HomeMy WebLinkAbout1999-12-10 TDPUD ,Staff Report
December 10, 1999
' To: Board of Directors
From: Stephen 1-lollabaugh—Power Supply Engineer
Subject: Sierra Pacific Power Company—FERC Cases Status Report
AGENDA # 7
Background:
The District has had the long-term goal of realizing long term transmission access in
order to receive market rate prices for energy delivered to our customers. The District
has been working toward this goal for many many years.
Great News: The District has obtained a long term Network
Integration Transmission Service Agreement from Sierra Pacific
and FERC has accepted it Docket Nos. ER97-3593-000 and ER97-4462-
000.The agreement gives the District the right to import Energy and Capacity from
outside Sierra Pacific's transmission control area to meet its load including load growth,
starting in 1999 until 2027. Attached is a copy of the agreement that was signed in mid
September and the FERC order accepting the agreement dated November 10, 1999.
Below is a brief update on several FERC Dockets that the District is or has been
involved with:
• Docket No. ER99-2339 and ER99-34-000: (Transmission Rate Increase
Filing) Settled: Sierra has also fled a Transmission tariff rate change that
adds the Alturas transmission fine into the revenue requirements and also
included a transmission plant refunctionalization to distribution. This has been
settled. Through negotiations and many settlement meetings, the
Transmission Rate Tariff has been settled. The new transmission rate
includes the Alturas line. Sierra Pacific originally wanted an annual
Transmission Revenue requirement (ATRR) of$54 million dollars from the
current$38.6 million prior to the Alturas line. The District was very influential
within this process and requested a substantially lower number initially.
Eventually this was settled with out going to hearing at $48.6 million dollars.
This will raise the Districts transmission rates slightly but i feel this is a fair
rate.
• Docket No. ER99-2332-000: "Generation Aggregation Tariff"(GAT) Filing.
This filing dovetails their Merger and Generation Divestiture that is a part of
the merger case. The District has also intervened. The District has taken a
position on this consistent with our "Global Settlement" with Sierra. (see
"Global Settlement`) The District is basically complete with this Docket.
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• Docket No. ER99-34-000: (Merger Filing). On April 14,1999 FERC approved
the Order Approving the Merger of Sierra Pacific Power Co. and Nevada
p,
Power. The Merger is conditioned upon divestiture of all generation owned
by the companies and upon joining an ISO within three years. On July 28,
1999 Sierra Pacific and Nevada Power completed their merger.
• Docket No. 98-7023: Filed July 23,1999: (MWISA Filing): Nevada Power
and Sierra Pacific are proposing an ISA (independent System Administrator)
as part of the Nevada Restructuring effort. I am following this closely to make
sure what are proposed does not adversely effecting the District. Currently
there is a filing pending FERC review. FERC has not acted on this filing yet.
Global Settlement: Global Stipulation and Agreement between Sierra
Pacific Power Company and Truckee Donner Public Utility District,
(signed 9113199)
Background Sierra and Truckee Donner are involved in a number of
proceedings before the FERC. These proceedings include Docket Nos. ER97-
3593-000 and ER97-4462-000 (Truckee Donner Network Service Agreement
proceedings), Docket Nos. EC99-1-000 et al. (Sierra Pacific and Nevada Power
Company merger and joint open-access transmission tariff); Docket Nos. ER98-
28-000, et al. (Alturas Project rating proceedings), Docket No. ER99-2332-000
(Generation Aggregation Tariff filing); Docket No. ER99-2339-000 (transmission
rate case); and Docket Nos. EC99-100 00 and ER99-3719-000 (Mountain West
'°. ISA filing). These proceedings are in different procedural stages. Some have
been settled with FERC orders issued approving the settlement, some are in
litigation, some have been partially settled, some have been approved by FERC
but are subject to rehearing and some are awaiting FERC action. After intensive
settlement negotiations, the Parties now have resolved all outstanding issues
between them and have entered into this Global Agreement which will resolve all
issues between them with respect to all of these dockets and establish a
framework for their dealings in the future.
If the Board has any questions regarding this agreement, I will discuss it with you
at the Board meeting.
WHAT'S NEXT.,
Now that we have secured transmission service, I will be working with the Westem Area
Power Administration (WAPA) to try to secure a long term partial allocation of energy at
below market prices. Stay tuned
8 9 FERC 9 61,15 6 Docket No.ER99-4455-000 -2-
UNITED STATES OF AMERICA capacity to incet Truckee Donner's request,then Sierra Pacific was required to file a new
FEDERAL ENERGY REGULATORY COMMISSION network service agreement with Truckee Donner providing for import capacity equal to
its load through 2027.
Before Commissioners: James J.1-Ioecker,Chairman; Subsequent to the filing of the settlement,the Nevada Commission approved the
Vicky A. Bailey,William L.Massey, construction of enough additional transmission capacity for Sierra Pacific to serve
Linda Breathitt,and Curt lfeherl,Jr. Truckee Donner's load through 2027. The proposed service agreement reflects the
additional capacity resulting front the Nevada Commission's order.
Sierra Pacific Power Company Docket No.ER99-4455-000 Notice of Filing,Inteiventiatts and Protests
Notice of Sierra Pacific's filing was published in the Federal Regis€er,64 Fed,
ORDER ACCEPTING NETWORK SERVICE AGREEMENT Reg.51,744(1999),with continents,protests,and interventions due on or before
October 5, 1999. On September 22, 1999,Truckee Donner filed a motion to intervene,
(issued November 10, 1999) which raised no substantive issues.
