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Energy Planning and Management Program; Integrated Resource Planning Approval Criteria
Note: EPA no longer updates this information, but it may be useful as a reference or resource.
[Federal Register: March 30, 2000 (Volume 65, Number 62)]
[Rules and Regulations]
[Page 16789-16802]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr30mr00-3]
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DEPARTMENT OF ENERGY
Western Area Power Administration
10 CFR Part 905
RIN 1901-AA84
Energy Planning and Management Program; Integrated Resource
Planning Approval Criteria
AGENCY: Western Area Power Administration, DOE.
ACTION: Final rule.
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SUMMARY: The Western Area Power Administration (Western) is publishing
this final rule to adopt revisions to current regulations that require
customers to prepare integrated resource plans. These amendments allow
customers more alternatives in meeting the integrated resource planning
requirements, thereby enhancing customer competitiveness through
increased flexibility and reduced burdens in complying with this rule.
EFFECTIVE DATE: These regulations will become effective May 1, 2000.
FOR FURTHER INFORMATION CONTACT: Mr. Simmons Buntin, Western Area Power
Administration, P.O. Box 281213, Lakewood, CO 80228-8213. Mr. Buntin
can also be reached by phone at (720) 962-7419, fax at (720) 962-7427,
and electronic mail to buntin@wapa.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction and Background
II. Discussion of Comments
III. Procedural Requirements
A. Executive Order 12866
B. Review Under the Regulatory Flexibility Act
C. Review Under the Paperwork Reduction Act
D. Review Under the National Environmental Policy Act
E. Review Under Executive Order 13132
F. Review Under the Unfunded Mandates Reform Act of 1995
G. Review Under Executive Order 12988
H. Treasury and General Government Appropriations Act, 1999
I. Review Under Executive Order 13084
J. Review Under Small Business Regulatory Enforcement Fairness
Act of 1996
I. Introduction and Background
Section 114 of the Energy Policy Act of 1992 (EPAct), Public Law
102-486, requires integrated resource planning (IRP) by Western's
customers. Western implemented EPAct through the Energy Planning and
Management Program (EPAMP) in October 1995. EPAMP was published in the
Code of Federal Regulations at 10 CFR part 905.
Western's Administrator is required by EPAct to initiate a public
process to review Western's IRP regulations within 1 year after January
1, 1999. The Administrator is authorized at that time to revise
Western's criteria for approving integrated resource plans ``to reflect
changes, if any, in technology, needs, or other developments.''
Both the wholesale and retail aspects of the electric utility
industry are changing, and change is expected to continue. The 15
States within which Western markets power have taken very different
approaches to deregulation with diverse schedules for implementing any
changes to the status
[[Page 16790]]
quo. Additionally, the timing and scope of any Federal restructuring
legislation is uncertain. Given the increasingly competitive and
deregulated electricity marketplace, Western's IRP regulations, which
were adopted under the traditional utility planning framework, have
been reviewed through a formal public process and consequently revised.
Western is adopting an approach that features customer choice and
flexibility, and reflects the transition of the electric utility
industry. Customers can choose to continue preparing IRPs, or can adopt
approaches that are emerging in lieu of IRP requirements. These new
approaches are (1) complying with a defined level of investment in
demand-side management (DSM) and/or renewable energy, including a
public benefits program, or (2) complying with mandated energy
efficiency and/or renewable energy activities and related reporting
requirements.
Only subparts A and B of the existing regulations are being
revised.
Western published the notice of proposed rulemaking and public
forum in the Federal Register at 64 FR 62604 on November 17, 1999. A
formal public information and comment forum was held in Denver,
Colorado, on November 30, 1999. Nine customer representatives attended,
and formal transcripts were made available through Western's Corporate
Services and Regional offices. The formal public comment period closed
on December 30, 1999. Western received comments from 29 customers and
other stakeholders. All comments were extensively reviewed and, where
appropriate, incorporated into the Final Rule. The Discussion of
Comments provides Western's response to all comments. Comments and
related responses were consolidated where possible.
II. Discussion of Comments
General comments and discussion precede the comments relating to
specific sections. Specific comments are grouped under the appropriate
section heading and followed by Western's responses.
1. General
A. Comments
One commenter suggested that Western should continue to update the
IRP process as the industry continues to restructure. Two commenters
said that the proposed changes to the IRP rule seem to minimize
requirements for small utilities while maintaining inflexible
requirements for larger utilities. One commenter noted that Western
should capitalize words such as ``Customer'' and ``Integrated Resource
Planning'' to match contractual language.
B. Response
Western will continue to evaluate the changing utility industry and
the impacts of the changes on IRP regulations, and initiate a public
process to review the regulations at appropriate intervals. As Section
114 EPAct and Sec. 905.24 of the final rule state, the regulations may
be changed to reflect changes in technology, needs, or other
developments.
It is not Western's intent to change the rule solely to benefit
small customers. The rule has been revised to further accommodate
multi-state entities, especially in the minimum investment report
alternative (Sec. 905.16), and member-based associations (MBA) and IRP
cooperatives. Western believes that large customers have considerable
opportunities to perform streamlined IRP and alternative reporting
based on the revised rule, especially in light of changes in the
utility industry that impact large customers.
Western agrees that there is a strong relationship between
contractual language and language incorporated into the IRP rule.
However, the rule has been revised to comply with the President's
initiative to use plain language in government writing. Capital letters
for contractual terms are not used in this rule because their use does
not meet plain language guidelines.
2. Sec. 905.1 What Are the Purposes of the Energy Planning and
Management Program?
A. Comments
One commenter suggested that the phrase ``and to extend the long-
term firm power resource commitments'' be deleted from the first
sentence. Another commenter said that Western should refer specifically
to part 905 in the first paragraph.
B. Response
Section 905.1 describes the purposes of EPAMP, which includes both
the IRP regulations in subpart B of part 905 (which is revised in this
final rule) and the Power Marketing Initiative in subpart C of part 905
(which is not revised). It is inappropriate, therefore, to remove the
phrase ``and to extend the long-term firm power resource commitments''
because the phrase describes the purpose of the Power Marketing
Initiative.
The title of part 905, ``Energy Planning and Management Program,''
is now included in both the title of Sec. 905.1 and in the text. This
change more clearly identifies the content of the paragraph while
meeting plain language guidelines. Western believes it is unnecessary
to otherwise refer specifically to part 905 within the subpart.
3. Sec. 905.2 What Are the Key Definitions of This Part?
A. Comment
One commenter suggested that the phrase ``at the lowest system
cost'' should still be included in the definition of ``integrated
resource planning.''
B. Response
The definition of ``integrated resource planning'' in Sec. 905.2
was shortened to ensure a more concise and easily understood
definition, while having the same intended meaning as before. Western
removed ``at the lowest system cost'' because its meaning was
interpreted as a mandate to select the energy resources that had the
lowest dollar price. As a result, it actually became a barrier to
pursuing DSM and renewable energy activities, which are usually more
expensive than purchasing non-renewable resources. Although this was
not the intent of EPAct, Western has removed this and other similar
language for clarity because Western is interested in fostering DSM and
renewable energy. This change in no way invalidates an IRP that selects
resources based on least cost; Western is simply not mandating this
approach.
The sentence following the original definition, which was not part
of the definition but an explanation of the process of preparing and
IRP, was moved to Sec. 905.11, where the process of preparing an IRP is
more appropriately discussed.
4. Sec. 905.11 What Must an IRP Include?
A. Comments
Some commenters said that the statutory criteria set forth in EPAct
should be adhered to without modification, while many commenters
applauded Western's willingness to consider changes to the criteria
that accommodate changes in the electric utility industry. Some
commenters noted that, despite streamlining, the IRP criteria are still
too comprehensive and too restrictive given changes in the utility
industry. Two commenters suggested Western accept more summary
descriptions, decreasing its reliance on strict numerical data.
One comment suggested the phrase ``for new energy resources'' be
added to
[[Page 16791]]
the end of the first sentence in Sec. 905.11(a). One commenter noted
that, in Sec. 905.11(a), ``must'' should be replaced with ``should.''
One comment suggested Western should not drop the ``least cost''
criteria. One comment suggested that Western's proposal to allow
customers to determine their own action planning horizons is
inconsistent with EPAct.
Many comments requested Western add the modifier ``to the extent
practicable'' to the first sentence of Sec. 905.11(b)(3), as it is in
the existing regulations. One comment requested Western add the
modifier ``ample opportunity'' to the first sentence of
Sec. 905.11(b)(4), as it is in the existing regulations. Many
commenters said that if additional load forecasting information is
requested in the IRP review process, Western should accept any other
required report containing this type of information that is submitted
to the Department of Energy (DOE) or the Federal Energy Regulatory
Commission (FERC). One commenter noted Western should require only the
information necessary to define load characteristics, and not the
specific nature of the use of that power, relating to the load
forecasting criteria (Sec. 905.11(b)(5)).
