ties when the exchange accounts become unbalanced from year to year. The rates are not intended for sales of large quantities of capacity and energy and thus should not threaten Bonneville's financial position. The Commission finds that the total revenues from these rates and charges are very small in comparison to Bonneville's overall revenues. They constitute only 0.07 percent of Bonneville's overall revenue requirement in the instant rate period. It does not appear, therefore, that Bonneville's PNCA rates would violate the standards of section 7(a)(2). Therefore the PNCA rates will be approved as requested.

Regional Rates

Some intervenors assert that Bonneville has inappropriately changed the floor in the VI-87 rate schedule. In addition, certain intervenors have concerns about the implementation of a provision which protects Bonneville's preference customers from certain cost increases. The Commission has determined that these issues are rate design issues. In its order on final approval of Bonneville's 1984 rates and again in its order on final approval of Bonneville's 1985 rates, the Commission stated that it will not address rate design matters.38 Accordingly, these issues will be dismissed.

One intervenor states that it believes that revision of the existing VI-86 rate schedule was merely ministerial and that, therefore, the proposed Rate Schedule VI-87 should not have been submitted to the Commission for confirmation and approval. Commission review of the proposed VI-87 rate schedule indicates that it contains several substantive changes from the VI-86 rate schedule. The VI-87 rate incorporates the CRAC, has a changed provision that applies to Bonneville's right to restrict deliveries to the Direct Service Industrial Customers, and reflects a different rate for deliveries taken above the maximums specified in the customers' contracts. Therefore, the Commission concludes that it was incumbent upon Bonneville to submit the VI-87 rate for confirmation and approval.

Modified SL-87 is limited to sales within the Region. Bonneville states that sales made under this schedule will be made at rates above those that could be made on the spot market, the alternate market for this energy. Any sales made under this schedule would, therefore, increase Bonneville's revenues. Modified SL-87 responds to the concerns of specificity expressed in the Commission's April 6, 1988

order.39 This rate schedule meets the standards of section 7(a)(2).

Analysis of Rates for Nonfirm Sales Outside Pacific Northwest

Bonneville's rates for the sale of nonfirm power outside the Pacific Northwest must meet the standards of section 7(k) of the Northwest Act:

Notwithstanding any other provision of this Act, all rates or rate schedules for the sale of nonfirm electric power within the United States, but outside the region, shall be established after the date of this Act by the Administrator in accordance with the procedures of subsection (i) of this section... and in accordance with the Bonneville Project Act, the Flood Control Act of 1944, and the Federal Columbia River Transmission System Act. Notwithstanding section 201(f) of the Federal Power Act, such rates or rate schedules shall become effective after review by the Federal Energy Regulatory Commission for conformance with the requirements of such Acts and after approval thereof by the Commission. Such review shall be based on the record of proceedings established under subsection (i) of this section. The parties to such proceedings under subsection (i) shall be afforded an opportunity by the Commission for an additional hearing in accordance with the procedures established for ratemaking by the Commission pursuant to the Federal Power Act.

In general, the various acts mentioned in the above provision require that the rates be the lowest possible rates to consumers consistent with sound business principles and encourage the most widespread use of Bonneville power. Additionally, the rates must be developed having regard to the recovery of the cost of such electric energy and in a manner that protects the interest of the United States in amortizing its investment in the projects within a reasonable period.

Bonneville states that its nonfirm rates for sales outside the Pacific Northwest region meet the requirements of the Acts cited above because they are cost-based and widely available to all potential customers. The Commission's review of the filed rate schedule and the Administrator's Record of Decision supports Bonneville's conclusion.

Other Issues

Certain intervenors question the appropriateness of the upward flexibility provisions of NF-87 which would permit Bonneville to

tration, 39 FERC ¶61,078, reh'g denied, 40 FERC 61,069 (1987).

39 See supra note 9.

charge rates at any level up to 120 percent of average cost, contending that the rate is discriminatory against Pacific Southwest utilities and that the nonfirm rate should be cost-based. Other intervenors protest the 2-year limit on upward adjustments of the maximum charges in NF-87, contending that this limit will inhibit recovery of Bonneville's cost. These intervenors also object to the cap on the nonfirm rates. One intervenor expresses concern whether flexible pricing is consistent with the statutory requirements given Bonneville's control of the intertie. Another intervenor protests various aspects of Share-the-Savings Rate Schedule SS-87.

The Commission's review indicates that all of the issues noted above have been addressed by Bonneville in the Administrator's Record of Decision, that Bonneville has afforded reasonable consideration to the comments of the parties in preparing its filing, and that Bonneville has complied with the statutory standards. Consequently, these issues will be dismissed.

Some intervenors also claim that the proposed Nonfirm Energy Rate Schedule, NF-87, redefines energy billing determinants in violation of power sales contracts with customers. In its order on final approval of Bonneville's 1985 rates,40 the Commission stated that this issue was beyond the scope of Commission review. These intervenors have raised no new arguments here and, accordingly, the Commission's prior holding applies equally here.

