During the BP-22 rate period, power and/or transmission rates may be adjusted each fiscal year in accordance with the respective CRAC, RDC, or FRP Surcharge provisions. For more details, see sections II.O, II.P and II.Q in the Power General Rate Schedule Provisions and sections II.G, II.H and II.I in the Transmission General Rate Schedule Provisions.
FY 2023 Power Reserves Distribution Clause
The Power RDC triggered based on FY 2023 end-of-year financial results resulting in a Power RDC Amount of $285.4 million. Please see the Administrator’s letter (Dec 22, 2023) regarding the Power RDC final decision.
The Administrator has determined the Power RDC Amount will be used for the following purposes:
- $165.4 million as a Power dividend distribution (rate credit).
- $90 million as flexible debt reduction; and
- $30 million designated as Reserves Not for Risk for accelerated fish and wildlife mitigation.
Power Dividend Distribution: The FY 2024 non-Slice rate credit is $4.34 per megawatt-hour for the last 10 months of the fiscal year (equivalent to an annual reduction of $3.64 per megawatt-hour). This would reduce the average non-Slice rate by 10.20% compared to the BP-24 Final Proposal. The Power DD credit rate is calculated in accordance with the BP-24 Power Rate Schedules and General Rate Schedule Provisions (GRSP section II.P.2) and would be used to bill PF and IP customers. The rate would also adjust the Dec. 2023 – Sept. 2024 PF Tier 1 Equivalent energy rates.
FY 2023 Transmission Reserves Distribution Clause
The Transmission RDC triggered based on FY 2023 end-of-year financial results resulting in a Transmission RDC Amount of $130.4 million. Please see the Administrator’s letter (Dec 22, 2023) regarding the Transmission RDC final decision.
The Administrator has determined the Transmission RDC Amount will be used for the following purposes:
- $50.4 million will be held as reserves for risk to reflect cost pressures that were not included in the BP-24 IPR process; and
- $80 million will be used for flexible debt reduction.
FY 2022 Power Reserves Distribution Clause
Based on the amount of financial reserves available for risk that were attributed to Power Services and BPA at the end of FY 2022, the Power RDC “triggered” resulting in a Power RDC Amount of $500 million, the specified cap. The Administrator determined the Power RDC Amount will be used for the following purposes:
- $350 million for a Power Dividend Distribution (a Power rate credit that is applied to Dec. 2022 through Sept. 2023 customer bills);
- $100 million for debt reduction or revenue financing in FY 2023, with any amount not used to reduce debt or revenue finance left as financial reserves to support BPA's liquidity and/or increase the probability of a 2023 Power RDC Amount; and
- $50 million to address, on an accelerated, one-time basis, certain non-recurring maintenance needs of existing fish and wildlife mitigation assets that (i) BPA anticipates would otherwise need to be addressed during future rate periods and (ii) will result in avoidance of those costs in future rate periods. For purposes of this section, mitigation assets are those BPA determines that (a) have resulted in tangible and measurable benefits or improvements for fish and wildlife, and (b) are directly related to mitigating for the effects of the construction or ongoing operation of Federal Columbia River Power System (FCRPS) projects.
Power Dividend Distribution: The FY 2023 non-Slice rate credit is $9.60 per megawatt-hour for the last 10 months of the fiscal year (equivalent to an annual reduction of $7.92 per megawatt-hour). This results in a reduction of the average non-Slice rate by 22.2% compared to the BP-22 Final Proposal. The Power DD credit rate is calculated in accordance with the BP-22 Power Rate Schedules and General Rate Schedule Provisions (GRSP section II.P.2) and is used to bill PF and IP customers. The rate also adjusts the December 2022 – September 2023 PF Tier 1 Equivalent energy rates.
FY 2022 Transmission Reserves Distribution Clause
Based on the amount of financial reserves available for risk that were attributed to Transmission Services and BPA at the end of FY 2022, the Transmission RDC triggered resulting in a Transmission RDC Amount of $63.1 million. The Administrator has determined that:
- $16.4 million will be used to hold BP-24 transmission rates at the levels adopted in the BP 22 rate proceeding;
- $12.9 million will reduce transmission rates through a Transmission Dividend Distribution (DD) which results in a credit that is applied to December 2022 through September 2023 customer bills; and
- $33.8 million will cover Transmission’s forecast cost increases in FY 2023.
Transmission Dividend Distribution: The FY 2023 Transmission DD credit percentage is 1.46%. This is calculated in accordance with the 2022 Transmission, Ancillary, and Control Area Service Rate Schedules and General Rate Schedule Provisions (GRSP Section II.H.1.b) by dividing the Transmission DD Amount by the sum of the Dec. to Sept. revenue forecast for FY 2023.
Revised rates are calculated by subtracting the Transmission DD Credit Percentage from 1.0, and then multiplying by the applicable rates. These revised rates will be used to bill service at the following rates: NT-22, PTP-22, FPT-22.1, IS-22, SCD rate (ACS-22), Utility Delivery rate (GRSP Section II.A.1.b), and IM-22.
