Notice2025-08617
Proposed Rate Adjustment, Proposed Adjustment to True-Up Mechanism, Public Forum, and Opportunities for Public Review and Comment for Kerr-Philpott System
Primary source
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Published
May 15, 2025
Issuing agencies
Energy DepartmentSoutheastern Power Administration
Abstract
Southeastern Power Administration (Southeastern or SEPA) proposes to revise existing schedules of rates and charges applicable to the sale of power from the Kerr-Philpott System effective for a 5- year period, from October 1, 2025, through September 30, 2030. Opportunities will be available for interested persons to review the present rates and the proposed rates, supporting studies, to participate in a public forum and to submit written comments. Southeastern will evaluate all comments received in this process.
Full Text
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<title>Federal Register, Volume 90 Issue 93 (Thursday, May 15, 2025)</title>
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[Federal Register Volume 90, Number 93 (Thursday, May 15, 2025)]
[Notices]
[Pages 20669-20671]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-08617]
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DEPARTMENT OF ENERGY
Southeastern Power Administration
Proposed Rate Adjustment, Proposed Adjustment to True-Up
Mechanism, Public Forum, and Opportunities for Public Review and
Comment for Kerr-Philpott System
AGENCY: Southeastern Power Administration, Department of Energy (DOE).
ACTION: Notice of proposed rate and true-up mechanism adjustment.
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SUMMARY: Southeastern Power Administration (Southeastern or SEPA)
proposes to revise existing schedules of rates and charges applicable
to the sale of power from the Kerr-Philpott System effective for a 5-
year period, from October 1, 2025, through September 30, 2030.
Opportunities will be available for interested persons to review the
present rates and the proposed rates, supporting studies, to
participate in a public forum and to submit written comments.
Southeastern will evaluate all comments received in this process.
DATES: Written comments are due on or before August 13, 2025. A public
information and comment forum will be held in-person at Southeastern
Power Administration, 1166 Athens Tech Road, Elberton, Georgia, at 10
a.m. EDT on June 17, 2025. There will also be an option to attend the
forum virtually via Microsoft Teams. Persons desiring to attend the
forum should notify Southeastern by June 16, 2025, so a list of forum
participants can be prepared. Persons desiring to speak at the forum
should specify this in their notification to Southeastern; others may
speak if time permits. Notifications should be submitted by email to
<a href="/cdn-cgi/l/email-protection#6f2c0002020a011b1c2f1c0a1f0e410b000a41080019"><span class="__cf_email__" data-cfemail="8fcce0e2e2eae1fbfccffceaffeea1ebe0eaa1e8e0f9">[email protected]</span></a>. If Southeastern has not been notified by close
of business on June 16, 2025, that at least one person intends to be
present at the forum, either in-person or virtually, the forum may be
canceled with no further notice.
ADDRESSES: Written comments should be submitted to: Administrator,
Southeastern Power Administration, Department of Energy, 1166 Athens
Tech Road, Elberton, Georgia 30635-6711; Email: <a href="/cdn-cgi/l/email-protection#6d2e0200000803191e2d1e081d0c43090208430a021b"><span class="__cf_email__" data-cfemail="55163a3838303b212615263025347b313a307b323a23">[email protected]</span></a>.
The URL and call in information for the public information and comment
forum is as follows: <a href="https://bit.ly/Kerr-PhilpottRateForum2025">https://bit.ly/Kerr-PhilpottRateForum2025</a>; +1
(404) 796-9216, Access Code: 927891434#.
FOR FURTHER INFORMATION CONTACT: Alexa Webb, Acting Power Marketing
Advisor, Southeastern Power Administration, Department of Energy, 1166
Athens Tech Road, Elberton,
[[Page 20670]]
Georgia 30635-6711, (706) 213-3800; Email: <a href="/cdn-cgi/l/email-protection#43022f263b226d1426212103302633226d272c266d242c35"><span class="__cf_email__" data-cfemail="753419100d145b2210171735061005145b111a105b121a03">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: The Federal Energy Regulatory Commission
(FERC) confirmed and approved on a final basis, Wholesale Power Rate
Schedules VA-1-D, VA-2-D, VA-3-D, VA-4-D, DEP-1-D, DEP-2-D, DEP-3-D,
DEP-4-D, AP-1-D, AP-2-D, AP-3-D, AP-4-D, NC-1-D, and Replacement-2-C,
applicable to Kerr-Philpott System for a period ending September 30,
2025. (FERC Docket No. EF20-5-000 (Dec. 11, 2020)).
