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. ). .~ 1"\ _, t.,: ,I -"\ ,.., ? V'u......u'.Ju . GENERAL CHARACTERIZATION OF THE CUSTOMERS WHO PURCHASE ELECTRICAL POWER FROM THE COLORADO RIVER STORAGE PROJECT There are approximately 183 Colorado River Storage Project (CRSP) customers who purchase wholesale electricity from Western's CRSP - Management Center office in Salt Lake City. Electrical power from the CRSP generally serves the rural areas and small towns of the Rocky Mountain, Colorado Plateau, and Great Basin regions of the West. The CRSP marketing area includes parts of the states of Wyoming, Utah, Nevada, Arizona, New Mexico, Colorado and Nebraska. CRSP power customers are: 1) small and medium-sized towns that operate publicly owned electrical systems, 2) irrigation cooperatives and water conservation districts, 3) rural electrical associations or generation and transmission co-operatives who are wholesalers to these associations, 4) federal facilities such as Air Force Bases, 5) universities and other state agencies and 6) Indian tribes. Rural Electric Associations (REA) that buy power from the CRSP serve the rural areas of states. In Colorado, CRSP customers serve almost all of the geographic area of the state outside of the major metropolitan areas. Most of the electrical systems serving rural Colorado are members of Tri-state G&T. The CRSP also delivers power to some REA that are not affiliated with Tri-State. e The major cities in the states served by the CRSP (notably, Phoenix, Salt Lake City, Denver and Las Vegas) are served by private electrical companies and do not get a portion of CRSP electrical power. Some of the cities served by the CRSP are prosperous:. Provo, Utah and Colorado Springs, Colorado are examples. Others are towns that are part of thriving metropolitan areas. Bountiful, Utah and Mesa, Arizona are communities contiguous to major metropolitan areas. However, the vast majority of the towns served by the CRSP are smaller and located in rural areas. Gunnison, Oak Creek, Center and Ft. Morgan, Colorado; and Page, Arizona examples. Some Native American Tribes receive CRSP electrical power now (the Navajo Reservation in Arizona and the Ute Mountain Ute Reservation in Utah), but the CRSP will soon be serving the tribal needs of all of the tribes in the CRSP marketing area. The new allocation of power from the CRSP will serve about 65% of the residential and tribally owned business electrical needs of all of the Indian tribes in the CRSP - MC service area (there are over 50). There are 21 Federally recognized tribes in Arizona and two in Colorado. . Generally, the price these customers pay for their CRSP electrical power is less than the wholesale market price. However, these customers serve retail load in rural areas, where the cost to provide electrical service is high. Homes, farms and other electrical connections are spread out, so that a significant transmission line and electrical generation investment has to be repaid by fewer retail customers. Generally, this is why private electrical suppliers choose not to extend their service to these areas and why the Rural Electrification Administration was set up: to "electrify" the rural areas of the nation. The retail prices charged by CRSP customers to end users are usually higher than adjacent urban areas. For example, the retail price for electricity charged by the CRSP customers who serve rural New Mexico is above $O.ll/kWh compared to about $0.07/kWh in Albuquerque. Moreover, these rural areas and the tribal reservations are usually 19