Southern California Public Power Authority - SCPPAscppa.org/file.axd?file=/2016/12/FS FY 2015-2016.pdf · SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY MANAGEMENT’S DISCUSSION AND

Report of Independent Auditors and Combined Financial Statements for

Southern California Public Power Authority

June 30, 2016 and 2015

CONTENTS PAGEREPORTOFINDEPENDENTAUDITORS 1–2MANAGEMENT’SDISCUSSIONANDANALYSIS 3–9FINANCIALSTATEMENTS CombinedandCombiningfinancialstatements 10–50 Notestocombinedfinancialstatements 51–124REQUIREDSUPPLEMENTALINFORMATION ScheduleofproportionateshareofthenetpensionliabilityasofJune30,2016 125 ScheduleofcontributionsasofJune30,2016 126SUPPLEMENTALINFORMATION Supplementalscheduleofreceiptsanddisbursementsinfundsrequiredbythe bondindenturefortheyearendedJune30,2016 PaloVerdeProject 127 SanJuanProject 128 MagnoliaPowerProject 129 CanyonPowerProject 130 ApexPowerProject 131 HooverUpratingProject 132 TietonHydropowerProject 133 MilfordIWindProject 134 MilfordIIWindProject 135 WindyPointProject 136 LindenWindEnergyProject 137 SouthernTransmissionSystemProject 138 Mead‐PhoenixProject 139 Mead‐AdelantoProject 140 PinedaleProject 141 BarnettProject 142 PrepaidNaturalGasProject 143

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REPORTOFINDEPENDENTAUDITORSTheBoardofDirectorsandParticipantsofSouthernCaliforniaPublicPowerAuthorityReportonFinancialStatementsWehaveauditedtheaccompanyingcombinedandindividualprojects’financialstatementsofSouthernCaliforniaPublic Power Authority,which comprise the combined and individual projects’ statements of net position as ofJune30,2016and2015,andtherelatedcombinedandindividualprojects’statementsofrevenues,expensesandchangesinnetposition,andcashflowsfortheyearsthenended,andtherelatednotestothefinancialstatements.Management’sResponsibilityfortheFinancialStatementsManagement is responsible for thepreparationand fairpresentationof these combinedand individualprojects’financialstatementsinaccordancewithaccountingprinciplesgenerallyacceptedintheUnitedStatesofAmerica;thisincludesthedesign,implementation,andmaintenanceofinternalcontrolrelevanttothepreparationandfairpresentation of combined and individual project financial statements that are free frommaterialmisstatement,whetherduetofraudorerror.Auditor’sResponsibilityOurresponsibilityistoexpressanopiniononthesecombinedandindividualprojects’financialstatementsbasedonour audits.We conductedour audits in accordancewith auditing standards generally accepted in theUnitedStatesofAmericaandtheCaliforniaCodeofRegulations,Title2,Section1131.2,StateController’sMinimumAuditRequirementsforCaliforniaSpecialDistricts.Thosestandardsrequirethatweplanandperformtheauditstoobtainreasonable assurance about whether the combined and individual projects’ financial statements are free frommaterialmisstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in thecombinedandindividualprojects’financialstatements.Theproceduresselecteddependontheauditor’sjudgment,includingtheassessmentof therisksofmaterialmisstatementof thecombinedandindividualprojects’ financialstatements,whetherduetofraudorerror.Inmakingthoseriskassessments,theauditorconsidersinternalcontrolrelevant to the entity’s preparation and fair presentation of the combined and individual projects’ financialstatementsinordertodesignauditproceduresthatareappropriateinthecircumstances,butnotforthepurposeof expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no suchopinion.Anauditalsoincludesevaluatingtheappropriatenessofaccountingpoliciesusedandthereasonablenessof significant accounting estimates made bymanagement, as well as evaluating the overall presentation of thecombinedandindividualprojects’financialstatements.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforourauditopinion.

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REPORTOFINDEPENDENTAUDITORS(continued)OpinionsInouropinion, thecombinedand individualprojects’ financialstatementsreferred toabovepresent fairly, inallmaterialrespects,thefinancialpositionofSouthernCaliforniaPublicPowerAuthorityandeachoftheAuthority’sprojects:PaloVerdeProject,SanJuanProject,MagnoliaPowerProject,CanyonPowerProject,ApexPowerProject,HooverUpratingProject,TietonHydropowerProject,MilfordIWindProject,MilfordIIWindProject,WindyPointProject,LindenWindEnergyProject,SouthernTransmissionSystemProject,Mead‐PhoenixProject,Mead‐AdelantoProject, Pinedale Project, Barnett Project, PrepaidNatural Gas Project, Ormat Geothermal Energy Project,MWDSmall Hydro Project, Pebble Springs Wind Project, Ameresco Chiquita Landfill Gas Project, Don A. Campbell 1Geothermal Project, Copper Mountain Solar 3 Project, Columbia 2 Solar Project, Heber‐1 Geothermal Project,Kingbird SolarProject,DonA.Campbell 2GeothermalProject,ProjectDevelopmentFund,Projects’ StabilizationFund and SCPPA Fund as of June 30, 2016 and 2015, and the combined and individual results of the projects’operationsandcashflowsfortheyearsthenendedinaccordancewithaccountingprinciplesgenerallyacceptedintheUnitedStatesofAmerica.OtherMatterRequiredSupplementaryInformationAccountingprinciplesgenerallyacceptedintheUnitedStatesofAmericarequirethatthemanagement’sdiscussionandanalysis,ScheduleofProportionateShareoftheNetPensionLiabilityasofJune30,2016andtheScheduleofContributionsasofJune30,2016bepresentedtosupplementthefinancialstatements.Suchinformation,althoughnotapartofthefinancialstatements,isrequiredbytheGovernmentalAccountingStandardsBoardwhoconsidersit tobeanessentialpartof financialreportingforplacingthefinancialstatements inanappropriateoperational,economic, or historical context. We have applied certain limited procedures in the required supplementaryinformation in accordance with auditing standards generally accepted in the United States of America, whichconsisted of inquiries of management about the methods of preparing the information and comparing theinformation for consistency with management’s responses to our inquiries, the financial statements, and otherknowledgeweobtainedduringourauditofthefinancialstatements.Wedonotexpressanopinionorprovideanyassuranceontheinformationbecausethelimitedproceduresdonotprovideuswithsufficientevidencetoexpressanopinionorprovideanyassurance.OtherInformationOur audit was conducted for the purpose of forming an opinion on the financial statements as a whole. ThesupplementalschedulesofreceiptsanddisbursementsinfundsfortheyearendedJune30,2016,arepresentedforpurposesofadditionalanalysisandarenotarequiredpartofthebasicfinancialstatements.Suchinformationhasnot been subjected to the auditing procedures applied in the audit of the basic financial statements, andaccordingly,wedonotexpressanopinionorprovideanyassuranceonit.Portland,OregonOctober27,2016

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYMANAGEMENT’SDISCUSSIONANDANALYSIS

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ThefollowingdiscussionandanalysisofthefinancialperformanceofSouthernCaliforniaPublicPowerAuthority(theAuthorityorSCPPA),providesanoverviewoftheAuthority’sfinancialactivitiesforthefiscalyearsendedJune30,2016and2015.PleasereadthisdiscussionandanalysisinconjunctionwiththeAuthority’sCombinedFinancialStatements,whichbeginonpage10.DescriptionandotherdetailspertainingtotheAuthorityareincludedintheNotestoCombinedFinancialStatements.TheAuthority isa jointpowersauthoritywhoseprimarypurposehasbeen toprovide joint financingandoversight for large jointprojects for itsmemberagencies thatconsistofelevenmunicipalelectricutilitiesandoneirrigationdistrictinCalifornia.Onacombinedbasis,theseentitiesprovideelectricitytomorethantwomillionretailelectriccustomers.ABoardofDirectors(theBoard)governstheAuthority,whichconsistsofonerepresentativefromeachmemberagency.UsingThisFinancialReportThisannualfinancialreportconsistsofaseriesoffinancialstatementsandreflectstheself‐supportingactivities of the Authority that are funded primarily through the sale of energy, natural gas, andtransmissionservicestomemberagenciesunderprojectspecifictake‐or‐paycontractsthatrequireeachmemberagencytopayitsproportionateshareofoperatingandmaintenanceexpensesanddebtservicewithrespecttosuchprojects.Thecontractscannotbeterminatedoramendedinanymannerthatwillimpair or adversely affect the rights of the bondholders as long as any bonds issued by the specificprojectremainoutstanding.TheAuthorityalsoestablishedtake‐and‐paycontractsfortheparticipantsoftheprepaidnaturalgasprojectwherethepaymentsreceivedfromthesaleofgaswillbesufficienttopaydebtservice.Inaddition,theAuthorityhasenteredintovariouspowerpurchaseagreements.Theseagreementsaresubstantially take‐and‐paycontractsbut theremaybeothercostsnotassociatedwiththedeliveryofenergythattheparticipantsmaybeobligatedtopay.


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CombinedSummaryofFinancialConditionandChangesinNetPosition(inthousands)

2016 2015 2014

AssetsNetutilityplant 1,427,164$ 1,475,962$ 1,574,194$Investments 698,007 676,135 679,569Cashandcashequivalents 304,756 337,374 301,753Prepaidandother 981,133 1,030,529 1,099,682

Totalassets 3,411,060 3,520,000 3,655,198

Deferredoutflowsofresources 122,257 119,709 95,061

Totalassetsanddeferredoutflowsofresources 3,533,317$ 3,639,709$ 3,750,259$

LiabilitiesNoncurrentliabilities 3,114,994$ 3,249,181$ 3,456,473$Currentliabilities 467,032 449,772 392,473

Totalliabilities 3,582,026 3,698,953 3,848,946

Deferredinflowsofresources 242 207 ‐

NetpositionNetinvestmentincapitalassets (575,911) (594,920) (608,196)Restricted 622,340 610,915 583,618Unrestricted (95,380) (75,446) (74,109)

Totalnetposition (48,951) (59,451) (98,687)

Totalliabilities,deferredinflowsofresources,andnetposition 3,533,317$ 3,639,709$ 3,750,259$

Revenues,expensesandchangesinnetpositionfortheyearendedJune30

Operatingrevenues 851,981$ 813,095$ 702,327$Operatingexpenses (712,059) (668,880) (564,690)

Operatingincome 139,922 144,215 137,637

Investmentandotherincome 23,633 21,909 30,066Derivativegain(loss) (10,238) 28,364 395Debtexpense (132,716) (157,254) (156,729)

Changeinnetposition 20,601 37,234 11,369

Netposition,beginningofyear,beforeadjustment (59,451) (98,687) (106,999)Less:Accumulatedadjustmentforchangeinaccountingprincipal ‐ (1,004) ‐

Netposition,beginningofyear,asadjusted (59,451) (99,691) (106,999)

Netcontributions/(withdrawals)byparticipants (10,101) 3,006 (3,057)

Netposition,endofyear (48,951)$ (59,451)$ (98,687)$

June30,


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CombinedFinancialStatements(continued)NetPosition–Duringfiscalyear2016theAuthority’snetpositionincreasedby$11millionmainlyduetoadecreaseinassets and deferred outflows of resources of $106million offset by a decrease in liabilities of $117million.ThedecreaseintheAuthority’sassetsisduetothefollowing: UtilityPlant–decreasedby$49million.

This decrease is primarily due to the $116million scheduled depreciation in Generation andTransmissionProjects;and$8milliondepletion in theNaturalGasReserveProjects;offsetbythe$60millionacquisitionofadditionalinterestsintheMeadAdelanto(MA)andMeadPhoenix(MP) Projects, and $15million ongoing capital improvements in the Palo Verde Project (PV),ApexPowerProject(APP),andMagnoliaPowerProject(MPP).

Investments–increasedby$22million.This increase is largely due to $9million of proceeds from the sale of coal inventory and $9millionofadditionalbillings for thereclamationanddecommissioningof theSan JuanProject(SJ); $6 million increase in billings for the debt service requirements of the Canyon PowerProject (CPP); and $2 million of investment earnings reinvested in the PV DecommissioningTrust Fund. The increases were offset by the payment of $4 million of advances andaccumulatedoverbillingsinvariousprojects.

Cashandcashequivalents–decreasedby$33million.This decrease is mainly due to the $32 million payment of advances and accumulatedoverbillingsand$10millionoftransfersfromtheProjectStabilizationFund(PSF)forpaymentofaportionofthemonthlybillings,invariousprojects;andthereturnof$4millionofEscrowFundsrelatedtothedevelopmentoftheSpringbok1(SB1)Project.Thedecreaseswereoffsetbythe$3millionmembers’contributionsforthefutureacquisitionofthenewSCPPABuilding;$8millionofadditionaloperatingcostsbilledforthreenewprojects–DonA.Campbell2(DAC2),KingbirdSolar (KBS)and theHeber‐1Geothermal (Heber‐1); and the$2millionof additionalfundsdepositedintheProjectDevelopmentFund(PDF)fortheongoingdevelopmentoftheSB1Project.

Prepaidandotherassets–decreasedby$49million.This decrease is primarily due to the $59million amortizations of the prepaid assets in theNaturalGasPrepaidProject(NGPP),Milford1,MilfordII,andWindyPoint/WindyFlatsProject(WindyPoint);offsetby$8millionofswapcollateralreceivableandthereturnof$2millionofsparepartsfromGEintheMPP.


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CombinedFinancialStatements(continued)

Deferredoutflowsofresources–increasedby$2million.The increase is largely due to the $14 million increase in the fair values of the derivativeinstruments in the MPP and NGPP Projects; offset by $12 million amortizations of loss onrefundinginvariousdebt‐fundedProjects.

Liabilities–ThedecreaseintheAuthority’sliabilitiesof$117millionisprimarilyduetothefollowing:

$209millionofprincipalmaturitiesandrelatedamortizationsforalldebt‐fundedprojects;and$3 million net decrease in advances and deferred credits in the CPP and PV Project. Thedecreaseswereoffsetbythe$50millionissuanceofthe2016AMA(LADWP)andMP(LADWP)Revenue Bonds at a premium of $11million; $7million of bond premium received from theissuance of the CPP 2016A Refunding Revenue Bonds; and $27 million net increase in thereportedchangeinfairvalueofthederivativeinstruments.

During fiscal year 2015, the Authority’s assets and deferred outflow of resources decreased by $111million mainly due to the scheduled depreciation in the generation and transmission projects anddepletion inthenaturalgasreservesprojects;offsetby the$151milliondecrease in liabilities largelydue to the terminationof theSTS2000Swap inFY2015;and the scheduledprincipalmaturitiesandrelatedamortizationsforalldebtrelatedprojects;resultinginanincreaseintheAuthority’snetpositionof$40million.Operatingincome–The net decrease in operating income of $4 million is mainly due to the $10 million increase indecommissioningexpenseinthePVProjectrelatedtotheescalationrateofSCPPA’sprojectedfundingtermination costs and to the20‐year extension of the life of the utility plant; thedecrease in billingsbecauseofthereceiptof$9millionfromthesaleofcoalinventoryintheSJProjectandthereleaseof$3millionofdebtservicereservesforthefinaldebtservicerequirementsoftheMPP2006ABonds;and$2millionoftestenergycostsaccruedinthePSFfortheupcomingSpringbokProjects.Thedecreaseswereoffsetby$16millionnetincreaseinbillingsfordebtservicerequirementsintheCPPandSTSProjectsand for operation expense in the PV Project; and $4 million of Turbine Warranty in the WindyPoint/WindyFlatsProject(WindyPoint)thatwasfullyamortizedinFY2015.DuringFY2015,thenetincreaseof$7millionisduetothe$7millionincreaseinparticipants’billingsforearlydebtretirementandthereceiptof$13millioninfire insurancesettlements intheSJProject;offsetby$7milliondecreaseinparticipants’billingsintheSTSProjectduetothereleaseoftheunusedbondproceedsforthefinaldebtservicerequirementsoftheSTS2008BBondsinFY2015.


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CombinedFinancialStatements(continued)InvestmentandOtherIncome–Investmentandother income increased$2millionprimarilydue to thereceiptof$7million fromthesaleofcoalinventoryintheSJProjectoffsetbythe$3millionreceivedfortheFERCRatesettlementintheApexProjectandthe$2millionSpentFuelSettlementreceivedfromtheDOEforthePVProjectinFY2015.DerivativeGain(Loss)–In June 2008, GASB issued Statement No 53, Accounting and Financial Reporting for DerivativeInstruments, effective for financial statements for periods beginning after June 15, 2009. GASB 53requires that the fair value of derivative instruments be reported in the financial statements asinvestmentincomeorlossifthederivativefailstoeffectivelyhedgetheriskofrisingorfallingcashflowsor fair values. $10.2 million and $28.4 million were charged to expense and income related to theAuthority’sderivative instrumentsthatweredeemedinvestment instrumentsasof June30,2016and2015,respectively.The$38.6millionderivativelossismainlyduetoterminationoftheSTS2000SwapsinFY2015and$10.6milliondecreaseinthevaluationoftheMagnoliaSwapsbecauseoftherecentfallininterestrates.(SeeNote5).SCPPA has three basis swaps that make variable payments based on SIFMA and receive variablepaymentsbasedonapercentageofLIBOR.TheirpurposeistoreducetheinterestexpenseontheMead‐AdelantoProject,andtheMagnoliaPowerProjectBonds.PursuanttoGASB53,thereisnoidentifiedriskbeing hedged by a basis swap, and therefore they are all deemed investment instruments. Theseinvestmentinstrumentswerestrategicallyplacedbymanagementtoreduceinterestexpenseandtheycontinuetoservethispurpose.GASB53outlinesanumberofteststobeperformedonaswapateachreportingperiodtoqualifyasaneffective hedge. Once a swap becomes ineffective on a reporting date, it is deemed an investmentinstrument then and going forward. GASB 53 does not allow a swap to qualify again regardless ofperformance, unless associatedwith new bonds.While theMagnolia 2009‐2 Swap has been deemedtechnically ineffective, and therefore an investment instrument since FY 2012, management stillassociatesitwiththeMagnoliaBondsitwasoriginallyhedginganditcontinuestofunctionaccordingly.DebtExpense–Debt expense decreased by $24 million largely due to the decrease in interest expense and relatedamortizationsfromtherefundingoftheSJ2005A,theSTS2000AandSTS2008BBondsinFY2015;andthefinalmaturityoftheMAandMP1994BondsonJuly1,2015.


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Financialoutlook–TheAuthority’screditstrengthisbasedonanumberoffactorsincluding: Thecollectivecreditstrengthsofeachprojectparticipant; ThelowcostpowertheProjectsprovidetheparticipants;and

Stronglegalprovisions.TheAuthorityhas take‐or‐paypower sales, natural gas sales, and transmission service contracts thatunconditionallyrequire theParticipants topay for thecostofoperatingandmaintaining theProjects,includingdebt service,whetherornot theProjects areoperatingor operable.Although the contractshavenotbeencourt‐tested,amunicipalutility’sauthoritytoenter intosuchcontracts isrootedintheState’sconstitutionalprovisionsformunicipalelectricutilities.TheParticipantsofthePrepaidNaturalGas Project, however, are obligated only to purchase and pay for gas delivered by SCPPA atmarket‐basedpricesinaccordancewiththeprepaidgassaleagreementsintake‐and‐paycontracts.TheAuthorityhasalsoenteredintovariouspowerpurchaseagreementsthataresubstantiallytake‐and‐pay contracts but there may be other costs not associated with the delivery of energy that theparticipantsmaybeobligatedtopay.Through the collaborative efforts of itsmembers, the Authority has developed a comprehensive anddynamicstrategicplanthatprovidesacommonvisionforitsmembersandaplatformforjointaction.SCPPAcontinuesitsinvolvementinlegislativeandregulatoryaffairsatboththestateandfederallevelsto protect represented customers, by assuring resource adequacy, excellent reliability, andenvironmental stewardship. Backed by one of the strongest financial ratings in the utility industry,SCPPAmaintainsitstraditionalroleofprovidingfinancingforitsmembers’naturalgas,generation,andtransmissionprojects.Inadditiontotheconventionalareasofpower,investmentsarealsobeingmadetoprovidecustomerswithmorerenewablegenerationandenergyefficiency.AB 1890 required all California electric utilities to commit a portion of their revenue to other PublicBenefit Programs, including energy efficiency, renewable energy, research, development anddemonstration (RD&D), and low‐income customer assistance. Since 1998, a combined $2.0 billiondollars have been spent by SCPPAmembers on their respective Public Benefits Programs to supportlocalcommunities.Renewableprojects–Memberagencies’electricutilitiesaregovernedbytheirrespectivecitycouncilsor other elected legislative bodies.Many ofwhompreviously established voluntary targets includinggoalsforthepercentageofrenewableenergytheywishtoobtainwithintheirportfolios.Somehavesettargets ashigh as40%by the year2020.Manymembers are approaching, orhave already exceededtheir interimtargetsof25%renewableenergyandarenowupdatingtheirobjectivestomeet33%by2020 as required by SBX1 2. In addition, the passage of SB350 has added a new 50% renewableportfoliostandardtargetfor2030.


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SCPPA continues to seek cost effective resources to supportmembers’ Renewable Portfolio Standard(RPS)objectivesfor2016andbeyond.SCPPAhasanactiveworkinggroupfocusedonrenewableenergydevelopment. This group,with representation from all twelve of themember agencies, has reviewedovertwelvehundred(1200)individualprojectproposalssincestartingin2007.Manyoftheseprojectshave advanced into specific contract negotiations, and over 1,700 MW of capacity are now indevelopmentoroperatinginsupportofmembers’renewableobjectives.Adoptionofnewaccountingstandard– InFebruary2015, theGASB issuedStatementNo. 72,FairValueMeasurementandApplication,effectiveforfinancialstatementsforyearsbeginningafterJune15,2015.SCPPA implemented this statementduring fiscalyear2016andreports itsassetsand liabilitiesaccordingly.GASB72clarifies thedefinitionof fairvalue,establishesgeneralprinciples formeasuringfairvalue,providesadditionalfairvalueapplicationguidance,andenhancesdisclosuresaboutfairvaluemeasurements.FairValueisdefinedinStatement72asthepricethatwouldbereceivedtosellanassetorpaidtotransferaliabilityinanorderlytransactionbetweenmarketparticipantsatthemeasurementdate(anexitprice).Thisstatementalsoestablishesathree‐levelhierarchytothevaluationtechniquesusedtomeasurefairvalueandsetsforththerequireddisclosureforfairvaluemeasurements,theleveloffairvaluehierarchy,andadescriptionofthevaluationtechniquesormethodsusedfordeterminingrecurring fair valuemeasurements. The Fair Values of SCPPA’s derivative instruments for fiscal year2015werenotrestatedasitwasdeterminedthatitwasnotpracticalormaterialtodoso.(SeeNote6)SummaryThe management of the Authority is responsible for preparing the information in this managementdiscussionandanalysis,combinedandindividualprojects’financialstatements,andnotestocombinedfinancial statements. The financial statements were prepared according to accounting principlesgenerally accepted in the United States of America, and they fairly portray the Authority’s financialposition andoperating results. Thenotes to the financial statements are an integral part of the basicfinancialstatementsandprovideadditionalfinancialinformation.

10 Seeaccompanyingnotes.

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCOMBINEDSTATEMENTSOFNETPOSITION(AMOUNTSINTHOUSANDS)

2016 2015

NoncurrentassetsNetutilityplant 1,427,164$ 1,475,962$Investments–restricted 636,201 631,010Investments–unrestricted 61,806 45,125AdvancetoIPA‐restricted 11,550 11,550Advancesforcapacityandenergy,net–restricted 404 2,036Fairvalueofderivativeinstruments 3,731 2,229Prepaidandotherassets 849,731 909,230

Totalnoncurrentassets 2,990,587 3,077,142

CurrentassetsCashandcashequivalents–restricted 235,743 236,950Cashandcashequivalents–unrestricted 69,013 100,424Interestreceivable 995 1,278Accountsreceivable 22,148 11,673Materialsandsupplies 26,155 25,909Prepaidandotherassets 66,419 66,624

Totalcurrentassets 420,473 442,858

Deferreditemsrelatedtopensions 440 353Unamortizedlossonrefunding 83,848 96,202Accumulateddecreaseinfairvalueofhedgingderivatives 37,969 23,154

Totaldeferredoutflowsofresources 122,257 119,709

Totalassetsanddeferredoutflowsofresources 3,533,317$ 3,639,709$

NoncurrentliabilitiesLong‐termdebt 3,025,767$ 3,176,756$Fairvalueofderivativeinstruments 63,413 36,857Notespayable,netpensionandotherliabilities 1,603 9,118Advancesfromparticipants 24,211 26,450

Totalnoncurrentliabilities 3,114,994 3,249,181

CurrentliabilitiesDebtduewithinoneyear 191,730 181,710Notespayableandotherliabilitiesduewithinoneyear 25,472 20,480Advancesfromparticipantsduewithinoneyear 73,003 45,634Accruedinterest 61,906 63,301Accountspayableandaccruals 110,731 133,067Accruedpropertytax 4,190 5,580

Totalcurrentliabilities 467,032 449,772

Totalliabilities 3,582,026 3,698,953

Deferreditemsrelatedtopensions 242 207

Totaldeferredinflowsofresources 242 207

NETPOSITIONNetinvestmentincapitalassets (575,911) (594,920)Restricted 622,340 610,915Unrestricted (95,380) (75,446)

Totalnetposition (48,951) (59,451)

Totalliabilities,deferredinflowsofresourcesandnetposition 3,533,317$ 3,639,709$

ASSETS

LIABILITIES

June30,

DEFERREDOUTFLOWSOFRESOURCES

DEFERREDINFLOWSOFRESOURCES

Seeaccompanyingnotes. 11

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITY

COMBINEDSTATEMENTSOFREVENUES,EXPENSES,ANDCHANGESINNETPOSITION

(AMOUNTSINTHOUSANDS)

2016 2015

OperatingrevenuesSalesofelectricenergy 665,550$ 628,515$Salesoftransmissionservices 146,281 140,541Salesofnaturalgas 40,150 44,039

Totaloperatingrevenues 851,981 813,095

OperatingexpensesOperationsandmaintenance 569,581 537,216Depreciation,depletionandamortization 106,526 106,590Amortizationofnuclearfuel 14,653 14,493Decommissioning 21,214 10,857Pensionexpense(credit) 85 (276)

Totaloperatingexpenses 712,059 668,880

Operatingincome 139,922 144,215

Nonoperatingrevenues(expenses)Investmentandotherincome 23,633 21,909Derivativegain (10,238) 28,364Debtexpense (132,716) (157,254)

Netnonoperatingrevenues(expenses) (119,321) (106,981)

Changeinnetposition 20,601 37,234

Netposition–beginningofyear (59,451) (99,691)

Netcontributions(distributions)byparticipants (10,101) 3,006

Netposition–endofyear (48,951)$ (59,451)$

YearsEndedJune30,


SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCOMBINEDSTATEMENTSOFCASHFLOWS(AMOUNTSINTHOUSANDS)

2016 2015

CashflowsfromoperatingactivitiesReceiptsfromparticipants 740,724$ 700,656$Receiptsfromsaleofoilandgas 1,117 16,286Paymentstooperatingmanagers (408,433) (350,001)Otherdisbursementsandreceipts 15,753 17,376

Netcashflowsfromoperatingactivities 349,161 384,317

CashflowsfromnoncapitalfinancingactivitiesAdvancesbyparticipants,net (7,675) 1,590

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net (97,157) (34,316)Debtinterestpayments (136,666) (143,210)Proceedsfromsaleofbonds 154,562 316,095Paymentfordefeasanceofrevenuebonds (92,261) (349,670)Transferoffundsfrom(to)MineReclamationTrustFund (3,760) (420)Principalpaymentsondebt (181,710) (122,520)Paymentforbondissuecosts (1,252) (24,150)

Netcashusedforcapitalandrelatedfinancingactivities (358,244) (358,191)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 4,913 5,294Purchasesofinvestments (655,558) (425,834)Proceedsfromsale/maturityofinvestments 634,785 428,445

Netcashfrominvestingactivities (15,860) 7,905

Netchangeincashandcashequivalents (32,618) 35,621

Cashandcashequivalents,beginningofyear 337,374 301,753

Cashandcashequivalents,endofyear 304,756$ 337,374$

Reconciliationofoperatingincometonetcashprovidedbyoperatingactivities

Operatingincome 139,922$ 144,215$Adjustmentstoreconcileoperatingincometonetcashprovided

byoperatingactivitiesDepreciation,depletionandamortization 106,526 158,745Decommissioning 19,507 10,857Advancesforcapacityandenergy 2,480 2,550Amortizationofnuclearfuel 63,307 14,493Pensionexpense 85 (276)

ChangesinassetsandliabilitiesAccountsreceivable (10,700) 4,481Accountspayableandaccruals (5,183) 33,764Other 33,217 15,488

Netcashprovidedbyoperatingactivities 349,161$ 384,317$

CashandcashequivalentsasstatedintheCombinedStatementsofNetPosition

Cashandcashequivalents–restricted 235,743$ 236,950$Cashandcashequivalents–unrestricted 69,013 100,424

304,756$ 337,374$

YearsEndedJune30,

Thispageintentionallyleftblank.


SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCOMBININGSTATEMENTSOFNETPOSITIONJUNE30,2016(AMOUNTSINTHOUSANDS)

PaloVerde SanJuan MagnoliaPower CanyonPower ApexPower

NoncurrentassetsNetutilityplant 34,955$ 53,190$ 199,697$ 239,046$ 269,632$Investments–restricted 196,774 26,797 52,802 31,128 38,184Investments–unrestricted 25,657 20,870 ‐ ‐ ‐AdvancetoIPA–restricted ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐Prepaidandotherassets ‐ 747 ‐ ‐ ‐

Totalnoncurrentassets 257,386 101,604 252,499 270,174 307,816

CurrentassetsCashandcashequivalents–restricted 14,523 674 32,884 10,717 10,068Cashandcashequivalents–unrestricted 7,314 2,080 3,118 651 726Interestreceivable 324 35 329 45 23Accountsreceivable 2,338 ‐ 8,620 378 ‐Materialsandsupplies 10,202 2,573 9,162 1,116 3,102Prepaidandotherassets 847 1,508 1,432 7 762

Totalcurrentassets 35,548 6,870 55,545 12,914 14,681

Unamortizedlossonrefunding ‐ ‐ 10,474 6,242 ‐Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ 24,797 ‐ ‐

Totaldeferredoutflowsofresources ‐ ‐ 35,271 6,242 ‐

Totalassetsanddeferredoutflowsofresources 292,934$ 108,474$ 343,315$ 289,330$ 322,497$

NoncurrentliabilitiesLong‐termdebt 12,410$ ‐$ 306,949$ 306,876$ 313,479$Fairvalueofderivativeinstruments ‐ ‐ 50,241 ‐ ‐Notespayableandotherliabilities ‐ ‐ ‐ ‐ ‐Advancesfromparticipants ‐ ‐ ‐ ‐ ‐

Totalnoncurrentliabilities 12,410 ‐ 357,190 306,876 313,479

CurrentliabilitiesDebtduewithinoneyear 12,030 21,345 11,470 6,735 9,375Notespayableandotherliabilitiesduewithinoneyear 7,047 ‐ 17,797 ‐ ‐Advancesfromparticipantsduewithinoneyear ‐ 23,346 27,106 2,225 ‐Accruedinterest 5 84 3,433 7,150 6,284Accountspayableandaccruals 22,706 4,640 3,111 2,698 3,337Accruedpropertytax 1,650 366 ‐ ‐ ‐

Totalcurrentliabilities 43,438 49,781 62,917 18,808 18,996

Totalliabilities 55,848 49,781 420,107 325,684 332,475

NETPOSITIONNetinvestmentincapitalassets 10,515 11,996 (108,248) (64,131) (26,220)Restricted 204,545 24,672 51,837 28,264 14,976Unrestricted 22,026 22,025 (20,381) (487) 1,266

Totalnetposition 237,086 58,693 (76,792) (36,354) (9,978)

Totalliabilitiesandnetposition 292,934$ 108,474$ 343,315$ 289,330$ 322,497$

ASSETS

LIABILITIES


GENERATION



COMBININGSTATEMENTSOFNETPOSITIONJUNE30,2015


PaloVerde SanJuan MagnoliaPower CanyonPower ApexPower

NoncurrentassetsNetutilityplant 60,006$ 64,103$ 209,944$ 248,624$ 279,522$Investments–restricted 189,229 11,975 52,576 22,718 37,981Investments–unrestricted 23,742 ‐ ‐ ‐ ‐AdvancetoIPA–restricted ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐Prepaidandotherassets ‐ 739 ‐ ‐ ‐

Totalnoncurrentassets 272,977 76,817 262,520 271,342 317,503

CurrentassetsCashandcashequivalents–restricted 22,159 15,075 29,108 11,299 16,667Cashandcashequivalents–unrestricted 11,616 5,913 7,930 650 17,440Interestreceivable 487 20 246 46 3Accountsreceivable 2,226 376 355 87 ‐Materialsandsupplies 10,326 4,880 7,146 1,091 2,466Prepaidandotherassets 737 1,434 1,306 44 741

Totalcurrentassets 47,551 27,698 46,091 13,217 37,317

Unamortizedlossonrefunding ‐ 74 11,687 ‐ ‐Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ 13,272 ‐ ‐

Totaldeferredoutflowsofresources ‐ 74 24,959 ‐ ‐

Totalassetsanddeferredoutflowsofresources 320,528$ 104,589$ 333,570$ 284,559$ 354,820$

NoncurrentliabilitiesLong‐termdebt 24,440$ 21,345$ 319,423$ 307,987$ 323,602$Fairvalueofderivativeinstruments ‐ ‐ 26,975 ‐ ‐Notespayableandotherliabilities 7,024 ‐ ‐ ‐ ‐Advancesfromparticipants ‐ ‐ ‐ ‐ ‐

Totalnoncurrentliabilities 31,464 21,345 346,398 307,987 323,602

CurrentliabilitiesDebtduewithinoneyear 11,690 21,590 10,985 ‐ 9,335Notespayableandotherliabilitiesduewithinoneyear 6,700 ‐ 13,152 ‐ ‐Advancesfromparticipantsduewithinoneyear ‐ 9,332 17,796 2,225 ‐Accruedinterest 3 181 3,599 8,366 6,305Accountspayableandaccruals 21,629 5,409 5,330 422 23,434Accruedpropertytax 1,650 372 ‐ ‐ ‐

Totalcurrentliabilities 41,672 36,884 50,862 11,013 39,074

Totalliabilities 73,136 58,229 397,260 319,000 362,676

NETPOSITIONNetinvestmentincapitalassets 23,876 15,399 (108,777) (55,124) (22,315)Restricted 185,497 24,139 55,914 19,233 18,490Unrestricted 38,019 6,822 (10,827) 1,450 (4,031)

Totalnetposition 247,392 46,360 (63,690) (34,441) (7,856)

Totalliabilitiesandnetposition 320,528$ 104,589$ 333,570$ 284,559$ 354,820$

ASSETS

LIABILITIES


GENERATION



HooverUprating

TietonHydropower

MilfordIWind

MilfordIIWind WindyPoint

LindenWindEnergy

NoncurrentassetsNetutilityplant ‐$ 38,942$ ‐$ ‐$ ‐$ 112,843$Investments–restricted 3,461 4,997 25,813 8,227 23,592 5,999Investments–unrestricted ‐ ‐ ‐ 3,793 2,498 ‐AdvancetoIPA–restricted ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted 404 ‐ ‐ ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets ‐ ‐ 141,133 123,194 362,043 ‐

Totalnoncurrentassets 3,865 43,939 166,946 135,214 388,133 118,842

CurrentassetsCashandcashequivalents–restricted 376 2,570 12,642 4,343 17,324 5,328Cashandcashequivalents–unrestricted 718 564 5,279 1,845 4,135 660Interestreceivable 1 9 18 13 37 ‐Accountsreceivable ‐ 137 ‐ ‐ ‐ ‐Materialsandsupplies ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets 1,636 22 11,410 8,699 27,941 131

Totalcurrentassets 2,731 3,302 29,349 14,900 49,437 6,119

Unamortizedlossonrefunding ‐ ‐ ‐ ‐ ‐ ‐

Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐ ‐ ‐ ‐

Totaldeferredoutflowsofresources ‐ ‐ ‐ ‐ ‐ ‐

Totalassetsanddeferredoutflowsofresources 6,596$ 47,241$ 196,295$ 150,114$ 437,570$ 124,961$

NoncurrentliabilitiesLong‐termdebt 2,141$ 48,997$ 194,400$ 141,967$ 437,630$ 123,062$Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐Notespayableandotherliabilities ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipants ‐ ‐ ‐ ‐ ‐ ‐

Totalnoncurrentliabilities 2,141 48,997 194,400 141,967 437,630 123,062

CurrentliabilitiesDebtduewithinoneyear 2,030 870 9,175 5,795 20,145 3,820Notespayableandotherliabilitiesduewithin

oneyear ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipantsduewithinoneyear ‐ 202 250 250 1,000 2,004Accruedinterest 55 1,244 4,849 3,535 10,449 3,169Accountspayableandaccruals 59 376 4,997 5,367 5,452 637Accruedpropertytax ‐ ‐ ‐ ‐ 676 239

Totalcurrentliabilities 2,144 2,692 19,271 14,947 37,722 9,869

Totalliabilities 4,285 51,689 213,671 156,914 475,352 132,931

NETPOSITIONNetinvestmentincapitalassets ‐ (10,925) ‐ ‐ ‐ (14,040)Restricted 723 6,331 ‐ ‐ ‐ 8,159Unrestricted 1,588 146 (17,376) (6,800) (37,782) (2,089)

Totalnetposition 2,311 (4,448) (17,376) (6,800) (37,782) (7,970)

Totalliabilitiesandnetposition 6,596$ 47,241$ 196,295$ 150,114$ 437,570$ 124,961$

ASSETS

LIABILITIES

GREENPOWER






HooverUprating

TietonHydropower

MilfordIWind


LindenWindEnergy

NoncurrentassetsNetutilityplant ‐$ 39,752$ ‐$ ‐$ ‐$ 118,656$Investments–restricted 3,136 4,956 26,267 3,249 21,293 2,303Investments–unrestricted 560 ‐ 2,502 2,823 3,003 1,501AdvancetoIPA‐restricted ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted 2,036 ‐ ‐ ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets ‐ ‐ 152,534 131,890 389,492 ‐

Totalnoncurrentassets 5,732 44,708 181,303 137,962 413,788 122,460

CurrentassetsCashandcashequivalents–restricted 89 2,554 11,855 9,199 19,228 7,988Cashandcashequivalents–unrestricted 792 579 1,944 2,403 5,977 223Interestreceivable 1 13 56 14 51 ‐Accountsreceivable ‐ ‐ ‐ ‐ ‐ 129Materialsandsupplies ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets 1,667 408 11,410 8,706 27,962 10

Totalcurrentassets 2,549 3,554 25,265 20,322 53,218 8,350

Unamortizedlossonrefunding ‐ ‐ ‐ ‐ ‐ ‐Accumulateddecreaseinfairvalueofhedging

derivatives ‐ ‐ ‐ ‐ ‐ ‐

Totaldeferredoutflowsofresources ‐ ‐ ‐ ‐ ‐ ‐

Totalassetsanddeferredoutflowsofresources 8,281$ 48,262$ 206,568$ 158,284$ 467,006$ 130,810$

NoncurrentliabilitiesLong‐termdebt 4,181$ 49,931$ 204,704$ 149,610$ 463,114$ 127,753$Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐Notespayableandotherliabilities ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipants ‐ ‐ ‐ ‐ ‐ ‐

Totalnoncurrentliabilities 4,181 49,931 204,704 149,610 463,114 127,753

CurrentliabilitiesDebtduewithinoneyear 1,930 840 8,820 5,530 19,390 3,670Notespayableandotherliabilitiesduewithin

oneyear ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipantsduewithinoneyear ‐ 202 250 250 1,000 2,004Accruedinterest 80 1,259 5,025 3,665 10,828 3,242Accountspayableandaccruals 121 640 4,165 4,961 7,452 759Accruedpropertytax ‐ ‐ ‐ ‐ 727 258

Totalcurrentliabilities 2,131 2,941 18,260 14,406 39,397 9,933

Totalliabilities 6,312 52,872 222,964 164,016 502,511 137,686

NETPOSITIONNetinvestmentincapitalassets ‐ (11,019) ‐ ‐ ‐ (12,767)Restricted 723 6,264 ‐ ‐ ‐ 7,182Unrestricted 1,246 145 (16,396) (5,732) (35,505) (1,291)

Totalnetposition 1,969 (4,610) (16,396) (5,732) (35,505) (6,876)

Totalliabilitiesandnetposition 8,281$ 48,262$ 206,568$ 158,284$ 467,006$ 130,810$

GREENPOWER

ASSETS

LIABILITIES




SouthernTransmissionSystem Mead‐Phoenix Mead‐Adelanto

NoncurrentassetsNetutilityplant 216,259$ 55,634$ 115,269$Investments–restricted 41,155 2,300 17,497Investments–unrestricted ‐ ‐ ‐AdvancetoIPA–restricted 11,550 ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ 3,731Prepaidandotherassets ‐ ‐ ‐

Totalnoncurrentassets 268,964 57,934 136,497

CurrentassetsCashandcashequivalents–restricted 50,283 4,327 10,896Cashandcashequivalents–unrestricted 2,992 488 650Interestreceivable 25 ‐ 11Accountsreceivable 4,632 273 ‐Materialsandsupplies ‐ ‐ ‐Prepaidandotherassets 40 8 12

Totalcurrentassets 57,972 5,096 11,569

Unamortizedlossonrefunding 62,231 1,269 3,632Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐

Totaldeferredoutflowsofresources 62,231 1,269 3,632

Totalassetsanddeferredoutflowsofresources 389,167$ 64,299$ 151,698$

NoncurrentliabilitiesLong‐termdebt 603,434$ 50,656$ 112,098$Fairvalueofderivativeinstruments ‐ ‐ ‐Notespayableandotherliabilities ‐ ‐ 592Advancesfromparticipants ‐ ‐ ‐

Totalnoncurrentliabilities 603,434 50,656 112,690

CurrentliabilitiesDebtduewithinoneyear 53,650 5,515 17,985Notespayableandotherliabilitiesduewithinoneyear ‐ ‐ 628Advancesfromparticipantsduewithinoneyear ‐ ‐ ‐Accruedinterest 14,041 657 2,226Accountspayableandaccruals 11,076 482 1,113Accruedpropertytax ‐ ‐ ‐

Totalcurrentliabilities 78,767 6,654 21,952

Totalliabilities 682,201 57,310 134,642

NETPOSITIONNetinvestmentincapitalassets (377,780) (537) (12,041)Restricted 88,158 7,239 26,179Unrestricted (3,412) 287 2,918

Totalnetposition (293,034) 6,989 17,056

Totalliabilitiesandnetposition 389,167$ 64,299$ 151,698$

TRANSMISSION

ASSETS

LIABILITIES






SouthernTransmissionSystem Mead‐Phoenix Mead‐Adelanto

NoncurrentassetsNetutilityplant 239,013$ 30,006$ 86,741$Investments–restricted 48,904 2,900 14,397Investments–unrestricted ‐ ‐ ‐AdvancetoIPA–restricted 11,550 ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ 2,229Prepaidandotherassets ‐ ‐ ‐


CurrentassetsCashandcashequivalents–restricted 40,466 2,358 12,098Cashandcashequivalents–unrestricted 4,983 2,319 2,062Interestreceivable 22 ‐ 1Accountsreceivable 4,438 ‐ 48Materialsandsupplies ‐ ‐ ‐Prepaidandotherassets 20 123 12


Unamortizedlossonrefunding 78,315 1,586 4,540Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐

Totaldeferredoutflowsofresources 78,315 1,586 4,540


NoncurrentliabilitiesLong‐termdebt 667,654$ 29,730$ 99,570$Fairvalueofderivativeinstruments ‐ ‐ ‐Notespayableandotherliabilities ‐ ‐ 1,220Advancesfromparticipants ‐ ‐ ‐


CurrentliabilitiesDebtduewithinoneyear 53,085 5,480 17,690Notespayableandotherliabilitiesduewithinoneyear ‐ ‐ 628Advancesfromparticipantsduewithinoneyear ‐ ‐ ‐Accruedinterest 12,565 693 2,537Accountspayableandaccruals 12,901 752 688Accruedpropertytax ‐ ‐ ‐



NETPOSITIONNetinvestmentincapitalassets (407,143) (6,105) (27,828)Restricted 92,114 5,556 23,688Unrestricted (3,465) 3,186 3,935

Totalnetposition (318,494) 2,637 (205)


TRANSMISSION

ASSETS

LIABILITIES




Pinedale Barnett PrepaidNaturalGas

NoncurrentassetsNetutilityplant 40,988$ 46,440$ ‐$Investments–restricted 1,100 31,908 11,739Investments–unrestricted ‐ ‐ ‐AdvancetoIPA–restricted ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐Prepaidandotherassets 126 ‐ 222,488


CurrentassetsCashandcashequivalents–restricted 4,104 9,769 4,742Cashandcashequivalents–unrestricted 5,929 1,502 56Interestreceivable 1 14 49Accountsreceivable 497 282 1,452Materialsandsupplies ‐ ‐ ‐Prepaidandotherassets 512 2 11,306


Unamortizedlossonrefunding ‐ ‐ ‐Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ 13,172

Totaldeferredoutflowsofresources ‐ ‐ 13,172


NoncurrentliabilitiesLong‐termdebt 20,240$ 47,570$ 303,858$Fairvalueofderivativeinstruments ‐ ‐ 13,172Notespayableandotherliabilities ‐ ‐ ‐Advancesfromparticipants 16,537 7,674 ‐


CurrentliabilitiesDebtduewithinoneyear 2,249 5,266 4,275Notespayableandotherliabilitiesduewithinoneyear ‐ ‐ ‐Advancesfromparticipantsduewithinoneyear 4,933 1,386 ‐Accruedinterest 636 1,496 2,593Accountspayableandaccruals 2,225 1,650 695Accruedpropertytax 1,259 ‐ ‐



NETPOSITIONNetinvestmentincapitalassets 401 12,935 ‐Restricted 1,831 11,804 ‐Unrestricted 2,946 136 (59,589)

Totalnetposition 5,178 24,875 (59,589)


NATURALGAS

ASSETS

LIABILITIES






Pinedale Barnett PrepaidNaturalGas

NoncurrentassetsNetutilityplant 44,625$ 50,710$ ‐$Investments–restricted ‐ 31,187 11,586Investments–unrestricted ‐ ‐ ‐AdvancetoIPA–restricted ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐Prepaidandotherassets 126 ‐ 234,449


CurrentassetsCashandcashequivalents–restricted 4,607 11,117 4,399Cashandcashequivalents–unrestricted 4,696 1,264 77Interestreceivable ‐ 48 55Accountsreceivable 1,497 626 1,459Materialsandsupplies ‐ ‐ ‐Prepaidandotherassets 679 10 11,335


Unamortizedlossonrefunding ‐ ‐ ‐Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ 9,882

Totaldeferredoutflowsofresources ‐ ‐ 9,882


NoncurrentliabilitiesLong‐termdebt 22,489$ 52,836$ 308,387$Fairvalueofderivativeinstruments ‐ ‐ 9,882Notespayableandotherliabilities ‐ ‐ ‐Advancesfromparticipants 17,898 8,552 ‐


CurrentliabilitiesDebtduewithinoneyear 2,274 5,326 4,075Notespayableandotherliabilitiesduewithinoneyear ‐ ‐ ‐Advancesfromparticipantsduewithinoneyear 1,964 1,218 ‐Accruedinterest 694 1,632 2,627Accountspayableandaccruals 3,478 2,304 347Accruedpropertytax 2,573 ‐ ‐



NETPOSITIONNetinvestmentincapitalassets 205 12,419 ‐Restricted 4,494 11,034 ‐Unrestricted 161 (359) (52,076)

Totalnetposition 4,860 23,094 (52,076)


NATURALGAS

ASSETS

LIABILITIES




OrmatGeothermalEnergy

MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas

DonA.Campbell/WildRoseGeothermal

CopperMountainSolar3

Columbia2Solar

Heber‐1Geothermal

KingbirdSolar

DonA.Campbell2Geothermal

NoncurrentassetsNetutilityplant ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$Investments–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Investments–unrestricted ‐ ‐ ‐ ‐ ‐ 8,988 ‐ ‐ ‐ ‐AdvancetoIPA–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalnoncurrentassets ‐ ‐ ‐ ‐ ‐ 8,988 ‐ ‐ ‐ ‐

CurrentassetsCashandcashequivalents–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Cashandcashequivalents–unrestricted 601 1,735 3,821 615 123 14,753 1,014 5,615 732 1,297Interestreceivable ‐ ‐ 1 ‐ ‐ 1 ‐ ‐ ‐ ‐Accountsreceivable 695 ‐ ‐ 47 2,597 ‐ 58 ‐ 142 ‐Materialsandsupplies ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets 5 3 4 3 5 30 17 ‐ ‐ 77

Totalcurrentassets 1,301 1,738 3,826 665 2,725 14,784 1,089 5,615 874 1,374

Unamortizedlossonrefunding ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaldeferredoutflowsofresources ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalassetsanddeferredoutflowsofresources 1,301$ 1,738$ 3,826$ 665$ 2,725$ 23,772$ 1,089$ 5,615$ 874$ 1,374$

ASSETS


POWERPURCHASEAGREEMENTS






MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas



Columbia2Solar

Heber‐1Geothermal

KingbirdSolar



NoncurrentliabilitiesLong‐termdebt ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Notespayableandotherliabilities ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipants ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalnoncurrentliabilities ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

CurrentliabilitiesDebtduewithinoneyear ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Notespayableandotherliabilitiesduewithinoneyear ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipantsduewithinoneyear 857 500 ‐ 400 1,629 ‐ 405 400 404 400Accruedinterest ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Accountspayableandaccruals 444 1,238 3,826 265 1,095 23,761 684 5,215 470 974Accruedpropertytax ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalcurrentliabilities 1,301 1,738 3,826 665 2,724 23,761 1,089 5,615 874 1,374

Totalliabilities 1,301 1,738 3,826 665 2,724 23,761 1,089 5,615 874 1,374

NETPOSITIONNetinvestmentincapitalassets ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Unrestricted ‐ ‐ ‐ ‐ 1 11 ‐ ‐ ‐ ‐

Totalnetposition ‐ ‐ ‐ ‐ 1 11 ‐ ‐ ‐ ‐

Totalliabilitiesandnetposition 1,301$ 1,738$ 3,826$ 665$ 2,725$ 23,772$ 1,089$ 5,615$ 874$ 1,374$

LIABILITIES




MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas

DonA.Campbell/Wild

RoseGeothermal


Columbia2Solar

NoncurrentassetsNetutilityplant ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$Investments–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐Investments–unrestricted ‐ ‐ 1,000 ‐ ‐ 9,994 ‐AdvancetoIPA–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy,net–restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalnoncurrentassets ‐ ‐ 1,000 ‐ ‐ 9,994 ‐

CurrentassetsCashandcashequivalents–restricted 1 1 ‐ 1 6 6 ‐Cashandcashequivalents–unrestricted 1,816 1,338 2,761 1,417 3,363 16,976 1,885Interestreceivable ‐ ‐ ‐ ‐ ‐ ‐ ‐Accountsreceivable 140 255 ‐ ‐ ‐ ‐ 37Materialsandsupplies ‐ ‐ ‐ ‐ ‐ ‐ ‐Prepaidandotherassets 1 1 6 1 6 5 ‐

Totalcurrentassets 1,958 1,595 2,767 1,419 3,375 16,987 1,922

Unamortizedlossonrefunding ‐ ‐ ‐ ‐ ‐ ‐ ‐Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaldeferredoutflowsofresources ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalassetsanddeferredoutflowsofresources 1,958$ 1,595$ 3,767$ 1,419$ 3,375$ 26,981$ 1,922$

NoncurrentliabilitiesLong‐termdebt ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$Fairvalueofderivativeinstruments ‐ ‐ ‐ ‐ ‐ ‐ ‐Notespayableandotherliabilities ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipants ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalnoncurrentliabilities ‐ ‐ ‐ ‐ ‐ ‐ ‐

CurrentliabilitiesDebtduewithinoneyear ‐ ‐ ‐ ‐ ‐ ‐ ‐Notespayableandotherliabilitiesduewithinoneyear ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesfromparticipantsduewithinoneyear 857 500 ‐ 400 480 ‐ 538Accruedinterest ‐ ‐ ‐ ‐ ‐ ‐ ‐Accountspayableandaccruals 1,101 1,095 3,767 1,019 2,895 26,981 1,384Accruedpropertytax ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalcurrentliabilities 1,958 1,595 3,767 1,419 3,375 26,981 1,922

Totalliabilities 1,958 1,595 3,767 1,419 3,375 26,981 1,922

NETPOSITIONNetinvestmentincapitalassets ‐ ‐ ‐ ‐ ‐ ‐ ‐Restricted ‐ ‐ ‐ ‐ ‐ ‐ ‐Unrestricted ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalnetposition ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totalliabilitiesandnetposition 1,958$ 1,595$ 3,767$ 1,419$ 3,375$ 26,981$ 1,922$

ASSETS

LIABILITIES







ProjectDevelopmentFund

Projects’StabilizationFund SCPPAFund TotalCombined

NoncurrentassetsNetutilityplant ‐$ ‐$ 4,269$ 1,427,164$Investments–restricted ‐ 112,728 ‐ 636,201Investments–unrestricted ‐ ‐ ‐ 61,806AdvancetoIPA–restricted ‐ ‐ ‐ 11,550Advancesforcapacityandenergy,

net–restricted ‐ ‐ ‐ 404Fairvalueofderivativeinstruments ‐ ‐ ‐ 3,731Prepaidandotherassets ‐ ‐ ‐ 849,731

Totalnoncurrentassets ‐ 112,728 4,269 2,990,587

CurrentassetsCashandcashequivalents–restricted 2,797 34,835 2,541 235,743Cashandcashequivalents–unrestricted ‐ ‐ ‐ 69,013Interestreceivable ‐ 59 ‐ 995Accountsreceivable ‐ ‐ ‐ 22,148Materialsandsupplies ‐ ‐ ‐ 26,155Prepaidandotherassets ‐ ‐ ‐ 66,419

Totalcurrentassets 2,797 34,894 2,541 420,473

Deferreditemsrelatedtopensions ‐ ‐ 440 440Unamortizedlossonrefunding ‐ ‐ ‐ 83,848Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐ 37,969

Totaldeferredoutflowsofresources ‐ ‐ 440 122,257

Totalassetsanddeferredoutflowsofresources 2,797$ 147,622$ 7,250$ 3,533,317$

NoncurrentliabilitiesLong‐termdebt ‐$ ‐$ ‐$ 3,025,767$Fairvalueofderivativeinstruments ‐ ‐ ‐ 63,413Notespayable,otherandnetpensionliabilities ‐ ‐ 1,011 1,603Advancesfromparticipants ‐ ‐ ‐ 24,211

Totalnoncurrentliabilities ‐ ‐ 1,011 3,114,994

CurrentliabilitiesDebtduewithinoneyear ‐ ‐ ‐ 191,730Notespayableandotherliabilitiesdue

withinoneyear ‐ ‐ ‐ 25,472Advancesfromparticipantsdue

withinoneyear 2,797 ‐ 2,509 73,003Accruedinterest ‐ ‐ ‐ 61,906Accountspayableandaccruals 2,097 ‐ 41 110,731Accruedpropertytax ‐ ‐ ‐ 4,190

Totalcurrentliabilities 4,894 ‐ 2,550 467,032

Totalliabilities 4,894 ‐ 3,561 3,582,026

Deferreditemsrelatedtopensions ‐ ‐ 242 242

Totaldeferredinflowsofresources ‐ ‐ 242 242

NETPOSITIONNetinvestmentincapitalassets (2,097) ‐ 4,261 (575,911)Restricted ‐ 147,622 ‐ 622,340Unrestricted ‐ ‐ (814) (95,380)

Totalnetposition (2,097) 147,622 3,447 (48,951)

Totalliabilities,deferredinflowsofresources,andnetposition 2,797$ 147,622$ 7,250$ 3,533,317$

ASSETS

LIABILITIES


DEFERREDINFLOWSOFRESOURCES

MISCELLANEOUS



ProjectDevelopmentFund

Projects’StabilizationFund SCPPAFund TotalCombined

NoncurrentassetsNetutilityplant ‐$ ‐$ 4,260$ 1,475,962$Investments–restricted ‐ 146,353 ‐ 631,010Investments–unrestricted ‐ ‐ ‐ 45,125AdvancetoIPA–restricted ‐ ‐ ‐ 11,550Advancesforcapacityandenergy,

net–restricted ‐ ‐ ‐ 2,036Fairvalueofderivativeinstruments ‐ ‐ ‐ 2,229Prepaidandotherassets ‐ ‐ ‐ 909,230

Totalnoncurrentassets ‐ 146,353 4,260 3,077,142

CurrentassetsCashandcashequivalents–restricted 6,485 10,019 165 236,950Cashandcashequivalents–unrestricted ‐ ‐ ‐ 100,424Interestreceivable ‐ 215 ‐ 1,278Accountsreceivable ‐ ‐ ‐ 11,673Materialsandsupplies ‐ ‐ ‐ 25,909Prepaidandotherassets ‐ ‐ ‐ 66,624

Totalcurrentassets 6,485 10,234 165 442,858

Deferreditemsrelatedtopensions ‐ ‐ 353 353Unamortizedlossonrefunding ‐ ‐ ‐ 96,202Accumulateddecreaseinfairvalueofhedgingderivatives ‐ ‐ ‐ 23,154

Totaldeferredoutflowsofresources ‐ ‐ 353 119,709

Totalassetsanddeferredoutflowsofresources 6,485$ 156,587$ 4,778$ 3,639,709$

NoncurrentliabilitiesLong‐termdebt ‐$ ‐$ ‐$ 3,176,756$Fairvalueofderivativeinstruments ‐ ‐ ‐ 36,857Notespayableandotherliabilities ‐ ‐ 874 9,118Advancesfromparticipants ‐ ‐ ‐ 26,450

Totalnoncurrentliabilities ‐ ‐ 874 3,249,181

CurrentliabilitiesDebtduewithinoneyear ‐ ‐ ‐ 181,710Notespayableandotherliabilitiesdue

withinoneyear ‐ ‐ ‐ 20,480Advancesfromparticipantsdue

withinoneyear 6,485 ‐ 133 45,634Accruedinterest ‐ ‐ ‐ 63,301Accountspayableandaccruals ‐ ‐ 33 133,067Accruedpropertytax ‐ ‐ ‐ 5,580

Totalcurrentliabilities 6,485 ‐ 166 449,772

Totalliabilities 6,485 ‐ 1,040 3,698,953

DEFERREDINFLOWSOFRESOURCESDeferreditemsrelatedtopensions ‐ ‐ 207 207

Totaldeferredinflowsofresources ‐ ‐ 207 207

NETPOSITIONNetinvestmentincapitalassets ‐ ‐ 4,259 (594,920)Restricted ‐ 156,587 ‐ 610,915Unrestricted ‐ ‐ (728) (75,446)

Totalnetposition ‐ 156,587 3,531 (59,451)

Totalliabilities,deferredinflowofresources,andnetposition 6,485$ 156,587$ 4,778$ 3,639,709$

ASSETS

LIABILITIES


MISCELLANEOUS


SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCOMBININGSTATEMENTSOFREVENUES,EXPENSES,ANDCHANGESIN

NETPOSITIONFORTHEYEARENDEDJUNE30,2016


PaloVerde SanJuanMagnoliaPower

CanyonPower ApexPower

OperatingrevenuesSalesofelectricenergy 81,843$ 71,411$ 66,622$ 25,026$ 119,741$Salesoftransmissionservices ‐ ‐ ‐ ‐ ‐Salesofnaturalgas ‐ ‐ ‐ ‐ ‐

Totaloperatingrevenues 81,843 71,411 66,622 25,026 119,741

OperatingexpensesOperationsandmaintenance 42,195 55,394 47,060 5,712 98,089Depreciation,depletionandamortization 21,041 8,290 10,954 9,584 12,352

Amortizationofnuclearfuel 14,653 ‐ ‐ ‐ ‐Decommissioning 17,964 3,250 ‐ ‐ ‐

Totaloperatingexpenses 95,853 66,934 58,014 15,296 110,441

Operatingincome(loss) (14,010) 4,477 8,608 9,730 9,300

Nonoperatingrevenues(expenses)Investmentandotherincome 3,825 8,184 755 4,292 398Derivativegain(loss) ‐ ‐ (11,740) ‐ ‐Debtexpense (121) (328) (10,725) (15,935) (11,820)

Netnonoperatingrevenues(expenses) 3,704 7,856 (21,710) (11,643) (11,422)

Changeinnetposition (10,306) 12,333 (13,102) (1,913) (2,122)

Netposition–beginningofyear 247,392 46,360 (63,690) (34,441) (7,856)

Netcontributions(distributions)byparticipants ‐ ‐ ‐ ‐ ‐

Netposition–endofyear 237,086$ 58,693$ (76,792)$ (36,354)$ (9,978)$

GENERATION


SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCOMBININGSTATEMENTSOFREVENUES,EXPENSES,ANDCHANGESINNETPOSITIONFORTHEYEARENDEDJUNE30,2015(AMOUNTSINTHOUSANDS)

PaloVerde SanJuanMagnoliaPower CanyonPower ApexPower

OperatingrevenuesSalesofelectricenergy 76,594$ 93,185$ 84,917$ 19,906$ 110,397$Salesoftransmissionservices ‐ ‐ ‐ ‐ ‐Salesofnaturalgas ‐ ‐ ‐ ‐ ‐

Totaloperatingrevenues 76,594 93,185 84,917 19,906 110,397

OperatingexpensesOperationsandmaintenance 42,079 66,647 61,980 7,129 91,865Depreciation,depletionandamortization 21,203 8,250 11,179 9,583 12,151

Amortizationofnuclearfuel 14,493 ‐ ‐ ‐ ‐Decommissioning 7,607 3,250 ‐ ‐ ‐

Totaloperatingexpenses 85,382 78,147 73,159 16,712 104,016

Operatingincome(loss) (8,788) 15,038 11,758 3,194 6,381

Nonoperatingrevenues(expenses)Investmentandotherincome 6,567 1,324 917 4,201 2,934Derivativegain(loss) ‐ ‐ (1,141) ‐ ‐Debtexpense (222) (1,865) (11,151) (15,674) (11,862)

Netnonoperatingrevenues(expenses) 6,345 (541) (11,375) (11,473) (8,928)

Changeinnetposition (2,443) 14,497 383 (8,279) (2,547)

Netposition–beginningofyear 249,835 31,863 (64,073) (26,162) (5,309)

Netcontributions(distributions)byparticipants ‐ ‐ ‐ ‐ ‐

Netposition–endofyear 247,392$ 46,360$ (63,690)$ (34,441)$ (7,856)$

GENERATION





HooverUprating

TietonHydropower

MilfordIWind

MilfordIIWind

WindyPoint

LindenWindEnergy

OperatingrevenuesSalesofelectricenergy 2,364$ 5,809$ 31,850$ 19,467$ 82,506$ 16,887$Salesoftransmissionservices ‐ ‐ ‐ ‐ ‐ ‐Salesofnaturalgas ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingrevenues 2,364 5,809 31,850 19,467 82,506 16,887

OperatingexpensesOperationsandmaintenance 2,643 2,115 24,615 15,306 69,343 7,562Depreciation,depletionandamortization ‐ 1,215 ‐ ‐ ‐ 5,814

Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐Decommissioning ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingexpenses 2,643 3,330 24,615 15,306 69,343 13,376

Operatingincome(loss) (279) 2,479 7,235 4,161 13,163 3,511

Nonoperatingrevenues(expenses)Investmentandotherincome 27 106 416 47 197 862Derivativegain(loss) ‐ ‐ ‐ ‐ ‐ ‐Debtexpense 594 (2,423) (8,631) (5,276) (15,637) (5,467)

Netnonoperatingrevenues(expenses) 621 (2,317) (8,215) (5,229) (15,440) (4,605)

Changeinnetposition 342 162 (980) (1,068) (2,277) (1,094)

Netposition–beginningofyear 1,969 (4,610) (16,396) (5,732) (35,505) (6,876)

Netcontributions(distributions)byparticipants ‐ ‐ ‐ ‐ ‐ ‐

Netposition–endofyear 2,311$ (4,448)$ (17,376)$ (6,800)$ (37,782)$ (7,970)$

GREENPOWER



HooverUprating

TietonHydropower

MilfordIWind


LindenWindEnergy

OperatingrevenuesSalesofelectricenergy 2,474$ 4,908$ 31,204$ 18,318$ 76,521$ 17,121$Salesoftransmissionservices ‐ ‐ ‐ ‐ ‐ ‐Salesofnaturalgas ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingrevenues 2,474 4,908 31,204 18,318 76,521 17,121

OperatingexpensesOperationsandmaintenance 2,835 1,601 24,000 14,156 67,324 7,797Depreciation,depletionandamortization ‐ 1,472 ‐ ‐ ‐ 5,814

Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐Decommissioning ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingexpenses 2,835 3,073 24,000 14,156 67,324 13,611

Operatingincome(loss) (361) 1,835 7,204 4,162 9,197 3,510

Nonoperatingrevenues(expenses)Investmentandotherincome 37 141 571 29 536 856Derivativegain(loss) ‐ ‐ ‐ ‐ ‐ ‐Debtexpense 652 (2,454) (8,864) (5,325) (15,933) (5,524)

Netnonoperatingrevenues(expenses) 689 (2,313) (8,293) (5,296) (15,397) (4,668)

Changeinnetposition 328 (478) (1,089) (1,134) (6,200) (1,158)

Netposition–beginningofyear 1,641 (4,132) (15,307) (4,598) (29,305) (5,718)

Netcontributions(distributions)byparticipants ‐ ‐ ‐ ‐ ‐ ‐

Netposition–endofyear 1,969$ (4,610)$ (16,396)$ (5,732)$ (35,505)$ (6,876)$

GREENPOWER





SouthernTransmission

System Mead‐Phoenix Mead‐Adelanto

OperatingrevenuesSalesofelectricenergy ‐$ ‐$ ‐$Salesoftransmissionservices 113,616 8,417 24,248Salesofnaturalgas ‐ ‐ ‐

Totaloperatingrevenues 113,616 8,417 24,248

OperatingexpensesOperationsandmaintenance 32,666 1,311 1,872Depreciation,depletionand

amortization 22,754 1,681 4,698Amortizationofnuclearfuel ‐ ‐ ‐Decommissioning ‐ ‐ ‐

Totaloperatingexpenses 55,420 2,992 6,570

Operatingincome(loss) 58,196 5,425 17,678

Nonoperatingrevenues(expenses)Investmentandotherincome 862 8 56Derivativegain(loss) ‐ ‐ 1,502Debtexpense (33,598) (1,081) (1,975)

Netnonoperatingrevenues(expenses) (32,736) (1,073) (417)


Netposition–beginningofyear (318,494) 2,637 (205)

Netcontributions(distributions)byparticipants ‐ ‐ ‐

Netposition–endofyear (293,034)$ 6,989$ 17,056$

TRANSMISSION





OperatingrevenuesSalesofelectricenergy ‐$ ‐$ ‐$Salesoftransmissionservices 105,822 9,819 24,900Salesofnaturalgas ‐ ‐ ‐



amortization 22,754 1,528 4,523Amortizationofnuclearfuel ‐ ‐ ‐Decommissioning ‐ ‐ ‐



Nonoperatingrevenues(expenses)Investmentandotherincome 830 7 24Derivativegain(loss) 28,028 ‐ 1,477Debtexpense (46,438) (2,918) (8,804)

Netnonoperatingrevenues(expenses) (17,580) (2,911) (7,303)


Netposition–beginningofyear (354,596) (184) (11,434)


