[Federal Register: October 8, 2003 (Volume 68, Number 195)]
[Notices]
[Page 58074-58082]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr08oc03-38]
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DEPARTMENT OF ENERGY
Cumberland System of Projects
AGENCY: Southeastern Power Administration, DOE.
ACTION: Notice of rate order.
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SUMMARY: The Deputy Secretary of the Department of Energy, confirmed
and approved, on an interim basis, Rate Schedules CBR-1-E, CSI-1-E,
CEK-1-E, CM-1-E, CC-1-F, CK-1-E, CTV-1-E, and SJ-1-B. The rates were
approved on an interim basis, effective on October 1, 2003 and expire
on September 30, 2008, and are subject to confirmation and final
approval by the Federal Energy Regulatory Commission.
DATES: Approval of rate on an interim basis is effective through
September 30, 2008.
FOR FURTHER INFORMATION CONTACT: Leon Jourolmon, Assistant
Administrator, Finance & Marketing, Southeastern Power Administration,
[[Page 58075]]
Department of Energy, 1166 Athens Tech Road, Elberton, Georgia 30635-
6711, (706) 213-3800.
SUPPLEMENTARY INFORMATION: The Federal Energy Regulatory Commission, by
Order issued March 17, 2000, in Docket No. EF99-3021-000 (rehearing
denied), confirmed and approved Wholesale Power Rate Schedules CBR-1-D,
CSI-1-D, CK-1-D, CM-1-D, CC-1-E, CK-1-D, CEK-1-D, CTV-1-D, and SJ-1-A.
Rate schedules CBR-1-E, CSI-1-E, CEK-1-E, CM-1-E, CC-1-F, CK-1-E, CTV-
1-E, and SJ-1-B replace these schedules.
Dated: September 26, 2003.
Kyle E. McSlarrow,
Deputy Secretary.
Order Confirming and Approving Power Rates on an Interim Basis
[Rate Order; No. SEPA-43]
Pursuant to Sections 302(a) and 301(b) of the Department of Energy
Organization Act, Public Law 95-91, the functions of the Secretary of
the Interior and the Federal Power Commission under Section 5 of the
Flood Control Act of 1944, 16 U.S.C. 825s, relating to the Southeastern
Power Administration (Southeastern), were transferred to and vested in
the Secretary of Energy. By Delegation Order No. 00-037.00 (December 6,
2001), the Secretary of Energy delegated to the Administrator of
Southeastern the authority to develop power and transmission rates, and
delegated to the Deputy Secretary of the Department of Energy the
authority to confirm, approve, and place in effect such rates on an
interim basis, and delegated to the Federal Energy Regulatory
Commission (FERC) the authority to confirm and approve on a final basis
or to disapprove rates developed by the Administrator under the
delegation. This rate order is issued by the Deputy Secretary pursuant
to said delegation.
Background
Power from the Cumberland System of Projects is presently sold
under Wholesale Power Rate Schedules CBR-1-D, CSI-1-D, CEK-1-D, CM-1-D,
CC-1-E,CK-1-D, CTV-1-D, and SJ-1-A. These rate schedules were approved
by the FERC on March 17, 2000 (90 FERC 61266).
Discussion
System Repayment
An examination of Southeastern's revised system power repayment
study, prepared in July 2003, for the Cumberland System shows that with
an annual revenue increase of $6,230,000 over the revenues in the
current repayment study using current rates, all system power costs are
paid within the 50-year repayment period required by existing law and
DOE Procedure RA 6120.2. The Administrator of Southeastern has
certified that the rates are consistent with applicable law and that
they are the lowest possible rates to customers consistent with sound
business principles.
Public Notice and Comment
Opportunities for Public Review and Comment on Wholesale Power Rate
Schedules CBR-1-E, CSI-1-E, CEK-1-E, CM-1-E, CC-1-F, CK-1-E, CTV-1-E,
and SJ-1-B, was announced by notice published in the Federal Register
on March 25, 2003. A Public Information and Comment Forum was held May
1, 2003, in Nashville, Tennessee, and written comments were invited
through June 23, 2003. The notice proposed rates with a revenue
increase of $8,063,000 in Fiscal Year 2004 and all future years. Based
on comments received, Southeastern revised the proposed rates. The
proposed rate adjustment now shows a revenue increase of $6,230,000.
Transcripts of the Public Information and Comment Forums are included
as Exhibit A-4. A review of comments is included as Exhibit A-5. The
following is a summary of the comments.
Staff Evaluation of Public Comments
Notice of proposed rate adjustment was published in the Federal
Register March 25, 2003 (68 FR 14418). The notice advised interested
parties of a public information and comment forum that would be held in
Nashville, Tennessee on May 1, 2003. Written comments were accepted on
or before June 23, 2003. Written comments were received from six
sources pursuant to this notice.
