Notice2024-10997
Proposed 2028 Parker-Davis Project Power Marketing Plan
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
May 20, 2024
Issuing agencies
Energy DepartmentWestern Area Power Administration
Abstract
The Department of Energy (DOE), Western Area Power Administration (WAPA), Desert Southwest Region (DSW) has developed a Proposed 2028 Parker-Davis Project (P-DP) Power Marketing Plan (Proposed 2028 Plan). The Proposed 2028 Plan provides for marketing power from P-DP from October 1, 2028, through September 30, 2048. WAPA currently markets 259,206 kilowatts (kW) of capacity and associated energy from P-DP in the summer and 198,337 kW in the winter, under long-term contracts to 35 customers located in Arizona, California, and Nevada. On September 30, 2028, WAPA's existing long-term sales contracts for P-DP power will expire, and the Proposed 2028 Plan would take effect October 1, 2028. WAPA developed the Proposed 2028 Plan to define the products and services to be offered, along with Eligibility and Allocation Criteria that will lead to allocations of P-DP power to contractors. This Federal Register notice initiates the formal public process for the Proposed 2028 Plan. As part of the process, WAPA requests public comment.
Full Text
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<title>Federal Register, Volume 89 Issue 98 (Monday, May 20, 2024)</title>
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[Federal Register Volume 89, Number 98 (Monday, May 20, 2024)]
[Notices]
[Pages 43841-43847]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-10997]
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DEPARTMENT OF ENERGY
Western Area Power Administration
Proposed 2028 Parker-Davis Project Power Marketing Plan
AGENCY: Western Area Power Administration, Department of Energy (DOE).
ACTION: Notice of proposed plan.
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SUMMARY: The Department of Energy (DOE), Western Area Power
Administration (WAPA), Desert Southwest Region (DSW) has developed a
Proposed 2028 Parker-Davis Project (P-DP) Power Marketing Plan
(Proposed 2028 Plan). The Proposed 2028 Plan provides for marketing
power from P-DP from October 1, 2028, through September 30, 2048. WAPA
currently markets 259,206 kilowatts (kW) of capacity and associated
energy from P-DP in the summer and 198,337 kW in the winter, under
long-term contracts to 35 customers located in Arizona, California, and
Nevada. On September 30, 2028, WAPA's existing long-term sales
contracts for P-DP power will expire, and the Proposed 2028 Plan would
take effect October 1, 2028. WAPA developed the Proposed 2028 Plan to
define the products and services to be offered, along with Eligibility
and Allocation Criteria that will lead to allocations of P-DP power to
[[Page 43842]]
contractors. This Federal Register notice initiates the formal public
process for the Proposed 2028 Plan. As part of the process, WAPA
requests public comment.
DATES: A consultation and comment period begins today and will end
August 19, 2024. WAPA will present a detailed explanation of the
Proposed 2028 Plan during a public information forum that will be held
June 20, 2024 from 1 p.m. to no later than 4 p.m. Mountain Standard
Time (MST). WAPA will host a public comment forum that will be held
July 19, 2024 from 1 p.m. to no later than 4 p.m. MST, or until the
last comment is received. The public information and public comment
forums will be conducted as hybrid meetings with both in-person and
virtual options. Information and instructions for participating in the
forums will be posted on DSW's website at least 14 days prior to these
events at: <a href="https://www.wapa.gov/about-wapa/regions/dsw/pdpremarketing">https://www.wapa.gov/about-wapa/regions/dsw/pdpremarketing</a>.
Oral and written comments may be presented at the public comment
forum. A transcript of oral comments made at this forum will be
available from the court reporter or on DSW's website identified above.
WAPA will accept written comments at any time during the consultation
and comment period. To ensure consideration, written comments on the
Proposed 2028 Plan must be received or postmarked by August 19, 2024.
WAPA reserves the right not to consider any comments received or
postmarked after the close of the comment period.
The record, including all documents sent to WAPA by the public for
the purpose of developing the new marketing plan, will be available on
DSW's website. Program information and the existing P-DP marketing plan
documents are also available on the website.
After all public comments have been considered, WAPA will publish a
Final 2028 Power Marketing Plan (Final 2028 Plan) in the Federal
Register.
ADDRESSES: Written comments regarding the Proposed 2028 Plan may be
submitted to: Jack D. Murray, Regional Manager, Desert Southwest
Region, Western Area Power Administration, P.O. Box 6457, Phoenix, AZ
85005-6457, fax (602) 605-4663, or email: <a href="/cdn-cgi/l/email-protection#265642560b54434b47544d43524f4841665147564708414950"><span class="__cf_email__" data-cfemail="d2a2b6a2ffa0b7bfb3a0b9b7a6bbbcb592a5b3a2b3fcb5bda4">[email protected]</span></a>.
