PR 66 05
BONNEVILLE POWER ADMINISTRATION
FOR IMMEDIATE RELEASE:
MONDAY, AUGUST 1, 2005
Contact:
Ed Mosey |
, BPA (503)-230-5131
BPA forecasts positive net revenues for 2005
PORTLAND, Ore. -
A preliminary look at the Bonneville Power Administration's bottom line for fiscal 2005 indicates the agency could hit its financial targets for the year and exceed net revenue forecasts by about $39 million - this despite low water in the Columbia Basin.
"We're overcoming adversity with a combination of hard work and good luck," said Steve Wright, BPA administrator. "Expense reductions and a very strong wholesale power market are offsetting the effects of dry weather and additional spill at dams to help salmon."
Wright cautioned that the revenue numbers, while positive, are very fragile. Water volume in the Columbia is about 75 percent of normal for the entire year, but heavy spring rains came in time to take advantage of high market prices on the West Coast. Wholesale power market prices are running two times higher than usual.
"There's still significant uncertainty surrounding water volume and a volatile energy market," Wright cautioned. "Small changes in available water or the loss of a generator could change this positive picture abruptly."
BPA's fiscal year ends Sept. 30, and the agency is in the process of deciding whether a rate adjustment is necessary. If the revenue numbers hold, they would significantly reduce the probability of an increase, BPA officials said. The forecast of modified net revenues (after certain accounting adjustments) now stands at $102 million over total expense estimated at more than $3.2 billion.
On the expense side, BPA has achieved about $50 million in power cost reductions while transmission expenses are down another $15 million, Wright said. So BPA's cost management has been a major factor in the positive outlook.
Workshops with customers and other interested parties are under way. BPA expects to make a formal rate decision for fiscal year 2006 in September. A rate adjustment, if any, would occur Oct. 1.
BPA sells surplus power in the west coast market and uses the revenue to help hold down rates for its Northwest utility customers. High natural gas prices, a tight supply picture in the West and hot weather have combined to push up wholesale prices. Natural gas is a fuel used in combustion turbine generators.
The Bonneville Power Administration markets about 45 percent of the electricity consumed in the Pacific Northwest. The power is produced at 31 federal dams in the Columbia Basin and one nuclear plant. It operates a high voltage transmission grid comprising more than 15,000 miles of lines and associated substations in Washington, Oregon, Idaho and Montana.
Submitted for distribution on 08-01-2005 at 2:37 PM
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