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Federal Register / Vol. 72, No.

219 / Wednesday, November 14, 2007 / Notices 64067

50% × Base Revenue Requirement


Base Energy = = 11.92 mills/kWh
Annual Energy

Drought Adder: A formula-based excluding timing purchases, previous deficits. For this period, effective
revenue requirement that includes purchase power drought deficits, and January 2008, the Drought Adder
future purchase power expenses interest on the purchase power drought revenue requirement is $17.5 million.

50% × Drought Adder Revenue Requirement


Drought Adder Capacity = = $1.12/kWmonth
Firm Billing Capacity

50% × Drought Adder Revenue Requirement


Drought Adder Energy = = 4.29 mills/kWh
Annual Energy

Process: Any proposed change to the placing firm power and firm peaking schedules are effective from January 1,
Base component will require a public power rates from the Pick-Sloan 2006, through December 31, 2010.
process. Missouri Basin Program—Eastern The P–SMBP—ED firm power and
The Drought Adder may be adjusted Division (P–SMBP—ED) of the Western firm peaking power rates must be
annually using the above formula for Area Power Administration (Western) increased due to the economic impact of
any costs attributed to drought of less into effect on an interim basis. The the drought, increased operation and
than or equal to the equivalent of 2 provisional rates will be in effect until maintenance and other annual
mills/kWh to the LAP composite rate. the Federal Energy Regulatory expenses, increased investments, and
Any planned incremental adjustment to Commission (FERC) confirms, approves, increased interest expense associated
the Drought Adder component greater and places them into effect on a final with drought induced deficits.
than the equivalent of 2 mills/kWh to basis or until they are replaced by other Additionally, under Rate Schedules P–
the LAP composite rate will require a rates. The provisional rates will provide SED–F9 and P–SED–FP9, Western will
public process. sufficient revenue to pay all annual identify its firm electric and firm
Adjustments: costs, including interest expense, and peaking service revenue requirements
For Drought Adder: Adjustments repay power investment and irrigation using a Base component (Base) and a
pursuant to the Drought Adder aid within the allowable periods. Drought Adder component (Drought
component will be documented in a DATES: Rate Schedules P–SED–F9 and Adder). Under Rate Schedule P–SED–
revision to this rate schedule. P–SED–FP9 will be placed into effect on F9, Western will also eliminate the
For Transformer Losses: If delivery is an interim basis on the first day of the tiered rate in P–SMBP—ED.
made at transmission voltage but first full billing period beginning on or The existing firm electric service Rate
metered on the low-voltage side of the after January 1, 2008, and will be in Schedules P–SED–F8 and P–SED–FP8
substation, the meter readings will be effect until FERC confirms, approves, are being superseded by Rate Schedules
increased to compensate for transformer and places the rate schedules in effect P–SED–F9 and P–SED–FP9. Under
losses as provided for in the contract. on a final basis ending December 31, current Rate Schedules P–SED–F8 and
For Power Factor: None. The 2012, or until the rate schedules are P–SED–FP8, a two-step method was
customer will be required to maintain a superseded. approved. The composite rate for the
power factor at all points of second step of Rate Schedules P–SED–
measurement between 95-percent FOR FURTHER INFORMATION CONTACT: Mr.
F8 and P–SED–FP8, effective on January
lagging and 95-percent leading. Robert J. Harris, Regional Manager, 1, 2007, is 19.54 mills per kilowatt hour
Upper Great Plains Region, Western (mills/kWh), the firm energy rate is
[FR Doc. E7–22191 Filed 11–13–07; 8:45 am] Area Power Administration, 2900 4th 11.29 mills/kWh, the firm capacity rate
BILLING CODE 6450–01–P Avenue North, Billings, MT 59101– is $4.45 per kilowatt month (kWmonth)
1266, telephone (406) 247–7405, e-mail and the firm peaking capacity rate is
rharris@wapa.gov, or Mr. Jon R. Horst,
DEPARTMENT OF ENERGY $4.45 per kWmonth. Under Rate
Rates Manager, Upper Great Plains
Schedule P–SED–F9, the provisional
Western Area Power Administration Region, Western Area Power
rates for firm electric services will result
Administration, 2900 4th Avenue North,
in a combined composite rate of 24.49
Pick-Sloan Missouri Basin Program— Billings, MT 59101–1266, telephone
mills/kWh. The energy rate will be
Eastern Division—Rate Order No. (406) 247–7444, e-mail horst@wapa.gov.
13.99 mills/kWh (a Base component of
EN14NO07.002</GPH> EN14NO07.003</GPH>

WAPA–135 SUPPLEMENTARY INFORMATION: The 8.93 mills/kWh and a Drought Adder


Deputy Secretary of Energy approved component of 5.06 mills/kWh) and the
AGENCY: Western Area Power existing Rate Schedules P–SED–F8 and
Administration, DOE. capacity rate will be $5.65 kWmonth (a
P–SED–FP8 for firm and firm peaking Base component of $3.65/kWmonth and
ACTION: Notice of Order Concerning electric service on an interim basis on
mstockstill on PROD1PC66 with NOTICES

Power Rates. a Drought Adder component of $2.00/


November 9, 2005.1 The existing rate kWmonth). This will result in an
SUMMARY: The Deputy Secretary of increase of 25.3 percent when compared
1 Rate Order No. WAPA–125, November 9, 2005
Energy confirmed and approved Rate (70 FR 71280). It was confirmed and approved by
with the existing firm power rate under
Order No. WAPA–135 and Rate FERC on a final basis on June 14, 2006, in Docket Rate Schedule P–SED–F8. Under Rate
EN14NO07.001</GPH>

Schedules P–SED–F9 and P–SED–FP9, No. EF06–5181–000 (115 FERC ¶ 62276). Schedule P–SED–FP9 the provisional