Netposition–endofyear (318,494)$ 2,637$ (205)$

TRANSMISSION





Pinedale BarnettPrepaidNatural

Gas

OperatingrevenuesSalesofelectricenergy ‐$ ‐$ ‐$Salesoftransmissionservices ‐ ‐ ‐Salesofnaturalgas 7,338 13,367 19,445



amortization 3,642 4,388 ‐Amortizationofnuclearfuel ‐ ‐ ‐Decommissioning ‐ ‐ ‐



Nonoperatingrevenues(expenses)Investmentandotherincome 6 248 688Derivativegain(loss) ‐ ‐ ‐Debtexpense (1,273) (2,992) (16,028)


Changeinnetposition 318 1,781 (7,513)

Netposition–beginningofyear 4,860 23,094 (52,076)


Netposition–endofyear 5,178$ 24,875$ (59,589)$

NATURALGAS




Gas

OperatingrevenuesSalesofelectricenergy ‐$ ‐$ ‐$Salesoftransmissionservices ‐ ‐ ‐Salesofnaturalgas 8,409 16,039 19,591



amortization 4,105 3,915 ‐Amortizationofnuclearfuel ‐ ‐ ‐Decommissioning ‐ ‐ ‐



Nonoperatingrevenues(expenses)Investmentandotherincome 5 374 697Derivativegain(loss) ‐ ‐ ‐Debtexpense (1,388) (3,264) (16,220)


Changeinnetposition (185) 1,188 (7,667)

Netposition–beginningofyear 5,045 21,906 (44,409)


Netposition–endofyear 4,860$ 23,094$ (52,076)$

NATURALGAS





OrmatGeothermal

MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas



ColumbiaSolar2

Heber‐1Geothermal KingbirdSolar


OperatingrevenuesSalesofelectricenergy 8,987$ 2,150$ 21,652$ 3,239$ 16,865$ 58,602$ 3,155$ 15,466$ 58$ 11,850$Salesoftransmissionservices ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Salesofnaturalgas ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingrevenues 8,987 2,150 21,652 3,239 16,865 58,602 3,155 15,466 58 11,850

OperatingexpensesOperationsandmaintenance 8,988 2,151 21,658 3,239 16,866 58,644 3,155 15,470 1,125 11,852Depreciation,depletionand

amortization ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Decommissioning ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingexpenses 8,988 2,151 21,658 3,239 16,866 58,644 3,155 15,470 1,125 11,852

Operatingincome(loss) (1) (1) (6) ‐ (1) (42) ‐ (4) (1,067) (2)

Nonoperatingrevenues(expenses)Investmentandotherincome 1 1 6 ‐ 2 53 ‐ 4 1,067 2Derivativegain(loss) ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Debtexpense ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netnonoperatingrevenues(expenses) 1 1 6 ‐ 2 53 ‐ 4 1,067 2

Changeinnetposition ‐ ‐ ‐ ‐ 1 11 ‐ ‐ ‐ ‐

Netposition–beginningofyear ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netcontributions(distributions)byparticipants ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netposition–endofyear ‐$ ‐$ ‐$ ‐$ 1$ 11$ ‐$ ‐$ ‐$ ‐$




OrmatGeothermal

MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas



Columbia2Solar

OperatingrevenuesSalesofelectricenergy 7,208$ 2,379$ 19,351$ 2,924$ 15,765$ 43,675$ 1,668$Salesoftransmissionservices ‐ ‐ ‐ ‐ ‐ ‐ ‐Salesofnaturalgas ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingrevenues 7,208 2,379 19,351 2,924 15,765 43,675 1,668

OperatingexpensesOperationsandmaintenance 7,211 2,381 19,351 2,924 15,765 43,682 1,668Depreciation,depletionand

amortization ‐ ‐ ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐ ‐Decommissioning ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaloperatingexpenses 7,211 2,381 19,351 2,924 15,765 43,682 1,668

Operatingincome(loss) (3) (2) ‐ ‐ ‐ (7) ‐

Nonoperatingrevenues(expenses)Investmentandotherincome 3 2 ‐ ‐ ‐ 7 ‐Derivativegain(loss) ‐ ‐ ‐ ‐ ‐ ‐ ‐Debtexpense ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netnonoperatingrevenues(expenses) 3 2 ‐ ‐ ‐ 7 ‐

Changeinnetposition ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netposition–beginningofyear ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netcontributions(distributions)byparticipants ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netposition–endofyear ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$






ProjectDevelopment

Fund

Projects’Stabilization

Fund SCPPAFundTotal

Combined

OperatingrevenuesSalesofelectricenergy ‐$ ‐$ ‐$ 665,550$Salesoftransmissionservices ‐ ‐ ‐ 146,281Salesofnaturalgas ‐ ‐ ‐ 40,150

Totaloperatingrevenues ‐ ‐ ‐ 851,981

OperatingexpensesOperationsandmaintenance 2,097 ‐ 270 569,581Depreciation,depletionandamortization ‐ ‐ 113 106,526

Amortizationofnuclearfuel ‐ ‐ ‐ 14,653Decommissioning ‐ ‐ ‐ 21,214Pensionexpense(credit) ‐ ‐ 85 85

Totaloperatingexpenses 2,097 ‐ 468 712,059

Operatingincome(loss) (2,097) ‐ (468) 139,922

Nonoperatingrevenues(expenses)Investmentandotherincome ‐ 1,250 270 23,633Derivativegain(loss) ‐ ‐ ‐ (10,238)Debtexpense ‐ ‐ ‐ (132,716)

Netnonoperatingrevenues(expenses) ‐ 1,250 270 (119,321)

Changeinnetposition (2,097) 1,250 (198) 20,601

Netposition–beginningofyear ‐ 156,587 3,531 (59,451)

Netcontributions(distributions)byparticipants ‐ (10,215) 114 (10,101)

Netposition–endofyear (2,097)$ 147,622$ 3,447$ (48,951)$

MISCELLANEOUS



ProjectDevelopment

Fund


Fund SCPPAFundTotal

Combined

OperatingrevenuesSalesofelectricenergy ‐$ ‐$ ‐$ 628,515$Salesoftransmissionservices ‐ ‐ ‐ 140,541Salesofnaturalgas ‐ ‐ ‐ 44,039

Totaloperatingrevenues ‐ ‐ ‐ 813,095

OperatingexpensesOperationsandmaintenance ‐ ‐ 144 537,216Depreciation,depletionand

amortization ‐ ‐ 113 106,590Amortizationofnuclearfuel ‐ ‐ ‐ 14,493Decommissioning ‐ ‐ ‐ 10,857Pensionexpense(credit) ‐ ‐ (276) (276)

Totaloperatingexpenses ‐ ‐ (19) 668,880

Operatingincome(loss) ‐ ‐ 19 144,215

Nonoperatingrevenues(expenses)Investmentandotherincome ‐ 1,703 144 21,909Derivativegain(loss) ‐ ‐ ‐ 28,364Debtexpense ‐ ‐ ‐ (157,254)

Netnonoperatingrevenues(expenses) ‐ 1,703 144 (106,981)

Changeinnetposition ‐ 1,703 163 37,234

Netposition–beginningofyear,beforeadjustment ‐ 152,027 4,223 (98,687)

Less:Accumulatedadjustmentforchangeinaccountingprincipal ‐ ‐ (1,004) (1,004)

Netposition–beginningofyear,asadjusted ‐ 152,027 3,219 (99,691)

Netcontributions(distributions)byparticipants ‐ 2,857 149 3,006

Netposition–endofyear ‐$ 156,587$ 3,531$ (59,451)$

MISCELLANEOUS



COMBININGSTATEMENTSOFCASHFLOWSFORTHEYEARENDEDJUNE30,2016




CashflowsfromoperatingactivitiesReceiptsfromparticipants 77,165$ 87,660$ 53,406$ 21,975$ 35,718$Receiptsfromsaleofoilandgas ‐ ‐ ‐ ‐ ‐Paymentstooperatingmanagers (41,815) (56,585) (30,870) (2,754) (35,157)Otherdisbursementsandreceipts 8,338 8,816 3 (12) 587

Netcashflowsfromoperatingactivities 43,688 39,891 22,539 19,209 1,148

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐ ‐ ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net (30,585) (649) (2,362) 5 (2,503)Debtinterestandswappayments (123) (350) (10,831) (13,039) (12,588)Proceedsfromsaleofbonds ‐ ‐ ‐ 93,834 ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ (92,261) ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ (3,760) ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐ ‐Principalpaymentsondebt (11,690) (21,590) (10,985) ‐ (9,335)Paymentforbondissuecosts ‐ ‐ ‐ (507) ‐

Netcashusedforcapitalandrelatedfinancingactivities (42,398) (26,349) (24,178) (11,968) (24,426)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 271 63 655 405 108Purchasesofinvestments (48,024) (53,539) (68,015) (29,667) (79,807)Proceedsfromsale/maturityofinvestments 34,525 21,700 67,963 21,440 79,664

Netcashprovidedby(usedfor)investingactivities (13,228) (31,776) 603 (7,822) (35)

Netincrease(decrease)incashandcashequivalents (11,938) (18,234) (1,036) (581) (23,313)

Cashandcashequivalents,beginningofyear 33,775 20,988 37,038 11,949 34,107

Cashandcashequivalents,endofyear 21,837$ 2,754$ 36,002$ 11,368$ 10,794$

Reconciliationofoperatingincome(loss)tonetcashprovidedbyoperatingactivities

Operatingincome(loss) (14,010)$ 4,477$ 8,608$ 9,730$ 9,300$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization 21,041 8,290 10,954 9,584 12,352Decommissioning 17,964 1,543 ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel 14,653 1,706 ‐ ‐ 392

ChangesinassetsandliabilitiesAccountsreceivable 216 ‐ (8,265) (291) ‐Accountspayableandaccruals 3,107 13,637 (2,218) 151 (20,078)Other 717 10,238 13,460 35 (818)

Netcashprovidedbyoperatingactivities 43,688$ 39,891$ 22,539$ 19,209$ 1,148$


Cashandcashequivalents–restricted 14,523$ 674$ 32,884$ 10,717$ 10,068$Cashandcashequivalents–unrestricted 7,314 2,080 3,118 651 726

21,837$ 2,754$ 36,002$ 11,368$ 10,794$

GENERATION


SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCOMBININGSTATEMENTSOFCASHFLOWSFORTHEYEARENDEDJUNE30,2015(AMOUNTSINTHOUSANDS)


CanyonPower

ApexPower

CashflowsfromoperatingactivitiesReceiptsfromparticipants 81,113$ 87,760$ 49,127$ 15,323$ 53,914$Receiptsfromsaleofoilandgas ‐ ‐ ‐ ‐ ‐Paymentstooperatingmanagers (44,522) (65,534) (26,527) (2,386) (32,543)Otherdisbursementsandreceipts 13,513 ‐ ‐ ‐ 3,460

Netcashflowsfromoperatingactivities 50,104 22,226 22,600 12,937 24,831

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐ ‐ 21

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net (31,134) (114) (1,331) (128) (536)Debtinterestandswappayments (203) (3,724) (11,368) (11,220) (9,632)Proceedsfromsaleofbonds ‐ 42,935 ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ (71,880) ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ (420) ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐ ‐Principalpaymentsondebt (11,330) ‐ (10,565) ‐ ‐Paymentforbondissuecosts ‐ (313) ‐ ‐ ‐

Netcashusedforcapitalandrelatedfinancingactivities (42,667) (33,516) (23,264) (11,348) (10,168)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 286 232 748 282 157Purchasesofinvestments (17,490) (26,480) (36,631) (3,195) (65,540)Proceedsfromsale/maturityofinvestments 26,250 36,198 39,840 4,000 51,070

Netcashprovidedby(usedfor)investingactivities 9,046 9,950 3,957 1,087 (14,313)

Netincrease(decrease)incashandcashequivalents 16,483 (1,340) 3,293 2,676 371

Cashandcashequivalents,beginningofyear 17,292 22,328 33,745 9,273 33,736

Cashandcashequivalents,endofyear 33,775$ 20,988$ 37,038$ 11,949$ 34,107$


Operatingincome(loss) (8,788)$ 15,038$ 11,758$ 3,194$ 6,381$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization 21,203 8,250 11,179 9,583 12,690Decommissioning 7,607 3,250 ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel 14,493 ‐ ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable 3,197 (205) 1,266 (28) ‐Accountspayableandaccruals 7,071 (4,810) (766) 232 4,243Other 5,321 703 (837) (44) 1,517

Netcashprovidedbyoperatingactivities 50,104$ 22,226$ 22,600$ 12,937$ 24,831$


Cashandcashequivalents–restricted 22,159$ 15,075$ 29,108$ 11,299$ 16,667$Cashandcashequivalents–unrestricted 11,616 5,913 7,930 650 17,440

33,775$ 20,988$ 37,038$ 11,949$ 34,107$

GENERATION





HooverUprating

TietonHydropower

MilfordIWind

MilfordIIWind

WindyPoint

LindenWindEnergy

CashflowsfromoperatingactivitiesReceiptsfromparticipants 2,320$ 5,532$ 31,817$ 18,414$ 80,271$ 17,025$Receiptsfromsaleofoilandgas ‐ ‐ ‐ ‐ ‐ ‐Paymentstooperatingmanagers (157) (2,252) (12,412) (5,195) (41,767) (7,828)Otherdisbursementsandreceipts (12) (4) ‐ (3) ‐ (5)

Netcashflowsfromoperatingactivities 2,151 3,276 19,405 13,216 38,504 9,192

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐ ‐ ‐ ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ ‐ ‐ ‐ ‐ ‐Debtinterestandswappayments (269) (2,505) (9,874) (7,201) (21,277) (5,608)Proceedsfromsaleofbonds ‐ ‐ ‐ ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐ ‐ ‐Principalpaymentsondebt (1,930) (840) (8,820) (5,530) (19,390) (3,670)Paymentforbondissuecosts ‐ ‐ ‐ ‐ ‐ ‐

Netcashusedforcapitalandrelatedfinancingactivities (2,199) (3,345) (18,694) (12,731) (40,667) (9,278)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 22 70 290 59 171 31Purchasesofinvestments (1,761) (3,205) (27,914) (16,678) (33,759) (7,748)Proceedsfromsale/maturityofinvestments 2,000 3,205 31,035 10,720 32,005 5,580

Netcashprovidedby(usedfor)investingactivities 261 70 3,411 (5,899) (1,583) (2,137)

Netincrease(decrease)incashandcashequivalents 213 1 4,122 (5,414) (3,746) (2,223)

Cashandcashequivalents,beginningofyear 881 3,133 13,799 11,602 25,205 8,211

Cashandcashequivalents,endofyear 1,094$ 3,134$ 17,921$ 6,188$ 21,459$ 5,988$


Operatingincome(loss) (279)$ 2,479$ 7,235$ 4,161$ 13,163$ 3,511$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization ‐ 1,215 ‐ ‐ ‐ 5,814Decommissioning ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy 2,480 ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ 11,338 8,643 27,373 ‐

ChangesinassetsandliabilitiesAccountsreceivable ‐ (137) ‐ ‐ ‐ 129Accountspayableandaccruals (62) (263) 832 406 (2,049) (141)Other 12 (18) ‐ 6 17 (121)

Netcashprovidedbyoperatingactivities 2,151$ 3,276$ 19,405$ 13,216$ 38,504$ 9,192$


Cashandcashequivalents–restricted 376$ 2,570$ 12,642$ 4,343$ 17,324$ 5,328$Cashandcashequivalents–unrestricted 718 564 5,279 1,845 4,135 660

1,094$ 3,134$ 17,921$ 6,188$ 21,459$ 5,988$

GREENPOWER



HooverUprating

TietonHydropower

MilfordIWind

MilfordIIWind

WindyPoint

LindenWindEnergy

CashflowsfromoperatingactivitiesReceiptsfromparticipants 2,539$ 4,885$ 26,928$ 17,690$ 76,460$ 16,697$Receiptsfromsaleofoilandgas ‐ ‐ ‐ ‐ ‐ ‐Paymentstooperatingmanagers (308) (1,782) (12,662) (5,589) (34,222) (7,830)Otherdisbursementsandreceipts ‐ ‐ ‐ ‐ ‐ ‐

Netcashflowsfromoperatingactivities 2,231 3,103 14,266 12,101 42,238 8,867

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐ ‐ ‐ ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ ‐ ‐ ‐ ‐Debtinterestandswappayments (368) (2,532) (10,236) (7,463) (22,081) (5,357)Proceedsfromsaleofbonds ‐ ‐ ‐ ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐ ‐ ‐Principalpaymentsondebt (1,835) (815) (8,450) (5,270) (18,535) (3,530)Paymentforbondissuecosts ‐ ‐ ‐ ‐ ‐ ‐

Netcashusedforcapitalandrelatedfinancingactivities (2,203) (3,347) (18,686) (12,733) (40,616) (8,887)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 24 69 317 56 194 31Purchasesofinvestments (1,999) ‐ (15,445) (5,526) (22,992) (5,584)Proceedsfromsale/maturityofinvestments 1,860 500 18,149 6,400 21,499 6,478

Netcashprovidedby(usedfor)investingactivities (115) 569 3,021 930 (1,299) 925

Netincrease(decrease)incashandcashequivalents (87) 325 (1,399) 298 323 905

Cashandcashequivalents,beginningofyear 968 2,808 15,198 11,304 24,882 7,306

Cashandcashequivalents,endofyear 881$ 3,133$ 13,799$ 11,602$ 25,205$ 8,211$


Operatingincome(loss) (361)$ 1,835$ 7,204$ 4,162$ 9,197$ 3,510$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization ‐ 1,472 11,338 8,643 31,635 5,814Decommissioning ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy 2,550 ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable ‐ ‐ ‐ ‐ ‐ (129)Accountspayableandaccruals 56 203 (4,267) (696) 1,073 (318)Other (14) (407) (9) (8) 333 (10)

Netcashprovidedbyoperatingactivities 2,231$ 3,103$ 14,266$ 12,101$ 42,238$ 8,867$


Cashandcashequivalents–restricted 89$ 2,554$ 11,855$ 9,199$ 19,228$ 7,988$Cashandcashequivalents–unrestricted 792 579 1,944 2,403 5,977 223

881$ 3,133$ 13,799$ 11,602$ 25,205$ 8,211$

GREENPOWER







CashflowsfromoperatingactivitiesReceiptsfromparticipants 113,422$ 8,169$ 25,117$Receiptsfromsaleofoilandgas ‐ ‐ ‐Paymentstooperatingmanagers (34,480) (1,495) (1,996)Otherdisbursementsandreceipts 21 83 ‐

Netcashflowsfromoperatingactivities 78,963 6,757 23,121

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ (27,270) (33,226)Debtinterestandswappayments (26,606) (1,372) (4,907)Proceedsfromsaleofbonds ‐ 27,214 33,514Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐Principalpaymentsondebt (53,085) (5,480) (17,690)Paymentforbondissuecosts (55) (318) (372)

Netcashusedforcapitalandrelatedfinancingactivities (79,746) (7,226) (22,681)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 713 3 13Purchasesofinvestments (63,706) (2,296) (20,967)Proceedsfromsale/maturityofinvestments 71,602 2,900 17,900

Netcashprovidedby(usedfor)investingactivities 8,609 607 (3,054)

Netincrease(decrease)incashandcashequivalents 7,826 138 (2,614)

Cashandcashequivalents,beginningofyear 45,449 4,677 14,160

Cashandcashequivalents,endofyear 53,275$ 4,815$ 11,546$


Operatingincome(loss) 58,196$ 5,425$ 17,678$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization 22,754 1,681 4,698Decommissioning ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable (120) (273) 48Accountspayableandaccruals (1,843) (191) 697Other (24) 115 ‐

Netcashprovidedbyoperatingactivities 78,963$ 6,757$ 23,121$


Cashandcashequivalents–restricted 50,283$ 4,327$ 10,896$Cashandcashequivalents–unrestricted 2,992 488 650

53,275$ 4,815$ 11,546$

TRANSMISSION





CashflowsfromoperatingactivitiesReceiptsfromparticipants 106,683$ 10,408$ 24,953$Receiptsfromsaleofoilandgas ‐ ‐ ‐Paymentstooperatingmanagers (23,911) (2,709) (1,813)Otherdisbursementsandreceipts ‐ 2 2


CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ (128) (38)Debtinterestandswappayments (31,347) (1,507) (5,491)Proceedsfromsaleofbonds 273,160 ‐ ‐Paymentfordefeasanceofrevenuebonds (277,790) ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐Principalpaymentsondebt (50,885) (5,215) (17,385)Paymentforbondissuecosts (1,237) ‐ ‐


CashflowsfrominvestingactivitiesInterestreceivedoninvestments 709 2 8Purchasesofinvestments (55,871) (2,898) (22,234)Proceedsfromsale/maturityofinvestments 73,207 2,300 25,750

Netcashprovidedby(usedfor)investingactivities 18,045 (596) 3,524

Netincrease(decrease)incashandcashequivalents 12,718 255 3,752





cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization 22,754 1,528 4,523Decommissioning ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable (603) 98 15Accountspayableandaccruals 6,959 450 84Other (20) (107) (12)



Cashandcashequivalents–restricted 40,466$ 2,358$ 12,098$Cashandcashequivalents–unrestricted 4,983 2,319 2,062

45,449$ 4,677$ 14,160$

TRANSMISSION






Gas

CashflowsfromoperatingactivitiesReceiptsfromparticipants 5,475$ 8,677$ 5,934$Receiptsfromsaleofoilandgas 1,117 ‐ ‐Paymentstooperatingmanagers (2,240) 2,140 13,891Otherdisbursementsandreceipts 7 (2,764) (310)


CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net 1,075 177 ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net (5) (448) ‐Debtinterestandswappayments (1,330) (3,128) (15,658)Proceedsfromsaleofbonds ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐Principalpaymentsondebt (2,274) (5,326) (4,075)Paymentforbondissuecosts ‐ ‐ ‐


CashflowsfrominvestingactivitiesInterestreceivedoninvestments 4 222 692Purchasesofinvestments (1,099) (52,030) (18,218)Proceedsfromsale/maturityofinvestments ‐ 51,370 18,066

Netcashprovidedby(usedfor)investingactivities (1,095) (438) 540

Netincrease(decrease)incashandcashequivalents 730 (1,110) 322





cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization 3,642 4,388 ‐Decommissioning ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐Amortizationofnuclearfuel ‐ (798) ‐

ChangesinassetsandliabilitiesAccountsreceivable 749 344 7Accountspayableandaccruals (6) (414) 349Other (1,611) 8 11,332



Cashandcashequivalents–restricted 4,104$ 9,769$ 4,742$Cashandcashequivalents–unrestricted 5,929 1,502 56

10,033$ 11,271$ 4,798$

NATURALGAS




Gas

CashflowsfromoperatingactivitiesReceiptsfromparticipants 4,061$ 9,782$ 7,429$Receiptsfromsaleofoilandgas 2,063 4,510 9,713Paymentstooperatingmanagers (4,542) (5,872) (476)Otherdisbursementsandreceipts 14 ‐ ‐


CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net (7,805) (47) ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net (122) (636) ‐Debtinterestandswappayments (1,440) (3,384) (15,857)Proceedsfromsaleofbonds ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐Principalpaymentsondebt (2,219) (5,211) (3,875)Paymentforbondissuecosts ‐ ‐ ‐


CashflowsfrominvestingactivitiesInterestreceivedoninvestments 3 228 688Purchasesofinvestments ‐ (9,498) (16,077)Proceedsfromsale/maturityofinvestments ‐ 6,400 16,069

Netcashprovidedby(usedfor)investingactivities 3 (2,870) 680

Netincrease(decrease)incashandcashequivalents (9,987) (3,728) (2,386)





cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization 4,105 3,915 ‐Decommissioning ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable (702) 936 (17)Accountspayableandaccruals (1,234) (90) (2,448)Other (1,771) (419) 11,275



Cashandcashequivalents–restricted 4,607$ 11,117$ 4,399$Cashandcashequivalents–unrestricted 4,696 1,264 77

9,303$ 12,381$ 4,476$

NATURALGAS






MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas

DonA.Campbell/Wild

RoseGeothermal

CopperMountainSolar

3Columbia2

SolarHeber‐1

Geothermal KingbirdSolar


CashflowsfromoperatingactivitiesReceiptsfromparticipants 8,418$ 2,659$ 21,773$ 2,636$ 12,476$ 60,655$ 1,514$ 18,978$ 1,178$ 12,340$Receiptsfromsaleofoilandgas ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Paymentstooperatingmanagers (9,637) (2,265) (21,718) (3,441) (16,873) (63,954) (3,440) (13,367) (1,721) (11,045)Otherdisbursementsandreceipts 2 1 (2) 2 ‐ 12 1,055 ‐ 208 ‐

Netcashflowsfromoperatingactivities (1,217) 395 53 (803) (4,397) (3,287) (871) 5,611 (335) 1,295

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐ ‐ 1,149 ‐ ‐ ‐ 1,067 ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Debtinterestandswappayments ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Proceedsfromsaleofbonds ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Principalpaymentsondebt ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Paymentforbondissuecosts ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netcashusedforcapitalandrelatedfinancingactivities ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 1 1 7 ‐ 2 26 ‐ 4 ‐ 2Purchasesofinvestments ‐ ‐ ‐ ‐ ‐ (23,968) ‐ ‐ ‐ ‐Proceedsfromsale/maturityofinvestments ‐ ‐ 1,000 ‐ ‐ 25,000 ‐ ‐ ‐ ‐

Netcashprovidedby(usedfor)investingactivities 1 1 1,007 ‐ 2 1,058 ‐ 4 ‐ 2

Netincrease(decrease)incashandcashequivalents (1,216) 396 1,060 (803) (3,246) (2,229) (871) 5,615 732 1,297

Cashandcashequivalents,beginningofyear 1,817 1,339 2,761 1,418 3,369 16,982 1,885 ‐ ‐ ‐

Cashandcashequivalents,endofyear 601$ 1,735$ 3,821$ 615$ 123$ 14,753$ 1,014$ 5,615$ 732$ 1,297$





MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas

DonA.Campbell/Wild

RoseGeothermal

CopperMountainSolar

3Columbia2

SolarHeber‐1

Geothermal KingbirdSolar




Operatingincome(loss) (1)$ (1)$ (6)$ ‐$ (1)$ (42)$ ‐$ (4)$ (1,067)$ (2)$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivities ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Depreciation,depletionandamortization ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Decommissioning ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable (555) 255 ‐ (47) (2,597) ‐ (21) ‐ (142) ‐Accountspayableandaccruals (656) 143 60 (754) (1,800) (3,220) (833) 5,615 874 1,377Other (5) (2) (1) (2) 1 (25) (17) ‐ ‐ (80)

Netcashprovidedbyoperatingactivities (1,217)$ 395$ 53$ (803)$ (4,397)$ (3,287)$ (871)$ 5,611$ (335)$ 1,295$


Cashandcashequivalents–restricted ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$Cashandcashequivalents–unrestricted 601 1,735 3,821 615 123 14,753 1,014 5,615 732 1,297

601$ 1,735$ 3,821$ 615$ 123$ 14,753$ 1,014$ 5,615$ 732$ 1,297$






MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas



Columbia2Solar

CashflowsfromoperatingactivitiesReceiptsfromparticipants 6,345$ 2,372$ 19,271$ 2,354$ 18,951$ 53,181$ 2,430$Receiptsfromsaleofoilandgas ‐ ‐ ‐ ‐ ‐ ‐ ‐Paymentstooperatingmanagers (7,354) (2,262) (19,633) (2,977) (15,649) (27,833) (1,065)Otherdisbursementsandreceipts 3 6 ‐ ‐ ‐ ‐ 520

Netcashflowsfromoperatingactivities (1,006) 116 (362) (623) 3,302 25,348 1,885

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net ‐ ‐ ‐ ‐ ‐ ‐ ‐

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ ‐ ‐ ‐ ‐ ‐ ‐Debtinterestandswappayments ‐ ‐ ‐ ‐ ‐ ‐ ‐Proceedsfromsaleofbonds ‐ ‐ ‐ ‐ ‐ ‐ ‐Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐ ‐ ‐ ‐ ‐Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐ ‐ ‐ ‐Principalpaymentsondebt ‐ ‐ ‐ ‐ ‐ ‐ ‐Paymentforbondissuecosts ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netcashusedforcapitalandrelatedfinancingactivities ‐ ‐ ‐ ‐ ‐ ‐ ‐

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 4 2 ‐ ‐ ‐ 8 ‐Purchasesofinvestments ‐ ‐ (1,000) ‐ ‐ (14,989) ‐Proceedsfromsale/maturityofinvestments ‐ ‐ ‐ ‐ ‐ 5,000 ‐

Netcashprovidedby(usedfor)investingactivities 4 2 (1,000) ‐ ‐ (9,981) ‐

Netincrease(decrease)incashandcashequivalents (1,002) 118 (1,362) (623) 3,302 15,367 1,885

Cashandcashequivalents,beginningofyear 2,819 1,221 4,123 2,041 67 1,615 ‐

Cashandcashequivalents,endofyear 1,817$ 1,339$ 2,761$ 1,418$ 3,369$ 16,982$ 1,885$


Operatingincome(loss) (3)$ (2)$ ‐$ ‐$ ‐$ (7)$ ‐$Adjustmentstoreconcileoperatingincome(loss)tonet

cashprovidedbyoperatingactivitiesDepreciation,depletionandamortization ‐ ‐ ‐ ‐ ‐ ‐ ‐Decommissioning ‐ ‐ ‐ ‐ ‐ ‐ ‐Advancesforcapacityandenergy ‐ ‐ ‐ ‐ ‐ ‐ ‐Amortizationofnuclearfuel ‐ ‐ ‐ ‐ ‐ ‐ ‐

ChangesinassetsandliabilitiesAccountsreceivable (140) (85) ‐ ‐ 915 ‐ (37)Accountspayableandaccruals (864) 197 (356) (623) 2,387 25,359 1,922Other 1 6 (6) ‐ ‐ (4) ‐

Netcashprovidedbyoperatingactivities (1,006)$ 116$ (362)$ (623)$ 3,302$ 25,348$ 1,885$


Cashandcashequivalents–restricted 1$ 1$ ‐$ 1$ 6$ 6$ ‐$Cashandcashequivalents–unrestricted 1,816 1,338 2,761 1,417 3,363 16,976 1,885

1,817$ 1,339$ 2,761$ 1,418$ 3,369$ 16,982$ 1,885$




ProjectDevelopment

Fund


Fund SCPPAFund TotalCombined

CashflowsfromoperatingactivitiesReceiptsfromparticipants ‐$ ‐$ ‐$ 740,724$Receiptsfromsaleofoilandgas ‐ ‐ ‐ 1,117Paymentstooperatingmanagers ‐ ‐ ‐ (408,433)Otherdisbursementsandreceipts ‐ ‐ (270) 15,753

Netcashflowsfromoperatingactivities ‐ ‐ (270) 349,161

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net (3,688) (10,215) 2,760 (7,675)

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ ‐ (114) (97,157)Debtinterestandswappayments ‐ ‐ ‐ (136,666)Proceedsfromsaleofbonds ‐ ‐ ‐ 154,562Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ (92,261)Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐ (3,760)Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐Principalpaymentsondebt ‐ ‐ ‐ (181,710)Paymentforbondissuecosts ‐ ‐ ‐ (1,252)

Netcashusedforcapitalandrelatedfinancingactivities ‐ ‐ (114) (358,244)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments 1,078 4,913Purchasesofinvestments (103,157) (655,558)Proceedsfromsale/maturityofinvestments 137,110 634,785

Netcashprovidedby(usedfor)investingactivities ‐ 35,031 ‐ (15,860)

Netincrease(decrease)incashandcashequivalents (3,688) 24,816 2,376 (32,618)

Cashandcashequivalents,beginningofyear 6,485 10,019 165 337,374

Cashandcashequivalents,endofyear 2,797$ 34,835$ 2,541$ 304,756$


Operatingincome(loss) (2,097)$ ‐$ (468)$ 139,922$Adjustmentstoreconcileoperatingincome(loss)to

netcashprovidedbyoperatingactivitiesDepreciation,depletionandamortization ‐ ‐ 113 106,526Decommissioning ‐ ‐ ‐ 19,507Advancesforcapacityandenergy ‐ ‐ ‐ 2,480Amortizationofnuclearfuel ‐ ‐ ‐ 63,307Pensionexpense ‐ ‐ 85 85

ChangesinassetsandliabilitiesAccountsreceivable ‐ ‐ ‐ (10,700)Accountspayableandaccruals 2,097 ‐ ‐ (5,183)Other ‐ ‐ ‐ 33,217

Netcashprovidedbyoperatingactivities ‐$ ‐$ (270)$ 349,161$


Cashandcashequivalents–restricted 2,797$ 34,835$ 2,541$ 235,743$Cashandcashequivalents–unrestricted ‐ ‐ ‐ 69,013

2,797$ 34,835$ 2,541$ 304,756$

MISCELLANEOUS





ProjectDevelopment

Fund


Fund SCPPAFund TotalCombined

CashflowsfromoperatingactivitiesReceiptsfromparticipants ‐$ ‐$ ‐$ 700,656$Receiptsfromsaleofoilandgas ‐ ‐ ‐ 16,286Paymentstooperatingmanagers ‐ ‐ ‐ (350,001)Otherdisbursementsandreceipts ‐ ‐ (144) 17,376

Netcashflowsfromoperatingactivities ‐ ‐ (144) 384,317

CashflowsfromnoncapitalfinancingactivitiesAdvances(withdrawals)byparticipants,net 6,420 2,857 144 1,590

CashflowsfromcapitalfinancingactivitiesAdditionstoplantandprepaidprojects,net ‐ ‐ (149) (34,316)Debtinterestandswappayments ‐ ‐ ‐ (143,210)Proceedsfromsaleofbonds ‐ ‐ ‐ 316,095Paymentfordefeasanceofrevenuebonds ‐ ‐ ‐ (349,670)Transferoffundsfrom(to)escrow ‐ ‐ ‐ ‐Transferoffundsfrom(to)MineReclamationTrustFund ‐ ‐ ‐ (420)Transferoffundsfrom(to)otherprojects ‐ ‐ ‐ ‐Principalpaymentsondebt ‐ ‐ ‐ (122,520)Paymentforbondissuecosts ‐ ‐ ‐ (24,150)

Netcashusedforcapitalandrelatedfinancingactivities ‐ ‐ (149) (358,191)

CashflowsfrominvestingactivitiesInterestreceivedoninvestments ‐ 1,246 ‐ 5,294Purchasesofinvestments ‐ (102,385) ‐ (425,834)Proceedsfromsale/maturityofinvestments ‐ 87,475 ‐ 428,445

Netcashprovidedby(usedfor)investingactivities ‐ (13,664) ‐ 7,905

Netincrease(decrease)incashandcashequivalents 6,420 (10,807) (149) 35,621

Cashandcashequivalents,beginningofyear 65 20,826 314 301,753

Cashandcashequivalents,endofyear 6,485$ 10,019$ 165$ 337,374$


Operatingincome(loss) ‐$ ‐$ 19$ 144,215$Adjustmentstoreconcileoperatingincome(loss)to

netcashprovidedbyoperatingactivitiesDepreciation,depletionandamortization ‐ ‐ 113 158,745Decommissioning ‐ ‐ ‐ 10,857Advancesforcapacityandenergy ‐ ‐ ‐ 2,550Amortizationofnuclearfuel ‐ ‐ ‐ 14,493Pensionexpense ‐ ‐ (276) (276)

ChangesinassetsandliabilitiesAccountsreceivable ‐ ‐ ‐ 4,481Accountspayableandaccruals ‐ ‐ ‐ 33,764Other ‐ ‐ ‐ 15,488

Netcashprovidedbyoperatingactivities ‐$ ‐$ (144)$ 384,317$


Cashandcashequivalents–restricted 6,485$ 10,019$ 165$ 236,950$Cashandcashequivalents–unrestricted ‐ ‐ ‐ 100,424

6,485$ 10,019$ 165$ 337,374$

MISCELLANEOUS

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYNOTESTOCOMBINEDFINANCIALSTATEMENTS

51

Note1–OrganizationandPurposeThe Southern California Public Power Authority (the Authority or SCPPA), a public entity organizedunder the laws of the State of California, was formed by a Joint Powers Agreement dated as ofNovember1,1980pursuanttotheJointExerciseofPowersActoftheStateofCalifornia.TheAuthority’sparticipants consist of eleven municipal electric utilities and one irrigation district in the State ofCalifornia. The Authority was formed for the purpose of planning, financing, developing, acquiring,constructing,operatingandmaintainingprojectsforthegeneration,transmission,andprocurementofelectric energy and natural gas for sale to its participants. The Joint Powers Agreement has a termexpiringin2030orsuchlaterdateasallbondsandnotesoftheAuthorityandtheinterestthereonhavebeenpaidinfulloradequateprovisionforpaymentshavebeenmade.TheAuthorityhasinterestsinthefollowingprojects:GENERATIONPROJECTSPaloVerdeProject–OnAugust14,1981,theAuthoritypurchaseda5.91%interestinthePaloVerdeNuclear Generating Station (PVNGS), a 3,810 MW nuclear‐fueled generating station near Phoenix,Arizona, a 5.44% ownership interest in the Arizona Nuclear Power Project High Voltage Switchyard(ANPPHVS),anda6.55%shareoftherighttousecertainportionsoftheArizonaNuclearPowerProjectValley Transmission System (collectively, the Palo Verde Project). Units 1, 2 and 3 of the Palo VerdeProjectbegancommercialoperationsinJanuary1986,September1986,andJanuary1988,respectively.SinceinceptionoftheANPPHVScapitaladditions,newterminations,andothereventshavesuccessivelychanged the respective ownership interests in the ANPP HVS. In FYE 2011, the PVNGS fourthtransformer became the 14th termination in the ANPP HVS, and caused the Authority’s proportionalownershippercentagetochangefrom5.56%to5.44%.ThischangebecameeffectiveonApril1,2011.Units 1, 2, and 3 each operated under a 40‐year Full‐Power Operating License from the NuclearRegulatory Commission (NRC), expiring in 2025, 2026, and 2027, respectively. In April 2011, after adetailed, two‐year process, theNRC approved the application to extend the operating licenses for allthreeunitsforanadditional20years,allowingUnit1tooperatethrough2045,Unit2through2046,andUnit3through2047.San JuanProject – Effective July1, 1993, the Authority purchased a 41.80% interest in Unit 3 andrelated common facilitiesof theSan JuanGeneratingStation (SJGS) fromCenturyPowerCorporation.Unit3,a497‐MWunit,isoneunitofafour‐unitcoal‐firedpowergeneratingstationinNewMexico.Theownersof theSan JuanProject reachedanagreementonanownershiprestructuringofSan JuanthatwouldshutdownUnit3byDecember2017aspartoftheoverallsettlementofmattersregardingemissions at San Juan.Most of the regulatory approvals and other conditions have been obtained orsatisfiedinordertoimplementthisownershiprestructuring.


