Notice2024-30862
Loveland Area Projects-Rate Order No. WAPA-219
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
December 27, 2024
Issuing agencies
Energy DepartmentWestern Area Power Administration
Abstract
The Rocky Mountain (RM) region of the Western Area Power Administration (WAPA) proposes new formula rates for the Loveland Area Projects (LAP) transmission and ancillary services for RM's costs to be recovered under the Southwest Power Pool's (SPP) Open Access Transmission Tariff (Tariff) should RM decide to become a member of SPP. The proposed formula rates will become effective on the latter of RM's membership date or the go-live date of the expansion of the SPP Regional Transmission Organization (RTO) into the Western Interconnection (scheduled for April 1, 2026, as of the date of this notice) and will remain in effect for five years from the effective date, which with an effective date of April 1, 2026, will be March 31, 2031, or until superseded.
Full Text
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<title>Federal Register, Volume 89 Issue 248 (Friday, December 27, 2024)</title>
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[Federal Register Volume 89, Number 248 (Friday, December 27, 2024)]
[Notices]
[Pages 105564-105567]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-30862]
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DEPARTMENT OF ENERGY
Western Area Power Administration
Loveland Area Projects--Rate Order No. WAPA-219
AGENCY: Western Area Power Administration, DOE.
ACTION: Notice of proposed transmission and ancillary services formula
rates.
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SUMMARY: The Rocky Mountain (RM) region of the Western Area Power
Administration (WAPA) proposes new formula rates for the Loveland Area
Projects (LAP) transmission and ancillary services for RM's costs to be
recovered under the Southwest Power Pool's (SPP) Open Access
Transmission Tariff (Tariff) should RM decide to become a member of
SPP. The proposed formula rates will become effective on the latter of
RM's membership date or the go-live date of the expansion of the SPP
Regional Transmission Organization (RTO) into the Western
Interconnection (scheduled for April 1, 2026, as of the date of this
notice) and will remain in effect for five years from the effective
date, which with an effective date of April 1, 2026, will be March 31,
2031, or until superseded.
DATES: A consultation and comment period will begin December 27, 2024
and end March 27, 2025. RM will present a detailed explanation of the
proposed formula rates and other modifications at a public information
forum that will be held on February 19, 2025, at 11 a.m. MST to no
later than 12 noon MST. RM will also host a public comment forum on
February 19, 2025, at 12:15 p.m. MST to no later than 1 p.m. MST. The
public information forum and the public comment forum will be conducted
virtually. Instructions for participating in the forums will be posted
on RM's Rates website at least 14 days prior to the public information
and comment forums at:<a href="http://www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs">www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs</a>.
RM will accept comments any time during the consultation and
comment period.
ADDRESSES: Written comments and requests to be informed of Federal
Energy Regulatory Commission (FERC) actions concerning the proposed
formula rates submitted by WAPA to FERC for approval should be sent to:
Barton V. Barnhart, Regional Manager, Rocky Mountain Region, Western
Area Power Administration, 5555 East Crossroads Boulevard, Loveland, CO
80538-8986, or email <a href="/cdn-cgi/l/email-protection#afe3eefffbddcec1dceecbc5efd8cedfce81c8c0d9"><span class="__cf_email__" data-cfemail="7d313c2d290f1c130e3c19173d0a1c0d1c531a120b">[email protected]</span></a>. RM will post information
about the proposed formula rates and
[[Page 105565]]
written comments received to its Rates website at: <a href="http://www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs">www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs</a>
FOR FURTHER INFORMATION CONTACT: Sheila D. Cook, Rates Manager, Rocky
Mountain Region, Western Area Power Administration, (970) 685-9562 or
email: <a href="/cdn-cgi/l/email-protection#84f7e7ebebefc4f3e5f4e5aae3ebf2"><span class="__cf_email__" data-cfemail="0477676b6b6f44736574652a636b72">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: On April 28, 2023, WAPA published a Federal
Register notice titled ``Recommendation for the Western Area Power
Administration's Rocky Mountain Region and Colorado River Storage
Project Management Center to Pursue Final Negotiations Regarding
Membership in the Southwest Power Pool Regional Transmission
Organization, and for the Upper Great Plains Region to Expand its
Participation'' (88 FR 26298). On June 4, 2024, SPP submitted revisions
to its Tariff, Bylaws, and Membership Agreement to expand the SPP RTO
into the Western Interconnection to FERC.\1\ If SPP succeeds in
obtaining FERC's approval of its Tariff, Bylaws, and Membership
Agreement revisions, and upon further approval by the Administrator, RM
plans to become a member of SPP.\2\
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\1\ Southwest Power Pool, Inc., Submission of Revisions to
Tariff, Bylaws, and Membership Agreement to Expand the Regional
Transmission Organization into the Western Interconnections (Part 1
of 2) and (Part 2 of 2), Docket Nos. ER24-2184, ER24-2185 (June 4,
2024).