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64068 Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices

rates for firm peaking power consist of Flood Control Act of 1944 (16 U.S.C. Energy Charge: The rate which sets forth
a capacity charge of $5.10 per kWmonth 825s) and other Acts that specifically the charges for energy. It is expressed
and an energy charge of 13.99 mills/ apply to the project involved. in mills per kilowatthour and applied
kWh, effective on January 1, 2008. This By Delegation Order No. 00–037.00, to each kilowatthour delivered to each
will result in an increase of 14.6 percent effective December 6, 2001, the customer.
when compared with the existing firm Secretary of Energy delegated: (1) The FERC: Federal Energy Regulatory
peaking power rate under Rate Schedule authority to develop power and Commission.
P–SED–FP8. transmission rates to Western’s Firm: A type of product and/or service
By Delegation Order No. 00–037.00, Administrator; (2) the authority to available at the time requested by the
effective December 6, 2001, the confirm, approve, and place such rates customer.
Secretary of Energy delegated: (1) The into effect on an interim basis to the FRN: Federal Register notice.
authority to develop power and Deputy Secretary of Energy; and (3) the Fry-Ark: Fryingpan-Arkansas Project.
transmission rates to Western’s authority to confirm, approve, and place FY: Fiscal year; October 1 to September
Administrator; (2) the authority to into effect on a final basis, to remand or 30.
confirm, approve, and place such rates to disapprove such rates to FERC. kW: Kilowatt—the electrical unit of
into effect on an interim basis to the Existing DOE procedures for public capacity that equals 1,000 watts.
Deputy Secretary of Energy; and (3) the participation in power rate adjustments kWh: Kilowatthour—the electrical unit
authority to confirm, approve, and place (10 CFR part 903) were published on of energy that equals 1,000 watts in 1
into effect on a final basis, to remand or September 18, 1985. hour.
to disapprove such rates to FERC. kWmonth: Kilowattmonth—the
Existing DOE procedures for public Acronyms and Definitions electrical unit of the monthly amount
participation in power rate adjustments As used in this Rate Order, the of capacity.
(10 CFR part 903) were published on following acronyms and definitions LAP: Loveland Area Projects.
September 18, 1985. apply: Load Factor: The ratio of average load in
Under Delegation Order Nos. 00– Administrator: The Administrator of the kW supplied during a designated
037.00 and 00–001.00C, 10 CFR part Western Area Power Administration. period to the peak or maximum load
903, and 18 CFR part 300, I hereby Base: Revenue requirement component in kW occurring in that period.
confirm, approve, and place Rate Order of the power rate including annual mills/kWh: Mills per kilowatthour—the
No. WAPA–135, the proposed P– operation and maintenance expenses, unit of charge for energy (equal to one
SMBP—ED firm power and firm peaking investment repayment and associated tenth of a cent or one thousandth of
power rates, into effect on an interim interest, normal timing power a dollar.)
basis. The new Rate Schedules P–SED– purchases, and transmission costs. MW: Megawatt—the electrical unit of
F9 and P–SED–FP9 will be promptly Capacity: The electric capability of a capacity that equals 1 million watts or
submitted to FERC for confirmation and generator, transformer, transmission 1,000 kilowatts.
approval on a final basis. circuit, or other equipment. It is NEPA: National Environmental Policy
Dated: November 1, 2007. expressed in kilowatts. Act of 1969 (42 U.S.C. 4321, et seq.).
Capacity Charge: The rate which sets Non-timing Power Purchases: Power
Clay Sell,
forth the charges for capacity. It is purchases that are not related to
Deputy Secretary of Energy. operational constraints such as
expressed in dollars per kWmonth.
Department of Energy, Deputy Composite Rate: The rate for management of endangered species,
Secretary commercial firm power which is the species habitat, water quality,
total annual revenue requirement for navigation, control area purposes, etc.
[Rate Order No. WAPA–135]
capacity and energy divided by the O&M: Operation and Maintenance.
In the matter of: Western Area Power total annual energy sales. It is P–SMBP: The Pick-Sloan Missouri Basin
Administration Rate Adjustment for the expressed in mills per kilowatthour Program.
Pick-Sloan Missouri Basin Program— and used for comparison purposes. P–SMBP—ED: Pick-Sloan Missouri
Eastern Division Corps: United States Army Corps of Basin Program—Eastern Division.
Engineers. P–SMBP—WD: Pick-Sloan Missouri
Order Confirming, Approving, and Basin Program—Western Division.
Placing the Pick-Sloan Missouri Basin CROD: Contract rate of delivery. The
maximum amount of capacity made Power: Capacity and energy.
Program—Eastern Division Firm Power Power Factor: The ratio of real to
and Firm Peaking Power Service Rates available to a preference customer for
a period specified under a contract. apparent power at any given point
Into Effect on an Interim Basis and time in an electrical circuit.
Customer: An entity with a contract that
These rates for the Pick-Sloan is receiving service from Western’s Generally it is expressed as a
Missouri Basin Program—Eastern Upper Great Plains Region. percentage ratio.
Division were established in accordance Deficits: Deferred or unrecovered annual Preference: The requirements of
with section 302 of the Department of expenses. Reclamation Law which provide that
Energy (DOE) Organization Act (42 DOE: United States Department of preference in the sale of Federal
U.S.C. 7152). This Act transferred to and Energy. power shall be given to municipalities
vested in the Secretary of Energy the DOE Order RA 6120.2: An order and other public corporations or
power marketing functions of the outlining power marketing agencies and also to cooperatives and
Secretary of the Department of the administration financial reporting and other nonprofit organizations
Interior and the Bureau of Reclamation rate-making procedures. financed in whole or in part by loans
mstockstill on PROD1PC66 with NOTICES

under the Reclamation Act of 1902 (ch. Drought Adder: Formula based revenue made under the Rural Electrification
1093, 32 Stat. 388), as amended and requirement component including Act of 1936 (Reclamation Project Act
supplemented by subsequent laws, costs associated with the drought. of 1939, section 9(c), 43 U.S.C.
particularly section 9(c) of the Energy: Measured in terms of the work 485h(c)).
Reclamation Project Act of 1939 (43 it is capable of doing over a period of Provisional Rate: A rate which has been
U.S.C. 485h(c)) and section 5 of the time. It is expressed in kilowatthours. confirmed, approved and placed into