Oil September 15, 1999,Sierra Pacific Power Company(Sierra Pacific)filed a Oil October 5, 1999,the Public Utilities Commission of Nevada(Nevada
network service agreement that provides for Sierra Pacific to render network transmission Commission)filed a notice of intervention and motion for further procedures(October 5
service to the Truckee Donner Public Utility District(Truckee Donner)through 2027. lit Motion). The Nevada Commission expressed two concerns regarding the service
this order,we accept Sierra Pacific's network service agreement for filing. agreement:(1)Truckce Donner's projected load growth; and(2)whether Sierra Pacific
should be required to file a cost allocation and pricing proposal in conjunction with Elie
Rackground construction of additional facilities to serve Truckee Donner. 'rite Nevada Commission
also requests a technical conference be convened.
Pursuant to a settlement agreement approved in Docket No.ER97-3593-000,
et al.,'Sierra Pacific has filed a network set-vice agreement with Truckee Dormer, The Oil October 20, 1999,Sierra Pacific filed an answer to the Nevada Commission's
service agreement provides for Sierra Pacific to render network transmission service October 5 Motion. In its answer,Sierra Pacific states that Nevada Commission's
through 2027 and reflects Truckee Donner's current load ratio share allocation equal to concerns are misplaced because llte service agreement may be used only to serve Truckee
30 MW but projects its load will grow to 57 MW in 2027, Dormer's current load plus growth. Sierra Pacific also states that it intends to use rolled-
in pricing to allocate the costs of any additional facilities necessary to serve Truckee
In Sierra Pacific,the Commission approved a settlement which resolved a long- Donner,
standing dispute concerning Truckee Donner's request for import capacity front Sierra
Pacific equal to its load. Specifically,the settlement provided that,until the Atturas Also on October 20, 1999,Truckee Bonner filed a request for an extension of time
Intertic became operational,Truckee Donner would have 4 MW of import capacity on to respond to the October 5 Motion. Truckee Donner fuilier states that it is meeting with
Sierra Pacifies system. From the in-service date of the Alturas Intertie(December 1998) the Nevada Commission to address these concerts and expects to resolve tine dispute
through February 28,2001,'Truckee Donner would have first-in-time priority rights to shortly. On November 1, 1999,Truckee Donner fled a request for an additional
firth import capacity to serve its network load(projected to be 30 MW). 'rite settlement extension of tittle,until November 10, 1999 to respond to the October 5 Motion. Truckee
also required Sierra Pacific to submit an Integrated Resource Plan(IRP)to tine Nevada Donner states again that it is tweeting with the Nevada Commission and expects to resolve
Commission to inctude enough expansion capacity for Sierra Pacific to satisfy T'rrckee the Nevada Commission's concerns shortly.
Donner's request for network service through 2027. If the Nevada Commission approved
Sierra Pacific's IRP or revised it in such a way that it still provided enough import
'Sierra Pacific Power Cornpany(Sierra Pacific),87 FERC 161,066(1999).
Docket No. ER99-4455-000 3 Docket No.ER99-4455-000 4-
Discussion Commission tnay raise any concerns it may have regarding Sierra t'acific's cost allocation
and pricing proposal for additional network facilities when Sierra Pacific subirrits a
A. Procedure[Maftees section 205 filing to recover these casts.
Pursuant to Rule 214 of the Commission's Rules of Practice and Procedure,the Finally,fit light of our decision in this€natter,we will reject the Nevada
Nevada Commission's r€once s intervention make and tine Parties
t y,unopposed motion to Comrnissinn's request that we convene a technical conference. Siruilarly,we find that
intervene of Truckee Donner serve to make them parties to this Proceeding. Truckee Donner's requests for an extension of time to respond to the October 5 Motion
are moot.
B. Analysis
Accordingly,we will accept fire proposed agreement for filing,without suspension
Nevada Commission is concerned that: (1)tine service agreement could be read to or hearing.
extend Truckee Downer's allocation Of capacity beyond its native load requirements
because the IRP indicated that Truckee Donner would need oily 30 MW to serve its load, The Commission ordcrs:
net t}re projected 57 M W contemplated by the service agreement,and(2)the use of the
term"load"rather than"native load"in file service agreement may confer additional (A) Sierra Pacific's service agreement is hereby accepted for filing to become
rights to Truckee Donner not contemplated by the settlement. To file extent Truckee effective septenlber 15, 1999.
Dinner's load growth impacts the availability of capacity already reserved for Other
purposes,Nevada Car€€mission concludes that the service agreernerrt rnay be inteOusisfer€t
with Older No.888. (R) Sierra Pacific is hereby informed of tire rate schedule designations an the
attachment,
As noted by Sierra Pacific,the service agreement pratrdrs flat tine urspiut rapaa11% By tine Commission.
provided for tinder the agreement niay only be used fir supplt toild crnrrrrtlt -wF%Vd bt
Truckee Donner and its load growtit. We also note tfral rrcftsorl,%rrt 14;c rs prraru.r{l aIn ( s I:A}.)
the requirement that a utility will plan and construct its s� a
strn€It,sate thr it,ad of all
network customers arid,as a result,capacity wosrid be set aside for this propose.
Accordingly,we Find that Sierra Pacific has not allocated snore import capacity to
Truckee Donner than it is entitled to under Order No.888. Q-iood A,
Moreover,we will reject tile Nevada Comrission's request that Sierra Pacific Erc Acting Secretary.
directed to file a cost allocation and pricing proposal with the f:onunission in connection
with the construction of additional facilities to serve Truckee Donner. Tile Nevada
218 C.F.R.§385.214(1999).
31'101€1oting Wholesale Competition Through Open Access Non-Disc€inrinatory
Transruissiou Services by Public Utilities;Recovery of Stranded Costs by Public Utilities
and Transmitting Utilities,Order No.888,61 Fed, Reg.21,540(1996),FERC Staffs.
