Western Area Power Administration (2020 Presidential transition)

Book 3 - Organization Overview
Entire 2020 DOE Transition book As of October 2020

Western Area Power Administration (WAPA) contributes to a more economically competitive, environmentally responsive, secure and resilient U.S. energy infrastructure. A critical leader in the energy industry, WAPA is an integral asset to the Department’s mission and future vision of a vibrant, reliable, and responsible energy economy with its vast interconnected power system, expert staff, and strong relationships with utility customers and Federal and industry partners.

WAPA operates and maintains one of 10 largest high-voltage electric transmission systems in the U.S. Mission activities include marketing power, controlling several balancing areas, and maintaining its 17,000-plus miles of high-voltage transmission lines across 1.5 million square miles in 15 central and western states. WAPA markets hydropower generated at 57 Federal hydroelectric dams to more than 700 customers each year, most of which are not-for-profit public utilities in rural America.

By managing its assets in a sustainable manner, and by maintaining and modernizing its facilities, WAPA ensures flexible and reliable operations to accommodate industry change and requested interconnections WAPA engages increasing interest in renewable resources while partnering with industry to expand infrastructure to deliver renewable energy sources. WAPA performs its mission in a manner that promotes the development of higher capacity U.S. energy infrastructure to ensure flexible, reliable operations and efficient energy markets.

Mission Statement

Market and deliver clean, renewable, reliable, cost- based Federal hydroelectric power and related services:

Budget

Fiscal Year	Budget
FY 2019 enacted	$89,372,000
FY 2020 enacted	$89,196,000
FY 2021 requested	$89,372,000

Human Resources

FY 2020 authorized full-time equivalents (FTEs): 1,521

History

WAPA was formed from functions previously carried out by the Department of the Interior ’s Bureau of Reclamation (BOR) and International Boundary Water Commission (IBWC) upon the creation of DOE in 1977. WAPA markets and delivers clean hydroelectric power from 57 hydropower plants owned and operated by the U.S. Army Corps of Engineers (Corps), BOR, and IBWC. The primary authorization for BOR and Corps dams is to provide flood control, irrigation, and navigation, among other functions; however, any power produced in excess of project pumping needs, is sold to repay the government’s investment in the projects (for example Hoover Dam). WAPA markets this power to customers in a manner that encourages the most widespread use at the lowest possible rates consistent with sound business principles. (Flood Control Act of 1944)

One of WAPA’s greatest accomplishments occurred in 2009 when it was authorized by Congress via the American Recovery and Reinvestment Act to borrow up to $3.25 billion from the U.S. Department of Treasury to support the development of projects that facilitate and optimize the delivery of reliable, affordable power generated by renewable energy resources. WAPA established the Transmission Infrastructure Program (TIP) to carry out and manage this authority and has already seen three projects successfully completed. WAPA’s headquarters office is located in Lakewood, Colorado, which is within its service territory, and its Administrator and CEO reports to the Assistant Secretary, Office of Electricity .

Functions

In compliance with Reclamation Act of 1902 and the Reclamation Project Act of 1939 , WAPA’s mandated functions performed include: power marketing; providing transmission and ancillary services; building transmission lines; operating and maintaining transmission infrastructure; and providing energy system balance and delivery services.

Recent Organization Accomplishments

Strategic Roadmap 2024

The creation of the Strategic Roadmap 2024 applies WAPA’s historic mission to the dynamics of an evolving energy industry environment that includes a myriad of new regulations; a growing presence of interruptible and intermittent generation resources; and constraints on WAPA hydro resources. The roadmap ties together WAPA’s strategy, initiatives, capital budgets, and annual targets to enable the agency to continue to meet customer needs and provide the best value as an organization. It consists of four overarching goals (“Critical Pathways”) all aimed toward promoting WAPA’s mission. These Critical Pathways are: Business; Technology and Organizational Excellence; Mutually Beneficial Partnerships; Evolution of Services; and Powering and Energy Frontier.

