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Notice2022-25196

Fiscal Year (FY) 2024-2025 Proposed Power and Transmission Rate Adjustments Public Hearing and Opportunities for Public Review and Comment

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Published

November 18, 2022

Issuing agencies

Energy DepartmentBonneville Power Administration

Abstract

Bonneville is initiating a rate proceeding under the Northwest Power Planning and Conservation Act (Northwest Power Act) to establish power, transmission, and ancillary and control area services rates for the period from October 1, 2023, through September 30, 2025. Bonneville has designated this proceeding Docket No. BP-24.

Full Text

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<title>Federal Register, Volume 87 Issue 222 (Friday, November 18, 2022)</title>
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[Federal Register Volume 87, Number 222 (Friday, November 18, 2022)]
[Notices]
[Pages 69259-69265]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-25196]

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DEPARTMENT OF ENERGY

Bonneville Power Administration

[BPA File No. BP-24]

Fiscal Year (FY) 2024-2025 Proposed Power and Transmission Rate
Adjustments Public Hearing and Opportunities for Public Review and
Comment

AGENCY: Bonneville Power Administration (Bonneville or BPA), Department
of Energy (DOE).

ACTION: Notice of FY 2024-2025 proposed power and transmission rate
adjustments.

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SUMMARY: Bonneville is initiating a rate proceeding under the Northwest
Power Planning and Conservation Act (Northwest Power Act) to establish
power, transmission, and ancillary and control area services rates for
the period from October 1, 2023, through September 30, 2025. Bonneville
has designated this proceeding Docket No. BP-24.

DATES:
Prehearing Conference: The BP-24 proceeding begins with a
prehearing conference, which will be held via telephone at 10:00 a.m.
on Friday, December 2, 2022.
Intervention: Anyone intending to become a party to the BP-24
proceeding must file a petition to intervene on Bonneville's secure
website. Petitions to intervene may be filed beginning on the date of
publication of this Notice and are due no later than 4:30 p.m. on
Monday, December 5, 2022. Part III of this notice, ``Public
Participation in BP-24,'' provides details on requesting access to the
secure website and filing a petition to intervene.

ADDRESSES: Interested parties may obtain the call-in information by
accessing Bonneville's BP-24 web page at <a href="https://www.bpa.gov/goto/bp24">https://www.bpa.gov/goto/bp24</a>
or by contacting the Hearing Clerk at <a href="/cdn-cgi/l/email-protection#1e5c4e2c2a7d727b6c755e79737f7772307d7173">[email&#160;protected]</a>.
Participant Comments: Written comments by non-party participants
must be received by Friday, December 9, 2022, to be considered in the
Administrator's Record of Decision (ROD). Part III of this notice,
``Public Participation in BP-24,'' provides details on submitting
participant comments.

FOR FURTHER INFORMATION CONTACT: Ms. Elissa Haley, DKS-7, BPA
Communications, Bonneville Power Administration, P.O. Box 3621,
Portland, Oregon 97208; by phone toll-free at 1-800-622-4519; or by
email to <a href="/cdn-cgi/l/email-protection#5d3833353c3138241d3f2d3c733a322b">[email&#160;protected]</a>.
The Hearing Clerk for this proceeding can be reached via email at
<a href="/cdn-cgi/l/email-protection#81c3d1b3b5e2ede4f3eac1e6ece0e8edafe2eeec">[email&#160;protected]</a> or via telephone at (503) 479-8506.
Please direct questions regarding Bonneville's secure website to
the Hearing Coordinator via email at <a href="/cdn-cgi/l/email-protection#a5c6d2c2d7ccc3c3c0cbe5c7d5c48bc2cad3">[email&#160;protected]</a> or, if the
question is time-sensitive, via telephone at (503) 230-5107.
Responsible Officials: Mr. Daniel H. Fisher, Power Rates Manager,
is the official responsible for the development of Bonneville's power
rates, and Ms. Rebecca E. Fredrickson, Manager of Transmission Rates,
Tariff, Regulatory and Compliance, is the official responsible for the
development of Bonneville's transmission, ancillary, and control area
services rates.

SUPPLEMENTARY INFORMATION:

Table of Contents

Part I. Introduction and Procedural Matters
Part II. Scope of BP-24 Rate Proceeding
Part III. Public Participation in BP-24
Part IV. Summary of Rate Proposals
Part V. Proposed BP-24 Rate Schedules

Part I--Introduction and Procedural Matters

A. Introduction

The Northwest Power Act provides that Bonneville must establish,
and periodically review and revise, its power and transmission rates so
that they recover, in accordance with sound business principles, the
costs associated with the acquisition, conservation, and transmission
of electric power, including amortization of the Federal investment in
the Federal Columbia River Power System (FCRPS) over a reasonable
number of years, and Bonneville's other costs and expenses. Section
7(i) of the Northwest Power Act requires that Bonneville's rates be
established according to certain procedures, including publication in
the Federal Register, of a notice of the proposed rates and one or more
hearings conducted as expeditiously as practicable by a Hearing Officer
to develop a full and complete record for a final decision by the
Administrator. Bonneville is conducting the BP-24 proceeding to
establish rates for FY 2024-2025.
Bonneville's Rules of Procedure will govern the BP-24 proceeding.
The rules are posted on Bonneville's website at <a href="https://www.bpa.gov/energy-and-services/rate-and-tariff-proceedings/rules-of-procedure-revision-process">https://www.bpa.gov/energy-and-services/rate-and-tariff-proceedings/rules-of-procedure-revision-process</a>.