52

Note1–OrganizationandPurpose(continued)OnJuly16,2015,theSCPPABoardofDirectorsvotedtoexitfromtheSanJuanUnit3Projectanddivesttheir ownership interest in the Project to Public Service Company of New Mexico and PNMRDevelopmentandManagementCorporationonoraboutDecember31,2017.(SeeNote12)MagnoliaPowerProject–TheMagnoliaPowerProject(MAG)consistsofacombinedcyclenaturalgas‐firedgeneratingplantwithanominally ratednetbasecapacityof242MWandwasbuiltona site inBurbank, California. The plant is the first that iswholly owned by the Authority and entitlements to100%ofthecapacityandenergyoftheProjecthavebeensoldtosixofitsmembers.TheCityofBurbank, aProjectparticipant,managed its constructionandalso servesas theoperatingagentfortheProject.CommercialoperationsbeganonSeptember22,2005. GasSupplyandServicesAgreement–SCPPAenteredintoanagreementwithOccidentalEnergy

Marketing, Inc. (OEMI) beginning January 2005. This agreement is renewed each year unlessnotificationisgivenbyeitherpartypriortoDecember31,ofeachyear.OEMIprovides100%ofthenaturalgasplantrequirementsonadailybasis,andalsoincludesanoptionfortheparticipantstobringintheirowngassupply.Inaddition,OEMIprovidesgasbalancingservices.

NaturalGasTransportation – SCPPA has an agreement with Southern California Gas Company

(SoGas) for intrastate transmission services. The agreement took effect in January 2005 andwasrenewedinFebruary2016foranadditionalthreeyearsthereafterunlesscanceledbytheAuthoritypriortoFebruary1ofeachyear.SoGasprovidestransportation,storage,andbalancingservicesofnaturalgasfromtheSouthernCaliforniaBordertotheMagnoliaPlant.

PartsandSpecialServicesAgreement–SCPPAenteredintoan18‐yearagreementwithGeneral

ElectricInternational(GE)inSeptember2005.Initially,theagreementcoveredonlythegasturbine,but the agreement was amended in August 2007, to include coverage for the gas generator, thesteam turbine, and the steam generator. GE provides planned and unplanned maintenance,includingreplacementparts,basedonfactoredfiredhours.

CanyonPowerProject–TheCanyonPowerProject(theProject)consistsofasimplecyclenaturalgas‐firedpowergeneratingplant,comprisedoffourcombustionturbineswithacombinednominallyratednetbasecapacityof200MW,andauxiliaryfacilities,locatedinanindustrialareaofthecityofAnaheim,California(Anaheim).TheProjectisownedbytheAuthorityandconstructed,operated,andmaintainedbyAnaheim.TheProjectachievedfullcommercialoperationinSeptember2011.


53

Note1–OrganizationandPurpose(continued)ApexPowerProject–OnMarch26,2014,theAuthorityacquiredtheApexPowerProject(theProject)pursuant to an Asset Purchase Agreement, dated as of October 17, 2013. The Project consists of anaturalgas‐fired,combinedcyclegeneratingfacility(the“Facility”),nominally‐ratedat531MW,locatedin Clark County, Nevada, generator interconnection facilities, related assets and property, andinterconnectionandtransmissioncontractualrights.TheFacilityisinterconnectedthrougha3.13mile500 kV radial generation tie line owned byNevada Power Company that connects the Facility to theNevadaPowerCompany’s transmissionsystemat itsHarryAllen500kVSubstation.TheLosAngelesDepartmentofWater&Power(LADWP)servesasprojectmanagerandoperatingagentoftheProject.

Operation andMaintenance Agreement – The Facility is operated by EthosEnergy PowerOperations (West), LLC (EthosEnergy), formerlyWood Group Power Operations (West), Inc.,pursuant to an Operations andMaintenance Agreement dated February 12, 2007. Under theO&M Agreement, EthosEnergy provides all operations, routine maintenance, budget control,purchasing,billing,andreportingfortheoperationoftheFacility,otherthanthemaintenanceprovided by General Electric International (“GEI”), under a long‐term service agreement.EthosEnergy currently employs 22 people at the Facility for operation and maintenancepurposes.TheO&MAgreementinitiallybetweentheSellerandEthosEnergywasassumedandamended by the Authority. The term of the O&MAgreement,which expired on February 12,2016,hasbeenextendedtoFebruary12,2017.

Large Generator Interconnection Agreement (LGIA) – The LGIA between Nevada Power

CompanyandtheSeller,datedJuly1,2001,providesfortheinterconnectionoftheFacility,andfirm transmission service for the Facility output through a Firm Point‐to‐Point TransmissionServiceAgreementbyandbetweenNVEnergyandLADWPasAgentfortheAuthority,datedinNovember2015withapointofdeliveryattheMcCullough500kVSubstation.ThetermoftheTransmissionServiceAgreementextendstoJuly30,2023.TheAuthorityexpectstorenegotiatetheseagreementsprior to theirexpirationdate(witha termextension if it iseconomic)or toprovide for alternative transmission service from the facility to the McCullough 500 kVSubstation. The Seller’s obligation, under the Asset Purchase Agreement, is secured by aguarantyprovidedbyalimitedliabilitycompanyforaperiodof5yearsfollowingtheacquisitiondateoftheFacilitybytheAuthority.

Long‐TermServiceAgreement–Majormaintenance,includingpartssupply,partsrepairand

labor for the Facility’s combustion turbine generators and the steam turbine are providedpursuant to a Long‐Term Service Agreement (“LTSA”) between the Seller and GEI, datedJune16, 2004. It is not currently possible to determine when the LTSA will expire, but theAuthorityanticipatesthatitwillnotexpirepriortosixyearsaftertheFacilityacquisitiondate.


54

Note1–OrganizationandPurpose(continued)

OperationalBalancingAuthorityAgreementandLetterAgreement–ThenaturalgastofueltheFacilitywillbeprovidedbyLADWPanddeliveredbyfacilitiesownedbytheKernRiverGasTransmission Company through an Operational Balancing Authority Agreement and LetterAgreement.

WaterAgreement–WaterforthefacilitywillbeprovidedbyLasVegasValleyWaterDistrict

pursuanttoanagreement,datedJune5,2001andassignedtotheAuthorityuponacquisitionoftheFacility.Unlessextended,theWaterAgreementexpiresonJune5,2038.

Transmission Service Agreements (TSAs) – Under the TSAs, Nevada Power Company

currentlyprovidestransmissionservicestodelivertheoutputoftheFacilitytotheMead230kVSubstation. The rates, terms and conditions for such services are regulated by the FederalEnergyRegulatoryCommissionpursuanttoNevadaPowerCompany’sopenaccesstransmissiontariff. Changes to the rates are not accurately predictable and subject to numerous factorsunrelatedtotheApexProject.

LADWP, as theOperatingAgent,will administer, supervise,monitor andenforce theO&MAgreementandtheLTSAinaccordancewiththeAgencyAgreement.GREENPOWERHooverUpratingProject –As ofMarch1, 1986, the Authority and six participants entered into anagreementpursuanttowhicheachparticipantassigneditsentitlementtoHooverUpratingcapacityandassociated firm energy to the Authority in return for the Authority’s agreement to provide for theadvancementoffundsfortheupratingtotheUnitedStatesBureauofReclamation(USBR)onbehalfofsuchparticipants.TheagreementexpiresonSeptember30,2017.On December 20, 2011, the Hoover Power Allocation Act, which extends the availability of HooverPowertotheexistingcontractorsforanadditionalfiftyyearsandcreatesapoolfornewentrants,wassigned into law.Theparticipantswillenter intonewagreementswith the federalgovernment for thecapacityandenergy,effectivefromOctober1,2017throughSeptember30,2067.WhethertheAuthoritywillplayaroleintheprojectafter2017cannotbedeterminedatthistime.TietonHydropowerProject–OnNovember30,2009,theAuthorityacquiredtheTietonHydropowerPlantpursuanttoanAssetPurchaseAgreement,datedasofOctober19,2009.TheTietonHydropowerProject (the Project) consists of a 13.6 MW nameplate capacity “run‐of‐the‐reservoir” hydroelectricgeneration facility,comprisedof:apowerhouse located inYakimaCounty,Washington;a21‐mile115kVtransmissionline;otherrelatedassets,property,andcontractualrights.


55

Note1–OrganizationandPurpose(continued) ContractorServiceAgreement–SCPPAenteredintoanagreementwithEnergyNorthwestonJuly

1,2014todirecttheoperationsoftheTietonHydropowerfacilityandtoprovidecertaintechnicalserviceswithrespecttotheoperationandmaintenanceofthefacility.ThecontractwasextendedtoJune30, 2016 and renewedon July 1, 2016 for a termof one yearwhichmaybe extended for aperiodofonemonthtooneyearuponmutualagreementoftheparties.

FacilitiesMaintenanceAgreement–SCPPAenteredintoanagreementwithPacifiCorptoprovide

supervision, labor, materials, and equipment necessary to perform routine non‐emergencymaintenance of the facilities and routine vegetation management. The agreement started onApril28, 2010 andwill continue for as long as the Interconnection agreement is in effect, unlessterminatedbymutualagreement.

SmallGeneratorInterconnectionAgreement–SCPPAenteredintoanagreementwithPacifiCorp

toperformcertain interconnectionrequestssubmittedundertheSmallGeneratorInterconnectionProcedures. This agreement governs the terms and conditions under which SCPPA’s SmallGeneratingFacilitywillinterconnectwithPacifiCorp’sTransmissionSystem.TheagreementbecameeffectiveonNovember30,2009andwillremainineffectforaperiodof10yearsafterwhichitwillautomaticallyrenewforsuccessiveone‐yearperiods,unlessterminatedbya20‐daywrittennoticeinaccordancewiththisagreement.

Milford IWindProject–OnFebruary9,2010, theAuthority financed theprepaymentofa specifiedsupplyofelectricityfromawindfarmlocatedinMilford,Utah(theFacility).TheFacilityisa203.5MWnameplatecapacitywindfarmcomprisedof97windturbineslocatednearMilford,Utah,togetherwitha90‐miletransmissionline,andotherrelatedfacilities.UndertherelatedpowerpurchaseagreementsbyandbetweenSCPPAandMilfordWindCorridorPhaseI,LLC(theSeller),SCPPAwillreceive6.7millionMWhoursovera20‐yeardeliveryterm.SCPPAhasalsoagreedtomakemonthlypaymentstotheSellerfor any energy delivered in each year that exceeds the guaranteed annual quantity of 338,215 MWhours.CommercialoperationbeganonNovember16,2009.Milford IIWindEnergyProject –OnAugust 25, 2011, the Authority financed the prepayment of aspecifiedsupplyofenergyfromtheMilfordWindCorridorPhaseIIProject(theMilfordIIProject),foradelivery termof20years(unless terminatedearlier)pursuant toaPowerPurchaseAgreementdatedMarch1,2010. The Authority also entered into power sales agreementswith LADWP and the city ofGlendale(Glendale)tosell100%ofitsentitlementtocapacityandenergyintheFacilityona“take‐or‐paybasis.”Underaseparatecontract,thecityofGlendalesolditsentitlementshareofenergytoLADWP.TheFacilityisa102MWnameplatecapacitywindpoweredelectricgeneratingfacilitycomprisedof681.5MWwindturbinesandrelatedfacilitieslocatednearMilford,Utah.TheMilfordIIProjectachievedcommercialoperationonMay2,2011.


56

Note1–OrganizationandPurpose(continued)LindenWindEnergyProject–OnSeptember15,2010,theAuthorityacquiredtheLindenWindEnergyProject(theProject)pursuant tothetermsoftheAssetPurchaseAgreement,datedasof June23,2009.TheProjectisanapproximately50MWnameplatecapacitywindfarmcomprisedof25windturbinesandrelatedfacilities,locatedinKlickitatCounty,Washington,developedandconstructedbyNorthwestWindPartners,LLC.TheAuthorityhasalsoenteredintopowersalesagreementswithLADWPandGlendaletosell 100% of its entitlement to capacity and energy in the Project on a “take‐or‐pay” basis. Through aseparatelayoffagreement,theCityofGlendalehassold100%ofitsentitlementtocapacityandenergytoLADWP, but remains responsible for all payments associatedwith its participation in the power salesagreementifLADWPfailstobuytheenergypursuanttothelayoffagreement. OperationandMaintenance ServiceAgreement – SCPPA entered into a three‐year agreement

withSenvionWindEnergySolutions(“Senvion”)(formally,REpowerSystemsAG)inFebruary2012.This agreement automatically renews for an additional two years unless either party provideswrittennoticetotheotherpartytocancelthecontract.Senvionperformsfixedfeeservicessuchasscheduledmaintenances,periodicoperationalchecksandtests,andregularpreventivemaintenancerequired on the wind turbine generators (WEC) in accordance with the maintenance manual.Senvion also performs remote monitoring services, repair services, and services related to theavailabilityoftheWEC.TheagreementwithSenvionremainsineffectasofJune30,2016.

EnergyExchangeAgreement–SCPPAenteredintoatwo‐yearagreementwithPowerexCorp.on

November27,2012fordeliveryofenergytoPowerexforshapingandmovingservices.Thedeliverytermmaybe renewed forup to five additionalone‐year terms commencingon January1of eachsuccessive calendar year, if the parties have confirmed inwriting their agreement to extend thiscontractnotlessthanninetydayspriortothecommencementofeachrenewalterm.TheagreementwithPowerexremainsineffectasofJune30,2016.

BalanceofPlantAgreement –CannonPowerServicesCompany,LLCassumedresponsibility for

operationsoftheLindenWindEnergyProjectfromEDFRenewableEnergy(formerlyEnXcoServiceCorporation)throughanagreementwithSCPPAthatwasexecutedonJuly9,2013andwaseffectiveSeptember3,2013.Thisagreementtooperate,maintain,andrepairtheWindPlantwillcontinueforaperiodof threeyearsandwillautomaticallybeextended for successiveoneyearperiodsunlesseitherpartyprovideswrittennoticetoterminatethecontract.TheagreementwithCannonPowerServicesCompany,LLCremainsineffectasofJune30,2016.

WindyPoint/WindyFlatsProject–OnSeptember9,2010,theAuthorityfinancedthepurchaseofasupplyofenergyfromtheWindyPoint/WindyFlatsProject(theProject)foraninitialdeliverytermof20years,pursuanttothetermsofapowerpurchaseagreement,datedJune24,2009.TheAuthorityalsoentered into power sales agreements with LADWP and the city of Glendale to sell 100% of itsentitlementtocapacityandenergyintheProjectona“take‐or‐pay”basis.


57

Note1–OrganizationandPurpose(continued)Throughaseparatelayoffagreement,theCityofGlendalesold100%ofitsentitlementtocapacityandenergy to LADWP, but remains responsible for all payments associated with its participation in thepowersalesagreementifLADWPfailstobuytheenergypursuanttothelayoffagreement.TheProjectisafacilitywitha262.2MWnameplatecapacitywindfarmcomprisedof114windturbineslocated in the Columbia Hills area of Klickitat County, Washington near the city of Goldendale. TheProjectisownedbyWindyFlatsPartners,LLC,alimitedliabilitycompanyorganizedandexistingunderthelawsoftheStateofDelaware.Theinitialdeliverytermbeganonthecommercialoperationdateofthefirstoftwophasesofthefacility.ThefirstphasecommencedoperationsonJanuary25,2010andthesecondphaseonMarch1,2010.TRANSMISSIONPROJECTSSouthernTransmissionSystemProject–OnMay1,1983, theAuthorityentered intoanagreementwiththeIntermountainPowerAgency(IPA),todefrayallthecostsofacquisitionandconstructionoftheSouthernTransmissionSystemProject (STS),whichprovides for the transmissionof energybetweenthe Southern California and the Rocky Mountain regional markets, including long‐term renewableresources such as Milford I Wind and Milford II Wind, from the Intermountain Generating Stationlocated in Utah to Southern California. STS commenced commercial operations in July 1986.ConstructiontoupgradetwoAC/DCconverterstationsandincreasetheircombinedratingfrom1,920MWto2,400MWwascompletedinMay2011.TheLADWP,amemberoftheAuthority,servesasprojectmanagerandoperatingagentoftheIntermountainPowerProject(IPP).Mead‐PhoenixandMead‐AdelantoProjects‐AuthorityInterest(Members)–AsofAugust4,1992,the Authority entered into an agreement to acquire an interest in the Mead‐Phoenix Project (Mead‐Phoenix), a transmission line extending between the Westwing substation in Arizona and theMarketplacesubstationinNevada.TheagreementprovidestheAuthoritywithan18.31%interestintheWestwing‐Meadprojectcomponent,a17.76%interestintheMeadSubstationprojectcomponent,anda22.41%interestintheMead‐Marketplaceprojectcomponent.AsofAugust4,1992,theAuthorityalsoenteredintoanagreementtoacquirea67.92%interestintheMead‐AdelantoProject(Mead‐Adelanto),atransmissionlineextendingbetweentheAdelantosubstationin Southern California and the Marketplace substation in Nevada. Funding for these projects wasprovidedbyatransferoffundsfromtheMultipleProjectFundandcommercialoperationscommencedinApril1996.LADWPservesasprojectmanagerandoperatingagentofMead‐Adelanto.Mead‐PhoenixandMead‐AdelantoProjects‐AuthorityInterest(LADWP)OnMay25, 2016 theAuthority acquired all ofM‐S‐RPublic PowerAgency’s (“MSRPPA”) ownershipinterestsandassociatedparticipationshareandrelatedrightsandinterestsintheMead‐Adelanto(MA)andtheMead‐Phoenix(MP)ProjectsonbehalfofLADWP.


58

Note1–OrganizationandPurpose(continued)The Authority Interest (LADWP) in Mead‐Adelanto and in Mead‐Phoenix, collectively the “AuthorityInterests(LADWP)”, isseparateanddistinctfromtheAuthorityInterest(Members)andtheAuthorityInterest(Western)intheexistingMAandMPProjects.Theacquisitionrepresentsanadditional17.5%ownership share in theMA Project and an additional 11.53850% ownership share in theWestwing‐MeadComponentandanadditional8.0993%ownershipshareintheMead‐MarketplaceComponentoftheMPProject,pursuanttoaPurchaseandSaleAgreementdatedAugust31,2015betweenMSRPPAand the Authority. Pursuant to separate Transmission Service Contracts (LADWP), each dated as ofMarch17,2016,LADWPisentitledtotransmissionservicesusing100%oftheavailablecapabilityoftheAuthorityInterests(LADWP)intheMAandMPProjects.NATURALGASPROJECTSPinedaleProject–OnJuly1,2005,theAuthority,togetherwithLADWPandTurlockIrrigationDistrict(TID), acquired 42.5% of an undivided working interest in three natural gas leases located in thePinedaleAnticline regionof theStateofWyoming.TheAuthority’s individual share in these interestsequals 14.9%. The purchase includes 38 operating oil and gaswells and associated lateral pipelines,equipment,permits,rightsofway,andeasementsusedinproduction.Thenaturalgasfieldproductionisexpectedto increaseforseveralmoreyearsasadditionalcapital is investedondrillingnewwellsandthendeclineoveralifeexpectancygreaterthan30years. JointOperatingAgreement (JOA) – In July 2005, SCPPA’s purchase of the natural gas reserve

interestsatPinedale,Wyoming(Pinedale)includedanunderlyinglong‐termJOAwiththeoperator,Ultra Resources, Inc. (“Ultra”). SCPPA pays the operator for SCPPA’s share of both operating anddrilling/capitalexpensesonamonthlybasis.Ultra‐ResourcesInc.,filedforChapter11onApril29,2016afterfailingtoreachadebt‐restructuringagreementwithitslendersandbondholders.UltracontinuesastheProjectOperatorandhasmadenosignificantchangestotheoperationoftheproject.Currently,thereisnoeffectontheparticipantsofthePinedaleProject.

Gathering and processing agreements – SCPPA’s purchase of Pinedale included underlying

agreements with Jonah Gas Gathering Company, Tesoro Logistics, formerly Questar GasManagementCompany,andWesternGasResources,Inc.forgatheringandprocessingofthenaturalgas.


59

Note1–OrganizationandPurpose(continued)Barnett Project – Natural gas resources in the Barnett shale geological formation in Texas wereacquiredfromCollinsandYoungHolding,L.L.P(C&Y)foratotalof$84million.TheacquisitionsettledonOctober26,2006andwascompletedonDecember7,2006whentheparticipants,togetherwithTID,exercisedtheiroptiontopurchaseadditionalresourcesfromC&Y. JointOperatingAgreement(JOA)–InOctober2006,SCPPA’spurchaseofthenaturalgasreserve

interests inBarnett,TX (Barnett) includedanunderlying long‐term JOAwith theoperator,DevonEnergyProductionCompany,L.P.SCPPApaystheoperatorforSCPPA’sshareofbothoperatinganddrilling/capitalexpensesonamonthlybasis.

PrepaidNaturalGasProject–OnOctober 11, 2007, theAuthoritymade a one‐timeprepayment of$481million to acquire the right to receive approximately 135 billion cubic feet of natural gas fromJ.Aron&Company(J.Aron)tobedeliveredovera30‐yearterm,beginningJuly1,2008.OnOctober3,2007,priortotheacquisitionoftheprepaidgassupply,theAuthorityenteredintofiveseparatePrepaidNaturalGasSalesAgreements(theGasSalesAgreements)withJ.Aronandsimultaneously,fivePrepaidNaturalGasSupplyAgreements(theGasSupplyContracts)inwhichtheAuthoritysolditsinterestinthenaturalgas,ona“take‐and‐pay”basis,tothecitiesofAnaheim,Burbank,Colton,Glendale,andPasadena(the Project Participants). Through the Gas Supply Contracts, SCPPA has provided for the sale to theProjectParticipants,onapay‐as‐you‐gobasis,ofallofthenaturalgastobedeliveredtoSCPPApursuanttotheGasSalesAgreements.

OnOctober22,2009,thePrepaidNaturalGasSalesAgreementsandcertainotheragreementswererestructuredtoreducerisk,provideanaccelerationofaportionofthelong‐termsavings,reducetheremainingvolumesofgastobedeliveredfrom135billionto90billioncubicfeet,andshortenthetermoftheagreementsfrom30yearsto27years.Asaresultoftherestructuring,the Natural Gas contracts will now expire in 2035 and $165.5 million principal of the 2007NaturalGasProjectBondswereterminated(seeNote7).


60


UndertheGasSupplyContracts,theapproximateaverageDailyQuantityofgastobepurchasedbyeachProjectParticipantisasfollows:

Revised Original ParticipantVolumes Volumes Percentage(%)

CityofAnaheim 1,467 2,000 16.5%CityofBurbank 2,924 4,000 33.0%CityofColton 1,007 1,375 11.0%CityofGlendale 2,015 2,750 23.0%CityofPasadena 1,464 2,000 16.5%

Total 8,877 12,125 100.0%

(1)TheAverageDailyQuantityisinMMBtuandiscalculatedoverthetermoftheapplicableGasSupplyContracts.ThecontractswererestructuredandvolumesrevisedinOctober2009.

AverageDailyQuantity(1)

ProjectParticipant

Participantownershipinterests–TheAuthority’sparticipantsmayelecttoparticipateintheprojects.As of June 30, 2016, the members have the following participation percentages in the Authority’soperatingprojects:


CanyonPower

ApexPower


SystemMead‐Phoenix

Mead‐Adelanto

CityofLosAngeles 67.0% ‐ ‐ ‐ 100.0% 59.5% 50.4% 48.9%CityofAnaheim ‐ ‐ 38.0% 100.0% ‐ 17.6% 15.7% 10.7%CityofRiverside 5.4% ‐ ‐ ‐ ‐ 10.2% 2.7% 10.7%ImperialIrrigationDistrict 6.5% 51.0% ‐ ‐ ‐ ‐ ‐ ‐CityofVernon 4.9% ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofAzusa 1.0% 14.7% ‐ ‐ ‐ ‐ 0.7% 1.8%CityofBanning 1.0% 9.8% ‐ ‐ ‐ ‐ 0.7% 1.1%CityofColton 1.0% 14.7% 4.2% ‐ ‐ ‐ 0.7% 2.0%CityofBurbank 4.4% ‐ 31.0% ‐ ‐ 4.5% 10.2% 9.2%CityofGlendale 4.4% 9.8% 16.5% ‐ ‐ 2.3% 9.7% 8.8%CityofCerritos ‐ ‐ 4.2% ‐ ‐ ‐ ‐ ‐CityofPasadena 4.4% ‐ 6.1% ‐ ‐ 5.9% 9.2% 6.8%

100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

TRANSMISSION

Participants

GENERATION


61


HooverUprating

TietonHydro‐power

MilfordIWind

MilfordIIWind

LindenWindEnergy

WindyPoint Pinedale Barnett

PrepaidNaturalGas

CityofLosAngeles ‐ ‐ 92.5% 95.1% 90.0% 92.4% ‐ ‐ ‐CityofAnaheim 42.6% ‐ ‐ ‐ ‐ ‐ 35.7% 45.4% 16.5%CityofRiverside 31.9% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ImperialIrrigationDistrict ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofVernon ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofAzusa 4.2% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofBanning 2.1% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofColton 3.2% ‐ ‐ ‐ ‐ ‐ 7.1% 9.1% 11.0%CityofBurbank 16.0% 50.0% 5.0% ‐ ‐ ‐ 14.3% 27.3% 33.0%CityofGlendale ‐ 50.0% ‐ 4.9% 10.0% 7.6% 28.6% ‐ 23.0%CityofCerritos ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofPasadena ‐ ‐ 2.5% ‐ ‐ ‐ 14.3% 18.2% 16.5%

100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Participants

GREENPOWER NATURALGAS

TheAuthorityhasenteredintopowersales,naturalgassales,andtransmissionserviceagreementswiththeaboveprojectparticipants.Underthetermsofthecontracts,theparticipantsareentitledtopoweroutput,naturalgas,or transmissionservice,asapplicable.Theparticipantsareobligatedtomakepaymentsona“take‐or‐pay”basisfortheirproportionateshareofoperatingandmaintenanceexpensesanddebtservice.The contracts cannot be terminated or amended in anymanner thatwill impair or adversely affect therightsofthebondholdersaslongasanybondsissuedbythespecificprojectremainoutstanding.


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Note1–OrganizationandPurpose(continued)Thecontractsexpireasfollows:PaloVerdeProject 2030SanJuanProject 2030MagnoliaPowerProject 2036CanyonPowerProject 2040ApexPowerProject 2038HooverUpratingProject 2018TietonHydropowerProject 2040MilfordIWindProject 2030MilfordIIWindProject 2031LindenWindEnergyProject 2035WindyPointProject 2030SouthernTransmissionSystemProject 2027Mead‐PhoenixProject 2030Mead‐AdelantoProject 2030NaturalGasPinedaleProject 2040NaturalGasBarnettProject 2040PrepaidNaturalGasProject 2038OrmatGeothermalEnergyProject 2031PebbleSpringsWindProject 2025MWDSmallHydroProject 2023AmerescoChiquitaLandfillGasProject 2030DonA.Campbell/WildRoseGeothermalProject 2033CopperMountainSolar3Project 2040Columbia2SolarProject 2033DonA.Campbell2Project 2035Heber‐1GeothermalProject 2025KingbirdSolarProject 2035

TheAuthority’sinterestsorentitlementsinnaturalgas,generation,andtransmissionprojectsarejointlyownedwithotherutilities,except for theMagnoliaPowerProject,CanyonPowerProject,ApexPowerProject,TietonHydropowerProject,andtheLindenWindEnergyProject,whicharewhollyownedbytheAuthority.Underthesearrangements,aparticipatingmemberhasanundividedinterestinautilityplant and is responsible for its proportionate share of the costs of construction andoperation and isentitled to its proportionate share of the energy, available transmission capacity, or natural gasproduced.Eachjointplantparticipant, includingtheAuthority, isresponsibleforfinancingitsshareofconstructionandoperatingcosts.ThefinancialstatementsreflecttheAuthority’sinterestineachjointlyownedprojectaswellas theprojects that itowns.Additionally, theAuthority’s shareofexpenses foreachprojectisincludedinthestatementsofrevenues,expenses,andchangesinnetpositionaspartofoperationsandmaintenanceexpenses.


