Office of Fossil Energy; Application To Rescind Presidential Permit; Joint Application for Presidential Permit Sempra Energy Resources and Termoeléctrica U.S., LLC

AGENCY:

Office of Fossil Energy, DOE.

ACTION:

Notice of application.

SUMMARY:

Sempra Energy Resources (SER) and Termoelectrica U.S., LLC (T-US) jointly applied to rescind Presidential Permit PP-235 held by SER and to issue a Presidential permit to T-US covering the same international transmission facilities. In addition, SER and T-US are requesting expedited consideration of their joint application.

DATES:

Comments, protests, or requests to intervene must be submitted on or before September 25, 2002.

ADDRESSES:

Comments, protests, or requests to intervene should be addressed as follows: Office of Coal & Power Import/Export, FE-27/Forrestal Building, U.S. Department of Energy, 1000 Independence Avenue, SW., Washington, DC 20585.

FOR FURTHER INFORMATION CONTACT:

Ellen Russell (Program Office) 202-586-9624 or Michael T. Skinker (Program Attorney) 202-586-2793.

SUPPLEMENTARY INFORMATION:

The construction, operation, maintenance, and connection of facilities at the international border of the United States for the transmission of electric energy between the United States and a foreign country is prohibited in the absence of a Presidential permit issued pursuant to Executive Order (EO) 10485, as amended by EO 12038. Existing Presidential permits are not transferable or assignable. However, in the event of a proposed voluntary transfer of facilities, in accordance with the regulations at 10 CFR 205.323, the existing permit holder and the transferee are required to file a joint application with DOE that includes a statement of reasons for the transfer.

On August 29, 2002, SER and T-US jointly filed an application with the Office of Fossil Energy (FE) of the Department of Energy (DOE) for a transfer from SER to T-US of the facilities authorized by Presidential Permit PP-235. These facilities include the following facilities and all supporting structures within the right-of-way occupied by such facilities:

Two 230,000-volt electric transmission circuits installed on a single set of steel lattice towers and extending from San Diego Gas & Electric Company's Imperial Valley Substation approximately 6 miles south to the U.S. international border with Mexico.

At the border these transmission facilities connect to similar facilities owned by Termoelectrica de Mexicali (TDM) and continue south 3 miles to the 500-megawatt natural gas fired powerplant currently being developed by TDM west of the town of Mexicali, Baja California, Mexico.

SER is a California corporation engaged in the development, ownership, and operation of non-regulated electric generating facilities and the wholesale sale of electric power. T-US, a Delaware limited liability corporation, will own and operate the U.S. portion of the transmission facility. Both SER and T-US are indirect wholly owned subsidiaries of Sempra Energy, a California corporation. SER and T-US request the recession of PP-235, issued to SER on December 5, 2001, and the simultaneous issuance of a Presidential permit to T-US for the same facilities enabling the parties to effectuate an internal corporate reorganization that will result in T-US owning, operating, and maintaining the transmission facility as an exempt wholesale generator (EWG).

The proposed transfer of these facilities has no effect on the proceeding currently before FE in Docket EA-235, SER's application to export a maximum of 12 MW of electric energy to the TDM powerplant using these same transmission facilities. In the EA-235 proceeding, SER proposes to export electric energy for the purpose of providing “black start” capability to the TDM powerplant and for providing ancillary equipment power when the facility's electrical generating equipment is not in operation. These transmission facilities are not interconnected with the electrical distribution system of Mexico owned and operated by Comision Federal de Electricidad, the national electric utility of Mexico.

Construction of the international transmission facilities that are the subject of this application was completed by SER earlier this year; however, the transmission line has not yet been energized. SER and T-US plan to energize the facility in October 2002 and, therefore, have requested expedited consideration of this joint application. Accordingly, DOE has shortened the public comment period to 15 days in order to allow completion of this proceeding within the applicants' time period.

Since restructuring of the electric power industry began, resulting in the introduction of different types of competitive entities into the marketplace, DOE has consistently expressed its policy that cross-border trade in electric energy should be subject to the same principles of comparable open access and non-discrimination that apply to transmission in interstate commerce. DOE has stated that policy in export authorizations granted to entities requesting authority to export over international transmission facilities. Specifically, DOE expects transmitting utilities owning border facilities to provide access across the border in accordance with the principles of comparable open access and non-discrimination contained in the FPA and articulated in Federal Energy Regulatory Commission Order No. 888 (Promotion Wholesale Competition Through Open Access Non-Discriminatory Transmission Services by Public utilities; FERC Stats. & Regs. ¶31,036 (1996)), as amended. In furtherance of this policy, on July 27, 1999, (64 FR 40586) DOE initiated a proceeding in which it noticed its intention to condition existing and future Presidential permits, appropriate for third party transmission, on compliance with a requirement to provide non-discriminatory open access transmission service. That proceeding is not yet complete. However, in this docket DOE specifically requests comment on the appropriateness of applying the open access requirement on facilities proposed to be transferred to T-US.

Procedural Matters: Any person desiring to become a party to this proceeding or to be heard by filing comments or protests to this application should file a petition to intervene, comment or protest at the address provided above in accordance with §§ 385.211 or 385.214 of the FERC's Rules of Practice and Procedures (18 CFR 385.211, 385.214). Fifteen copies of each petition and protest should be filed with the DOE on or before the date listed above.

Additional copies of such petitions to intervene or protests also should be filed directly with: Alberto Abreu, Director, Permitting and Licensing, Sempra Energy Resources, 101 Ash Street, P.O. Box 1831, San Diego, CA 92112-4150.

Before a Presidential permit may be issued or amended, the DOE must determine that the proposed action will not adversely impact on the reliability of the U.S. electric power supply system. In addition, DOE must consider the environmental impacts of the proposed action (i.e., granting the Presidential permit, with any conditions and limitations, or denying the permit) pursuant to the National Environmental Policy Act of 1969. DOE also must obtain the concurrence of the Secretary of State and the Secretary of Defense before taking final action on a Presidential permit application.

Copies of this application will be made available, upon request, for public inspection and copying at the address provided above. In addition, the application may be reviewed or downloaded from the Fossil Energy Home Page at: http://www.fe.doe.gov. Upon reaching the Fossil Energy Home page, select “Electricity Regulation” from the options menu, and then “Pending Proceedings.”