B. 2022 Integrated Program Review

Bonneville's Integrated Program Review (IPR) process is designed to
allow the public an opportunity to review and comment on Bonneville's
expense and capital cost forecasts before the forecast costs are used
to set rates. Bonneville's 2022 IPR process, which addressed the
expense and capital program level cost forecasts for FY 2024-25, began
in June 2022 and concluded with the issuance of the Final Close-Out
Report in October 2022. At the discretion of the Administrator,
Bonneville may hold additional processes to review these forecasts
outside of the BP-24 rate proceeding.

C. Proposed Settlement of Rates for Power Sales and Transmission,
Ancillary, and Control Area Services

Since August, Bonneville has been engaged in discussions with
customers and other stakeholders to attempt to reach agreement on the
proposed power and transmission rates, including ancillary and control
area services rates, for the FY 2024-2025 rate period. These
discussions have resulted in the BP-24 Rates Settlement, which includes
the FY 2024-2025 rates and other terms that Bonneville is proposing to
adopt in the BP-24 proceeding. A summary of Bonneville's proposed power
and transmission rates is provided in Part IV of this notice. A link to
the BP-24 Rates Settlement is provided in Part V.
The BP-24 Rates Settlement calls for Bonneville to file a motion
with the BP-24 Hearing Officer to establish a deadline for parties in
the BP-24 proceeding to either object to the proposed settlement or
waive the right to contest the settlement. Bonneville intends to file
its motion soon after the BP-24 prehearing conference. If no party in
the BP-24 proceeding objects to the BP-24 Rates Settlement, Bonneville
staff will continue moving forward with the proposal that the
Administrator adopt the settlement. If a party objects to the BP-24
Rates Settlement, Bonneville will notify all parties and decide how to
proceed with respect to rates proposed in the initial proposal.

D. Proposed Procedural Schedule

A proposed schedule for the BP-24 proceeding is provided below,
which assumes the BP-24 Rates Settlement proceeds without objection.
The official schedule will be established by the Hearing Officer and
may be amended by the Hearing Officer as needed during the proceeding.

Prehearing Conference--December 2, 2022.
BPA Files Initial Proposal--December 2, 2022.
Deadline for Petitions to Intervene--December 5, 2022.
Deadline for Objections to Settlement Agreement--December 9, 2022.

[[Page 69260]]

Close of Participant Comments--December 9, 2022.
Final ROD and Final Studies Issued--February 9, 2023.

E. Ex Parte Communications

Section 1010.5 of Bonneville's Rules of Procedure prohibits ex
parte communications. Ex parte communications include any oral or
written communication (1) relevant to the merits of any issue in the
proceeding; (2) that is not on the record; and (3) with respect to
which reasonable prior notice has not been given. The ex parte rule
applies to communications with all Bonneville and DOE employees and
contractors, the Hearing Officer, and the Hearing Clerk during the
proceeding. Except as provided, any communications with persons covered
by the rule regarding the merits of any issue in the proceeding by
other executive branch agencies, Congress, existing or potential
Bonneville customers, nonprofit or public interest groups, or any other
non-DOE parties are prohibited. The rule explicitly excludes and does
not prohibit communications (1) relating to matters of procedure; (2)
otherwise authorized by law or the Rules of Procedure; (3) from or to
the Federal Energy Regulatory Commission (Commission); (4) that all
litigants agree may be made on an ex parte basis; (5) in the ordinary
course of business, about information required to be exchanged under
contracts, or in information responding to a Freedom of Information Act
request; (6) between the Hearing Officer and Hearing Clerk; (7) in
meetings for which prior notice has been given; or (8) as otherwise
specified in Section 1010.5(b) of Bonneville's Rules of Procedure. The
ex parte rule remains in effect until the Administrator's Final ROD is
issued.