The public information and public comment forums will be held at
WAPA's DSW office, located at 615 South 43rd Avenue, Phoenix, Arizona
85009. As access to WAPA facilities is controlled, any U.S. citizen
wishing to attend a forum in person must present an official form of
picture identification (ID), such as a U.S. driver's license, U.S.
passport, U.S. government ID, or U.S. military ID. Foreign nationals
should contact Cheryl Cruz at (602) 605-2664 or email:
<a href="/cdn-cgi/l/email-protection#3e5a4d494e494c534c557e495f4e5f10595148"><span class="__cf_email__" data-cfemail="1e7a6d696e696c736c755e697f6e7f30797168">[email protected]</span></a>, in advance of the forum to obtain the necessary
form for admittance.
FOR FURTHER INFORMATION CONTACT: Jennifer Henn, Power Markets Advisor,
Desert Southwest Region, Western Area Power Administration, (602) 605-
2572 or email: <a href="/cdn-cgi/l/email-protection#ccbca8bce1bea9a1adbea7a9b8a5a2ab8cbbadbcade2aba3ba"><span class="__cf_email__" data-cfemail="037367732e71666e62716866776a6d6443746273622d646c75">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
Background
P-DP, initially authorized by Congress in 1935, is a large power
and water system of the Lower Colorado River Basin located in Arizona,
California, and Nevada. In the original 1935 authorization for the
Parker Dam, Congress defined the purposes of the Project as follows:
(1) controlling floods; (2) improving navigation; (3) regulating the
flow of the streams of the United States; (4) providing for storage and
delivery of water; (5) the reclamation of public lands and Indian
reservations; (6) other beneficial uses; and (7) for the generation of
electric energy as a means of financially aiding and assisting such
undertakings.\1\ The Davis Dam was authorized by the Secretary of
Interior in 1941 pursuant to his authority under the Reclamation
Project Act of 1939.\2\ In 1954, Congress consolidated operations of
the Parker and Davis Dams into a single project, now known as P-DP, for
the purpose of ``effecting economies'' and increased efficiency in the
construction, operation, maintenance, and accounting thereof.\3\
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\1\ 49 Stat. 1028, 1039 (Aug. 30, 1935).
\2\ See 53 Stat. 1187 (Aug. 4, 1939).
\3\ 68 Stat. 143 (May 28, 1954).
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P-DP power facilities include Davis Dam, with its total operating
capacity of 255,000 kW for P-DP, and Parker Dam, with 60,000 kW of
operating capacity allotted to P-DP and 60,000 kW allotted to
Metropolitan Water District of Southern California. Both dams are
operated and owned by the Bureau of Reclamation (Reclamation). WAPA
owns and operates approximately 1,500 miles of high voltage
transmission lines and 45 substations throughout Arizona, California,
and Nevada to facilitate delivery of P-DP power in those three states.
History of Parker-Davis Project Power Allocations
WAPA allocates power not reserved for project purposes to
preference power customers in accordance with its authority under
Reclamation law \4\ and the Department of Energy Organization Act of
1977,\5\ which transferred Reclamation's power marketing functions to
the DOE, acting by and through WAPA.
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\4\ See, e.g., Reclamation Project Act of 1939, sec. 9(c), 53
Stat. 1187, 1194 (Aug. 4, 1939), as amended or supplemented (43
U.S.C. 485h(c)).
\5\ See 91 Stat. 565, 578, sec. 302 (Aug. 4, 1977) (42 U.S.C.
7152).
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On December 28, 1984, following an extensive public process,
litigation, and congressional action, WAPA published the Conformed
General Consolidated Power Marketing Criteria or Regulations for
Boulder City Area Projects (hereinafter referred to as the ``Conformed
Criteria,'' 49 FR 50582). The Conformed Criteria established general
marketing principles for the Federal projects within the jurisdiction
of the then-existing Boulder City Area Office of WAPA, which included
P-DP, Boulder Canyon Project (Hoover), and Central Arizona Project
(Navajo) (49 FR 50582, 50584). The Conformed Criteria also set forth
marketing criteria specific to P-DP once contracts expired on May 31,
1987, reserved power for existing P-DP contractors upon application and
made available additional power to new and current contractors in
excess of that power reserved by existing contractors and reserved for
priority use (Id. at 49 FR 50584-50587). As part of a separate public
process and consistent with the Conformed Criteria, WAPA issued final
allocation criteria and allocations of capacity and energy from P-DP
for the period beginning June 1, 1987 (52 FR 28333).
