Bryan Texas Utilities FY15 Rate and Budget...
Transcript of Bryan Texas Utilities FY15 Rate and Budget...
Bryan Texas Utilities
FY15 Rate and Budget Presentation August 12, 2014
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Gary Miller General Manager Bryan Texas Utilities
Cost of Service Rate Design
Municipal Electric Rates Fair - Equitable - Predictable * prevent cross subsidization * minimize large swings in price Local Control Not for Profit Cost of Service studies identify the costs to serve each type of customer and is then used to set rates accordingly Regular COS studies identify valuable information for the financial proforma needed for both short and long range strategic business planning
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NewGen Strategies, LLC
Municipal and Governmental Clients in Texas Include: • Austin (Texas) • Austin Energy (Texas) • Bryan Texas Utilities (Texas) • Garland Power & Light (Texas) • Garland (Texas) • Greenville Electric Utility System (Texas) • Lubbock (Texas) • Lubbock Power & Light (Texas)
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Cost of Service
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O&M Expense
Debt Service
GFT
Capital
Other
Prod. Demand Energy
Trans. Demand
Dist. Demand
Customer
Cust. Svc. Cust.
1 2 3. Classify 4. Allocate
COST OF SERVICE BY RATE CLASS
Cost of Service Results - City
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-3% -8% -6%
2% 0%
11%
0%
-50%
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
-$0.150
-$0.100
-$0.050
$0.000
$0.050
$0.100
$0.150
Residen. SmallComm
GeneralService
LargeIndustrial
Trans.Service
RuralElectricDivision
Total
$/KW
H
City Cost of Service Rate vs. Current Rate ($/kWh and Percentage Change)
Current Rate COS Rate Change
Cost of Service Results - Rural
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11% 0% -5%
4% 12% 7%
-100%
-80%
-60%
-40%
-20%
0%
20%
40%
60%
80%
100 %
-$0.150
-$0.100
-$0.050
$0.000
$0.050
$0.100
$0.150
Residen. Residen. CS SmallComm
GeneralService
Irrigation Total
$/KW
H
Rural Cost of Service Rate vs. Current Rate ($/kWh and Percentage Change)
Current Rate COS Rate Change
Residential Comparison – City/Rural
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$0.1019 $0.0985
$0.0934
$0.1033
CURRENT RATE COS
City and Rural Residential Rate Comparison ($/kWh)
City Rural
Phased in Approach
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Retail rates designed to reach cost of service for all classes in three phases Rate increases initially offset by decrease to
Power Supply Adjustment Power Supply Adjustment offset duration
dependent on future fuel costs Maintain Regulatory Charge pass through in
Rate Structure
City Residential Rate Comparison
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$100 $109 $105
$110 $116 $116
$128
BTU - City BTU - CollegeStation
Austin EnergyCity Rate
GarlandPower and
Light
BluebonnetElectric Coop
NavasotaValley Electric
Coop
CollegeStationUtilities
Average Monthly Residential Bill at 1,000kWh ($/Month)
Rural Residential Rate Comparison
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$159 $160 $162 $172 $172 $188
Proposed BTU -Rural
Garland Powerand Light
BluebonnetElectric Coop
Austin EnergyOutside City
Rate
Navasota ValleyElectric Coop
College StationUtilities
Average Monthly Residential Bill at 1,500kWh ($/Month)
Small Commercial Comparison
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$107 $104
$121 $130 $133
$150
BTU - City BTU - Rural Austin EnergyCity Rate
BluebonnetElectric Coop
Garland Powerand Light
College StationUtilities
Secondary Service Small - Average Monthly Bill at 1,000 kWh
City Commercial Demand Rate
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$2,156 $2,108
$2,553 $2,777 $2,859 $2,991
BTU - City BTU - Rural BluebonnetElectric Coop
Austin EnergyCity Rate
CollegeStationUtilities
GarlandPower and
Light
Secondary Service Demand Average Monthly Bill 25,000kWh Energy Usage/85kW Demand
(40% Load Factor)
Conclusions
• BTU can temporarily offset base rate increases by returning current fuel charge over-recovery balance
• Total City rate increase with fuel offset: 0 percent
• Total City rate increase without fuel offset: 2.4 percent
• Total Rural rate increase with fuel offset: 7 percent
• Total Rural rate increase without fuel offset: 9.9 percent
• At end of phase in period and end of fuel offset, BTU still maintains competitive rates.