& Regs.T 31,036,(1996),order_„_,,.on re!!_'g,Order No.888-A,62 Fed,Rc& 12,274(1997),
FERC Slats.&Regs. 131,048(1997),order or,_,._.,,,relf'g,Order No.888-13,81 FERC
61,248(1997),order oft rel€'g,Order No, 888-C,82 FERC¶61,046(1998).
Sierra Pacific Power Company
Docket No. ER99-4455-000
Rate Schecluke_1)csii!rrations
D��t$Sl�t3� 1)escri�c�n,
(1) Service Agreement No, 54 Network Irttegraliorr Tr rnsrrtission
under FERC Electric`Fariff, Service Agreement with Truckee
Original Volume No.3 Donner Public 13tiliiy District
(Supersedes Service Agreement
No,21 under FERC Electric
Tariff,Original Volume No,3)
(2) Supplement No. I to Service Specificalions for Network
Agrcernent No.54 under IFF RC lrstef!ratics:t'1larrsanissina;Service
Electric Tariff,Original Volume
No. 3(Supersedes Supplement
No. I to Service Agreement
No, 21 under ITRC l lcctric
Tariff,Original Volimw No r)
(3) Suppiement No 2 to Scmicc NvI%%mk Oixo Ling,Agrcctncnt
Agicemew No 5-1 uudcr 1 1,RC
Electric larifl;()ri})ival Volume
No 3(Rcdcsignates Snpplrrucru
No. I to Service Agrccrimrl
No.21 under HJU 1:,lectric
"Tariff,Original Volume No.3)
(4) First Revised Sheet No, 167 Revised Index of Customers
under FERC Electric"Tariff,
Original Volume No. 3
(Supersedes Original Sheet
No. 167)
i
Page i ofs
Service Agreement For
Network Integration Transmission Service
1 . 0 This Service Agreement, dated as of September 13 , 1999, is
entered into, by and between Sierra Pacific Power Company
( "Transmission Provider" ) , and Truckee Donner Public Utility
District ("Network Customer" ) (collectively, the "Parties") .
2 . 0 The Network Customer has been determined by the Transmission
Provider to have a Completed Application for Network
Integration Transmission Service under the Transmission
Provider' s Open Access Transmission Tariff ("Tariff" ) .
3 . 0 The Network Customer has provided to the Transmission
Provider an Application Deposit in the amount of $45, 150 . 00,
in accordance with the provisions of Section 29 . 2 of the
Tariff .
4 . 0 Service under this Agreement shall commence on the later of
(1) September 15, 1999, or (2) such other date as it is
permitted to become effective by the Commission. A
Transmission Customer having point (s) of interconnection
with Transmission Provider ' s Transmission System shall be
a required to have a Network Operating Agreement in place
prior to commencement of transmission service hereunder.
Service under this Agreement shall terminate on December 31,
2027, unless the Transmission. Customer elects to terminate
this Agreement earlier as follows :
(a) If the Transmission Customer will take service
from an RTO or other independent entity that operates the
transmission facilities of the Transmission Provider, then
service under this Agreement may be terminated upon 60 days '
notice.
(b) If the Transmission Customer will not take service
from an RTO or other independent entity that operates the
transmission facilities of the Transmission Provider, then
service under this Agreement may be terminated upon three
years ' notice . In such event, the Transmission Provider may
seek to recover any stranded costs that it incurs in
accordance with Commission policy.
5 . 0 The Transmission Provider agrees to provide and the
Transmission Customer agrees to take and pay for Network
Integration Transmission Service in accordance with the
Provisions of Part III of the Tariff, this Service Agreement
Page
and the Network Operating Agreement as they may be amended
from time to time .
6 . 0 Any notice or request made to or by either Party regarding
this Service Agreement shall be made to the representative
of the other Party as indicated below.
Transmission Provider :
Executive Director, Transmission
Sierra Pacific Power Company
P.O. Sox 10100
Reno, Nevada 89520
Transmission Customer:
General Manager
Truckee Donner Public Utility District
P.O. Sox 309
Truckee, California 96160
7 . 0 The Tariff is incorporated herein and made a part hereof .
IN WITNESS WHEREOF, the Parties have caused this Service
Agreement to be executed by their respective authorized
officials .
Transmission Provider:
Name Title Date
Transmission Customer:
By:
Name Title bate
5 . 0 The Transmission Provider agrees to provide and the
<v; Transmission Customer agrees to take and pay for Net,,;ork
Integration Transmission Service in accordance with the
Provisions of Part III of the Tariff, this Service Agreement
and the Network Operating Agreement as they may be amended
from time to time .
6 . 0 Any notice or request made to or by either Party regarding
this Service Agreement shall be made to the representative
of the other Party as indicated below.
Transmission Provider :
Executive Director, Transmission
Sierra Pacific Power Company
P.O. Box 10100
Reno, Nevada 89520
Transmission Customer:
General Manager
Truckee Donner Public Utility District
P.O. Box 309
Truckee, California 96160
g 7 . 0 The Tariff is incorporated herein and made a
part hereof . .
IN WITNESS WHEREOF, the Parties have caused this Service
Agreement to be executed by their respective authorized
officials .
Transmission Provider:
By:
Name Title Date
Transmission Customer:
Nam Title Date
Page 3 of 9
SPECIFICATIONS FOR NETWORK INTEGRATION TRANSMISSION SERVICE
1 . 0 Term of Network Service:
Start Date: September 15, 1999
Termination Date : December 31, 2027
This Service Agreement supersedes an Unexecuted Service
Agreement filed July 2, 1997 and given an effective date of
July 1, 1997, which provided that it would terminate two
business days after the date of execution of a network
service agreement .
