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<br /> <br />'.,'Section 3 <br /> <br />Policy Issues and Assumptions <br /> <br />Through the SRP Exchange Agreement, SRP delivers' power from its thermal generation in <br />Colorado and New Mexico to Western for use in serving Western's customers north and <br />east ofGCD in the SLCNIP territory. Western then delivers a like amount of power frotn <br />GCD to SRP in the Phoenix area. at Pinnacle Peak. Under the SRP Exchange Agreement, <br />Western also provides transmission service to SRP for SRP's thermal generation that <br />cannot be exchanged. <br /> <br />The SRP Exchange Agreement allowed both parties to reduce costs by avoiding the need <br />to construct redundant transmission facilities. However, because changes in GCD <br />operations may reduce the amount of hydroelectric gtl1$l1'ation available to exchange with <br />SRP's thermal generation, and because the transmission paths from northwest Colorado <br />and the Four Corners area (where SRP's generation is located) to GCD are constrained, <br />delivery of the full amount of power to SRP may not be possible at certain times along this <br />path. SRP and Western recently signed an amendment to the SRP Exchange Agreement to <br />better describe operation. of the exchange given these changes. Information on the <br />modeling of this important agreement as a part of this ~tudy is provided in Section 5. <br /> <br />3.3.1.4 NTUA EXCHANGE AGREEMENT <br /> <br />Western also has an exchange agreement with the Navajo Tribal Utility Authority (NTUA). <br />Under this agreement, Western delivers approximately 22 MW of Glen Canyon generation <br />to NTUA at the Glen Canyon substation in exchan!le for 22 MW of NTUA generation <br />delivered to Western at Shiprock substation in northwest New Mexico. This agreement <br />also includes a wheeling component, whereby ~estern wheels 22 MW of NTUA <br />generation to their loads ~t Kayenta and Long House Valley substations. <br /> <br />3.3.2 HOOVER PROJECT INTEGRATION <br /> <br />The GCP Act states that the Secretary of Energy shall "include an investigation of the <br />feasibility of adjusting operations at Hoover Dam to replace all or part of such lost <br />generation" at GCD. While a new investigation ofin*gration was not conducted as a part <br />of the Methods Report, prior research on integration 'of power from the Boulder Canyon <br />(Hoover) Project with SLCNIP power was collected and reviewed. <br /> <br />3.3.2.1 BACKGROUND <br /> <br />Hoover Project power is marketed by Western under the Hoover Powerplant Act of 1984, <br />and the 1984 Conformed General Consolidated Power Marketing Criteria or Regulations <br />for Boulder City Area projects.3 The Hoover Powerplant Act of 1984 provides for the <br />marketing of Hoover power from June 1, 1987 through September 3, 2017. It provides the <br />method for allocating Hoover capacity to be made available under renewal contracts to the <br />original contractors, and Hoover capacity resulting 'from the Hoover Uprating Project <br />(collectively called "Contingent Capacity"), along with associated finn energy, for the <br /> <br />3-6 Western Area Power Administration <br /> <br />March 1998 <br />