This is evidenced by review of ED3's published rate 
structures that differentiate rates for agricultural irrigation loads 
and other uses. These rates clearly define how ED3 sequesters its 
Federal hydro allocation from benefiting non-agricultural customers 
such as the Maricopa. Based on the fact that Maricopa does not benefit 
from ED3's Federal allocation, Western should treat Maricopa as a 
separate island from ED3 in the calculation of BCP allocations.
    Response: In reviewing the comment, Western initially evaluated 
Maricopa's application without considering ED3's Federal power 
allocations as suggested by Maricopa. However, even under this 
scenario, Maricopa would still be ineligible to receive an allocation 
due to not meeting the minimum allocation threshold.
    Comment: The City of Sierra Vista (CSV) is served by Sulphur 
Springs Valley Electric Cooperative Inc. (SSVEC). Western's allocation 
methodology assumed that existing Federal power enjoyed by SSVEC is 
shared indirectly with CSV. This resulted in CSV not receiving a 
proposed allocation because its indirect share of SSVEC's existing 
Federal power causes CSV's target percentage peak load to fall below 
the 100 kW minimum threshold. This logic unfairly punishes an entity 
whose energy goals are to minimize consumption as a buyer, while it 
favors an entity that encourages consumption as a seller. Western's 
proposed allocation between SSVEC and CSV proves this with the later 
receiving zero and the former receiving the maximum allowed in this 
program (3,000 kW). SSVEC has various retail rates differentiating 
classes of customers, namely irrigation versus commercial classes. The 
average price paid by CSV to SSVEC is comparable to rates charged by 
Arizona Public Service and Tucson Electric Power, disproving any 
existing indirect benefit from existing Federal power finding its way 
to the CSV. It is proposed that a carve-out of 150 kW be taken from the 
proposed allocation to SSVEC and reallocated to the CSV.
    Response: The Marketing Criteria calls for allocation distributions 
based on historical loads with minimum and maximum allocation 
thresholds. Western finds distribution based on load is a reasonable 
means of promoting widespread use of Federal power to a diverse base of 
customers. Based on the comments provided, Western is not convinced 
that Federal power provided to SSVEC does not benefit CSV. There are 
many circumstances and variables contributing to the rates that CSV 
pays SSVEC. Comparing the rates CSV pays to the rates of neighboring 
investor owned utilities is not an indication of a lack of indirect 
Federal power benefit CSV might enjoy via SSVEC. In the calculation of 
the BCP Final Allocation, Western accounted for these indirect Federal 
power benefits when considering CSV's application.
    Comment: Several proposed allottees are served by Salt River 
Project (SRP). In the development of the proposed allocations, Western 
considered the indirect benefits of SRP's Federal power allocations 
associated to BCP, CRSP, and Parker Davis Project. These resources are 
supplemented by 450,000 kW from the Navajo Generating Station (NGS) in 
Page, Arizona, which was funded and developed as a Federal project. The 
``Exchange Agreement'' (Contract No. 14-06-400-2468) (Exchange 
Agreement) with the U.S. Bureau of Reclamation (Reclamation) gives 
533,000 kW of CRSP Glen Canyon dam capacity to SRP. The origins of SRP 
are rooted in Federal funding used to construct a series of dams on the 
Salt River with a capacity of 270,000 kW. Western should include these 
indirect benefits of existing Federal power when determining the 
allocations within SRP territory if it uses such logic for other 
applicants with indirect benefits of Federal power.
    Response: Reclamation has a 24.3 percent participating interest in 
the NGS, which is used to provide power for the Central Arizona Project 
(CAP), the Federal water project designed and constructed between the 
1970s and early 1990s to deliver Colorado River water to agricultural 
water users in central Arizona and many of the state's largest 
municipal water users. SRP does not have an allocation of the Federal 
interest in the NGS. Power that is not reserved for CAP use is made 
available to the wholesale market where it may be purchased by other 
utilities, including SRP. This does not convey an allocation or 
entitlement to portions of Reclamation's participating interest in the 
NGS; this surplus power is not sold at-cost, and therefore is not 
considered equivalent with the benefits of Federal power allocations.
    The Exchange Agreement does not convey Glen Canyon generating 
capacity to SRP for its use. The Exchange Agreement provides for up to 
500 megawatts (MW) of Glen Canyon generation delivered to SRP in 
exchange for receiving like amounts of thermal generation from SRP at 
alternate delivery points. This arrangement was established to reduce 
the amount of transmission constructed by both parties. This does not 
convey to SRP an allocation or entitlement to Glen Canyon generation 
and therefore is not considered on par with the benefits of Federal 
power allocations.
    Western acknowledges that the origins of SRP are rooted in Federal 
projects consisting of a series of dams on the Salt River, however a 
multitude of examples demonstrating widespread and diverse benefits of 
Federal funding must be considered if one includes

