6.1a ERMUSR 03-13-2017 - Laserfiche WebLink

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Position Statement Protecting the Interests of WAPA Customers The four federal power marketing administrations (PMAs) deliver reliable, cost-based hydroelectric ,•., power to various regions of the United States. Approximately 1,200 public power systems and rural electric cooperatives throughout the country buy low-cost, zero-emissions hydropower from the , , PMAs, that market this power from the federal ) WOW multi-purpose dams. The Western Area Power Administration (WAPA) • is the PMA that delivers power to a 15 state region of the central and western United States that also includes the western third of Minnesota. WAPA's The Fort Randall dam on the Missouri River in South Dakota. 17,000-mile transmission system carries electricity from 55 hydropower plants operated by the Bureau In accordance with federal law, PMA"cost based" of Reclamation, the U.S.Army Corps of Engineers rates are set at the levels needed to recover the and the International Boundary and Water Commission. Minnesota is served by WAPA's costs of the initial federal investment (plus interest) Upper Great Plains Region office, which provides in the hydropower and transmission facilities. electricity from the seven dams of the Pick-Sloan The PMAs annually review their rates to ensure Missouri River Program established by Congress in full cost recovery. None of the costs are borne 1944. by taxpayers. If a deficit is projected, rates are adjusted to eliminate any deficit. Power rates also help to cover the costs of other activities authorized WAPA is critical to Minnesota municipal utilities, by these multipurpose dams such as navigation, providing about one third of the wholesale power needs of 47 public power systems serving over flood control, water supply, environmental 200,000 people in the western part of the state programs, and recreation. PMA power is generally low-cost in relation to other sources of electricity Congressional Action because hydropower is a renewable resource Every few years, various interests and agencies and most dams were constructed long ago, when propose to use WAPA and the other PMAs for material and labor costs were much lower than purposes that depart from the original, vital goals today. of the federal power marketing program. Several MMUA Position proposals that have been rejected over the years MMUA urges Congress to reject proposals that include: reallocation of Pick-Sloan irrigation costs would disrupt the stable, low-cost, and emission to power customers; an administrative increase in free power that WAPA provides to so many the interest paid on new PMA investments; and Minnesota communities. For well over half a the requirement that PMAs to sell power at market century there has been a successful partnership rates. between federal Power Market Administrations Though President Trump has not yet released and the communities that receive a federal his budget recommendations, there are again hydropower allocation. This has helped keep costs rumblings that the new Administration questions low for our customers. Requiring PMA power to the role of PMAs and a proposal to sell PMA power be sold at market rates will lead to uncertainty in at market rates could be forthcoming. municipal utility budgeting and resource planning and rate increases for our customers. 2017 Federal Position Statements/9 178