A. Comments Regarding Cost Estimates
1. Many comments pertained to the inclusion of a plan of
rehabilitation for the Cumberland Projects provided by the Corps of
Engineers. The Customers, the Corps of Engineers, and Southeastern are
in the process of drafting a Memorandum of Agreement (MOA) that would
provide for Customer funding of Renewals and Replacements. Many of the
comments stated that the customers did not believe it was appropriate
to include costs in the Cumberland System rates until the MOA was
executed. These comments include the following:
[sbull] The proposed rate over collects funds for the Corps
Operations and Maintenance (``O&M'') and Renewals and Replacements
(``R&R'') activities. (SeFPC, SMEPA)
[sbull] The members of the SeFPC believe that Southeastern should
only include those amounts in rates for O&M and R&R that reflect the
amounts that the Corps actually allocates to hydropower activities in
the Cumberland System of Projects. (SeFPC)
[sbull] Unless and until an MOA is in place, the Customers believe
that only those amounts that Corps will receive in appropriations
should be included in the rates. (SeFPC)
[sbull] The SeFPC submits that the proposed rate increase should
only include those amounts where Southeastern can verify that the funds
provided to the Corps are actually spent for hydropower purposes.
(SeFPC)
[sbull] If Congress does not intend to provide Construction General
funds in the Fiscal Year 2004 Appropriations for the Corps and there is
no MOA to provide funding of renewals, replacements, and rehabilitation
work, the Customers contend that Southeastern cannot legally recover
the amounts in the rates for these activities. (SeFPC)
[sbull] In light of the fact that the President's budget request
does not contain any construction general funds for the projects on the
Cumberland River Basin, the SeFPC notes that Southeastern should not
recover any joint capitalized cost from the hydropower customers.
(SeFPC)
[sbull] Only in the event that the Customers, Southeastern, and the
Corps find consensus for an MOA should Southeastern include amounts in
the 20-rates for renewals and replacements. Unless this occurs prior to
the implementation of the rate[s] on an interim basis Southeastern
should not include these amounts in the proposed rate schedule[s].
(SeFPC)
[sbull] Southeastern will be collecting revenue for capital
improvements that do not have guaranteed funds available. Southeastern
customers may end up paying more for less reliable power. (KU
Municipals)
[sbull] TVA strongly recommends that Southeastern make the
implementation of the Rehabilitation funding components of the proposed
rate increase, and the proposed changes in Southeastern's billing of
TVA, conditioned upon mutual agreement being reached by the various
parties on a funding mechanism that will result in the Corps actually
receiving the funding generated by the Rehabilitation funding component
of the proposed rate increase for those Rehabilitation work items which
have been approved by Southeastern customers. (TVA)
[sbull] Southeastern has included in its rates future costs of
replacements or
[[Page 58076]]
other capital costs when Southeastern is fully aware that under the
current state of affairs there is no reasonable certainty that such
capital costs will be incurred. TVPPA, on behalf of the TVA area
preference customers, cannot support the continued collection of funds
through the Southeastern rates that simply are sent to the U.S.
Treasury, and ultimately either never used, or used for some purpose
other than rehabilitating the projects for which they were collected.
The inclusion in the rate design of such Phantom Capital Costs is
contrary to statute. (TVPPA)
[sbull] By including the Phantom Capital Costs as stated above,
Southeastern fails to charge the lowest possible rates to consumers
consistent with sound business practices as required by statute.
(TVPPA)
[sbull] We do not see any basis for attempting to recover, in the
form of proposed increases in Southeastern rates in accordance with
section 5 of the Flood Control Act of 1944, costs that have not yet
been incurred (and which may never be incurred unless a contractual
funding mechanism is implemented), except where Southeastern customers
have agreed in accordance with the type of funding mechanisms
referenced earlier. It seems challenging to justify use of rate-setting
methodology that is based upon amortization and repayment of
appropriation investments to recover, in rates charged to TVA,
investments that have not yet been made, and which might never be made.
(TVA)
[sbull] Given the financial impacts that assuming the financing
responsibility for as much as $260 million of Rehabilitation capital
expenditures over the next 20 or more years will have on Southeastern
customers, it appears appropriate that, as part of any funding
mechanism, Southeastern customers should have approval and oversight
rights with regard to those Cumberland Basin Project work items they
would be financing. (TVA)
[sbull] Under any funding mechanism, it also would be more
appropriate for the Rehabilitation funding component of Southeastern
rates for any given year to be governed by the funding requirements of
work items approved by Southeastern customers, and not by the amount of
funding proposed for work items that are not yet approved. (TVA)
[sbull] Southeastern customers, by virtue of their assuming of
future financing responsibility under a funding mechanism that offers
no prospect of their being financially repaid, deserve a role in:
1. Helping determine what specific work items at the Cumberland
Basin Projects warrant the funding they will provide;
2. Exercising reasonable oversight over the performance of such
work to help assure that it is completed as intended; and
3. Having appropriate guarantees to help assure that they will
ultimately receive the intended value from the funding they will
provide. (TVA)
Response: Based on the comments received, Southeastern has revised
the projected hydropower replacement costs for the Cumberland System.
The revised projections for the cost evaluation period will reflect the
amount the Corps actually allocated to hydropower activities in the
Cumberland System. After the cost evaluation period, projections will
be based on a statistical projection of replacements from a Corps of
Engineers depreciation study.
Section 10 (l.) of DOE Procedure RA 6120.2 requires that ``Future
replacement costs will be included in the repayment studies by adding
the estimated capital cost of replacement to the unpaid Federal
Investment in the year each replacement is estimated to go into
service, and adding it to the allowable unamortized investment.''
If an MOA is executed and the customers agree to fund the Corps'
plan to rehabilitate the Cumberland projects, it may be necessary for
Southeastern to file another rate adjustment.