B. Response
Section 114 of EPAct gives Western the authority to review its IRP
program and to revise the IRP compliance criteria set forth in EPAct
(42 U.S.C. 7276b(b)), which have been implemented through EPAMP at 10
CFR part 905, to reflect changes in technology, needs, or other
development. Because Western's IRP regulations were developed under the
traditional utility planning framework, which no longer applies to many
customers due to wholesale and retail electric competition, Western
believes it is essential to review and subsequently revise the
criteria.
Additionally, Western's criteria revisions reduce reporting and
paperwork burdens for customers and Western. Western streamlined the
IRP criteria in Sec. 905.11(b) to make them less comprehensive and
restrictive, especially by changing the regulations to state that
Western will accept summary information from customers rather than full
data. While customers must include the criteria detailed in
Sec. 905.11(b), many of the items within in these criteria--for
example, the list of what the options evaluated should relate to in
Sec. 905.11(b)(1)--are general guidelines and not strict requirements.
Western's intent is not to dictate resource choices or specific
mechanisms for resource planning, but rather to provide a general
outline for IRP that meets the spirit and intent of EPAct. Reducing the
criteria further would not meet the spirit or intent of EPAct even in
light of the changing nature of the electric utility industry.
Accepting even more summary information would not allow Western to
adequately evaluate IRPs and annual reports and amendments.
It is not appropriate to add the phrase ``for new energy
resources'' to the end of the first sentence in Sec. 905.11(a) because
EPAct makes no such limitation. IRPs may, at the customer's discretion,
incorporate all energy resources. Limiting an IRP to only new energy
resources may be contrary to sound resource planning.
``Must'' has replaced ``shall'' in Sec. 905.11(a) to meet plain
language guidelines. The comment that ``should'' was used in the
original language in Sec. 905.11(a) is incorrect. The original
language, which was taken from the sentence following the definition of
``integrated resource planning'' in EPAct and Sec. 905.2, used the verb
``shall.'' Because EPAct Section 201(2) mandates these components of
IRP, Western will continue to use ``must'' rather than ``should.''
Western has dropped the ``designation of least-cost options''
criteria, previously located at Sec. 905.11(b)(3), deleting some
language that is no longer relevant and moving the remaining relevant
language to the ``identification of resource options'' criteria
(Sec. 905.11(b)(1)). Because least cost is no longer a deciding factor
for many customers-- and is often perceived as a barrier for some
customers in further pursuit of DSM and renewable energy--Western
believes it may impede effectively implementing IRP.
Because Section 114 of EPAct gives Western authority to revise its
IRP criteria, allowing customers to determine their own action planning
horizons in Sec. 905.11(b)(2) is not inconsistent with EPAct. Moreover,
determining action planning horizons is essential for customers facing
wholesale competition. Many customers must make resource decisions on
real-time bases that simply could not be planned for in advance and
therefore included in either short-term or long-term action plans.
Action planning flexibility is essential in the changing electric
utility industry.
Western has returned the modifier ``to the extent practicable'' to
Sec. 905.11(b)(3), environmental effects, to reflect the language in
EPAct. Western has returned the modifier ``ample opportunity'' to
Sec. 905.11(b)(4), public participation. It was removed to accommodate
plain language, but keeping it in the rule allows customers to continue
to meet the public involvement criteria in a manner consistent with the
language of EPAct.
Western will accept information required by DOE, FERC, or another
entity so long as it contains adequate load forecasting information.
Western's intent is not to require duplicative efforts, but to ensure
Western receives the specific customer information needed to fully
evaluate the IRP. Western only requires the information necessary to
define load characteristics, and will request information about the
specific nature of the use of that power only in those rare cases where
it is necessary to adequately evaluate the IRP.
5. Sec. 905.12 How Must IRPs Be Submitted?
A. Comment
One commenter requested that the phrase ``Such IRP or IRPs shall
constitute the MBA's IRP where the MBA subcontracts or acts as an agent
but does not assume power supply responsibility'' be returned to
Sec. 905.12(b)(2), as it is in the existing regulations.
B. Response
Western agrees that under Sec. 905.12(b)(2), the IRP may constitute
the MBA's IRP where the MBA subcontracts or acts as an agent but does
not assume power supply responsibility. The definition of MBA in
Sec. 905.2 meets the intent of the phrase, so in light of plain
language guidelines and the need for clarity in the regulations,
Western does not feel it is necessary to adopt this comment.
6. Sec. 905.13 When Must IRPs Be Submitted?
A. Comment
One comment suggested that an existing IRP cooperative should be
able to file the new report alternatives on behalf of its participants.
B. Response
Western agrees that an IRP cooperative should be able to file a
minimum investment report on behalf of its participants, just as a
consultant can now prepare and submit an IRP or small customer plan on
behalf of a utility or end-use customer. Language has been added to
Sec. 905.12(b)(3) to this effect.
[[Page 16792]]
7. Sec. 905.15 What Are the Requirements for the Small Customer Plan
Alternative?
A. Comments
One commenter said that Western cannot extend the definition of
small customer to include members of joint-action agencies (JAA) and
generation and transmission (G&T) cooperatives with power supply
responsibility because EPAct specifically excludes these entities,
while some commenters noted that the ability of individual members of
JAAs and G&T cooperatives to prepare small customer plans would greatly
simplify the task of meeting Western's IRP requirements for a
substantial number of customers.
One commenter suggested that ``customer'' should be added after
``utility'' in Sec. 905.15(e)(1)(i) to mirror the language used in the
definition of small customer (Sec. 905.2).
B. Response
After further review, Western determined that the best approach is
not to include members of JAAs and G&T cooperatives with power supply
responsibility within the small customer provision. However, Western
does have the ability to change the criteria for determining IRP
compliance, as set forth in Section 114 of EPAct. Western also noted
that JAA and G&T cooperative members with less than 25 gigawatthours
(GWh) use and sales may have limited managerial, economic, and resource
capability, similar to other small customers. Their resource scenarios
are often similar, and their ability to conduct IRP just as limited.
Accordingly, Western has created new, reduced IRP compliance criteria
for JAA and G&T cooperative customers not qualifying for ``small
customer'' status and yet have less than 25 GWh use and sales and have
limited managerial, economic, and resource capability, at
Sec. 905.11(c). These criteria mirror the criteria set forth in the
small customer provision at Sec. 905.15, and are consistent with the
flexibilities provided to Western under EPAct. These certain customers
must conduct IRP, but under less stringent criteria to reflect their
limited capabilities. Unlike the small customer provision, qualifying
customers do not need to notify Western in advance if complying through
the use of these reduced IRP compliance criteria. Western will use
qualifying customers' annual IRP progress reports to verify ongoing
eligibility.
``Customer'' has been added after ``utility'' in
Sec. 905.15(e)(1)(i) as suggested, to match the definition in
Sec. 905.2.
8. Sec. 905.16 and Sec. 905.17 General Comments on Minimum Investment
Report, Public Benefits Report, and Energy Efficiency/Renewable Energy
(EE/RE) Report Alternatives
A. Comments
Western received a number of general comments about the proposed
new alternatives--minimum investment report, public benefits report,
and EE/RE report. One commenter noted that the alternatives appear to
be essentially the same, so they should be combined.
A number of comments suggested that eligibility for State, Tribal,
and Federal Government mandates on these alternatives is too narrow,
and that the alternatives should also be open to standard-setting by
local governing boards such as city councils and utility boards.
Another commenter said alternatives should include mandates set by
either State law or State policy. One comment suggested Western should
establish some of its own mandates for minimum investments and EE/RE
reports. One commenter noted the proposed alternatives should only be
applicable in States in which retail competition exists.
One commenter requested that in instances where the State, Tribal,
or Federal Government has implemented a program that meets Western's
alternatives, Western defer its review authority and accept every
report on or stemming from these programs.
Some comments called for additional clarification as to how State,
Tribal, or Federal mandates are to be applied for multi-state entities,
such as MBAs and IRP cooperatives.
Some commenters noted that Western should add provisions to the
alternatives to allow for joint reporting by a group of customers.
One commenter noted that Western was not requiring customers to
submit revisions to approved alternative reports every 5 years, as
provided for IRPs and small customer plans.
Several municipalities and rural electric cooperatives asked if
preparing energy efficiency plans as required by their State's public
utility commission could satisfy any of Western's alternative reporting
requirements.
B. Response
Western believes that the EE/RE report alternative is clearly
different from the minimum investment and public benefits report
alternatives, in large part because it applies only to end-use
customers. Western agrees that the minimum investment report and public
benefits report are essentially the same. Western eliminated the
separate public benefits report alternative and combined the relevant
public benefits language with the minimum investment report
alternative. Language noting that public benefits charges are included
within the definition of minimum investment report has been added in
Sec. 905.2, as well.