In 2002, WAPA initiated a public process to remarket P-DP power
when the existing contracts were set to expire on September 30, 2008
(See 67 FR 51580). On May 5, 2003, WAPA published a decision to: (1)
apply the Power Marketing Initiative (PMI), 10 CFR 905.30 through
905.37, to the P-DP remarketing effort; (2) increase the summer and
winter marketable capacity; (3) increase capacity available to existing
P-DP contractors as of October 1, 2008; (4) round up allocations of
less than one mega-watt (MW) to an even one MW in summer and winter,
and allocations of less than two MW to an even two MW in summer only;
(5) extend for 20 years 93 percent of existing contractors' adjusted
allocations; and (6) use the remaining 7 percent of adjusted
allocations for a resource pool (68 FR 23709). In subsequent, separate
public processes, WAPA issued decisions on resource pool eligibility
and allocation criteria and final allocations for the 2008-2028
[[Page 43843]]
marketing period (70 FR 74805; 71 FR 70380). WAPA's decisions for the
2008-2028 period did not otherwise alter marketing criteria applicable
to the 1987-2008 marketing period, including the energy allocation
methodology and minimum scheduling requirements set forth in the
Conformed Criteria (See 49 FR 50582, 50585, 50587).
Development of the Proposed 2028 Plan
WAPA developed the Proposed 2028 Plan: (1) to define the products
and services WAPA will offer, and (2) to determine the criteria for
marketing and allocating power from October 1, 2028, through September
30, 2048. In the Proposed 2028 Plan, WAPA proposes to offer a resource
extension to existing contractors and to offer a portion of the
resource to new allottees.
As explained in the DATES section of this notice, WAPA will hold
public information and public comment forums on the Proposed 2028 Plan.
After considering all public comments, WAPA will publish a notice of
the Final 2028 Plan in the Federal Register. As part of that notice,
WAPA will announce its decisions regarding power resource extensions to
existing contractors and resource allocations to new allottees. If WAPA
determines to issue resource allocations to new allottees in the Final
2028 Plan, it will include in the same Federal Register notice a call
for applications from preference entities interested in receiving an
allocation of Federal power from P-DP (Call for Resource Pool
Applications). The deadline for receipt of applications will be set
forth in the notice. WAPA then would evaluate the applications,
determine which applications meet the requirements of the Final 2028
Plan, and exercise its discretion, provided by law, to allocate power
to certain eligible applicants. Proposed and final allocations
subsequently will be published in the Federal Register.
The Proposed 2028 Plan incorporates the intent of the Energy
Planning and Management Program (EPAMP) (10 CFR part 905), published by
WAPA on October 20, 1995 (herein referred to as the ``Final Rule,'' 60
FR 54151). EPAMP implements Section 114 of the Energy Policy Act of
1992,\6\ and requires WAPA's customers to prepare Integrated Resource
Plans. The PMI (10 CFR 905.30 through 905.37) provides a framework for
extending power allocations to existing contractors and establishing
project-specific resource pools.\7\
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\6\ 106 Stat. 2776, 2799 (Oct. 24, 1992) (42 U.S.C. 7275 et
seq.).
\7\ In the Final Rule, WAPA stated that application of the PMI,
including the amount of resource extended, would initially apply
only to the Pick-Sloan Missouri Basin Program-Eastern Division and
the Loveland Area Projects. Applicability to other projects would be
determined through future, project-specific public processes. As
noted previously, on May 5, 2003, WAPA published a decision to apply
the Power Marketing Initiative (PMI), 10 CFR 905.30 through 905.37,
to the P-DP remarketing effort for the 2008-2028 period.
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The PMI calls for extending a major portion of the resources
currently under contract to existing long-term firm power customers for
a period beyond the expiration date of their current contracts (10 CFR
905.30(a)). The PMI provides, ``[t]he remaining unextended power will
be used to establish project-specific resource pools'' which will be
made available to new eligible customers (10 CFR 905.32(a)). In
addition, the PMI states, ``at two 5-year intervals after the effective
date of the extension to existing customers, [WAPA] shall create a
project-specific resource pool increment of up to an additional 1
percent of the long-term marketable resource under contract at the
time. The size of the additional resource pool increment shall be
determined by [WAPA] based on consideration of the actual fair-share
needs of eligible new customers and other appropriate purposes'' (10
CFR 905.32(b)). The Final Rule adopting EPAMP noted specific terms and
conditions associated with allocations out of each resource pool would
be determined during future, project-specific public processes (60 FR
54151, 54163). The Final Rule further stated, ``[o]ne of [WAPA]'s goals
in the PMI is to achieve widespread use of [WAPA]'s resources.