\2\ WAPA's Colorado River Storage Project Management Center also
plans to become a member of the SPP RTO, and WAPA's Upper Great
Plains region plans to expand membership participation in the SPP
RTO. These regions are proposing new formula rate designs/rate
schedules under separate Rate Order Nos. WAPA-220 and WAPA-218,
respectively.
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RM's membership will include RM becoming a Transmission Owner
member of SPP and SPP assuming the balancing authority (BA)
responsibilities for RM's Western Area Colorado Missouri (WACM) BA
area. WAPA will transfer functional control of eligible LAP
transmission facilities to SPP. At such time, LAP transmission and
ancillary services and WACM BA ancillary services will no longer be
available under WAPA's Tariff, and RM's BA contracts and the existing
transmission and ancillary services rate schedules, specifically L-NT1,
L-FPT1, L-NFPT1, L-UU1, L-AS1, L-AS2, L-AS3, L-AS4, L-AS5, L-AS6, L-
AS7, and L-AS9, will no longer be applicable.
LAP transmission service will be provided under the SPP Tariff by
SPP as the transmission service provider. Accordingly, RM will need to
have new rate designs/rate schedules and rate implementation protocols
in place for specific costs to be recovered under the SPP Tariff.
As of the date of this notice, SPP's anticipated deadline for
filing certain SPP Tariff documents for RM (including annual revenue
requirements (ARR), formula rate templates, and formula rate
implementation protocols proposed in this rate filing, as well as other
pertinent documents not included in this rate filing) with FERC is
October 2025. RM is publishing this notice of proposed formula rates
and initiating the rate consultation and comment period at this time in
order for RM to obtain FERC-approved formula rates prior to this SPP
deadline.
If RM does not become a member of SPP, further actions under this
notice of proposed rates will be canceled, and existing formula rates
will remain in effect. If canceled, RM will inform customers by letter
and by posting notice of such on RM's Rates website (<a href="http://www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs">www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs</a>) and will withdraw the formula rates proposed in this notice.
RM is proposing a new formula rate to calculate the ARRs for its
LAP transmission facilities located in both the Eastern and Western
Interconnections and for its Virginia Smith Converter Station (Sidney
DC Tie) that will be transferred to the functional control of SPP under
the SPP Tariff. RM is also proposing a new formula rate to calculate
the Sidney DC Tie Incremental Market Efficiency Use \3\ (Incremental
MEU) share. RM is proposing a new formula rate to calculate the ARR for
Scheduling, System Control, and Dispatch Service (SSCD Service) under
the SPP Tariff. RM's revenue requirements will be added to the annual
revenue requirements of other transmission owners in the SPP pricing
Zone 104, also identified as the Loveland Area Projects Zone (LAPZ),
for transmission service billed by SPP within the LAPZ. RM's revenue
requirements under these proposed rates will also impact other costs
for transmission service within the broader SPP footprint. For
transmission and ancillary services provided under the SPP Tariff, RM
also proposes to provide information related to RM's rate
implementation and annual updates in ``Formula Rate Implementation
Protocols'' (Protocols). Each of these topics is described in more
detail below.
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\3\ ``Incremental Market Efficiency Use (Incremental MEU)
Charge: A market recovery mechanism to compensate West DC Tie
Transmission Owners for the expected loss of life of certain West DC
Tie facilities due to increased utilization of the West DC Ties by
the Integrated Marketplace.'' (SPP Proposed Tariff at Part I,
Section 1, I Definitions.)
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The proposed formula rates will provide sufficient revenue to
recover annual operation, maintenance, replacement, and interest
expense while ensuring repayment of the project within the cost
recovery criteria set forth in Department of Energy (DOE) Order
RA6120.2. For more specific information on the proposed formula rates,
please see the customer rate brochure located on RM's Rates website at:
<a href="http://www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs">www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs</a>.
Proposed Transmission Formula Rate
For transmission service provided by SPP under SPP's Tariff, under
Rate Schedule LAPT-ATRR, RM proposes to provide its overall LAP annual
transmission revenue requirement (ATRR) as separate subtotals to
distinguish LAP transmission facilities separately between Western
Interconnection, Eastern Interconnection, Sidney DC Tie (for use by SPP
in assessing the DC Tie Access Charge \4\ to transmission service
customers proposed in the SPP filing to FERC for the RTO expansion),
and other SPP zones. SPP will utilize these LAP ATRR subtotals, along
with zonal and regional load and other applicable information, to
calculate the applicable charges and revenue distribution for SPP
transmission service under the SPP Tariff.