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Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices 64069

effect on an interim basis by the information and public comment Lyon-Lincoln Electric Cooperative,
Deputy Secretary. forums. Minnesota.
PRS: Power Repayment Study. 3. On June 1, 2007, Western’s UGPR Marshall Municipal Utilities,
Rate Brochure: A June 2007 document mailed letters to all P–SMBP—ED Minnesota.
explaining the rationale and preference customers and interested Mid-West Electric Consumers
background for the rate proposal parties transmitting the FRN published Association, Colorado.
contained in this Rate Order. on May 31, 2007. Minnkota Power Cooperative, Inc.,
Reclamation: United States Department 4. On June 18, 2007, beginning at 10 North Dakota.
of the Interior, Bureau of Reclamation. a.m. (MDT), Western held a public Montana Electric Cooperatives’
Reclamation Law: A series of Federal information forum at the Radisson Association, Montana.
laws. Viewed as a whole, these laws Stapleton Plaza in Denver, Colorado. On Municipal Energy Agency of Nebraska,
create the originating framework June 19, 2007, beginning at 9 a.m. Nebraska.
under which Western markets power. (CDT), a second public information Nebraska Public Power District,
Revenue Requirement: The revenue forum was held at the Holiday Inn in Nebraska.
required to recover annual expenses Sioux Falls, South Dakota. Western Northwest Iowa Power Cooperative,
(such as O&M, purchase power, provided detailed explanations of the Iowa.
transmission service expenses, proposed rates for P–SMBP—ED, and a Renville Sibley Cooperative Power
interest and deferred expenses) and list of issues that could change the Association, Minnesota.
repay Federal investments and other proposed rates. Western also answered Rosebud Electric Cooperative, South
assigned costs. questions and gave notice that more Dakota.
RMR: The Rocky Mountain Customer information was available in the rate Sioux Valley Energy, South Dakota.
Service Region of Western. Sisseton-Wahpeton Oyate, Lake
brochure.
Timing Power Purchases: Power Traverse Reservation, South Dakota.
5. On July 23, 2007, beginning at 10
purchases that are due to operational South Dakota Rural Electric Association,
a.m. (MDT), Western held a public
constraints (e.g. management of South Dakota.
comment forum at the Radisson Town of Julesburg, Colorado.
endangered species, species habitat, Stapleton Plaza in Denver, Colorado, to
water quality, navigation, control area Verendrye Electric Cooperative, North
give the public an opportunity to Dakota.
purposes, etc.) and not associated comment for the record. No oral or
with the drought. Woodbury Rural Electric Cooperative,
written comments were received at this Iowa.
UGPR: The Upper Great Plains forum. On July 24, 2007, beginning at 9
Customer Service Region of Western. a.m. (CDT), a second public comment Project Description
Western: United States Department of
forum was held at the Holiday Inn in The P–SMBP was authorized by
Energy, Western Area Power
Sioux Falls, South Dakota, to give the Congress in section 9 of the Flood
Administration.
public an opportunity to comment for Control Act of December 22, 1944,
Effective Date the record. No oral or written comments commonly referred to as the 1944 Flood
The new provisional rates will take were received at this forum. Control Act. This multipurpose program
effect on the first day of the first full 6. Western’s UGPR provided a Web provides flood control, irrigation,
billing period beginning on or after site with all of the letters, time frames, navigation, recreation, preservation and
January 1, 2008, and will remain in dates and locations of forums, enhancement of fish and wildlife, and
effect until December 31, 2012, pending documents discussed at the information power generation. Multipurpose
approval by FERC on a final basis. meetings, FRNs, rate brochure, and all projects have been developed on the
other information about this rate process Missouri River and its tributaries in
Public Notice and Comment for easy customer access. The Web site Colorado, Montana, Nebraska, North
Western followed the Procedures for is located at http://www.wapa.gov/ugp/ Dakota, South Dakota and Wyoming.
Public Participation in Power and rates/2008FirmRateAdjust. In addition to the multipurpose water
Transmission Rate Adjustments and 7. Western received 25 comment projects authorized by section 9 of the
Extensions, 10 CFR part 903, in letters during the consultation and Flood Control Act of 1944, certain other
developing these rates. The steps comment period, which ended August existing projects have been integrated
Western took to involve interested 29, 2007. All formally submitted with the P–SMBP for power marketing,
parties in the rate process were: comments have been considered in operation and repayment purposes. The
1. The proposed rate adjustment preparing this Rate Order. Colorado-Big Thompson, Kendrick, and
process began March 15, 2007, when Comments Shoshone Projects were combined with
Western’s UGPR mailed a notice the P–SMBP in 1954, followed by the
announcing informal customer meetings Written comments were received from North Platte Project in 1959. These
to all P–SMBP—ED preference the following organizations: projects are referred to as the
customers and interested parties. The City of Gering, Nebraska. ‘‘Integrated Projects’’ of the P–SMBP.
informal meetings were held on April 9, City of Wisner, Nebraska. The Flood Control Act of 1944 also
2007, in Denver, Colorado, and on April Central Power Electric Cooperative, Inc., authorized the inclusion of the Fort
10, 2007, in Sioux Falls, South Dakota. North Dakota. Peck Project with the P–SMBP for
At these informal meetings, Western Corn Belt Power Cooperative, Iowa. operation and repayment purposes. The
explained the rationale for the rate East River Electric Power Cooperative, Riverton Project was integrated with the
adjustment, presented rate designs and South Dakota. P–SMBP in 1954, and in 1970 was
mstockstill on PROD1PC66 with NOTICES

methodologies, and answered questions. Federated Rural Electric, Minnesota. reauthorized as a unit of P–SMBP.
2. An FRN was published on May 31, Heartland Consumers Power District, The P–SMBP is administered by two
2007 (72 FR 30372), that announced the South Dakota. regions. The UGPR with a regional
proposed rates for P–SMBP—ED, began Lincoln Electric System, Nebraska. office in Billings, Montana, markets
a public consultation and comment Lower Yellowstone Rural Electric power from the Eastern Division of P–
period, and announced the public Cooperative, Montana. SMBP, and the RMR with a regional

