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<br />F. Final Decision on the Rate Adjustment. The Under Secretary will <br />promptly submit to FERC all the information concerning the rate. FERC will <br />confirm and approve, remand, or disapprove the rate submitted. <br /> <br />III. DESCRIPTION OF PROPOSAL <br /> <br />The SLCAO Integrated projects are the Colorado River Storage Project, the <br />Collbran Project, and the Rio Grande Project. Descriptions of the individual <br />projects are included in the rate brochures for the current CRSP and Collbran <br />Rates dated October 1982, and October 1985 respectively, and the brochure dated <br />May 1986 on the proposed Rio Grande rate, which are available upon request from <br />Western. <br /> <br />Integration of these projects was included in the Post 1989 Marketing <br />Plan. The benefits of integrating the project were identified as: <br /> <br />1. Increases marketable resources. <br />2. Simplifies contract development and administration. <br />3. Requires only one rate adjustment process. <br />4. Ensures timely repayment of Collbran and Rio Grande. <br /> <br />In the public meetings associated with the most recent Collbran and Rio <br />Grande projects rate adjustments, the customers requested that Western <br />integrate the rate as soon as possible to realize these benefits. In response <br />to this we are proceeding with the integrated rate. <br /> <br />Each of the projects will maintain its financial identity. A separate <br />PRS will continue to be done for each project to establish its revenue <br />requirements. CRSP will then purchase the output of the smaller projects for <br />an amount equal to this revenue requirement. Under existing laws CRSP has the <br />authority to purchase power. Purchased power costs are operating expenses of <br />CRSP. Furthermore, the CRSP act calls for the project to be operated in <br />conjunction with other projects so as to maximize the benefits of all <br />projects. Integration will fulfill this congressional mandate. <br /> <br />The proposed new SLCA-F1 Rate Schedule will replace schedules SP-F2 and <br />SP-FP2 for CRSP Firm and Peaking Power Services. Collbran and Rio Grande <br />contractors will be offered contract modifications to discontinue the purchase <br />of Collbran and Rio Grande resources in exchange for equivalent amounts of <br />Integrated resources upon the effective date of Rate Schedule SLCA-F1. <br /> <br />Western has included in its rate schedules a provision that customers are <br />normally expected to maintain a power factor of between 95 percent lagging and <br />95 percent leading. There has been no penalty for noncompliance associated <br />with this provision. The Salt Lake City Area (SLCA) also has provisions in <br />some of its transmission contracts that allow the wheeling agent to correct <br />problems associated with poor power factors on Western's customers' systems and <br />to bill Western for the improvements. In addition it is becoming increasingly <br />more expensive to provide reactive power without compensation as the demands <br />placed on the SLCA transmission system increase. In order to compensate for <br />these problems and to encourage customers to make system improvements to <br />correct power factor problems, Western proposes to include the following <br />provision in its integrated rate schedule. <br /> <br />3 <br />