Western does not agree that limiting the alternatives to mandates
set only by State, Tribal, and Federal Governments is too narrow.
Likewise Western believes it is inappropriate for it to set such
mandates. Because of the broad and open nature of lawmaking and
regulatory processes at the State and Federal levels in comparison to
the processes of Western's customers, Western is reluctant to accept
any lesser mandates. Additionally, as a Federal agency, Western defers
to Tribes' sovereign authority to set their own minimum investment or
EE/RE reporting requirements.
While Western always reviews submissions--whether IRP or
alternatives--for reasonableness, Western is more comfortable with
broad decision making (State or Federal) that customers must follow by
law, and prefers to rest on the minimum investment and EE/RE
requirements set at higher levels of government. Customers not under
the jurisdiction of State, Tribal, or Federal Governments with minimum
investment or EE/RE reporting requirements must meet the IRP or small
customer provision, as applicable.
Similarly, Western does not agree that the energy efficiency and
renewable energy mandates for all alternatives should be allowed by
State policy. State law or State regulations developed by the public
utilities commission or its equivalent must be the standard. Policy
adopted by State end-use customers does not meet the intent of the
alternative reporting requirements. Otherwise, State end-use customers
are setting their own minimum investment or EE/RE requirements, which
is contradictory to the intent of these regulations.
Western does not agree that the proposed alternatives should only
be applicable in States where retail competition exists. The passage of
EPAct created wholesale competition, followed by FERC's mandate for
open access to transmission systems. These events have had a far larger
impact on utility resource planning and use than retail competition.
Wholesale competition drives resource decisions, especially real-time
and short-term resource acquisition.
Western will not defer its authority in instances where the State,
Tribal, or
[[Page 16793]]
Federal Government has implemented a program that meets the
alternatives, because this approach would not satisfy our obligations.
EPAct mandates that Western collect, evaluate, and report on data to
meet EPAct's IRP requirements. Western must report on the data annually
to Congress, and, to meet this requirement, must receive adequate data
from all customers. While Western will accept reports that fully meet
the criteria contained in the alternative provisions (Sec. 905.16 and
Sec. 905.17, respectively), a request to submit the reports must be
submitted and approved prior to submitting the report.
Western agrees that additional clarification is needed regarding
application of the new alternatives to multi-state entities.
Accordingly, Western has developed a new paragraph (c) in the minimum
investment report alternative at Sec. 905.16. A multi-state customer
choosing to comply with the minimum investment alternative must apply
the highest minimum investment level mandated by any State or Tribal
jurisdiction within its service territory to all customers in States or
Tribal jurisdictions without mandated minimum investments. In instances
where more than one State or Tribal jurisdiction has a minimum
investment requirement, those should be applied to customers within
that State or Tribal jurisdiction. To qualify for the minimum
investment alternative, however, the highest investment level must
still be applied to customers in States or Tribal jurisdictions without
requirements. Alternatively, multi-state entities can complete the
streamlined IRP outlined in Sec. 905.11. Western is willing to work
with multi-state entities to ensure the most effective, and least
burdensome, compliance mechanism.
Western will allow minimum investment reports to be submitted by
MBAs on behalf of the MBA or one or more of its members, and by IRP
cooperatives on behalf of its participants, as detailed in
Sec. 905.16(a). This is also demonstrated by applying the definitions
of customers and MBAs in Sec. 905.2, to statements in Sec. 905.12(b)
and (c).
Western agrees it should require customers to submit revisions to
their approved alternative reports every 5 years, as provided for IRPs
and small customer plans, and has revised the regulations accordingly.
Municipalities and rural electric cooperatives subject to State
regulatory jurisdiction can potentially satisfy the requirements of the
minimum investment report alternative based on energy efficiency plans
prepared to comply with requirements established by their State's
public utility commission. They must submit requests to prepare the
minimum investment reports and, if Western approves the requests, must
submit reports, meeting the requirements of these regulations,
particularly Sec. 905.16.
9. Sec. 905.16 What Are the Requirements for the Minimum Investment
Report?
A. Comment
One commenter requested that customers be allowed to continue
meeting the levels of minimum investment established by State, Tribal,
or Federal mandate once the mandate has expired or is otherwise no
longer in effect. One comment suggested the minimum investment
requirement should include the full array of DSM, including both energy
efficiency and load management, instead of just energy efficiency.
B. Response
Because Western is allowing the State, Tribal, or Federal mandate
to set the minimum level of investment and related parameters, subject
to Western's review for reasonableness, Western cannot allow customers
to continue applying the minimum investment once the mandate no longer
exists. If the State, Tribal, or Federal Government chooses to
terminate the mandate, Western sees no compelling reason to continue to
recognize an expired standard.
Western agrees that it should not restrict the permissible demand-
side minimum investment activities to just those that can be
categorized as energy efficiency, so it has expanded the list of
acceptable categories in Sec. 905.16(b)(1) and elsewhere by changing
the term ``energy efficiency'' to ``DSM,'' which includes energy
efficiency, load management, and other demand-side measures.
10. Sec. 905.17 What Are the Requirements for the Energy Efficiency
and/or Renewable Energy (EE/RE) Report Alternative?
A. Comments
Many comments suggested that Schedule 5 of Energy Information
Administration (EIA) Report No. 861, EIA Report No. 412, and Federal
Energy Regulatory Commission (FERC) Form No. 1, be acceptable as
approved reports under the EE/RE report alternative. One commenter said
that the EE/RE report is not a substitute for IRP, and should be
withdrawn. One commenter noted that reports submitted by Federal
agencies in accordance with Section 303 of Executive Order (EO) 13123
should be considered as meeting the EE/RE reporting requirement, while
another comment suggested any reporting requirement should be waived
for Federal customers under the mandate of EO 13123 because compliance
with EO 13123 sufficiently satisfies the intended goals of EPAct.
B. Response
The intent underlying the EE/RE report was not clearly understood
by customers and stakeholders, so additional clarifying language has
been added to Sec. 905.17. The language emphasizes that the EE/RE
report applies only to end-use customers, and that it is based on a
mandate by a State, Tribal, or Federal Government to implement energy
efficiency and/or renewable energy activities within a specified
timeframe, for which there is also an associated reporting requirement.
Therefore, EIA Reports No. 861 and 412, and FERC Form No. 1 cannot be
accepted because they have no mandated energy efficiency or renewable
energy requirements. Western will, however, accept any of these reports
as all or part of an annual IRP progress report so long as it meets by
itself, or meets when supported by additional information, the IRP
annual reporting criteria set forth in Sec. 905.14, IRP annual
reporting.
Western believes the EE/RE report is an acceptable alternative to
the IRP because of the associated energy efficiency and/or renewable
energy mandate.
In general, it is Western's belief that the reports for specific
Federal end-use customers under EO 13123 will be acceptable as EE/RE
reports. However, a requirement to comply with EO 13123 does not excuse
a Federal end-use customer from complying with this rule. Western does
not agree that a report submitted by a Federal agency in accordance
with EO 13123 should automatically be considered as meeting the EE/RE
reporting requirements. Any Federal end-use customer must first request
EE/RE report status and then submit reports that provide data specific
to that Federal end-use customer. Western must report to Congress
annually about the activities undertaken by its customers, so the
agency must receive adequate information, as specified in Sec. 905.17,
about the activities of the Federal end-use customer. Aggregate reports
of the agency where the end-use customer is only a part are not
acceptable. The EE/RE report must contain customer-specific data.
[[Page 16794]]
11. Sec. 905.18 What Are the Criteria for Western's Approval of
Submittals?
A. Comments
Some commenters noted that Western needs to clarify whether this
section applies to the small customer plan and new alternatives as well
as the IRP. A number of commenters said that there should be no IRP
reporting obligation in those States that have adopted retail
restructuring. Some commenters requested that water conservation
measures be allowed in addition to energy efficiency and renewable
energy in Western's alternatives. One commenter noted that ``shall''
was changed to ``will,'' and that there should be a clarifying
statement that this language change was editorial in nature.
B. Response
This section applies to small customer plans and new alternatives
as well as IRP. To make this clearer, Western changed the word ``IRP''
in the title of the section to ``plans and reports'' and moved this
section so that it follows the IRP, small customer provision, minimum
investment report, and EE/RE report sections.
Western does not agree that there should be no IRP reporting
obligation in those states that have adopted retail restructuring.
Neither wholesale nor retail competition negate Section 114 of EPAct.
Even though our customers may be subject to retail competition, Western
will continue to require each of its customers to comply with the IRP
or an applicable alternative under this rule.