[[Page 75547]]

SRP's origins. For example, CAP water users also enjoy an economical 
electric supply of NGS and BCP power. Many customers benefit from the 
capabilities of the Federal transmission system. For the purposes of 
this effort, Western focused on the quantifiable direct and indirect 
benefits of Federal power allocations in promotion of widespread use of 
Federal power consistent with Western's statutory mission to market and 
deliver Federal hydropower. Western does not find it appropriate or 
quantifiable to consider Federal participation in the origins of an 
applicant or the applicant's host utility in these proceedings.
    Comment: When speaking of ``direct and indirect benefits,'' Western 
has not defined what the term ``benefits'' means. The relative 
magnitude of an applicant's electrical consumption was not a basis when 
considering the ``benefits'' of Federal power. An allocation of 1 MW to 
a small utility is a significant resource that will greatly ``benefit'' 
the applicant. The allocation of 3 MW to a large utility with almost a 
1,000 MW load doesn't derive the same ``benefit.'' Western has not 
stated the basis for having a ceiling of 3 MW. Why couldn't the ceiling 
have been 2 MW and allocate more capacity to smaller utilities that can 
``benefit'' from an allocation of between 100 kW and 1 MW? A small 
customer is discriminated against simply because it has a small peak 
load that is met by a Federal resource that is greater than the peak 
load targets Western established and not whether the Hoover Schedule D 
would greatly ``benefit'' these small applicants. It is doubtful that 
the receipt of Hoover Schedule D power will have little if any impact 
on a large allottee's overall cost of power, while any allocation will 
substantially ``benefit'' a small allottee's cost of power. A 2 MW 
ceiling is just as meaningful as a 3 MW ceiling and would result in 
power being allocated to small entities that can ``benefit'' the most 
from an allocation of Hoover D power.
    Response: Western has historically used the term ``benefits'' of 
Federal hydropower to refer to the economic cost displacement of 
avoiding more costly power supply purchases or investments. This 
economic cost displacement is assumed to be universal regardless of the 
relative size of the allottee.
    Western considered a substantial body of comments when establishing 
the Marketing Criteria and found a 3 MW maximum allocation would 
provide a balance between meaningful allocations and promoting 
widespread use to a diverse base of customers. At this time, Western is 
only considering comments on the BCP Proposed Allocation and not the 
Marketing Criteria, including the 3 MW maximum allocation provision.
    Comment: The Agua Caliente Band of Cahuilla Indians (ACBCI) urges 
Western to reconsider its allocation of just 1,449 kW to ACBCI and 
increase such allocation to at least 2,500 kW to 3,000 kW. This 
increase of allocation should be granted since (1) Western should have 
accommodated ACBCI's future load needs and not only consider historical 
loads; (2) ACBCI's current Parker-Davis allocation is not relevant to 
this process and should have been disregarded; and (3) the 
``contingent'' nature of the BCP allocation further reduces what actual 
capacity ACBCI might receive from the BCP, placing ACBCI in a position 
of uncertainty in regard to its expansion plans.
    Response: These comments substantially concern matters other than 
the BCP Proposed Allocation and are outside the scope of this process. 
However, for clarity, Western considered and replied to comments 
related to the load basis to be used in the determination of 
allocations and the consideration of existing Federal power allocations 
when establishing the Marketing Criteria. Western determined that 
consideration of future loads would introduce speculation and 
unquantifiable collective risk across all applicants and will not be 
the foundation of establishing allocations. Western also determined 
that it would consider the benefits of existing Federal power 
allocations for all applicants. The ``contingent'' nature of the BCP 
allocation will result, at times, in all BCP customers receiving less 
resource than what was marketed. This has been the case for the vast 
majority of the current contract term of 30 years and is projected for 
the foreseeable future. A pro-rata reduction will be applied 
universally to all BCP customers.
    Comment: Several commenters indicated support for tribal 
allocations as proposed and a final allocation scheme that vests 
allocations of at least some quantity over the 100 kW minimum to every 
tribal applicant. Several tribal applicants received no proposed 
allocation and some comments expressed support for any reallocation 
scheme that favors tribes including those not already considered 
qualified.
    Response: Western appreciates the support for tribal allocations as 
proposed. In establishing the BCP Final Allocation, there were some 
tribal applicants excluded due to the application of the Marketing 
Criteria to the applications received.
    Comment: Western's application of its published allocation criteria 
in this process need not penalize any tribes and should not preclude 
allocations to specific tribal applicants. The wording of the criteria 
as written allows for tribes to now receive BCP power without a total 
preclusion based on the receipt of other Federal resources if the 25 
percent cap is applied differently. Such revisions to what is now 
proposed would be consistent with Western's obligations as resource 
administrator and Federal trustee to tribal interests, while also 
avoiding an overall process delay or disparate burden on non-tribal 
customers, as California recipients are proposed to receive an almost 
proximate share of the resource (20.8 percent) despite the absence of 
historical or trust considerations.
    Response: The BCP Final Allocation was established by applying the 
Marketing Criteria to the applications received and comments concerning 
the Marketing Criteria are outside the scope of this process. Western 
is not convinced that circumventing the Marketing Criteria, which 
already provides a first consideration for Native American tribes, 
would be fair, equitable, or in the public interest.
    Comment: Investor owned utilities are not preference power entities 
and a phase-out program diminishing their allocation over time would be 
appropriate. This should be considered when the next power marketing 
plan is developed.
    Response: Western is not allocating any Schedule D power to an 
investor owned utility. Therefore, this comment is outside of the scope 
of the proposed allocations under consideration.
    Comment: The HPAA states in part that ``[i]n the case of Arizona 
and Nevada, Schedule D contingent capacity and firm energy for new 
allottees other than federally recognized Indian tribes shall be 
offered through the Arizona Power Authority and the Colorado River 
Commission of Nevada, respectively.'' 43 U.S.C. 619a(a)(2)(C)(ii). To 
appropriately apply these ``through'' provisions in Arizona, Western 
should forward a list of the successful non-tribal applicants located 
in Arizona to APA. The APA would then enter into a standard power sales 
contract utilized by the APA for its customers for the specific 
federally-allocated amount of Schedule D power with the successful 
Arizona applicant. The power sales contract would include the relevant 
contract terms mandated by HPAA for Schedule D power.
    Response: Western considers this a contracting issue outside the 
scope of this process. However, for transparency,