Part II--Scope of BP-24 Rate Proceeding

A. Joint Rate Proceeding

The BP-24 proceeding is a joint proceeding for the adoption of both
power and transmission rates for FY 2024-2025 (see Parts IV and V).
This section provides guidance to the Hearing Officer regarding the
scope of the rate proceeding and identifies specific issues that are
outside the scope. In addition to the issues specifically listed below,
any other issue that is not a ratemaking issue is outside the scope of
this proceeding.
Bonneville may revise the scope of the proceeding to include new
issues that arise as a result of circumstances or events occurring
outside the proceeding that are substantially related to the rates
under consideration in the proceeding. See Rules of Procedure, Section
1010.4(b)(8)(iii), (iv). If Bonneville revises the scope of the
proceeding to include new issues, Bonneville will provide public notice
on its website, present testimony or other information regarding such
issues, and provide a reasonable opportunity to intervene and respond
to Bonneville's testimony or other information. Id.
1. Expense and Capital Cost Forecasts
Bonneville's forecasts of its expense and capital costs are not
determined in rate proceedings. Bonneville develops these forecasts for
the purposes of setting rates in external processes, such as the IPR
process described previously, with input from stakeholders. These
forecasts are used in Bonneville's ratemaking, but do not establish
Bonneville's budgets or spending levels for any program. Adjustments
to, and selection of, projects for Bonneville's actual spending levels
for its programmatic spending, including fish and wildlife spending,
occur through the yearly budgetary review process, which includes
submission of Bonneville's budget to Congress.
Bonneville also depreciates the capital spending on the Federal
power and transmission systems over the service lives of the associated
assets. Power's investments are depreciated over fixed periods.
Transmission's depreciation is based on a depreciation study calculated
consistent with industry standards. The service lives of power and
transmission assets, as well as the depreciation study and resulting
depreciation rates, are not determined in rate proceedings.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seek to raise issues
with or challenge the appropriateness or reasonableness of: (1) the
Administrator's forecasts of cost and spending levels, (2) the
identification of projects used in Bonneville's cost forecasts,; or (3)
any decisions on the depreciation rates that are used to calculate
depreciation expense. If any re-examination of cost forecasts is
necessary, such re-examination will occur outside of the rate
proceeding.
The exclusion does not extend to those portions of the revenue
requirement related to the following: (1) interest rate forecasts, (2)
interest expense and credit, (3) Treasury repayment schedules, (4)
calculation of depreciation and amortization expense, (5) forecasts of
system replacements used in repayment studies, (6) purchased power
expenses, (7) transmission cost incurred by Power Services, (8)
generation cost incurred by Transmission Services, (9) minimum required
net revenue, and (10) the costs of risk mitigation actions resulting
from the expense and revenue uncertainties included in the risk
analysis.
2. Federal and Non-Federal Debt Service and Debt Management
During the 2022 IPR process and in other forums, Bonneville
provided the public with background information on Bonneville's
internal Federal and non-Federal debt management policies and
practices. While these policies and practices are not decided in the
IPR process, these discussions were intended to inform interested
parties about these matters so the parties would better understand
Bonneville's debt structure. Bonneville's debt management policies and
practices remain outside the scope of the rate proceeding.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
address the appropriateness or reasonableness of Bonneville's debt
management policies and practices. This exclusion does not encompass
how debt management actions are reflected in ratemaking.
3. Financial and Accounting Policies and Practices
Bonneville's Financial Plan outlines objectives to sustain the
agency's financial strength and resiliency. The Financial Plan focuses
on four main areas: cost management; debt utilization; debt capacity;
and liquidity. Bonneville has adopted certain financial policies to
help further its financial objectives. Bonneville's Financial Reserves
Policy establishes lower and upper thresholds for agency and business
line financial reserves and parameters for actions to be taken when
financial reserves are above or below the thresholds. Bonneville's
Sustainable Capital Financing Policy guides BPA's use of debt and
revenue financing to finance its capital investments. The terms of
Bonneville's Financial Plan and Policies, along with Bonneville's
internal financial and accounting policies and practices, are outside
the scope of the BP-24 proceeding.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
visit or revisit the terms of

[[Page 69261]]