Western has considered water planning, efficiency improvements, and
conservation in the same manner it considers energy planning and
efficiencies for IRP and small customer planning, as detailed in
Sec. 905.18(d). Accordingly, Western will consider water conservation
measures for the new alternatives, so long as the mandates for the new
alternatives extend to water conservation measures. Western will not
allow measures other than those identified by alternative-related
State, Tribal, or Federal mandates, and will additionally use the
reasonableness criteria as detailed in Section 114 of EPAct and
Sec. 905.18(a) in reviewing all plans and reports.
Western changed ``shall'' to ``will'' to comply with the
requirements for plain language. The change is editorial and does not
suggest any substantive change.
12. Sec. 905.19 How Are Plans and Reports Reviewed and Approved?
A. Comment
One comment suggested a time period for resubmittal of reports that
is similar to language in ``Western's review of IRPs'' paragraph be
included in Sec. 905.19, as well.
B. Response
Western agrees that time periods for resubmitting plans and reports
should be consistent. We have moved the ``Western's review of IRPs''
paragraph from Sec. 905.13 to Sec. 905.19, and added additional
language to clearly indicate the resubmittal timing pertains to IRPs,
small customer plans, minimum investment reports, and EE/RE reports.
13. Sec. 905.20 When Are Customers in Noncompliance With This Rule,
and How Does Western Ensure Compliance?
A. Comments
One comment suggested that instead of imposing the existing penalty
scheme for non-compliant customers, Western should penalize customers
up to the amount they ``under-spent'' on a given public benefits
program. A commenter also suggested that, for penalties, Western should
limit the liability to 10 percent of power charges and earmark the
penalty funds to a public benefits fund for investment in energy
efficiency and renewable energy in the non-complying customer's service
territory. One commenter noted that Western should clarify that the 30-
day good faith period for compliance applies to all plans and reports.
B. Response
Other than plain language revisions, and clarifications to ensure
that the penalties and 30-day good faith period are applicable to all
plans and reports, Western will not implement any changes to the
penalty provisions. The penalty scheme is mandated in Section 114 of
EPAct, and Western believes these standards are adequate to ensure
compliance with the rule.
14. Sec. 905.23 What Are the Opportunities for Using the Freedom of
Information Act (FOIA) To Request Plan and Report Data?
A. Comment
One commenter said that a reference to the exemptions under FOIA
should be added, and broadened to include 10 CFR part 1004.10. The
intent should be further clarified by designating as proprietary any
information that relates to State retail competition which state law
and/or regulation has classified as proprietary. One commenter said
that, if Western requests additional information to support Western's
review of IRP submittals, Western should agree to use due diligence in
protecting the information. The commenter also suggested Western ensure
customers have flexibility in determining a reasonable level of data
collection and reporting given individual situations.
B. Response
Western has removed the specific reference to 10 CFR part 1004.11,
and will not include a specific reference to 10 CFR part 1004.10,
recognizing that these references are too narrow, may change, and
therefore may not remain accurate. Instead, Western has added the term
``applicable'' in front of FOIA, to make it clear that any FOIA
exemptions may be requested and, if appropriate, granted. Western has
also added the phrase, ``recognizing that certain competition-related
customer information may be proprietary,'' to the end of the last
sentence.
Given customer concerns over proprietary and potentially
proprietary information, Western will accept summary information in the
IRP rather than full data. However, customers should not have unlimited
discretion in determining the amount of data required by Western.
Western is always willing to work with customers to ensure we receive
adequate, but not unnecessary, data. However, Western must have access
to sufficient data to verify that customers are meeting the intent of
EPAct and the IRP regulations. Western understands customers' concerns
over proprietary information, and will ensure that it applies FOIA
protections to customer information.
III. Procedural Requirements
A. Executive Order 12866
Western has an exemption from centralized regulatory review under
Executive Order 12866; accordingly, no clearance of this rulemaking by
the Office of Management and Budget (OMB) is required.
B. Review Under the Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980, 5 U.S.C. 601, et seq.,
requires Federal agencies to perform a regulatory flexibility analysis
if a proposed regulation is likely to have a significant economic
impact on a substantial number of small entities. Western's
Administrator certified that the proposed rule would have no
significant adverse impact on a substantial number of small entities
because the proposed
[[Page 16795]]
revisions to these regulations reduce paperwork and financial and other
burdens, as well as reporting redundancies for small entities. Western
did not receive any comments on this certification.
C. Review Under the Paperwork Reduction Act
In accordance with the Paperwork Reduction Act of 1980, 44 U.S.C.
3501-3520, Western has received approval from OMB to collect customer
information in this rule, under control number 1910-1200.
D. Review Under the National Environmental Policy Act
Western prepared an environmental impact statement (EIS) and record
of decision (ROD) pursuant to NEPA for EPAMP, which established the
existing IRP requirements for Western power customers. The EIS met the
requirements of NEPA, 42 U.S.C. 4321, et seq., the Council on
Environmental Quality Regulations for implementing NEPA (40 CFR parts
1500-1508), and the DOE NEPA Implementing Procedures and Guidelines (10
CFR part 1021). Since the proposed revisions would modify the IRP
requirements addressed in the EPAMP EIS, Western completed a review and
determined a supplemental EIS is not required. A revised EPAMP ROD has
been issued.
E. Review Under Executive Order 13132
Executive Order 13132 (64 FR 43255, August 4, 1999) imposes certain
requirements on agencies formulating and implementing policies or
regulations that preempt State law or that have federalism
implications. Agencies are required to examine the constitutional and
statutory authority supporting any action that would limit the
policymaking discretion of the States and carefully assess the need for
such actions. Western has examined this rule and determined that it
does not preempt State law and does not have a substantial direct
effect on the States, on the relationship between the national
government and the States, or on the distribution of power and
responsibilities among the various levels of government. No further
action is required by Executive Order 13132.
F. Review Under the Unfunded Mandates Reform Act of 1995
Title II of the Unfunded Mandates Reform Act of 1995 requires each
agency to assess the effects of Federal regulatory action on State,
local, and Tribal governments and the private sector. Western has
determined that this regulatory action does not impose an additional
Federal mandate on State, local, or Tribal governments or on the
private sector.
G. Review Under Executive Order 12988
With respect to the review of existing regulations and the
promulgation of new regulations, section 3(a) of Executive Order 12988,
``Civil Justice Reform'' (61 FR 4729, February 7, 1996), imposed on
Executive agencies the general duty to adhere to the following
requirements: (1) Eliminate drafting errors and ambiguity; (2) write
regulations to minimize litigation; and (3) provide a clear legal
standard for affected conduct rather than a general standard and
promote simplification and burden reduction. With regard to the review
required by section 3(a), section 3(b) of Executive Order 12988
specifically requires that Executive agencies make every reasonable
effort to ensure that the regulation: (1) Clearly specifies the
preemptive effect, if any; (2) clearly specifies any effect on existing
Federal law or regulation; (3) provides a clear legal standard for
affected conduct while promoting simplification and burden reduction;
(4) specifies the retroactive effect, if any; (5) adequately defines
key terms; and (6) addresses other important issues affecting clarity
and general draftsmanship under any guidelines issued by the Attorney
General. Section 3(c) of Executive Order 12988 requires Executive
agencies to review regulations in light of applicable standards in
section 3(a) and 3(b) to determine whether they are met or if it is
unreasonable to meet one or more of them. Western has completed the
required review and determined that, to the extent permitted by law,
the regulations meet the relevant standards of Executive Order 12988.
H. Treasury and General Government Appropriations Act, 1999
Section 654 of the Treasury and General Government Appropriations
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family
Policymaking Assessment for any proposed rule that may affect family
well-being. The final rule has no impact on the autonomy or integrity
of the family as an institution. Accordingly, Western has concluded
that it is not necessary to prepare a Family Policymaking Assessment.
I. Review Under Executive Order 13084
Under Executive Order 13084 (Consultation and Coordination with
Indian Tribal Governments), Western may not issue a discretionary rule
that significantly or uniquely affects Indian tribal governments and
imposes substantial direct compliance costs. The incremental amendments
involved in this rulemaking would not have such effects. Accordingly,
Executive Order 13084 does not apply to this rulemaking.
J. Review Under Small Business Regulatory Enforcement Fairness Act of
1996
As required by 5 U.S.C. 801, DOE will report to Congress on the
promulgation of the rule prior to its effective date. The report will
state that it has been determined that the rule is not a ``major rule''
as defined by 5 U.S.C. 804(3).
List of Subjects in 10 CFR Part 905
Electric power, Electric utilities, Energy, Energy conservation,
Hydroelectric power and utilities.
Issued in Lakewood, CO on March 13, 2000.
Michael S. Hacskaylo,
Administrator.
