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<br />01238 <br /> <br />Western's response stated: <br /> <br />"All authorized participating projects are contained within every PRS... <br />The August 1983 agreement formalized the principle that participating <br />projects that are unlikely to be built will not influence the rate charged <br />to power customers. This is done by rescheduling the repayment due dates <br />for the uncertain participating projects beyond the end of the calculation <br />peri od in the PRS." . <br /> <br />The water depletion schedule contained in the 1988 Definite Plan Report (DPR) <br />assumes that water available for power production will decrease at the <br />scheduled inservice date of each authorized participating project regardless <br />of how uncertain construction of some of the projects may be. The Rate Order <br />PRS for the rate effective October 1. 1990 omitted the water depletions <br />associated with those participating projects whose construction is uncertain <br />and whose repayment is scheduled beyond the rate setting period of the PRS. <br />This was done so that the costs of the projects that are not presently planned <br />to be built would not affect the rate. <br /> <br />A different depletion schedule (Reclamation's 1991 Planning Document) was used <br />in Reclamation's 1993 CRSM hydrology study than the depletion schedule in the <br />1988 DPR. These schedules are significantly different. <br /> <br />The last "Official" depletion schedule prepared was the 1988 DPR. <br /> <br />Sensitivities <br /> <br />. The states in the Upper Colorado River Basin. although not opposing the <br />approach used by Western in the 1990 rate process. are still concerned <br />that their rights to the water of the Colorado River not be violated. <br /> <br />. The power customers are concerned that use of the full depletion schedule <br />in the early years before the actual construction of projects by the <br />states burdens them with an unjustifiably high firm power rate. <br /> <br />Alternatives <br /> <br />1. Use the new 1991 Planning Document which is the latest information <br />available regarding planned depletions. even though it is not official <br />document for planned depletions. <br /> <br />2. Use the last official DPR without modification of the depletion schedule. <br /> <br />3. Use the last official DPR as modified in the 1990 rate process <br /> <br />Discussion <br /> <br />One of the four requirements stated in the Western/Reclamation Agreement, <br />dated August 26. 1983, which must be met before costs of a participating. <br />project will be allowed to affect the firm power rate. is that a definite plan <br />report must be prepared. Western's Administrator took the position in the <br />1990 rate adjustment process that the last official DPR would be used until a <br />new one was prepared and then appropriate adjustments would be made. He also <br />