Bonneville's Financial Plan, Financial Reserves Policy, Sustainable
Capital Financing Policy, internal financial and accounting policies
and practices, and previous decisions regarding the adoption and
implementation of the Financial Plan and Policies.
4. Tiered Rate Methodology (TRM)
The TRM restricts Bonneville and its customers with Contract High
Water Mark (CHWM) contracts from proposing changes to the TRM's
ratemaking guidelines unless certain procedures have been successfully
concluded. No proposed changes have been subjected to the required
procedures.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
propose revisions to the TRM made by Bonneville, customers with CHWM
contracts, or their representatives. This exclusion does not extend to
a party or customer that does not have a CHWM contract.
5. Rate Period High Water Mark (RHWM) Process
The RHWM Process preceded the start of the BP-24 proceeding. In
that process, as directed by the TRM, Bonneville established FY 2024-
2025 RHWMs for Public customers that signed contracts for firm
requirements power service providing for tiered rates, referred to as
CHWM contracts. Bonneville established the maximum planned amount of
power a customer is eligible to purchase at Tier 1 rates during the
rate period, the Above-RHWM Loads for each customer, the System Shaped
Load for each customer, the Tier 1 System Firm Critical Output, RHWM
Augmentation, the Rate Period Tier 1 System Capability (RT1SC), and the
monthly/diurnal shape of RT1SC. The RHWM Process provided customers an
opportunity to review, comment on, and challenge Bonneville's RHWM
determinations.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
visit or revisit Bonneville's determination of a customer's FY 2024-
2025 RHWM or other RHWM Process determinations.
6. 2008 Average System Cost Methodology (2008 ASCM) and Average System
Cost Determinations
Section 5(c) of the Northwest Power Act established the Residential
Exchange Program, which provides benefits to residential and farm
consumers of Pacific Northwest utilities based, in part, on a utility's
``average system cost'' (ASC) of resources. The 2008 ASCM is not
subject to challenge or review in a Section 7(i) proceeding.
Determinations of the ASCs of participating utilities are made in
separate processes conducted pursuant to the ASCM. Those processes
began with ASC filings on June 1, 2022, and concluded in October 2022,
with the publication of the Final ASC Reports.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
visit or revisit the appropriateness or reasonableness of the 2008 ASCM
or of any of the ongoing ASC determinations.
7. 2012 Residential Exchange Program Settlement Agreement (2012 REP
Settlement)
On July 26, 2011, the Administrator executed the 2012 REP
Settlement, which resolved longstanding litigation over Bonneville's
implementation of the Residential Exchange Program (REP) under Section
5(c) of the Northwest Power Act, 16 U.S.C. 839c(c). The Administrator's
findings regarding the legal, factual, and policy challenges to the
2012 REP Settlement are explained in the REP-12 Record of Decision
(REP-12 ROD). The Administrator's decisions regarding the 2012 REP
Settlement and REP-12 ROD were upheld by the U.S. Court of Appeals for
the Ninth Circuit in Ass'n of Pub. Agency Customers v. Bonneville Power
Admin., 733 F.3d 939 (9th Cir. 2013). Challenges to Bonneville's
decision to adopt the 2012 REP Settlement and implement its terms in
Bonneville's rate proceedings are not within the scope of this
proceeding.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
visit or revisit in this rate proceeding Bonneville's determination to
adopt the 2012 REP Settlement or its terms.
8. Service to the Direct Service Industries (DSIs)
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
revisit the appropriateness or reasonableness of Bonneville's decisions
regarding service to the DSIs, including Bonneville's decision to offer
contracts to the DSIs and the method, level of service, or other terms
embodied in the existing DSI contracts.
9. Operation and Maintenance of the Power and Transmission Systems
Bonneville operates and maintains the Federal Columbia River
Transmission System and, in coordination with other Federal entities,
the FCRPS in accordance with good utility practice and with applicable
reliability standards and operating requirements. Bonneville's power
and transmission systems operation and maintenance practices and
protocols, such as dispatcher standing orders, operating instructions,
reliability of the system, compliance programs, and other operating
requirements, are non-rate matters.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
address issues regarding operation and maintenance practices and
protocols.
10. Terms and Conditions of Transmission Service
Bonneville offers and provides transmission services, including
interconnection service, and ancillary and control area services in
accordance with the terms and conditions specified in its open access
transmission tariff (Tariff), business practices, and applicable
contracts. In addition to and concurrent with this rate proceeding,
Bonneville is initiating the TC-24 proceeding to modify the Tariff
terms and conditions. Bonneville's business practices provide
implementation details for the Tariff. Bonneville's decisions regarding
the business practices are determined in other forums and follow the
procedures in Bonneville's Business Practice Process posted on its
website. The Tariff terms and conditions, business practices, and the
contracts and contract disputes between Bonneville and its customers
are outside the scope of the BP-24 rate proceeding.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
address issues regarding terms and conditions of transmission service,
including interconnection service, and ancillary and control area
services. This includes, but is not limited to, argument, testimony, or
other evidence regarding Bonneville's decisions whether to offer
particular transmission services, the terms and conditions for

[[Page 69262]]

