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Year-end financial report released
Grant PUD works towards financial objectives
May 7, 2007
EPHRATA, WA – The year-end 2006 financial report on Grant PUD and its individual operating systems shows that the utility’s financial status exceeded expectations established during the 2006 annual budgeting process.
“Grant PUD is in good financial condition,” said acting Treasurer / Controller, Jim Bunch. “During 2006, utility staff made great progress toward reaching the Electric System goals of having $35 million in available working capital, which allows for short term operational flexibility, and $70 million in the utility’s reserve and contingency fund, which represents longer term stability in situations of insufficient water and/or unexpected pricing environments.”
In 2006, Grant PUD staff met the criteria of the Electric System goal for available working capital funds. In addition to reducing long-term electric system debt by $57 million on January 1, 2007, the utility reached approximately $49 million available working capital, more than $14 million above the goal of $35 million. Additionally, the utility swept $23 million into the reserve and contingency (R&C) fund in 2006 for a total of $42 million. These monies take the utility one step closer to the goal of $70 million in the R&C fund. Staff will continue work toward these objectives in 2007 and 2008.
Additionally, in 2006, the remainder of the $91.9 million in purchased power expense deferred in 2001 and 2002 was fully amortized. The balance amortized brought to a close the financial impacts experienced in the volatile energy markets during the 2001 - 2002 energy crisis period. The excess power costs incurred during the 2001 and 2002 energy crisis, $48.9 million in 2001 and $43 million in 2002, were deferred and amortized over a four year period ending in 2006. Deferring these costs enabled Grant PUD to maintain its debt service coverage ratio as specified in the Electric System’s bond covenants.
Grant PUD’s status on the bond market grew in 2006 with improved ratings from Moody’s Investors Service, Fitch and Standard & Poor’s. Positive factors over the past year include favorable progress on the federal relicensing of both Priest Rapids and Wanapum dams and the implementation of new power sales contracts with the utility’s power purchasers.
“The hard work of Grant PUD’s employees led to a solid financial performance for the utility in 2006,” said Bunch. “Each of these efforts reflects the utility’s strategic goal of maintaining a strong financial position.”
Staff reviews the utility expenditures with Commissioners on a monthly basis and provides a more extensive financial report on a quarterly basis. The audited financial reports for 2006 are available to the public and can be picked up by visiting the Grant PUD Headquarters Building in Ephrata or by contacting the Treasurer/Controller’s office.
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Grant County Public Utility District is a Washington state municipal corporation that began electric service in 1942. Owned by the people it serves, Grant PUD generates and sells electricity to Grant County residents and millions of customers throughout Central Washington and the Pacific Northwest. The Priest Rapids Project, comprised of Priest Rapids and Wanapum Dams, produces nearly 2,000 megawatts of clean, renewable and reliable electricity – enough to supply a city the size of Seattle. A leader in science based technology; Grant PUD is committed to finding effective measures for the protection, mitigation and enhancement of salmon, steelhead and other natural and cultural resources.
MEDIA CONTACT:
Sarah Morford
(509) 754-6633 / smorfor@gcpud.org |