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BTU Board Recommendation
• Modify rates to collect correct cost of service • Phase in rates over a three year period to
minimize cost impacts on customers • Adopt Electric Rate Ordinances as proposed
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FY15 Budget Highlights
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Capital Spending
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$-
$5
$10
$15
$20
$25
$30
FY8 FY9 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19
Transmission Distribution Production Billing/AMI All Other
Transmission Projects • FY15 Atkins to Briarcrest $ 5.0 mm
Wellborn to Millican $ 2.1 mm Kurten Sub $ 1.5 mm Triangle Park Sub $ 1.3 mm
• FY16 Rayburn to Nall $ 1.5 mm
• FY17-19 Triangle Park Sub #2 $ 6.0 mm Underground Cable Replace $ 5.0 mm Annex Sub $ 4.5 mm Tabor to Rayburn $ 4.5 mm Graham Sub $ 3.5 mm
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-
$1
$2
$3
$4
$5
$6
$7
$8
$9
FY8 FY9 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19
Distribution Substation Other Distribution
Distribution CIP Trends - City (in millions of $)
FY15 Distribution Projects - City
• Pole Replacement Program $2.3 mm
• Atkins to Briarcrest Upgrade $385k • Atkins Cable Tray
$250k • Underground Cable Replacement $160k • GIS Mapping
$160k
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Distribution CIP Trends - Rural (in millions of $)
$-
$1
$2
$3
$4
$5
$6
$7
$8
FY8 FY9 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19
Distribution Subtation Distribution Other AMI
FY15 Rural Distribution Projects
• New Customer Construction $2.9 mm • New Feeder Construction $0.9 mm • Distribution Substations $0.4 mm
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Financial Measures
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BTU Credit Ratings
S&P
• A+ • Stable
Outlook
Fitch
• A+ • Stable
Outlook
Moody’s
• A2 • Stable
Outlook
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‘AA’—Very strong capacity to meet financial commitments. ‘A’—Strong capacity to meet financial commitments, but somewhat susceptible to adverse economic conditions and changes in circumstances.
Days Operating Cash – City System
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-
20
40
60
80
100
120
140
160
180
200
2012 2013 2014 2015 2016 2017 2018
Minimum
Debt Service Coverage – City System
Target
Minimum
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0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
2012 2013 2014 2015 2016 2017 2018
Days Operating Cash – Rural System
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-
20
40
60
80
100
120
2012 2013 2014 2015 2016 2017 2018
Minimum
Debt Service Coverage – Rural System
Target
Minimum
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0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
2012 2013 2014 2015 2016 2017 2018
Budget Summary
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FY15 Expenditure Assumptions
Overall Expenditures up $20.1 mm
• Energy cost up $12.6 mm due to customer growth, greater off-system sales, and expected higher fuel costs
• TMPA capacity cost up $6.3 mm • Higher General Fund Transfer - $1.4 mm • Departmental O&M up $ 100k (less than 1%) for:
– 3.5% Merit – 4 staff additions – Offset by lower production maintenance costs
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FY15 Budget Proposal – City System (in thousands of $)
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FY15 Budget Proposal – City System (in thousands of $)
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FY15 Budget Proposal – Rural System (in thousands of $)
FY15 Budget Proposal – Rural System (in thousands of $)
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BTU – General Fund Transfer (in millions of $)
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0
2
4
6
8
10
12
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2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Next Steps
• Council Feedback
• Rate and Budget Resolutions from BTU
• Incorporate BTU Budget into total City Budget
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