Reservation of a modest percentage of resources to create a resource
pool is consistent with a policy of encouraging widespread use of
Federal hydroelectric power'' (Id.).
Proposed 2028 Plan
The Proposed 2028 Plan will provide new power marketing criteria
for P-DP. The Proposed 2028 Plan addresses: (1) the power to be
marketed after September 30, 2028, which is the termination date for
all P-DP electric service contracts; (2) the general terms and
conditions under which the power will be marketed starting on October
1, 2028, and going through September 30, 2048; and (3) the criteria to
determine eligibility for allocations from the proposed resource pool.
Within broad statutory guidelines and operational constraints of P-
DP, WAPA has wide discretion as to whom and under what terms it will
contract for the sale of Federal power, if preference is accorded to
statutorily defined entities. WAPA markets power in a manner that will
encourage the most widespread use at the lowest possible rates
consistent with sound business principles.
I. Marketable Power Resource
The primary purpose of P-DP is water control and delivery. The
water control system consists of storage reservoirs that provide daily,
seasonal, and annual flow regulation. Power generated from these
resources depends on hydrology and water operation requirements.
Some of the power generated by P-DP is reserved for priority use by
the United States (herein referred to as ``Priority Use Power'' or
``PUP''). PUP is capacity and energy required for the development and
operation of Reclamation projects as required by legislation
(Reclamation project use power), and irrigation pumping on certain
Indian lands. Reclamation project use power is defined to mean that
capacity and energy for Reclamation projects in the Lower Colorado
River Basin. The following is a list of facilities and projects for
which Reclamation project use power is reserved: relift and drainage
pumps; construction campsites; the Yuma-Mesa Irrigation and Drainage
District; Gila Project drainage pumps; Wellton-Mohawk Irrigation and
Drainage District Plant Nos. 1, 2, and 3; and the Colorado River Front
Work and Levee System. Power for irrigation pumping on certain Indian
lands is defined to mean capacity and energy for use in irrigation
pumping on Indian irrigation projects which are adjacent to the Lower
Colorado River south of Davis Dam and north of the border between the
United States and Mexico.
WAPA proposes that P-DP power in surplus to that reserved for PUP
shall be reserved for allocation to existing contractors and a resource
pool shall be offered to potential new contractors, consistent with
applicable law and the terms and conditions provided herein. Power that
is reserved as PUP, but not presently needed, also may be marketed to
contractors as withdrawable power. Withdrawable power is power that can
be withdrawn for Reclamation project use power and power for irrigation
pumping on Indian lands, which shall have equal priority. When PUP is
requested, WAPA will confirm that the power to be withdrawn will be
used for the above specified purposes, and then will withdraw the
necessary amount of PUP upon a two-year advance notice. Withdrawals of
power will be made as requested and confirmed until the total
[[Page 43844]]
amount of power reserved for priority use purposes is in use.
II. Products and Services
WAPA proposes to market a fixed amount of capacity, referred to as
Contract Rate of Delivery (CROD), for the summer and winter seasons. As
described in further detail in Part III, WAPA proposes to have at least
259,206 kW of marketable capacity in the summer and at least 198,337 kW
of marketable capacity in the winter, beginning October 1, 2028. The
summer season for any calendar year is the seven-month period beginning
the first day of P-DP's March billing period and continuing through the
last day of its September billing period. The winter season is the
five-month period beginning the first day of P-DP's October billing
period and continuing through the last day of its February billing
period in the next succeeding calendar year.
Under the existing P-DP marketing plan, energy allocations are a
fixed seasonal amount for the length of customers' contracts and are
equal to 3,441 kWh/kW, a 67 percent capacity factor, in the summer
season, and 1,703 kWh/kW, a 47 percent capacity factor, in the winter
season (49 FR 50582, 50587; 68 FR 23709, 23709). Due to challenging
hydrological conditions in the Colorado River Basin, this methodology
has imposed increasing financial burdens on contractors during the
current marketing period, as WAPA has been required to purchase
significant amounts of power to meet contractors' firm energy
requirements. Accordingly, WAPA proposes to eliminate this methodology
and instead offer energy amounts for three-month periods (``Quarterly
Energy'') based on Reclamation's 24-month generation projection studies
(``24-Month Study''), which are released every month. The Quarterly
Energy would be published for contractors by no later than the last day
of August for October through December, the last day of November for
January through March, the last day of February for April through June,
and the last day of May for July through September, of each year during
the marketing period. This would allow for energy deliveries to be more
aligned with actual generation, thereby decreasing the amount of power
WAPA would have to purchase and reducing financial burdens on
contractors. Under the Proposed 2028 Plan, available generation, less
PUP (which would continue to be fixed on the same terms as under the
existing marketing plan), would be published for contractors in the
form of Quarterly Energy based on a pro rata share of their seasonal
CROD.