63

Note1–OrganizationandPurpose(continued)POWERPURCHASEAGREEMENTSOrmat Geothermal Energy Project – The Authority entered into long‐term power purchaseagreements inDecember2005withdivisionsofOrmatTechnologies, Inc. forup to20MWofelectricgeneration. The Project started delivery of approximately 5 MW in January 2006 from geothermalenergy facilities located in Heber, California, and the agreements were amended to allow for excesscapacity inMay2008.ThecityofAnaheimactsas theschedulingcoordinatoronbehalfof theprojectparticipants.Thetermofthecontractis25years.MWDSmallHydroProject–Consistsofapowerpurchaseagreementfortheoutput fromfoursmallhydroelectric plants on theMWD system in SouthernCalifornia, having a total nameplate capacity of17.04MW,andahistoricaloutputof40,130MWHperyear.TransmissionisaccomplishedthroughtheCaliforniaIndependentSystemOperator,withthecityofAnaheimactingasscheduler.Thetermofthecontractis15yearsand2months,expiringDecember31,2023.OperationsbeganonNovember1,2008.Pebble SpringsWind Project – In December 2007, the Authority entered into a power purchaseagreement for the facility output of awind projectwith98.7MW, located inGilliamCounty,Oregon.SCPPAalongwithLADWP,Burbank,andGlendalearenowschedulingtheenergythroughtransmissionagreementswhichbringthisrenewableenergyfromtheprojectsubstationtotheprojectparticipants.ThetermoftheProject is18yearswitharightof firstoffertopotentiallypurchasetheentireprojectafterthe10thcontractyear.OperationsformallybeganonJanuary31,2009.AmerescoChiquitaEnergyProject–InMarch2004,SCPPAenteredintoapowerpurchaseagreementwithAmerescoChiquitaEnergyLLC,subsequentlyamendedinSeptember2006,for100%oftheelectricgeneration from a landfill gas to energy facility located at the landfill site in Valencia, California(AmerescoLandfillGas toEnergyProject).TheSCPPAparticipants in theproject include the citiesofBurbank and Pasadena. This projectwill initially be for 10MWwith the right of first refusal on anyincreaseinoutput.OperationsbeganinNovember2010.Thetermofthecontractis20yearsfromthecommercialoperationdate.Don A. Campbell/Wild Rose Geothermal Energy Project – On December 31, 2012 the AuthorityenteredintoapowerpurchaseagreementwithOrmatNevada,Inc.topurchaserenewablegeothermalenergyfromtheDonA.Campbell/WildRoseFacility(the“Facility”)beginningDecember31,2013,fora20‐yearterm.TheFacilityisageothermalpowergeneratingfacilitywitha16.2MWnameplatecapacityanda95percentcapacityfactorlocatedinMineralCounty,Nevada.ThecommercialoperatingdatewasDecember 31, 2013 but early delivery of energy began in November 2013. The two participants areLADWP and the city of Burbank. LADWP acts as projectmanager and has balancing authority at thepoint of delivery of energy at the Mead 230kV Substation in Southern Nevada. Electricity from theProjectwillbetransmittedthroughNevadaEnergy’stransmissionsystemthatincludesthenew500kVOneNevadaTransmissionLine.


64

Note1–OrganizationandPurpose(continued)CopperMountain Solar 3 Project – On August 31, 2012, SCPPA entered into a power purchaseagreement with Sempra U.S. Gas and Power to purchase certain renewable energy and associatedenvironmental attributes from the Copper Mountain Solar 3 Facility. The Facility is a fixed tiltphotovoltaic systemwith a capacity of 250 MW located near Boulder City, Nevada. Full commercialoperationwas achieved on December 31, 2015. The term of the contract is 20 years. LADWP is theschedulingcoordinatoronbehalfoftheparticipants.Columbia2SolarProject–OnSeptember19,2013,SCPPAenteredintoapowerpurchaseagreementwithREColumbiaTwo,LLCtopurchasealloftheoutputoftheColumbia2SolarProject,andtoacquireotherrightsandresources,includingbutnotlimitedtothepurchaseoptionandtherightsunderotherancillaryagreementsassociatedwiththeproject.Theproject isaphotovoltaicsolarpowergeneratingfacility locatedinKernCounty,Californiawithanexpectednameplatecapacityof15MW.CommercialoperationbeganonDecember20,2014.Thetermofthecontractis20years.TheCityofRiversideistheschedulingcoordinatoronbehalfoftheparticipants.DonA.Campbell2GeothermalEnergyProject–OnDecember18,2014theAuthorityenteredintoapowerpurchaseagreementwithORNI37LLCtopurchaserenewablegeothermalenergyfromtheDonA. Campbell 2 Facility (DAC2) beginning December 31, 2016, for a 20‐year term. The Facility is ageothermal power generating facilitywith a 16.2MWnameplate capacity and a 95% capacity factorlocatedinMineralCounty,Nevada.ThecommercialoperatingdatewasSeptember17,2015,butearlydelivery of energy began in August 2015. The LADWP acts as project manager and has balancingauthorityatthepointofdeliveryofenergyattheMead230kVSubstationinSouthernNevada.Electricityfrom theProjectwill be transmitted throughNevadaEnergy’sTransmissionSystem that includes thenew500kVOneNevadaTransmissionLine.Consequently, theDonA.Campbell/WildRoseFacility isnowcalledDonA.Campbell1todistinguishfromtheexpansion,DAC2.TheAuthorityhasenteredintopowerpurchaseagreementswithprojectparticipantsasfollows.Theseagreements are substantially “take‐and‐pay” contracts where there may be other obligations notassociatedwiththedeliveryofenergy.


65

Note1–OrganizationandPurpose(continued)ParticipantOwnershipInterests


PebbleSpringsWind

MWDSmallHydro

AmerescoChiquitaLandfillGas



Columbia2Solar


Heber‐1Geothermal

KingbirdSolar

17.00MW 98.70MW 17.04MW 10.00MW 16.00MW 250.00MW 15.00MW 25.00MW 62.5MW 20.00MW

CityofLosAngeles ‐ 69.6% ‐ ‐ 84.6% 84.0% ‐ 100.0% 66.7% ‐CityofAnaheim 60.0% ‐ 56.4% ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofImperial ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 33.3% ‐CityofRiverside ‐ ‐ ‐ ‐ ‐ ‐ 74.3% ‐ ‐ 70.0%CityofAzusa ‐ ‐ 21.8% ‐ ‐ ‐ 8.6% ‐ ‐ 15.0%CityofBanning 10.0% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofColton ‐ ‐ 21.8% ‐ ‐ ‐ ‐ ‐ ‐ 15.0%CityofBurbank ‐ 10.1% ‐ 16.7% 15.4% 16.0% ‐ ‐ ‐ ‐CityofGlendale 15.0% 20.3% ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐CityofPasadena 15.0% ‐ ‐ 83.3% ‐ ‐ 17.1% ‐ ‐ ‐

100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%

Contractexpires 2031 2025 2023 2030 2033 2040 2033 2035 2025 2035

Participants

Capacity

PowerPurchaseAgreements

MISCELLANEOUSFUNDSProjectDevelopmentFund–Holdsfundsrelatedtoprojectsinthedevelopmentphase.Projects’StabilizationFund–Infiscalyear1997,theAuthorityauthorizedthecreationofaProjects’StabilizationFund.Depositsmaybemadeintothefundfrombudgetunder‐runs,afterauthorizationofindividualparticipants,andbydirectcontributions fromtheparticipants.Participantshavediscretionover theuseof theirdepositswithinSCPPAprojectpurposes.This fund isnotaproject‐related fund;therefore,itisnotgovernedbyanyprojectIndentureofTrust.ThemembersparticipateintheProjects’StabilizationFundbymakingdepositstothefundattheirdiscretion.SCPPAFund – In June 2011, the Authority acquired an 11,500 sq. ft. building located in the City ofGlendora to be used as SCPPA office facilities. Acquisition and construction costs were financed bycontributions fromSCPPAmembersandthebuildingwasput intoserviceduring fiscalyear2012.Allcosts associated with the management, administration, and ongoing operations of the SCPPA OfficeBuildingaredeemedtobeSCPPAoverheadcostsandwillbebudgetedandpaidinaccordancewiththeprojectsannualbudgetspursuanttoSCPPA’straditionalbudgetaryprocess.OnJuly18,2013,theSCPPABoardauthorizedtheinstallationofSolarVoltaicEquipmentandCarportsattheSCPPAGlendoraOfficeBuilding.TheestimatedcostwasfinancedbytheSCPPAMembersinaccordancewiththeirownershipinterestsintheSCPPABuilding.OnJanuary21,2016,theSCPPABoardofDirectorsapprovedResolutionNo.2016‐003authorizingthepurchaseandrenovationofthebuildingadjacenttotheofficebuildingthatSCPPAcurrentlyowns.Theacquisition will be allocated to each member based on the methodology that was used to fund thepurchaseofthecurrentSCPPAOfficeBuildingwhichwasacquiredinJune2011.(SeeNote3).


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Note2–SummaryofSignificantAccountingPoliciesBasis of accounting and presentation – The combined and individual financial statements of theAuthorityarepreparedundertheaccrualbasisofaccountinginaccordancewithaccountingprinciplesgenerallyaccepted in theUnitedStatesofAmerica issuedby theGovernmentalAccountingStandardsBoard(GASB)applicable togovernmentalentities thatuseproprietary fundaccounting.Revenuesarerecognizedwhenearnedandexpensesarerecognizedwhen incurred.The formatof theStatementofNet Position follows the inverted approach which is consistent with the Federal Energy RegulatoryCommission(FERC).InFebruary2015,theGASBissuedStatementNo.72,FairValueMeasurementandApplication,effectiveforfinancialstatementsforyearsbeginningafterJune15,2015.Thisstatementclarifiesthedefinitionoffair value, establishes general principles for measuring fair value, provides additional fair valueapplication guidance, and enhances disclosures about fair value measurements. This statementestablishesathree‐levelhierarchytothevaluationtechniquesusedtomeasurefairvalue.Disclosureisrequired to bemade about fair valuemeasurements, the level of fair value hierarchy, and valuationtechniques. SCPPA implemented this statement during fiscal year 2016 and reports its assets andliabilitiesaccordinglyinNote6.In June 2012, the GASB issued Statement No. 68, Accounting and Financial Reporting for Pensions,effectiveforfinancialstatementperiodsbeginningafterJune15,2014.Thisstatementisanamendmentof GASB StatementNo. 27 and provides guidance for accounting for net pension liabilities, includingdefinition of balances to be included in deferred inflows and deferred outflows of resources. TheAuthority adopted this guidance as of and for the year ended June 30, 2015. The specific accountsimpactingtheAuthorityareincludedwithintheSCPPAFundandaredetailedinNote11.InJune2012,theGASBissuedStatementNo.63,FinancialReportingofDeferredOutflowsofResources,Deferred InflowsofResources,andNetPosition, effective for financial statement forperiodsbeginningafterDecember15,2011.Inadditiontoassetsandliabilities,thecombinedfinancialstatementsincludedeferred outflows and deferred inflows or resources, and reports net position instead of net assets(deficit).Other than the change inpresentation, therewasno impact to the financial statements as aresultofthisimplementation.Netposition:TheAuthority’snetpositionisclassifiedasfollows: Netinvestmentincapitalassets–Thiscomponentofnetpositionconsistsofcapitalassets,netof

accumulateddepreciation,reducedbytheoutstandingbalancesofanybonds,otherborrowings,andadvancesfromparticipantsthatareattributabletotheacquisition,construction,orimprovementofthoseassets. If therearesignificantunspent relateddebtproceedsatyear‐end, theportionof thedebt attributable to the unspent proceeds is not included in the calculation of net investment incapitalassets.Rather,thatportionofthedebtisincludedinthesamenetpositioncomponentastheunspentproceeds.


67

Note2–SummaryofSignificantAccountingPolicies(continued) Restricted–Thiscomponentconsistsofnetpositiononwhichconstraintsareplacedastotheiruse.

Constraints includethoseimposedbycreditors(suchasthroughdebtcovenants),contributors,orlaws or regulation of other governments or constraints imposed by law through constitutionalprovisionsorthroughenablinglegislation.

Unrestricted – This component of net position consists of net position that does not meet the

definitionof“restricted”or“netinvestmentincapitalassets.”Useofestimates–Thepreparation of financial statements in conformitywith accountingprinciplesgenerally accepted in the United States of America requires management to make estimates andassumptionsthataffectthereportedamountsofassetsandliabilitiesanddisclosureofcontingentassetsand liabilitiesat thedateof thecombined financialstatementsandthereportedamountsofrevenuesandexpensesduringthereportingperiod.Actualresultscoulddifferfromthoseestimates.Utility plant – The Authority’s share of construction and betterment costs, natural gas reserves,intangibles,andnuclearfuelassociatedwithPVNGS,STS,Mead‐Phoenix,Mead‐Adelanto,SJGS,MagnoliaPower Project, the Natural Gas Pinedale Project and the Natural Gas Barnett Project (together theNatural Gas Projects) Canyon Power, TietonHydropower, LindenWind Energy, and the Apex PowerProjectsareincludedasutilityplantandrecordedatcost.UtilityplantalsoincludestheSCPPABuilding.Costs include labor,materials, capitalized interest costs on funds used in construction, and allocatedindirect charges such as engineering, supervision, transportation and construction equipment,retirementplancontributions,healthcarecosts,andcertainadministrativeandgeneralexpenses.Thecosts of routine maintenance, repairs, and minor replacements incurred to maintain the plant inoperatingconditionarechargedtotheappropriateoperationsandmaintenanceexpenseaccountsintheperiod incurred.Theoriginal costofproperty retired,netof removal and salvage costs, is charged toaccumulateddepreciation.Depreciationexpenseiscomputedusingthestraight‐linemethodbasedontheestimatedservicelives,principally 55 years for PVNGS, STS, Mead‐Phoenix and Mead‐Adelanto; 30 years for Magnolia andCanyon Power Project; 37 years for SJGS; 50 years for the Tieton Hydropower Project; 25 years forLindenWindEnergyProject;24YearsfortheApexPowerProject;and35yearsfortheSCPPABuildingFund.Naturalgasreservedepletion–DepletionexpensefortheNaturalGasProjectsiscomputedusingtheunitofproductionmethodbasedonthefutureproductionoftheprovenproducingwells,estimatedat50 years for the Natural Gas Pinedale Project and 50 years for the Natural Gas Barnett Project. TheestimateisbasedonsitespecificstudiespreparedbyindependentconsultantsasofDecember2014forboth projects. The depletion rate for the Natural Gas Pinedale Project was $3.68/MMBtu; and theestimated total net revenue volumewas 10,685,101MMBtu and 11,598,794MMBtu, for fiscal years2016and2015,respectively.


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Note2–SummaryofSignificantAccountingPolicies(continued)Thedepletion rate for theNaturalGasBarnett Projectwas $4.86/MMBtu and $4.83/MMBtu; and theestimated total net revenue volume was 9,538,994 MMBtu and 10,441,378 MMBtu, for fiscal yearsendedJune30,2016and2015,respectively.Nuclearfuel–Nuclearfuelisamortizedandchargedtoexpenseonthebasisofactualthermalenergyproducedrelative to total thermalenergyexpected tobeproducedover the lifeof the fuel.Under theprovisionsof theNuclearWastePolicyActof1982, the federalgovernmentassesseseachentitywithnuclear operations, including the participants in PVNGS, $1 perMWhour of nuclear generation. TheAuthority records this charge as a current year expense. See Note12 for information about spentnuclearfueldisposal.Nucleardecommissioning–DecommissioningofPVNGSisexpectedtocommencesubsequenttotheyear2046.ThetotalcosttodecommissiontheAuthority’sinterestinPVNGSisestimatedtobe$142.4million in 2014 dollars ($730.4 million in 2042 dollars). This estimate is based on an updated sitespecificstudypreparedbyanindependentconsultantin2013.TheAuthorityisprovidingforitsshareoftheestimatedfuturedecommissioningcostsovertheremaininglifeofthenuclearpowerplantthroughannualchargestoexpense,whichamountedto$18.0millionand$7.6millioninfiscalyears2016and2015, respectively. The decommissioning liability is included as a component of accumulateddepreciationandwas$268.3millionand$250.3millionatJune30,2016and2015,respectively.TheAuthoritycontributestoexternaltrustssetupinaccordancewiththeArizonaNuclearPowerPlantparticipation agreement and Nuclear Regulatory Commission requirements. As of June 30, 2016,decommissioning funds totaledapproximately$174.7million, includingapproximately$0.8millionofinterestreceivable.Asset retirementobligation –Demolition of SJGS is projected to commence subsequent to the year2030.Baseduponthestudyperformedbyanindependentengineeringfirm,theAuthority’sshareoftheestimateddemolitioncosts is$32.8millionin2013dollars.TheAuthority isprovidingfor itsshareoftheestimatedfuturedemolitioncostsovertheremaininglifeofthepowerplantthroughannualchargesto expense of $1.5 million. The demolition liability is included as a component of accumulateddepreciationandtotaled$59.0millionand$57.5millionatJune30,2016and2015,respectively.As of June 30, 2016, the Authority has not billed participants for the cost of demolition nor has itestablishedademolitionfund.San Juan reclamation liability– The Authority has certain obligations relating to its ownershipinterests in the SJGS Unit 3, to participate in the development of plans and arrangements for theeventual reclamation of the San Juan Coal Mine after the expiration in December 2017 of theUndergroundCoalSalesAgreementdatedAugust31,2001.


69

Note2–SummaryofSignificantAccountingPolicies(continued)The Authority is providing for its share of the estimated future reclamation costs through annualcharges to expense. The reclamation liability is included as a component of accumulated reclamationcostsandwas$7.9millionatJune30,2016.TheAuthoritycontributestoaReclamationTrustFundsetupinaccordancewiththeMineReclamationTrust Funds Agreement among the San Juan Participants, dated June 1, 2012. As of June 30, 2016,reclamationfundstotaled$6.7million.Investments – Investments include United States government and governmental agency securities,guaranteedinvestmentcontracts,mediumtermnotes,andmoneymarketaccounts.Theseinvestmentsarereportedat fairvalueandchanges inunrealizedgainsand lossesarerecordedinthestatementofrevenues, expenses, and changes in net position with the exception of the guaranteed investmentcontractswhicharerecordedatamortizedcost.Gainsandlossesrealizedonthesaleofinvestmentsaregenerallydeterminedusingthespecificidentificationmethod.The Bond Indentures for the Projects require the use of trust funds to account for the Authority’sreceiptsanddisbursements.CashandinvestmentsheldinthesefundsarerestrictedtospecificpurposesasstipulatedintheBondIndentures.Accounts receivable – Accounts receivable consists primarily of participant receivables. As such noallowanceisdeemednecessary.Prepaidandotherassets–SCPPAenteredintoaprepaidgascontractwithasupplierfora30‐yeargassupply at a fixed discount and simultaneously entered into a contract with each of the projectparticipantsforthedeliveryofnaturalgas.Theprepaidcontractsweresubsequentlyrestructuredandthe term of the agreements were shortened to 27 years. SCPPA has also entered into 20‐year termprepaidcontractsforalloftheenergygeneratedbytheMilfordIWind,MilfordIIWind,andtheWindyPoint/Windy Flats Facilities,with corresponding power sales contractswith each project participant.(SeeNote1).Advancesforcapacityandenergy–AdvancepaymentstotheUnitedStatesBureauofReclamationfortheupratingofthe17generatorsattheHooverPowerPlantareincludedinadvancesforcapacityandenergy. These advances are being reduced by the principal portion of the credits on billings to theAuthorityforenergyandcapacity.ThecurrentportionoftheseadvancesisrecordedunderPrepaidandOtherAssetsintheCurrentAssetsSectionoftheCombinedStatementsofNetPosition.AdvancetoIPA–AdvancetoIPAconsistsofcashtransferredtoIPAforreserve,contingency,andself‐insurancefundingandrelatestotheSTSProject.


70

Note2–SummaryofSignificantAccountingPolicies(continued)Unamortizedpremiumsanddiscounts–Unamortizedpremiumsanddiscountsarerecordedaspartoflong‐termdebtandamortizedoverthelifeoftherelateddebtissue.Cashand cashequivalents–Cash and cash equivalents include cash and investmentswith originalmaturitiesof90daysorless.Restrictedcashand investments–Restrictedcashand investmentsaresetaside tomeetexternallyimposedlegalandcontractualobligations.RestrictedcashandinvestmentsareusedinaccordancewiththeirrequirementsandincludecertainproceedsoftheAuthority’srevenuebonds,aswellasresourcessetasidefortheirrepayment,andparticipantadvancesrestrictedforcostsofcertaincapitalprojects.Deferred outflow and inflow of resources – Losses on refunding related to bonds redeemed byrefundingbondsarereportedasdeferredoutflowsofresourcesandareamortizedovertheshorterlifeof the refunding bonds, or the remaining term of bonds in accordancewith GASB Statement No. 23,AccountingandFinancialReportingforRefundingsofDebtReportedbyProprietaryActivities.Inaddition, theaccumulateddecrease inthe fairvalueofeffectivehedgingderivative instrumentsarereportedasdeferredoutflowofresources.Underhedgeaccounting,thechangesinthefairvalueofaneffectivehedgingderivativeinstrument,inassetorliabilitypositions,arereportedasadeferredinflowofresourcesordeferredoutflowofresources,respectively,ontheStatementsofNetPosition.SeeNote11foradescriptionofthedeferredoutflowsofresourcesandthedeferredinflowsofresourcesrelatedtothepension.Materials and supplies – Materials and supplies consist primarily of items for construction andmaintenanceofplantassetsandarestatedatthelowerofcostormarket.Arbitragerebateandyieldrestrictions–Theunusedproceedsfromtheissuanceoftax‐exemptdebthavebeeninvestedintaxablefinancialinstruments.Theexcessofearningsoninvestments,ifany,overtheamountthatwouldhavebeenearnediftheinvestmentshadayieldequaltothebondyieldoryieldrestricted rate, is payable to the IRS within five years of the date of the bond offering and eachconsecutivefiveyearsthereafteruntilfinalmaturityoftherelatedbonds.


71

Note2–SummaryofSignificantAccountingPolicies(continued)Pensions – For purposes of measuring the net pension liability and deferred outflows/inflows ofresources related to pensions, and pension expense, information about the fiduciary net position ofSCPPA’s California Public Employees’ Retirement System (CalPERS),Miscellaneous plans (Plans), andadditionsto/deductionsfromthePlans’fiduciarynetpositionhavebeendeterminedonthesamebasisas they are reported to CalPERS. For this purpose, benefit payments (including refunds of employeecontributions)arerecognizedwhendueandpayableinaccordancewiththebenefitterms.Investmentsarereportedatfairvalue.Revenues–Revenuesconsistofbillingstoparticipantsforthesalesofelectricenergy,naturalgas,andtransmissionserviceinaccordancewiththeparticipationagreements.Generally,revenuesarefixedataleveltorecoveralloperatingandanydebtservicecostsoverthecommerciallifeoftheproperty.InSeptember1998,thePaloVerdeparticipantsapprovedaresolutionauthorizingtheAuthoritytobillthe participants an additional $65million annually through June 30, 2004 to pay for increased debtservicecostsasaresultofarefundingcompletedinOctober1997.Inaddition,theparticipantsresolvedto transfer any over billings, renewal and replacement excess funds, or surplus amounts throughJune30, 2004 into the Palo Verde reserve account. On November 20, 2003, the Authority adopted aresolutiontoutilizetheamountsondepositinthereserveaccountstopayaportionoftheoperatingandmaintenanceexpensesofthePaloVerdeProjectstartingJuly1,2004.Fundsheldinthereserveaccountas a result of this resolution totaled $7.4 million and $14.5 million as of June 30, 2016 and 2015,respectively.Transportationcosts–AsaresultofthesalesandpurchasesagreementsfornaturalgasenteredintobySCPPA,theparticipantsreceivelessvolumethanprocessedincurringembeddedtransportationcosts.Thesecostsarerecordedasparticipants’revenueandexpensetotheNaturalGasPinedaleProject.AtJune30,2016and2015,transportationcostswereapproximately$147,000and$179,000,respectively,fortheNaturalGasPinedaleProject.Non‐exchangecontribution–EachparticipantoftheMagnoliaPowerPlantisresponsibleforitsownshareofnaturalgas.TheymayelecttobringfueltotheplantorpurchasefuelfromOccidentalEnergyMarketing, Inc. (OEMI).OEMI computes thedaily imbalancesof fuel volumeperparticipantusing thedaily consumption data that the operating manager provides. Monthly, actual fuel burnt is reportedtogetherwiththedailyimbalances,participants’inkindcontribution,andfuelpurchasesfromOEMI.Non‐exchange contributions are valued at fairmarket value and recorded asparticipant revenue andfuel expense to the Magnolia Power Project. SCPPA values the participants’ fuel contribution usingmonthlyaveragepricingfromtheProject’sOEMIfuelpurchases.DuringthefiscalyearsendedJune30,2016and2015,theparticipants’contributioninkindwasapproximately10.1MMBtuand10.3MMBtuandwasvaluedatapproximately$25.5millionand$37.1million,respectively.


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Note2–SummaryofSignificantAccountingPolicies(continued)Build America Bonds (BABs) – These are taxable municipal bonds that were created under theAmericanRecoveryandReinvestmentActof2009,andcarryspecialtaxcreditsandfederalsubsidiesforeitherthebondissuerorthebondholder.BABsprovideforasubsidypaymentfromtheDepartmentoftheTreasurytobepaiddirectlytotheissuer(DirectPayment)orthebondholder(TaxCreditBABs)inanamountequalto35%ofthebond’sinterest.OnJune9,2010,SCPPAissued$191millionofCanyonPower 2010 Series B, Direct Payment BABs. $41.5million of the LindenWind 2010 Series B, DirectPaymentBABs,wereissuedonSeptember28,2010.Thebudgetsequestrationorautomaticspendingcutsof theUnitedStatesGovernment thatwent intoeffect in 2013 resulted in a 7.2% decrease of the BABs subsidies received by the Authority for therelatedbonds.BABssubsidyreceivedforthedebtservicepaymentsmadeonJuly1,2015wasreducedby7.3%andby6.8%forthepaymentsmadeonJanuary1,2016.Note3–UtilityPlantAtJune30,2016,UtilityPlant,netconsistedofthefollowing(amountsinthousands):



HooverUprating

TietonHydro‐power

LindenWindEnergy

UtilityplantProduction 734,333$ 259,977$ 287,203$ 252,468$ 292,124$ ‐$ 48,304$ 123,082$Transmission 17,718 ‐ 15,247 31,853 ‐ ‐ ‐ 23,432General 3,981 6,784 15,495 488 5,026 21 11 ‐Naturalgasreserves ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

756,032 266,761 317,945 284,809 297,150 21 48,315 146,514Lessaccumulateddepreciation 793,294 216,188 120,281 45,763 27,518 21 9,373 33,671

(37,262) 50,573 197,664 239,046 269,632 ‐ 38,942 112,843Constructionworkinprogress 28,290 2,617 2,033 ‐ ‐ ‐ ‐ ‐Nuclearfuel,atamortizedcost 43,927 ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netutilityplant 34,955$ 53,190$ 199,697$ 239,046$ 269,632$ ‐$ 38,942$ 112,843$

OTHERS


System Mead‐PhoenixMead‐Adelanto Pinedale Barnett SCPPAFund Total

UtilityplantProduction ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ 1,997,491$Transmission 770,498 81,659 206,330 ‐ ‐ ‐ 1,146,737General 44,400 3,105 509 4,093 ‐ 4,386 88,299Naturalgasreserves ‐ ‐ ‐ 73,175 84,868 ‐ 158,043

814,898 84,764 206,839 77,268 84,868 4,386 3,390,570Lessaccumulateddepreciation 598,639 29,685 91,570 36,285 38,546 460 2,041,294

216,259 55,079 115,269 40,983 46,322 3,926 1,349,276Constructionworkinprogress ‐ 555 ‐ 5 118 343 33,961Nuclearfuel,atamortizedcost ‐ ‐ ‐ ‐ ‐ ‐ 43,927

Netutilityplant 216,259$ 55,634$ 115,269$ 40,988$ 46,440$ 4,269$ 1,427,164$

June30,2016GENERATION GREENPOWER

TRANSMISSION NATURALGAS


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Note3–UtilityPlant(continued)InJune,2011,theAuthoritymadeaone‐timepaymenttoacquirean11,500sq.ft.buildinglocatedinthecityofGlendoratobeusedasSCPPAoffice facilities.Thebuildingwasrenovatedandput intoserviceduringfiscalyear2012.AcquisitionandconstructioncostswerefinancedbycontributionsfromSCPPAmembers.OnJuly18,2013,theSCPPABoardauthorizedtheinstallationofSolarVoltaicEquipmentandCarports at the SCPPA Glendora Office Building. The cost was financed by the SCPPA Members inaccordancewiththeirownershipinterestsintheSCPPABuilding.(SeeNote1).OnJanuary21,2016,theSCPPABoardofDirectorsapprovedResolutionNo.2016‐003authorizingthepurchaseandrenovationofthebuildingadjacenttotheofficebuildingthatSCPPAcurrentlyowns.Theacquisition will be allocated to each member based on the methodology that was used to fund thepurchaseofthecurrentSCPPAOfficeBuildingwhichwasacquiredinJune2011.AtJune30,2015,UtilityPlant,netconsistedofthefollowing(amountsinthousands):



HooverUprating

TietonHydro‐power

LindenWindEnergy

UtilityplantProduction 723,801$ 258,675$ 287,009$ 252,498$ 289,732$ ‐$ 47,899$ 123,082$Transmission 17,206 ‐ 15,247 31,853 ‐ ‐ ‐ 23,431General 3,666 6,811 15,495 488 4,956 21 11 ‐Naturalgasreserves ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

744,673 265,486 317,751 284,839 294,688 21 47,910 146,513Lessaccumulateddepreciation 758,019 204,836 109,327 36,215 15,166 21 8,158 27,857

(13,346) 60,650 208,424 248,624 279,522 ‐ 39,752 118,656Constructionworkinprogress 29,739 3,453 1,520 ‐ ‐ ‐ ‐ ‐Nuclearfuel,atamortizedcost 43,613 ‐ ‐ ‐ ‐ ‐ ‐ ‐

Netutilityplant 60,006$ 64,103$ 209,944$ 248,624$ 279,522$ ‐$ 39,752$ 118,656$

OTHERS


System Mead‐PhoenixMead‐Adelanto Pinedale Barnett SCPPAFund Total

UtilityplantProduction ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ 1,982,696$Transmission 770,498 55,106 173,139 ‐ ‐ ‐ 1,086,480General 44,400 2,730 473 4,094 ‐ 4,386 87,531Naturalgasreserves ‐ ‐ ‐ 73,191 84,416 ‐ 157,607

814,898 57,836 173,612 77,285 84,416 4,386 3,314,314Lessaccumulateddepreciation 575,885 28,004 86,871 32,643 34,158 347 1,917,507

239,013 29,832 86,741 44,642 50,258 4,039 1,396,807Constructionworkinprogress ‐ 174 ‐ (17) 452 221 35,542Nuclearfuel,atamortizedcost ‐ ‐ ‐ ‐ ‐ ‐ 43,613

Netutilityplant 239,013$ 30,006$ 86,741$ 44,625$ 50,710$ 4,260$ 1,475,962$

June30,2015

GENERATION GREENPOWER



74

Note3–UtilityPlant(continued)AsummaryofchangesinUtilityPlantfollows(amountsinthousands):

BalanceJuly1,2015 Additions Disposals Transfers

BalanceJune30,2016

NondepreciableutilityplantLand 49,272$ 6,830$ ‐$ ‐$ 56,102$Constructionworkinprogress 35,106 15,821 (231) (16,858) 33,838Constructionworkinprogress–gas 435 123 ‐ (435) 123Nuclearfuel* 43,614 14,714 (14,401) ‐ 43,927

Totalnondepreciableutilityplant 128,427 37,488 (14,632) (17,293) 133,990

DepreciableutilityplantProductionNucleargeneration(PaloVerdeProject) 722,887 (795) (3,874) 15,201 733,419Coal‐firedplant(SanJuanUnit3Project) 261,248 ‐ (152) 1,454 262,550Gas‐firedplant 826,662 2,398 (37) 194 829,217Greenpower 156,438 406 ‐ ‐ 156,844

Transmission 1,058,167 53,304 (137) ‐ 1,111,334General 79,193 1,082 (61) 9 80,223Naturalgasreserves 160,445 ‐ ‐ 435 160,880

Totaldepreciableutilityplant 3,265,040 56,395 (4,261) 17,293 3,334,467

Lessaccumulateddepreciation (1,917,505) (127,742) 3,954 ‐ (2,041,293)

Totalutilityplant,net 1,475,962$ (33,859)$ (14,939)$ ‐$ 1,427,164$

*Nuclearfueldisposalsrepresentamortization.Note4–InvestmentsTheAuthority’sinvestmentfunctionoperateswithinalegalframeworkestablishedbySections6509.5and53600et.seq.oftheCaliforniaGovernmentCode,IndenturesofTrust,andinstrumentsgoverningfinancialarrangementsenteredintobytheAuthoritytofinanceandoperateProjectsandtheAuthority’sInvestmentPolicy.Guaranteedinvestmentcontracts(GICs)arecontractsthatguaranteetheownerprincipalrepaymentandaspecified interest rate for a predetermined period of time. GICs are typically issued by insurancecompanies andmarketed to institutions that qualify for favorable tax status under federal laws. Thesetypes of securities provide institutionswith guaranteed returns. GICs are negotiated on a case‐by‐casebasis.


75

Note4–Investments(continued)BasedonSCPPA’s InvestmentPolicy, certainvehicles suchasGICs, flexible repurchaseagreementsorforward debt service agreements, may be entered into only upon approval of the SCPPA Board. Inaddition,eligiblesecuritiesandgeneral limitationsarederivedfromeachProject’s IndentureofTrust,theGovernmentCodeandSCPPA’sevolvinginvestmentpractices.TheoperativeIndenturesofTrustinwhichsecuritiesareauthorizedforinvestmentpurposesrelatetothePaloVerdeProjectBonds, theSouthernTransmissionSystemProjectBonds, theHooverUpratingProjectBonds,theMead‐PhoenixProjectBonds,theMead‐AdelantoProjectBonds,theSanJuanProjectBonds, the Magnolia Power Project Bonds, the Pinedale Projects Bonds, the Barnett Project Bonds,PrepaidNaturalGasProjectBonds,theCanyonPowerProjectBonds,theMilfordWindPhaseIProjectBonds, the MilfordWind Phase II Project Bonds, the LindenWind Project Bonds, the Tieton ProjectBonds,theWindyPoint/WindyFlatsBonds,andtheApexPowerProjectBonds.Authorizedinvestmentsfor theProjects’ StabilizationFund are set forth in a resolution approvedby theBoard in 1996. (SeeNote13).Eligiblesecuritiesinclude: UnitedStatesTreasurySecurities,whicharebondsorotherobligationssecuredbythefullfaithand

creditoftheUnitedStatesofAmerica; FederalAgencyObligations,whichhavethefullfinancialbackingoftheU.S.Government; Government Sponsored Enterprise Obligations, which are created by acts of Congress to provide

liquidityforselectedlendingprogramstargetedbyCongress; RepurchaseAgreements,whicharecollateralizedloancontractswherethesellerincludesawritten

agreementtorepurchasethesecuritiesatalaterdateforaspecifiedamount; Negotiable Certificates of Deposit, which are deposit liabilities issued by a nationally or state‐

charteredbank,a savingsora federalassociationorbyastate‐licensedbranchofa foreignbank,whichhasshort‐termratingsofatleast“A‐1”byS&Pandatleast“P‐1”byMoody’s;

Bankers'Acceptances,ashort‐termdraftorbillofexchangeguaranteedforpaymentatfacevaluetotheholderoftheinstrumentonitsmaturitydate,whichhasashort‐termratingofatleast“A‐1”byS&Pandatleast“P‐1”byMoody’s;

Commercial Paper, a short‐term unsecured promissory note issued by non‐financial or financialfirmswitharatingofatleast“A‐1”byS&Pandatleast“P‐1”byMoody’s;

Medium Term Notes rated “A” or better and only those issued by corporations organized andoperatingwithintheUnitedStates,orbydepositoryinstitutionslicensedbytheUnitedStatesoranystateandoperatingwithintheUnitedStates;and

Equity‐LinkedNotes,whicharecategorizedasmedium‐termcorporatenotesandaresubjecttotheconstraintssetforthintheGovernmentCodeandtheAuthority’sInvestmentPolicy.