2 . 0 Description of capacity anal/or energy to be transmitted by
Transmission Provider across the Transmission Provider ' s
Transmission System (including electric control area in
which the transaction originates) :
(a) As described in Section 3 . 0 below, Transmission
Customer ' s requirements (Network Load plus losses) are
currently met through a firth purchase from Idaho Power
Company (IPC) that will remain in effect through December
31, 2001 . Thus, during that term, the Transmission
Customer' s firm resources will originate in the IPC Control
Area and be transmitted across the Transmission Provider ' s
Transmission System from the Midpoint interface (Point of
Receipt) to the Transmission Customer ' s Points of Delivery.
During that term, the Transmission Customer may also
designate energy and capacity from IPC' s share of the North
Valmy Generating Station located inside the Transmission
Provider ' s Control Area.
(b) The Transmission Customer may, in accordance with the
Tariff, submit a request to change its designation of Points
of Receipt, to be effective after December 31, 2001 . In
such event, the Transmission Customer' s right to import
power from outside of the Transmission Provider' s Control
Area may be restricted as follows :
(1) If the Transmission Customer wishes to shift all of its
imports to the Summit interface or the Gonder interface,
then the total amount of power that may be imported through
that Paint of Receipt in any hour shall be limited to 70% of
the Transmission Customer' s load in that hour for imports
through Summit and 504 of the Transmission Customer' s load
in that hour for imports through Gonder.
Page 4 of8
(2) If the Transmission. Customer wishes to shift some of its
imports to the Summit interface or the Gonder interface,
then the Transmission Customer ' s total right to import power
in that hour shall be reduced by 0 .3 MW for each MW imported
through Summit and 0 .5 MW for each MW imported through
Gonder, rounded to the nearest MW.
(3) The following examples are intended to clarify
calculation of the reductions provided for in paragraphs (1)
and (2) above .
(i) If the Transmission Customer wishes to utilize the
Summit interface for all of its imports, if its load in a
particular hour is 30 MW, it may import 21 MW through
Summit, and must meet the remaining 9 MW of its load either
with resources located inside the Transmission. Provider' s
Control. Area and/or by satisfying any requirements for
obtaining additional import rights outside of this
Agreement .
(ii) If the Transmission Customer has a load of 30 MW in
a particular hour and wishes to import 3 MW through Summit,
its total import capacity for that hour is reduced by 1 MW
to 29 MW, and the Transmission Customer must meet the
remaining 1 MW of its load either with resources located
inside the Transmission Provider' s Control Area and/or by
satisfying any requirements for obtaining additional import
rights outside of this Agreement .
(4) If the Transmission Customer retains the Midpoint
interface as its Point of Receipt (whether or not it
designates one or more new Network Resources) or if it
designates a new Point of Receipt at the Alturas interface
or designates any combination of the Midpoint and Alturas
interfaces as the Points of Receipt, Transmission Customer' s
right to import capacity for its entire Network Load plus
losses under this Agreement (subject only to the limitations
set forth in paragraphs (c) and (d) below) shall not be
affected.
(5) The Transmission Provider shall redetermine and file at
the Commission the reductions provided for in this Section
2 (b) subsequent to each major transmission expansion that it
places in service, including a determination of any
restrictions that should apply at any new Point of Receipt
created by the transmission expansion. The Transmission
Provider shall discuss such new determinations with the
Transmission Customer prior to filing them at the
Commission.
(c) Notwithstanding anything else in the Tariff or this
Agreement, the Transmission Customer ' s right to import power
Page 5 of 8
into the Transmission Customer ' s Control Area under the
terms of this Agreement shall not exceed the amounts shown
in Appendix A to this Agreement,PP g plus losses . To the extent
that the Transmission Customer ' s Network Load at any time
exceeds the amounts shown in Appendix A for the applicable .
year, the Transmission Customer must meet the remainder of
its load either with resources located inside the
Transmission Provider ' s Control Area and/or by satisfying
any requirements for obtaining additional import rights
outside of this Agreement .
(d) Notwithstanding anything else in the Tariff or this
Agreement, the import capacity provided for in this
Agreement may be used only to supply .load currently served
by the Transmission Customer and the Transmission Customer ' s
load growth, including loads in the general vicinity of the
Transmission Customer' s load as of the date of this
Agreement but which are not currently being served by the
Transmission Customer. To the extent that the Transmission
Customer commences serving new loads that are not in the
general vicinity of the Transmission Customer ' s load as of
the date of this Agreement, the Transmission Customer must
satisfy the new load either with resources located inside
the Transmission. Provider' s Control Area or by satisfying
any requirements for obtaining additional import rights
outside of this Agreement .
r`
(e) Non-firm energy will be transmitted on a non-firm basis
across the Transmission Provider ' s Transmission System as
available when requested by the Transmission Customer.
(f) The limitations expressed in this Section 2 .0 relate
solely to Transmission Customer' s rights to import capacity.
As provided in Section 4 . 0 below, this Agreement fully
covers network service within the Transmission Provider' s
system for Transmission Customer' s entire Network Load,
including all load growth.
3 .0 Network Resources
(1) Transmission Customer Generation Owned: None
(2) Transmission Customer Generation Purchased:
Total
Source Capacity
IPC Resources originating in the IPC
Control Area through 12/31/01, and See Section 2 . 0
thereafter in accordance with Section above
2 . 0 above
Page 6 of 8
TPC' s Share of the Valmy Generating
z9P. Station located within the Transmission See Section 2 . 0
Provider ' s Control Area through above
12/31/01, and thereafter in accordance
with Section 2 . 0 above
Other non-firm, resources
See Section 2 . 0
above
(3) Total Network Resources : (1) + (2) _ Network Load plus
losses
4 . 0 Network Load
(1) Transmission Customer Network Load: Transmission
Customer' s network load measured at the Point (s) of Delivery
is its full load requirement as it changes from time to
time, including load growth. Transmission Customer ' s most
recent peak loads (measured at the Point (s) of Delivery)
were 28 . 8 MW winter (1998) and 18 .7 MW summer (1999) ,
Transmission Customer' s projected 2000 maximum demand is
30 .22 MW (December 2000) . Transmission Customer receives
service at the following Points of Delivery:
Percent of Total
Load Served Distribution Voltage Transmission
-�.. Level
Volta e Level
25 .4°6
Truckee 60 kv
32 . % Donner Lake 60 kv
.7g 26 .4% Maros Valley 120 kv* Tahoe Donner 60 kv
4 .3% Glenshire 14 .4 kv
*Martis Valley shall be treated as transmission voltage for
purposes of monthly billing settlement .