WAPA is also proposing to purchase energy on behalf of contractors
to supplement projected hydropower generation (``Optional Energy''), if
requested. Contractors must elect to purchase Optional Energy from WAPA
no later than the day before prescheduling takes place. The amount of
Optional Energy requested, combined with the contractor's monthly
energy entitlement pursuant to its Quarterly Energy, must not exceed
the contractor's CROD scheduled at a hundred percent capacity factor
(contractor's CROD multiplied by twenty-four hours multiplied by the
number of days in the month). An estimated monthly price for Optional
Energy will be published by WAPA at least quarterly but may be revised
and re-published as conditions dictate. The actual costs associated
with Optional Energy purchased by WAPA will be passed through to the
contractor who elects to receive it.
There may be instances, after Quarterly Energy has been published,
that Reclamation makes significant reductions to generation
projections. For example, sustained periods of precipitation and/or run
off from water sources other than the Colorado River can result in
water being stored in Lake Mead for later use, thereby reducing P-DP
generation. To minimize power purchases resulting from these
situations, WAPA proposes to revise contractors' monthly energy
entitlements when significant generation reductions occur after
Quarterly Energy has been published. A significant reduction in
generation would occur when dollars associated with projected purchase
power requirements needed to maintain the Quarterly Energy for a
particular month exceed dollars associated with that month's portion of
WAPA's Annual Purchase Power Projection. The Annual Purchase Power
Projection is an annual estimate of what power WAPA will purchase in
the upcoming fiscal year, from October 1 through September 30.
Currently, WAPA's Annual Purchase Power Projection is used as a
component of the P-DP firm electric service (FES) rate. When such
significant reductions occur, WAPA would publish contractors' revised
energy for the month using the reduced generation projections. Revised
energy would continue to be based on a pro rata share of contractors'
CROD and would be effective no later than one day prior to
prescheduling. Contractors could request that WAPA purchase Optional
Energy on their behalf per the terms described above to obtain energy
following a revision.
WAPA also proposes to designate the portion of projected annual
generation exceeding a kWh calculation of all projected marketable
capacity (including PUP) multiplied by a 67 percent capacity factor in
the summer season and 47 percent capacity factor in the winter season
as ``Excess Energy.'' If the current 24-Month Study generation
projection for a year exceeds the result of the capacity factor
calculation described above, energy exceeding that calculation (Excess
Energy) would be distributed to all contractors and PUP recipients
based on a pro rata share of their seasonal CROD. Excess Energy will be
distributed to contractors monthly and included as an addition to each
contractor's Quarterly Energy. Excess Energy would be subject to the
same rate and payment requirements as other available P-DP hydropower.
The 24-Month Study yearly projections could show Excess Energy at the
beginning of a year, but such Excess Energy may not remain at
originally projected levels for the full year. Excess Energy
distributed in part of a year may be subject to adjustment in
subsequent months if the 24-Month Study yearly generation projection
drops below the Excess Energy threshold later that year. WAPA would
establish procedures for designating and adjusting Excess Energy in
Metering and Scheduling Instructions (MSI), which would be incorporated
into the electric service contracts, to minimize subsequent energy
adjustments as much as possible.
WAPA also is proposing an option that would allow contractors to
use transmission capacity, reserved for delivery of their P-DP FES
allocation, for contractor-owned or -purchased resources. Transmission
capacity used for such energy could not exceed a contractor's CROD.
III. Proposed Resource Extensions and Resource Pool Allocations
On September 30, 2028, WAPA's long-term sales contracts for P-DP
power will expire. As part of its Proposed 2028 Plan, WAPA proposes to
apply the principles of the PMI (10 CFR 905.30 through 905.37) to P-DP
for the forthcoming marketing period. This includes a proposal to
extend 98 percent of P-DP contractors' existing CROD, as of September
30, 2028, for an additional 20 years, from October 1, 2028, through
September 30, 2048. The existing CROD for PUP contractors will remain
unchanged. WAPA proposes that a resource pool of two percent of
available P-DP capacity (CROD) be established for new allottees. Energy
associated
[[Page 43845]]
with the new resource pool would be based on a pro rata share of the
allottee's seasonal CROD and published in the form of Quarterly Energy.
WAPA proposes creation of a single, one-time resource pool of a
definite size, given the small size of the P-DP resource relative to
those of other WAPA projects and the substantial costs and effort
associated with creation of incremental resource pools. Specific terms
and conditions governing the extensions and resource pool are described
below.