Discussion: Existing rate schedules are predicated upon a February
2020 repayment study and other supporting data. The annual revenue
requirement in this study was $31,800,000 per year. An updated
repayment study, dated March 2025, indicates rates are not adequate to
recover cost increases identified and therefore do not meet repayment
criteria. The revised repayment study demonstrates an annual revenue
requirement increase to $43,000,000 per year will meet repayment
criteria. The increase in the annual revenue requirement is $11,200,000
per year, or 35.22 percent.
The existing rate schedules include an annual true-up mechanism for
the capacity and energy rates based on the variance of the actual net
revenue available for repayment from the planned net revenue available
for repayment. The adjustment is for every $100,000 under-recovery of
the planned net revenue available for repayment. The base capacity
charge is increased by $0.02 per kilowatt per month, up to a maximum of
$0.75 per kilowatt per month, and the base energy charge is increased
by 0.10 mills per kilowatt-hour, up to a maximum of 3.0 mills per
kilowatt-hour. For every $100,000 over-recovery of the planned net
revenue available for repayment, the base capacity charge is reduced by
$0.02 per kilowatt per month, up to a maximum of $0.75 per kilowatt per
month, and the base energy charge is reduced by 0.10 mills per
kilowatt-hour, up to a maximum of 3.0 mills per kilowatt-hour.
The initial base capacity charge for the current rate schedules was
$4.40 per kilowatt per month. The initial base energy charge was 17.80
mills per kilowatt-hour. As of April 1, 2025, the rates for capacity
and energy were not adjusted as they continued to meet their maximum
increase set by the true-up mechanism. As of April 1, 2025, the
capacity rate remained at $5.15 per kilowatt per month and the base
energy charge remained at 20.80 mills per kilowatt-hour for net revenue
available for repayment. The existing rates are not adequate to meet
repayment criteria. The annual true-up mechanism incorporated in the
rate schedules has not proven to be effective in matching revenue
available for repayment to planned amounts. In years when net revenue
was over-recovered, the adjusted current base rates fell below the
initial base rates set in the 2020 rate filing causing lower than
projected revenue in subsequent years. Southeastern is proposing to
increase the initial base capacity rate to $5.95 per kilowatt per month
and the initial base energy charge to 22.75 mills per kilowatt-hour.
Southeastern also proposes updating the annual true-up mechanism to
keep the true-up rates, during over-recovery periods, from being
reduced below the initial base capacity rate and the initial base
energy rate set in rate filings.
Proposed Unit Rates: The initial base rates for capacity and energy
will be as follows:
Capacity: $5.95 per kW per month.
Energy: 22.75 mills per kWh.
The rates are based on a repayment study estimating the Kerr-
Philpott System will produce the following net revenue available for
repayment (rounded to nearest $10,000):
------------------------------------------------------------------------
Estimated annual Cumulative net
net revenue revenue
Fiscal year available for available for
repayment repayment
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2025............................... $1,840,000 $1,840,000
2026............................... 170,000 2,010,000
2027............................... 3,530,000 5,540,000
2028............................... 3,840,000 9,380,000
2029............................... 3,930,000 13,310,000
2030............................... 3,440,000 16,750,000
2031............................... 3,600,000 20,350,000
2032............................... 3,720,000 24,070,000
2033............................... 3,860,000 27,930,000
2034............................... 4,020,000 31,950,000
------------------------------------------------------------------------
The proposed rates continue a true-up of the capacity and energy
rates based on the cumulative net revenue available for repayment from
the table above. For every 100,000 under-recovery of the planned
cumulative net revenue available for repayment, Southeastern will
increase the current base capacity charge by $0.02 per kilowatt per
month, up to a maximum of $0.75 per kilowatt per month, and increase
the current base energy charge by 0.10 mills per kilowatt-hour, up to a
maximum of 3.0 mills per kilowatt-hour. For every $100,000 over-
recovery of the planned cumulative net revenue available for repayment,
Southeastern will reduce the current base capacity charge by $0.02 per
kilowatt per month, up to a maximum of $0.75 per kilowatt per month but
not below the initial base capacity charge set in the rate filing, and
reduce the current base energy charge by 0.10 mills per kilowatt-hour,
up to a maximum of 3.0 mills per kilowatt-hour but not below the
initial base energy charge set in the rate filing, to be implemented
April 1 of the next fiscal year. Southeastern will give written notice
to customers of the amount of the true-up by February 1 of each year.
Southeastern is proposing the following rate schedules to be
effective for the period from October 1, 2025, through September 30,
2030. The capacity charge and energy charge will be the same for all
rate schedules. These rate schedules are necessary to accommodate the
transmission and scheduling arrangements available in the Kerr-Philpott
System.