The load at each of Transmission Customer ' s substations can
be transferred to other substations; therefore, load
projections are for the Transmission Customer's entire
system.
(2) Member System Loads Designated as Network Load: None
(3) Total Network Load measured at the Point (s) of
Delivery. (1) + (2) = 30, 220 (projected 2000 winter peak)
5 . 0 Designation of party subject to reciprocal service
obligation:
Idaho Power Company
Truckee Donner Public Utility District
a
}
Page 7 of8
6 . 0 Service under this Agreement may be subject to some
combination of the charges detailed below.
ropri
charges for individual transactions will beThdete emi ed ate inaccordance with the terms and conditions of the Tariff . )
(1) Load Ratio Share of Annual Transmission Revenue
Requirement for Zone A per Attachment H of the Tariff .
(2) Facilities Study Charge: N/A
(3) Direct Assignment Facilities Charge : N/A
(4) Ancillary Services : Ancillary Services may be self-
supplied as provided in the Tariff .
(a) Scheduling System, Control and Dispatch Service :
Per Schedule 1 of the Tariff (Zone A) .
(b) Reactive Supply and Voltage Control from
Generation Service : Per Schedule 2 of the Tariff
(Zone A) .
(c) Regulation and Frequency Response Service : Per
Schedule 3 of the Tariff (Zone A) .
(d) Energy Imbalance Service: Per Schedule 4 of the
Tariff (Zone A) .
(e) Operating Reserve - Spinning Reserve Service :
Obtained from IPC under IPC-TDPUD Sale and
Purchase Agreement .
(f) Operating Reserve - Supplemental Reserve Service :
Obtained from IPC under IPC--TDPUD Sale and
Purchase Agreement .
( } Redispatch Charges : Pursuant to the Tariff and as
implemented by the Network Operating Group.
(6) Power Factor Requirements : Per Schedule 2 of the Tariff
(Zone A) .
7 . 0 Notwithstanding any contrary provision in the Tariff or in
this Agreement, Transmission Provider ' s rights to file under
Section 205 or Section 206 of the Federal Power Act to
change the rates, terms and conditions of Network
Integration Transmission Service to Transmission Customer
(including provisions of the Tariff, this Agreement, or the
concurrently executed Network Operating Agreement) shall not
extend to any changes that would have the effect, directly
or indirectly, of imposing on Transmission Customer (a) any
(
k
2
Page 8 of
i' obligation to obtain and/or pay for Firm Transmission Rights
(or similar mechanisms) provided for in the Mountain West
ISA Tariff or the tariff of any superseding ISO, RTO or
similar entity with respect to the import capacity provided
for in this Agreement, (b) any charges for assigned
facilities (distribution or otherwise) currently in
existence and currently being used to serve the Transmission
Customer, or (c) any charges or costs prohibited by the
Commission' s Order in Docket No. EC99-1-000 . Transmission
Customer preserves its rights under Section 206 of the
Federal Power Act .
8 . 0 This Agreement and all of the provisions hereof shall be
binding on and shall inure to the benefit of the Parties
hereto and their respective successors and permitted
assigns . This Agreement may not be assigned without the
express written consent of the other Party, except as to a
successor in the operations of its properties by reason of
merger, consolidation, sale or foreclosure where
substantially all such properties (or in the case of the
Transmission Provider substantially all of the Transmission
Provider ' s transmission properties) are acquired by such
successor.
9 • 0 This Agreement may be executed in any number of
counterparts, and each counterpart shall for all purposes be
an original, and all such counterparts shall together
constitute one and the same Agreement .
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Appendix A
Truckee Donner Public Utility District
Annual Peaks (KW) - Forecast:
Annual Annual
Peak Peak+
Year (KW) 10%(KW)
1999 29,628 32,590
2000 30,220 33,242
2001 30,824 33,907
2002 31,441 34,585
2003 32,070 35,277
2004 32,711 35,982
2005 33,365 36,702
2006 34,033 37,436
2007 34,713 38,185
2008 35,408 38,948
2009 36,116 39,727
2010 36,838 40,522
2011 37,575 41,332
2012 38,326 42,159
2013 39,093 43,002
2014 39,875 43,862
2015 40,672 44,739
2016 41,486 45,634
2017 42,315 46,547
2018 43,162 47,478
2019 44,025 48,427
2020 44,905 49,396
2021 45,804 50,384
2022 46,720 51,392
2023 47,654 62,419
2024 48,607 53,468
2025 49,579 54,537
2026 50,571 55,628
2027 51,582 56,740
As provided in Section 2.0 (c), the Annual Maximum Import Rights(MW)
will be the "Annual Peak +10% (KW)" plus the "Transmission Loss Factor,-
as filed with and approved by FERC and the total is rounded to nearest MW.
x
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Y
F
f
Revised 9/14199
AnnuaiforecastMPUD.As
i
GLOBAL STIPULATION AND AGREEMENT
BETWEEN SIERRA PACIFIC POWER COMPA_Nl y
AND TRUCKEE DONNER PUBLIC UTILITY DISTRICT
This Global Stipulation and Agreement(the "Global Agreement"),
dated this 13th day of September, 1999, is made and entered into by and between
Sierra Pacific Power Company ("Sierra"), and the Truckee Donner Public Utility
District ("Truckee Donner") (collectively the "Parties" and individually a "Pasty").