A. Extension for Existing Contractors
WAPA proposes to have at least 259,206 kW or marketable capacity in
the summer and at least 198,337 kW of marketable capacity in the
winter, beginning October 1, 2028. WAPA expects the addition of 3,750
kW of capacity resulting from the rewind of Davis Dam Unit 5,
anticipated to be available in July 2025 or earlier. With the addition
of 3,750 kW, WAPA would have 262,956 kW of marketable capacity in the
summer and 202,087 kW of marketable capacity in the winter. The actual
marketable capacity for the forthcoming marketing period will be
identified in the Final 2028 Plan. Consistent with 10 CFR 905.32(e)(2),
WAPA intends to retain the capacity increase associated with the Davis
Dam rewind effort through the end of the current marketing period to
enhance operational flexibility.
WAPA proposes to extend existing contractors' allocations using the
formula contained in the PMI: ``Customer Contract Rate of Delivery
(CROD) today/total project CROD under contract today x project-specific
percentage x marketable resource determined to be available at the time
future resource extensions begin = CROD extended'' (10 CFR 905.33(a)).
After adjusting each contractor's CROD by applying the increase in
marketable capacity and then reducing the adjusted CROD by two percent
(the amount of the proposed resource pool), the net effect to each
contractor's current CROD would be a reduction of approximately 0.6
percent in the summer and 0.2 percent in the winter. Reductions would
be mitigated if additional capacity gains are achieved prior to October
1, 2028. The creation of a resource pool would not affect PUP
customers' CROD.
In the event any existing contractors forfeit or express an
intention not to extend some or all of their allocations prior to
October 1, 2028, such resources will be returned to the other existing
contractors on a pro rata basis.
B. Resource Pool Allocations
WAPA proposes to establish a resource pool by reserving a portion
of the power available during the forthcoming marketing period for
allocation to new, eligible preference entities, or returned to
existing contractors if enough new preference customers are not found.
Allocations for the resource pool would be determined through a
separate public process.
The 2028 resource pool would consist of two percent of the power
resources available beginning October 1, 2028. The two-percent
reduction to the adjusted allocations of existing contractors
(described in Part III.A) would create a resource pool of approximately
5,259 kW of summer capacity and 4,041 kW of winter capacity. The new
resource pool would include approximately 748 kW of summer withdrawable
capacity and 146 kW of winter withdrawable capacity.
When reducing existing allocations to create the resource pool,
WAPA would first take energy from existing contractors' withdrawable
allocations up to the total reduction, when available. The remaining
reductions would come from nonwithdrawable energy.
C. Eligibility Criteria for Resource Pool Allocations
WAPA proposes to apply the following Eligibility Criteria to all
applicants seeking a resource pool allocation under the new marketing
plan.
1. Qualified applicants must meet the preference requirements under
Section 9(c) of the Reclamation Project Act of 1939 (43 U.S.C. 485(c)),
as amended and supplemented.
2. Qualified applicants will be located within the P-DP marketing
area that includes: (1) all of the drainage area considered tributary
to the Colorado River below a point one mile downstream from the mouth
of the Paria River (Lees Ferry); (2) the State of Arizona, excluding
that portion lying in the Upper Colorado River Basin; (3) that portion
of the State of New Mexico lying in the Lower Colorado River Basin and
the independent Quemada Basin lying north of the San Francisco River
drainage area; (4) those portions of the State of California lying in
the Lower Colorado River Basin and in drainage basins of all streams
draining into the Pacific Ocean south of Calleguas Creek; and (5) those
parts of the States of California and Nevada in the Lahontan Basin
including and lying south of the drainages of Mono Lake, Adobe Meadows,
Owens Lake, Amargosa River, Dry Lakes, and all closed independent
basins or other areas in southern Arizona not tributary to the Colorado
River.
3. Qualified applicants must not have an existing allocation of
Federal power or be a member of a parent entity that has an allocation
of Federal power.
4. Qualified applicants, except Native American tribes, must be
ready, willing, and able to receive and distribute or use power from
WAPA. Ready, willing, and able means that the potential allottee has
the facilities needed for the receipt of power or has made the
necessary arrangements for transmission and/or distribution service;
and the potential allottee's power supply contracts with third parties
permit the delivery of WAPA power.
5. Qualified applicants that desire to purchase power from WAPA for
resale to consumers, including cooperatives, public utility districts,
public power districts and municipalities, must achieve electric
utility status and have necessary arrangements for transmission and/or
distribution service in place by January 31, 2028. Native American
tribes are not subject to this requirement. Electric utility status
means the applicant has responsibility to meet load growth, has a
distribution system, and is ready, willing, and able to purchase P-DP
Federal power from WAPA on a wholesale basis for resale to retail
customers.