For the reasons set forth in the preamble, 10 CFR part 905 is
amended as set forth below:
PART 905--ENERGY PLANNING AND MANAGEMENT PROGRAM
1. The authority citation continues to read as follows:
Authority: 42 U.S.C. 7152 and 7191; 32 Stat. 388, as amended;
and 42 U.S.C. 7275-7276c.
2. Subparts A and B are revised to read as follows:
Subpart A--General Provisions
Sec.
905.1 What are the purposes of the Energy Planning and Management
Program?
905.2 What are the key definitions of this part?
Subpart B--Integrated Resource Planning
905.10 Who must comply with the integrated resource planning and
reporting regulations in this subpart?
905.11 What must an IRP include?
905.12 How must IRPs be submitted?
905.13 When must IRPs be submitted?
905.14 Does Western require annual IRP progress reports?
905.15 What are the requirements for the small customer plan
alternative?
905.16 What are the requirements for the minimum investment report
alternative?
905.17 What are the requirements for the energy efficiency and/or
renewable energy report (EE/RE report) alternative?
905.18 What are the criteria for Western's approval of submittals?
905.19 How are plans and reports reviewed and approved?
905.20 When are customers in noncompliance with the regulations in
this subpart, and how does Western ensure compliance?
[[Page 16796]]
905.21 What is the administrative appeal process?
905.22 How does Western periodically evaluate customer actions?
905.23 What are the opportunities for using the Freedom of
Information Act to request plan and report data?
905.24 Will Western conduct reviews of this program?
Subpart A--General Provisions
Sec. 905.1 What are the purposes of the Energy Planning and Management
Program?
The purposes of the Energy Planning and Management Program (EPAMP)
are to meet the objectives of Section 114 of the Energy Policy Act of
1992 (EPAct) and to extend long-term firm power resource commitments
while supporting customer integrated resource planning (IRP); demand-
side management (DSM), including energy efficiency, conservation, and
load management; and the use of renewable energy. Subpart B, Integrated
Resource Planning, allows customers of the Western Area Power
Administration (Western) to meet the objectives of section 114 of EPAct
through integrated resource planning or by other means, such as
attaining a minimum level of investment in energy efficiency and/or
renewable energy, collecting a charge to support defined public
benefits, or complying with a mandated energy efficiency and/or
renewable energy reporting requirement.
Sec. 905.2 What are the key definitions of this part?
Administrator means Western's Administrator.
Customer means any entity that purchases firm capacity, with or
without energy, from Western under a long-term firm power contract. The
term also includes a member-based association (MBA) and its
distribution or user members that receive direct benefit from Western's
power, regardless of which holds the contract with Western.
Energy efficiency and/or renewable energy (EE/RE) report means the
report documenting energy efficiency and/or renewable energy activities
imposed by a State, Tribal, or the Federal Government upon a State,
Tribal, or Federal end-use customer within its jurisdiction.
Integrated resource planning means a planning process for new
energy resources that evaluates the full range of alternatives,
including new generating capacity, power purchases, energy conservation
and efficiency, cogeneration and district heating and cooling
applications, and renewable energy resources, to provide adequate and
reliable service to a customer's electric consumers.
Integrated resource planning cooperative (IRP cooperative) means a
group of Western's customers and/or their distribution or user members
with geographic, resource supply, or other similarities that have
joined together, with Western's approval, to complete an IRP.
Member-based association (MBA) means:
(1) An entity composed of member utilities or user members, or
(2) An entity that acts as an agent for, or subcontracts with, but
does not assume power supply responsibility for its principals or
subcontractors, who are its members.
Minimum investment report means the report documenting a mandatory
minimum level of financial or resource investment in demand-side
management (DSM) initiatives, including energy efficiency and load
management, and/or renewable energy activities, such as investment of a
set minimum percentage of the utility's gross revenues in renewable
energy, which is imposed by State, Tribal, or Federal law upon a
customer under its jurisdiction. For the purposes of this part, the
minimum investment report includes reports about public benefits
charges, as well.
Public benefits charge means a mandatory financial charge imposed
by State, Tribal, or Federal law upon a customer under its jurisdiction
to support one or more of the following: energy efficiency,
conservation, or demand-side management; renewable energy; efficiency
or alternative energy-related research and development; low-income
energy assistance; and/or other similar programs defined by applicable
State, Tribal, or Federal law. This term is also known as a public
goods or system benefit charge in the utility industry.
Region means a Western regional office or management center, and
the geographic territory served by that regional office or management
center: the Desert Southwest Customer Service Region, the Rocky
Mountain Customer Service Region, the Sierra Nevada Customer Service
Region, the Upper Great Plains Customer Service Region, or the Colorado
River Storage Project Management Center.
Renewable energy means any source of electricity that is self-
renewing, including plant-based biomass, waste-based biomass,
geothermal, hydropower, ocean thermal, solar (active and passive), and
wind.
Small customer means a utility customer with total annual sales and
usage of 25 gigawatthours (GWh) or less, as averaged over the previous
5 years, which is not a member of a joint-action agency or generation
and transmission cooperative with power supply responsibility; or any
end-use customer.
Western means the Western Area Power Administration.
Subpart B--Integrated Resource Planning
Sec. 905.10 Who must comply with the integrated resource planning and
reporting regulations in this subpart?
(a) Integrated resource plans (IRP) and alternatives. Each Western
customer must address its power resource needs in an IRP prepared and
submitted to Western as described in this subpart. Alternatively,
Western customers may submit a small customer plan, minimum investment
report or EE/RE report as provided in this subpart.
(b) Rural Utility Service and state utility commission reports. For
customers subject to IRP filings or other electrical resource use
reports from the Rural Utilities Service or a state utility commission,
nothing in this part requires a customer to take any action
inconsistent with those requirements.
Sec. 905.11 What must an IRP include?
(a) General. Integrated resource planning is a planning process for
new energy resources that evaluates the full range of alternatives,
including new generating capacity, power purchases, energy conservation
and efficiency, cogeneration and district heating and cooling
applications, and renewable energy resources, to provide adequate and
reliable service to a customer's electric consumers. An IRP supports
customer-developed goals and schedules. The plan must take into account
necessary features for system operation, such as diversity,
reliability, dispatchability, and other risk factors; must take into
account the ability to verify energy savings achieved through energy
efficiency and the projected durability of such savings measured over
time; and must treat demand and supply resources on a consistent and
integrated basis.
(b) IRP criteria. IRPs must consider electrical energy resource
needs and may consider, at the customer's option, water, natural gas,
and other energy resources. Each IRP submitted to Western must include:
(1) Identification of resource options. Identification and
comparison of resource options is an assessment and comparison of
existing and future supply-and demand-side resource options available
to a customer based
[[Page 16797]]
upon its size, type, resource needs, geographic area, and competitive
situation. Resource options evaluated by the specific customer must be
identified. The options evaluated should relate to the resource
situation unique to each Western customer as determined by profile data
(such as service area, geographical characteristics, customer mix,
historical loads, projected growth, existing system data, rates, and
financial information) and load forecasts. Specific details of the
customer's resource comparison need not be provided in the IRP itself.
They must, however, be made available to Western upon request.
(i) Supply-side options include, but are not limited to, purchased
power contracts and conventional and renewable generation options.
(ii) Demand-side options alter the customer's use pattern to
provide for an improved combination of energy services to the customer
and the ultimate consumer.
(iii) Considerations that may be used to develop potential options
include cost, market potential, consumer preferences, environmental
impacts, demand or energy impacts, implementation issues, revenue
impacts, and commercial availability.
(iv) The IRP discussion of resource options must describe the
options chosen by the customer, clearly demonstrating that decisions
were based on a reasonable analysis of the options. The IRP may strike
a balance among the applicable resource evaluation factors.
(2) Action plan. IRPs must include an action plan describing
specific actions the customer will take to implement its IRP.
(i) The IRP must state the time period that the action plan covers,
and the action plan must be updated and resubmitted to Western when
this time period expires. The customer may submit a revised action plan
with the annual IRP progress report discussed in Sec. 905.14.
(ii) For those customers not experiencing or anticipating load
growth, the action plan requirement for the IRP may be satisfied by a
discussion of current actions and procedures in place to periodically
reevaluate the possible future need for new resources. The action plan
must include a summary of:
(A) Actions the customer expects to take in accomplishing the goals
identified in the IRP;
(B) Milestones to evaluate accomplishment of those actions during
implementation; and
(C) Estimated energy and capacity benefits for each action planned.
(3) Environmental effects. To the extent practical, the customer
must minimize adverse environmental effects of new resource
acquisitions and document these efforts in the IRP. Customers are
neither precluded from nor required to include a quantitative analysis
of environmental externalities as part of the IRP process. IRPs must
include a qualitative analysis of environmental effects in summary
format.