Asset Management

WAPA’s asset management program has allowed WAPA to identify how equipment operates, the current state of its assets, individual asset longevity into the future, and how best to invest for asset maintenance and replacement. The Asset Management program is a systematic process for managing WAPA’s most important transmission system assets to optimize functionality, operational performance, and return on investment while identifying and managing associated risk. This program currently tracks the overall health of 12 types of transmission equipment starting with the most critical equipment and progressively adding other components each year.

Safety Record

WAPA has a long and proactive safety record. Incident, injury, and lost-time rates are below the industry average of 1.2 recordable incident rate (RIR) and twelve hours away, restrictions, and transfers (DART) rate. WAPA continues to enhance and build upon its safety record Returns to Treasury WAPA is tasked with full cost recovery of Federal investment in power generation and transmission. Once the rate is recovered from customers, WAPA returns some funds to Treasury to pay down the investment. The amount returned to Treasury varies from year to year as WAPA uses the balloon methodology to recover from customers and has access to receipts to finance ongoing operations. Over the past 12 years, WAPA has returned $3.6 billion.

Keeping pace with industry

WAPA continues to monitor and respond appropriately to the changing energy environment in the West, particularly when it comes to markets. In 2019, WAPA successfully transitioned its balancing authorities and transmission operators to new reliability coordinators, fulfilling a critical regulatory requirement, after its existing reliability coordinator ceased operations. In addition, in 2019 and 2020 WAPA comprehensively evaluated and selected third-party vendors to provide cost-effective, efficient, and secure energy imbalance management services that will take advantage of greater resource diversity within a larger service territory than WAPA can access on its own.

Continuous process improvement

WAPA’s Continuous Process Improvement Program is based on the Lean Six Sigma process improvement methodology. This methodology focuses on improving customer service, efficiency, and effectiveness to support the lowest possible rates consistent with sound business practices. Since the program’s inception in March 2014, the program has resulted in more than $110 million in mostly cost avoidance.

Expanding broadband access to rural America

WAPA had completed a project plan for the pilot project to support three customers’ needs for access to broadband using WAPA’s existing infrastructure. If successful, this project could provide support to WAPA customers who are otherwise unable to access broadband in rural America.

Transmission and Infrastructure Program

WAPA’s Transmission Infrastructure Program (TIP) leverages WAPA’s depth of transmission project development experience and expertise, along with its statutory borrowing authority, to advance projects aimed at expanding and modernizing the electric grid.

TIP accomplishments: The Montana Alberta Tie Line (MATL) was the first TIP project, which was developed to deliver wind generation into the Alberta market. The project’s $161 million loan financing, primarily through construction, was repaid in August 2012. Electric District No. 5 to Palo Verde Hub (ED5-PVH), was the second TIP project and was energized in January 2015 to renewable energy development in the Southwest. The TransWest Express development phase supported preliminary activities before construction of a potential 725-mile transmission line between Wyoming and the Southwest capable of carrying 3000 megawatts of energy. Development activities included environmental reviews, feasibility studies, and permitting requirements. TIP contributed $25 million to support the development phase and retains the ability to participate in the construction phase, if desired, in the future. To date, WAPA had advanced funding arrangements (AFA) with project developers to cover all costs associated with TIP- led technical and other development assistance for the following projects: AES Energy Storage, Ten West, TransWest Express, Southline, SunZia, and Westlands.

Additionally, WAPA has Memorandum of Understandings (MOU) in place for the following projects: San Luis Transmission Project and Meade to Adelanto Transmission Upgrade.

Physical Security

WAPA has developed a data-driven, risk based approach to protecting its assets, as well as standardized security methodologies and processes throughout its four regions. In addition, WAPA continues to collaborate with stakeholders to implement the most cost effective and efficient security solutions for the enterprise. WAPA conducts risk assessments on its critical facilities every 30 months and its noncritical facilities every five years.