6. Qualified Native American applicants must be a Native American
tribe as defined in the Indian Self Determination Act of 1975 (25
U.S.C. 5301 et seq., as amended or supplemented).
7. Qualified applicants must apply in response to the Call for
Resource Pool Applications issued by WAPA in a separate Federal
Register notice. The notice will include the deadline for receipt of
those applications.
D. Allocation Criteria for Resource Pool Allocations
WAPA proposes to apply the following Allocation Criteria to all
applicants seeking a resource pool allocation under the new marketing
plan.
1. Allocations will be made in amounts as determined solely by WAPA
in exercise of its discretion consistent with its governing authorities
and considered to be in the best interest of the United States.
2. Allocations will be based on the applicant's load during the
calendar year prior to the Call for Resource Pool Applications or the
amount requested, whichever is less.
[[Page 43846]]
3. WAPA will base allocations made to Native American tribes on the
actual load experienced during the calendar year prior to the Call for
Resource Pool Applications or the amount requested, whichever is less.
WAPA may use estimated load values if actual load data is not
available. WAPA will review and adjust, where necessary, inaccurate
estimates received during the allocation process.
4. WAPA will consider allocations below 1,000 kW. As part of the
2008 resource pool, WAPA set forth a 1,000 kW minimum for new
allocations given operational constraints in scheduling. However, with
rounding tools now available, WAPA will be able to ensure that CROD is
not exceeded.
5. Qualified applicants seeking an allocation as an aggregated
group must demonstrate to WAPA's satisfaction the existence of a
contractual aggregation arrangement prior to WAPA's notice of final
allocations. Members of an aggregated group must individually and
collectively meet preference status and all other eligibility
requirements. Qualified applicants aggregating their loads will be
required to enter into a single firm power contract with WAPA, with the
aggregated group entity as the contracting Party.
6. An allottee will have the right to purchase power from WAPA only
upon execution of an electric service contract between WAPA and the
allottee, and satisfaction of all conditions in that contract.
IV. General Criteria and Contract Principles
WAPA proposes to apply the following criteria and contract
principles to all contracts executed under the new marketing plan:
A. Electric service contracts shall be executed no later than May
31, 2028, unless otherwise agreed to in writing by WAPA.
B. Contracts will include clauses specifying criteria that
contractors must meet on a continuous basis to be eligible to receive
electric service from WAPA.
C. All power supplied by WAPA will be delivered pursuant to MSI,
which will be part of contractors' electric service contracts.
D. Contracts shall provide for WAPA to furnish electric service
effective October 1, 2028, through September 30, 2048.
E. Contracts shall incorporate WAPA's standard provisions for
electric service contracts, integrated resource plans, and General
Power Contract Provisions, as determined by WAPA.
F. WAPA proposes a new minimum scheduling requirement that aligns
with Reclamation's generation schedule and how energy is scheduled
within the Western Interconnection.\8\ WAPA intends for contractors to
receive the maximum benefit of their resource allocations while
accommodating the following goals: meeting Reclamation's water
requirements; reducing purchase power and wheeling costs; and
minimizing sales of energy in low load hours. WAPA would develop a tool
that uses Reclamation's 24-Month Study data, the status of generators,
water volumes and elevation, reduced water releases, hourly pricing and
projected hourly load, and other relevant information to model and
produce an optimized monthly capacity and monthly minimum energy
requirement for each contractor. During the public process and prior to
the execution of contracts for the 2028-2048 marketing period, WAPA
would provide examples of methods being considered, seek feedback from
existing contractors and potential new allottees, and select which
option provides the greatest flexibility and achieves the goals
identified in this notice. Minimum scheduling requirements will be
included in the MSI.
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\8\ This proposal would eliminate the current P-DP marketing
plan criterion that all power contractors be required to schedule a
minimum rate of delivery during off peak load hours (See 49 FR
50852, 50585). The Conformed Criteria and existing contracts
specifically provide that the number of kilowatt hours to be taken
during off peak load hours at the minimum rate of delivery will not
exceed 25% of the contractor's monthly energy entitlement (Id.).
Scheduling trends no longer follow the traditional on/off peak
hours, due to changes in load demand. Furthermore, the availability
and integration of renewable energy resources, such as wind and
solar during certain hours of the day, are also now competing with
hydropower generation.
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G. WAPA may, as it deems reasonable and necessary, enter into other
agreements such as: transmission service agreements, interchange
agreements, reserve agreements, load regulation agreements, exchange
agreements, maintenance and emergency service agreements, power pooling
agreements, or other transactions.