Rate Schedule VA-1-E
Available to public bodies and cooperatives in Virginia and North
Carolina to whom power may be transmitted and scheduled pursuant to
contracts between the Government, Virginia Electric and Power Company
(also known as Dominion Virginia Power [DVP]), and DVP's Transmission
Operator, PJM Interconnection, LLC (PJM).
Rate Schedule VA-2-E
Available to public bodies and cooperatives in Virginia and North
Carolina to whom power may be transmitted pursuant to contracts between
the Government, DVP, and PJM. The customer is responsible for providing
a scheduling arrangement with the Government.
Rate Schedule VA-3-E
Available to public bodies and cooperatives in Virginia and North
Carolina to whom power may be scheduled pursuant to contracts between
the Government, DVP, and PJM. The customer is responsible for providing
a transmission arrangement.
Rate Schedule VA-4-E
Available to public bodies and cooperatives in the service area of
DVP and PJM. The customer is responsible for providing a scheduling
arrangement with the Government and for providing a transmission
arrangement.
Rate Schedule DEP-1-E
Available to public bodies and cooperatives in North Carolina to
whom power may be transmitted and scheduled pursuant to contracts
between the Government and Duke Energy Progress.
[[Page 20671]]
Rate Schedule DEP-2-E
Available to public bodies and cooperatives in North Carolina to
whom power may be transmitted pursuant to contracts between the
Government and Duke Energy Progress. The customer is responsible for
providing a scheduling arrangement with the Government.
Rate Schedule DEP-3-E
Available to public bodies and cooperatives in North Carolina to
whom power may be scheduled pursuant to contracts between the
Government and Duke Energy Progress. The customer is responsible for
providing a transmission arrangement.
Rate Schedule DEP-4-E
Available to public bodies and cooperatives in the service area of
Duke Energy Progress. The customer is responsible for providing a
scheduling arrangement with the Government and for providing a
transmission arrangement.
Rate Schedule AP-1-E
Available to public bodies and cooperatives in Virginia to whom
power may be transmitted and scheduled pursuant to contracts between
the Government, American Electric Power Service Corporation and the
American Electric Power Service Corporation's Transmission Operator,
PJM.
Rate Schedule AP-2-E
Available to public bodies and cooperatives in Virginia to whom
power may be transmitted pursuant to contracts between the Government,
American Electric Power Service Corporation, and PJM. The customer is
responsible for providing a scheduling arrangement with the Government.
Rate Schedule AP-3-E
Available to public bodies and cooperatives in Virginia to whom
power may be scheduled pursuant to contracts between the Government,
American Electric Power Service Corporation, and PJM. The customer is
responsible for providing a transmission arrangement.
Rate Schedule AP-4-E
Available to public bodies and cooperatives in the service area of
American Electric Power Service Corporation and PJM. The customer is
responsible for providing a scheduling arrangement with the Government
and for providing a transmission arrangement.
Rate Schedule NC-1-E
Available to public bodies and cooperatives in Virginia and North
Carolina to whom power may be transmitted pursuant to a contract
between the Government and PJM and scheduled pursuant to a contract
between the Government and Duke Energy Progress.
Rate Schedule Replacement-2-D
This rate schedule shall be applicable to the sale of energy
purchased to meet contract minimum energy and sold under appropriate
contracts between the Government and the Customer.
The referenced repayment studies are available for examination at
1166 Athens Tech Road, Elberton, Georgia 30635-6711. The Proposed Rate
Schedules VA-1-E, VA-2-E, VA-3-E, VA-4-E, DEP-1-E, DEP-2-E, DEP-3-E,
DEP-4-E, AP-1-E, AP-2-E, AP-3-E, AP-4-E, NC-1-E, and Replacement-2-D
are also available.
Legal Authority: 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 Southeastern's
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 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-
SEPA-2023, effective April 10, 2023, the Under Secretary for
Infrastructure redelegated the authority to confirm, approve, and place
such rates into effect on an interim basis to the Administrator,
Southeastern.
Environmental Compliance: Southeastern 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.
Determination Under Executive Order 12866: Southeastern 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 12,
2025, by Virgil G. Hobbs III, Administrator for Southeastern 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 May 12, 2025.
Jennifer Hartzell,
Alternate Federal Register Liaison Officer, U.S. Department of Energy.
[FR Doc. 2025-08617 Filed 5-14-25; 8:45 am]
BILLING CODE 6450-01-P
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