May 12, 1998
 
BPA's Interpretation of the
Public Generating Pool Slice Proposal
 
 
General
  • Right to receive a percentage share of FCRPS capability, including actual energy generation (firm and secondary) and storage
  • Right to modify the rate at which such energy is produced within hour, day, week, month, year, within the bounds of operational and non-power requirements
  • Obligation to pay a corresponding percentage share of BPA costs, i.e., revenue requirement
Notes:
 
 
 
 
 
 
 
 
Term
  • 5-20 years.
  • No off-ramps for fish costs for term of contract
  • Possible off-ramps for acts of Congress such as repayment reform or other public purposes that would significantly increase the cost of power?
Notes:
 
 
 
 
 
 
 
 
Eligibility to Purchase
  • Any Subscriber
Notes:
 
 
 
 
 
 
 
 
Product Received
  • Proportionate share of the capability of the FCRPS, including both primary and secondary energy
  • Right to schedule or to send a signal to BPA for delivery of the energy in real time (allowing use of Slice for automatic generation control or reserves)
  • Proportionate share of the storage and shaping rights generally available to BPA, such as the ability to vary energy delivered during a day, or between days, weeks, or months within operating constraints
  • Hour-ahead changes in amount taken and within-hour ability to adjust signal
  • No purchasing or marketing services
  • No protection against required spill
Notes:
 
 
 
 
 
 
 
 
Linkages
  • Cannot be purchased in combination with Full Service or Declared Resource Products
Notes:
 
 
 
 
 
 
 
 
Costs to Purchasers
  • Percent share of FCRPS generation costs including:
     
    1. generation integration
       
    2. unforeseen fish and wildlife costs
       
    3. unforeseen maintenance costs
       
    4. Treasury and WPPSS bonds
       
    5. residential/small farm exchange costs
       
    6. environmental investments (some conservation and renewable resource costs?)
       
    7. other public purposes?
       
  • Budget, investment, cost allocations, marketing decisions as normally done by BPA
     
  • Costs excluded
     
    1. transmission costs (purchase at the bus-bar)
       
    2. General Transfer Agreement costs
       
    3. short term and long term marketing, trading floor
       
    4. certain PBL overheads (ratemaking?, billing?, contract administration?)
       
    5. new long-term purchases (for load growth, load variations, or resource replacement?)
       
    6. short-term power purchases
       
    7. Service and Exchange agreements
       
    8. financial reserves?
       
    9. spill caused by lack of market
       
    10. others?
       
Notes:
 
 
 
 
 
 
 
 
Basis for Payment
  • Based on a percentage share of a contractually determined embedded cost revenue requirement
  • Cost of product may over time vary based on factors determined in advance of contract execution
  • No credits from BPA's marketing revenues
  • Annual true-ups for cost underruns or extraordinary costs of generating units ("acts of God")
  • Could include annual "true-ups" based on actual costs incurred by BPA
  • Possible cost adjustments to non-requirement purchases, because of statutory rate directives
Notes:
 
 
 
 
 
 
 
 
Resources Included/Excluded
  • Includes hydro and thermal committed prior to 1/97 (less Canadian Entitlement obligations)
  • Includes long-term power purchases committed prior to 1/97
  • Excludes resources sold under another agreement
  • Excludes short or long-term purchases committed after 12/96
Notes:
 
 
 
 
 
 
 
 
Transmission
  • Not included; purchaser obtains own
Notes:
 
 
 
 
 
 
 
 
Reserves and Backup
  • Customer responsible for generation reserves to meet reliability standards
Notes:
 
 
 
 
 
 
 
 
Scheduling and Accounting
  • Use of flexibility rights accounted for daily in a "storage account"
  • Scheduling and accounting provisions established by contract
  • BPA may adjust the rate of power deliveries to reflect actual operating constraints on the FCRPS
Notes:
 
 
 
 
 
 
 
 
Forecast and Data Needs
  • Corps and Bureau system conditions, flood controls, boundaries
     
  • BPA's annual, seasonal, monthly, weekly, daily forecasts of
     
    1. HLH maximum hourly generation
       
    2. LLH minimum hourly generation
       
    3. must-run non-hydro generation
       
    4. maximum permissible deviations of storage
       
  • BPAs "telescoping" forecasts of the capability of the FCRPS, including both total generation and storage capabilities, and resulting limits to purchasers
     
  • BPA forecasted Energy Content Curve
     
  • BPA plans for operating within constraints
     
  • BPA agreements or plans to operate for some environmental purpose
     
  • Anticipated non-power operations
     
  • Non-hydro outages
     
  • Advance notice of limits on deliveries to and from storage account consistent with BPA's own limitations
     
Notes:
 
(This topic will be covered under a separate Agenda item)
 
 
 
 
 
 
Operations/Management Influence
  • Federal agencies make decisions on non-power requirements and operations of the FCRPS
  • Purchaser would have no authority in river management, investment, or other management decisions
Notes:
 
 
 
 
 
 
 
 
Dispute Resolution
  • Capabilities, constraints, production quantities subject to after-the-fact dispute resolution and other remedies (a high hurdle for requiring dispute resolution)
     
  • Remedies for
     
    1. false application of a constraint
       
    2. chronic manipulation of forecast data
       
    3. withholding information
       
    4. bad faith actions causing substantial damage
       
  • Remedies would be power replacement or monetary, not changes in river operations
     
Notes:
 
 
 
 
 
 
 
  h:\winword\slicmtg2.doc
 
Return to Summary of May 13, 1998, Slice Public Meeting