Boulder er C Canyon Projec ect FY19 FY19 I Informal B Base C se Cha harge e Meet eting ng March 1, 2018 Kevin Schaefer Public Utilities Specialist
Age genda • FY19 Preliminary Base Charge and Rates • Review Handout • Financial Summary • FY18 Base Charge vs Revised Budget • FY18 Base Charge vs Preliminary FY19 Base Charge • Next Steps • Additional Resources 2
Preliminary B Base Charge and Rates FY18 Preliminary % Base Charge FY19 Base Charge Change Base Charge $76,910,193 $73,970,657 -$2,939,536 - 3.8% Composite Rates (Mills/kWh) 19.98 19.21 -0.76 - 3.8% ) Energy Rate (Mills/kWh) 9.99 9.61 -0.38 - 3.8% Energy Sales (MWh) 3,849,647 3,849,647 - 0.00% Capacity Rate ($/kW-Mo) $1.99 $1.91 -$0.08 - 3.8% Capacity Sales (kW) 1,613,000 1,613,000 - 0.00% 3
Rev eview w Handout 4
Boulder Canyon Project Base Charge Summary (in thousands) Revised Preliminary FY18 Budget Est. FY19 Base Charge Bureau of (Reclamation) Operations $7,146 $8,048 Maintenance 18,316 17,112 A&GE 21,151 20,590 Extraordinary Maintenance 6,261 12,551 O&M 52,874 58,301 Replacements 12,270 5,734 OM&R 65,144 64,035 Post Retirement Benefits (PRB) 1,569 1,581 OM&R w/PRB 66,713 65,616 Western Area Power Administration (WAPA) Facility Expenses 3,212 2,396 Systemwide Expenses 5,775 6,362 O&M 8,986 8,758 Replacements 222 400 OM&R 9,208 9,158 Post Retirement Benefits 196 200 OM&R w/PRB 9,405 9,358 Total O&M 63,848 69,241 Total OM&R 76,118 74,975 Other Expense Visitor Services 12,912 9,063 Payments to States ‐ Reclamation 600 600 Uprating Payments ‐ Interest ‐ ‐ Uprating Payments ‐ Principal ‐ ‐ Debt Service Investments ‐ Interest 434 420 Other Interest (CME and Warehouse) 17 21 Debt Service Investments ‐ Principal Pmt. 538 557 Total Other Expense 14,501 10,661 Total Expense 90,619 85,636 Prior Year Carryover 11,927 0 Other Revenue Reclamation 15,000 10,000 WAPA 1,202 1,115 Other Revenue 16,202 11,115 Water Sales Revenue 580 550 Working Capital 15,000 ‐ Base Charge 76,910 73,971 March 2018 Page 1
Boulder Canyon Project FY18 Base Charge vs. Revised Budget Revised FY18 FY18 Budget Base Charge Est. Change Reclamation Operations $ 7,146,000 $ 7,146,000 $ ‐ Maintenance 17,086,000 18,316,000 1,230,000 A&GE 21,051,000 21,451,000 400,000 A&GE Refund Adjustment (Security) (300,000) (300,000) ‐ Subtotal A&GE 20,751,000 21,151,000 400,000 Extraordinary Maintenance 4,669,000 6,260,804 1,591,804 O&M 49,652,000 52,873,804 3,221,804 Replacements 7,754,000 12,270,290 4,516,290 OM&R 57,406,000 65,144,094 7,738,094 Post Retirement Benefits (PRB) 1,569,078 1,569,078 ‐ OM&R w/PRB 58,975,078 66,713,172 7,738,094 WAPA Facility Expenses 3,192,044 3,211,817 19,773 Systemwide Expenses 5,774,672 5,774,672 ‐ O&M 8,966,716 8,986,489 19,773 Replacements 200,000 221,907 21,907 OM&R 9,166,716 9,208,396 41,680 Post Retirement Benefits (PRB) 196,470 196,470 ‐ OM&R w/PRB 9,363,186 9,404,866 41,680 Total O&M 60,584,264 63,847,748 3,263,484 Total OM&R 68,338,264 76,118,038 7,779,774 Other Expense Visitor Services 8,765,000 12,912,437 4,147,437 Payments to States ‐ Reclamation 600,000 600,000 ‐ Debt Service Investments ‐ Interest 433,661 433,661 ‐ Other Interest (CME and Warehouse) 17,024 17,024 ‐ Debt Service Investments ‐ Principal Pmt. 537,966 537,966 ‐ Subtotal Other Annual Expense 10,353,651 14,501,088 4,147,437 Total Expense 78,691,915 90,619,126 11,927,211 Prior Year Carryover ‐ 11,927,211 11,927,211 Other Revenue Reclamation 15,000,000 15,000,000 ‐ WAPA 1,201,722 1,201,722 ‐ Other Revenue 16,201,722 16,201,722 ‐ Water Sales Revenue 580,000 580,000 ‐ Working Capital 15,000,000 15,000,000 ‐ $ ‐ Base Charge $ 76,910,193 $ 76,910,193 FY18 Carryover $ ‐ $ ‐ March 2018 Page 2
Boulder Canyon Project FY18 Base Charge vs. Revised Budget Reclamation's Narrative Maintenance: Increased expenditures due to carryover of FY17 unobligated funds (MYPF) that are needed to purchase equipment and accomplish work required in FY18. A&GE: Increased expenditures due to carryover of FY17 unobligated funds (MYPF) that are needed to accomplish work required in FY18. Extraordinary Maintenance: Increased expenditures due to carryover of FY17 unobligated funds (MYPF) that are needed to accomplish work required in FY18 for multiple projects. Replacements: Increased expenditures due to carryover of FY17 unobligated funds (MYPF) that are needed to accomplish work required in FY18 for multiple projects. Visitor Services: Increased expenditures primarily due to carryover of FY17 unobligated funds (MYPF) that are needed to award the contract for the Visitor Center Renovation in FY18. WAPA's Narrative Facility Expenses: Mead Common Facilities (Video Surveillance Upgrades and Security Trailer) funds carried over from FY17. Replacement: Hoover ‐ Mead Transmission Line Hardware Replacement and Hoover WIN/CIP project funds carried over from FY17. March 2018 Page 3
