Great River Energy 2015 Annual Projected Rate Meeting Details

Slide Note

Great River Energy held its annual projected rate meeting on October 31, 2014, to discuss the projected net revenue requirement and associated network rate for 2015. The meeting included disclosures, a corporate profile overview, Attachment O details, and forward rate requirements. FERC requirements for the meeting were also highlighted. The document emphasized the preliminary nature of the figures subject to change pending finalization post-information exchange and review processes.

ttala Follow

Uploaded on Oct 11, 2024 | 0 Views

Download Presentation

Please find below an Image/Link to download the presentation.

The content on the website is provided AS IS for your information and personal use only. It may not be sold, licensed, or shared on other websites without obtaining consent from the author. Download presentation by click this link. If you encounter any issues during the download, it is possible that the publisher has removed the file from their server.

E N D

Presentation Transcript

Great River Energy 2015 Attachment O Annual Projected Rate Meeting October 31, 2014

Agenda Introduction Disclosure Meeting purpose Great River Energy corporate profile Attachment O calculation Capital projects Budget risks Information exchange procedures Question/answer

Disclosure All figures in this document are preliminary and subject to change. Per the revised Formula Rate Protocols, figures will be finalized after the Information Exchange, Challenge Procedures, and MISO s review are complete1. 1 Awaiting FERC s final decision on Docket ER13-2379 on FERC s investigation into MISO Formula Rate Protocols

Meeting purpose FERC requires GRE to hold an annual projected rate meeting by October 31 each year to (i) permit GRE to explain and clarify it s projected net revenue requirement and (ii) provide interested parties an opportunity to seek information and clarifications from GRE about the projected net revenue requirement Great River Energy s projected net revenue requirement and associated network rate commencing January 1, 2015 is calculated using GRE s Attachment O formula rate template within the MISO tariff

Corporate profile 28 member cooperatives 650,000 member-consumers 4th largest Generation & Transmission cooperative in the nation $3.7 billion assets $2.8 billion debt $980 million revenue 880 employees (MN and ND) 3,619 MW generation 701 MW renewables 4,660 miles transmission 102 transmission substations

Attachment O Forward rate requirements GRE revenue requirement distribution Rate base Operating expenses Rate of return Revenue requirement Network rate summary

Forward rate requirements By June 1 of each year GRE will post on OASIS all information in regards to our Attachment O, Attachment MM, and Schedule 1 True-Up Adjustment for the prior year including the associated workpapers and supplemental notes By August 1 of each year GRE will post on OASIS all information in regards to our Attachment GG True-up Adjustment for the prior year By September 1 of each year GRE will post on OASIS our projected Attachment O, Attachment GG, Attachment MM, and Schedule 1 including the True-Up Adjustments, associated work papers, and supplemental notes By October 31 of each year, GRE will hold an Annual Projected Rate Meeting to permit GRE to explain and clarify our projected net revenue requirement

GRE revenue requirement distribution GRE NET ATRR GRE PRICING ZONE ITCM PRICING ZONE MP NSP PRICING ZONE OTP PRICING ZONE PRICING ZONE Per Schedules 7,8, & 9 of the MISO Tariff, each Transmission Owner's total revenue requirement is allocated proportionately to each Zone in which the Transmission Owner owns transmission facilities based on the gross plant value of its facilities located in that Zone relative to the gross plant value of its facilities in all Zones, as reflected in Attachment O * Per Docket ER10-187, the gross plant value to use is transmission gross plant less the gross plant value of transmission facilities associated with Attachment GG and MM.

Rate base 2014 Projected Amount 2015 Projected Amount Rate Base Item $ Change % Change Explanation Gross Plant In Service $ 960,431,604 $ 1,077,306,524 $ 116,874,920 12.17%Remainder of Brookings and Fargo CapX projects going into service Accumulated Depreciation $ 322,572,983 $ 310,138,514 $ (12,434,469) -3.85% Net Plant In Service $ 637,858,622 $ 767,168,010 $ 129,309,388 20.27%Remainder of Brookings and Fargo CapX projects going into service 100% CWIP Recovery for Incentive Rate Transmission Projects $ 101,165,538 $ 40,815,524 $ (60,350,014) -59.65%Remainder of Brookings and Fargo CapX projects going into service AFUDC offset increasing due to remainder of CapX projects going into service Adjustments To Rate Base $ (13,256,507) $ (18,023,811) $ (4,767,304) 35.96% Land Held For Future Use 0 0 0 0 Working Capital $ 29,996,231 $ 28,950,392 $ (1,045,839) -3.49% Rate Base $ 755,763,883 $ 818,910,115 $ 63,146,231 8.36%= Net Plant + CWIP + Adjustments + LHFFU + Working Capital