The Commission orders:

(A) All motions to intervene not previously granted are hereby granted.

(B) Bonneville's request for approval of the Impact Aid Methodology is hereby granted on a final basis for the period October 1, 1987 through September 30, 1989.

(C) Bonneville's request for waiver of the five-year limitation on rate approval periods for rate schedules VI-87 and Modified SL-87, the PNCA, and the Nonfirm Energy Rate Cap contained in the General Rate Schedule Provisions is hereby granted.

(D) Bonneville's Rate Schedule Modified SL-87 is hereby confirmed and approved on a final basis for the period December 1, 1988 through September 30, 2010.

(E) Bonneville's Rate Schedule UFT-2 is hereby confirmed and approved on a final basis for the period October 1, 1987 through June 30, 1990.

(F) Bonneville's Rate Schedule VI-87 is hereby confirmed and approved on a final basis [The next

40 39 FERC at p. 61,206 n.10.

for the period October 1, 1987 through July 31, 1993.

(G) Bonneville's Rate Schedule FPT-87.3 is hereby confirmed and approved on a final basis for the period October 1, 1987 through September 30, 1990.

(H) Bonneville's Rate Schedule SP-87 is hereby confirmed and approved on a final basis for the period October 1, 1987, through September 30, 1992.

(I) The PNCA is hereby approved, as provided in the body of this order, from its effective date of July 1, 1986 until the Commission approves revised charges, upon the request of a party to the PNCA.

(J) Bonneville's Nonfirm Energy Rate Cap contained in the General Rate Schedule Provisions is hereby confirmed and approved on a final basis for the period October 1, 1987 through September 30, 1999.

(K) All of Bonneville's other power and transmission rate schedules filed in these dockets are hereby confirmed and approved on a final basis for the period October 1, 1987 through September 30, 1989.

(L) Bonneville's General Rate Schedule Provisions and General Transmission Rate Schedule Provisions are hereby confirmed and approved on a final basis for the periods covered by each respective approved rate schedule.

Bonneville Power Administration Docket Numbers EF87-2011-002, -006, -009 EF87-2021-001, -004

Petitions to Intervene

Petitioner Representating

California Public Utility Comm. - Same Direct Service Industrial Customers Aluminum Co. of America, Columbia Falls Aluminum Co., Georgia-Pacific Corp., Intalco Aluminum Corp., Kaiser Aluminum and Chemical Corp., Northwest Aluminum Co., Oregon Metallurgical Corp., Pennwalt Corp., Reynolds Metals Co.

Association of Public Agency Customers The Boeing Co., Boise Cascade Corp., International Paper Co., Longview Fiber Co., Occidental Chemical Corp., Pennwalt Corp., Scott Paper Co., James River Corp., Simpson Timber Co.

Western Public Agencies Group Public Utility Districts of Clallam, Clark, Grays Harbor, Klickitat, Lewis, Mason No. 1, Mason No. 3, Pacific, Skamania, Snohamish, and page is 61,695-3.]

demand amendment, the TSA is unjust and unreasonable; and (2) addresses issues which it states may be outside of the scope of the pending litigation in Docket No. ER90-39-000, and requests the earliest possible refund effective date in order to assure that it is guaranteed maximum refund protection should it prevail.4

Background

The TSA sets forth the terms, conditions, and rates under which Central Louisiana transmits power from the Rodemacher Unit No. 2 (Rodemacher 2) for Louisiana Energy and its members. Rodemacher 2, a generating unit jointly owned by Central Louisiana, Louisiana Energy and others, is located within Central Louisiana's service territory. Louisiana Energy owns 20 percent of the capacity of Rodemacher 2 (104.6 MW).

In support of its complaint, Louisiana Energy claims, first, that as a result of the

billing demand amendment, the billing demands under the TSA are set at the sum of the maximum demands of each of four delivery points (now totalling 124.6 kW) rather than for the maximum coincident loads (which Louisiana Energy claims can never exceed 104.6 kW). Louisiana Energy argues that the billing demands should be reduced to reflect its maximum coincident load, or that Central Louisiana's unit charge should be reduced.

Second, Louisiana Energy alleges that the TSA does not provide for pro rata load curtailments, but provides that in the event of insufficient capacity on Central Louisiana's system, Louisiana Energy's loads may be curtailed without Central Louisiana curtailing its own load at all. Louisiana Energy contends that Central Louisiana should provide pro rata cur

4 Louisiana Energy notes that although there may be an identity of issues between many, if not all, of the issues it raises in the instant docket and the issues in the pending litigation, it seeks to ensure that ¶ 61,236

all of its concerns are addressed by the Commission, and to ensure that refunds are ordered with respect to such issues should Louisiana Energy prevail.