The Global Agreement is intended to resolve a number of outstanding issues between
the Parties that have arisen in a variety of proceedings.
BACKGROUND OF THE GLOBAL AGREEMENT
Sierra and Truckee Donner are involved in a number of proceedings
before the Federal Energy Regulatory Commission ("FERC" or the "Commission").
These proceedings include Docket Nos. ER97-3593-000 and ER97-4462-000
(Truckee Donner Network Service Agreement proceedings); Docket Nos. EC99-1-
000, et al. and ER99-34-000 (Sierra Pacific and Nevada Power Company merger and
joint open-access transmission tariff); Docket Nos. ER98-28-000, et al. (Alturas
Project rating proceedings); Docket No. ER99-2332-000 (GT fling); Docket No.
ER99-2339-000 (current transmission rate case); and Docket Nos. EC99-I00-000
and ER99-3719-000 (Mountain West ISA filings). These proceedings are in differ-
ent procedural stages. Some have been settled with FERC orders issued approving p
the settlement, some are in litigation, some have been partially settled, some have
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been approved by the FERC but are subject to rehearing and some are awaiting
FERC action. After intensive settlement negotiations, the Parties now have resolved
all outstanding issues between them and desire to enter into this Global Agreement
which will resolve all issues between them with respect to all of these dockets and
establish a framework for their dealings in the future.
THEREFORE, in consideration of the covenants and agreements
contained herein, together with other good and valuable consideration, the receipt
and sufficiency of which is hereby mutually acknowledged, the parties do mutually
covenant and agree as follows:
ARTICLE 1
DEFINITIONS
Capitalized terms used herein shall have the meaning set forth below:
"Effective Date" shall mean the date that this Global Agreement is
duly executed by each Party.
"Transmission Service Contract" shall mean those currently effective
transmission service contracts between Sierra and Truckee Donner for the provision
of transmission service on file at the Commission, and any such successor contracts
to be negotiated and executed by the Parties as described in Article 2.5.
ARTICLE 2
RESOLUTION OF ISSUES
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The Parties agree to settle their pending disputes in the following
proceedings in accordance with the following principles, each of which is an integral
part of the Parties'settlement in principle. This Global Settlement provides for the
resolution of these issues as follows:
2.1 Mer er Proceedin s. Truckee Donner will not file a petition
for review of the FERC order approving the merger of Sierra and Nevada Power
Company in Docket No. EC99-1-000, et al.
2.2 GT Proceedin s. Truckee Donner will not oppose Sierra's
motion for expedited approval of the Generation Tariff("GT") that Sierra filed on
March 31, 1999 in FERC Docket No. ER99-2332-000. Truckee Donner may take
any position (or no position) with respect to the proposed GT amendment that Sierra
will file, subsequent to approval of the current filing, to modify the GT to be consis-
tent with the Public Utility Commission of Nevada("PUCN") Staffs proposal.
2.3 Alturas Rgq Proceedings. If Sierra is able to reach a
settlement with the remaining participants in Docket Nos. ER99-28-000, et al. that is
substantially similar to Sierra's Offer of Settlement dated July 26, 1999, or is
otherwise able to reach agreement with the other participants in a manner that does
not adversely affect Truckee Donner's access to import capacity (beyond any such
effect that might result from the July 26 Settlement Offer if Truckee Donner were to
opt to utilize the Alturas intertie as the primary point of receipt under the Transmis-
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sion Service Contract(s) provided for under Article 2.5) or that is otherwise accept-
able to Truckee Donner, Truckee Donner will support FERC approval of such
settlement. If no settlement is reached in that proceeding, Truckee Donner will file
briefs (and at its option may also sponsor a witness) in support of the position
(currently espoused by Sierra) that firm use of the Alturas line by Sierra, Bonneville
Power Administration ("BPA"), and other non-California parties should not be
limited, as proposed by the California parties, based on the California parties'
historical use of or other claim of non-contractual rights to use facilities intercon-
nected to the Alturas line; rather, use of the Alturas line as well as use of intercon-
necting facilities (including the Northwest Intertie, which is necessary to complete
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imports from the Pacific Northwest) should be allocated according to firm contracts
and point-to-point reservations as provided for in Order No. 888 and applicable
transmission tariffs thereunder.
2.4 Mountain VISA Filing. Truckee Donner's position in
FERC Docket No. ER99-3719-000 shall be generally supportive of the Mountain
West Independent Scheduling Administrator's ("ISA") filing, although Truckee
Donner need not actively support aspects of the filing other than Appendix E.
Truckee Donner reserves its right to raise challenges on specific issues in the future if
Appendix E is modified so as to require Truckee Donner to purchase Firm Transmis-
sion Rights ("FTR") for import capacity
p p y provided for under the Transmission Service
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Contracts provided for pursuant to Article 2.5 below. Sierra and Truckee Donner
shall both actively support FERC's approval without modification of Appendix E.
Further, in any proceeding in which any person challenges treatment of the Trans-
mission Service Contract described in Article 2.5, below, as a grandfathered contract
under Appendix E(whether in Docket No. ER99-3719-000 or any other proceeding
initiated before FERC, a court, or through alternative dispute resolution mecha-
nisms), Sierra and Truckee Donner shall actively oppose any attempts by other
parties to challenge such treatment.
2.5 Transmission Service Contract Continuation.
(a) Truckee Donner and Sierra will execute and file with FERC
in Docket No. ER97-3593-001 by September 17, 1999, the Network Service Agree-
anent("NSA") attached hereto.
