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U.S. Code as of:
01/19/04
Section 839e. Rates
(a) Establishment; periodic review and revision; confirmation and
approval by Federal Energy Regulatory Commission
(1) The Administrator shall establish, and periodically review
and revise, rates for the sale and disposition of electric energy
and capacity and for the transmission of non-Federal power. Such
rates shall be established and, as appropriate, revised to recover,
in accordance with sound business principles, the costs associated
with the acquisition, conservation, and transmission of electric
power, including the amortization of the Federal investment in the
Federal Columbia River Power System (including irrigation costs
required to be repaid out of power revenues) over a reasonable
period of years and the other costs and expenses incurred by the
Administrator pursuant to this chapter and other provisions of law.
Such rates shall be established in accordance with sections 9 and
10 of the Federal Columbia River Transmission System Act (16 U.S.C.
838) [16 U.S.C. 838g and 838h], section 5 of the Flood Control Act
of 1944 [16 U.S.C. 825s], and the provisions of this chapter.
(2) Rates established under this section shall become effective
only, except in the case of interim rules as provided in subsection
(i)(6) of this section, upon confirmation and approval by the
Federal Energy Regulatory Commission upon a finding by the
Commission, that such rates -
(A) are sufficient to assure repayment of the Federal
investment in the Federal Columbia River Power System over a
reasonable number of years after first meeting the
Administrator's other costs,
(B) are based upon the Administrator's total system costs, and
(C) insofar as transmission rates are concerned, equitably
allocate the costs of the Federal transmission system between
Federal and non-Federal power utilizing such system.
(b) General application of rates to meet general requirements
(1) The Administrator shall establish a rate or rates of general
application for electric power sold to meet the general
requirements of public body, cooperative, and Federal agency
customers within the Pacific Northwest, and loads of electric
utilities under section 839c(c) of this title. Such rate or rates
shall recover the costs of that portion of the Federal base system
resources needed to supply such loads until such sales exceed the
Federal base system resources. Thereafter, such rate or rates shall
recover the cost of additional electric power as needed to supply
such loads, first from the electric power acquired by the
Administrator under section 839c(c) of this title and then from
other resources.
(2) After July 1, 1985, the projected amounts to be charged for
firm power for the combined general requirements of public body,
cooperative and Federal agency customers, exclusive of amounts
charged such customers under subsection (g) of this section for the
costs of conservation, resource and conservation credits,
experimental resources and uncontrollable events, may not exceed in
total, as determined by the Administrator, during any year after
July 1, 1985, plus the ensuing four years, an amount equal to the
power costs for general requirements of such customer if, the
Administrator assumes that -
(A) the public body and cooperative customers' general
requirements had included during such five-year period the direct
service industrial customer loads which are -
(i) served by the Administrator, and
(ii) located within or adjacent to the geographic service
boundaries of such public bodies and cooperatives;
(B) public body, cooperative, and Federal agency customers were
served, during such five-year period, with Federal base system
resources not obligated to other entities under contracts
existing as of December 5, 1980, (during the remaining term of
such contracts) excluding obligations to direct service
industrial customer loads included in subparagraph (A) of this
paragraph;
(C) no purchases or sales by the Administrator as provided in
section 839c(c) of this title were made during such five-year
period;
(D) all resources that would have been required, during such
five-year period, to meet remaining general requirements of the
public body, cooperative and Federal agency customers (other than
requirements met by the available Federal base system resources
determined under subparagraph (B) of this paragraph) were -
(i) purchased from such customers by the Administrator
pursuant to section 839d of this title, or
(ii) not committed to load pursuant to section 839c(b) of
this title,
and were the least expensive resources owned or purchased by
public bodies or cooperatives; and any additional needed
resources were obtained at the average cost of all other new
resources acquired by the Administrator; and
(E) the quantifiable monetary savings, during such five-year
period, to public body, cooperative and Federal agency customers
resulting from -
(i) reduced public body and cooperative financing costs as
applied to the total amount of resources, other than Federal
base system resources, identified under subparagraph (D) of
this paragraph, and
(ii) reserve benefits as a result of the Administrator's
actions under this chapter (!1)
were not achieved.
