Opinion ID: 1292232
Heading Depth: 2
Heading Rank: 3

Heading: BPA's 2004 ROD and Contract Amendments

Text: After the global litigation settlement failed, BPA announced in a Record of Decision on May 25, 2004 (2004 ROD), that it had implemented several contract Amendments (collectively the 2004 Amendments) modifying the 2000 REP Settlement Agreements and establishing IOU benefits for FY 2007-2011. The Amendments include provisions that: (1) specified that BPA elected to provide payments, not physical power, pursuant to the 2000 REP Settlement Agreements and the 2001 LRAs during FY 2007-2011; (2) replaced the established rate case price forecast, which was used to calculate the cash payments BPA would make to the IOUs, with a mark-to-market methodology [5] ; (3) obligated BPA not to reduce IOU benefits even if a reduction was required by Section 7(b)(2) of the NWPA; (4) establish an annual guaranteed $100M floor and a $300M cap on the financial benefits provided to the IOUs for FY 2007-2011 even if Section 7(b)(2) required reduction of IOU benefits below $100M; (5) modify the time allowed the IOUs to pass monetary benefits of the 2000 REP Settlement Agreement through to their residential and small-farm consumers; and (6) implement $100M of the litigation penalty embedded in the 2001 LRAs through rate increases for FY 2007-2011. [6] Finally, the 2004 Amendments provided that if any of its provisions were held void, then the underlying agreement in effect prior to the 2004 Amendments would apply and the provisions of the 2004 Amendments would have no further force or effect unless the parties could negotiate mutually acceptable replacement terms. These 2004 Amendments form the basis of the instant litigation.