(4) Public participation. The customer must provide ample
opportunity for full public participation in preparing and developing
an IRP (or any IRP revision or amendment). The IRP must include a brief
description of public involvement activities, including how the
customer gathered information from the public, identified public
concerns, shared information with the public, and responded to public
comments. Customers must make additional documentation identifying or
supporting the full public process available to Western upon request.
(i) As part of the public participation process, the governing body
of an MBA and each MBA member (such as a board of directors or city
council) must approve the IRP, confirming that all requirements have
been met. To indicate approval, a responsible official must sign the
IRP submitted to Western or the customer must document passage of an
approval resolution by the appropriate governing body included or
referred to in the IRP.
(ii) For Western customers that do not purchase electricity for
resale, such as some State, Tribal, and Federal agencies, the customer
can satisfy the public participation requirement by having a top
management official with resource acquisition responsibility review and
concur on the IRP. The customer must note this concurrence in the IRP.
(5) Load forecasting. An IRP must include a statement that the
customer conducted load forecasting. Load forecasting should include
data that reflects the size, type, resource conditions, and demographic
nature of the customer using an accepted load forecasting method,
including but not limited to the time series, end-use, and econometric
methods. The customer must make the load forecasting data available to
Western upon request.
(6) Measurement strategies. The IRP must include a brief
description of measurement strategies for options identified in the IRP
to determine whether the IRP's objectives are being met. These
validation methods must include identification of the baseline from
which a customer will measure the benefits of its IRP implementation. A
reasonable balance may be struck between the cost of data collection
and the benefits resulting from obtaining exact information. Customers
must make performance validation and evaluation data available to
Western upon request.
(c) IRP criteria for certain customers not qualifying for ``small
customer'' status. Customers with limited economic, managerial, and
resource capability and total annual sales and usage of 25
gigawatthours (GWh) or less who are members of joint-action agencies
and generation and transmission cooperatives with power supply
responsibility are eligible for the criteria specified in paragraphs
(c)(1) and (c)(2) of this section.
(1) Each IRP submitted by a customer under paragraph (c) of this
section must:
(i) Consider all reasonable opportunities to meet future energy
service requirements using DSM techniques, renewable energy resources,
and other programs; and
(ii) Minimize, to the extent practical, adverse environmental
effects.
(2) Each IRP submitted by a customer under paragraph (c) of this
section must include, in summary form:
(i) Customer name, address, phone number, email and Website if
applicable, and contact person;
(ii) Customer type;
(iii) Current energy and demand profiles, and data on total annual
energy sales and usage for the past 5 years, which Western will use to
verify that customers qualify for these criteria;
(iv) Future energy services projections;
(v) How items in paragraphs (c)(1)(i) and (c)(1)(ii) of this
section were considered; and
(vi) Actions to be implemented over the customer's planning
timeframe.
Sec. 905.12 How must IRPs be submitted?
(a) Number of IRPs submitted. Except as provided in paragraph (c)
of this section, one IRP is required per customer, regardless of the
number of long-term firm power contracts between the customer and
Western.
(b) Method of submitting IRPs. Customers must submit IRPs to
Western under one of the following options:
(1) Customers may submit IRPs individually.
(2) MBAs may submit IRPs for each of their members or submit one
IRP on behalf of all or some of their members. An IRP submitted by an
MBA must specify the responsibilities and participation levels of
individual members and the MBA. Any member of an MBA may submit an
individual IRP
[[Page 16798]]
to Western instead of being included in an MBA IRP.
(3) Customers may submit IRPs as IRP cooperatives when previously
approved by Western. IRP cooperatives may also submit small customer
plans, minimum investment reports and EE/RE reports on behalf of
eligible IRP cooperative members.
(c) Alternatives to submitting individual IRPs. Customers with
Western approval to submit small customer plans, minimum investment or
EE/RE reports may substitute the applicable plan or report instead of
an IRP. Each customer that intends to seek approval for IRP
cooperative, small customer, minimum investment report or EE/RE report
status must provide advance written notification to Western. A new
customer must provide this notification to the Western Regional Manager
of the Region in which the customer is located within 30 days from the
time it becomes a customer. Any customer may resubmit an IRP or notify
Western of its plan to change its compliance method at any time so long
as there is no period of noncompliance.
Sec. 905.13 When must IRPs be submitted?
(a) Submitting the initial IRP. Except as provided in paragraph (c)
of this section, customers that have not previously had an IRP approved
by Western must submit the initial IRP to the appropriate Regional
Manager no later than 1 year after May 1, 2000, or after becoming a
customer, whichever is later.
(b) Updates and amendments to IRPs. Customers must submit updated
IRPs to the appropriate Regional Manager every 5 years after Western's
approval of the initial IRP. Customers that complied with Western's IRP
regulations in effect before May 1, 2000 must maintain their submission
and resubmission schedules previously in effect. Customers may submit
amendments and revisions to IRPs at any time.
(c) IRP cooperatives. Customers with geographic, resource supply,
and other similarities may join together and request, in writing,
Western's approval to become an IRP cooperative. Western will respond
to IRP cooperative status requests within 30 days of receiving a
request. If Western disapproves a request for IRP cooperative status,
the requesting participants must maintain their currently applicable
integrated resource or small customer plans, or submit the initial IRPs
no later than 1 year after the date of the disapproval letter.
Western's approval of IRP cooperative status will not be based on any
potential participant's contractual status with Western. Each IRP
cooperative must submit an IRP for its participants within 18 months
after Western approves IRP cooperative status.
Sec. 905.14 Does Western require annual IRP progress reports?
Yes, customers must submit IRP progress reports each year within 30
days of the anniversary date of the approval of the currently
applicable IRP. The reports must describe the customer's
accomplishments achieved under the action plan, including projected
goals and implementation schedules, and energy and capacity benefits
and renewable energy developments achieved as compared to those
anticipated. Western prefers measured values, but will accept
reasonable estimates if measurement is infeasible or not cost-
effective. Instead of a separate progress report, the customer may use
any other annual report that the customer submits to Western or another
entity, at the customer's discretion, if that report contains all
required data for the previous full year and is submitted within 30
days of the approval anniversary date of the currently applicable IRP.
With Western's approval, customers may submit reports outside of the
30-day anniversary date window.
Sec. 905.15 What are the requirements for the small customer plan
alternative?
(a) Requesting small customer status. Small customers may submit a
request to prepare a small customer plan instead of an IRP. Requests
for small customer status from electric utilities must include data on
total annual energy sales and usage for the 5 years prior to the
request. Western will average this data to determine overall annual
energy sales and usage so that uncontrollable events, such as extreme
weather, do not distort levelized energy sales and usage. Requests from
end-use customers must only document that the customer does not
purchase electricity for resale. Western will respond to small customer
status requests within 30 days of receiving the request. If Western
disapproves a request, the customer must maintain its currently
applicable IRP, or submit the initial IRP no later than 1 year after
the date of the disapproval letter. Alternatively, the customer may
submit a request for minimum investment report or EE/RE report status,
as appropriate.
(b) Small customer plan contents. Small customer plans must:
(1) Consider all reasonable opportunities to meet future energy
service requirements using demand-side management techniques, renewable
energy resources, and other programs that provide retail consumers with
electricity at reasonable cost;
(2) Minimize, to the extent practical, adverse environmental
effects; and
(3) Present in summary form the following information:
(i) Customer name, address, phone number, email and Website if
applicable, and contact person;
(ii) Type of customer;
(iii) Current energy and demand profiles and data on total annual
energy sales and usage for the previous 5 years for utility customers,
or current energy and demand use for end-use customers;
(iv) Future energy services projections;
(v) How items in paragraphs (b)(1) and (b)(2) of this section were
considered; and
(vi) Actions to be implemented over the customer's planning
timeframe.
(c) When to submit small customer plans. Small customers must
submit the first small customer plan to the appropriate Western
Regional Manager within 1 year after Western approves the request for
small customer status. Small customers must submit, in writing, a small
customer plan every 5 years.
(d) Maintaining small customer status. (1) Every year on the
anniversary of Western's approval of the plan, small customers must
submit a letter to Western verifying that either their annual energy
sales and usage is 25 GWh or less averaged over the previous 5 years,
or they continue to be end-use customers. The letter must also identify
their achievements against targeted action plans, as well as the
revised summary of actions if the previous summary of actions has
expired.
(2) Western will use the letter for overall program evaluation and
comparison with the customer's plan, and for verification of continued
small customer status. Customers may submit annual update letters
outside of the anniversary date if previously agreed to by Western so
long as the letter contains all required data for the previous full
year.
(e) Losing eligibility for small customer status. (1) A customer
ceases to be a small customer if it:
(i) Is a utility customer and exceeds total annual energy sales and
usage of 25 GWh, as averaged over the previous 5 years; or
(ii) Is no longer an end-use customer.