Cybersecurity

WAPA operates a large business information network that covers most of the Western U.S. and serves its widespread constellation of four control centers, seven administrative facilities, 300 substations, and 660 maintenance, communications and other facilities. This network provides administrative services such as email and internet connectivity as well as asset management and financial management systems.

In addition, WAPA operates supervisory control and data acquisition (SCADA) systems in our control centers at Watertown, SD; Phoenix, AZ; Loveland, CO; and Folsom, CA. These systems provide critical grid monitoring and control functions, are connected via private networks to the substations in their respective regions, and as appropriate to neighboring utilities and business partners.

WAPA’s Cybersecurity Program has been extremely validated through multiple audits and peer reviews by DOE, the North American Electric Reliability Corporation (NERC), and industry peer groups. WAPA continues to work with the intelligence community, the National Laboratories, and DOE’s Office of Cybersecurity, Energy Security, and Emergency Response (CESER) to provide opportunities to improve critical infrastructure skills and awareness.

Ten-Year Capital Plan

The WAPA-wide ten-year capital investment plan is developed via analysis conducted in the Asset Management, maintenance, and regional financial programs. WAPA headquarters financial programs are revised annually. The FY 2020 capital investment is estimated to be approximately $250 million.

Wildfire Mitigation

Over the past few years, WAPA has evaluated its operational risk and vulnerability to wildfires across the enterprise following multiple severe wildfire seasons across its territory. WAPA reviewed its vegetation management programs for adequacy and accuracy given what the industry now knows about wildfire prevention. WAPA is also collaborating with State and Federal partners to ensure it is doing what it can to prevent fires caused by powerlines, mitigate the impact of fires on WAPA equipment, and provide support to firefighting efforts. WAPA has taken a leadership role in wildfire mitigation strategies, including low-tech and high-tech solutions, routine inspections, voluntarily complying with state laws and regulations in this area, and seeking the advice of wildfire experts on leading practices to reduce wildfire risk.

Leadership Challenges

WAPA’s leadership challenges include:

Systems Operations. The changing nature of the grid, the influx of different types of generation, and increased intermittency require all utility operators to change the way systems are managed and operated. WAPA continues to evolve its operations to match the changing needs created by new generation resources.

Varying Hydro Conditions. WAPA markets and delivers power generated from 57 hydropower plants, and continually monitors and manages changes in hydrology. Each of the major river systems (Colorado, Missouri, etc.) is different and water conditions vary widely. In high water years, WAPA markets excess generation, and in low water years, WAPA must purchase power on the market to meet its contractual commitments to customers. In addition, with the rapid retirement of coal, nuclear, and some natural gas plants, hydropower has become one of the last remaining baseload generation sources available across the West, which is essential for continued grid reliability.

Regulatory Environment. WAPA is impacted by several regulatory activities. These include ever- tightening utility reliability standards; Environmental Protection Agency regulations; land use restrictions; tribal and cultural regulations and protocol; fish and wildlife regulations; and a host of related requirements. WAPA maintains a significant environmental team to manage its territory and expends considerable funds and resources to ensure continued compliance with regulations.

Critical Events and Action Items

January/March 2021. WAPA’s Desert Southwest Region plans to announce its decision on energy imbalance management in late 2020 or early 2021. WAPA’s Colorado River Storage Project , Rocky Mountain and Upper Great Plains–West will transition into the Southwest Power Pool Western Energy Imbalance Service in February 2021, and its Sierra Nevada Region will transition into California Independent System Operator Western Energy Imbalance Market in March 2021. In addition, WAPA’s plans to implement its Responsible Workplace Reentry plan to safely return some employees to the office in response to the COVID-19 pandemic in late January or early March 2021. WAPA also plans to provide interconnections in support of the Keystone XL project. The design, procurement, and/or construction award may occur during early 2021. WAPA will implement new reliability compliance standards, including: BAL-003.2, CIP- 008-6, PRC-006-3, PRC-012-2, PRC-027-1, PER-006-1, and TPL-007-4.^[1]