2. It is TVA's understanding that approximately three-fourths of
the proposed rate increase is designed to recover amounts to fund, over
the next 20 or more years, approximately $260 million of new projects
for renewals, rehabilitations, and replacements (Rehabilitation) work
at Corps hydroelectric projects in the Cumberland Basin System. (TVA)
Response: The comment overstates the impact of the Corps'
Rehabilitation program on Southeastern's rates. Without including the
Corps' 20-year plan for renewals, rehabilitations, and replacements,
Southeastern will propose a rate increase of about fifteen percent
(15%). The proposed rate adjustment, with the Corps' 20-year plan of
renewals, rehabilitations, and replacements, is an increase of about
twenty percent (20%). As such, the Corps' plan for rehabilitation of
the Cumberland projects accounts for about one-fourth of the rate
adjustment proposed in the Federal Register on March 25, 2003, (68 FR
14419).
3. Southeastern is proposing a rate that will satisfy expense and
repayment requirements for capital additions over the next 50 years.
However, Southeastern is not offering a 50 year contract or any
guarantee that the improvements will be made or the power will be
available over the next 50 years. It would be more appropriate to
propose a rate for a five-year period that provides revenue for
projected expenses and repayment requirements over that same 5 years.
(KU Municipals)
Response: To conform to requirements of RA 6120.2, the repayment
study must extend to the end of the repayment life of the repayment
period for the last investment in service. It is Southeastern's opinion
that the proposal in this comment does not conform to the requirements
of RA 6120.2.
B. Comments Regarding Purchased Power Costs
4. Southeastern received comments that Southeastern overstated the
impact of replacement energy costs on the proposed rates. These
comments included the following:
[sbull] There is little evidence to support the claim in the
Federal Register Notice that the rate adjustment is driven by increased
purchased power costs. (SeFPC)
[sbull] The SeFPC understands replacement energy expenditures have
only amounted to a little over $3.5 million since the implementation of
the last rate increase in 1999. There appears to be little foundation
therefore for Southeastern to raise rates over $40 million for a five
year period to account for purchased power costs that have averaged a
little over $1 million in each year since the last rate increase.
(SeFPC)
Response: The Federal Register Notice reads ``Existing rates have
been in effect since July 1, 1999. The Cumberland System region has
incurred a severe drought since that time. This has impacted repayment
in two ways. First, revenues have been reduced because Southeastern has
had less energy available for sale. Second, expenses have increased
because it has been necessary for Southeastern to purchase replacement
energy to meet its minimum energy obligations.''
The notice further states, ``The Corps of Engineers has provided
Southeastern with a plan of capital expenditures necessary to
rehabilitate the projects in the Cumberland System. These costs are
included in the proposed rates.''
Cumberland System purchased power totaled about $3.5 million since
rates for the Cumberland System were last adjusted in 1999. The 1999
rate adjustment for the Cumberland System included no estimate for
purchased power. As such, the purchased power costs are a factor in the
proposed rate adjustment. However, Southeastern does not claim that
this proposed rate
[[Page 58077]]
adjustment is driven exclusively by purchased power costs. Purchased
power costs are among the factors causing this rate adjustment.
5. Some comments requested Southeastern implement a pass-though
charge for purchases of replacement energy. These comments included the
following:
[sbull] The SeFPC would encourage Southeastern to implement a rate
recovery mechanism that would allow immediate pass through of purchased
power costs for the Cumberland System of Projects. (SeFPC, SMEPA)
[sbull] When the Southeastern anticipates making expenditures for
purchased power, the Customers would ask Southeastern to work with Team
Cumberland Group to minimize high costs. In the event Southeastern
expects to make extended replacement power purchases, the Customers
would ask Southeastern to implement a consultation process that
involves more frequent coordination with the Customers so that
replacement power purchases are the lowest possible consistent with
sound business principles. (SeFPC)
[sbull] Because of the need to raise rates in light of previous
purchases of replacement energy, the SeFPC submits that Southeastern
needs to revise the rate proposal to account for the purchased power
costs in a more transparent manner so that the Customers can accurately
measure the costs in the Customers' individual resource portfolios. In
this regard, the SeFPC recommends changing the rate schedule to provide
for the immediate pass through of purchased power cost and coordination
with the Team Cumberland Group to ensure that such costs are incurred
in a manner consistent with sound business principles. (SeFPC)
Response: Southeastern implemented a pass-through mechanism to
recover purchases of replacement energy in Southeastern's Georgia-
Alabama-South Carolina System starting in fiscal year 2003. However,
marketing arrangements and rate design issues make implementation of a
replacement energy pass-through rate on the Cumberland System complex.
As the rates are proposed, most of the customers outside the TVA system
have no energy charge. Most of Southeastern's Cumberland customers
outside the TVA system receive a firm energy allocation of 1500
kilowatt-hours of energy for each kilowatt of capacity. TVA and the 160
preference entities on the TVA system receive the residual output of
the Cumberland Projects.
Southeastern believes it is inappropriate to propose a pass-through
to attempt to implement a replacement energy pass-through without
soliciting comments from all interested parties. Southeastern will
consider developing a proposed pass-through mechanism for comment from
all interested parties. As such, Southeastern will give consideration
to the comment and may propose a pass-through of replacement energy
costs with the next proposed rate adjustment for the Cumberland
Projects.