(2) Western will work with a customer that loses small customer
status to develop an appropriate schedule for submitting an IRP or
other report required under this subpart.
[[Page 16799]]
Sec. 905.16 What are the requirements for the minimum investment
report alternative?
(a) Request to submit the minimum investment report. Customers may
submit a request to prepare a minimum investment report instead of an
IRP. Minimum investment reports may be submitted by MBAs on behalf of
the MBA or its members, and by IRP cooperatives on behalf of its
participants. Requests to submit minimum investment reports must
include data on:
(1) The source of the minimum investment requirement (number,
title, date, and jurisdiction of law);
(2) The initial, annual, and other reporting requirement(s) of the
mandate, if any; and
(3) The mandated minimum level of investment or public benefits
charge for DSM and/or renewable energy.
(b) Minimum investment requirement. The minimum investment must be
either:
(1) A mandatory set percentage of customer gross revenues or other
specific minimum investment in DSM and/or renewable energy mandated by
a State, Tribal, or Federal Government with jurisdictional authority;
or
(2) A required public benefits charge, including charges to be
collected for and spent on DSM; renewable energy; efficiency and
alternative energy-related research and development; low-income energy
assistance; and any other applicable public benefits category, mandated
by a State, Tribal, or Federal Government with jurisdictional
authority. Participation in a public benefits program requires either a
mandatory set percentage of customer gross revenues or other specific
charges to be applied toward the programs as determined by the
applicable State, Tribal, or Federal authority. The revenues from the
public benefits charge may be expended directly by the customer, or by
another entity on behalf of the customer as determined by the
applicable State, Tribal, or Federal authority.
(c) Multi-state entities. For those customers with service
territories lying in more than one State or Tribal jurisdiction, and
where at least one of the States or Tribal jurisdictions has a mandated
minimum investment requirement, to meet this alternative customers must
use the highest requirement from the State or Tribe within the
customer's service territory and additionally apply it to all members
in those States or Tribal jurisdictions in which there is no
requirement. Alternatively, if each State or Tribe has a requirement,
customers may satisfy Western's requirement by reporting on compliance
with each applicable minimum investment requirement. Western will work
with multi-state entities to ensure the most effective, and least
burdensome, compliance mechanism.
(d) Western's response to minimum investment report requests.
Western will respond to requests to accept minimum investment reports
within 30 days of receiving the request. If Western disapproves a
request to allow use of the minimum investment report, the customer
must maintain its currently applicable IRP or small customer plan, or
submit its initial IRP no later than 1 year after the date of the
disapproval letter. Alternatively, the customer may submit a request
for small customer plan or EE/RE report status, as appropriate.
(e) Minimum investment report contents. Reports documenting
compliance with a minimum level of investment in DSM and/or renewable
energy must include:
(1) Customer name, address, phone number, email and Website if
applicable, and contact person;
(2) Authority or requirement to undertake a minimum investment,
including the source of the minimum investment requirement (number,
title, date, and jurisdiction of law or regulation); and
(3) A description of the minimum investment, including:
(i) Minimum percentage or other minimum requirement for DSM and/or
renewable energy, including any charges to be collected for and spent
on DSM, renewable energy, efficiency or alternative energy-related
research and development, low-income energy assistance, and any other
applicable public benefits categories;
(ii) Actual or estimated energy and/or capacity savings resulting
from minimum investments in DSM, if known;
(iii) Actual or estimated energy and/or capacity resulting from
minimum investments in renewable energy, if known; and
(iv) A description of the DSM and/or renewable energy activities to
be undertaken over the next 2 years as a result of the requirement for
minimum investment, if known.
(f) Minimum investment report approval. Western will approve the
minimum investment report when it meets the requirements in paragraph
(e) of this section.
(g) When to submit the minimum investment report. The customer must
submit the first minimum investment report to the appropriate Western
Regional Manager within 1 year after Western approves the request to
accept the minimum investment report. Customers choosing this option
must maintain IRP or small customer plan compliance with Western's IRP
regulations in effect before May 1, 2000, including submitting annual
progress reports or update letters, until submitting the first minimum
investment report, to ensure there is no gap in complying with section
114 of EPAct. Customers must submit, in writing, a minimum investment
report every 5 years.
(h) Maintaining minimum investment reports. (1) Every year on the
anniversary of Western's approval of the first minimum investment
report, customers choosing this option must submit a letter to Western
verifying that they remain in compliance with the minimum investment
requirement. The letter must also contain summary information
identifying annual energy and capacity savings associated with minimum
investments in DSM, if known, and energy and capacity associated with
minimum investments in renewable energy, if known. The letter must also
include a revised description of customer DSM and/or renewable energy
activities if the description from the minimum investment report has
changed or expired.
(2) Western will use the letter for overall program evaluation and
to ensure customers remain in compliance. Customers may submit letters
outside of the anniversary date if previously agreed to by Western, and
if the letter contains all required data for the previous full year.
Instead of a separate letter, a customer choosing this option may
submit the State, Tribal, or Federal required annual report documenting
the minimum investment and associated DSM and/or renewable energy
savings and/or use, if known.
(i) Loss of eligibility to submit the minimum investment report.
(1) A customer ceases to be eligible to submit a minimum investment
report if:
(i) A State, Tribal, or Federal mandate no longer applies to the
customer, or
(ii) The customer does not comply with the minimum level of
investment in applicable State, Tribal, or Federal law.
(2) Western will work with a customer no longer eligible to submit
a minimum investment report to develop an appropriate schedule to
submit an IRP or other plan or report required under this subpart.
[[Page 16800]]
Sec. 905.17 What are the requirements for the energy efficiency and/or
renewable energy report (EE/RE report) alternative?
(a) Requests to submit an EE/RE report. End-use customers may
submit a request to prepare an EE/RE report instead of an IRP. Requests
to submit EE/RE reports must include data on:
(1) The source of the EE/RE reporting requirement (number, title,
date, and jurisdiction of law or regulation);
(2) The initial, annual, and other reporting requirement(s) of the
report; and
(3) A summary outline of the EE/RE report's required data or
components, including any requirements for documenting customer energy
efficiency and renewable energy activities.
(b) EE/RE report requirement. The EE/RE report is based on a
mandate by a State, Tribal, or Federal Government to implement energy
efficiency and/or renewable energy activities within a specified
timeframe, for which there is also an associated reporting requirement.
The EE/RE report may include only electrical resource use and energy
efficiency and/or renewable energy activities, or may additionally
include other resource information, such as water and natural gas data.
At a minimum, the EE/RE report must annually document energy efficiency
and/or renewable energy activities undertaken by the end-use customer.
(c) Western's response to EE/RE report requests. Western will
respond to requests to accept EE/RE reports within 30 days of receiving
the request. If Western disapproves a request to allow use of the EE/RE
report, the customer must maintain its currently applicable IRP or
small customer plan, or submit its initial IRP no later than 1 year
after the date of the disapproval letter. Alternatively, the customer
may submit a request for small customer plan or minimum investment
report, as appropriate, within 30 days after the date of the
disapproval letter.
(d) EE/RE report contents. EE/RE reports must include:
(1) Customer name, address, phone number, email and Website if
applicable, and contact person;
(2) Authority or requirement to complete the EE/RE report,
including the source of the requirement (number, title, date, and
jurisdiction of law); and
(3) A description of the customer's required energy efficiency and/
or renewable energy activities, including:
(i) Level of investment or expenditure in energy efficiency and/or
renewable energy, and quantifiable energy savings or use goals, if
defined by the EE/RE reporting requirement;
(ii) Annual actual or estimated energy and/or capacity savings, if
any, associated with energy efficiency and resulting from the EE/RE
reporting requirement;
(iii) Actual or estimated energy and/or capacity, if any,
associated with renewable energy and resulting from the EE/RE reporting
requirement;
(iv) A description of the energy efficiency and/or renewable energy
activities to be undertaken over the next 2 years as a result of the
EE/RE reporting requirement.
(e) EE/RE report approval. Western will approve the EE/RE report
when the report meets the requirements in paragraph (d) of this
section.
(f) When to submit the EE/RE report. The customer must submit the
first EE/RE report to the appropriate Western Regional Manager within 1
year after Western approves the request to accept the EE/RE report.
Customers choosing this option must maintain IRP or small customer plan
compliance with Western's IRP regulations in effect before May 1, 2000,
including submitting annual progress reports or update letters, until
submitting the first EE/RE report to ensure there is no gap in
complying with section 114 of EPAct. Customers must submit, in writing,
an EE/RE report every 5 years.
(g) Maintaining EE/RE reports. (1) Every year on the anniversary of
Western's approval of the first EE/RE report, customers choosing this
option must submit an annual EE/RE letter to Western. The letter must
contain summary information identifying customer annual energy and
capacity savings associated with energy efficiency, if any, and annual
customer energy and capacity associated with renewable energy, if any.