(3) Any amounts not charged to public body, cooperative, and
Federal agency customers by reason of paragraph (2) of this
subsection shall be recovered through supplemental rate charges for
all other power sold by the Administrator to all customers. Rates
charged public body, cooperative, or Federal agency customers
pursuant to this subsection shall not include any costs or benefits
of a net revenue surplus or deficiency occurring for the period
ending June 30, 1985, to the extent such surplus or deficiency is
caused by -
(A) a difference between actual power deliveries and power
deliveries projected for the purpose of establishing rates to
direct service industrial customers under subsection (c)(1) of
this subsection, and
(B) an overrecovery or underrecovery of the net costs incurred
by the Administrator under section 839c(c) of this title as a
result of such difference.
Any such revenue surplus or deficiency incurred shall be recovered
from, or repaid to, customers over a reasonable period of time
after July 1, 1985, through a supplemental rate charge or credit
applied proportionately for all other power sold by the
Administrator at rates established under other subsections of this
section prior to July 1, 1985.
(4) The term "general requirements" as used in this section means
the public body, cooperative or Federal agency customer's electric
power purchased from the Administrator under section 839c(b) of
this title, exclusive of any new large single load.
(c) Rates applicable to direct service industrial customers
(1) The rate or rates applicable to direct service industrial
customers shall be established -
(A) for the period prior to July 1, 1985, at a level which the
Administrator estimates will be sufficient to recover the cost of
resources the Administrator determines are required to serve such
customers' load and the net costs incurred by the Administrator
pursuant to section 839c(c) of this title, based upon the
Administrator's projected ability to make power available to such
customers pursuant to their contracts, to the extent that such
costs are not recovered through rates applicable to other
customers; and
(B) for the period beginning July 1, 1985, at a level which the
Administrator determines to be equitable in relation to the
retail rates charged by the public body and cooperative customers
to their industrial consumers in the region.
(2) The determination under paragraph (1)(B) of this subsection
shall be based upon the Administrator's applicable wholesale rates
to such public body and cooperative customers and the typical
margins included by such public body and cooperative customers in
their retail industrial rates but shall take into account -
(A) the comparative size and character of the loads served,
(B) the relative costs of electric capacity, energy,
transmission, and related delivery facilities provided and other
service provisions, and
(C) direct and indirect overhead costs.
all as related to the delivery of power to industrial customers,
except that the Administrator's rates during such period shall in
no event be less than the rates in effect for the contract year
ending on June 30, 1985.
(3) The Administrator shall adjust such rates to take into
account the value of power system reserves made available to the
Administrator through his rights to interrupt or curtail service to
such direct service industrial customers.
(d) Discount rates; special rates
(1) In order to avoid adverse impacts on retail rates of the
Administrator's customers with low system densities, the
Administrator shall, to the extent appropriate, apply discounts to
the rate or rates for such customers.
(2) In order to avoid adverse impacts of increased rates pursuant
to this chapter on any direct service industrial customer using raw
minerals indigenous to the region as its primary resource, the
Administrator, upon request of such customer showing such impacts
and after considering the effect of such request on his other
obligations under this chapter, is authorized, if the Administrator
determines that such impacts will be significant, to establish a
special rate applicable to such customer if all power sold to such
customer may be interrupted, curtailed, or withdrawn to meet firm
loads in the region. Such rate shall be established in accordance
with this section and shall include such terms and conditions as
the Administrator deems appropriate.
(e) Uniform rates; rates for sale of peaking capacity; time-of-day,
seasonal, and other rates
Nothing in this chapter prohibits the Administrator from
establishing, in rate schedules of general application, a uniform
rate or rates for sale of peaking capacity or from establishing
time-of-day, seasonal rates, or other rate forms.
(f) Basis for rates
Rates for all other firm power sold by the Administrator for use
in the Pacific Northwest shall be based upon the cost of the
portions of Federal base system resources, purchases of power under
section 839c(c) of this title and additional resources which, in
the determination of the Administrator, are applicable to such
sales.