participating in the EIM, the procedures and standards for
modifications to Bonneville's Tariff or business practices, and whether
to include certain terms and conditions in the Tariff or in business
practices.
11. Oversupply Management Protocol
The proposed OS-24 Oversupply rate is a formula rate designed to
recover Bonneville's actual oversupply costs incurred during the BP-24
rate period. Bonneville incurs oversupply costs pursuant to the
Oversupply Management Protocol, Attachment P of Bonneville's Tariff.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
address the terms of the Oversupply Management Protocol; whether the
Oversupply Management Protocol complies with orders of the Commission;
and whether Bonneville took all actions to avoid using the Oversupply
Management Protocol, including the payment of negative prices to
generators outside of Bonneville's balancing authority area. This
exclusion does not extend to issues concerning the rates for recovering
the costs of the Oversupply Management Protocol.
12. Market Initiatives and Regional Carbon Policies
Bonneville is engaged in a number of market initiatives that are
outside of the scope of this proceeding. These include (1) the Western
Energy Imbalance Market (EIM), which is an extension of the California
Independent System Operator's (CAISO) real-time market; (2) the Western
Resource Adequacy Program (WRAP); and (3) regional cap and trade
policies.
Pursuant to Section 1010.4(b)(8) of the Rules of Procedure, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
raise or revisit Bonneville's decision to join the EIM, the WRAP, or
review or address Bonneville's position on regional cap and trade
policies. This exclusion does not extend to issues concerning rate
incentives and the recovery or distribution of EIM-related, carbon-
related, and WRAP-related costs or credits, which are within the scope
of the BP-24 proceeding.
13. Potential Environmental Impacts, Biological Constraints, and
Related Operations
Environmental impacts are addressed in a National Environmental
Policy Act (NEPA) process Bonneville conducts concurrent with the rate
proceeding. See Section II.B of this notice. In addition, biological
constraints on hydropower operations are determined outside of the rate
case through processes such as intra-agency consultations under the
Endangered Species Act, 16 U.S.C. 1536(a)(2). Finally, implementation
of the decision regarding operations, maintenance and configuration
(management) of the Columbia River System evaluated in the Columbia
River System Operations Environmental Impact Statement (CRSO EIS) and
associated joint ROD with the U.S. Army Corps of Engineers and Bureau
of Reclamation, and associated biological opinions, court orders, and
other agreements, are also not issues to be addressed in this
proceeding.
Pursuant to Section 1010.4(a)(8) of Bonneville's Procedures, the
Administrator directs the Hearing Officer to exclude from the record
all argument, testimony, or other evidence that seeks in any way to
address the potential environmental impacts of the rates being
developed in this rate proceeding, potential biological effects of
operations modeled in the proceeding, the appropriate hydroelectric
constraints defined in these environmental compliance processes, or the
operations, maintenance, and configuration, (management) assumptions,
studies, decisions, or matters addressed in the CRSO EIS or CRSO EIS
joint ROD and associated biological opinions, court orders, and other
agreements.

B. The National Environmental Policy Act

Bonneville is in the process of assessing the potential
environmental effects of its proposed power and transmission rate
adjustments, consistent with NEPA. The NEPA process is conducted
separately from the rate proceeding. As discussed above, all evidence
and argument addressing potential environmental impacts of the rate
adjustments being developed in the BP-24 rate proceeding are excluded
from the rate proceeding record. Instead, comments on environmental
effects should be directed to the NEPA process.
Based on its most current assessment of the proposed power and
transmission rate adjustments, Bonneville believes this proposal may be
the type of action typically excluded from further NEPA review pursuant
to U.S. DOE NEPA regulations, which apply to Bonneville. More
specifically, the proposal appears to solely involve changes to
Bonneville's rates and other cost recovery and management mechanisms to
ensure that there are sufficient revenues to meet Bonneville's
financial obligations and other costs and expenses, while using
existing generation sources operating within normal limits. As such, it
appears this rate proposal falls within Categorical Exclusion B4.3,
found at 10 CFR part 1021, subpart D, app. B4.3 (2015), which provides
for the categorical exclusion from further NEPA review of ``[r]ate
changes for electric power, power transmission, and other products or
services provided by a Power Marketing Administration that are based on
a change in revenue requirements if the operations of generation
projects would remain within normal operating limits.''
Nonetheless, Bonneville is still assessing the proposal, and,
depending upon the ongoing environmental review, Bonneville may instead
issue another appropriate NEPA document. Comments regarding the
potential environmental effects of the proposal may be submitted to
Katey Grange, NEPA Compliance Officer, EC-4, Bonneville Power
Administration, 905 NE 11th Avenue, Portland, Oregon 97232, and to
<a href="/cdn-cgi/l/email-protection#e18a828693808f8684a1839180cf868e97">[email&#160;protected]</a>. Any such comments received by the comment deadline
for Participant Comments identified in Section III.A of this notice
will be considered by Bonneville's NEPA compliance staff in the NEPA
process that is being conducted for this proposal.

Part III--Public Participation in BP-24

A. Distinguishing Between ``Participants'' and ``Parties''

Bonneville distinguishes between ``participants in'' and ``parties
to'' the BP-24 proceeding. Separate from the formal hearing process,
Bonneville will receive written comments, views, opinions, and
information from participants who may submit comments without being
subject to the duties of, or having the privileges of, parties.
Participants are not entitled to participate in the prehearing
conference; may not cross-examine parties' witnesses, seek discovery,
or serve or be served with documents; and are not subject to the same
procedural requirements as parties. Bonneville customers whose rates
are subject to this proceeding, or their affiliated customer groups,
may not submit participant comments. Members or employees of
organizations that have intervened in the proceeding may submit
participant comments as private individuals (that is, not speaking for
their organizations) but may not use the comment

[[Page 69263]]

procedures to address specific issues raised by their intervener
organizations.
Written comments by participants will be included in the record and
considered by the Administrator if they are received by Friday,
December 9, 2022. Participants should submit comments through
Bonneville's website at <a href="http://www.bpa.gov/comment">www.bpa.gov/comment</a> or by hard copy to: BPA
Public Involvement, DKE-7, Bonneville Power Administration, P.O. Box
3621, Portland, Oregon 97208. All comments should contain the
designation ``BP-24'' in the subject line.