[[Page 75548]]

Western has adopted the ``through'' provisions described in HPAA in the 
2012 Conformed Criteria (77 FR 35676). Western intends to contract with 
APA and CRC for the capacity and energy allocated to non-tribal 
entities in the States of Arizona and Nevada respectively. These 
contracts will require APA and CRC to contract with the new allottees 
for the amount of power allocated to them by Western and contain all 
contract terms required by the HPAA, the 2012 Conformed Criteria, and 
any necessary provisions prescribed in Western's contracts with APA 
and/or CRC.
    Comment: The CRC presented a series of concerns with how Western 
has conducted this process which include:
    (1) Western has refused to provide public access to its 
calculations and work papers, which denies participants the opportunity 
to participate effectively in this proceeding.
    (2) Western has denied allocations to eligible Nevada applicants by 
incorrectly calculating the current Hoover power benefit to Nevada 
Power Company's (NPC's) non-residential customers.
    (3) Western has issued proposed allocations without verifying 
applicant loads, which must lead to significant questions regarding 
whether the allocations are valid.
    (4) Western has denied allocations to eligible Nevada applicants by 
applying an extreme version of super-priorities for tribes, which is 
not authorized by the HPAA.
    (5) Western has denied allocations to eligible Nevada applicants by 
giving preference to cooperatives, which is not authorized by the HPAA. 
There is no legislative authority for Western to allocate Schedule D 
power to electric cooperatives.
    (6) Western should apply its criteria in a manner which ensures 
that Nevada's share of Hoover power is closer to the \1/3\ authorized 
by the 1928 Act, not in a matter that exacerbates the disparity.
    (7) Western has not yet taken the necessary steps to ensure that 
Nevada non-tribal applicants receiving allocations through its process 
will contract for Schedule D power through the CRC.
    (8) Western has not yet ensured that entities crossing state 
boundaries will pay their proportionate share of Hoover-related costs.
    (9) Western has not yet re-issued its Hoover Conformed Criteria in 
a single integrated document, making it extremely difficult for 
applicants to understand the process.
    Response: Western's responses in turn to CRC's comments are as 
follows:
    (1) Western responded to all questions presented at the public 
information forums prior to the close of the comment period, including 
how the Marketing Criteria were applied to the applications received. 
The CRC request included access to all materials contained in all 
applications, in particular applicant peak load and resource portfolio 
information. This information has historically been treated as 
confidential and proprietary information in the electric industry. 
Furthermore, Western has previously received numerous comments from 
applicants explicitly stating that application data is confidential, 
proprietary, and disclosure by Western of this information would be 
inappropriate. All applicants that requested further detail regarding 
the consideration of its application were provided a detailed summary 
of how the application was considered. Western finds that sufficient 
information has been provided for all parties to understand how the 
Marketing Criteria were applied to the applications received in order 
to calculate the BCP Final Allocation.
    (2) Western has reviewed CRC's comment regarding the calculation of 
indirect benefits of Federal power for those applicants with load 
served by the NPC and finds merit in accepting the comment as 
suggested. In the calculation of the proposed allocations, Western 
assumed the CRC sub-allocation of BCP power to NPC of 235,232 kW 
benefited all NPC's customers totaling a peak load of 5,761,000 kW as 
reported by the Energy Information Administration (EIA) for calendar 
year 2012. This resulted in Western's assumption of approximately 4.1 
percent of peak load being served by Federal power for all applicants' 
load served by NPC. In researching CRC's comments, Western confirmed 
that Schedule B (135,000 kW) is limited to NPC residential customers 
only. This leaves Schedule A (100,232 kW) left to serve NPC load. As 
reported by NPC and cross-referenced with EIA 2012 data, NPC load is 
composed of approximately 42.7 percent residential and 57.3 percent 
non-residential. This warrants the consideration of 57.3 percent of 
NPC's Schedule A, or 57,461 kW, benefiting non-residential customers 
served by NPC (3,302,675 kW) equating to a NPC indirect Federal power 
benefit to non-residential applicants of approximately 1.74 percent. 
Western finds that no residential load is represented in those 
applicants with load served by NPC. Western recalculated the final 
post-2017 allocations assuming approximately 1.74 percent of NPC non-
residential customers' peak load is being served by Federal power.
    (3) Western did not find it appropriate to verify loads in 
developing proposed allocations as they are subject to change. Western 
has since required all allottees to substantiate their actual loads as 
supplied in the applications. Western received load substantiation 
materials from all final allottees and worked collaboratively to ensure 
actual loads were accurately depicted based on reliable materials, 
including verified metering and/or billing data.
    (4) Western considered and replied to comments related to a first 
consideration for Native American tribes when establishing the 
Marketing Criteria. At this time, Western is only considering comments 
on the BCP Proposed Allocation and not the Marketing Criteria, which 
includes a first consideration for Native American tribes.
    (5) Western considered and replied to comments related to the 
preference and eligibility of cooperatives when establishing the 
Marketing Criteria. At this time, Western is only considering comments 
on the BCP Proposed Allocation and not the Marketing Criteria, which 
includes the preference and eligibility of cooperatives.
    (6) Western considered and replied to comments related to a \1/3\ 
distribution of the 69,170 kW to the States of Arizona, California, and 
Nevada when establishing the Marketing Criteria. At this time Western 
is only considering comments on the BCP Proposed Allocations and not 
the Marketing Criteria, including a \1/3\ each distribution among these 
States.
    (7) Western considers this a contracting issue outside the scope of 
this process. However, for transparency, Western has adopted the 
``through'' provisions described in the HPAA in the 2012 Conformed 
Criteria (77 FR 35676). Western intends to contract with APA and CRC 
for the capacity and energy allocated to non-tribal entities in the 
States of Arizona and Nevada respectively. These contracts will require 
APA and CRC to contract with the new allottees for the amount of power 
allocated to them by Western and contain all contract terms required by 
the HPAA, the 2012 Conformed Criteria, and any necessary provisions 
prescribed in Western's contracts with APA and/or CRC.
    (8) This comment also pertains to a contract issue outside the 
scope of this process. However, Western stated in the 2012 Conformed 
Criteria that contract