Boulder Canyon Project FY18 Base Charge vs. Preliminary FY19 Base Charge Preliminary FY18 FY19 Base Base Charge Charge Change Reclamation Operations $ 7,146,000 $ 8,048,000 $ 902,000 Maintenance 17,086,000 17,112,000 26,000 A&GE 21,051,000 20,790,000 (261,000) A&GE Refund Adjustment (Security) (300,000) (200,000) 100,000 Subtotal A&GE 20,751,000 20,590,000 (161,000) Extraordinary Maintenance 4,669,000 12,551,000 7,882,000 O&M 49,652,000 58,301,000 8,649,000 Replacements 7,754,000 5,734,000 (2,020,000) OM&R 57,406,000 64,035,000 6,629,000 Post Retirement Benefits (PRB) 1,569,078 1,581,283 12,205 OM&R w/PRB 58,975,078 65,616,283 6,641,205 WAPA Facility Expenses 3,192,044 2,395,875 (796,169) Systemwide Expenses 5,774,672 6,362,118 587,446 O&M 8,966,716 8,757,993 (208,723) Replacements 200,000 400,000 200,000 OM&R 9,166,716 9,157,993 (8,723) Post Retirement Benefits (PRB) 196,470 200,455 3,985 OM&R w/PRB 9,363,186 9,358,448 (4,738) Total O&M 60,584,264 69,240,731 8,656,467 Total OM&R 68,338,264 74,974,731 6,636,467 Other Expense Visitor Services 8,765,000 9,063,000 298,000 Payments to States ‐ Reclamation 600,000 600,000 ‐ Debt Service Investments ‐ Interest 433,661 420,066 (13,595) Other Interest (CME and Warehouse) 17,024 20,703 3,679 Debt Service Investments ‐ Principal Pmt. 537,966 557,482 19,516 Other Expense 10,353,651 10,661,251 307,600 Total Expense 78,691,915 85,635,982 6,944,067 Prior Year Carryover ‐ ‐ ‐ Other Revenue Reclamation 15,000,000 10,000,000 (5,000,000) WAPA 1,201,722 1,115,325 (86,397) Other Revenue 16,201,722 11,115,325 (5,086,397) Water Sales Revenue 580,000 550,000 (30,000) Working Capital 15,000,000 ‐ (15,000,000) Base Charge $ 76,910,193 $ 73,970,657 $ (2,939,536) March 2018 Page 4
Boulder Canyon Project FY18 Base Charge vs. Preliminary FY19 Base Charge Reclamation's Narrative Operations: Increased estimate primarily due to the re ‐ alignment of IT and Engineering salary to Operations in support of the SCADA system. A&GE: Decreased estimate primarily due to the re ‐ alignment of IT and Engineering salary to Operations in support of the SCADA system. Extraordinary Maintenance: Increased estimate primarily due to the following projects’ increased or new contract work: Nevada CheckPoint Structures, Rock Fall Mitigation, Erosion Repair, and Cincinnati Boring Mill Rebuild. Additionally, the Generator Life Extension project was pushed from FY18 to FY19. Replacements: Decreased estimate primarily due to decreased funding for the final year of the 16.5 kV Generator Breaker Replacement project. The decrease was partially offset by pushing the Flow Meter Replacement and Elevator Motor & Controller Replacement projects from FY18 to FY19. Visitor Services: Increased estimate primarily due to various service contract price increases. Other Revenue: Visitor Services decreased revenue estimate due to work on the Visitor Center elevators and renovation. Revised to $10M as requested by the TRC. WAPA's Narrative Facility Expenses: General Western Allocation and substation maintenance budget is lower due to changes in indirect cost allocation to better reflect cost causation and shifts in how Information Technology costs are allocated. Systemwide Expenses: Budget is higher predominantly due to increased costs in power marketing attributable to post ‐ 2017 Hoover contract implementation, a shift in how Information Technology costs are allocated and increases in system operations costs. Replacements: Budget is higher due to anticipated replacement projects not yet defined. March 2018 Page 5
Next S Steps ● Public Process Begins March 2018* ● Public Information Forum April 2018 @ 10am* ● Public Comment Forum May 2018 @ 10am* ● Public Process Concludes June 2018* ● Final Federal Register Notice Published Aug 2018* ● Effective Date of Base Charge Oct 1, 2018 *Tentative Dates 5
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