C. Comments Regarding Sales of Water Storage
6. The proposed rate does not accurately capture the revenues that
the Corps should be receiving from sale of water storage at Corps
projects. The Southeastern should verify whether the Corps has executed
all necessary contracts for water storage at facilities in the
Cumberland River Basin system. To remain consistent with the Flood
Control Act, Southeastern must factor into rates the recovery of the
revenues to be provided in Water Storage contracts. In the event that
Southeastern is aware of non-authorized use of water storage at the
projects for which the Corps has not executed a water storage contract,
the members of the SeFPC believe that Southeastern has an obligation to
disclose such use in the rate schedules. (SeFPC, SMEPA)
Response: The Corps expects to execute and collect new water
storage agreements for projects in the Cumberland System in the near
future. When the Corps has executed these agreements and collects funds
for the sale of water storage, Southeastern will include these revenues
as part of the cost recovery for the Cumberland System projects.
D. Comments Regarding TVA Transmission
7. The proposed rate includes Tennessee Valley Authority (``TVA'')
transmission charges that have not been deemed to be just and
reasonable. As the Customers have held longstanding concerns regarding
the appropriateness of the TVA transmission rate, the detailed concerns
of the SeFPC on this specific topic, which were not addressed in
Southeastern's prior rate proposal, are incorporated herein by
reference. (SeFPC, SMEPA)
Response: The review of public comments in Southeastern's prior
rate proposal states ``Section 9.1 of the TVA-Southeastern Contract,
executed October 1, 1997, allows TVA to adjust rates for delivering
power to the points of delivery to the ``Other Customers'' defined as
customers outside the TVA area. Section 9.1 does not provide any means
for Southeastern to determine an appropriate transmission rate. TVA and
``Other Customers'' are disagreeing over the appropriateness of the
rate increase.'' The comments further state ``Southeastern will support
discussions between TVA and the customers outside the TVA system in an
effort to reach a negotiated settlement on an appropriate amount for
the TVA transmission charge.''
As such, Southeastern's role in this issue is as a facilitator.
Southeastern remains willing to support discussions between TVA and the
customers outside the TVA system in an effort to reach a negotiated
settlement on an appropriate amount for the TVA transmission charge.
E. Comments Regarding Marketing
8. In Southeastern's forum exhibit 6 the base energy shown for East
Kentucky Power Cooperative (EKPC) is 251,618 MWh. Based on EKPC's
entitlement to 1500 kWh/kW capacity (170 MW), this should be 255,000
MWh. (East Kentucky)
Response: Southeastern's marketing arrangements with East Kentucky
provide that East Kentucky receive the entire output of the Laurel
Project (70 megawatt), plus 100 megawatt from the other projects in the
Cumberland System. East Kentucky receives 36,900 megawatt-hours of
additional energy from the other Cumberland projects to supplement the
generation available at the Laurel Project. With the additional energy
from the other Cumberland projects, the Laurel Project was expected to
provide an average of 1500 megawatt-hours of energy per megawatt of
capacity per contract year. In actual operation during the past few
years, the Laurel Project has produced less energy, on average, than
was forecast. The average energy available to East Kentucky has been
251,618 megawatt-hours per year. Southeastern has revised the repayment
study to show that East Kentucky is expected to receive an estimated
average of 255,000 megawatt-hours of energy per contract year.
9. Since 70 MW of EKPC's total Southeastern allocation of 170 MW
and related energy is to be produced by the Laurel Project, EKPC is at
the mercy of the actual annual rainfall in the Laurel Lake watershed
and resulting power production. EKPC asks that provisions be made to
guarantee that EKPC receive its entitlement of a minimum of 255,000 MWh
each and every year. (East Kentucky)
Response: The comment relates to Southeastern's marketing
arrangements with East Kentucky, and is not pertinent
[[Page 58078]]
to the proposed rates. Southeastern's marketing arrangements with East
Kentucky are discussed in the response to comment 8 above. Southeastern
is willing to consider any revisions to the contract between
Southeastern and East Kentucky that East Kentucky may propose. Such
revisions would have to be evaluated for their impact on other
customers of the Cumberland System.
F. Comments Regarding Rate Design
10. East Kentucky Power Cooperative requests that Southeastern
revise its Proposed Wholesale Power Rate Schedule CEK-1-E as follows:
[The design includes an energy charge for energy from the Laurel
Project and reduces the capacity charge for capacity from the Laurel
Project by the anticipated 1500 hours energy per year] (East Kentucky)
Response: Southeastern will revise the proposed rate schedule CEK-
1-E to provide no energy with the capacity charge. All energy provided
under this rate schedule will be billed at the additional energy rate.
Order
In view of the foregoing and pursuant to the authority vested in me
as the Deputy Secretary of Energy, I hereby confirm and approve on an
interim basis, effective October 1, 2003, attached Wholesale Power Rate
Schedules CBR-1-E, CSI-1-E, CEK-1-E, CM-1-E, CC-1-F, CK-1-E, CTV-1-E,
and SJ-1-B.
The Rate Schedules shall remain in effect on an interim basis
through September 30, 2008, unless such period is extended or until the
FERC confirms and approves them or substitutes Rate Schedules on a
final basis.
Dated: September 26, 2003
Kyle E. McSlarrow,
Deputy Secretary.
Wholesale Power Rate Schedule CBR-1-E
Availability: This rate schedule shall be available to Big Rivers
Electric Corporation and includes the City of Henderson, Kentucky,
(hereinafter called the Customer).