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64070 Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices

office in Loveland, Colorado, markets DOE Order RA 6120.2, a revised study Western will repay deficits and also
the Western Division power of P–SMBP. and rate adjustment has been developed make previously planned payments for
The UGPR markets power in western to demonstrate that sufficient revenues irrigation assistance and other
Iowa, western Minnesota, Montana east will be collected under proposed rates investments that are due within the
of the Continental Divide, North Dakota, to meet future obligations. required repayment period. Prepaying
South Dakota, and the eastern two- Under this adjustment, payments irrigation and capital investments has
thirds of Nebraska. The RMR markets P– toward irrigation assistance and capital been part of the P–SMBP repayment
SMBP—WD power, which in debt are necessary before deficits are plans and approved rate adjustments for
combination with Fry-Ark power is completely repaid. Traditionally, the past 20 years. Prepayment is an
known as LAP power, in northeastern prepayment of irrigation assistance or integral part of the long-term plan for
Colorado, east of the Continental Divide capital is only done in the absence of the project and has provided rate
in Wyoming, west of the 101st meridian deficits. However, if all revenue were stability for consumers while meeting
in Nebraska, and most of Kansas. The P– applied toward deficits prior to making Federal repayment obligations. Modest
SMBP power is marketed to any payments for irrigation and other irrigation and investment payments for
approximately 300 firm power capital requirements, an extraordinarily a brief period of 2 to 3 years will reduce
customers by the UGPR and large rate increase to meet single-year the single-year revenue requirement for
approximately 40 firm power customers repayment obligations would be irrigation assistance and hold increases
by the RMR. required. Once these single-year to the ‘‘lowest possible rates to
repayment obligations were satisfied, consumers consistent with sound
Power Repayment Study—Firm Power business principles,’’ as outlined in
another rate adjustment would be
Rate section 5 of the Flood Control Act of
necessary to decrease the rates. While
Western prepares a PRS each FY to repayment of capital debt and irrigation 1944.
determine if revenues will be sufficient assistance prior to complete repayment Existing and Provisional Rates
to repay, within the required time, all of deficits is not typical, the approach
approved within this Rate Order is well A comparison of the existing and
costs assigned to the P–SMBP.
within the bounds of the discretion provisional firm power and firm
Repayment criteria are based on law,
allowed under DOE Order RA 6120.2. peaking power rates follow:
policies including DOE Order RA
6120.2, and authorizing legislation. To Under the adjustment in power rate Comparison of Existing and Provisional
meet cost recovery criteria outlined in schedules P–SED–F9 and P–SED–FP9, Rates

PICK-SLOAN MISSOURI BASIN PROGRAM—EASTERN DIVISION


Provisional rates effective January 1,
Firm electric service Existing rates effective January 1, 2007 Percent change
2008

P–SMBP—ED Revenue Requirement ... $189.9 million ......................................... $235.9 million ......................................... 24.2
P–SMBP—ED Composite Rate ............. 19.54 mills/kWh ...................................... 24.49 mills/kWh ...................................... 25.3
Firm Capacity ......................................... $4.45/kWmonth ...................................... $5.65/kWmonth ...................................... 27.0
Firm Energy ............................................ 11.29 mills/kWh ...................................... 13.99 mills/kWh ...................................... 23.9
Tiered > 60 Percent Load Factor ........... 5.21 mills/kWh ........................................ Eliminated .............................................. N/A
Firm Peaking Capacity ........................... $4.45/kWmonth ...................................... $5.10/kWmonth ...................................... 14.6
Firm Peaking Energy 1 ........................... 11.29 mills/kWh ...................................... 13.99 mills/kWh ...................................... 23.9
1Firm Peaking Energy is normally returned. This rate will be assessed in the event Firm Peaking Energy is not returned.

Western Division P–SMBP—ED Firm Power Rate rates under P–SED–F9 for firm power
Discussion consist of a capacity charge of $5.65/
The LAP rate is designed to recover kWmonth, and an energy charge of
the P–SMBP—WD revenue requirement According to Reclamation Law,
Western must establish power rates 13.99 mills/kWh. The provisional rates
for the P–SMBP and the revenue under P–SED–FP9 for firm peaking
sufficient to recover operation,
requirement for Fry-Ark. The maintenance, purchased power and power consist of a capacity of $5.10/
adjustment to the LAP rate is a separate interest expenses, and repay power kWmonth, and an energy charge of
formal rate process which is investment and irrigation aid. 13.99 mills/kWh. These rates are
documented in Rate Order No. WAPA– The P–SMBP—ED firm power and comprised of Base and Drought Adder
134. Rate Order No. WAPA–134 is also firm peaking power rates must be components.
scheduled to go into effect on the first increased due to the economic impact of Additionally, under Rate Schedules
day of the first full billing period the drought, increased O&M and other P–SED–F9 and P–SED–FP9, Western
beginning on January 1, 2008. annual expenses, increased investments, will identify its firm and firm peaking
and increased interest expense electric service revenue requirements
Certification of Rates associated with deficits. using Base and Drought Adder
The existing rates for P–SMBP—ED components. The Base is a revenue
Western’s Administrator certified that
firm power and firm peaking power requirement that includes annual O&M
the provisional rates for P–SMBP—ED
under Rate Schedules P–SED–F8 and P– expenses, investment repayment and
firm power and firm peaking power
mstockstill on PROD1PC66 with NOTICES

SED–FP8 expire December 31, 2010. associated interest, normal timing


rates are the lowest possible rates power purchases, and transmission
Effective January 1, 2008, Rate
consistent with sound business Schedules P–SED–F8 and P–SED–FP8 costs. Normal timing power purchases
principles. The provisional rates were will be superseded by the new rates in are purchases due to operational
developed following administrative Rate Schedule P–SED–F9 and Rate constraints (e.g., management of
policies and applicable laws. Schedule P–SED–FP9. The provisional endangered species habitat, water

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Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices 64071

quality, navigation, control area non-timing power purchases made Requirement. Under this provisional
purposes, etc.) and are not associated during this drought, and the interest rate, the P–SMBP—ED annual revenue
with the current drought in the region. associated with previously incurred and requirement equals $245.2 million and
The Base revenue requirement may not future drought debt. The Drought Adder is comprised of a Base revenue
be adjusted without Western going is designed to repay drought debt within requirement of $157.2 million plus a
through a public process to do so. 10 years of the year the debt was Drought Adder revenue requirement of
The Drought Adder revenue incurred. Adjustments to the Drought $88.0 million. Both the Base and the
requirement is a formula-based revenue Adder of less than or equal to the Drought Adder recover portions of the
requirement that includes costs equivalent of 2 mills/kWh to the PRS firm power revenue requirement, which
attributable to the present drought composite rate will be made by
when combined with the firm peaking
conditions within the P–SMBP. The customer notification of a revised rate
Drought Adder includes costs associated power revenue requirement equals the
schedule with a January implementation
with future non-timing power purchases date. P–SMBP—ED annual revenue
of additional power to firm obligations The annual revenue requirement requirement.
not covered with available system calculation can be summarized by the Below is a table identifying the rates
generation due to the drought, following formula: Annual Revenue for the revenue requirement
previously incurred deficits due to Requirement = Base Revenue components:
purchased power debt incurred from Requirement + Drought Adder Revenue