(b) Sierra and Truckee Donner will negotiate and execute
modifications to the NSA appropriate to facilitate integration of the NSA into the
operations of the ISA, and which will go into effect upon operation of the ISA. The
modified NSA will be filed at FERC subsequent to FERC's acceptance of the NSA.
The modifications shall implement the following general principles:
(1) Sierra's obligation to operate, plan and expand its system on Truckee
Donner's behalf shall be the same as its obligations under Section C.2.1. of
Appendix C of the Mountain West ISA Tariff and Section 10.1 of the TO
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Tariff. Sierra also shall continue to have the obligation to provide the same
service to Truckee Donner that it would have to serve any Native Load
customer, including customers Sierra serves as a provider of last resort.
(2) In lieu of a network service charge, each month Truckee Donner will pay
a sum determined by multiplying the Zone A Grid Access Charge(as it is
then currently in effect pursuant to Schedule A of the TO Tariff or any
superseding schedule) by Truckee Donner's load, measured in KW, at the
time of Sierra's (i.e. the Zone A) Transmission System Peak. If the zonal
rate structure is abandoned, Truckee Donner's charges shall be based on the
blended Grid Access Charge applicable to load located in Sierra's control
a'
area. The Iimits set forth in Section 7.0 of the Specifications for Network
Service included as part of the attached NSA shall continue in application
unaffected by the substitution of such Grid Access Charges for network
service charges.
(3) Truckee Donner's ancillary services obligations, and its rights to select
the means for satisfying those obligations, shall be grandfathered under the
ISA, and Truckee Donner will therefore not be obligated to comply with any
ISA ancillary services requirements that differ from the current requirements
under the merger GATT. Truckee Donner may, however, avail itself of
additional opportunities/sources for Truckee Donner to obtain at competitive
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rates arising as a result of operation of the ISA those ancillary services
permitted by the OATT to be self-provided. If Sierra is obligated to purchase
ancillary services in order to provide them to Truckee Donner, Sierra will be
reimbursed the direct costs (without markup) Sierra incurs for the acquisition
of such service(s).
(4) The notice provisions for changes in Points of Receipt shall be revised to
be consistent with the F'TR auction procedures.
These modifications will be subject to further change to tape into account differences
between the ISA tariff as filed and as ultimately approved. Additional modifications
will be negotiated to the extent necessary to integrate the NSA into the operations of
the ISA. If the Parties cannot agree on such additional modifications to be made,
then Truckee Donner will continue to take service pursuant to the NSA, modified
only as specified in paragraphs I through 4 above.
2.6 Current Transmission Rate Filing. As part of this Global
Agreement, the Parties have agreed to a Settlement Agreement to be filed in Docket
No. ER99-2339-000 (the Transmission Rate Settlement). The parties shall execute
and file the Transmission Rate Settlement substantially in the form and substance of
the draft attached hereto.
2.7 Future Transmission Rate Filings.
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(a) Except as provided in paragraph (b) below and in the Transmission Rate
Settlement, Truckee Donner reserves its rights to challenge any component of ATRR
(including without limitation return on equity and merger-related costs) and to assert
any other claim regarding development of the appropriate transmission rates.
(b) Truckee Donner may not assert the following claims in Sierra's next
general transmission rate case (including in any rate case filed in connection with a
proposed new RTO or merger) unless that rate case is filed more than five years after
the Effective Date-
(1) loads associated with transmission by Idaho Power Company and
Mt. Wheeler Power Inc. should be included in the denominator for purposes
of calculating transmission rates and load ratio share, and
(ii) a single, blended rate for the merged company should replace the
current zonal rate structure,
2.8 Future RTO Filings. Any opposition raised by Truckee
Donner to any Regional Transmission Organization ("RTO") filings made in the first
ten years following the Effective Date and in which Sierra is a participant shall be
limited to the following issues:
(a) The impact of the RTO on Truckee Donner's rights to transmission
service as provided in Section 2.5 of this Global Agreement.
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(b) The impact of the RTO on transmission constraints that would impair
Truckee Dormer's ability to exercise its rights to transmission service as
provided in Section 2.5 of this Global Agreement.
(c) The impact of the RTO on the rates and charges for transmission service
and/or ancillary services paid by Truckee Donner, including the proposed rate
treatment for network upgrades.
(d) The opportunity provided to Truckee Donner to participate in any stake-
holder process that is conducted with respect to the formation of the RTO,
provided that Truckee Donner may not oppose the fact that no stakeholder
process at all was conducted.
(e) The treatment of any facilities owned or directly paid for by Truckee
Donner.
(f) Truckee Donner's ability to convert service under the Transmission.
Service Contract provided for pursuant to,Section 2.5 to service under the
RTO.
(g) The extent to which the RTO permits rate pancaking.
2.9 Future Merger„Filings. Any opposition raised by Truckee
Donner to any merger filings made in the first ten years following the Effective Date
and in which Sierra is a participant shall be limited to the following issues:
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(a) The impact of the merger on Truckee Donner's rights to transmission
service as provided in Section 2.5 of this Global Agreement.
(b) The impact of the merger on transmission constraints that would impair
Truckee Donner's ability to exercise its rights to transmission service as
provided in Section 2.5 of this Global Agreement.
(c) The impact of the merger on the rates and charges for transmission
service and/or ancillary services paid by Truckee Donner.
(d) The extent to which the merger permits rate pancaking.
(e) The impact of the merger on competition in any market with which
Truckee Donner, Sierra or Nevada Power Company is directly intercon-
nected, including Sierra's control area.
The foregoing limitations shall not apply with respect to, and Truckee Donner may
make any arguments in opposition to, any proceeding involving a proposed merger
between Sierra and one or more of Truckee Donner's then-current suppliers under its
long-term firm power purchase contracts.