The letter must also verify that the customer remains in compliance
with the EE/RE reporting requirement. Additionally, the letter must
include a revised description of customer DSM and/or renewable energy
activities if the description from the EE/RE report has changed or
expired. If this information is contained in an EE/RE report sent to
another authority, the customer may submit that report instead of a
separate letter.
(2) Customers may submit annual EE/RE letters outside of the
anniversary date if previously agreed to by Western if the letter
contains all required data for the previous full year.
(h) Loss of eligibility to submit the EE/RE report. (1) A customer
ceases to be eligible to submit a EE/RE report if:
(i) The EE/RE reporting requirement no longer applies to the
customer, or
(ii) The customer does not comply with the EE/RE reporting
requirements in applicable State, Tribal, or Federal law.
(2) Western will work with a customer no longer eligible to submit
an EE/RE report to develop an appropriate schedule to submit a small
customer plan or other plan or report required under this subpart.
Sec. 905.18 What are the criteria for Western's approval of
submittals?
(a) Approval criteria. Western will approve all plans and reports
based upon:
(1) Whether the plan or report satisfactorily addresses the
criteria in the regulations in this subpart; and
(2) The reasonableness of the plan or report given the size, type,
resource needs, geographic area, and competitive situation of the
customer.
(b) Review of resource choices. Western will review resource
choices using section 114 of EPAct and this subpart. Western will
disapprove plans and reports if Western deems that they do not meet the
reasonableness criteria in paragraph (a)(2) of this section or the
provisions of section 114 of EPAct.
(c) Accepting plans and reports under other initiatives. If a
customer or group of customers implements integrated resource planning
under a program responding to other Federal, Tribal, or State
initiatives, Western will accept and approve the plan or report as long
as it substantially complies with the requirements of this subpart.
(d) Water-based plans and reports. In evaluating a plan or report,
Western will consider water planning, efficiency improvements, and
conservation in the same manner it considers energy planning and
efficiencies. Customers that provide water utility services and
customers that service irrigation load as part of their overall load
may include water conservation activities in their plans or reports. To
the extent practical, customers should convert reported water savings
to energy values.
Sec. 905.19 How are plans and reports reviewed and approved?
Western will review all plans and reports submitted under this
subpart and notify the submitting entity of the plan's or report's
acceptability within 120 days after receiving it. If a plan or report
submittal is insufficient, Western will provide a notice of
deficiencies to the entity that submitted the plan or report. Western,
working together with the entity, will determine the time allowable for
resubmitting the plan or report. However, the time allowed for
resubmittal will not be greater than 9 months after the disapproval
date, unless otherwise provided by applicable contract language.
[[Page 16801]]
Sec. 905.20 When are customers in noncompliance with the regulations
in this subpart, and how does Western ensure compliance?
(a) Good faith effort to comply. If it appears that a customer's
activities may be inconsistent with the applicable IRP, small customer
plan, minimum investment report or EE/RE report, Western will notify
the customer and offer the customer 30 days to provide evidence of its
good faith effort to comply. If the customer does not correct the
specified deficiency or submit such evidence, or if Western finds,
after receiving information from the customer, that a good faith effort
has not been made, Western will impose a penalty.
(b) Penalties for noncompliance. Western will impose a penalty on
long-term firm power customers for failing to submit or resubmit an
acceptable IRP and action plan, small customer plan, minimum investment
report or EE/RE report as required by this subpart. Western will also
impose a penalty when the customer's activities are not consistent with
the applicable plan or report unless Western finds that a good faith
effort has been made to comply with the approved plan or report.
(c) Written notification of penalty. Western will provide written
notice of a penalty to the customer, and to the MBA or IRP cooperative
when applicable. The notice will specify the reasons for the penalty.
(d) Penalty options. (1) Beginning with the first full billing
period following the notice specified in paragraph (c) of this section,
Western will impose a surcharge of 10 percent of the monthly power
charges until the deficiency specified in the notice is cured, or until
12 months pass. However, Western will not immediately impose a penalty
if the customer or its MBA or IRP cooperative requests reconsideration
by filing a written appeal under Sec. 905.21.
(2) The surcharge increases to 20 percent for the second 12 months
and to 30 percent per year thereafter until the deficiency is cured.
(3) After the first 12 months of the surcharge and instead of
imposing any further surcharge, Western may impose a penalty that would
reduce the resource delivered under a customer's long-term firm power
contract(s) by 10 percent. Western may impose this resource reduction
either:
(i) When it appears to be more effective to ensure customer
compliance, or
(ii) When such reduction may be more cost-effective for Western.
(4) The penalty provisions in existing contracts will continue to
be in effect and administered and enforced according to applicable
contract provisions.
(e) Assessing and ceasing penalties. Western will assess the
surcharge on the total charges for all power obtained by a customer
from Western and will not be limited to surcharges on only firm power
sales. When a customer resolves the deficiencies, Western will cease
imposing the penalty, beginning with the first full billing period
after compliance is achieved.
(f) Penalties on MBAs and IRP cooperatives. In situations involving
a plan or report submitted by an MBA on behalf of its members where a
single member does not comply, Western will impose a penalty upon the
MBA on a pro rata basis in proportion to that member's share of the
total MBA's power received from Western. In situations involving
noncompliance by a participant of an IRP cooperative, Western will
impose any applicable penalty directly upon that participant if it has
a firm power contract with Western. If the IRP cooperative participant
does not have a firm power contract with Western, then Western will
impose a penalty upon the participant's MBA on a pro rata basis in
proportion to that participant's share of the total MBA's power
received from Western.
Sec. 905.21 What is the administrative appeal process?
(a) Filing written appeals with Western. If a customer disagrees
with Western's decision on the acceptability of its IRP, small customer
plan, minimum investment report or EE/RE report submittal, its
compliance with an approved plan or report, or any other compliance
issue, the customer may request reconsideration by filing a written
appeal with the appropriate Regional Manager. Customers may submit
appeals any time such disagreements occur and should be specific as to
the nature of the issue, the reasons for the disagreement, and any
other pertinent facts the customer believes should be brought to
Western's attention. The Regional Manager will respond within 45 days
of receiving the appeal. If resolution is not achieved at the Regional
Office level, the customer may appeal to the Administrator, who will
respond within 30 days of receiving the appeal.
(b) Alternative dispute resolution. Upon request, Western will
agree to use mutually agreeable alternative dispute resolution
procedures, to the extent allowed by law, to resolve issues or disputes
relating to compliance with the regulations in this subpart.
(c) Penalties during appeal. Western will not impose a penalty
while an appeal process is pending. However, if the appeal is
unsuccessful for the customer, Western will impose the penalty
retroactively from the date the penalty would have been assessed if an
appeal had not been filed.
(d) Meeting other requirements during appeal process. A written
appeal or use of alternative dispute resolution procedures does not
suspend other reporting and compliance requirements.
Sec. 905.22 How does Western periodically evaluate customer actions?
(a) Periodic review of customer actions. Western will periodically
evaluate customer actions to determine whether they are consistent with
the approved IRP or minimum investment report. Small customer plans and
EE/RE reports are not subject to this periodic review.
(b) Reviewing representative samples of plans and reports. Western
will periodically review a representative sample of IRPs and minimum
investment reports, and the customer's implementation of the applicable
plan or report from each of Western's Regions. The samples will reflect
the diverse characteristics and circumstances of the customers that
purchase power from Western. These reviews will be in addition to, and
separate and apart from, the review of initial and updated IRPs and
minimum investment reports to ensure compliance with this subpart.
(c) Scope of periodic reviews. Periodic reviews may consist of any
combination of review of the customer's annual IRP progress reports,
minimum investment letters, telephone interviews, or on-site visits.
Western will document these periodic reviews and may report on the
results of the reviews in Western's annual report.
Sec. 905.23 What are the opportunities for using the Freedom of
Information Act to request plan and report data?
IRPs, small customer plans, minimum investment reports and EE/RE
reports and associated data submitted to Western are subject to the
Freedom of Information Act (FOIA) and may be made available to the
public upon request. Customers may request confidential treatment of
all or part of a submitted document under applicable FOIA exemptions.
Western will make its own determination whether particular information
is exempt from public access. Western will not disclose to the public
information it has determined to
[[Page 16802]]
be exempt, recognizing that certain competition-related customer
information may be proprietary.
Sec. 905.24 Will Western conduct reviews of this program?
Yes, Western may periodically initiate a public process to review
the regulations in this subpart to determine whether they should be
revised to reflect changes in technology, needs, or other developments.
[FR Doc. 00-7745 Filed 3-29-00; 8:45 am]
BILLING CODE 6450-01-P