(g) Allocation of costs and benefits
Except to the extent that the allocation of costs and benefits is
governed by provisions of law in effect on December 5, 1980, or by
other provisions of this section, the Administrator shall equitably
allocate to power rates, in accordance with generally accepted
ratemaking principles and the provisions of this chapter, all costs
and benefits not otherwise allocated under this section, including,
but not limited to, conservation, fish and wildlife measures,
uncontrollable events, reserves, the excess costs of experimental
resources acquired under section 839d of this title, the cost of
credits granted pursuant to section 839d of this title, operating
services, and the sale of or inability to sell excess electric
power.
(h) Surcharges
Notwithstanding any other provision of this section (except the
provisions of subsection (a) of this section), the Administrator
shall adjust power rates to include any surcharges arising under
section 839b(f) of this title, and shall allocate any revenues from
such charges in such manner as the Administrator determines will
help achieve the purposes of section 839b(f) of this title.
(i) Procedures
In establishing rates under this section, the Administrator shall
use the following procedures:
(1) Notice of the proposed rates shall be published in the
Federal Register with a statement of the justification and
reasons supporting such rates. Such notice shall include a date
for a hearing in accordance with paragraph (2) of this
subsection.
(2) One or more hearings shall be conducted as expeditiously as
practicable by a hearing officer to develop a full and complete
record and to receive public comment in the form of written and
oral presentation of views, data questions, and argument related
to such proposed rates. In any such hearing -
(A) any person shall be provided an adequate opportunity by
the hearing officer to offer refutation or rebuttal of any
material submitted by any other person or the Administrator,
and
(B) the hearing officer, in his discretion, shall allow a
reasonable opportunity for cross examination, which, as
determined by the hearing officer, is not dilatory, in order to
development information and material relevant to any such
proposed rate.
(3) In addition to the opportunity to submit oral and written
material at the hearings, any written views, data, questions, and
arguments submitted by persons prior to, or before the close of,
hearings shall be made a part of the administrative record.
(4) After such a hearing, the Administrator may propose revised
rates, publish such proposed rates in the Federal Register, and
conduct additional hearings in accordance with this subsection.
(5) The Administrator shall make a final decision establishing
a rate or rates based on the record which shall include the
hearing transcript, together with exhibits, and such other
materials and information as may have been submitted to, or
developed by, the Administrator. The decision shall include a
full and complete justification of the final rates pursuant to
this section.
(6) The final decision of the Administrator shall become
effective on confirmation and approval of such rates by the
Federal Energy Regulatory Commission pursuant to subsection
(a)(2) of this section. The Commission shall have the authority,
in accordance with such procedures, if any, as the Commission
shall promptly establish and make effective within one year after
December 5, 1980, to approve the final rate submitted by the
Administrator on an interim basis, pending the Commission's final
decision in accordance with such subsection. Pending the
establishment of such procedures by the Commission, if such
procedures are required, the Secretary is authorized to approve
such interim rates during such one-year period in accordance with
the applicable procedures followed by the Secretary prior to
December 5, 1980. Such interim rates, at the discretion of the
Secretary, shall continue in effect until July 1, 1982.
(j) Cost figures to be indicated on rate schedules and power
billings
All rate schedules adopted, and all power billings rendered, by
the Administrator pursuant to this section shall indicate -
(1) the approximate cost contribution of different resource
categories to the Administrator's rates for the sale of energy
and capacity, and
(2) the cost of resources acquired to meet load growth within
the region and the relation of such cost to the average cost of
resources available to the Administrator.
