WSP11241 - Laserfiche WebLink

Home Browse Search

..... J 01370 , Apportionment The apportionment obligation is an important element of the CRSP power rate. Apportionment means that if one of the four states involved (Colorado, New Mexico, Utah, and Wyoming) has a requirement for irrigation assistance, all states must be apportioned or allotted a certain amount of funds (Chart III). For example since Utah's apportionment percentage is 21.5 percent, when it requires assistance, $4.65 must be made available to all states for each $1.00 that Utah requires. Several projects in all four states are involved with apportionment as can be seen in this rather "busy. chart (Chart IV). However because of the amount and timing of its requirements, the state of Utah triggers apportionment in every year of the study except for one year when \:l,1V\ ~. .",ln9' s San Juan Chama block I drives the apportionment. This is because the apportionment that is triggered by Utah's needs more than covers the other states' needs when they occur. Chart IV shows that in the current power repayment study, about $1.3 billion is required for irrigation assistance but about that much more or another $1.3 billion is required for apportionment to states according to the CRSP Act of 1956. Effects of Apportionment The power repayment study is like a snapshot in time. In order to calculate a rate, projections must be made about future conditions with the CRSP. Estimates of generation must be made. Estimates of revenue requirements must also be made. Both estimates impact the rate because revenue requirements must be divided by generation in order to arrive at a rate per unit of power sold. Assumptions about the amount and timing of repayment obligations can effect the rate. For example, if the study is run without the apportionment obligation, the rate decreases by about 1.11 mills per kWh. This composite rate is determined by taking the associated revenue requirements and dividing by the corresponding sales of energy (kWh) during the rate setting period. When an adjustment like the deletion of apportionment occurs, other revenue requirements such as interest shift somewhat as can be seen in Chart V and VI. The repayment of plant also shifts because even though the overall rate is less, near term capital repayment requirements remain unchanged. .' SUllllllary In summary, this discussion gives a general overview of how CRSP rates are set during the ratesetting period, what costs are involved, and how the pinchpoint determines the rate. We also talked about one of the elements of the rate or apportionment and how this effects the rate. ..- -- ,.... -.~.,..-:---.- ---~- ."-- - _.' . -,- --__._r.___,_:-- ..';"-;-._...........,._.. ..._ ,.