Applicability: This rate schedule shall be applicable to electric
capacity and energy available from the Dale Hollow, Center Hill, Wolf
Creek, Cheatham, Old Hickory, Barkley, J. Percy Priest and Cordell Hull
Projects (all of such projects being hereinafter called collectively
the ``Cumberland Projects'') and sold in wholesale quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of sixty hertz. The power shall be delivered at nominal
voltages of 13,800 volts and 161,000 volts to the transmission system
of Big Rivers Electric Corporation.
Points of Delivery: Capacity and energy delivered to the Customer
will be delivered at points of interconnection of the Customer at the
Barkley Project Switchyard, at a delivery point in the vicinity of the
Paradise steam plant and at such other points of delivery as may
hereafter be agreed upon by the Government and TVA.
Monthly Rate: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand charge: $3.373 per kilowatt/month of total contract demand.
Energy Charge: None.
Energy to be Furnished by the Government: The Government shall make
available each contract year to the customer from the Projects through
the customer's interconnections with TVA and the customer will schedule
and accept an allocation of 1,500 kilowatt-hours of energy delivered at
the TVA border for each kilowatt of contract demand. A contract year is
defined as the 12 months beginning July 1 and ending at midnight June
30 of the following calendar year. The energy made available for a
contract year shall be scheduled monthly such that the maximum amount
scheduled in any month shall not exceed 240 hours per kilowatt of the
customer's contract demand and the minimum amount scheduled in any
month shall not be less than 60 hours per kilowatt of the customer's
contract demand. The customer may request and the Government may
approve energy scheduled for a month greater than 240 hours per
kilowatt of the customer's contract demand; provided, that the combined
schedule of all Southeastern customers outside TVA and served by TVA
does not exceed 240 hours per kilowatt of the total contract demands of
these customers.
Billing Month: The billing month for power sold under this schedule
shall end at 2400 hours CDT or CST, whichever is currently effective,
on the last day of each calendar month.
Conditions of Service: The customer shall at its own expense
provide, install, and maintain on its side of each delivery point the
equipment necessary to protect and control its own system. In so doing,
the installation, adjustment, and setting of all such control and
protective equipment at or near the point of delivery shall be
coordinated with that which is installed by and at the expense of TVA
on its side of the delivery point.
Service Interruption: When delivery of capacity is interrupted or
reduced due to conditions on the Administrator's system beyond his
control, the Administrator will continue to make available the portion
of his declaration of energy that can be generated with the capacity
available.
For such interruption or reduction due to conditions on the
Administrator's system which have not been arranged for and agreed to
in advance, the demand charge for capacity made available will be
reduced as to the kilowatts of such capacity which have been
interrupted or reduced in accordance with the following formula:
[GRAPHIC] [TIFF OMITTED] TN08OC03.009
Wholesale Power Rate Schedule CSI-1-E
Availability: This rate schedule shall be available to Southern
Illinois Power Cooperative (hereinafter the Customer).
Applicability: This rate schedule shall be applicable to electric
capacity and energy available from the Dale Hollow, Center Hill, Wolf
Creek, Cheatham, Old Hickory, Barkley, J. Percy Priest and Cordell Hull
Projects (all of such projects being hereinafter called collectively
the ``Cumberland Projects'') and sold in wholesale quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of sixty hertz. The power shall be delivered at nominal
voltages of 13,800 volts and 161,000 volts to the transmission system
of Big Rivers Electric Corporation.
Points of Delivery: Capacity and energy delivered to the Customer
will be
[[Page 58079]]
delivered at points of interconnection of the Customer at the Barkley
Project Switchyard, at a delivery point in the vicinity of the Paradise
steam plant and at such other points of delivery as may hereafter be
agreed upon by the Government and TVA.
Monthly Rate: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand charge: $3.373 per kilowatt/month of total contract demand
Energy Charge: None
Energy to be Furnished by the Government: The Government shall make
available each contract year to the customer from the Projects through
the customer's interconnections with TVA and the customer will schedule
and accept an allocation of 1,500 kilowatt-hours of energy delivered at
the TVA border for each kilowatt of contract demand. A contract year is
defined as the 12 months beginning July 1 and ending at midnight June
30 of the following calendar year. The energy made available for a
contract year shall be scheduled monthly such that the maximum amount
scheduled in any month shall not exceed 240 hours per kilowatt of the
customer's contract demand and the minimum amount scheduled in any
month shall not be less than 60 hours per kilowatt of the customer's
contract demand. The customer may request and the Government may
approve energy scheduled for a month greater than 240 hours per
kilowatt of the customer's contract demand; provided, that the combined
schedule of all Southeastern customers outside TVA and served by TVA
does not exceed 240 hours per kilowatt of the total contract demands of
these customers.
Billing Month: The billing month for power sold under this schedule
shall end at 2400 hours CDT or CST, whichever is currently effective,
on the last day of each calendar month.
Service Interruption: When delivery of capacity is interrupted or
reduced due to conditions on the Administrator's system beyond his
control, the Administrator will continue to make available the portion
of his declaration of energy that can be generated with the capacity
available.
For such interruption or reduction due to conditions on the
Administrator's system which have not been arranged for and agreed to
in advance, the demand charge for capacity made available will be
reduced as to the kilowatts of such capacity which have been
interrupted or reduced in accordance with the following formula:
[GRAPHIC] [TIFF OMITTED] TN08OC03.010
Wholesale Power Rate Schedule CEK-1-E
Availability: This rate schedule shall be available to East
Kentucky Power Cooperative (hereinafter called the Customer).