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\4\ ``DC Tie Access Charge: A charge on a transmission
reservation utilizing a West DC Tie that sinks outside of the Zone
where the West DC Tie is located. The Transmission Customer shall be
responsible for DC Tie Access Charge determined in accordance with
Schedule 14.'' (SPP Proposed Tariff at Part I, Section 1, D
Definitions.)
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Consistent with RM's current transmission formula rates, RM
proposes to continue recovering transmission-related expenses and
investments on a forward-looking basis by using projections to estimate
transmission costs for the upcoming year, with a true-up of incurred
costs in a subsequent year. Transmission-related annual costs include
operation and maintenance, administrative and general costs, interest,
and depreciation. The annual costs will be reduced by applicable
revenue credits received by RM under the SPP Tariff.
Revenue requirement data will be submitted to SPP in standard
formula rate templates with costs classified as either ``Zonal'' or
``Regional,'' applying the definitions in the SPP Tariff. ``Zonal''
costs are those that meet certain criteria and are recovered within
[[Page 105566]]
the local pricing zone, while ``Regional'' costs are those meeting
certain criteria eligible to be recovered across SPP's applicable West
or East BA area, dependent upon where the transmission upgrade is
located. The Formula Rate Template for the LAP ATRR and related
information will be posted on RM's LAPT Open Access Same-Time
Information System (OASIS) website (<a href="http://www.oasis.oati.com/LAPT/index.html">www.oasis.oati.com/LAPT/index.html</a>), on RM's Rates website (<a href="http://www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs">www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs</a>), and on SPP's
Member Related Postings website(<a href="http://opsportal.spp.org/OASIS/Directory/Member%20Related%20Postings">opsportal.spp.org/OASIS/Directory/Member%20Related%20Postings</a>).
Proposed Sidney DC Tie Incremental Market Efficiency Use Formula Rate
In its FERC filing for the proposed expansion of the RTO into the
Western Interconnection, SPP proposes to expand its Integrated
Marketplace across the seam between the Eastern and Western
Interconnections by including the West DC Ties \5\ into the Integrated
Marketplace 5-minute market dispatch. To enable this market dispatch
between the Eastern and Western Interconnections, SPP included a new
Section 8.11 to Attachment AE of the SPP Tariff for the calculation of
the Incremental MEU amounts. The Incremental MEU compensates each West
DC Tie Transmission Owner for the expected loss of life of that owner's
West DC Tie facility due to increased utilization of the West DC Ties
by the Integrated Marketplace.
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\5\ ``West DC Ties: A direct current interconnection between the
Eastern Interconnection and Western Interconnection for which the DC
Tie Access Charge and the Incremental Market Efficiency Use Charge
may be applicable. In the Integrated Marketplace, the West DC Ties
will be Non-Biddable Locations that will be used in the settlements
in the TCR [Transmission Congestion Rights] Markets. The West DC
Ties are Miles City, Stegall, or Sidney.'' (SPP Proposed Tariff at
Part I, Section W Definitions.)
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For SPP to compensate RM as a West DC Tie Transmission Owner of the
Sidney DC Tie for Incremental MEU under SPP's Tariff, RM proposes to
provide its Sidney DC Tie Incremental MEU share under Rate Schedule
LAPT-DCTIE-IMEU. SPP will utilize this Sidney DC Tie Incremental MEU
share along with other applicable information to calculate the amount
to be paid to RM for the expected loss of life of certain Sidney DC Tie
facilities due to increased utilization of those West DC Tie facilities
by SPP in the Integrated Marketplace.
To simplify the calculation of the Incremental MEU and provide a
consistent forward-looking known amount to be included in the market
uplift, a loss-of-life will be estimated for each eligible group of
West DC Tie equipment due to expected market operation impacts, and a
levelized annual estimate will be provided to SPP. The loss-of-life
calculations will be based upon pre-defined impact metrics directly
related to the increased market use for each of the West DC Tie
equipment groups eligible for cost recovery. Revenue received from SPP
for RM's Sidney DC Tie Incremental MEU share will be credited against
the Sidney DC Tie portion of the LAP ATRR described above.
The Sidney DC Tie Incremental MEU share data will be submitted to
SPP in a standard formula rate template in accordance with the SPP
Tariff Attachment AE. The Formula Rate Template for the Sidney DC Tie
Incremental MEU share will be posted on RM's LAPT OASIS website, on
RM's Rates website, and on SPP's Member Related Postings website (see
web addresses listed previously).
Proposed Formula Rate for Scheduling, System Control, and Dispatch
Service
SSCD Service is required to operate a Transmission Owner's SPP
Tariff facilities and schedule movement of power through, out of,
within, or into one or both of the SPP BA areas and certain parts of
the transmission system not located within a SPP BA area. Under this
proposal, RM's ARR for SSCD Service, under Rate Schedule LAPT-AS1, will
be submitted to SPP in a standard formula rate template for inclusion
in the SPP Tariff Schedule 1. The SSCD Service ARR will be used by SPP
to determine the regional SPP Schedule 1 rate and revenue distribution
for SPP through-and-out transactions and to determine the zonal SPP
Schedule 1 rate and revenue distribution for the LAPZ under the SPP
Tariff.