H. P-DP will remain operationally integrated with the Boulder
Canyon Project, subject to applicable operational restraints of the
Bureau of Reclamation, applicable laws, and the other requirements of
the marketing plan.
I. WAPA, at its discretion and sole determination, reserves the
right to adjust the CROD on five years' written notice in response to
changes in hydrology and river operations. Such adjustments will take
place only after WAPA conducts a public process.
J. Renewable energy certificates associated with P-DP power will be
made available to contractors and may be sold or transferred to third
parties, provided such sale or transfer is consistent with WAPA policy
and documented in electric service contracts.
K. Each entity is ultimately responsible for obtaining its own
delivery or other arrangements to its load. Transmission service over
the P-DP system will be provided in accordance with Part V of this
Proposed 2028 Plan.
L. WAPA may develop rate schedules for services provided under the
Proposed 2028 Plan. Such rates will be developed through a separate
public process.
M. Contractors must pay all applicable rates and charges in the
manner and within the time prescribed in the contract.
N. P-DP will remain financially segregated for the purposes of
accounting and project repayment. Beginning June 1, 2005, and until the
end of the repayment period for the Central Arizona Project, P-DP
provides for surplus revenues by including the equivalent of 4 \1/2\
mills per kWh in the rates charged to contractors in Arizona and by
including the equivalent of 2 \1/2\ mills per kWh in the rates charged
to contractors in California and Nevada. After the repayment period for
the Central Arizona Project, the equivalent of 2 \1/2\ mills per kWh
shall be included in the rate charged to all contractors in Arizona,
Nevada, and California.
O. Consistent with the current P-DP Advancement of Funds contract,
new allottees would be required to reimburse existing contractors for
undepreciated replacement advances, to the extent existing contractors'
allocations are reduced as a result of creating the resource pool. New
allottees who receive an allocation would be required to prepay for
service according to the applicable rate schedule and may participate
in advance funding of WAPA's and Reclamation's operation and
maintenance expenses, consistent with the existing Advancement of Funds
contract, or an updated version of the contract that addresses the
status of P-DP, as appropriate.
P. Deficits for costs incurred during a previous marketing period
would not be passed through to new allottees.
V. Transmission Service
P-DP power will be delivered to designated points of delivery on
WAPA's P-DP transmission system. Contractors must secure all necessary
transmission service to deliver Federal
[[Page 43847]]
power beyond WAPA's P-DP transmission system. WAPA may assist new
contractors in obtaining third-party transmission arrangements for
delivery of firm power allocated during the forthcoming marketing
period. WAPA will determine the use of its transmission resources
concurrently with further development of the products and services
under this Proposed 2028 Plan. A list of designated delivery points
will be provided with the Call for Resource Pool Applications. WAPA
will market surplus transmission capacity on P-DP under WAPA's Open
Access Transmission Tariff and other applicable arrangements.
Legal Authorities
WAPA developed this Proposed 2028 Plan in accordance with its power
marketing authorities pursuant to the Department of Energy Organization
Act (42 U.S.C. 7101, et seq.); the Reclamation Act of June 17, 1902 (32
Stat. 388), as amended and supplemented by subsequent enactments,
particularly section 9(c) of the Reclamation Project Act of 1939 (43
U.S.C. 485(c)); and other acts specifically applicable to P-DP.
Procedural Requirements
Review Under the Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1980 (44 U.S.C.
3501, et seq.), WAPA has received approval from the Office of
Management and Budget for the collection of customer information under
control number 1910-5136.
Environmental Compliance
WAPA has determined this action fits within the following
categorical exclusions listed in appendix B to subpart D of 10 CFR part
1021: B4.1 (Contracts, policies, and marketing and allocation plans for
electric power) and B4.4 (Power marketing services and activities).
Categorically excluded projects and activities do not require
preparation of either an environmental impact statement or an
environmental assessment.\9\A copy of the categorical exclusion
determination is available on WAPA's website under the 2024 accordion
menu at <a href="http://www.wapa.gov/about-wapa/regions/dsw/environment">www.wapa.gov/about-wapa/regions/dsw/environment</a>.
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\9\ The determination was done in compliance with NEPA (42
U.S.C. 4321-4347); the Council on Environmental Quality Regulations
for implementing NEPA (40 CFR parts 1500-1508); and DOE NEPA
Implementing Procedures and Guidelines (10 CFR part 1021).
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Determination Under Executive Order 12866
WAPA 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.
Signing Authority
This document of the Department of Energy was signed on May 13,
2024, by Tracey A. LeBeau, Administrator, Western Area Power
Administration. 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 May 15, 2024.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2024-10997 Filed 5-17-24; 8:45 am]
BILLING CODE 6450-01-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.