Applicability: This rate schedule shall be applicable to electric
capacity and energy available from the Dale Hollow, Center Hill, Wolf
Creek, Cheatham, Old Hickory, Barkley, J. Percy Priest and Cordell Hull
Projects (all of such projects being hereinafter called collectively
the ``Cumberland Projects'') and power available from the Laurel
Project and sold in wholesale quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of sixty hertz. The power shall be delivered at nominal
voltages of 161,000 volts to the transmission systems of the Customer.
Points of Delivery: The points of delivery will be the 161,000 volt
bus of the Wolf Creek Power Plant and the 161,000 volt bus of the
Laurel Project. Other points of delivery may be as agreed upon.
Monthly Rate: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand charge: $2.232 per kilowatt/month of total contract demand
Energy Charge: 9.13 mills per kilowatt-hour
Energy to be Furnished by the Government: The Government shall make
available each contract year to the customer from the Projects through
the customer's interconnections with TVA and the customer will schedule
and accept an allocation of 1,500 kilowatt-hours of energy delivered at
the TVA border for each kilowatt of contract demand plus 369 kilowatt-
hours of energy delivered for each kilowatt of contract demand to
supplement energy available at the Laurel Project. A contract year is
defined as the 12 months beginning July 1 and ending at midnight June
30 of the following calendar year. The energy made available for a
contract year shall be scheduled monthly such that the maximum amount
scheduled in any month shall not exceed 240 hours per kilowatt of the
customer's contract demand and the minimum amount scheduled in any
month shall not be less than 60 hours per kilowatt of the customer's
contract demand. The customer may request and the Government may
approve energy scheduled for a month greater than 240 hours per
kilowatt of the customer's contract demand; provided, that the combined
schedule of all Southeastern customers outside TVA and served by TVA
does not exceed 240 hours per kilowatt of the total contract demands of
these customers.
Billing Month: The billing month for power sold under this schedule
shall end at 2400 hours CDT or CST, whichever is currently effective,
on the last day of each calendar month.
Conditions of Service: The customer shall at its own expense
provide, install, and maintain on its side of each delivery point the
equipment necessary to protect and control its own system. In so doing,
the installation, adjustment and setting of all such control and
protective equipment at or near the point of delivery shall be
coordinated with that which is installed by and at the expense of TVA
on its side of the delivery point.
Service Interruption: When delivery of capacity is interrupted or
reduced due to conditions on the Administrator's system beyond his
control, the Administrator will continue to make available the portion
of his declaration of energy that can be generated with the capacity
available.
For such interruption or reduction due to conditions on the
Administrator's system which have not been arranged for and agreed to
in advance, the demand charge for capacity made available will be
reduced as to the kilowatts of such capacity which have been
interrupted or reduced in accordance with the following formula:
[[Page 58080]]
[GRAPHIC] [TIFF OMITTED] TN08OC03.011
Wholesale Power Rate Schedule CM-1-E
Availability: This rate schedule shall be available to the South
Mississippi Electric Power Association, Municipal Energy Agency of
Mississippi, and Mississippi Delta Energy Agency (hereinafter called
the Customers).
Applicability: This rate schedule shall be applicable to electric
capacity and energy available from the Dale Hollow, Center Hill, Wolf
Creek, Cheatham, Old Hickory, Barkley, J. Percy Priest and Cordell Hull
Projects (all of such projects being hereinafter called collectively
the ``Cumberland Projects'') and sold in wholesale quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of sixty hertz. The power shall be delivered at nominal
voltages of 161,000 volts to the transmission systems of Mississippi
Power and Light.
Points of Delivery: The points of delivery will be at
interconnection points of the Tennessee Valley Authority system and the
Mississippi Power and Light system. Other points of delivery may be as
agreed upon.
Monthly Rate: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand charge: $3.373 per kilowatt/month of total contract demand
Energy Charge: None
Energy to be Furnished by the Government: The Government shall make
available each contract year to the Customer from the Projects through
the Customer's interconnections with TVA and the Customer will schedule
and accept an allocation of 1,500 kilowatt-hours of energy delivered at
the TVA border for each kilowatt of contract demand. A contract year is
defined as the 12 months beginning July 1 and ending at midnight June
30 of the following calendar year. The energy made available for a
contract year shall be scheduled monthly such that the maximum amount
scheduled in any month shall not exceed 240 hours per kilowatt of the
Customer's contract demand and the minimum amount scheduled in any
month shall not be less than 60 hours per kilowatt of the Customer's
contract demand. The Customer may request and the Government may
approve energy scheduled for a month greater than 240 hours per
kilowatt of the Customer's contract demand; provided, that the combined
schedule of all Southeastern Customers outside TVA and served by TVA
does not exceed 240 hours per kilowatt of the total contract demands of
these Customers.
In the event that any portion of the capacity allocated to the
Customers is not initially delivered to the Customers as of the
beginning of a full contract year, the 1500 kilowatt hours shall be
reduced 1/12 for each month of that year prior to initial delivery of
such capacity.
Billing Month: The billing month for power sold under this schedule
shall end at 2400 hours CDT or CST, whichever is currently effective on
the last day of each calendar month.
Service Interruption: When delivery of capacity is interrupted or
reduced due to conditions on the Administrator's system beyond his
control, the Administrator will continue to make available the portion
of his declaration of energy that can be generated with the capacity
available.
