04-05-2013 BPU RPT 05 - Laserfiche WebLink

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W A T E R F p E R G Y M 'W& RIVERSIDE PUBLIC UTILITIES Board Memorandum PUBLIC UTILITIES BOARD OF PUBLIC UTILITIES DATE: April 5,2013 ITEM NO: 5 SUBJECT: FISCAL YEAR 20112J13 POWER SUPPLY -SUPPLEMENTAL APPROPRIATION ISSUE: The item for Board of Public Utilities consideration is approval of a supplemental appropriation to the Fiscal Year 2012/13 Power Supply budget to purchase additional power supply due to higher than anticipated retail load growth and replacement power for the prolonged outage at San Onofre Nuclear Generating Station (SONGS). IIE2 MENDATIONS: That the Board of Public Utilities recommend that the City Council: 1. Authorize an increase of$4,000,000 to the Electric Fund's retail electric revenue accounts and appropriate expenditures in the same amount to the Electric Fund's Powder Supply Energy Account No. 6120100-422914; and 2. Authorize the City Manager, or his designee, to effect the necessary changes to the budget documents to enable the increased budget authority. BACKGROUND: The projected power supply budget for Fiscal Year 2012113 was originally prepared in December 2011. The Public Utilities Board's recommendations were unanimously approved on February 17, 2012, with subsequent City Council adoption of the Fiscal Year 2012113 budget on June 19, 2012. Since then, several unanticipated events have occurred resuffM in additional power supply costs. Load Growth For the first seven months of the current fiscal year, slow, but steady, economic growth has resulted in higher than expected electricity sales in all rate categories, but particularly in the industrial class. Revised revenue projections (based on the first seven months actual results) are an additional $4,000,000 in revenues for Fiscal Year 2012113. During the current fiscal year, additional power purchases are required to service the increased load demand. Although market prices continue to be favorable and some budget savings exist to fund additional purchases, supplemental appropriation is recommended to complete the fiscal year within approved budget authorizations.