BPA Rate Case Information 2007 Supplemental Wholesale Power Rate Case BPA requested a stay in the final approval of its FY 2007-2009 power rates. BPA plans to publish a new rate proposal through a WP-07 Supplemental Power Rate Case. Tiered Rate Methodology Rate Case As a result of BPA's Long-Term Regional Dialogue Policy BPA is establishing a long-term Tiered Rates Methodology to implement a tiered rate construct post 2011. 2010 BPA Rate Case BPA’s Power Services and Transmission Services will conduct concurrent rate cases under separate dockets to set rates for the FY 2010-2011 rate period. These separate rate cases will be referred to as WP-10 and TR-10, respectively, and together identified as the 2010 BPA Rate Case. BPA is a self-financed federal agency. This means that BPA does not make a profit nor does it receive appropriations or tax dollars. BPA pays its costs from revenues it receives from the sale of power and related services to eligible customers, which include Northwest utilities, large industries, and other federal agencies. BPA separately develops rates for BPA's power sales and transmission services. Prior to the development of BPA's final rates in a formal evidentiary hearing, BPA determines its revenue requirements through an internal review. BPA develops preliminary rates, usually defined in $/MWh, based on the outcome of the internal review. BPA's rates must be set so that BPA will be able to recover its total costs, including obligations to repay its debt to the Federal Treasury. BPA's preliminary cost-based rate proposal is then evaluated and final rates are established in a rate case. A rate case is a formal evidentiary hearing during which BPA presents its initial power or transmission rate proposal to customers and other parties for review. BPA's initial rate proposal generally contains technical studies, documentation, and testimony of BPA witnesses. The parties review BPA's initial proposal and file testimony in response. BPA and the parties are then permitted to reply to the parties' testimonies. BPA and the parties also are allowed to conduct cross-examination of the witnesses. Parties may present oral argument to the Administrator, and file briefs with BPA summarizing their arguments. BPA's ratemaking hearings usually take over six months to complete. At the completion of BPA's rate hearing, the Administrator issues a Record of Decision, which includes BPA's final proposed rates. BPA then files its rates with the Federal Energy Regulatory Commission (FERC) for confirmation and approval. The cost-based rates BPA establishes through the hearing process apply to BPA's power or transmission sales. Over the years, effective rate periods have varied from one to five years. BPA is on a path to have rates established for two-year periods. Separate Power rates and Transmission tariff BPA sets separate rates for power (the sale of power from federal facilities) and transmission (the transfer of this power over BPA's high-voltage transmission lines throughout the PNW). This unbundled approach follows the national direction for the electric power industry established by FERC. BPA transmission provides open, non-discriminatory transmission service to any and all bulk market participants. BPA's power business line pays BPA's transmission rates to use the agency's transmission lines just like any other market participant. Timing of Power and Transmission rate cases For the last decade, BPA has conducted power and transmission rate cases on different cycles. Current power rates have been set for fiscal years 2007-2009. Transmission rates (also referred to as tariffs) have been set every two years with the latest rate schedule being set for fiscal years 2008-2009. For FY 2010 and beyond, BPA plans to synchronize power and transmission rate cases.