Citizens’ AcademyKathy Viehe

GRU Interim General Manager

November 12, 2014

The Basics GRU is a multi-service, community-

owned utility providing electric (93,000 customers), water, wastewater, natural gas and telecommunications services

Mission: To provide safe, reliable, competitively priced utility services in an environmentally responsible manner to enhance the quality of life in our community

Core Business Values: Delivering Customer Value through Safety, Efficiency, Environmental Responsibility and Professionalism

3

Measures of Success Service reliability compares well

Safe drinking water

Responsive to customers – local call center, employees live here

Natural gas rates among lowest in the state

Electric rates are high, but aggressively pursuing cost reductions and revenue enhancement

Excellent financial standing

4

GRU is a Big Business

$413 million annual operating budget

$1.6 billion in assets

$948 million outstanding debt Typical for a generating/multi-service utility

Among the highest bond ratings for municipal utilities from Fitch, Standard & Poor’s, and Moody’s

The Challenge: Electric Rates

How Did We Get Here?

Lower-than-forecast customer growth

Lower-than-forecast electric sales

Loss of wholesale sales Seminole contract

Market sales

Lower energy use in Florida and nationally

How Did We Get Here? Customer conservation combined with GRU

conservation programs

Federal standards improving appliance efficiency and state building codes

Addition of distributed generation (Solar Net Metering)

Loss of Business Partners’ Rate discount

Increased expenses (O&M, personnel)

Integration of new generation (GREC PPA)

Electric Sales (MWh)

O&M Expenses: Past 10 Years

2015 Business Plan

Focuses on three key areas: Maintaining our financial strength

Providing excellent service

Developing engaged and proficient employees

Major focus on cost containment and increasing revenues South Energy Center expansion

Wholesale sales

Providing new services/products to customers

Hot Topics

EPA regulation of carbon dioxide

Managing water resources

Regulatory compliance with wastewater standards

General manager search

Carbon Regulation EPA’s proposed “Clean Power Plan” calls for Florida

utilities to reduce carbon emissions by 38 percent by 2030

Concerns among municipal utilities: Technical issues

No credit for previous efficiency and emission control upgrades

Potential effect on customer bills

GRU is tracking the policy’s progress and working with other utilities to express concerns

Water ManagementConsumptive Use Permit

20-year permit approved in September authorizing groundwater withdrawals up to30 mgd, which is the same amount permitted since 2009

Project 25 percent increase in customers over this period

Groundwater withdrawals mitigated due to customer conservation efforts, increased use of reclaimed water and aquifer recharge projects

Wastewater Regulatory Compliance

Biosolids Recycling

Currently converted into fertilizer and applied to a local farm to supplement farming needs

Estimated cost of $23 million to change disposal method to comply with regulations

Dewatering facility under construction

General Manager Search

Job description approved by City Commission in July

Currently evaluating proposals from search firms

Hope to have new GM in place by spring 2015

16

UF Energy Supply

GRU provides water and natural gas service to UF

Also provides electricity off-campus, making UF one of our largest customers

UF’s steam agreement with Duke Energy expires soon

GRU stands ready to assist UF with its on-campus electrical needs

The GRU Bill Can include the following utility services:

Electric

Water

Wastewater

Natural gas

Also can include City of Gainesville services:

Stormwater

Garbage/refuse

The quiz – How many kWh did you use last month?

Know your bill

Join Our Advisory Committee

New advisory committee to help GRU with customer communication efforts

Accepting applications

Sign up at gru.com/ccag

19

Employee Recruitment & Retention

Currently more than 800 GRU employees

Challenges: Many experienced, long-term employees set to retire

Lack of depth in workforce; expectation to do more with less

Goal: Develop and implement ongoing succession-planning

process to address current and future talent needs in order to continue providing safe, reliable service for our customers

Employees are the Core of the Services We Provide

Questions?

22