[[Page 75549]]

offers shall contain a provision requiring a new allottee to pay a 
proportionate share of its State's respective contribution (determined 
in accordance with each State's applicable funding agreement) to the 
cost of the Lower Colorado River Multi-Species Conservation Program (as 
defined in Section 9401 of the Omnibus Public Land Management Act of 
2009 (Pub. L. 111-11; 123 Stat. 1327)). Western will work with 
stakeholders to ensure the provisions of the HPAA and the 2012 
Conformed Criteria are met in this regard during the contracting 
process in calendar year 2015.
    (9) While establishing the Marketing Criteria, Western stated that 
it will not combine all this information into one integrated document. 
Material is available for review at Western's BCP Web site located at 
http://www.wapa.gov/dsw/pwrmkt/BCP_Remarketing/BCP_Remarketing.htm.

Final Power Allocation

    The BCP Final Allocation is made in accordance with the 2012 
Conformed Criteria, the HPAA, and Western's Marketing Criteria. All 
allocations are subject to the execution of a contract in accordance 
with the 2012 Conformed Criteria. After substantiation of applicant 
loads, corrections as described within, and consideration of comments; 
two allottees were added and one removed from the list of allottees 
contained in the BCP Proposed Allocation. The State of Nevada 
Department of Administration and the State of Nevada Department of 
Transportation were added as final allottees. The Duncan Valley 
Electric Cooperative Inc. was excluded due to the potential allocation 
falling below the 100 kW minimum allocation threshold.
    The BCP Final Allocation is shown in the table below:

----------------------------------------------------------------------------------------------------------------
             Boulder Canyon Project                              Final post-2017 power allocations
----------------------------------------------------------------------------------------------------------------
                                                                                 Firm energy (kWh)
                    Allottee                        Contingent   -----------------------------------------------
                                                   capacity (kW)      Summer          Winter           Total
----------------------------------------------------------------------------------------------------------------
Agua Caliente Band of Cahuilla Indians..........           1,449       2,212,925         950,554       3,163,479
Anza Electric Cooperative, Inc..................           1,596       2,437,679       1,044,541       3,482,220
Augustine Band of Cahuilla Indians..............             479         731,533         314,227       1,045,760
Bishop Paiute Tribe.............................             380         580,339         249,283         829,622
Cabazon Band of Mission Indians.................           1,003       1,531,790         657,975       2,189,765
California Department of Water Resources........           3,000       4,581,625       1,968,021       6,549,646
Chemehuevi Indian Tribe.........................           1,397       2,133,510         916,442       3,049,952
City of Cerritos, California....................           3,000       4,581,943       1,964,953       6,546,896
City of Chandler, AZ Municipal Utilities                     676       1,032,393         443,461       1,475,854
 Department.....................................
City of Corona, California......................           2,988       4,563,774       1,955,570       6,519,344
City of Flagstaff, Arizona......................             201         306,969         131,857         438,826
City of Glendale, Arizona.......................             426         650,591         279,459         930,050
City of Globe, Arizona..........................             115         175,629          75,441         251,070
City of Henderson, Nevada.......................             906       1,383,651         594,342       1,977,993
City of Las Vegas, Nevada.......................           1,054       1,609,678         691,431       2,301,109