Drought
Base adder
Service compo- Rates
compo-
nent nent

Firm Capacity ($/kWmonth) ................................................................................................................................. $3.65 $2.00 $5.65


Firm Energy (mills/kWh) ...................................................................................................................................... 8.93 5.06 13.99
Firm Peaking Capacity ($/kWmonth) ................................................................................................................... $3.25 $1.85 $5.10
Firm Peaking Energy (mills/kWh) 1 ...................................................................................................................... 8.93 5.06 13.99
1 Firm Peaking Energy is normally returned. This rate will be assessed in the event Firm Peaking Energy is not returned.

Western reviews its firm electric customers by letter in October of the Western has also redesigned its
service rates annually. Western will planned adjustment and implement the revenue recovery methodology for firm
review the Base after the annual PRS is adjustment in the following January peaking service. Under Rate Schedule
completed, generally in the first quarter billing cycle. For the portion of any P–SED–FP9, the firm peaking demand
of the calendar year. If an adjustment to planned incremental adjustment greater charge is calculated by dividing one-half
the Base is necessary, Western will than the equivalent of 2 mills/kWh to of the P–SMBP—ED revenue
initiate a public process pursuant to 10 the PRS composite rate, Western will requirement by the sum of the total
CFR part 903 prior to making an engage in a public process pursuant to allocated seasonal CRODs modeled as
adjustment. 10 CFR part 903 prior to implementing monthly billing units for both firm
Western will review the Drought that portion of the adjustment. Although electric and firm peaking service.
Adder each September to determine if decremental adjustments to the Drought
Statement of Revenue and Related
drought costs differ from those projected Adder may occur, the adjustment
Expenses
in the PRS and whether an adjustment cannot result in the Drought Adder
to the Drought Adder is necessary. being a negative number. Western will The following table provides a
Western will use recent Corps of conduct a preliminary review of the summary of projected revenue and
Engineers and Bureau of Reclamation Drought Adder in early summer and expense data for the total P–SMBP,
hydrological estimates and historical advise customers by letter of any including both the Eastern and Western
data to determine the estimated estimated change to the Drought Adder Divisions, firm electric service revenue
amounts for future purchase power for the following January. Customers requirement through the 5-year rate
costs. For any adjustments attributed to will also be notified by letter in October approval period. The firm power rates
drought costs of less than or equal to the of the final Drought Adder adjustment for both divisions have been developed
equivalent of 2 mills/kWh to the PRS to be effective with the following with the following revenues and
composite rate, Western will notify January billing period. expenses for the P–SMBP:

TOTAL P–SMBP FIRM POWER COMPARISON OF 5-YEAR RATE PERIOD (FY 2008–2012)
Difference
Existing rate Proposed rate ($000)
($000) ($000) Total revenues
and expenses

Total Revenues ............................................................................................................................ $1,723,061 $2,127,445 $404,384


Revenue Distribution
Expenses:
mstockstill on PROD1PC66 with NOTICES

O&M ...................................................................................................................................... 829,319 910,948 81,629


Purchased Power and Wheeling .......................................................................................... 84,040 290,654 206,614
Integrated Projects Requirements ........................................................................................ 0 0 0
Interest .................................................................................................................................. 499,116 530,912 31,796
Transmission ........................................................................................................................ 58,956 60,856 1,900

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64072 Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices

TOTAL P–SMBP FIRM POWER COMPARISON OF 5-YEAR RATE PERIOD (FY 2008–2012)—Continued
Difference
Existing rate Proposed rate ($000)
($000) ($000) Total revenues
and expenses

Total Expenses .............................................................................................................. 1,471,431 1,793,370 321,939

Principal Payments:
Capitalized Expenses ........................................................................................................... 218,819 127,958 (90,861)
Original Project and Additions .............................................................................................. 26,392 188,898 162,506
Replacements ....................................................................................................................... 2,019 2,219 200
Irrigation ................................................................................................................................ 4,400 15,000 10,600

Total Principal Payments .............................................................................................. 251,630 334,075 82,445

Total Revenue Distribution ............................................................................................ 1,723,061 2,127,445 404,384

