Prioritization of Post-JPA Initiatives Desert Southwest Region - PowerPoint PPT Presentation

Prioritization of Post-JPA Initiatives Desert Southwest Region July 31, 2019 Jim Kendrick, Vice President of Power Marketing 1

Initiatives • Organized Markets • Fiber Optic Partnerships • Combined Transmission Rate • Intertie/Parker-Davis Project Funding • Review program size • Revise Prepayment Memorandum of Understanding • Short-Term (new funding sources) • Long-Term (WAPA-wide) • Others Prioritization of Post-JPA Initiatives 2

Prioritization • Customers and DSW have limited resources to dedicate to initiatives • Based on customer interest, moving forward with combined transmission rate • Many initiatives require a comprehensive understanding of Intertie and Parker-Davis Project funding • Upcoming informational sessions on funding • How should we prioritize the remaining initiatives? Prioritization of Post-JPA Initiatives 3

Contact Information Jim Kendrick Vice President of Power Marketing kendrick@wapa.gov 602-605-2555 Linda Marianito Tribal/Customer Liaison marianito@wapa.gov 602-605-2524 Prioritization of Post-JPA Initiatives 4

Financial Discussion Desert Southwest Region Customer Meeting Phoenix, AZ July 31, 2019 Dennis R. Sullivan, CFO

Topics • Updates • Fiscal year (FY) 2019 financials • Capital appropriations • Purchase power & wheeling • Environmental funding • Financial model challenges • Symptoms of a broader problem • Shared objectives • Other topics • Financial transparency / Program collaboration • HQ 10-Year Capital Plan Meeting DSWR Customer Meeting- 1

WAPA-wide FY19 Financial Execution • Annual O&M : Forecasting full execution of $302M work plan • Appropriations : Forecasting $4M under work plan • Total Capital : Forecasting $35M under work plan • Purchase Power & Wheeling : Forecasting +$37M reserves • Return to Treasury : Forecasting $213M DSWR Customer Meeting- 3

Capital Appropriations Status DSWR Customer Meeting- 3

WAPA Capital Plan through 2025 DSWR Customer Meeting- 4

Purchase Power & Wheeling • FY18 Congressional report status • The greater of: • Actual PPW obligations in current year, or … • PPW estimate in PRS • Reserve strategy progress • FY18 reserve: $291m • FY19 projection : +$39M • FY20 budget markup: -$90M • FY20 Congressional report request • Options for new PPW account structure DSWR Customer Meeting- 5

Basin Fund – Environmental Programs Funds Transfer • Fiscal Year 2019 • OMB administrative direction to return $23M to Treasury • USBR secured appropriations • Fiscal Year 2020 • DRAFT House EWD bill • $21.4M shall be transferred to USBR • Sustainable solution? DSWR Customer Meeting- 6

Symptoms of a broader problem • “Cobbled together” legislative authorities • Not well understood • Reinterpretation risk • 100% reliant on cash • All receipts not discretionary • Alternative financing approach • No borrowing mechanism • Sub-optimal decisions • Complexity implications DSWR Customer Meeting- 7

Shared objectives DISCUSSION DSWR Customer Meeting- 8

Financial Transparency / Program Collaboration • Enhanced financial reviews • Work plans • Execution reviews • HQ 10YP • WAPA program leaders • Expanded “The Source” • Access to historical data • Technology & Security Symposium • Financial transparency vs. Programmatic insight? DSWR Customer Meeting- 9

WAPA hosts Technology WAPA HQ Ten-Year Capital Plan Technical Meeting and Security Symposium Aug. 21, 2018 Date : October 9, 2019 Time : Explore the latest trends, topics and issues 1:00 PM – 5:00 PM, MDT Location: WAPA’s Electric Power Training Center surrounding physical and cyber threats Register today! 1667 Cole Blvd. Building 19 bit.ly/WAPATechSymposium Golden, CO 80401 https://www.wapa.gov/Pages/technologysecuritysymposium.aspx Subject, Office or event CREDA Summer Meeting 2018 - 5 DSWR Customer Meeting- 10 CREDA Summer Meeting 2018 - 5

Contact/follow me Dennis Sullivan 720.962.7500 dsullivan@wapa.gov wapa.gov @westernareapowr @D_Sullivan03 Dennis Sullivan WesternAreaPower1 DSWR Customer Meeting- 11