City of North Las Vegas, Nevada.................             763       1,165,260         500,533       1,665,793
City of Payson, Arizona.........................             119         181,738          78,065         259,803
City of Peoria, Arizona.........................             691       1,055,301         453,301       1,508,602
City of Phoenix, Arizona........................           3,000       4,581,625       1,968,021       6,549,646
City of Rancho Cucamonga, CA Municipal Utility..           3,000       4,581,945       1,964,940       6,546,885
City of Scottsdale, Arizona.....................           2,366       3,613,375       1,552,112       5,165,487
City of Tempe, AZ Public Works Department.......             241         368,057         158,098         526,155
City of Tucson, Arizona Water Department........           1,248       1,905,956         818,697       2,724,653
City of Victorville, California.................           2,625       4,009,209       1,719,255       5,728,464
Clark County School District....................           3,000       4,581,625       1,968,020       6,549,645
Clark County Water Reclamation District.........             680       1,038,501         446,085       1,484,586
College of Southern Nevada......................             281         429,145         184,338         613,483
Fort McDowell Yavapai Nation....................             338         516,197         221,730         737,927
Gila River Indian Community.....................           3,000       4,581,625       1,968,020       6,549,645
Graham County Electric Cooperative, Inc.........             312         476,489         204,674         681,163
Hualapai Indian Tribe...........................             381         581,866         249,939         831,805
Imperial Irrigation District....................           3,000       4,581,625       1,968,021       6,549,646
Kaibab Band of Paiute Indians...................             124         189,374          81,345         270,719
Las Vegas Paiute Tribe..........................             688       1,050,719         451,333       1,502,052
Las Vegas Valley Water District.................           3,000       4,581,625       1,968,021       6,549,646
Metropolitan Domestic Water Improvement District             179         273,371         117,425         390,796
Mohave Electric Cooperative, Inc................           1,145       1,748,653         751,128       2,499,781
Morongo Band of Mission Indians.................           1,098       1,676,874         720,296       2,397,170
Navajo Tribal Utility Authority.................           3,000       4,581,625       1,968,021       6,549,646
Navopache Electric Cooperative, Inc.............             888       1,356,161         582,534       1,938,695
Northern Arizona Irrigation District Power Pool.             246         375,693         161,378         537,071
Pascua Yaqui Tribe..............................             437         667,390         286,675         954,065
Pechanga Band of Luiseno Mission Indians........           2,000       3,054,417       1,312,014       4,366,431
Salt River Pima-Maricopa Indian Community.......           3,000       4,581,625       1,968,021       6,549,646
San Diego County Water Authority................           1,619       2,472,728       1,060,370       3,533,098
San Luis Rey River Indian Water Authority.......           3,000       4,581,625       1,968,021       6,549,646
San Manuel Band of Mission Indians..............           2,554       3,900,490       1,675,442       5,575,932
State of Nevada Department of Administration....             109         166,465          71,505         237,970
State of Nevada Department of Corrections.......             281         429,145         184,338         613,483
State of Nevada Department of Transportation....             116         177,156          76,097         253,253
Sulphur Springs Valley Electric Cooperative, Inc           2,731       4,170,806       1,791,555       5,962,361
Timbisha Shoshone Tribe.........................             119         181,738          78,065         259,803