76

Note4–Investments(continued)AsofJune30,2016,theAuthorityheldthefollowingascashandcashequivalentsandinvestments:

FairValue WeightedAverage(inthousands) Maturity(Years) PercentofPortfolio

U.S.AgencySecurities 373,988$ 0.65 37.3%GuaranteedInvestmentContracts 26,972 11.21 2.7%MoneyMarketFunds 237,739 0.08 23.7%CommercialPaper 58,442 0.24 5.8%NegotiableCDs 25,910 0 2.6%AgencyDiscountNotes 277,147 0.10 27.6%BankersAcceptance 2,565 0.42 0.3%

Total 1,002,763$ 0.61 100.0%

InvestmentType

The“weightedaveragematurityinyears”calculationassumesthatallinvestmentsarehelduntilmaturity.


77

Note4–Investments(continued)InvestmentsatJune30,2016areasfollows(amountsinthousands):


HooverUprating

TietonHydro‐power MilfordIWind MilfordIIWind WindyPoint

LindenWindEnergy


System Mead‐PhoenixMead‐Adelanto

U.S.Agencies 173,919$ 9,141$ 45,852$ 19,729$ 6,089$ 1,701$ 4,997$ 16,613$ 3,227$ 10,293$ 2,324$ 7,672$ ‐$ 2,000$

AgencyDiscountNotes 26,599 25,008 10,200 14,099 18,593 1,199 1,070 9,000 10,893 22,697 5,925 41,409 3,300 17,800

NegotiableCDs ‐ 5,006 ‐ ‐ 4,003 ‐ ‐ ‐ ‐ ‐ ‐ 7,400 ‐ ‐

CommercialPaper ‐ 7,469 2,350 ‐ 8,795 ‐ ‐ 3,400 ‐ ‐ ‐ 16,995 ‐ 2,497

GICs 7,444 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 7,789 ‐ ‐

BankersAcceptance ‐ ‐ ‐ ‐ 2,004 561 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

MoneyMarketFunds 36,306 3,797 30,402 8,668 9,494 1,094 2,064 14,721 4,088 14,559 3,738 13,165 3,815 6,746

Total 244,268$ 50,421$ 88,804$ 42,496$ 48,978$ 4,555$ 8,131$ 43,734$ 18,208$ 47,549$ 11,987$ 94,430$ 7,115$ 29,043$

Restrictedinvestments 196,774$ 26,797$ 52,802$ 31,128$ 38,184$ 3,461$ 4,997$ 25,813$ 8,227$ 23,592$ 5,999$ 41,155$ 2,300$ 17,497$

Unrestrictedinvestments 25,657 20,870 ‐ ‐ ‐ ‐ ‐ ‐ 3,793 2,498 ‐ ‐ ‐ ‐

Cashandcashequivalents 21,837 2,754 36,002 11,368 10,794 1,094 3,134 17,921 6,188 21,459 5,988 53,275 4,815 11,546

Total 244,268$ 50,421$ 88,804$ 42,496$ 48,978$ 4,555$ 8,131$ 43,734$ 18,208$ 47,549$ 11,987$ 94,430$ 7,115$ 29,043$

OrmatGeo‐thermal

MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas


CopperMountainSolar

3Columia2Solar

Heber‐1Geothermal KingbirdSolar

DonA.Campbell2Geothermal Pinedale Barnett

PrepaidNaturalGas

ProjectDevelopment

Fund


Fund SCPPAFund Total

U.S.Agencies ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ 16,215$ ‐$ ‐$ 54,216$ ‐$ 373,988$

AgencyDiscountNotes ‐ ‐ 3,000 ‐ ‐ 13,987 ‐ ‐ ‐ 1,000 1,100 11,499 1,000 ‐ 37,769 ‐ 277,147

NegotiableCDs ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 1,500 ‐ ‐ ‐ 8,001 ‐ 25,910

CommercialPaper ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 4,194 ‐ ‐ 12,742 ‐ 58,442

GICs ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 11,739 ‐ ‐ ‐ 26,972

BankersAcceptance ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 2,565

MoneyMarketFunds 601 1,735 821 615 123 9,754 1,014 5,615 732 297 8,533 11,271 3,798 2,797 34,835 2,541 237,739

Total 601$ 1,735$ 3,821$ 615$ 123$ 23,741$ 1,014$ 5,615$ 732$ 1,297$ 11,133$ 43,179$ 16,537$ 2,797$ 147,563$ 2,541$ 1,002,763$

Restrictedinvestments ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ 1,100$ 31,908$ 11,739$ ‐$ 112,728$ ‐$ 636,201$

Unrestrictedinvestments ‐ ‐ ‐ ‐ ‐ 8,988 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 61,806

Cashandcashequivalents 601 1,735 3,821 615 123 14,753 1,014 5,615 732 1,297 10,033 11,271 4,798 2,797 34,835 2,541 304,756

Total 601$ 1,735$ 3,821$ 615$ 123$ 23,741$ 1,014$ 5,615$ 732$ 1,297$ 11,133$ 43,179$ 16,537$ 2,797$ 147,563$ 2,541$ 1,002,763$

GENERATION GREENPOWER TRANSMISSION

NATURALGAS MISCELLANEOUSPOWERPURCHASEAGREEMENTS


78

Note4–Investments(continued)InvestmentsatJune30,2015areasfollows(amountsinthousands):


HooverUprating

TietonHydro‐power MilfordIWind MilfordIIWind WindyPoint LindenWind



U.S.Agencies 177,426$ 7,422$ 39,719$ 19,519$ 13,487$ 1,697$ 4,956$ 26,769$ 6,072$ 13,296$ 3,804$ 9,615$ ‐$ ‐$AgencyDiscountNotes 20,738 6,097 10,499 ‐ 10,000 ‐ ‐ 2,000 ‐ 2,000 ‐ 5,000 ‐ ‐NegotiableCDs ‐ ‐ 1,700 ‐ ‐ ‐ ‐ 1,600 2,400 5,700 ‐ 4,000 1,300 3,300CommercialPaper 5,000 ‐ 6,994 3,199 24,494 1,999 ‐ ‐ ‐ 5,000 ‐ 22,500 2,900 12,397GICs 14,513 ‐ 3,863 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 7,789 ‐ ‐BankersAcceptance ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐MoneyMarketFunds 29,069 19,444 26,839 11,949 24,107 881 3,133 12,199 9,202 23,505 8,211 45,449 3,377 12,860

Total 246,746$ 32,963$ 89,614$ 34,667$ 72,088$ 4,577$ 8,089$ 42,568$ 17,674$ 49,501$ 12,015$ 94,353$ 7,577$ 28,557$

Restrictedinvestments 189,229$ 11,975$ 52,576$ 22,718$ 37,981$ 3,136$ 4,956$ 26,267$ 3,249$ 21,293$ 2,303$ 48,904$ 2,900$ 14,397$Unrestrictedinvestments 23,742 ‐ ‐ ‐ ‐ 560 ‐ 2,502 2,823 3,003 1,501 ‐ ‐ ‐Cashandcashequivalents 33,775 20,988 37,038 11,949 34,107 881 3,133 13,799 11,602 25,205 8,211 45,449 4,677 14,160

Total 246,746$ 32,963$ 89,614$ 34,667$ 72,088$ 4,577$ 8,089$ 42,568$ 17,674$ 49,501$ 12,015$ 94,353$ 7,577$ 28,557$

OrmatGeo‐thermal

MWDSmallHydro

PebbleSpringsWind

AmerescoChiquita

LandfillGas

DonA.Campbell/Wild

RoseGeothermal

CopperMountainSolar

3Columbia2

Solar Pinedale BarnettPrepaid

NaturalGas

ProjectDevelopment

Fund


Fund SCPPAFund Total

U.S.Agencies ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ 21,689$ ‐$ ‐$ 106,272$ ‐$ 451,743$AgencyDiscountNotes ‐ ‐ 1,000 ‐ ‐ ‐ ‐ 1,000 ‐ ‐ ‐ 20,591 ‐ 78,925NegotiableCDs ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 1,500 ‐ ‐ ‐ ‐ 21,500CommercialPaper ‐ ‐ ‐ ‐ ‐ 9,994 ‐ ‐ 7,998 19,490 ‐ 121,965GICs ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 11,586 ‐ ‐ ‐ 37,751BankersAcceptance ‐ ‐ ‐ ‐ ‐ 3,800 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 3,800MoneyMarketFunds 1,817 1,339 2,761 1,418 3,369 13,182 1,885 8,303 12,381 4,476 6,485 10,019 165 297,825

Total 1,817$ 1,339$ 3,761$ 1,418$ 3,369$ 26,976$ 1,885$ 9,303$ 43,568$ 16,062$ 6,485$ 156,372$ 165$ 1,013,509$

Restrictedinvestments ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ ‐$ 31,187$ 11,586$ ‐$ 146,353$ ‐$ 631,010$Unrestrictedinvestments ‐ ‐ 1,000 ‐ ‐ 9,994 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 45,125Cashandcashequivalents 1,817 1,339 2,761 1,418 3,369 16,982 1,885 9,303 12,381 4,476 6,485 10,019 165 337,374

Total 1,817$ 1,339$ 3,761$ 1,418$ 3,369$ 26,976$ 1,885$ 9,303$ 43,568$ 16,062$ 6,485$ 156,372$ 165$ 1,013,509$

GENERATION GREENPOWER TRANSMISSION

NATURALGAS MISCELLANEOUSPOWERPURCHASEAGREEMENTS


79

Note4–Investments(continued)Interest rate risk – The Authority’s investment policy limits the maturity of its investments to amaximumoffiveyearsforinvestmentsintheUnitedStatesTreasury,FederalAgency,andGovernmentSponsoredEnterprisesecurities,excluding:investmentsheldinProjectDebtServiceReserve;long‐termcommitmentsoragreementsapprovedbytheAuthority’sBoard;fiveyearsformediumtermcorporatenotes;270daysforcommercialpaper;180daysforbankers'acceptances;andoneyearfornegotiablecertificatesofdeposits.Creditrisk–UnderitsinvestmentpolicyandtheStateofCaliforniaGovernmentCode,theAuthorityissubject to the prudent investor standard of care in managing all aspects of its portfolios. As aninvestmentstandard,eachinvestmentshallbemadewith“judgmentandcareundercircumstancesthenprevailing,whichapersonofprudence,discretionandintelligencewouldexerciseinthemanagementofhis/her affairs, not in regard for speculation, but in regard to the permanent disposition of funds,considering the probable income as well as the probable safety of the capital to be invested.” TheAuthority’sinvestmentpolicydoesnotprecludeactivemanagementoftheportfoliotoaddressmarketopportunities. All transactions shall be undertaken in the best interest of the Authority and itsparticipants.TheAuthority’sinvestmentpolicyspecifiesthatallprojectfundsmaybeinvestedinsharesofbeneficialinterest for temporary periods, pending disbursement or reinvestment as allowed under the state ofCaliforniaGovernmentCode(Code).TheCoderequiresthat the fundmusthaveeither1)attainedthehighest ranking or highest letter and numerical rating provided by not less than two nationallyrecognizedstatisticalratingorganizations(NRSRO)or2)retainedaninvestmentadvisorregisteredorexempt fromregistrationwith theSecuritiesandExchangeCommissionwithnot less than fiveyears’experiencemanagingmoneymarketmutual fundswith assets undermanagement in excess of $500million.AsofJune30,2016,moneymarketfundsintheportfolioswithBankofNewYorkMellonhaveattainedthefollowingratings:AAAmbyStandardandPoor’s,andAaa‐mfbyMoody’sInvestorsService;whilebankdepositsintheportfolioswithUSBankhaveattainedratingsofA‐1+byStandardandPoor’s,P‐1byMoody’sInvestorsService,andF1+byFitchRatings.The U.S. government agency securities in the portfolio consist of securities issued by government‐sponsoredenterprises,whicharenotexplicitlyguaranteedbytheU.S.government.AsofJune30,2016and 2015, the U.S. government agency securities in the portfolio carried the highest possible creditratingsbytheNRSROthatratedthem.TheGuaranteedInvestmentContractsintheportfoliowithAmericanInternationalGroup(AIG)consistofsecurities issuedbycorporationsandcarryaratingofA‐byStandardandPoor’s,Baa1byMoody’sInvestorsServiceandBBB+byFitchRating.


80

Note4–Investments(continued)The Investment Agreement Contract with American General Life consists of securities issued bycorporationsandcarriesaratingofA+byStandardandPoor’s,A2byMoody’sandA+byFitchRatings.TheInvestmentAgreementContractintheportfoliowithAssuredGuaranty(formerlyFinancialSecurityAssurance) consists of securities issued by corporations and carries a rating of AA by Standard andPoor’s,andA3byMoody’sInvestorsService.Concentrationofcreditrisk–TheAuthority’sinvestmentpolicyspecifiesa50%to100%limitationontheamountthatcanbeinvestedinU.S.governmentagencysecurities,exceptincertainissuesofotherAuthorityprojects,suchastheMead‐AdelantoandMead‐Phoenixprojects.OftheAuthority’stotalinvestmentsasofJune30,2016,$197million(20%)wasinvestedinsecuritiesissuedby theFederalHomeLoanBank; $93million (9%)was investedwithFarmCreditBank; $196million (19%)was invested in securities issued by the Federal National Mortgage Association; $165million (16%)was investedwithFederalHomeLoanMortgage;$3million (0.3%)was invested inUSTreasuries;$26million(3%)wasinvestedinCertificatesofDeposit;$58million(6%)wasinvestedinCommercialPaper;and$27million(3%)wasinvestedinGICs.OftheAuthority’stotalinvestmentsasofJune30,2015,$180million(18%)wasinvestedinsecuritiesissuedby theFederalHomeLoanBank; $44million (4%)was investedwithFarmCreditBank; $212million (21%) was invested in securities issued by the Federal National Mortgage Association; $94million (9%) was invested with Federal Home Loan Mortgage; $22 million (2%) was invested inCertificatesofDeposit; $122million (12%)was invested inCommercial Paper; and$15million (1%)wasinvestedinGICswithAssuredGuaranty.Note5–DerivativeInstrumentsObjectiveoftheswaps–SCPPAusesderivativeinstrumentstohedgeitsexposuretochanginginterestratesthroughtheuseofinterestrateswapsandalsotomanageitsexposuretofluctuatingnaturalgaspricesthroughtheuseofnaturalgashedgecontracts.AninterestrateswapistheexchangeofpaymentsbetweenSCPPAandacounterpartyinordertopotentiallyobtainalowercostoffundingthantraditionalfixedratebonds,ortohedgeinterestrateexposureonSCPPA’sassetsor liabilities.TheAuthorityhasentered into separatepay‐fixed, receive‐variable interest rate swapsand fourbasis swaps toproducesavingsortoresultinlowercostsoverthelifeofeachtransactionthanwhattheAuthoritywouldhavepaid using fixed‐rate debt. While these instruments carry additional risks, SCPPA’s swap policy andfavorablenegotiationshavehelpedtoreducesuchrisks.


81

Note5–DerivativeInstruments(continued)The Authority has adopted Statement No. 53 of the GASB, Accounting and Financial Reporting forDerivative Instruments (GASB 53). This Statement addresses the recognition, measurement, anddisclosure of information regarding derivative instruments. In accordance with GASB 53, SCPPArecognizes the changes in fair values of effective hedging derivative instruments as either deferredinflowsoroutflowsofresourcesontheAuthority’sStatementsofNetPositionandincludeschangesinthefairvalueofanineffectivederivativeinstrumentinearnings.For fiscal year ended June 30, 2016, the balance for the swaps deemed to qualify for effective hedgeaccountingunderGASB53wasanetliabilityandcorrespondingdeferredoutflowsofresourcesof$37.9million.Anincreaseof$14.8millionfromtheliabilitybalanceof$23.1millionatJune30,2015.For theswaps thatweredeemed ineffectivederivative instrumentsunderGASB53, thechangeswerereported in the statement of operations. The net liability balance for the ineffective derivativeinstrumentsatJune30,2016was$21.6millionanincreaseof$10.2millionfromtheliabilitybalanceof$11.4millionatJune30,2015.For fiscal year ended June 30, 2015, the balance for the swaps deemed to qualify for effective hedgeaccountingunderGASB53wasanetliabilityandcorrespondingdeferredoutflowsofresourcesof$23.1million.Thenetliabilitybalancefortheineffectivederivativeinstrumentswas$11.4million.Terms, fairvalues, and credit risk –The terms, including the fair values and credit ratings of thecounterpartiesundertheoutstandingswapsasofJune30,2016,areincludedinthetablebelow.Inmostcases, andwith the exclusionof basis swaps, thenotional amountof any swapmatches theprincipalamountof theassociateddebt.Exceptasdiscussedunder therolloverrisk,andwhenassociatedwithbasis swaps, the Authority’s swap agreements contain scheduled reductions to outstanding notionalamounts that are expected to approximately follow scheduled or anticipated reductions in theassociated“bondspayable”category.

NotionalAmount(inthousands)

EffectiveDate FixedRatePaid VariableRateReceived

FairValues(inthousands)

SwapTermination

DateCounterpartyCreditRating*

MAG2010‐1Swap(Barclays) 100,000$ 5/11/2010 SIFMA 80.4%of3‐monthLIBOR (302)$ 7/1/2036 A‐/A2/A

MAG2010‐2Swap(RBC) 100,000 5/12/2010 SIFMA 81%of3‐monthLIBOR (178) 7/1/2036 AA‐/Aa3/AA

MAG2009‐1Swap(BNYMellon) 109,704 5/1/2012 3.125% SIFMA (24,797) 7/1/2036 AA‐/Aa2/AA

MAG2009‐2Swap(JPMorgan) 109,595 8/21/2012 3.139% SIFMA (24,963) 7/1/2036 A+/Aa3/AA‐

MA2007Swap 100,000 6/1/2018 1‐monthLIBOR 100%of10‐yrLIBORCMSrateless.414% 3,731 9/15/2030 A+/Aa3/AA‐

PNG2007Swap 36,000 5/1/2009 5.0475% 67%of3‐MonthLIBORplus1.47% (13,172) 11/1/2035 BBB+/A3/A

555,299$ (59,681)$

*S&P/Moody's/Fitchratings


82

Note5–DerivativeInstruments(continued) MAG2010‐1Swap–InMay2010,SCPPAexecuted$100millionSecuritiesIndustryandFinancial

MarketsAssociationSwapIndex(SIFMA)/LIBORfloating‐to‐floatingbasisswaprelatedtoMagnoliaPower Project A Refunding Bonds 2009‐1. SCPPA pays the 6‐month average of theweekly resetSIFMAMunicipal Swap Index semi‐annually on an Actual/Actual basis in exchange for receiving80.4% of average 3‐Month LIBOR, reset quarterly and paid semi‐annually on an Actual/360 daybasis.TheswapexpiresonJuly1,2036.

MAG2010‐2Swap–InMay2010,SCPPAexecuted$100millionSIFMA/LIBORfloating‐to‐floatingbasisswaprelatedtoMagnoliaPowerProjectARefundingBonds2009‐2.SCPPApaysthe6‐monthaverageoftheweeklyresetSIFMAMunicipalSwapIndexsemi‐annuallyonanActual/Actualbasisinexchangeforreceiving81.0%ofaverage3‐MonthLIBOR,resetquarterlyandpaidsemi‐annuallyonanActual/360daybasis.TheswapexpiresonJuly1,2036.

MAG2009‐1Swap (restated/novated) –This swap transaction amends theMAG2007‐1 Swap,

whichhadanoriginaltradedateofApril30,2007.ThetransactionwasamendedandrestatedasofApril21,2009.TheAuthoritypaysitscounterpartyafixedrateof3.125%inexchangeforreceiving100% of the SIFMA on a notional amount of $110.0million. In order to providemore favorableterms to theparticipants, SCPPAmadeapaymentof $15.7million to the counterpartywhichhasbeendeferredandisbeingamortizedasaninterestyieldadjustmentoverthelifeoftheswap.Theamendmentallowedthepartiestore‐coupontheswaps,changethecollateralpostingrequirements,andtomovetouninsuredswaps.InMay2012,theswapwasnovatedtoanewcounterpartyandtheswapdocumentswereamendedtoraisethecollateralthreshold.

MAG2009‐2Swap(amended/restated)–ThisswaptransactionamendstheMAG2007‐1Swap.

TheoriginaltransactionwasnovatedfromBearStearnstoJPMorganonNovember6,2008andwasamendedandrestatedonApril21,2009.TheAuthoritypaysitscounterpartyafixedrateof3.139%inexchangeforreceiving100%oftheSIFMAIndexonanotionalamountof$109.9million.Inordertoprovidemorefavorabletermstotheparticipants,SCPPAmadeapaymentof$15.7milliontothecounterpartywhichhasbeendeferredandisbeingamortizedasaninterestyieldadjustmentoverthe life of the swap. The amendment allowed the parties to re‐coupon the swaps, change thecollateral posting requirements, and to move to uninsured swaps. In August 2012, the swapdocumentswereamendedtoraisethecollateralthreshold.

STSSwap/Swaption(terminated)–InMarch2015,theSTS2000SeriesABondswererefunded

andtheSTSSwap/Swaptionwasterminated.


83

Note5–DerivativeInstruments(continued) MA2007Swap(amended)–InJanuary2007,theAuthorityenteredintoaConstantMaturitySwap

(CMS)inconnectionwithitsoutstandingMead‐AdelantoProjectbonds.Thetransactionconsistedofa$100millionbasisswapanddoesnotrelatetoanysingleseriesoftheMead‐Adelantobonds.Theamended swap terms became effective on February 1, 2008 and the Authority pays the swapcounterparty100%oftheonemonthLIBORinexchangeforreceiving100%ofthe10‐yearLIBORminus41.4basispoints.TheswapexpiresonSeptember15,2030.OnNovember5,2008 theMA2007SwapwasnovatedfromBearStearnstoJPMorgan.Inaddition,theswapwassuspendeduntilNovember1,2011.Aspartofthenovation,thecredittermsoftheexistingswapagreementsweremaintainedandSCPPAreceived$4.1millionfromJPMorganascompensationforthesuspensionofthe cash flows of the MA 2007 CMS. The $4.1 million was deferred to be amortized over thesuspensionterm.In June 2010, theMA 2007 CMSAgreementwas amended to extend the suspension period fromNovember1,2011toJune1,2018.SCPPAreceived$5millionascompensationforthesuspensionofthecash flowsof theswap,whichwasdeferredand isbeingamortizedoverthesuspensionterm.Thecredittermsoftheexistingswapagreementsremainsunchanged.

PNG 2007 Swap – In October 2007, SCPPA entered into an interest rate swap agreement in

connectionwiththeissuanceofthePrepaidNaturalGasProjectNo.1Series2007BBonds.Theswaphedges the interest‐rate riskon theLIBORFloating‐ratebonds,whereSCPPApaysa fixed rateof5.0475%inexchangeforreceiving67%ofthree‐monthLIBORplus1.47%.ThefloatingindexontheswapexactlymatchesthecouponontheBondsandthereforeprovidesahedgewithnotaxorbasisrisk.TheswapexpiresonNovember1,2035.

PNG2007CommoditySwap – At the same time, SCPPA also entered into five commodity price

swapagreements,onbehalfofeachofthePrepaidNaturalGasProjectNo.1Participants,inordertohedgeagainstreductionsto itsgassalerevenuesresulting fromchanges inmonthlymarket indexprices. SCPPApaysa floatingnatural gaspriceovera30‐yearperiodand receives specified fixednatural gas prices at an agreed pricing point as determined in the Prepaid Natural Gas No. 1Agreements.TheswapsbecameeffectiveonJuly1,2008andwillallexpireonSeptember30,2035.

Fairvalue–TheAuthorityreportsitsderivativeinstrumentsinaccordancewithGASB53andrecordsitsfairvaluesinaccordancewithGASB72(SeeNote6).WhilesomeofSCPPA’scurrentmarktomarketvaluesarenegative,thisvaluationwouldberealizedonlyiftheswapswereterminatedatthevaluationdate,andonlySCPPAretainstherighttooptionallyterminatemostofthetransactions.


84

Note5–DerivativeInstruments(continued)Interest‐raterisk–InterestrateriskistheriskthatchangesininterestrateswilladverselyaffectthefairvaluesofSCPPA’s financial instrumentsorcash flows.SCPPAisexposedto interest‐rateriskon itspay‐fixed,receivevariableinterestrateswaps.AstheLIBORortheSIFMAswapindexdecreases,SCPPA’snetpaymentonswapsincreases.Inaddition,SCPPAisexposedtointerestrateriskifthecounterpartytotheswapdefaultsoriftheswapisterminated.Marketaccessrisk–MarketaccessriskistheriskthatSCPPAwillnotbeabletoentercreditmarketsorthatcreditwillbecomemorecostly.SCPPA’sfinancialratingistiedtothecreditstrengthofthemajorparticipantsofthespecificprojectforwhicheachfinancialinstrumentisissued.SCPPAisalsoexposedtomarketaccessriskscausedbydisruptionsinthemunicipalbondmarket.Credit risk –As of June 30, 2016, the net fair values of the Authority’s applicable swaps for whichpayments were made were negative for each counterparty except for the MA 2007 swap. However,should interest rates change and the fair values of the swaps becomepositive, theAuthoritymay beexposedtocreditriskintheamountofthederivatives’fairvalue.Theswapagreementscontainvaryingcollateralagreementswiththecounterparties.Theswapsrequirefull collateralization of the fair value of the swap should the counterparty’s (or if applicable, theguarantorsofthecounterparty’s)creditratingfallbelowAA‐asissuedbyStandard&Poor’sorAa3asissuedbyMoody’sInvestorsServicefortheMA2007Swaps;A/A2forthePNG2007CommoditySwap;andA‐/A3fortheMAG2010‐1,MAG2010‐2,MAG2009‐1,andMAG2009‐2.CollateralonallswapsistobeintheformofU.S.governmentsecuritiesheldbyathird‐partycustodian.TheswapagreementsprovidethatwhentheAuthorityhasmorethanonederivativetransactionwithagiven counterparty involving the same Authority project (and having the same swap/bond insurer),shouldonepartybecomeinsolventorotherwisedefaultonitsobligations,close‐outnettingprovisionspermit thenon‐defaultingparty to accelerate and terminate all such related transactions andnet thetransactions’fairvaluessothatasinglesumwillbeowedby,orowedto,thenon‐defaultingparty.Basisrisk–BasisriskistheriskthattheinterestratepaidbytheAuthorityonunderlyingvariableratebonds tobondholdersexceeds thevariableswaprate received fromthecounterparty, and the risk thatbothlegsofabasisswaparenotexactlyequal.WiththeexceptionofthePNG2007Swap,theAuthoritybearsbasisriskoneachofitsswaps.ThePNG2007SwapisperfectlyhedgedsincethecounterpartypaystheAuthorityitsactualvariablebondrateontherelatedbonds.


85

Note5–DerivativeInstruments(continued)AlltheotherswapshaveabasisrisksinceundereachofthoseswapstheAuthorityreceivedapercentageofLIBORorapercentageof,orspreadto,SIFMAtooffsettheactualvariablebondrateorvariableswapratetheAuthoritypaysonanyrelatedbondsoronanybasisswap.TheAuthorityisexposedtobasisriskshouldthefloatingratethatitreceivesonaswapbelessthantheactualvariableratetheAuthoritypayson any related bonds; or in the case of the floating‐to‐floating fixed‐spread basis swap, less than thevariableratepaidtotheswapcounterparty.Dependingonthemagnitudeanddurationofanybasisriskshortfall,theexpectedcostsavingsfromaswapmaynotbefullyrealized.ThefollowingisasummaryofinterestratespaidtoandreceivedfromthecounterpartiesasofJune30,2016:

MAG2009‐1Swap

MAG2009‐2Swap

MAG2010‐1Swap

MAG2010‐2Swap

PNG2007Swap

Paymentstocounterparty 3.125% 3.139% 0.405% 0.405% 5.048%Less,variablepaymentsfromcounterparty 0.405% 0.405% 0.503% 0.506% 1.897%

Netinterest‐rateswappayments 2.720% 2.734% ‐0.098% ‐0.101% 3.151%

Add,variable‐ratebondcouponpayments 0.400% 0.390% N/A N/A 1.897%

Syntheticinterestrateonbonds 3.120% 3.124% ‐0.098% ‐0.101% 5.048%

Termination risk –The Authority or the counterpartymay terminate any of the swaps if the otherparty fails to perform under the terms of the contract. If any of the swaps were terminated, anyassociatedvariableratebondswouldnolongerbehedgedtoafixedrate.Ifatthetimeofterminationtheswaphasanegativefairvalue,theAuthoritywouldbeliabletothecounterpartyforapaymentequaltotheswap’sfairvalue.Rollover risk –Rollover risk is the risk that the swap contract is not co‐terminus with the relatedbonds. In the event that this type of swap terminates, the Authority would be exposed to variableinterestratesontheunderlyingbonds.


86

Note5–DerivativeInstruments(continued)Swappaymentsandassociateddebt–UsingratesasofJune30,2016,debtservicerequirementsofthe Authority’s outstanding variable rate debt and net swap payments are as follows. As rates vary,variableratebondinterestpaymentsandnetswappaymentswillvary.

Interest‐RatePrincipal Interest Swaps,Net Total

750$ 1,000$ 6,692$ 7,692$785 997 6,671 7,668815 994 6,649 7,643850 991 6,626 7,617885 987 6,602 7,589

36,180 4,634 30,932 35,566167,120 3,444 23,081 26,525217,945 2,285 13,716 16,00164,220 ‐ ‐ ‐

489,550$ 15,332$ 100,969$ 116,301$

2037–20392032–2036

2021

20192020

2022–20262027–2031

FiscalYearEndingJune30,

(amountsinthousands)Variable‐RateBonds

20172018

Thefollowingtableshowsthechangesinfairvalueofderivativeinstruments(amountsinthousands):

June30,2015ChangeinFair

Value June30,2016

AssetsMeadAdelanto–Derivativeinstruments 2,229$ 1,502$ 3,731$

2,229$ 1,502$ 3,731$

DeferredoutflowsofresourcesMagnolia–Deferredoutflows 13,272$ 11,525$ 24,797$PrepaidNaturalGas–Deferredoutflows 9,882 3,290 13,172

23,154$ 14,815$ 37,969$

LiabilitiesMagnolia–Derivativeinstruments 26,975$ 23,266$ 50,241$PrepaidNaturalGas–Derivativeinstruments 9,882 3,290 13,172

36,857$ 26,556$ 63,413$

Description


87

Note6–FairValueMeasurementInFebruary2015,theGASBissuedStatementNo.72,FairValueMeasurementandApplication,effectiveforfinancialstatementsforyearsbeginningafterJune15,2015.Thisstatementclarifiesthedefinitionoffair value, establishes general principles for measuring fair value, provides additional fair valueapplication guidance, and enhances disclosures about fair value measurements. This statementestablishesathree‐levelhierarchytothevaluationtechniquesusedtomeasurefairvalue.Disclosureisrequired to bemade about fair valuemeasurements, the level of fair value hierarchy, and valuationtechniques.InaccordancewithGASB72,FairValue is theprice thatwouldbereceived tosellanassetorpaid totransferaliabilityinanorderlytransactionbetweenmarketparticipantsatthemeasurementdate(anexit price). Fair Value is a market‐based measurement for a particular asset or liability based onassumptions that market participants would use in pricing the asset or liability. Such assumptionsincludeobservableandunobservableinputsofmarketdata,aswellasassumptionsaboutriskandtheriskinherentintheinputstothevaluationtechnique.Valuation inputs are assumptions that market participants use in pricing an asset or liability. ThehierarchyofinputsusedtogeneratethevaluationisclassifiedintothreedifferentLevels:

Level1inputsarequotedprices(unadjusted)inactivemarketsforidenticalassetsorliabilitiesthatthegovernmentcanaccessatthemeasurementdate.

Level2 inputs includequotedprices for similar assets or liabilities inmarkets that are active;quotedpricesforidenticalorsimilarassetsorliabilitiesinmarketsthatarenotactive;andinputsotherthanquotedpricesthatareobservableforanasset,eitherdirectlyorindirectly.

Level3inputsareunobservableinputsfromtheassetorliabilitywherethereisverylittlemarketactivityandtheyshouldbeusedonlywhenrelevantLevel1andLevel2inputsareunavailable.

TheAuthority’sfairvaluemeasurementsareperformedonarecurringbasis.Becauseinvestingisnotacore part of the Authority’s mission, the Authority determines that the disclosures related to theseinvestments only need to be disaggregated by major type. The Authority categorizes its fair valuemeasurementswithinthefairvaluehierarchyestablishedbygenerallyacceptedaccountingprinciples.ThefairvalueofSCPPA’sswapsreflectthenonperformanceriskoftheirclientcounterpartyrelatingtothatliability,andthenonperformanceriskofthebankcounterpartyrelatingtothatasset.Thetablesonpages89and90presentsfairvaluebalancesandtheirlevelswithinthefairvaluehierarchyasofJune30,2016and2015.TheinvestmentbalancespresentedexcludeamountsrelatedtoGovernmentMoneyMarketFundsandGuaranteedInvestmentContracts.