B. Interventions

Any entity or person intending to become a party in the BP-24
proceeding must file a petition to intervene through Bonneville's
secure website (<a href="https://ratecase.bpa.gov/">https://ratecase.bpa.gov/</a>). A first-time user of
Bonneville's secure website must create a user account to submit an
intervention. Returning users may request access to the BP-24
proceeding through their existing accounts, and may submit
interventions once their permissions have been updated. The secure
website contains a link to the user guide, which provides step-by-step
instructions for creating user accounts, generating filing numbers,
submitting filings, and uploading interventions. Please contact the
Hearing Coordinator via email at <a href="/cdn-cgi/l/email-protection#adcedacadfc4cbcbc8c3edcfddcc83cac2db">[email&#160;protected]</a> or, if the question
is time-sensitive, via telephone at (503) 230-5107, with any questions
regarding the submission process.
All petitions to intervene must be submitted through the BP-24
proceeding secure website by the deadline established in the procedural
schedule. Late interventions are strongly disfavored. Petitions to
intervene must conform to the format and content requirements in
Sections 1010.6 and 1010.11 of Bonneville's Rules of Procedure.
Petitions must state the name and address of the entity or person
requesting party status and the entity or person's interest in the
hearing.
The Hearing Officer will rule on all petitions to intervene.
Bonneville customers and affiliated customer groups will be granted
intervention based on petitions filed in conformance with the Rules of
Procedure. Other petitioners must explain their interests in sufficient
detail to permit the Hearing Officer to determine whether the
petitioners have a relevant interest in the hearing.
Bonneville or any party may oppose a petition to intervene. The
deadline for opposing a timely petition to intervene is two business
days after the deadline for filing the petition. Opposition to an
untimely petition to intervene must be filed within two business days
after service of the petition.

C. Developing the Record

The hearing record will include, among other things, the
transcripts of the hearing, written evidence and argument entered into
the record by Bonneville and the parties, written comments from
participants, and other material accepted into the record by the
Hearing Officer. The Hearing Officer will review and certify the record
to the Administrator for final decision.
The Administrator will develop final rates based on the record and
such other materials and information as may have been submitted to or
developed by the Administrator. The Final ROD will be made available to
all parties. Bonneville will file its rates with the Commission for
confirmation and approval after issuance of the Final ROD.

Part IV--Summary of Rate Proposals

Bonneville is proposing power and transmission rates for FY 2024-25
that are consistent with the terms of the BP-24 Rates Settlement.

A. Summary of the Power Rate Proposal

Bonneville is proposing four primary rates for Federal power sales
and services, along with general rate schedule provisions to implement
such rates.
1. Priority Firm Power Rate (PF-24)
The PF rate schedule applies to sales of firm power to public body,
cooperative, and Federal agency customers to meet their requirements
pursuant to Section 5(b) of the Northwest Power Act. The PF Public rate
applies to the sale of Firm Requirements Power under CHWM contracts
with customers taking Load Following, Block, or Slice/Block service.
Consistent with the TRM, Tier 1 rates include three charges: (1)
customer charges, (2) a demand charge, and (3) a load shaping charge.
In addition, two Tier 2 Short-Term rates are proposed, the Short-Term
and Load Growth rates. These rates would be applicable to customers
that have elected to purchase power from Bonneville for service to
their Above-RHWM Load.
The proposed average Tier 1 non-Slice product rate impact, which
represents the majority of Bonneville's power sales, is flat relative
to BP-22. The overall average PF Tier 1 rate impact that includes the
Slice and non-Slice products will be a slight decrease relative to BP-
22. Customer-specific results will vary around these average impacts,
with some customers experiencing higher rate impacts and some lower
rate impacts, based on the specific situation of a particular customer.
The Base PF Exchange rate and its associated surcharges apply to
sales pursuant to Residential Purchase and Sale Agreements and
Residential Exchange Program Settlement Implementation Agreements with
regional utilities that participate in the REP established under
Section 5(c) of the Northwest Power Act, 16 U.S.C. 839c(c). The Base PF
Exchange rate establishes the threshold for participation in the REP;
only utilities with ASCs above the appropriate Base PF Exchange rate
may receive REP benefits. If a utility meets the threshold, a utility-
specific PF Exchange rate will be established in this proceeding for
each eligible utility. The utility-specific PF Exchange rate is used in
calculating the REP benefits each REP participant will receive during
FY 2024-2025.
The proposed PF-24 rate schedule also includes resource support
services rates for customers with non-Federal resources, and a melded
PF rate for Public customers that have elected power sales contracts
other than CHWM contracts for firm requirements service.
2. New Resource Firm Power Rate (NR-24)
The NR-24 rate applies to firm power sales to investor-owned
utilities (IOUs) to meet their net requirements pursuant to Section
5(b) of the Northwest Power Act. The NR-24 rate is also applied to
sales of firm power to Public customers when this power is used to
serve new large single loads. In addition, the NR rate schedule
includes rates for services to support Public customers serving new
large single loads with non-Federal resources. In the BP-24 Initial
Proposal, Bonneville is forecasting no power sales at the NR rate.
3. Industrial Firm Power Rate (IP-24)
The IP rate is applicable to firm power sales to DSI customers
authorized by Section 5(d)(1)(A) of the Northwest Power Act, 16 U.S.C.
839c(d)(1)(A). In the BP-24 Initial Proposal, Bonneville is forecasting
sales to one DSI customer at the IP rate.
4. Firm Power and Surplus Products and Services Rate (FPS-24)
The FPS rate schedule is applicable to sales of various surplus
power products and surplus transmission capacity for use inside and
outside the Pacific Northwest. The rates for these products are
negotiated between Bonneville and the purchasers. The FPS-24 rate
schedule also includes rates for customers with non-Federal resources;

