[Federal Register: May 20, 2004 (Volume 69, Number 98)]
[Notices]
[Page 29135-29136]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20my04-47]
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DEPARTMENT OF ENERGY
Western Area Power Administration
Salt Lake City Area Integrated Projects
AGENCY: Western Area Power Administration, DOE.
ACTION: Notice of Determination of the Post-2004 Marketable Resources.
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SUMMARY: The Western Area Power Administration (Western), a Federal
power marketing agency of the Department of Energy (DOE), announces its
determination of the Post-2004 Marketable Resources (which consists of
both capacity and energy) from the Salt Lake City Area Integrated
Projects (SLCA/IP) developed under the requirements of Subpart C--Power
Marketing Initiative of the Energy Planning and Management Program
(Program) Final Rule. Western has evaluated hydrologic studies that
indicate, most importantly, the need to reduce the energy component of
the Marketable Resources for the 20 years of the contract period. In
fiscal year (FY) 2005 (beginning October 1, 2004), the energy component
of the Marketable Resources begins at its lowest level and then
gradually increases over the next 5 years. It reaches a level in the
fifth year that remains constant through the remainder of the
contracting period, subject to change only under the terms of the
contract. Firm electric service contracts (Contracts) between Western
and its existing and new customers will permit delivery to begin with
the October 2004 billing period and continue through the September 2024
billing period (Contract Period).
DATES: The Determination of Marketable Resources will become effective
June 21, 2004 and will be available for contracting October 1, 2004.
ADDRESSES: All documents developed or retained by Western in developing
its determination of Marketable Resources are available for inspection
and copying at the Colorado River Storage Project Management Center,
150 East Social Hall Avenue, Suite 300, Salt Lake City, UT 84111.
SUPPLEMENTARY INFORMATION: Western published its Final Post-2004
Resource Pool Allocation Procedures (Procedures) in the Federal
Register (64 FR 48825, September 8, 1999) to implement Subpart C--Power
Marketing Initiative of the Program's Final Rule (10 CFR 905),
published in the Federal Register (60 FR 54151, October 20, 1995). The
Program, developed in part to implement section 114 of the Energy
Policy Act of 1992, became effective November 20, 1995. The goal of the
Program is to require planning and efficient electric energy use by
Western's long-term firm power customers and to extend Western's firm
power resource commitments.
Following publication of the Procedures, Western executed
amendments to all Contracts with existing firm electric service
customers. These amendments specified that each existing customer would
be provided its proportional share of 93 percent of the Marketable
Resources for the Contract Period. The amendments also provided that
prior to October 1, 2004, Western would solely determine the quantities
of Marketable Resources (both capacity and energy), which would be
available for the Contract Period. Western is announcing its
determination of this marketable capacity and energy with this notice.
The remaining 7 percent of the Marketable Resources available for
the Contracting Period, not extended on a proportional share basis to
Western's existing customers, was used in accordance with the
Procedures to establish a project-specific power resource pool that
allocated power to new eligible customers.
The deadline for applications from new eligible customers was June
8, 2000, and Western received 66 applications. Following evaluation,
proposed allocations for new customers were published in the Federal
Register (66 FR 31910, June 13, 2001), and final allocations were
published in the Federal Register (67 FR 5113, February 4, 2002).
Adjusted final allocations were published in the Federal Register (67
FR 49019, July 29, 2002) due to minor inconsistencies in the treatment
of the allocations for three applicants.
To the extent this Notice of Determination of Marketable Resources
establishes the quantities of marketable capacity and energy available
to all SLCA/IP customers as of October 1, 2004, the determination will
also impact the 7 percent of capacity and energy to be proportionally
allocated to the new customers.
In making its Determination of Marketable Resources, Western has
consulted with its existing and new customers in an extensive process
through meetings and in presentations to individual customers and
customer groups. Western solicited comments about the proposal by
providing each existing and new customer with written draft proposals.
After Western carefully considered the comments received, a final
proposal was developed and provided to the new and existing customers
prior to the publication of this Federal Register notice. Western has
also consulted with the Bureau of Reclamation (Reclamation) in making
this determination.
Determination of Marketable Resources
A. Marketable Energy
Western has made the determination to reduce the amount of SLCA/IP
marketable energy that will be available beginning October 1, 2004.
Western believes this decision minimizes the financial impacts of
drought conditions and will sustain the financial health of the SLCA/
IP.
The reason for lowering the amount of marketable energy is the
significant reduction in forecasted electrical generation from the
SLCA/IP during the 20-year contract period. Drought conditions in the
Upper Colorado River Basin during the last 5 years have significantly
lowered reservoir storage levels and reduced water releases through the
SLCA/IP power plants. These dry conditions resulted in
[[Page 29136]]
Western purchasing extraordinary quantities of energy to firm its
contractual energy commitments. Western developed forecasts of SLCA/IP
generation for the 20-year contract period based on projections of
water releases through the SLCA/IP facilities. Because of the lowered
reservoir levels, the near-term forecasts indicate the most severe
reductions, and lower generation amounts are also forecasted for the
entire 20-year contract period.