Operating expenses 2014 Projected Amount 2015 Projected Amount Expense Item $ Change % Change Explanation Increasing O&M costs associated with: regulatory compliance activities (NERC), CapX capital additions, vegetation management expense O&M $ 38,190,787 $ 46,592,008 $ 8,401,221 22.00% A&G $ 10,973,064 $ 11,301,656 $ 328,592 2.99% Increasing due to remainder of CapX projects going into service Depreciation Expense $ 25,901,568 $ 26,070,575 $ 169,008 0.65% Taxes Other Than Income Taxes $ 2,226,382 $ 2,240,317 $ 13,935 0.63% Income Taxes $ - $ - $ - 0.00%GRE doesn't pay income taxes Operating Expenses $ 77,291,800 $ 86,204,556 $ 8,912,756 11.53%= O&M + A&G + Depreciation + Taxes

Rate of return 2014 Projected Amount 2015 Projected Amount Change % Change Explanation Long Term Debt 86.60% 83.82% -2.78% -3.21% GRE is working on a corporate strategy to raise our equity to 20% by 2020 Proprietary Capital 13.40% 16.18% 2.78% 20.75% Total 100% 100% = Debt + Equity Weighted Cost of Long Term Debt 4.52% 4.70% 0.18% 3.99% Weighted Cost of Proprietary Capital 1.66% 2.00% 0.34% 20.75% Rate of Return 6.18% 6.70% 0.52% 8.49%= (LT Debt * Cost) + (Equity * Cost)

Revenue requirement 2014 Projected Amount 2015 Projected Amount $ Change % Change Explanation Rate Base $ 755,763,883 $ 818,910,115 $ 63,146,231 8.36%From "Rate Base" Calculation Return $ 46,689,363 $ 54,885,110 $ 8,195,747 17.55%= Rate of Return * Rate Base Operating Expenses $ 77,291,800 $ 86,204,556 $ 8,912,756 11.53%From "Operating Expense" Calculation Attachment GG Adjustment $ (22,556,884) $ (31,752,332) $ (9,195,448) 40.77%Attachment GG Revenue Requirement Attachment MM Adjustment $ (9,983,045) $ (14,079,982) $ (4,096,937) 41.04%Attachment MM Revenue Requirement Gross Revenue Requirement $ 91,441,234 $ 95,257,351 $ 3,816,117 4.17%= Return + Operating Expenses - Adjustments Revenue Credits $ (4,005,472) $ (3,304,621) $ 700,851 -17.50% Revenue Requirement w/o True-Up $ 87,435,762 $ 91,952,730 $ 4,516,968 5.17% 2013 True-Up included in 2015 rate may change pending MISO's review. Attachment O True-Up $ 2,807,652 $ 2,851,351 $ 43,699 1.56% Net Revenue Requirement $ 90,243,415 $ 94,804,082 $ 4,560,667 5.05%= Gross Rev Req - Rev Credits + True-Up

Network rate summary $4.25 $3.75 2015 Projected Rate $3.76 2014 Projected Rate $3.71 $3.25 $0.05 Rate Increase $2.75 $/kW/Mo $2.25 $1.75 $1.25 $0.75 Return $0.27 Op Exp $0.25 Rev Cr $0.03 $0.25 True-Up $(0.01) $(0.25) MM $(0.15) GG $(0.34) $(0.75)

2015 GRE revenue requirement distribution Attachment O GRE NET ATRR $94,804,082 100% GRE PRICING ZONE $52,005,900 54.9% NSP PRICING ZONE $25,301,984 26.7% ITCM PRICING ZONE $2,920,963 3.1% MP PRICING ZONE $9,228,091 9.7% OTP PRICING ZONE $5,347,144 5.6% Attachment MM $13,824,476 Attachment GG $31,300,043 Total Attachment O, GG and MM Revenue Requirement = $139,928,601* *Inclusive of 2013 True-Up Amounts

2015 Capital additions Attachment O $31.5M Attachment GG $117.4M Attachment MM $49.5M + + = Attachment O facilities do not include excluded facilities per page 4 of Attachment O MP GRE PRICING ZONE NSP PRICING ZONE OTP PRICING ZONE ITCM PRICING ZONE PRICING ZONE $17.7M $0.8M $10.4M $2.3M $0.3M