Basis for Rate Development One customer may return all peaking peaking power rates are paraphrased for
The existing rates for P–SMBP—ED energy, while another peaking customer brevity when not affecting the meaning
firm power in Rate Schedule P–SED–F8, may pay for 20 to 40 percent of the of the statement(s). Direct quotes from
which expire December 31, 2010, no peaking energy they use and return the comment letters are used for
longer provide sufficient revenues to rest to Western. When a peaking clarification when necessary.
pay all annual costs, including interest customer does not return peaking A. Comment: Western received
expense, and repay investment and energy, they are billed at the firm energy numerous comments that strongly
irrigation aid within the allowable rate. supported Western’s rate adjustment
period. The adjusted rates reflect Previously, Western used the sum of proposal. These comments support the
increases due to the economic impact of the metered billing units for firm establishment of a Drought Adder and
the drought, increased O&M and other electric service and the seasonal CROD Base component as it will ensure timely
annual expenses, increased investments, modeled as monthly billing units for repayment of obligations to the Treasury
and increased interest expense firm peaking service. Western is while insulating the Base from inflation
associated with drought deficits. The changing the methodology for the firm brought about by drought related costs.
provisional rates will provide sufficient peaking rate design to use the sum of Comments expressed support for
revenue to pay all annual costs, the total allocated seasonal CRODs for elimination of the tiered rate because it
including interest expense, and repay both firm electric demand and firm has penalized customers for making
power investment and irrigation aid peaking demand modeled as billing efficient use of renewable energy
within the allowable periods. The units. Changing the methodology is resources that do not contribute to
provisional rates will take effect on consistent with the principle that global warming. Comments also
January 1, 2008, to correspond with the Western’s rate design for firm electric supported the redesign of the peaking
start of the calendar year, and will demand and firm peaking demand rate as it better reflects the value and
remain in effect on an interim basis, should be representative of the different limitations of the peaking product.
pending FERC’s confirmation and products. The firm peaking rate under Response: Western appreciates
approval of them or substitute rates on P–SED–FP9 is $5.10/kWmonth. The customer support received for the rate
a final basis, through December 31, revenue requirement for firm peaking adjustment proposal, including
2012. demand is calculated by multiplying the separation of the annual revenue
The P–SMBP—ED provisional firm firm peaking power billing units per requirement into a Base component and
power rate under rate schedule P–SED– year (4,272,000 kWmonth/year) by the Drought Adder component, elimination
F9 is designed to recover 50 percent of firm peaking demand rate yielding a of the tiered rate and redesign of the
the revenue requirement from the firm peaking revenue requirement of peaking rate.
capacity rate and 50 percent from the $21.8 million. B. Comment: Western received one
energy rate. The firm capacity rate of With this rate adjustment, the P– comment opposed to the elimination of
$5.65 per kWmonth is calculated by SMBP—ED is also eliminating the tiered the tiered rate. ‘‘It appears to me to be
dividing 50 percent of the total annual rate. The tiered rate charge was a push put on by those systems with
revenue by the total firm power billing implemented in the mid-1970s for loads load management systems. They manage
units (kWmonths) in a year. The firm in excess of 60 percent monthly load their peaks & thus buy more power in
energy rate of 13.99 mills/kWh is factor. Continuing the tiered rate charge the over 60% load factor range. The
calculated by dividing 50 percent of the discourages load management. systems that do not use load control
total annual revenue requirement by the Moreover, eliminating the tiered rate helped pay for the load control systems
annual energy sales. from the P–SMBP—ED firm electric of those that do & now they are asking
Historically, the P–SMBP—ED firm service schedule is consistent with the us to pay again.’’
peaking rate has been equal to the administration of firm electric service Response: P–SMBP—ED customers
demand charge for the firm power rate. rates in the P–SMBP—WD, as well as all that have load management systems in
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The customer pays the demand rate on other Western regions, which do not place have paid for those systems
their total firm peaking CROD each assess a tiered rate charge. themselves. Western has not recovered
month rather than firm energy peaking costs for load management systems of
delivered each month. Contract terms Comments others nor has Western passed those
vary among firm peaking customers The comments and responses below costs on to customers that do not have
with respect to return of peaking energy. regarding the firm power and firm load management systems. Western

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Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices 64073

does not charge a tiered rate in the P– include the most current hydrological term purchases by Western have been
SMBP—WD nor in any other projects and operations cost data into projections curtailed, causing additional drought-
marketed by Western. Western in the PRS as soon as they are available related expenses as higher cost energy is
endeavors to treat customers fairly and and will notify customers as soon as generated or purchased to replace the
we believe penalizing customers for practical of any changes to the Drought curtailed purchases in real time.
efficient management is unjust. Adder. Response: This comment is not
Furthermore, penalizing customers for F. Comment: Many comments directly related to the proposed rate
managing the load on their power supported the increase in rates, action and is outside the scope of this
system is unreasonable in an era when recognizing Western’s need to generate rate process. However, Western is
use of renewable energy is at the added revenue in order to meet its actively addressing these issues as well
forefront of efficient energy operations and repayment obligations as other options and evaluating them
management. due to pressure from the long-term based on cost and benefit to Western’s
C. Comment: Western received one drought affecting the Missouri River customers.
comment opposed to the proposed firm Basin. J. Comment: Commenters state that
peaking capacity rate and the proposed Response: Western appreciates the one area of controllable cost that causes
peaking energy charge. The percentage customer support it has received for the significant concern is the area of
increase for the firm peaking capacity is rate adjustment proposal. regional transmission. The commenters
only 14.6% compared to the 25.3% G. Comment: Western received one understand that UGPR is considering
increase in firm power. The peaking comment that the 25% rate increase for the logistics of participating in the
energy charge of 13.99 mills/kWh seems the area utilities should not decrease the Midwest Independent Transmission
low. Tribal benefits, rather the opposite System Operator (MISO) and its Day
Response: Those customers who have should happen and Tribal benefits Two Markets. Before pursuing such a
peaking capacity pay for the service should increase due to the increased radical departure from past practice,
each month of the season for which they value of the hydro resource. they suggest a thorough review of costs
have a CROD whether they are allowed Response: Western does provide bill
and benefits to all Western customers. If
to use the capacity under the contract crediting of the Tribal benefits
Western joins MISO, and other area
terms or not. Typically, peaking according to the composite rate for the
transmission owners that also serve
capacity is used one to four times P–SMBP—ED as provided in the Tribal
Western customers do not join, there
annually by the peaking customers, thus contracts. Native American contractual
could be significant seams issues. If
paying monthly for a product they are arrangements do allow for the
there are benefits to participating in the
not allowed to use. Western’s new composite rate to be modified. Under
Day Two Market, those benefits should
peaking rate is reflective of the peaking this rate adjustment, the composite rate
flow to all Western customers, not just
customer’s historical usage and their for P–SMBP—ED is increasing from
those that participate in joint
impact on drought costs. Western 19.54 mills per kWh to 24.49 mills per
dispatching arrangements inside the
believes we have treated both the firm kWh. Benefits to a Tribe are determined
Integrated System.
and firm peaking customers equitably from the difference between the
Response: This comment is not
by separating the rate designs of the two composite rate for Western and the
directly related to the proposed rate
products. This separation is composite rate of the power supplier the
action and is outside the scope of this
demonstrated in the new peaking Tribe has designated. As Western’s
rate process. However, Western is
product rate design which better reflects composite rate increases, it is likely that
actively addressing these issues as well
the value and restrictions of the peaking the composite rates for the Tribes
as other options and evaluating them
product. designated power suppliers will
based on cost and benefit to Western’s
D. Comment: Western received increase as well, although such increase
customers.
numerous comments encouraging is not within the control of Western. (In
Western to include identification of the addition, this comment pertains to Availability of Information
portion of the total rate which will be contract administration and is outside Information about this rate
attributed to the Drought Adder and that the scope of this rate process.) adjustment, including the PRS,
such amount be identified in terms of H. Comment: Two comments received
comments, letters, memorandums and
both the energy and capacity rates. expressed appreciation for Western’s
other supporting material made or kept
Response: Western agrees with this commitment to supply the full firm
by Western that was used to develop the
request to identify the portion of the rate power allocation during this drought
provisional rates, is available for public
attributable to the Drought Adder and cycle. However, there is also concern
review in the Upper Great Plains
has identified both the Base component that adequate long term purchase power
Regional Office, Western Area Power
and Drought Adder component in arrangements have not been pursued by
Administration, 2900 4th Avenue North,
energy and capacity rates in the firm Western, leaving UGPR to continually
Billings, Montana.
and firm peaking rate schedules. rely on short-term, spot market energy
E. Comment: Western received several purchases to meet its shortfall. Ratemaking Procedure Requirements
comments encouraging Western to keep Response: Although this comment is
Environmental Compliance
preference customers informed not directly related to the proposed rate
throughout the year on the progress action and is outside the scope of this In compliance with the National
made in paying down the drought rate process, Western is actively Environmental Policy Act of 1969
deficits and provide early and timely addressing these issues as well as other (NEPA) (42 U.S.C. 4321, et seq.); the
information to customers on any options and evaluating them based on Council on Environmental Quality
mstockstill on PROD1PC66 with NOTICES