For such interruption or reduction due to conditions on the
Administrator's system which have not been arranged for and agreed to
in advance, the demand charge for capacity made available will be
reduced as to the kilowatts of such capacity which have been
interrupted or reduced in accordance with the following formula:
[GRAPHIC] [TIFF OMITTED] TN08OC03.012
Wholesale Power Rate Schedule CC-1-F
Availability: This rate schedule shall be available to public
bodies and cooperatives served through the facilities of Carolina Power
& Light Company, Western Division (hereinafter called the Customers).
Applicability: This rate schedule shall be applicable to electric
capacity and energy available from the Dale Hollow, Center Hill, Wolf
Creek, Cheatham, Old Hickory, Barkley, J. Percy Priest and Cordell Hull
Projects (all of such projects being hereinafter called collectively
the ``Cumberland Projects'') and sold in wholesale quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of sixty hertz. The power shall be delivered at nominal
voltages of 161,000 volts to the transmission system of Carolina Power
& Light Company, Western Division.
Points of Delivery: The points of delivery will be at
interconnecting points of the Tennessee Valley Authority system and the
Carolina Power & Light Company, Western Division system. Other points
of delivery may be as agreed upon.
Monthly Rate: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand charge: $3.839 per kilowatt/month of total contract demand
Energy Charge: None
CP&L Transmission Charge: $1.2493 per kilowatt/month of total contract
demand
The CP&L transmission rate is subject to annual adjustment on April
1 of each year and will be computed subject to the formula in Appendix
A attached to the Government--Carolina Power & Light Company contract.
Energy to be Furnished by the Government: The Government will sell
to the customer and the customer will purchase from the Government
energy each billing month equivalent to a percentage specified by
contract of the energy made available to Carolina Power & Light Company
(less six percent (6%) losses). The Customer's contract demand and
accompanying
[[Page 58081]]
energy allocation will be divided pro rata among its individual
delivery points served from the Carolina Power & Light Company's,
Western Division transmission system.
Billing Month: The billing month for power sold under this schedule
shall end at 2400 hours CDT or CST, whichever is currently effective,
on the last day of each calendar month.
Wholesale Power Rate Schedule CK-1-E
Availability: This rate schedule shall be available to public
bodies served through the facilities of Kentucky Utilities Company,
(hereinafter called the Customers.)
Applicability: This rate schedule shall be applicable to electric
capacity and energy available from the Dale Hollow, Center Hill, Wolf
Creek, Cheatham, Old Hickory, Barkley, J. Percy Priest and Cordell Hull
Projects (all of such projects being hereinafter called collectively
the ``Cumberland Projects'') and sold in wholesale quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of sixty hertz. The power shall be delivered at nominal
voltages of 161,000 volts to the transmission systems of Kentucky
Utilities Company.
Points of Delivery: The points of delivery will be at
interconnecting points between the Tennessee Valley Authority system
and the Kentucky Utilities Company system. Other points of delivery may
be as agreed upon.
Monthly Rate: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand charge: $3.373 per kilowatt/month of total contract demand
Energy Charge: None
Additional Energy Charge: 9.13 mills per kilowatt-hour
Energy to be Furnished by the Government: The Government shall make
available each contract year to the Customer from the Projects and the
Customer will accept an allocation of 1,500 kilowatt-hours of energy
for each kilowatt of contract demand. A contract year is defined as the
12 months beginning July 1 and ending at midnight June 30 of the
following calendar year. The energy made available for a contract year
shall be scheduled monthly such that the maximum amount scheduled in
any month shall not exceed 240 hours per kilowatt of the Customer's
contract demand and the minimum amount scheduled in any month shall not
be less than 60 hours per kilowatt of the Customer's contract demand.
The Customer may request and the Government may approve energy
scheduled for a month greater than 240 hours per kilowatt of the
Customer's contract demand; provided, that the combined schedule of all
Southeastern Customers outside TVA and served by TVA does not exceed
240 hours per kilowatt of the total contract demands of these
Customers.In the event that any portion of the capacity allocated to
the Customers is not initially delivered to the Customers as of the
beginning of a full contract year, the 1500 kilowatt hours shall be
reduced 1/12 for each month of that year prior to initial delivery of
such capacity.
For billing purposes, each kilowatt of capacity will include 1500
kilowatt-hours energy per year. Customers will pay for additional
energy at the additional energy rate.
Billing Month: The billing month for power sold under this schedule
shall end at 2400 hours CDT or CST, whichever is currently effective on
the last day of each calendar month.
Wholesale Power Rate Schedule CTV-1-E
Availability: This rate schedule shall be available to the
Tennessee Valley Authority (hereinafter called TVA).
Applicability: This rate schedule shall be applicable to electric
capacity and energy generated at the Dale Hollow, Center Hill, Wolf
Creek, Old Hickory, Cheatham, Barkley, J. Percy Priest, and Cordell
Hull Projects (all of such projects being hereafter called collectively
the ``Cumberland Projects'') and the Laurel Project sold under
agreement between the Department of Energy and TVA.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a frequency of
approximately 60 Hertz at the outgoing terminals of the Cumberland
Projects' switchyards.
Monthly Rates: The monthly rate for capacity and energy sold under
this rate schedule shall be:
Demand Charge: $1.907 per kilowatt/month of total demand as determined
by the agreement between the Department of Energy and TVA.