2015 Capital additions Attachment O projects > $100K GRE Control Area Forecasted Capital Addition Project Name kV Type ISD Project ID 200229 201128 75591 200209 202975 203210 202104 82821 200208 Ortman to Big Fork 69 kV 20 mi Transmission Line Ramsey-Grand Forks (80 mi.) 230 kV Rebuild - Str. 227-307 (2) Ortman 230/69 kV Substation Wirt 69 kV 3-way motor operated switch Dickinson (S062) - 345 kV Breaker Fail/Bus Differential Replacement Dickinson - Install 345kV Line CCVT's Cromwell Distribution Switch (SS2912) Highland 3-Way Manual Load Break 1200A Tap Switch Jessie Lake 69 kV 1-way manual switch TRANS.LINE TRANS.LINE TRANS.SUBST TRANS.LINE TRANS.SUBST TRANS.SUBST TRANS.LINE TRANS.LINE TRANS.LINE 69KV 230KV 69KV 69KV 345KV 345KV 69KV 69KV 69KV 7/8/2015 3/19/2015 7/16/2015 10/8/2015 5/27/2015 5/11/2015 3/2/2015 5/27/2015 10/8/2015 GRE GRE GRE GRE GRE GRE GRE GRE GRE $7,808,783 $4,002,296 $3,643,809 $344,935 $286,149 $220,688 $176,796 $164,999 $127,047 TRANS.SUBST 203031 Heron Lake Relay Replacement 69KV 10/6/2015 ITCM $148,896 201719 50401 202118 203081 202418 203034 202450 202005 203082 202419 203122 New Market to Veseli 115kV Double Circuit (6 mi) Ravenna Distribution Substation (DEA) CDX Line - Tree Easement Reclamation Benton County - Replace Bus Diff, Add Sec Diff Elrosa Switch Upgrade 69 kV 1200A, MOD's, FLB Dickinson 115kV RTU Replacement Benton County RTU's New Market 3-Way Manual Quick Whip 115kV Sw. Hader 69 kV 3-Way Switch Replacement Grove Switch Upgrade 69 kV 1200A, FLB Miesville DA-MIT Tap Realignment TRANS.LINE TRANS.DISTSUB TRANS.LINE TRANS.SUBST TRANS.LINE TRANS.SUBST TRANS.SUBST TRANS.LINE TRANS.LINE TRANS.LINE TRANS.LINE 115/69kV 115KV 345kV 345KV 69KV 115/69kV 345KV 115/69kV 69KV 69KV 69KV 12/11/2015 3/16/2015 11/25/2015 10/16/2015 4/13/2015 12/8/2015 1/22/2015 8/21/2015 10/8/2015 10/19/2015 11/11/2015 NSP NSP NSP NSP NSP NSP NSP NSP NSP NSP NSP $6,096,047 $794,744 $669,909 $637,038 $327,756 $298,115 $258,719 $199,998 $198,154 $176,292 $122,450 202378 203007 203212 203033 203032 202444 Miltona - 115/41.6kV Spare Transformer Cormorant Jct SS2813 115 kV Switch Replacement Gorton Dist Sub - 3-Way Tap Switch Kerkhoven RTU Replacement Marsh Lake RTU Replacement Roseville Switch - Replace RTU and Transient Study TRANS.SUBST TRANS.LINE TRANS.LINE TRANS.SUBST TRANS.SUBST TRANS.SUBST 115/41.6kV 115KV 41.6KV 115/41.6kV 115/41.6kV 41.6KV 4/28/2015 10/8/2015 7/9/2015 10/27/2015 10/27/2015 4/17/2015 OTP OTP OTP OTP OTP OTP $1,102,422 $297,449 $230,000 $197,929 $197,929 $148,975

2015 Capital additions Attachment GG projects MISO Project ID 286 2634 2634 2634 Estimated ISD 05/31/15 4/10/2015 3/23/2015 6/11/2015 Forecasted Capital Addition $103,350,714 $13,060,604 $3,253,931 $679,805 Project Name CapX 2020 Monticello to Fargo 345kV Line Gowan Dist.-Cromwell 115kV Line (21mi double circuit) Savanna-Gowan Dist. 115kV Line (9mi single circuit) Cromwell Breaker Addition

2015 Capital additions Attachment MM projects MISO Project ID Estimated ISD Forecasted Capital Addition Project Name CapX 2020 - Brookings -SE Twin Cities 345KV 1203 03/31/15 $49,465,037

Budget risks Revenue Demand/weather Regulatory filings Financing Outages Timing of capital projects Tight budgets

Information exchange procedures Interested parties can submit information requests until December 1, 2014 GRE will make a good faith effort to respond within 15 business days of receipt of such requests Any information request must be submitted in writing to tbutkowski@GREnergy.com GRE will post on the MISO website and OASIS all information requests from interested parties and GRE s responses