For consistency with the LAP ATRR proposal, RM proposes a formula-
based rate methodology to calculate its SSCD Service ARR on a forward-
looking basis by using projections to estimate costs associated with
SSCD Service for the upcoming year, with a true-up of incurred costs in
a subsequent year. RM's SSCD Service ARR will be derived by calculating
RM's applicable annual costs associated with the provision of SSCD
Service, including operation and maintenance, administrative and
general, interest, and depreciation. The annual costs will be reduced
by any applicable revenue received by RM under the SPP Tariff. The
Formula Rate Template for the SSCD Service and related information will
be posted on RM's LAPT OASIS website, on RM's Rates website, and on
SPP's Member Related Postings website (see web addresses listed
previously).
Formula Rate Implementation Protocols
For transmission service provided by SPP under SPP's Tariff, RM
proposes to provide information relating to RM's rate implementation
and annual update procedures and timelines in ``Formula Rate
Implementation Protocols'' (Protocols). The Protocols, together with
the above-mentioned formula rate templates, comprise the Formula Rates
that will be submitted to SPP to be incorporated in the SPP Tariff. All
relevant information pertaining to RM's annual updates, customer
notifications and review periods, and meetings will be contained in the
Protocols. The Protocols will be posted on RM's LAPT OASIS website, on
RM's Rates website, and on SPP's Member Related Postings website (see
web addresses listed previously).
Legal Authority
DOE procedures for public participation in power and transmission
rate adjustments are located at 10 CFR part 903. The proposed action is
a major rate adjustment, as defined by 10 CFR 903.2(d). In accordance
with 10 CFR 903.15(a) and 10 CFR 903.16(a), RM will hold public
information and public comment forums for this rate adjustment. RM will
review and consider all timely public comments at the conclusion of the
consultation and comment period and adjust the proposal as appropriate.
The rates will then be approved on an interim basis.
WAPA is establishing the formula rates for LAP in accordance with
section 302 of the DOE Organization Act (42 U.S.C. 7152).\6\
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\6\ This Act transferred to, and vested in, the Secretary of
Energy the power marketing functions of the Secretary of the
Department of the Interior and the Bureau of Reclamation
(Reclamation) under the Reclamation Act of 1902 (ch. 1093, 32 Stat.
388), as amended and supplemented by subsequent laws, particularly
section 9(c) of the Reclamation Project Act of 1939 (43 U.S.C.
485h(c)) and section 5 of the Flood Control Act of 1944 (16 U.S.C.
825s); and other acts that specifically apply to the projects
involved.
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By Delegation Order No. S1-DEL-RATES-2016, effective November 19,
2016, the Secretary of Energy delegated: (1) the authority to develop
power and transmission rates to the WAPA Administrator; (2) the
authority to confirm, approve, and place such rates into effect on an
interim basis to the Deputy Secretary of Energy; and (3) the authority
to confirm, approve, and place into effect on a final basis, or to
remand
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or disapprove such rates, to FERC. By Delegation Order No. S1-DEL-S3-
2024, effective August 30, 2024, the Secretary of Energy also delegated
the authority to confirm, approve, and place such rates into effect on
an interim basis to the Under Secretary for Infrastructure. By
Redelegation Order No. S3-DEL-WAPA1-2023, effective April 10, 2023, the
Under Secretary for Infrastructure further redelegated the authority to
confirm, approve, and place such rates into effect on an interim basis
to WAPA's Administrator.
Availability of Information
All brochures, studies, comments, letters, memorandums, or other
documents that RM initiates or uses to develop the proposed formula
rates are available for inspection and copying at the Rocky Mountain
Regional office located at 5555 East Crossroads Boulevard, Loveland,
Colorado. Many of these documents and supporting information are also
available on RM's Rates website at: <a href="http://www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs">www.wapa.gov/about-wapa/regions/rm/rm-rates/2026-rate-adjustment-rto-trans-and-anc-svcs</a>.
Ratemaking Procedure Requirements
Environmental Compliance
WAPA is in the process of determining whether an environmental
assessment or an environmental impact statement should be prepared or
if this action can be categorically excluded from those
requirements.\7\
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\7\ In compliance with the National Environmental Policy Act
(NEPA) of 1969, as amended, 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 December
19, 2024, by Tracey A. LeBeau, Administrator, Western Area Power
Administration, pursuant to delegated authority from the Secretary of
Energy. That 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 December 19, 2024.
Jennifer Hartzell,
Alternate Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2024-30862 Filed 12-26-24; 8:45 am]
BILLING CODE 6450-01-P
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