2.10 Related Commission Approvals. If FERC does not approve
without modification the Transmission Rate Settlement, the NSA, and/or the Parties'
agreed-upon ISA-related modifications thereto, then the Parities shall in good faith
negotiate modifications acceptable to the FERC that restore the originally intended
benefits and burdens of the Settlement Agreement.
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ARTICLE 3
NATURE OF SETTLEMENT
The Parties agree that, except as expressly provided for in this Global
Agreement and the Transmission Settlement Agreement, upon and after the Effective
Date, the Global Agreement and the Transmission Settlement Agreement shall
operate as a full and final settlement, release, acquittance, discharge, accord and
satisfaction of all issues, disputes, claims, demands, liabilities, rights and/or obliga-
tions related to or arising out of Docket Nos. ER97-3593-000, ER97-4462-000,
EC99-1-000, et al., ER99-2332-000, ER99-28-000, et al., ER99-2339-000, ER99-34-
000, EC99-100-000 and ER99-3719-000 consistent with the retention of all argu-
ments provided for herein for the future.
ARTICLE 4
COVENANTS
Each of the Parties hereby agrees to cooperate with and support, and
not to take actions inconsistent with this Global Agreement. No Party shall, in the
future,take any actions that are inconsistent with the provisions of this Global
Agreement.
ARTICLE 5
CONDITIONS PRECEDENT
Other than execution of this Global Agreement by the Parties, there
are no conditions precedent. The Parties agree that this Global Agreement is not
it
required to be filed with the Commission nor does it require Commission approval to
become effective.
ARTICLE 6
MISCELLANEOUS
6.1 Entire Agreement. This Global Agreement and the Trans-
mission Rate Settlement, constitute the entire agreement among the Parties with
respect to the subject matters addressed herein, and supersede any and all prior or
contemporaneous representations, agreements, instruments and understandings
between them, whether written or oral. There are no other oral understandings, terms
or conditions, and none of the Parties has relied upon any representation, express or
implied, not contained in this Global Agreement and/or the Transmission Rate
Settlement.
6.2 Amendments. No change, amendment or modification of this
Global Agreement shall be valid or binding upon the Parties hereto unless such
change, amendment or modification shall be in writing and duly executed by both
Parties hereto.
6.3 Notices. All notices provided for in this Global Agreement
shall be in writing, delivered in person or by United States Mail, or by telex, telecopy
or other similar means, and shall be considered duly delivered upon receipt at the
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addresses below or at such other addresses as may hereafter be furnished by one
Party in writing to the ether Party:
Sierra Pacific Power Com an
Executive Director, Transmission
Sierra Pacific Power Company
6100 Neil Road
Post Office Box 10100
Reno, Nevada 89520
Truckee Donner Public Utility District_
General Manager
Truckee Donner
Public Utility District
P.O. Box 309
Truckee, CA 96160
6.4 No Waiver. Any failure of any Party (i) to enforce any of the
provisions of this Global Agreement or(ii) to require compliance with any of its
terms shall in no way affect the validity of this Global Agreement, or any part hereof,
and shall not be deemed a waiver of the right of such Party thereafter to enforce any
and each such provision.
6.5 Governing Law. This Global Agreement shall be deemed to
be a Nevada contract and shall be construed in accordance with and governed by the
laws of the State of Nevada without regard to its conflicts of law provisions.
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6.6 Counter arts. This Global Agreement may be executed in
any number of counterparts, and each counterpart shall for all purposes be an
original, and all such counterparts shall together constitute one and the same Global
Agreement_
6.7 Successors and Assigns. This Agreement and all of the
provisions hereof shall be binding on and shall inure to the benefit of the Parties
hereto and their respective successors and permitted assigns. This Agreement may
not be assigned without the express written consent of the other Party, except as to a
successor in the operations of its properties by reason of merger, consolidation, sale
or foreclosure where substantially all such properties (or in the case of Sierra
substantially all of Sierra's transmission properties) are acquired by such successor.
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IN WITNESS WHEREOF, the Parties have executed this Global
Agreement by their respective duly authorized officers or representatives as of the
day and year above written.
Sierra Pacific Power Company
cA "S-�-"
By: ___--
Title: 45,<:,G l.1�12ffcr� /YZ/�.v�.r�t 55�0.✓
Truckee Donner Public Utility District
By:
Title:
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IN WITNESS WHEREOF, the Parties have executed this Global
Agreement by their respective duly authorized officers or representatives as of the
day and year above written.
Sierra Pacific Power Company
By:
Title:
Truckee Donner Public Utility District
)Yl�
By:
Title:
15
Comparison of Costs as:
Full Requirements vs, Current Market Based Rates
(Using Year 2000 Forecasted Loads)
yA"` °�i",A 4 b � A � '• w.^ � � �y.V �.' -.. Jr w:y b`' _ ,+' t" t a S
...
. . �storica� i Fall
.. J r ,� � . �� � Sierra Pacific
��:�° ``�� JJ Re uirements Customer
r � aJ Year 2000 Power Supply Budget at,Market Based Rates
$8,000,000 w JJJ fi
t�55
ti r r "„r �w _ �, r+. r�"*J J w a l w" - -•a hr "4`"*''�'
$ 000 000
bw X
Qyy�� //��((�� //'��..ff�� 'fib 1`� i��✓.yyam�y4 y ��- .'a Tc`h'""�ti�,,."'x�..a13'+^„y°,e'"y.No-"
$V,000,000
OR
$5,000 000 �
» wwy,� �r r 9✓ ^.r r rd�' J
w�.�,.�'�"J *• w w r tip, ��?- � ,��, .r `w.�. � ,� " J - J
$4 000 000
3
,000,000
$2,000 000
$1,0001000-
$0.
Total Power Supply Cost s