changes to the Drought Adder so cost and benefit to Western’s customers. Regulations for implementing NEPA (40
customers can plan accordingly. I. Comment: Commenters state that by CFR parts 1500–1508); and DOE NEPA
Response: Western intends to inform relying on non-firm transmission for Implementing Procedures and
customers annually of the status of the spot energy purchases, the likelihood of Guidelines (10 CFR part 1021, Subpart
drought costs and the repayment of curtailments is increased. It is their D, App. B4.3), Western has determined
those costs. It is Western’s intention to understanding that a number of short- that this action is categorically excluded

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64074 Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices

from preparing an environmental Missouri Basin Program—Eastern Available: Within the marketing area
assessment or an environmental impact Division of the Western Area Power served by the Eastern Division of the Pick-
statement. Administration. The rate schedules Sloan Missouri Basin Program.
shall remain in effect on an interim Applicable: To the power and energy
Determination Under Executive Order delivered to customers as firm power service.
12866 basis, pending FERC’s confirmation and
approval of them or substitute rates on Character: Alternating current, 60 hertz,
Western has an exemption from a final basis through December 31, 2012. three phase, delivered and metered at the
centralized regulatory review under voltages and points established by contract.
Dated: November 1, 2007.
Executive Order 12866; accordingly, no Monthly Rates:
clearance of this notice by the Office of Clay Sell, Demand Charge: $5.65 for each kilowatt
Management and Budget is required. Deputy Secretary of Energy. per month (kWmonth) of billing demand.
Rate Schedule P–SED–F9 Energy Charge: 13.99 mills per
Submission to the Federal Energy (Supersedes Schedule P–SED–F8) kilowatthour (kWh) for all energy delivered
Regulatory Commission Effective January 1, 2008 as firm power service.
The provisional rates herein United States Department of Energy, Billing Demand: The billing demand will
confirmed, approved, and placed into Western Area Power Administration be as defined by the power sales contract.
effect, together with supporting Charge Components:
documents, will be submitted to FERC Pick-Sloan Missouri Basin Program— Base: A fixed revenue requirement that
for confirmation and final approval. Eastern Division, Montana, North Dakota, includes operation and maintenance
South Dakota, Minnesota, Iowa, Nebraska
expense, investments and replacements,
Order
Schedule of Rates for Firm Power Service interest on investments and replacements,
In view of the foregoing and under the (Approved Under Rate Order No. WAPA– normal timing purchase power costs
authority delegated to me, I confirm and 135) (purchases due to operational constraints, not
approve on an interim basis, effective Effective: The first day of the first full associated with drought), and transmission
January 1, 2008, Rate Schedules P–SED– billing period beginning on or after January costs. The Base revenue requirement is
F9 and P–SED–FP9 for the Pick-Sloan 1, 2008, through December 31, 2012. $157.2 million.

50% × Base Revenue Requirement


Base Demand = = $3.65/kWmonth.
Firm Metered Billing Units

50% × Base Revenue Requirement


Base Energy = = 8.93 mills/kWh.
Annual Energy

Drought Adder: A formula-based revenue previous purchase power drought deficits, 2008, the Drought Adder revenue
requirement that includes future purchase and interest on the purchase power drought requirement is $88 million.
power expense excluding timing purchases, deficits. For the period beginning January

50% × Drought Adder Revenue Requirement


Drought Adder Demand = = $2.00 /kWmonth.
Firm Metered Billing Units

50% × Drought Adder Revenue Requirement


Drought Adder Energy = = 5.06 mills/kWh.
Annual Energy

Process: Any proposed change to the Base transmission voltage may in some instances Rate Schedule P–SED–FP9
component will require a public process. be eligible to receive a 5 percent discount on (Supersedes Schedule P–SED–FP8)
The Drought Adder component may be demand and energy charges when facilities Effective January 1, 2008 EN14NO07.007</GPH>

adjusted annually using the above formula are provided by the customer that results in
for any costs attributed to drought of less United States Department of Energy,
a sufficient savings to Western to justify the Western Area Power Administration
than or equal to the equivalent of 2 mills/ discount. The determination of eligibility for
kWh to the Power Repayment Study (PRS) receipt of the voltage discount shall be Pick-Sloan Missouri Basin Program—
composite rate. Any planned incremental Eastern Division, Montana, North Dakota,
EN14NO07.005</GPH> EN14NO07.006</GPH>

exclusively vested in Western.


adjustment to the Drought Adder component South Dakota, Minnesota, Iowa, Nebraska
For Billing of Unauthorized Overruns: For
greater than the equivalent of 2 mills/kWh to
the PRS composite rate will require a public each billing period in which there is a Schedule of Rates for Firm Peaking Power
process. contract violation involving an unauthorized Service (Approved Under Rate Order No.
overrun of the contractual firm power and/ WAPA–135)
mstockstill on PROD1PC66 with NOTICES

