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the test year Is determined. Then the expected use of each category of the 

 Federal system reserve requirement is determined. These categories, forced 

 outage and plant delay reserves, are then analyzed in conjunction with the 

 amount of reserves provided by the restriction rights to determine if the 

 reserves provided by BPA's ability to restrict the industrial load can meet 

 the reserve requirements. And finally, each reserve category is separately 

 valued at the cost to BPA of providing the reserve through an alternative 

 means. 



II. Determination of the Federal Reserve Requirement 



The Federal system capacity reserve requirements for the value of 

 reserves analysis are based on the loads and resources used in BPA's Cost of 

 Service Analysis. This information 1s the most current available, and 

 incorporates in the value of reserves analysis all assumptions and studies 

 used In support of the 1985 wholesale power and transmission rate filing. For 

 the current rate filing, reserves are based entirely on resources in operation 

 during the test year (FY 1987). Required reserves are calculated at five 

 percent of hydro resources and 15 percent of thermal resources. The total 

 Federal reserve requirement for FY 1987 varies by month from a low of 

 1016 megawatts in May to a high of 1288 megawatts in December. 



For the 1982 wholesale power rate filing. It was assumed that 

 1880 megawatts of combustion turbines were installed to meet reserve 

 requirements. As the reserve requirement for rY 1987 is less than the 



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