[[Page 69264]]

the Unanticipated Load Service rate; rates for other capacity, energy,
and scheduling products and services; rates for reserve services for
use outside the Bonneville balancing authority area; and real power
losses rates for customers that elect financial settlement of real
power losses. Bonneville is proposing a new FPS rate, the Firm Water
Transition Power rate that would be applicable to specific Slice
customers to help transition them to Bonneville's recently adopted 30-
water year and 10th percentile metrics for forecasting firm output.
5. Power General Rate Schedule Provisions (GRSPs)
The Power GRSPs include general rate schedule terms and conditions
applicable to Bonneville's power rates. In addition, the Power GRSPs
contain special rate adjustments, charges, credits, and pass-through
mechanisms for specific events and customer circumstances. Among other
matters covered by the Power GRSPs are provisions related to
calculating rates, resource support services, charges associated with
transfer service, risk adjustments, Slice True-up, the Residential
Exchange Program, conservation, payment options, and other charges.
Bonneville is proposing two new GRSPs: the Washington Cap-and-Invest
Program Charge that would be applicable if Bonneville becomes a First
Jurisdictional Deliverer in this program; and a Resource Adequacy
Service credit and charge that would be applicable if Bonneville begins
participation in a binding season in the Western Resource Adequacy
Program under certain defined conditions. Bonneville is also proposing
a change in the market index it uses for various services and rates as
well as proposing the addition of a rate cap on the Unauthorized
Increase Charge.

B. Summary of the Transmission Rate Proposal

Bonneville is proposing to extend the current (BP-22) transmission
rate levels for the FY 2024-25 rate period, pursuant to the BP-24 Rates
Settlement. Bonneville is proposing separate transmission rates for its
Network segment, intertie segments, ancillary and control area
services, and for various specific purposes.
1. Network Rates
The Network Integration Transmission Rate (NT-24) applies to
customers taking network integration service, which allows customers to
flexibly serve retail load.
The Point-to-Point Rate (PTP-24) is a contract demand rate that
applies to customers taking Point-to-Point service on Bonneville's
network. Point-to-Point service provides customers with service from
identified points of receipt to identified points of delivery. There
are separate rates for long-term firm service, and various increments
of firm and non-firm short-term service.
The Formula Power Transmission Rate (FPT-24.1) is based on the cost
of using specific types of facilities, including a distance component
for the use of transmission lines, and is charged on a contract demand
basis.
2. Intertie Rates
The Southern Intertie Rate (IS-24) is a contract demand rate that
applies to customers taking Point-to-Point service on the Southern
Intertie.
The Montana Intertie Rate (IM-24) applies to customers taking
Point-to-Point service on the Eastern Intertie and that are not parties
to the Montana Intertie Agreement.
The Townsend-Garrison Transmission Rate (TGT-24) applies to parties
to the Montana Intertie Agreement taking firm service over Bonneville's
section of the Montana Intertie.
The Eastern Intertie Rate (IE-24) applies to parties to the Montana
Intertie Agreement taking non-firm service on the portion of the
Eastern Intertie capacity that exceeds Bonneville's firm transmission
rights.
3. Other Transmission Rates and General Rate Schedule Provisions
The Use-of-Facilities Rate (UFT-24) establishes a formula rate for
the use of a specific facility based on the annual cost of that
facility.
The Advance Funding Rate (AF-24) allows Bonneville to collect the
capital and related costs of specific facilities through an advance-
funding mechanism.
The Regional Compliance Enforcement and Regional Coordinator rate
(RC-24) recovers costs assessed to Bonneville for regional reliability
compliance monitoring, enforcement, and reliability coordination
services.
The Oversupply Rate (OS-24) recovers the costs Bonneville incurs to
displace generation under the Oversupply Management Protocol,
Attachment P to Bonneville's Tariff.
Other proposed transmission rates and charges include: a Utility
Delivery Charge for the use of low-voltage delivery substations; a
Reservation Fee for customers that postpone the service commencement
date of transmission service; incremental cost rates for transmission
service requests that require new facilities; a penalty charge for
failure to comply with dispatch, curtailment, redispatch, or load
shedding orders; an Unauthorized Increase Charge for use of the
transmission system in excess of contracted-for demand; and rate
adjustment mechanisms consistent with Bonneville's Financial Policies.
Bonneville's proposes two new charges associated with real power
loss returns. First, Bonneville is proposing a charge to settle loss
imbalances associated with in-kind loss returns. In addition, the
Invalid Loss Return penalty charge is proposed to replace the Financial
for Inaccuracy penalty charge in the current rate schedules and incent
accurate and timely return of in-kind loss return obligations.
4. Ancillary Service and Control Area Service Rates
The BP-24 Transmission Rates Proposal includes rates for
Bonneville's Ancillary and Control Area Services, along with certain
updates to those rates and new rates. Bonneville proposes two new rates
and certain changes to existing rates to support its participation in
the EIM.
The EIM Contingency Rate is a new rate Bonneville is proposing to
apply under temporary EIM contingency events that require corrective
action. This rate would allow the EIM market operator to settle using
an alternative pricing index when EIM pricing is unavailable.
Bonneville is proposing a new rate to recover credits and charges
for the Flexible Ramping Product associated with EIM participation.
Bonneville did not previously recover these credits and charges in
rates.
Bonneville proposes to remove or revise certain provisions of the
rate schedules that were adopted in the BP-22 rate proceeding to
account for the mid-rate period transition to the Western EIM.