Energy Charge: None
Additional Energy Charge: 9.13 mills per kilowatt-hour
Energy to be Made Available: The Department of Energy shall
determine the energy that is available from the projects for
declaration in the billing month.
To meet the energy requirements of the Department of Energy's
customers outside the TVA area (hereinafter called Other Customers),
768,000 megawatt-hours of net energy shall be available annually
(including 36,900 megawatt-hours of annual net energy to supplement
energy available at Laurel Project). The energy requirement of the
Other Customers shall be available annually, divided monthly such that
the maximum available in any month shall not exceed 240 hours per
kilowatt of total Other Customers contract demand, and the minimum
amount available in any month shall not be less than 60 hours per
kilowatt of total Other Customers demand.
In the event that any portion of the capacity allocated to Other
Customers is not initially delivered to the Other Customers as of the
beginning of a full contract year, (July through June), the 1500 hours,
plus any such additional energy required as discussed above, shall be
reduced \1/12\ for each month of that year prior to initial delivery of
such capacity.
The energy scheduled by TVA for use within the TVA System in any
billing month shall be the total energy delivered to TVA less (1) an
adjustment for fast or slow meters, if any, (2) an adjustment for
Barkley-Kentucky Canal of 15,000 megawatt-hours of energy each month
which is delivered to TVA under the agreement from the Cumberland
Projects without charge to TVA, (3) the energy scheduled by the
Department of Energy in said month for the Other Customers plus losses
of two (2) percent, and (4) station service energy furnished by TVA.
Each kilowatt of capacity will include 1500 kilowatt-hours of
energy per year, which is defined as base energy. Energy received in
excess of 1500 kilowatt-hours per kilowatt will be subject to an
additional energy charge identified in the monthly rates section of
this rate schedule.
Billing Month: The billing month for capacity and energy sold under
this schedule shall end at 2400 hours CDT or CST, whichever is
currently effective, on the last day of each calendar month.
Contract Year: For purposes of this rate schedule, a contract year
shall be as in Section 13.1 of the Southeastern Power Administration--
Tennessee Valley Authority Contract.
Service Interruption: When delivery of capacity to TVA is
interrupted or reduced due to conditions on the Department of Energy's
system that are beyond its control, the Department of Energy will
continue to make available the portion of its declaration of energy
that can be generated with the capacity available.
For such interruption or reduction (exclusive of any restrictions
provided
[[Page 58082]]
in the agreement) due to conditions on the Department of Energy's
system which have not been arranged for and agreed to in advance, the
demand charge for scheduled capacity made available to TVA will be
reduced as to the kilowatts of such scheduled capacity which have been
so interrupted or reduced for each day in accordance with the following
formula:
[GRAPHIC] [TIFF OMITTED] TN08OC03.013
Power Factor: TVA shall take capacity and energy from the
Department of Energy at such power factor as will best serve TVA's
system from time to time; provided, that TVA shall not impose a power
factor of less than .85 lagging on the Department of Energy's
facilities which requires operation contrary to good operating practice
or results in overload or impairment of such facilities.
Wholesale Power Rate Schedule SJ-1-B
Availability: This rate schedule shall be available to Monongahela
Power Company for energy from the Stonewall Jackson Project
(hereinafter called the Project).
Applicability: This rate schedule shall be applicable to energy
made available by the Government from the Project and sold in wholesale
quantities.
Character of Service: The electric capacity and energy supplied
hereunder will be three-phase alternating current at a nominal
frequency of 60 cycles per second delivered at the delivery points of
the customer.
Monthly Rate: The monthly rate for energy made available or
delivered under this rate schedule shall be the lower of:
(a) The energy equivalent rate of Cumberland Rate Schedule CC-1-F,
which is 38.1 mills per kwh, or;
(b) The sum, as reasonably determined by Monongahela Power Company
(Buyer), of (1) and (2) below calculated for each period as to which
the determination is being made, (normally monthly) based on costs and
net generation of Buyer and other regulated subsidiaries of Allegheny
Power System, Inc. to produce energy from: Ft. Martin Units Nos. 1 and
2, Hatfield Ferry Units Nos. 1, 2, and 3, Harrison Units Nos. 1, 2, 3,
and Pleasants Units Nos. 1 and 2.
(1) The accrued expense in FERC Account 501 (fuel expense) or such
appropriate similar account as the FERC may from time to time establish
for fuel expense for steam power generation, divided by the actual net
generation in kilowatt-hours, exclusive of plan use, plus
(2) One-half of the accrued expenses in FERC Accounts 510-514
(maintenance expense), inclusive, of such other appropriate similar
accounts as FERC may from time to time establish for maintenance
expense for steam power generation, divided by the actual net
generation in kilowatt-hours, exclusive of plant use.
Energy Made Available: Project energy generated by the District at
the Project except energy use in the production of such energy or
utilized by the District for its operations at the location of the
project.
Billing Month: Buyer shall read the metering devices within three
business days of the end of each calendar month and will render payment
within 15 days of such reading.
Conditions of Service: The customer shall at its own expense
provide, install, and maintain on its side of each delivery point the
equipment necessary to protect and control its own system. In so doing,
the installation, adjustment, and setting of all such control and
protective equipment at or near the point of delivery shall be
coordinated with that which is installed by and at the expense of the
Monongahela Power Company on its side of the delivery point.
[FR Doc. 03-25501 Filed 10-7-03; 8:45 am]
BILLING CODE 6450-01-P