[[Page 75550]]

 
Tohono O'odham Nation...........................           2,709       4,137,207       1,777,123       5,914,330
Tonto Apache Tribe..............................             250         381,802         164,002         545,804
Torres Martinez Desert Cahuilla Indians.........           1,659       2,533,639       1,088,315       3,621,954
Trico Electric Cooperative, Inc.................           3,000       4,581,625       1,968,021       6,549,646
Twenty-Nine Palms Band of Mission Indians.......           1,320       2,015,915         865,929       2,881,844
University of Nevada, Las Vegas.................             305         465,799         200,082         665,881
Viejas Band of Kumeyaay Indians.................           1,388       2,119,765         910,538       3,030,303
                                                 ---------------------------------------------------------------
    Total.......................................          80,680     123,217,000      52,909,000     176,126,000
----------------------------------------------------------------------------------------------------------------

    The BCP Final Allocation listed above is based on the quantities of 
contingent capacity and firm energy to be marketed as defined by the 
HPAA and the 2012 Conformed Criteria. In accordance with the provisions 
of the HPAA and the 2012 Conformed Criteria, non-tribal allottees in 
the states of Arizona and Nevada will need to contract for electric 
service with the APA and CRC. Western will offer electric service 
contracts to all Native American tribes and California customers. 
Redistributions of allocated power that is not put under contract by 
specified dates are prescribed under the provisions of the HPAA, the 
2012 Conformed Criteria, and the Marketing Criteria.

Regulatory Procedure Requirements

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.

Environmental Compliance

    In accordance with the DOE National Environmental Policy Act 
Implementing Procedures (10 CFR 1021), Western has determined that 
these actions fit within a class of action B4.1 Contracts, policies, 
and marketing and allocation plans for electric power, in Appendix B to 
Subpart D to Part 1021--Categorical Exclusions Applicable to Specific 
Agency Actions.

    Dated: December 12, 2014.
Mark A. Gabriel,
Administrator.
[FR Doc. 2014-29638 Filed 12-17-14; 8:45 am]
BILLING CODE 6450-01-P


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