D. Risk Mitigation Tools

Bonneville is proposing three rate adjustment mechanisms for BP-24
power and transmission rates, primarily to buffer against poor
financial performance over the rate period and protect the agency's
solvency and strong credit rating. These mechanisms implement
Bonneville's Financial Reserves Policy (FRP) and provide for
adjustments to a business line's rates or other action in the event the
business line's financial reserves for risk (Financial Reserves) fall
below or exceed certain thresholds.
The Cost Recovery Adjustment Clause (CRAC) will adjust rates upward
to

[[Page 69265]]

generate additional revenue within the rate period if business line
Financial Reserves fall below a defined lower threshold.
The Financial Reserves Policy Surcharge (FRP Surcharge) will also
adjust rates upward to generate additional revenue within the rate
period if business line Financial Reserves fall below a defined lower
threshold.
Finally, the Reserves Distribution Clause (RDC) will trigger if
Financial Reserves exceed upper thresholds for the business line and
the agency as a whole. If the RDC triggers, Bonneville will consider
the amount of Financial Reserves above the threshold for rate relief or
investment in high-value, business line-specific purposes such as debt
retirement.
Bonneville is proposing certain revisions in the three risk
adjustment clauses. First, for FY 2024, the three Power risk adjustment
clauses will not be applicable to the portion of a customer's service
at PF Tier 1 rates that has been converted from a Slice product to a
non-Slice product beginning October 1, 2023. However, the three risk
adjustment clauses will apply to such customer's entire service at PF
Tier 1 rates for FY 2025. Second, any FY 2024 or 2025 Power RDC will
automatically provide a dividend distribution in an amount equal to the
lesser of the RDC amount and the amount of Planned Net Revenues for
Risk included in the BP-24 power rates. And third, the caps on the
Power and Transmission RDCs are removed for the BP-24 rate period, FY
2024-2025.

Part V--Proposed BP-24 Power Rate Schedules and BP-24 Transmission
Rates Schedules

Bonneville's proposed BP-24 Power Rate Schedules and BP-24
Transmission Rate Schedules, which includes Transmission, Ancillary,
and Control Area Services Rate Schedules, are a part of this notice and
are available for viewing and downloading on Bonneville's website at
https://www.bpa.gov/goto/BP24. The BP-24 Rates Settlement agreement is
also posted at this website.

Signing Authority

This document of the Department of Energy was signed on November 8,
2022, by John L. Hairston, Administrator and Chief Executive Officer of
the Bonneville Power Administration, pursuant to delegated authority
from the Secretary of Energy. This document with the original signature
and date is maintained by DOE. For administrative purposes only, and in
compliance with requirements of the Office of the Federal Register, the
undersigned DOE Federal Register Liaison Officer has been authorized to
sign and submit the document in electronic format for publication, as
an official document of the Department of Energy. This administrative
process in no way alters the legal effect of this document upon
publication in the Federal Register.

Signed in Washington, DC, on November 15, 2022.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2022-25196 Filed 11-17-22; 8:45 am]
BILLING CODE 6450-01-P

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