88

Note6–FairValueMeasurement(continued)FairValueofSCPPA’sInvestmentsunderGASB72–DebtandothersecuritiesclassifiedinLevel1ofthefair value hierarchy are valued through the evaluation of information obtained from live data sources,includingactivemarketmakersandinter‐dealerbrokersandtheuseofpricesquotedinactivemarketsforthose securities. Level 2 Securities are valued using amulti‐dimensional relationshipmodel ormatrixpricingmodelutilizingmarketdataincluding,butnotlimitedto,benchmarkyields,reportedtrades,andbroker/dealerquotes.FairValueofSCPPA’sSwapsunderGASB72–Fairvaluestakeintoconsiderationtheprevailinginterestrateenvironmentand thespecific termsandconditionsofagiven transaction.Theexpectedswapcashflows are calculated using the zero‐coupon discounting method which takes into consideration theprevailinginterestrateenvironment,thespecifictermsandconditionsofagiventransaction,andassumesthat the current forward rates impliedby the yield curve are themarket’s best estimateof future spotinterest rates. The income approach is then used to obtain the fair value of the swaps, where futureamounts(theexpectedswapcashflows)areconvertedtoasinglecurrent(discounted)amount,usingarateofreturnthattakesintoaccounttherelativeriskofnonperformanceassociatedwiththecashflows,and time value of money. Where applicable under the income approach, the option pricing modeltechnique,suchastheBlack‐Derman‐Toymodel,orotherappropriateoptionpricingmodel isused.TheobservabilityofinputsusedtoperformthemeasurementresultsintheswapfairvaluesbeingcategorizedasLevel2.The time and technical resources expended by the independent provider focused on computing theJune30, 2016 Fair Values pursuant to GASB 72 for the first time was considerable. The providerdetermined that it would be unable to provide the Fair Values for June 30, 2015 with their limitedresources.ThereforetheFairValuesforfiscalyear2015willnotberestated.


89

Note6–FairValueMeasurement(continued)TheAuthorityhasthefollowingfairvaluemeasurementsatJune30,2016:

Quotedpricesinactive Significantmarkets other Significant

foridentical observable unobservableJune30, assets inputs inputs2016 (Level1) (Level2) (Level3)

InvestmentsbyfairvaluelevelDebtsecurities

U.S.governmentsecurities 2,565$ 2,565$ ‐$ ‐$U.S.agencies 651,136 ‐ 651,136 ‐

Totaldebtsecurities 653,701 2,565 651,136 ‐

OtherCommercialPaper 58,442 ‐ 58,442 ‐Certificateofdeposit 25,908 ‐ 25,908 ‐Banker'sacceptances ‐ ‐ ‐ ‐

Totalother 84,350 ‐ 84,350 ‐

Totalinvestmentsbyfairvaluelevel 738,051$ 2,565$ 735,486$ ‐$

DerivativeInstrumentsbyfairvaluelevelInvestmentDerivative (21,712,369)$ ‐$ (21,712,369)$ ‐$Effectivehedge (37,968,733) ‐ (37,968,733) ‐

TotalDerivativeInstrumentsbyfairvaluelevel (59,681,102)$ ‐$ (59,681,102)$ ‐$

FairValueUsing


90

Note6–FairValueMeasurement(continued)TheAuthorityhasthefollowingfairvaluemeasurementsatJune30,2015:

Quotedpricesinactive Significantmarkets other Significant

foridentical observable unobservableJune30, assets inputs inputs2015 (Level1) (Level2) (Level3)

InvestmentsbyfairvaluelevelDebtsecurities

U.S.governmentsecurities -$ ‐$ ‐$ ‐$U.S.agencies 530,668 ‐ 530,668 ‐

Totaldebtsecurities 530,668 ‐ 530,668 ‐

OtherCommercialPaper 121,965 ‐ 121,965 ‐Certificateofdeposit 21,500 ‐ 21,500 ‐Banker'sacceptances 3,800 ‐ 3,800 ‐

Totalother 147,265 ‐ 147,265 ‐

Totalinvestmentsbyfairvaluelevel 677,933$ ‐$ 677,933$ ‐$

FairValueUsing

Note7–Long‐TermDebtLong‐termdebt outstanding at June30, 2016 consisted of “newmoney” bonds, refundingbonds, andsubordinate refunding bonds due in varying annual amounts through July 1, 2040. The newmoneybondswereissuedtofinancethepurchaseandconstructionoracquisitionoftheAuthority’sinterestineachof theProjects.The refundingand subordinate refundingbondswere issued to refund specifiednewmoneybonds.


91

Note7–Long‐TermDebt(continued)Inaccordancewiththebondindentures,thenewmoneybondsandrefundingbondsarespecial,limitedobligationsoftheAuthority.WiththeexceptionoftheMagnoliaPowerProjectB,LeaseRevenueBonds(City of Cerritos, California) 2003‐1 (Project B Bonds), the bonds issued by each project are payablesolelyfromandsecuredsolelybyinterestsinthatprojectasfollows: Proceedsfromthesaleofbonds; All revenues, incomes, rents, and receipts attributable to that project and interest earned on

securitiesheldunderthebondindentureorindentures;and Allfundsestablishedbytheindentureorindentures.The Authority has agreed to certain covenants with respect to bonded indebtedness, including therequirementtoenforcethenaturalgas,power,andtransmissionsalesagreementswiththeparticipants.At the option of theAuthority, all outstandingnewmoneybonds and refundingbonds are subject toredemptionprior tomaturity, except for the2006‐1MagnoliaRevenueBonds; the2015AandB, the2013SeriesAandB,the2012SeriesA,the2011SeriesASubordinateRefundingBonds,andportionsofthe2015C,the2009A,,the2008A,andthe1992SubordinateRefundingBondsissuedfortheSouthernTransmissionSystem;portionsofthe2016Aandthe2012SeriesAMead‐PhoenixandMead‐AdelantoBonds; the 2007 Series A and B Prepaid Natural Gas Project No. 1 Bonds; portions of the 2016ARefundingRevenueBondsandthe2010SeriesAandBCanyonPowerRevenueBonds;portionsofthe2010‐1MilfordIWindRevenueBonds;portionsofthe2011‐1MilfordIIWindRevenueBonds;portionsofthe2010SeriesALindenWindRevenueBonds;andportionsofthe2010‐1WindyPoint/WindyFlatsRevenueBonds.Variableratedebtincludesdebtwithratesbasedondaily,weekly,andlong‐termratesasdeterminedbyaRemarketingAgent.


92

Note7–Long‐TermDebt(continued)Asummaryofchangesinlong‐termdebtfollows(amountsinthousands):

PaloVerde SanJuan MagnoliaPower CanyonPower ApexPower HooverUpratingTietonHydro‐

power MilfordIWind MilfordIIWind WindyPoint LindenWind

Totallong‐termdebtatJune30,2015 24,440$ 21,345$ 319,423$ 307,987$ 323,602$ 4,181$ 49,931$ 204,704$ 149,610$ 463,114$ 127,753$TotaldebtduewithinoneyearatJune30,2015 11,690 21,590 10,985 ‐ 9,335 1,930 840 8,820 5,530 19,390 3,670

TotaldebtatJune30,2015 36,130 42,935 330,408 307,987 332,937 6,111 50,771 213,524 155,140 482,504 131,423

Principalpayments (11,690) (21,590) (10,985) ‐ (9,335) (1,930) (840) (8,820) (5,530) (19,390) (3,670)Revenuebondsissued ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Bondsrefunded/defeased ‐ ‐ ‐ (81,720) ‐ ‐ ‐ ‐ ‐ ‐ ‐Refundingbondsissued ‐ ‐ ‐ 79,635 ‐ ‐ ‐ ‐ ‐ ‐ ‐Changeinunamortizedpremiums&discounts ‐ ‐ (1,004) 7,709 (748) (10) (64) (1,129) (1,848) (5,339) (871)

TotaldebtatJune30,2016 24,440 21,345 318,419 313,611 322,854 4,171 49,867 203,575 147,762 457,775 126,882

TotaldebtduewithinoneyearatJune30,2016 (12,030) (21,345) (11,470) (6,735) (9,375) (2,030) (870) (9,175) (5,795) (20,145) (3,820)

Totallong‐termdebtatJune30,2016 12,410$ ‐$ 306,949$ 306,876$ 313,479$ 2,141$ 48,997$ 194,400$ 141,967$ 437,630$ 123,062$


System Mead‐Phoenix Mead‐Adelanto Pinedale BarnettPrepaidNatural

Gas Total

Totallong‐termdebtatJune30,2015 667,654$ 29,730$ 99,570$ 22,489$ 52,836$ 308,387$ 3,176,756$TotaldebtduewithinoneyearatJune30,2015 53,085 5,480 17,690 2,274 5,326 4,075 181,710

TotaldebtatJune30,2015 720,739 35,210 117,260 24,763 58,162 312,462 3,358,466

Principalpayments (53,085) (5,480) (17,690) (2,274) (5,326) (4,075) (181,710)Revenuebondsissued ‐ 22,610 27,413 ‐ ‐ ‐ 50,023Bondsrefunded/defeased ‐ ‐ ‐ ‐ ‐ ‐ (81,720)Refundingbondsissued ‐ ‐ ‐ ‐ ‐ ‐ 79,635Changeinunamortizedpremiums&discounts (10,570) 3,831 3,100 ‐ ‐ (254) (7,197)

TotaldebtatJune30,2016 657,084 56,171 130,083 22,489 52,836 308,133 3,217,497

TotaldebtduewithinoneyearatJune30,2016 (53,650) (5,515) (17,985) (2,249) (5,266) (4,275) (191,730)

Totallong‐termdebtatJune30,2016 603,434$ 50,656$ 112,098$ 20,240$ 47,570$ 303,858$ 3,025,767$


GREENPOWERGENERATION


93

Note7–Long‐TermDebt(continued)PaloVerdeProject–DebtconsistsofsubordinaterefundingseriesbondswithvariableinterestratesandfinalmaturityoccurringonJuly1,2017.SanJuanProject–Debtconsistsofrefundingseriesbondswithfixedinterestratesof0.79%andfinalmaturityonJanuary1,2017.SanJuanPowerProjectRefundingBonds–OnDecember19,2014,SCPPAissued$42,935,000ofSanJuanUnit 3 Power Project 2014 Series A Refunding Bonds. These fixed rate bonds were issued for thepurpose of refunding the outstanding 2005 Refunding Series A bonds and to pay costs of issuancerelated to the 2014 bonds. The transaction generated 7% or over $4.96million in net present valuesavings.Thetransactionresultedinanetlossforaccountingpurposesofapproximately$111,000.MagnoliaPowerProject–Debtconsistsofrevenueandrefundingseriesbondswithvariableandfixedinterestratesbetween3.00%and5.00%withfinalmaturitiesoccurringin2036.Of the outstanding Magnolia Power Project Revenue Bonds, $124 million of “Project B Bonds” aresecuredby leaserentalpayments tobemadeby theCityofCerritos(theCity) inconnectionwith thelease of certain facilities and premises owned by the City to theAuthority and the leaseback of suchfacilitiesandpremisestotheCity.TheBaseRentalPaymentswillbeequaltotheprincipalandinterestontheProjectBBonds.InaccordancewiththeAssignmentAgreementbetweentheAuthorityandtheTrustee,theAuthoritywillassigncertainofitsrightsunderthelease,includingitsrighttoreceivetheBaseRentalPayments,totheTrusteeforthebenefitoftheownersoftheProjectBBonds.TheCityhascovenantedtobudgetandappropriatesufficientfundstomakeallpaymentsrequiredtobemadeunderthelease.Theleasehasatermof55years.CanyonPowerProject–AsofJune30,2016,debtconsistsofrevenuebondswithfixedinterestratesrangingfrom2.00%to5.94%andfinalmaturityoccurringin2040.CanyonPowerProjectRefundingRevenueBonds–OnApril13,2016,SCPPAissued$79,635,000oftax‐exemptCanyonPowerProject2016SeriesARefundingBonds(the“2016SeriesABonds”).Thesefixedrate bonds were issued to advance refund certain maturities of the outstanding CPP 2010 Series ABonds and to pay costs of issuance relating to the 2016 Series A Bonds. The refunding transactiongenerated net present value savings of $4.2 million, a combined true interest cost of 2.53% and anaverage life of 7.981 years. This transaction resulted in a net loss for accounting purposes of $6.4million.


94

Note7–Long‐TermDebt(continued)OnJune9,2010the2010SeriesBBondswereissuedasBuildAmericaBondsthatare“qualifiedbonds”under theprovisionsof theAmericanRecovery andReinvestmentAct of 2009.The interest on thesebondswillnotbeexcludedfromgrossincomeforfederalincometaxpurposes,butwillbeexemptfromtheStateofCaliforniapersonalincometaxes.Assuch,theAuthoritymayreceiveacashsubsidyfromtheUnitedStatesTreasuryupto35%oftheinterestpayableonthe2010SeriesBBondswhichisappliedtooffsettheinterestcostsofthe2010SeriesBBonds.ApexPowerProject–Debtconsistsof revenuebondswith fixed interest ratesbetween0.646%and5.00%andfinalmaturityoccurringin2038.HooverUpratingProject–Debtconsistsofrefundingseriesbondswithfixedinterestratesof5.25%andafinalmaturityoccurringonOctober1,2017.TietonHydropowerProject–AsofJune30,2016,debtconsistsofrevenuebondswithfixedinterestratesbetween4.326%and5.798%andafinalmaturityoccurringin2040.MilfordIWindProject–AsofJune30,2016,debtconsistsofrevenuebondswithfixedinterestratesrangingfrom3.00%to5.00%andfinalmaturityoccurringin2030.MilfordIIWindProject–AsofJune30,2016,debtconsistsofrevenuebondswithfixedinterestratesrangingfrom3.00%to5.25%andfinalmaturityoccurringin2031.LindenWindEnergyProject–AsofJune30,2016,debtconsistsofrevenuebondswithfixedinterestratesbetween4.00%and5.92%andfinalmaturityoccurringin2035.LindenWindEnergyProjectRevenueBonds–OnSeptember28,2010,SCPPAissued$138.3millionoftheLindenWindEnergyProjectRevenueBonds, consistingof$96.8millionof2010SeriesATaxExemptBondsand$41.5millionoftheSeriesBTaxableBuildAmericaBonds,togetherthe2010Bonds.The 2010 Series B Bonds were issued as Build America Bonds that are “qualified bonds” under theprovisionsoftheAmericanRecoveryandReinvestmentActof2009.Theinterestonthesebondswillnotbe excluded from gross income for federal income purposes, but will be exempt from the State ofCaliforniapersonalincometaxes.Assuch,theAuthorityreceivesacashsubsidyfromtheUnitedStatesTreasuryup to35%of the interestpayableonthe2010SeriesBBondswhich isappliedtooffset theinterestcostsofthe2010SeriesBBonds.SouthernTransmissionSystemProject–Debtconsistsofrefundingandsubordinaterefundingseriesbondswithfixedinterestratesrangingfrom0.470%to6.125%andfinalmaturitiesoccurringin2027.


95

Note7–Long‐TermDebt(continued)STS Project Refunding Bonds – On March 4, 2015, SCPPA issued $84,640,000 Transmission ProjectRevenueBonds,2015SubordinateRefundingSeriesAand$28,925,000SubordinateSeriesB(TaxableBonds),togetherthe$113,565,0002015A&Bbonds.Thesefixedratebondswereissuedtoredeemalloftheoutstanding$102,000,000TransmissionProjectSubordinateRefundingBonds,2000SeriesA;toterminatethe2000Swap/Swaption;andtopaythecostsof issuanceoftheSTS2015A&Bbonds.Therefundingtransactiongeneratedanetpresentvaluesavingsof$954,453.Thistransactionresultedinanetlossforaccountingpurposesof$31.5million.Inaddition,onMarch25,2015,SCPPAissued$116,535,000TransmissionProjectRevenueBonds,2015SubordinateRefundingSeriesCBonds.Thesefixedratebondswereissuedtoadvancerefundalloftheoutstanding$125,000,000TransmissionProjectSubordinateRefundingBonds,2008SeriesBandtopaythecostsofissuanceoftheSTS2015SeriesCbonds.Therefundingtransactiongeneratedanetpresentvalue savings of approximately $20.7 million. This transaction resulted in a net loss of accountingpurposesof$20.8million.WindyPoint/WindyFlatsProject –As of June30, 2016, debt consists of revenuebondswith fixedinterestratesbetween3.00%and5.00%andfinalmaturityoccurringin2030.MeadPhoenix/MeadAdelantoProjects–Debtconsistsofrevenueandrefundingseriesbondswithvariableinterestandfixedinterestrates.Fixedinterestratesrangefrom1.498%and5.00%withfinalmaturitiesoccurringin2030.Mead Phoenix (LADWP)/Mead Adelanto (LADWP) Revenue Bonds – On May 25, 2016, SCPPA issued$27,415,000ofMead‐AdelantoProject,AuthorityInterest(LADWP)2016SeriesARevenueBondsand$22,610,000ofMead‐PhoenixProject,AuthorityInterest(LADWP)2016SeriesARevenueBondsinanaggregateprincipalamountof$50,025,000,togetherthe“2016SeriesABonds”.Thesetax‐exemptfixedrate bonds were issued to provide funds to pay the costs of acquisition of an additional ownershipinterest in theMead‐AdelantoandMead‐PhoenixProjects.The2016SeriesABondswerepricedat acombinedtrueinterestcostof1.98%andanaveragelifeof8.336years.Multiple ProjectRevenueBonds – In January 1990, the Authority issued $647,750,000 of its MultipleProject Revenue Bonds for the purpose of funding electric generation and/or transmission projectsundertakenbytheAuthority.Proceedsofthefinancingavailableforthefundingofsuchprojectsinitiallyamountedtoapproximately$600,000,000.UpontherequestoftheAuthority’smembers,theapprovalof itsBoardofDirectors, and themeetingof otherpreconditions, portionsof suchproceeds couldbetransferred to fund capital costs of a selected Authority project. In October1992, the Authoritytransferred $285,000,000 of such proceeds to fund costs of the Authority Interest (Members) in theMead‐AdelantoProject.InOctober1992,theAuthorityalsotransferred$103,600,000ofsuchproceedstofundcostsoftheAuthorityInterest(Members)intheMead‐PhoenixProject.


96

Note7–Long‐TermDebt(continued)SinceJuly1,2013,noMultipleProjectRevenueBondshavebeenoutstanding,buttherelatedindentureoftrustremainsineffectinconnectionwiththerevenuebondsfortheAuthorityInterest(Members)intheMead‐AdelantoProjectandtheAuthorityInterest(Members)intheMead‐PhoenixProject.The2016BondswerenotfundedwithproceedsofnoraretheyrelatedtotheMultipleProjectBonds.NaturalGasProjects–Debtconsistsofrevenuebondswithfixedinterestratesrangingfrom4.88%to6.03%andfinalmaturitiesoccurringin2032.PrepaidNaturalGasProject –Debtconsistsof revenuebondswithvariableand fixed interest ratesrangingfrom5.00%to5.25%andfinalmaturityoccurringin2035.


97

Note7–Long‐TermDebt(continued)Premiums / Discounts– Unamortized premiums and discounts, net, which are included in thestatementsofnetpositionasacomponentoflong‐termdebt,areasfollows(amountsinthousands):

June30,2016(Premium)Discount

(2,874)$CanyonPowerProject (14,226)ApexPowerProject (13,329)

(6)TietonHydropowerProject (1,037)MilfordIWindProject (7,200)MilfordIIWindProject (10,397)WindyPointProject (30,390)LindenWindEnergyProject (5,052)

(49,443)(5,866)(11,574)

PrepaidNaturalGasProjectNo.1 (2,593)

(153,987)$

June30,2015(Premium)Discount

(3,878)$CanyonPowerProject (6,517)ApexPowerProject (14,077)

(16)TietonHydropowerProject (1,101)MilfordIWindProject (8,329)MilfordIIWindProject (12,245)WindyPointProject (35,729)LindenWindEnergyProject (5,923)

(60,013)(2,035)(8,474)

PrepaidNaturalGasProjectNo.1 (2,847)

(161,184)$

Unamortized(Premium)Discount,Net

Unamortized(Premium)Discount,Net

HooverUpratingProject

MagnoliaPowerProject

SouthernTransmissionSystemProjectMead‐PhoenixProjectMead‐AdelantoProject

MagnoliaPowerProject

HooverUpratingProject

SouthernTransmissionSystemProjectMead‐PhoenixProjectMead‐AdelantoProject


98

Note7–Long‐TermDebt(continued)Advancerefundings–TheAuthorityhasestablishedirrevocableescrowtrustswiththeproceedsfromissuance of subordinate refunding bonds. These investments will be used to pay specified revenuebondscalledatscheduledredemptiondates.Defeasanceofdebt–TheAuthorityhasdefeasedspecifiedrevenuebondsbyplacingtheproceedsfromtheissuanceofsubordinaterefundingbondsinirrevocabletruststoprovideforallfuturedebtservicepayments on the refunded bonds. The trust investments and related liability for bonds that areconsidered legallydefeasedarenot included in theAuthority’s financial statements.At June30,2016and2015,$511.6millionand$466.6million,respectively,ofrevenuebondsoutstandingareconsideredlegallydefeased.The refundedbondsconstitutea contingent liabilityof theAuthorityonly to theextent that cashandinvestments presently in the control of the refunding trustees are not sufficient tomeet debt servicerequirementsandarethereforeexcludedfromthecombinedfinancialstatementsbecausethelikelihoodofadditionalfundingrequirementsisconsideredremote.Debtservice–ThescheduleddebtservicepaymentsforfutureyearsendingJune30areincludedinthetableonthefollowingpage.ThevariableratesusedforthePV2008SubordinateRefundingSeriesAandBBondswereboth0.0420%.ThevariableratesusedfortheMAG2009‐1andMAG2009‐2were0.400%and 0.390%, respectively. All of the preceding variable rates were the rates at June 30, 2016. Thevariableratesaresetbythebond‐remarketingagentonaweeklybasisbasedoneconomicconditionsandbondratings.


99

Note7–Long‐TermDebt(continued)Futureprincipalandinterestpaymentsareasfollows(amountsinthousands):

PaloVerde SanJuan MagnoliaPower CanyonPower ApexPower HooverUpratingTietonHydro‐

power MilfordIWind MilfordIIWind WindyPointLindenWind

Energy

2017Principal 12,030$ 21,345$ 11,470$ 6,735$ 9,375$ 2,030$ 870$ 9,175$ 5,795$ 20,145$ 3,820$2017Interest 461 169 10,672 15,509 12,537 165 2,468 9,476 6,934 20,449 6,2612018Principal 12,410 ‐ 7,230 7,185 9,435 2,135 910 9,615 6,065 21,045 3,9702018Interest 155 ‐ 10,242 16,102 12,453 56 2,429 9,022 6,646 19,513 6,0852019Principal ‐ ‐ 7,560 7,540 9,545 ‐ 950 10,085 6,370 22,020 4,1702019Interest ‐ ‐ 9,903 15,775 12,316 ‐ 2,385 8,545 6,346 18,515 5,9032020Principal ‐ ‐ 7,925 7,835 9,710 ‐ 1,000 10,570 6,665 23,040 4,3352020Interest ‐ ‐ 9,539 15,450 12,128 ‐ 2,336 8,040 6,030 17,462 5,7112021Principal ‐ ‐ 8,305 8,185 9,920 ‐ 1,050 11,090 7,000 24,125 4,5552021Interest ‐ ‐ 9,152 15,069 11,892 ‐ 2,284 7,508 5,691 16,362 5,5112022‐2026Principal ‐ ‐ 51,765 47,500 54,320 ‐ 7,810 64,135 40,700 139,310 26,1152022‐2026Interest ‐ ‐ 40,054 68,618 54,478 ‐ 10,410 28,647 22,551 62,450 24,0152027‐2031Principal ‐ ‐ 69,655 55,135 65,355 ‐ 8,420 81,705 52,550 177,700 33,3152027‐2031Interest ‐ ‐ 29,962 55,441 42,972 ‐ 8,049 10,609 10,386 23,078 16,6272032‐2036Principal ‐ ‐ 85,175 72,110 82,090 ‐ 10,745 ‐ 12,220 ‐ 41,5502032‐2036Interest ‐ ‐ 17,630 36,939 25,606 ‐ 5,664 ‐ 321 ‐ 6,3362037‐2041Principal ‐ ‐ 66,460 87,160 59,775 ‐ 17,075 ‐ ‐ ‐ ‐2037‐2041Interest ‐ ‐ 1,060 13,342 4,581 ‐ 2,539 ‐ ‐ ‐ ‐2042‐2043Principal ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐2042‐2043Interest ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Principal 24,440$ 21,345$ 315,545$ 299,385$ 309,525$ 4,165$ 48,830$ 196,375$ 137,365$ 427,385$ 121,830$

Interest 616$ 169$ 138,214$ 252,245$ 188,963$ 221$ 38,564$ 81,847$ 64,905$ 177,829$ 76,449$

GREENPOWERGENERATION


100

Note7–Long‐TermDebt(continued)


System Mead‐Phoenix Mead‐Adelanto Pinedale BarnettPrepaidNatural

Gas Total

2017Principal 53,650$ 5,515$ 17,985$ 2,249$ 5,266$ 4,275$ 191,730$2017Interest 27,140 1,620 4,663 1,215 2,855 15,450 138,0442018Principal 54,315 6,850 19,820 1,980 4,640 4,605 172,2102018Interest 24,876 1,740 4,359 1,104 2,596 15,228 132,6062019Principal 56,100 7,185 20,705 1,770 4,150 5,385 163,5352019Interest 22,176 1,471 3,381 1,003 2,357 14,978 125,0542020Principal 49,005 7,365 21,565 1,627 3,818 6,445 160,9052020Interest 19,632 1,214 2,347 907 2,134 14,675 117,6052021Principal 64,465 5,990 17,110 1,522 3,573 7,725 174,6152021Interest 17,220 949 1,441 819 1,926 14,303 110,1272022‐2026Principal 269,015 7,695 9,370 6,387 15,013 57,550 796,6852022‐2026Interest 40,707 3,352 4,206 2,940 6,930 63,727 433,0852027‐2031Principal 61,091 9,705 11,954 5,115 12,040 98,965 742,7052027‐2031Interest 2,935 1,260 1,553 1,286 3,037 43,709 250,9042032‐2036Principal ‐ ‐ ‐ 1,839 4,336 120,590 430,6552032‐2036Interest ‐ ‐ ‐ 109 257 13,839 106,7012037‐2041Principal ‐ ‐ ‐ ‐ ‐ ‐ 230,4702037‐2041Interest ‐ ‐ ‐ ‐ ‐ ‐ 21,5222042‐2043Principal ‐ ‐ ‐ ‐ ‐ ‐ ‐2042‐2043Interest ‐ ‐ ‐ ‐ ‐ ‐ ‐

Principal 607,641$ 50,305$ 118,509$ 22,489$ 52,836$ 305,540$ 3,063,510$

Interest 154,686$ 11,606$ 21,950$ 9,383$ 22,092$ 195,909$ 1,435,648$



101

Note8–NotesPayableandOtherLiabilitiesNotes payable and other liabilities consistmainly of Palo Verde Participants’ overbillings from priorperiods; an allowance for future major maintenance expenses for the Magnolia Power Project; andswap‐relatedtransactionfeesreceivedintheMeadAdelantoProject.ThenotespayableheldinthePaloVerdeProjectareinvestedinaguaranteedinvestmentcontract(GIC)thatwillmatureinJune2017.TheGICisunsecured,bearsaninterestrateat4.97%,andispaidoutinmonthlyinstallmentsof$0.6million.OnJune30,2016,theremainingbalanceoftheGICis$7.4million.Thethree‐yearsuspensionoftheMeadAdelanto2007CMS(theCMSSwap)inNovember2008nettedacompensation of $4.1 million. In June 2010, the suspension was extended to June 2018 for a netcompensationof$5.0million.ThetotaldeferredbalanceoftheCMSSwapis$0.6millionasofJune30,2016.(SeeNote5).Notespayableandotherliabilitiesrollforward(amountsinthousands):

DescriptionJune30,2015 Additions

Payments/Amortization

AmortizationofSurplusFund

June30,2016

PVprioryearoverbillings 13,724$ ‐$ (7,070)$ 393$ 7,047$MPPmajormaintenance 13,152 5,314 (669) ‐ 17,797MeadAdelanto2007Swapsuspension 1,848 ‐ (628) ‐ 1,220Netpensionliability 874 137 ‐ ‐ 1,011

29,598$ 5,451$ (8,367)$ 393$ 27,075$

Note9–AdvancesfromParticipantsAdvances from participants consist mainly of billings to participants related to acquisition, capitaldrilling, and inventorywherein thematching operating expenseswill be recognized at a future date.Also,andspecificonlytotheNaturalGasPinedaleProject,advancesheldbytheprojectarefundsfromLADWP and TID, both owners independent of SCPPA, and are for their share of operating costs andcapitalexpenditurespursuanttotheirrespectiveAgencyAgreements.


102

Note9–AdvancesfromParticipants(continued)Advancesfromparticipants’rollforward(amountsinthousands):

Description June30,2015 Activity June30,2016

SanJuanadvancesfromparticipants 9,332$ 14,014$ 23,346$Magnoliaadvancesfromparticipants 17,796 9,310 27,106CanyonPoweradvancesfromparticipants 2,225 ‐ 2,225Tietonadvancesfromparticipants 202 ‐ 202MilfordIadvancesfromparticipants 250 ‐ 250MilfordIIadvancesfromparticipants 250 ‐ 250WindyPointadvancesfromparticipants 1,000 ‐ 1,000LindenWindEnergyadvancesfromparticipants 2,004 ‐ 2,004NGPinedaleadvancesfromparticipants 19,862 1,608 21,470NGBarnettadvancesfromparticipants 9,770 (710) 9,060Ormatadvancesfromparticipants 857 ‐ 857MWDadvancesfromparticipants 500 ‐ 500Amerescoadvancesfromparticipants 400 ‐ 400PDFadvancesfromparticipants 6,485 (3,688) 2,797SCPPABuildingadvancesfromparticipants 133 2,376 2,509DonA.Campbell/WildRoseadvancesfromparticipants 480 1,149 1,629Columbia2Solaradvancesfromparticipants 538 (133) 405DonA.Campbell2advancesfromparticipants ‐ 400 400KingbirdSolaradvancesfromparticipants ‐ 404 404Heber1advancesfromparticipants ‐ 400 400

72,084$ 25,130$ 97,214$

Note10–NetPositionTheAuthority’s billing amounts to the participants are determined by its Board ofDirectors and aresubject to review and approval by the participants. Billings to participants are designed to recover“costs” as defined by the power sales, natural gas sales, and transmission service agreements. Thebillings are structured to systematically provide for debt service requirements, operating funds, andreserves in accordancewith these agreements. The accumulated difference between billings and theAuthority’s expenses calculated in accordance with accounting principles generally accepted in theUnited States of America are presented as Net Position. It is intended that this difference will berecoveredinthefuturethroughbillingsforrepaymentofprincipalontherelatedbonds.


103

Note10–NetPosition(continued)Netpositioniscomprisedofthefollowing(inthousands):

June30,2014

FiscalYear2015Activity June30,2015

FiscalYear2016Activity June30,2016

GAAPitemsnotincludedinbillingstoparticipantsDepreciationofplant (1,620,330)$ (106,590)$ (1,726,920)$ (106,526)$ (1,833,446)$Nuclearfuelamortization (5,860) ‐ (5,860) ‐ (5,860)Decommissioningexpense (224,510) (10,857) (235,367) (21,214) (256,581)Amortizationofbonddiscount,debtissuecosts,andlossonrefundings (806,657) (8,928) (815,585) 7,277 (808,308)

Interestexpense (54,948) 53 (54,895) (5) (54,900)Lossondefeasanceofbonds (85,827) ‐ (85,827) ‐ (85,827)Derivativesandrelatedcharges (39,512) 28,364 (11,148) (10,238) (21,386)Pensionexpense ‐ (730) (730) (85) (815)

BondrequirementsincludedinbillingstoparticipantsOperationsandmaintenance,netofinvestmentincome 82,047 (62,911) 19,136 (50,643) (31,507)

Costsofacquisitionofcapacity 4,983 (1,570) 3,413 (1,519) 1,894Billingstoamortizecostsrecoverable 382,050 ‐ 382,050 ‐ 382,050Reductionindebtservicebillingsduetotransferofexcessfunds (90,020) ‐ (90,020) (3,863) (93,883)

Principalrepayments 1,952,524 177,424 2,129,948 191,761 2,321,709Withdrawaloffunds (24,821) ‐ (24,821) ‐ (24,821)Other 280,167 20,421 300,588 14,520 315,108

(250,714) 34,676 (216,038) 19,465 (196,573)Projects’StabilizationFundnetposition 152,027 4,560 156,587 (8,965) 147,622

(98,687)$ 39,236$ (59,451)$ 10,500$ (48,951)$

Note11–PensionPlansPlandescriptions–AllqualifiedpermanentandprobationaryemployeesareeligibletoparticipateinSCPPA’sMiscellaneousEmployeePensionPlans,cost‐sharingmultipleemployerdefinedbenefitpensionplans administered by the California Public Employees’ Retirement System (CalPERS). Benefitprovisions under the Plans are established by State statute and SCPPA resolution. CalPERS issuespublicly available reports that include a full description of the pension plans regarding benefitprovisions,assumptionsandmembershipinformationthatcanbefoundontheCalPERSwebsite.Benefitsprovided–CalPERSprovidesserviceretirementanddisabilitybenefits,annualcostof livingadjustments and death benefits to plan members, who must be public employees and beneficiaries.Benefits are basedon years of credited service, equal to one year of full time employment.Memberswith five years of total service are eligible to retire at age 50 with statutorily reduced benefits. Allmembersareeligiblefornon‐dutydisabilitybenefitsafter10yearsofservice.


