The Bonneville Power Administration (BPA) on March 4 said that it and its long-term transmission customers have successfully negotiated a settlement agreement to implement a new open access transmission tariff, which will go into effect on Oct. 1, and defines the terms and conditions of services, products, and network integration offered by BPA.
“This settlement resulted from a collaborative effort and provides BPA the ability to align its business processes with current and emerging industry standards,” BPA Administrator Elliot Mainzer, who signed the record of decision that adopted both the settlement and new tariff, said in the statement. “Our customers’ willingness to partner with us and negotiate solutions to complex issues has resulted in a sustainable path forward for BPA to the benefit of our customers and the region.”
BPA said that one of the key changes in the new tariff is the removal of the requirement to submit all changes to FERC for review and approval. BPA said that due to differences between a typical FERC-jurisdictional utility and the unique nature and mission of the federal power marketing agency, BPA was unable to get needed changes and updates to its tariff approved through FERC. BPA noted that in fall 2016, it notified the region that the process to change its existing tariff was no longer a tenable approach. BPA added that achieving the goals of its 2018-2023 Strategic Plan requires tariff modernization.
BPA noted that it announced its decision to conduct a hearing under Section 212 of the Federal Power Act to develop a new tariff and launched a series of workshops in April 2018 to solicit customer feedback on its proposed tariff changes. BPA added that from September to November 2018, it and its long-term transmission customers met 22 times to negotiate the terms of a settlement agreement on the tariff.
Under the terms of the settlement, BPA said, all of its long-term transmission customers have agreed to transition their existing contracts to the new tariff as of Oct. 1. BPA noted that while not generally under the jurisdiction of FERC, it remains committed to aligning its tariff with FERC’s pro forma tariff and the best practices of the utility industry. BPA said that it and its customers plan to conduct regular proceedings, concurrent with BPA rate cases, to continue to amend and modernize the agency’s tariff.
Among other things, the settlement agreement noted that BPA will only offer hourly firm transmission service based on available transfer capability (ATC) that is calculated in accordance with BPA’s short-term ATC methodology. BPA will begin limiting the hourly firm product starting July 1. The settlement agreement added that hourly firm reservations will not be available in real-time starting Jan. 1, 2020.
Also, by Oct. 1, 2021, BPA will use reasonable efforts to develop an accurate and transparent short-term ATC methodology. In that process, the settlement agreement added, BPA will, for instance, begin evaluation in 2Q19 and identify any potential improvements to short-term ATC that could be implemented before Oct. 1, 2021, as well as hold a short-term ATC workshop in 4Q19, and the second and fourth quarter of each fiscal year until Oct. 1, 2021.
The settlement agreement also noted that by Jan. 1, 2020, BPA will begin a stakeholder process to review business practices related to studies of transmission service requests (TSRs), with the goal to examine and develop a consistent and repeatable approach to studying requests for long-term firm point-to-point transmission service on the southern intertie and network. BPA and the transmission customers may identify the relevant business practices at the beginning of such process, the settlement agreement said.