(k) Statutory basis for procedures used in establishing rates or
rate schedules
Notwithstanding any other provision of this chapter, all rates or
rate schedules for the sale of nonfirm electric power within the
United States, but outside the region, shall be established after
December 5, 1980, by the Administrator in accordance with the
procedures of subsection (i) of this section (other than the first
sentence of paragraph (6) thereof) and in accordance with the
Bonneville Project Act [16 U.S.C. 832 et seq.], the Flood Control
Act of 1944, and the Federal Columbia River Transmission System Act
[16 U.S.C. 838 et seq.]. Notwithstanding section 201(f) of the
Federal Power Act [16 U.S.C. 824(f)], such rates or rate schedules
shall become effective after review by the Federal Energy
Regulatory Commission for conformance with the requirements of such
Acts and after approval thereof by the Commission. Such review
shall be based on the record of proceedings established under
subsection (i) of this section. The parties to such proceedings
under subsection (i) of this section shall be afforded an
opportunity by the Commission for an additional hearing in
accordance with the procedures established for ratemaking by the
Commission pursuant to the Federal Power Act [16 U.S.C. 791a et
seq.].
(l) Rates for sales outside United States; negotiations
In order to further the purposes of this chapter and to protect
the consumers of the region, the Administrator may negotiate, or
establish, rates for electric power sold by the Administrator to
any entity not located in the United States which shall be
equitable in relation to rates for all electric power which is, or
may be, purchased by the Administrator or the Administrator's
customers from entities outside the United States. In establishing
rates other than by negotiation, the provisions of subsection (i)
of this section shall apply. In the case of any negotiation with an
entity not located in the United States, the Administrator shall
provide public notice of any proposal to negotiate such rates. Such
negotiated rates shall be not less than the rates established under
this chapter for nonfirm power sold within the United States but
outside the region. The Administrator shall also afford notice of
any rates negotiated pursuant to this subsection.
(m) Impact aid payments; formula
(1) Beginning the first fiscal year after the plan and program
required by section 839b(d) and (h) of this title are finally
adopted, the Administrator may, subject to the provisions of this
section, make annual impact aid payments to the appropriate local
governments within the region with respect to major transmission
facilities of the Administrator, as defined in section 3(c) of the
Federal Columbia River Transmission Act [16 U.S.C. 838a(c)] -
(A) which are located within the jurisdictional boundaries of
such governments,
(B) which are determined by the Administrator to have a
substantial impact on such governments, and
(C) where the construction of such facilities, or any
modification thereof, is completed after December 5, 1980, and,
in the case of a modification of an existing facility, such
modification substantially increases the capacity of such
existing transmission facility.
(2) Payments made under this subsection for any fiscal year shall
be determined by the Administrator pursuant to a regionwide,
uniform formula to be established by rule in accordance with the
procedures set forth in subsection (i) of this section. Such rule
shall become effective on its approval, after considering its
effect on rates established pursuant to this section, by the
Federal Energy Regulatory Commission. In developing such formula,
the Administrator shall identify, and take into account, the local
governmental services provided to the Administrator concerning such
facilities and the associated costs to such governments as the
result of such facilities.
(3) Payments made pursuant to this subsection shall be made
solely from the fund established by section 11 of the Federal
Columbia River Transmission System Act [16 U.S.C. 838i]. The
provisions of section 13 of such Act [16 U.S.C. 838k], and any
appropriations provided to the Administrator under any law, shall
not be available for such payments. The authorization of payments
under this subsection shall not be construed as an obligation of
the United States.
(4) No payment may be made under this subsection with respect to
any land or interests in land owned by the United States within the
region and administered by any Federal agency (other than the
Administrator), without regard to how the United States obtained
ownership thereof, including lands or interests therein acquired or
withdrawn by a Federal agency for purposes of such agency and
subsequently made available to the Administrator for such
facilities.
(n) Limiting the inclusion of costs of protection of, mitigation of
damage to, and enhancement of fish and wildlife, within rates
charged by the Bonneville Power Administration, to the rate
period in which the costs are incurred
Notwithstanding any other provision of this section, rates
established by the Administrator, under this section shall recover
costs for protection, mitigation and enhancement of fish and
wildlife, whether under this chapter or any other Act, not to
exceed such amounts the Administrator forecasts will be expended
during the fiscal year 2002-2006 rate period, while preserving the
Administrator's ability to establish appropriate reserves and
maintain a high Treasury payment probability for the subsequent
rate period.
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