Western's determination of the marketable energy is calculated from
Reclamation's hydrological projections. The table shows the SLCA/IP
marketable energy available in each fiscal year. Beginning in FY 2005,
the amount of marketable energy available will increase each year until
the marketable energy level plateaus in FY 2009.
SLCA/IP Marketable Energy Levels
[Excludes Reclamation Project Use Reservations]
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Marketable
annual
Fiscal year energy
(GWh)
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FY 2005 (10/1/04-9/30/05).................................. 4,557.5
FY 2006 (10/1/05-9/30/06).................................. 4,655.3
FY 2007 (10/1/06-9/30/07).................................. 4,753.1
FY 2008 (10/1/07-9/30/08).................................. 4,851.0
FY 2009-FY 2024 (10/1/08-9/30/24).......................... 4,948.8
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Western will support these yearly energy levels with any necessary
firming purchases and establishing an appropriate firm power rate. Any
future changes, if necessary, in levels of marketable energy will be
made following the contract notification provisions.
Western recognizes the reduction in the amount of marketable energy
may pose hardships for some customers. Western believes the reduction
in marketable resources can be improved from time to time by providing
Available Hydro Power (AHP) under the contract. Should hydrologic
projections periodically improve to the extent energy is available from
the SLCA/IP power plants in excess of marketable energy, Western will
make AHP energy available to its customers.
B. Marketable Capacity
Western has decided to maintain SLCA/IP marketable capacity at
present levels for the entire Contract Period. As previously published
in the Federal Register, existing customers will be extended 93 percent
of their current capacity allocations. New customers will receive the
capacity allocations as published in the July 29, 2002, Federal
Register (67 FR 49019).
Effect on Power Allocations
As detailed above, the determination of Marketable Resources will
result in a reduction of previously published energy allocations to
both existing and new customers. The determination will not result in a
reduction of previously published capacity allocations. Allocations for
existing customers were published April 2, 1987 (52 FR 10620), and
revised August 24, 1989 (54 FR 35234). Some allocations may now differ
due to contractual changes that have occured since the original
publication. Allocations for new customers were published on July 29,
2002 (67 FR 49019). The new, reduced energy levels will be distributed
to all firm electric service customers on a proportional basis and will
be reflected in a new, revised Exhibit A for each customer. Western
will be submitting a new, revised Exhibit A to each customer after the
effective date of this notice.
Regulatory Procedure Requirements
Regulatory Flexibility Analysis
The Regulatory Flexibility Act of 1980 (5 U.S.C. 601, et seq.)
requires Federal agencies to perform a regulatory flexibility analysis
if a final rule is likely to have a significant economic impact on a
substantial number of small entities and if there is a legal
requirement to issue a general notice of proposed rulemaking. This
action does not require a regulatory flexibility analysis since it is a
rulemaking of particular applicability involving rates or services
applicable to public property.
Environmental Compliance
Western completed an ``Energy Planning and Management Program
Environmental Impact Statement'' (EIS) on the Program in 1995, pursuant
to the National Environmental Policy Act (NEPA) of 1969, 42 U.S.C.
4321, et seq.; the Council on Environmental Quality Regulations for
implementing NEPA (40 CFR 1500-1508); and the DOE NEPA Implementing
Procedures and Guidelines (10 CFR 1021). The Record of Decision was
published in the Federal Register (60 FR 53181, October 12, 1995).
Western's NEPA review assured all environmental effects related to
these procedures had been analyzed. The application of the Program's
Power Marketing Initiative to the SLCA/IP was specifically addressed in
another EIS, the ``Salt Lake City Area Integrated Projects Electric
Power Marketing Final Environmental Impact Statement,'' published in
January 1996. The Record of Decision for this EIS was published in the
Federal Register on November 1, 1996 (61 FR 56534). The Power Marketing
Initiative was applied under the provisions of the approved Program,
and public notice of the specific terms was published in the Federal
Register on June 25, 1999 (64 FR 34414). Final allocations from the
SLCA/IP resource pool were also published in the Federal Register (67
FR 49019, July 29, 2002). The two referenced EISs and associated
Records of Decision provide adequate NEPA review for the determination
of SLCA/IP marketable resources addressed in this notice.
Determination Under Executive Order 12866
Western 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.
Small Business Regulatory Enforcement Fairness Act
Western has determined that this rule is exempt from congressional
notification requirements under 5 U.S.C. 801 because the action is a
rulemaking of particular applicability relating to rates or services
and involves matters of procedure.
Dated: May 10, 2004.
Michael S. Hacskaylo,
Administrator.
[FR Doc. 04-11413 Filed 5-19-04; 8:45 am]
BILLING CODE 6450-01-P