[Code of Federal Regulations]
[Title 18, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 18CFR11.11]

[Page 181-182]
 
           TITLE 18--CONSERVATION OF POWER AND WATER RESOURCES
 
  CHAPTER I--FEDERAL ENERGY REGULATORY COMMISSION, DEPARTMENT OF ENERGY
 
PART 11_ANNUAL CHARGES UNDER PART I OF THE FEDERAL POWER ACT--Table of Contents
 
                Subpart B_Charges for Headwater Benefits
 
Sec. 11.11  Energy gains method of determining headwater benefits charges.

    (a) Applicability. This section applies to any determination of 
headwater benefits charges, unless:
    (1) The Commission has approved headwater benefits charges pursuant 
to an existing coordination agreement among the parties;
    (2) The parties reach, and the Commission approves, a settlement 
with respect to headwater benefits charges, pursuant to Sec. 11.14(a) 
of this subpart; or
    (3) Charges may be assessed under Sec. 11.14(b).
    (b) General rule--(1) Summary. Except as provided in paragraph 
(b)(3) of this section, a headwater benefits charge for a downstream 
project is determined under this subpart by apportioning the section 
10(f) costs of the headwater project among the headwater project and all 
downstream projects that are not exempt from or waived from headwater 
benefits charges under Sec. 11.10(b) of this chapter, according to each 
project's share of the total energy benefits to those projects resulting 
from the headwater project.
    (2) Calculation; headwater benefits formula. The annual headwater 
benefits charge for a downstream project is derived by multiplying the 
section 10(f) cost by the ratio of the energy gains received by the 
downstream project to

[[Page 182]]

the sum of total energy gains received by all downstream projects 
(except those projects specified in Sec. 11.10(b) of this chapter) plus 
the energy generated at the headwater project that is assigned to the 
joint-use power cost, as follows:
[GRAPHIC] [TIFF OMITTED] TC14NO91.093

In which:

P=annual payment to be made for headwater benefits received by a 
downstream project,
Cp=annual section 10(f) cost of the headwater project,
En=annual energy gains received at a downstream project, or 
group of projects if owned by one entity,
Ed=annual energy gains received at all downstream projects 
(except those specified in Sec. 11.10(b) of this chapter), and
Ej=portion of the annual energy generated at the headwater 
project assigned to the joint-use power cost.

    (3) If power generation is not a function of the headwater project, 
section 10(f) costs will be apportioned only among the downstream 
projects.
    (4) If the headwater project is constructed after the downstream 
project, liability for headwater benefits charges will accrue beginning 
on the day on which any energy losses at the downstream project due to 
filling the headwater reservoir have been offset by subsequent energy 
gains. If the headwater project is constructed prior to the downstream 
project, liability for headwater benefits charges will accrue beginning 
on the day on which benefits are first realized by the downstream 
project.
    (5) No final charge assessed by the Commission under this subpart 
may exceed 85 percent of the value of the energy gains. If a party 
demonstrates, within the time specified in Sec. 11.17(b)(3) for 
response to a preliminary assessment, that any final charge assessed 
under this subpart, not including the cost of the investigation assessed 
under Sec. 11.17(c), exceeds 85 percent of the value of the energy 
gains provided to the downstream project for the period for which the 
charge is assessed, the Commission will reduce the charge to not more 
than 85 percent of the value. For purposes of this paragraph, the value 
of the energy gains is the cost of obtaining an equivalent amount of 
electricity from the most likely alternative source during the period 
for which the charge is assessed.