Adjustments:
For Drought Adder: Adjustments pursuant or energy obligations, such overrun shall be Effective: The first day of the first full
to the Drought Adder component will be billed at 10 times the above rate. billing period beginning on or after January
documented in a revision to this rate For Power Factor: None. The customer will 1, 2008, through December 31, 2012.
schedule. be required to maintain a power factor at the Available: Within the marketing area
For Character and Conditions of Service: point of delivery between 95 percent lagging served by the Eastern Division of the Pick-
EN14NO07.004</GPH>

Customers who receive deliveries at and 95 percent leading. Sloan Missouri Basin Program, to customers

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Federal Register / Vol. 72, No. 219 / Wednesday, November 14, 2007 / Notices 64075

with generating resources enabling them to Demand Charge: $5.10 for each kilowatt Base: A fixed revenue requirement that
use firm peaking power service. per month (kWmonth) of the effective includes operation and maintenance
Applicable: To the power sold to contract rate of delivery for peaking power or expense, investment and replacements,
customers as firm peaking power service. the maximum amount scheduled, whichever normal timing purchase power costs
is greater.
Character: Alternating current, 60 hertz, (purchases due to operational constraints, not
Energy Charge: 13.99 mills for each
three phase, delivered and metered at the kilowatthour (kWh) for all energy scheduled associated with drought), and transmission
voltages and points established by contract. for delivery without return. costs. The Base peaking revenue requirement
Monthly Rates: Charge Components: is $13.9 million.

Base Peaking Demand Revenue Requirement


Base Demand = = $3.25/kWmonth.
Peaking CROD Billing Units

Energy 1: = 8.93 mills/kWh. power above timing purchases, previous the period beginning January 2008, the
Drought Adder: A formula-based revenue purchase power drought deficits, and interest Drought Adder peaking revenue requirement
requirement that includes future purchase on the purchase power drought deficits. For is $7.9 million.

Drought Adder Peaking Demand Revenue Requirement


Drought Adder Demand = = $1.85/kWmonth.
Peaking CROD Billing Units

Energy 1: = 5.06 mills/kWh. ENVIRONMENTAL PROTECTION • Federal eRulemaking Portal: http://


Process: Any proposed change to the Base AGENCY www.regulations.gov. Follow the on-line
component will require a public process. instructions for submitting comments.
The Drought Adder component may be [EPA–HQ–OPPT–2007–0716; FRL–8144–6]
• Mail: Document Control Office
adjusted annually using the above formula (7407M), Office of Pollution Prevention
for any costs attributed to drought of less Agency Information Collection and Toxics (OPPT), Environmental
than or equal to the equivalent of 2 mills/ Activities; Proposed Collection; Protection Agency, 1200 Pennsylvania
kWh to the Power Repayment Study (PRS) Comment Request; TSCA Section 4 Ave., NW., Washington, DC 20460–
composite rate. Any planned incremental Test Rules, Consent Orders, Test Rule 0001.
adjustment to the Drought Adder component Exemptions, and Voluntary Data • Hand Delivery: OPPT Document
greater than the equivalent of 2 mills/kWh to Submission; EPA ICR No. 1139.08, Control Office (DCO), EPA East, Rm.
the PRS composite rate will require a public OMB Control No. 2070–0033 6428, 1201 Constitution Ave., NW.,
process. Washington, DC. Attention: Docket ID
Billing Demand: The billing demand will AGENCY: Environmental Protection Number EPA–HQ–OPPT–2007–0716.
be the greater of: (1) The highest 30-minute Agency (EPA). The DCO is open from 8 a.m. to 4 p.m.,
integrated demand measured during the ACTION: Notice.
Monday through Friday, excluding legal
month up to, but not in excess of, the holidays. The telephone number for the
delivery obligation under the power sales SUMMARY: In compliance with the DCO is (202) 564–8930. Such deliveries
contract, or (2) the contract rate of delivery. Paperwork Reduction Act (PRA) (44 are only accepted during the DCO’s
Adjustments: U.S.C. 3501 et seq.), this document normal hours of operation, and special
For Drought Adder: Adjustments pursuant announces that EPA is planning to arrangements should be made for
to the Drought Adder component will be submit a request to renew an existing deliveries of boxed information.
documented in a revision to this rate approved Information Collection Instructions: Direct your comments to
schedule. Request (ICR) to the Office of docket ID number EPA–HQ–OPPT–
Billing for Unauthorized Overruns: For Management and Budget (OMB). This 2007–0716. EPA’s policy is that all
each billing period in which there is a ICR, entitled TSCA Section 4 Test Rules, comments received will be included in
contract violation involving an unauthorized Consent Orders, Test Rule Exemptions, the public docket without change and
overrun of the contractual obligation for
and Voluntary Data Submission and may be made available on-line at http://
peaking demand and/or energy, such overrun
identified by EPA ICR No. 1139.08 and www.regulations.gov, including any
shall be billed at 10 times the above rate.
OMB Control No. 2070–0033, is personal information provided, unless
[FR Doc. E7–22192 Filed 11–13–07; 8:45 am] scheduled to expire on June 30, 2008. the comment includes information
Before submitting the ICR to OMB for claimed to be Confidential Business
BILLING CODE 6450–01–P
review and approval, EPA is soliciting Information (CBI) or other information
comments on specific aspects of the whose disclosure is restricted by statute.
proposed information collection. Do not submit information that you
consider to be CBI or otherwise
DATES: Comments must be received on protected through regulations.gov or e-
or before January 14, 2008. mail. The regulations.gov website is an
ADDRESSES: Submit your comments, ‘‘anonymous access’’ system, which
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EN14NO07.009</MATH>

identified by docket identification (ID) means EPA will not know your identity
number EPA–HQ–OPPT–2007–0716, by or contact information unless you
one of the following methods: provide it in the body of your comment.
1 Firm peaking energy is normally returned. This energy is not returned. This rate is calculated in power service, Rate Schedule P–SED–F9 or its
EN14NO07.008</MATH>

rate will be assessed in the event firm peaking accordance with the schedule of rates for firm successor.

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