104

Note11–PensionPlans(continued)The death benefit is one of the following: the Basic Death Benefit, the 1957 Survivor Benefit, or theOptional Settlement 2W Death Benefit. The cost of living adjustments for each plan are applied asspecifiedbythePublicEmployees’RetirementLaw.ThePlans’provisionsandbenefitsineffectatJune30,2016,aresummarizedasfollows:

PriortoJanuary1,2013

OnorafterJanuary1,2013

HiredateBenefitformula 2.7%@55 2%@62Benefitvestingschedule 5yearsservice 5yearsserviceBenefitpayments monthlyforlife monthlyforlifeRetirementage 50‐55 52‐67Monthlybenefits,asa%ofeligiblecompensation 2.0%to2.7% 1.0%to2.5%Requiredemployeecontributionrates 8% 6.5%Requiredemployercontributionrates 19.6% 6.7%

Contributions–Section20814(c)oftheCaliforniaPublicEmployees’RetirementLawrequiresthattheemployercontributionratesforallpublicemployersbedeterminedonanannualbasisbytheactuaryandshallbeeffectiveon the July1 followingnoticeofachange in therate.Fundingcontributions forboth Plans are determined annually on an actuarial basis as of June 30 by CalPERS. The actuariallydeterminedrateistheestimatedamountnecessarytofinancethecostsofbenefitsearnedbyemployeesduringtheyear,withanadditionalamounttofinanceanyunfundedaccruedliability.SCPPAisrequiredto contribute the difference between the actuarially determined rate and the contribution rate ofemployees.FortheyearendedJune30,2016,thecontributionsrecognizedaspartofpensionexpenseforthePlanswere$152,749.Pension liabilities, pension expenses and deferred outflows / inflows of resources related topensions – As of June 30, 2016, SCPPA reported a net pension liability of $1,010,974 for itsproportionateshareofthenetpensionliability.SCPPA’snetpensionliabilityforeachPlanismeasuredas theproportionateshareof thenetpension liability.Thenetpension liabilityofeachof thePlans ismeasured as of June 30, 2015, and the total pension liability for each Plan used to calculate the netpensionliabilitywasdeterminedbyanactuarialvaluationasofJune30,2014rolledforwardtoJune30,2015usingstandardupdateprocedures.SCPPA’sproportionofthenetpensionliabilitywasbasedonaprojection of SCPPA’s long‐term share of contributions to the pension plans relative to the projectedcontributionsofallparticipatingemployers,actuariallydetermined.SCPPA’sproportionateshareofthenet pension liability for the Plans was 0.03604% and 0.01404% as of the June 30, 2015 and 2014measurementdates,respectively.


105

Note11–PensionPlans(continued)For theyear ended June30,2016, SCPPA recognizedpensionexpenseof $152,749.At June30,2016,SCPPAreporteddeferredoutflowsof resourcesanddeferred inflowsof resourcesrelated topensionsfromthefollowingsources:

DeferredOutflowsofResources

DeferredInflowsofResources

Pensioncontributionssubsequenttomeasurementdate 278,896$ ‐$Changeinemployer'sproportionanddifferencesbetweentheemployer's

contributionsandtheemployer'sproportionateshareofcontributions 144,230 ‐Differencesbetweenactualandexpectedexperience 17,039Changesinassumptions ‐ (161,200)Netdifferencesbetweenprojectedandactualearningsonplaninvestments ‐ (80,811)

Total 440,165$ (242,011)$

$278,896 reported as deferred outflows of resources related to contributions subsequent to themeasurement date will be recognized as a reduction of the net pension liability in the year endedJune30, 2016. Other amounts reported as deferred outflows of resources and deferred inflows ofresourcesrelatedtopensionswillberecognizedaspensionexpenseasfollows:ForthePeriodEndedJune30, 2017 (20,846)$

2018 (27,724)2019 (50,820)2020 18,648

(80,742)$


106

Note11–PensionPlans(continued)Actuarialassumptions – The total pension liabilities in the June 30, 2014 actuarial valuationsweredeterminedusingthefollowingactuarialassumptions:ValuationDate June30,2014MeasurementDate June30,2015ActuarialCostMethod Entry‐AgeNormalActuarialAssumptions:

DiscountRate 7.65%Inflation 2.75%PayrollGrowth 3.0%

ProjectedSalaryIncreaseVariesbyEntryAgeandService

InvestmentRateofReturn 7.5%(1)

Mortality

DerivedusingCalPERS'

MembershipData

(1)Netpensionplaninvestmentexpenses,includinginflation

The underlyingmortality assumptions and all other actuarial assumptions used in the June 30, 2014valuation were based on the results of an actuarial experience study for the period 1997 to 2011.FurtherdetailsoftheExperienceStudycanbefoundontheCalPERSwebsite.Discountrate–Thediscountrateusedtomeasurethetotalpensionliabilitywas7.65%forthePlans.Todeterminewhetherthemunicipalbondrateshouldbeusedinthecalculationofadiscountrateforthe Plans, CalPERS stress tested plans thatwouldmost likely result in a discount rate thatwouldbedifferentfromtheactuariallyassumeddiscountrate.Basedonthetesting,noneofthetestedplansrunoutofassets.Therefore,thecurrent7.65%discountrateisadequateandtheuseofthemunicipalbondratecalculation isnotnecessary.The longtermexpecteddiscountrateof7.65%willbeappliedtoallplans in the Public Employees Retirement Fund (PERF). The stress test results are presented in adetailedreportthatcanbeobtainedfromtheCalPERSwebsite.Accordingtoparagraph30ofStatement68,thelong‐termdiscountrateshouldbedeterminedwithoutreduction forpensionplanadministrativeexpense.The7.65% investment returnassumptionused inthisaccountingvaluationisnetofadministrativeexpenses.Administrativeexpensesareassumedtobe15basispoints.Aninvestmentreturnexcludingadministrativeexpenseswouldhavebeen7.65%.Usingthislowerdiscountratehasresultedinaslightlyhighertotalpensionliabilityandnetpensionliability.CalPERSchecked themateriality threshold for thedifference in calculationanddidnot find it tobeamaterialdifference.


107

Note11–PensionPlans(continued)CalPERS is scheduled to review all actuarial assumptions as part of its regular Asset LiabilityManagement(ALM)reviewcycle that isscheduledtobecompleted inFebruary2018.AnychangestothediscountratewillrequireBoardactionandproperstakeholderoutreach.Forthesereasons,CalPERSexpectstocontinueusingadiscountratenetofadministrativeexpensesforGASB67and68calculationsthroughatleastthe2017‐18fiscalyear.CalPERSwillcontinuetocheckthematerialityofthedifferenceincalculationuntilsuchtimeasCalPERShaschangeditsmethodology.The long‐termexpectedrateofreturnonpensionplan investmentswasdeterminedusingabuilding‐blockmethod inwhichbest‐estimaterangesofexpected futurerealratesofreturn(expectedreturns,netofpensionplaninvestmentexpenseandinflation)aredevelopedforeachmajorassetclass.Indeterminingthelong‐termexpectedrateofreturn,CalPERStookintoaccountbothshort‐termandlong‐termmarketreturnexpectationsaswellastheexpectedpensionfundcashflows.Usinghistoricalreturnsofall the funds’assetclasses,expectedcompoundreturnswerecalculatedover theshort‐term(first10years) and the long‐term (11‐60 years) using a building‐block approach. Using the expected nominalreturnsforbothshort‐termandlong‐term,thepresentvalueofbenefitswascalculatedforeachfund.Theexpectedrateofreturnwassetbycalculatingthesingleequivalentexpectedreturnthatarrivedatthesamepresentvalueofbenefitsforcashflowsastheonecalculatedusingbothshort‐termandlong‐termreturns.Theexpectedrateofreturnwasthensetequivalenttothesingleequivalentratecalculatedaboveandroundeddowntothenearestonequarterofonepercent.Thetablebelowreflectsthelong‐termexpectedrealrateofreturnbyassetclass.Therateofreturnwascalculated using the capital market assumptions applied to determine the discount rate and assetallocation.Theseratesofreturnarenetofadministrativeexpenses.

NewStrategicAllocation

RealReturnYears1‐10(a)

RealReturnYears11+(b)

GlobalEquity 51.0% 5.25% 5.71%GlobalFixedIncome 19.0% 0.99% 2.43%InflationSensitive 6.0% 0.45% 3.36%PrivateEquity 10.0% 6.83% 6.95%RealEstate 10.0% 4.50% 5.13%InfrastructureandForestland 2.0% 4.50% 5.09%Liquidity 2.0% ‐0.55% ‐1.05%

Total 100.0%

(a) Anexpectedinflationof2.5%usedforthisperiod(b) Anexpectedinflationof3.0%usedforthisperiod

AssetClass


108

Note11–PensionPlans(continued)Sensitivityoftheproportionateshareofthenetpensionliabilitytochangesinthediscountrate–ThefollowingpresentsSCPPA’sproportionateshareofthenetpensionliabilityforthePlans,calculatedusing thediscountrate foreachPlan,aswellaswhatSCPPA’sproportionateshareof thenetpensionliability would be if it were calculated using a discount rate that is 1‐percentage point lower or 1‐percentagepointhigherthanthecurrentrate:1%Decrease 6.65%NetPensionLiability 1,697,764$

CurrentDiscountRate 7.65%NetPensionLiability 1,010,974$

1%Increase 8.65%NetPensionLiability 446,442$

Pensionplan fiduciarynetposition–Detailed information about each pension plan’s fiduciary netpositionisavailableintheseparatelyissuedCalPERSfinancialreports.Payable to the pension plan – At June 30, 2016, SCPPA did not have an outstanding amount ofcontributionspayabletothepensionplanfortheyearendedJune30,2016.


109

Note12–CommitmentsandContingenciesPublic benefits – The members continue to collect the public benefit charge through existing ratestructuresandhaveinstitutedprogramstobenefit theircustomers includingconservationandenergyefficiency programs, public educational programs, research and development, and low income ratesubsidies, totaling a combined $2.0 billion since their inception in 1997. Thedecisions onhow thesefundsareallocatedaremadebythelocalgoverningauthority,inmostcasesthisisthecitycouncil.Executiveactionandstate legislation–Anumber of bills affecting the electric industry havebeenintroduced or enacted by the California Legislature. In general, these bills regulate greenhouse gasemissions and provide for greater investment in energy efficiency and environmentally friendlygeneration and storage alternatives through more stringent renewable resource portfolio standardrequirements.Thefollowingisabriefsummaryofcertainofthesebillsthathavebeenenacted:Greenhouse gas emissions – Executive Order S‐3‐05 placed an emphasis on efforts to reducegreenhousegasemissionsbyestablishingstatewidegreenhousegasreductiontargets.Thetargetsare:(i) a reduction to 2000 emission levels by 2010; (ii) a reduction to 1990 levels by 2020; and (iii) areduction to 80% below 1990 levels by 2050. The Executive Order also called for the CaliforniaEnvironmentalProtectionAgency (the “EPA”) to leadamulti‐agencyeffort toexamine the impactsofclimate change on California and develop strategies and mitigation plans to achieve the targets. Inaddition,ExecutiveOrderS‐06‐06directstheStateofCaliforniatomeeta20%biomassutilizationtargetwithin the renewable generation targets of 2010 and 2020 for the contribution to greenhouse gasemission reduction. Executive Order B‐30‐15 was issued on April 29, 2015 setting a new interimstatewide greenhouse gas emissions reduction target to 40% below 1990 levels by 2030 to ensureachieving the2050emissions reduction target.The interimgoalwas since incorporated intopendinglegislation,SB32(Pavley),currentlybeingconsideredintheCaliforniaStateAssembly.


110

Note12–CommitmentsandContingencies(continued)Assembly Bill 32, the GlobalWarming Solutions Act of 2006 (the GWSA) became effective as law onJanuary1,2007. The GWSA prescribed a statewide cap on global warming pollution with a goal ofreaching 1990 greenhouse gas emission levels by 2020. In addition, the GWSA establishes an annualmandatory reporting program for all investor‐owned utilities (IOUs), local publicly‐owned electricutilities (“POUs”), and other load‐serving utilities (electric utilities providing energy to end‐usecustomers) to inventory and report greenhouse gas emissions to the California Air Resources Board(CARB) and requires CARB to adopt regulations for significant greenhouse gas emission sources(allowing CARB to design a cap‐and‐trade system), and gives CARB the authority to enforce suchregulations beginning in 2012. CARB adopted a “scoping plan” to reduce greenhouse gas emissionswhich includedamixed approachofmarket structures, regulation, fees andvoluntarymeasures.Thescoping plan included a cap‐and‐trade system that covers 85% of all California greenhouse gasemissions.InAugust2011,CARBrevisedthescopingplaninresponsetolitigation.Therevisedscopingplancontinuedto includeacap‐and‐tradeprogram.Thescopingplan isrequired tobeupdatedeveryfiveyearsandtheupdatedscopingplanwasapprovedonMay22,2014.On October 20, 2011, CARB adopted a regulation, which was approved on December 13, 2011,implementing a cap‐and‐trade system. The cap‐and‐trade regulation became effective on January1,2012, and emission compliance obligations under the cap‐and‐trade regulation began on January1,2013. The cap‐and‐trade program is the largest of its type in the United States and covers sourcesaccountingfor85%ofCalifornia’sgreenhousegasemissions.The cap‐and‐trade program is being implemented in phases. The first phase of the program wasimplemented from January 1, 2013 to December 31, 2014 and introduced a hard emissions cap thatcovered emissions from electricity generators, electricity importers, and large industrial sourcesemittingmorethan25,000metrictonsofcarbondioxide‐equivalentgreenhousegases(CDE)peryear.In2015,theprogramwasexpandedtocoveremissionsfromtransportationfuels,naturalgas,propane,andother fossil fuels.Thecapwilldeclineeachyearuntil theendof theprogram,which is currentlyscheduledforDecember2020unlessotherwiseextended.The cap‐and‐trade program includes the distribution of carbon allowances equal to the annualemissions cap. Each allowance is equal to one metric ton of CDE. Initially, as part of the transitionprocess, most of the carbon allowances were distributed for free. Quarterly auctions for additionalallowances began inNovember 2012. IOUs, aswell as POUs that sell electricity into the ISOmarkets(includingsomeProjectParticipants),willberequiredtoauctiontheirallowances.Theywillthenneedto purchase allowances tomeet their compliance obligations, anduse the remaining from the sale oftheirallocatedallowancesforthebenefitoftheirratepayers.


111

Note12–CommitmentsandContingencies(continued)On January 1, 2014, the California cap and trade program was linked to the equivalent program inQuebec,Canada,aspartof theWesternClimate Initiative.TheWesternClimate Initiative isaregionaleffort consisting of California and four Canadian provinces (Quebec, British Colombia, Ontario, andManitoba),whichhaveestablishedagreenhousegasreductiontradingframework.OnApril25,2014,CARBadoptedvariouschanges to thecap‐and‐tradeprogram, includingprovisionsrelating to the electricity sector such as “safe harbor” provisions under the “resource shuffling”prohibition.ThesechangesbecameeffectiveonJuly1,2014.Additionalamendmentsareexpectedtobeconsideredthrough2016,includingregardingpost‐2020programmaticissuesandanyneededchangestocomplywiththefederalCleanPowerPlan.TheAuthorityandtheProjectParticipantsareunabletopredictatthistimethefullimpactofthecap‐and‐trade program on the Project Participants’ respective electric utilities or on the electric utilityindustry in general. However, the Project Participants could be adversely affected if the carbonemissions of their respective resource portfolios are in excess of the allowances administrativelyallocatedtothem,andtheyarerequiredtopurchaseallowancesonthemarkettocovertheiremissions.Emissionsperformancestandards–SenateBill1368(SB1368)becameeffectiveaslawonJanuary1,2007.Itprovidesforanemissionperformancestandard,restrictingnewinvestmentsinbaseloadfossilfuel electric generating resources that exceed the rate of greenhouse gas emissions for existingcombined‐cycle natural gas baseload generation. SB 1368 allows the California Energy Commission(CEC) to establish a regulatory framework to enforce the greenhouse gas emission performancestandardforPOUssuchastheProjectParticipants.InJanuary2012,theCECinitiatedareviewoftheseregulationstoensurethereisadequatereviewofinvestmentsinfacilitiesthatdonotmeettheemissionperformancestandard.OnMarch19,2014, theCEC issued itsFinalConclusions in theEPSproceeding.TheCECproposed toexpandthepublicnoticerequirementsothatapublicly‐ownedutilitywouldhavetopostanoticeofapublicmeetingatwhichitsgoverningboardwouldconsideranyexpendituresover$2.5milliontomeetenvironmental regulatory requirements at a non‐EPS compliant baseload facility. The CEC furtherproposedtorequireeachPOUtofileanannualnoticeidentifyingallinvestmentsover$2.5millionthatitanticipates making during the subsequent 12 months on non‐EPS compliant baseload facilities tocomplywithenvironmentalregulatoryrequirements.Thisrequirementwouldbewaived foranyPOUthathasenteredintoabindingagreementtodivestwithinfiveyearsofallbaseloadfacilitiesexceedingtheEPS.TheCECdidnotpropose to lower theEPS.Further,by letter from theCPUC to theCEC, theCPUDexpresseditsviewthattheEPSnotbelowered.


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Note12–CommitmentsandContingencies(continued)AfinalregulatorypackagewasunanimouslyadoptedattheCEC’sJune18,2014businessmeeting.TheadoptedregulationshadlimitedchangestotheproposedPOUreportingrequirements.CECstaffhasalsosinceconfirmedthatthe$2.5millionthresholdappliestoanindividualinvestmentbyeachutility–notthecombinedinvestmentofallparticipants inaproject.ThesechangesandanyfuturechangestotheEPSregulationsmayimpactAuthoritymembers.Energy procurement and efficiency reporting – Senate Bill 1037, which was signed into law onSeptember29,2005,requiresthateachPOU,includingtheProjectParticipants,priortoprocuringnewenergy generation resources, first acquire all available energy efficiency, demand reduction, andrenewableresourcesthatarecosteffective,reliableandfeasible,thenreportannuallytoitscustomersand to the CEC its investment in energy efficiency and demand reduction programs. Each ProjectParticipanthascompliedwithsuchreportingrequirements.AssemblyBill2021,signedonSeptember29,2006,requiresthatPOUsestablish,report,andexplainthebasis of the annual energy efficiency and demand reduction targets every three years for a ten‐yearhorizonsince2007.Asubsequentbillhaschangedthe time interval forestablishingannual targets toeveryfouryears.EachoftheProjectParticipantshascompliedwiththisreportingrequirement.Assembly Bill 802, signed into law on October 8, 2015 allows savings, in conjunction with theestablishedtargetsforreduction,tobringbuildingsuptocodetocount(ratherthanonly“abovecode”savings to count) towards energy efficiency and demand reduction targets while setting newbenchmarkingrequirementsforCaliforniautilities.Pending legislation in the California State Legislature, most notably AB 1330 (Bloom), would setindividualutilityenergyefficiencyprocurementtargets.RenewablePortfolioStandard(RPS)–SenateBillX12 (SBX12), the “CaliforniaRenewableEnergyResourcesAct,”wassignedintolawonApril12,2011.SBX12codifiestheRPStargetforretailelectricitysellers to serve 33%of their loadswith eligible renewable energy resources by 2020 as provided inExecutiveOrderS‐14‐08.Asenacted,SBX12makestherequirementsoftheRPSprogramapplicabletoPOUs.ThegoverningboardsofPOUsare responsible for implementing the requirements, rather thantheCPUC, as in the case of the IOUs, and eachPOU is required to adopt and implement a renewableenergyresourcesprocurementplan.Theplanmustrequiretheutilitytoprocureaminimumquantityofelectricity product from eligible renewable energy resources, including renewable energy certificates(“RECs”),asaspecifiedpercentageoftotalkilowatthourssoldtotheutility’sretailend‐usecustomerstoachieve specific targets. Certain enforcement authoritywith respect to POUs is given to the CEC andCARBisgiventheauthoritytoimposepenalties.


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Note12–CommitmentsandContingencies(continued)SBX12grandfathers any facility approvedby thegoverningboardof aPOUprior to June1,2010 forprocurement to satisfy renewable energy procurement obligations adopted under prior law if thefacility is a “renewable electrical generation facility” as defined in the bill (subject to certainrestrictions).TheCEChasdevelopeddetailedrulestoimplementSXB12andonJune12,2013,theCECadoptedregulationsfortheenforcementoftheRPSprogramrequirementsforPOUs.In connection with the implementation of SBX1 2, the CEC is responsible for certifying the electricgenerationfacilitiesas“eligiblerenewableenergyresources”forpurposesoftheRPSprogramandhasadopted guidelines for this purpose that identifies the requirements, conditions and process forcertification of facilities as eligible renewable energy resources. These guidelines are revisedperiodically including to reflect changes in statute and market conditions and were most recentlyupdated on June 10, 2015. Certain amendments to theRPSEnforcement Procedure regulationswereapproved by the CEC on October 14, 2015 that clarify and expand certain eligibility definitions. Thecurrent guidelines identify bio‐methane as an eligible renewable energy resource. Under theseguidelinesadoptedonApril30,2013,utilities thatprocurebio‐methanewere required toreapply forcertificationofthegeneratingfacilitiesthatusebio‐methane.OnJanuary5,2015,GovernorJerryBrownproposedthreemajorclimategoalstobecompletedwithinthenext15years:1) increase33%to50%California’selectricityderivedfromrenewables;2)reducecurrentpetroleumuseincarsandtrucksbyupto50%;and3)increaseby50%theefficiencyofexistingbuildingsandmakeheatingfuelscleaner.AnumberofbillsweresubsequentlyintroducedintheStateLegislaturethat,ifadopted,would,amongotherthings,implementtheclimategoalsannouncedbytheGovernor. As expected, the proposed bills would increase the State’s Renewables Portfolio Standardfrom33%to50%(SB350(deLeon)andAB645(Williams)).TheAuthorityandtheProjectParticipantsareunabletopredicttheoutcomeorpotentialimpactsofanypossiblelegislationatthistime.CleanEnergyandPollutionReductionActof2015–SB350,theCleanEnergyandPollutionReductionActof2015,wassigned into lawonOctober7,2015.SB350,asenacted,establishesanRPStargetof50%byDecember31,2030 for theamountofelectricitygeneratedandsold toretailcustomers fromeligible renewable energy resources for retail sellers and POUs, including certain interim targets. Itrequireseachsellertoprovidearenewableenergyprocurementplanonanannualbasis,andtofileanintegrated resource plan (IRP), and a schedule for periodic updates to the plan, for approval. ThegoverningbodyofthePOUisresponsibleforadoptingtheIRP,subjecttoreviewbytheCEC,whichcanrecommendmodifications to correct any shortcomings. The CEC adopted an order instituting a newrulemakingproceedingonJanuary13,2016toimplementtheRPSandIRPprovisionsofSB350.SB 350 specifically requires the CPUC to identify a “balanced portfolio of resources” to ensure“reliability” and “optimal integration” of renewables, and requires that utilities include in theirprocurement plans a “strategy for procuring best‐fit and least cost resources” to meet the portfolioneedsthatCPUCidentifies.


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Note12–CommitmentsandContingencies(continued)SB350furtherrequirestheCECtoestablishannualtargetsforstatewideenergyefficiencysavingsanddemand reduction that will achieve a cumulative doubling of statewide energy efficiency savings inelectricityandnaturalgasfinalendusesofretailcustomersbyJanuary1,2030.TheCPUCisrequiredtoestablish energy efficiency targets for electrical and gas corporations consistent with this goal, andspecifiesprogramsthatmaybeusedtoachievethegoal.POUsarerequiredtoestablishannualtargetsforenergyefficiencysavingsanddemandreductionconsistentwiththegoalandtoreportthosetargetstotheCECeveryfouryearsforthenext10‐yearperiod.Thebillprovidesguidanceastowhatmeasuresqualifyandrequiresanevaluationoffeasibilityandcosteffectivenessinsettingannualtargetsforthosesavings.SB350alsorequirestheCECtoadoptaresponsiblecontractorpolicyandestablishconsumerprotectionguidelines.SB350requirestheISOtoprepareproposedgovernancemodificationstofacilitatethetransformationof the ISO into a regional organizationbutprovides that such governancemodificationswill not takeeffectpriortocompletionofaspecifiedprocessforreviewandstudyoftheimpactsofaregionalmarketand the enactment by the Legislature of future legislation implementing the proposed governancechangesby2019.Solarpower–SenateBill1(alsoknownastheCaliforniaSolarInitiative),whichwassignedintolawonAugust21,2006, requiresPOUs, including theProjectParticipants, to establishaprogramsupportingthestatedgoalofthelegislationtoinstall3,000MWofphotovoltaicenergyinCalifornia.POUsarealsorequired to establish eligibility criteria in collaborationwith the CEC for the funding of solar energysystemsreceivingratepayer‐fundedincentives.Certainreportingrequirementsalsohavetobemetbythe POUs. Each of the Project Participants has established programs in accordance with therequirementsoftheCaliforniaSolarInitiative.The electric industry is subject to continuing legislative and administrative reforms. States routinelyconsiderchangestothewaytheyregulatetheelectric industry.Historically,bothfurtherderegulationandformsofadditionalregulationhavebeenproposedfortheindustry,whichhasbeenhighlyregulatedthroughout its history. While there is no current proposal to further the industry, there still areadditional regulations or legislativemandates being proposed or considered for the industry such ashigher relianceon renewable energy and tighter regulations for greenhouse gas emission reductions.The Authority and the Project Participants are unable to predict at this time the impact any suchproposals will have on the operations and finances of the Project Participant’s electric utility or theelectricutilityindustrygenerallyTheeffectofthesedevelopmentsintheCaliforniaenergymarketsontheProjectParticipantscannotbefullyascertainedatthistime.Also,volatilityinenergypriceinCaliforniamayreturnduetoavarietyoffactorswhichaffectboththesupplyanddemandforelectricenergyinthewesternUnitedStates.


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Note12–CommitmentsandContingencies(continued)This price volatility may contribute to greater volatility in the revenues of their respective electricsystems from the sale (and purchase) of electric energy and, therefore, could materially affect eachProject Participant’s financial condition. Each Project Participant undertakes resource planning, riskmanagement activities, and manages its resource portfolio to mitigate such price volatility and spotmarketrateexposure.Federal Policy on Cybersecurity – Executive Order “Improving Critical Infrastructure Security” wasissued on February 13, 2013. Among other things, the Executive Order calls for improved informationsharingandprocessingofsecurityclearancesforownersandoperatorsofcriticalinfrastructures.Italsorequiredthedevelopmentofaframework(“Framework”),ledbytheNationalinstituteofStandardsandTechnology),toreducecyberriskstocriticalinfrastructure.TheExecutiveOrdercouldresultinsubstantivechangestopolicy,regulatory,andcomplianceissuesthatwillaffect theelectric industry.TheAuthorityand theProjectParticipantswillcontinue tomonitor thisissueinordertohelpensurethattheFrameworkcontinuestorecognizetheexistingcybersecurityeffortsintheelectricsector,anddoesnotunderminethembycreatingduplicativeorinconsistentprocesses.The“CybersecurityInformationSharingActof2015”wassignedintolawonDecember18,2015.Itcreatesan industry‐supported, voluntary cybersecurity information sharing program that will encourage bothpublicandprivatesectorentitiestosharecyber‐relatedthreatinformation.Federalenergylegislation–UnderthefederalEnergyPolicyActof2005(EPAct2005),FERCwasgivenrefundauthorityovermunicipalutilitiesiftheysellintoshort‐termmarkets,liketheISOmarkets,andselleightmillionMWhsormoreofelectricenergyonanannualbasis.Inaddition,FERCwasgivenauthorityover the behavior of market participants, where it can impose penalties on any seller for using amanipulativeordeceptivedevice,includingmarketmanipulation,inconnectionwiththepurchaseorsaleof energy or transmission service. The EPAct 2005 authorized FERC to issue permits to construct ormodify transmission facilities located in a national interest electric transmission corridor if FERCdeterminesthatthestatutoryconditionsaremet.EPAct2005requiresthecreationofanelectricreliabilityorganization(ERO)toestablishandenforce,underFERCsupervision,mandatoryreliabilitystandardstoincrease system reliability andminimize blackouts. Failure to comply with such mandatory standardsexposesautilitytosignificantfinesandpenaltiesbytheERO.NERCReliabilityStandards–EPAct2005requiredFERCtocertifyanEROtodevelopmandatoryandenforceable reliability standards, subject to FERC review and approval. On February 3, 2006, FERCissued Order 672,which certified the North American Electric Reliability Corporation (NERC) as theERO.ManyreliabilitystandardshavesincebeenapprovedbyFERC.Suchstandardspertainnotonlytothe planning, operations, andmaintenance of Bulk‐Power System facilities, but also to the cyber andphysicalsecurityofcertaincriticalfacilities.


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Note12–CommitmentsandContingencies(continued)FERC Order 693 further provided ERO and Regional Entities (entities to which NERC has delegatedenforcement authority through an agreement approved by FERC) with the discretion to calculate apenaltywithoutcollectingthepenaltyifcircumstanceswarrant.Federalregulationoftransmissionaccess–EPAct2005authorizesFERCtocompel“openaccess”tothetransmissionsystemsofcertainutilitiesthatarenotgenerallyregulatedbyFERC, includingmunicipalutilities if the utility sellsmore than fourmillionMWhs of electricity per year. Under open access, atransmissionprovidermustallowallcustomerstousethesystemunderstandardizedrates,termsandconditionsofservice.Other legislation–Congress has considered and is considering numerous bills addressing domesticenergy policies and various environmental matters, including bills relating to energy supplies anddevelopment (such as a federal energy efficiency standard and expedited permitting for natural gasdrillingprojects),globalwarming,andwaterquality.Manyofthesebills,ifenactedintolaw,couldhaveamaterialimpactontheAuthority,theProjectParticipants,andtheelectricutilityindustryingeneral.TheAuthorityandtheProjectParticipantsareunabletopredicttheoutcomeorpotentialimpactsofanypossiblelegislationatthistime.Environmental issues–Electricutilitiesaresubject tocontinuingenvironmentalregulation.Federal,stateand localstandardsandprocedureswhichregulatetheenvironmental impactofelectricutilitiesaresubjecttochange.ThereisnoassurancethatanyAuthorityorProjectParticipantfacilityorprojectwill remain subject to the laws and regulations currently in effect,will alwaysbe in compliancewithfuture laws and regulations, or will always be able to obtain all required operating permits. TheAuthorityisunabletopredicttheoutcomeoftheselegalandlegislativechallengesatthistime.GreenhouseGasRegulationsUndertheCleanAirAct–TheUnitedStatesEnvironmentalProtectionAgency(the“EPA”)hastakenstepstoregulategreenhousegasemissionsunderexisting law.In2009,theEPAissuedafinal“endangermentfinding,”inwhichitdeclaredthattheweightofscientificevidencerequiresafindingthatsixidentifiedgreenhousegases,namely,carbondioxide,methane,nitrousoxide,hydrofluorocarbons,perfluorocarbons, and sulfurhexafluoride, causeglobalwarming, and that globalwarming endangers public health and welfare. The final rule for the “endangerment finding” waspublishedintheFederalRegisteronDecember15,2009.Asaresultofthisfinding,theEPAconsidereditwas authorized to issue regulations limiting carbon dioxide emissions from, among other things,stationarysourcessuchaselectricgeneratingfacilities,underthefederalCleanAirAct.The “Tailoring Rule,” published in the Federal Register on June 3, 2010, states that greenhouse gasemissionswillberegulatedfromlargestationarysources, includingelectricgeneratingfacilities, ifthesourcesemitmorethanthespecifiedthresholdlevelsoftonsperyearofcarbondioxide.


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Note12–CommitmentsandContingencies(continued)Large sources,with the potential to emit in excess of the applicable threshold,will be subject to themajor source permitting requirements under the Clean Air Act, including the EPS’s Prevention ofSignificantDeterioration(“PSD”)anditsTitleVoperatingpermitprogram.Permitswouldberequiredinordertoconstruct,modify,andoperatefacilitiesexceedingtheemissionsthreshold.Theendangermentfindingand theTailoringRulehavebeenchallenged in court,butwereupheldon June26,2012.Theappealedpetition for rehearingwasdeniedonDecember2012. InOctober2013 severalpetitions forreview relating to these findings were consolidated in a United States Supreme Court case and onJune23, 2014 the Court issued its decision on the US EPA’s Tailoring Rule. The decision invalidatedsubstantial portions of the Tailoring Rule, governing when PSD and Title V permitting would betriggered,while preserving various aspects of the EPA’s ability to regulate greenhouse gas emissionsfrommostmajornewsources.Pursuant to a December 23, 2010 settlement agreement, the EPA proposed on April 13, 2012 toestablishNew Source Performance Standards limiting carbon dioxide emissions from fossil‐fuel firedelectricgeneratingunits.InresponsetoaJune25,2013PresidentialMemorandum,theEPArescindedthe April 13, 2012 proposal and re‐proposed standards that they stated would apply only to newfacilities,notreconstructedormodifiedfacilities.TheEPAisrequiredbythePresidentialMemorandumto propose by June 1, 2014, and finalize by June 1, 2015, standards, regulations, or guidelines thataddresscarbonpollutionfrommodified,reconstructedandexistingpowerplants.On June2, 2014, theEPA released its “CleanPowerPlan” proposal for both existing andmodifiedorreconstructed power plants as contemplated by a Presidential Memorandum. The proposed rule isdesignedtoreducecarbon(CO2)emissions fromthepowersectorby30%onaveragenationwideby2030,ascomparedto2012levels.Undertheproposal,theEPAwillsetdifferentinterim(2024)andfinal(2030)emissions targets foreachstatebasedonoverallCO2emissionsand theamountofelectricitygeneratedinthestate.Itwasproposedthatstateemissiontargetsmaybemetinacombinationofways,including through a “Best System of Emissions Reduction,” which may include coal plant efficiencyupgrades, switching from coal to natural gas, and by improving energy efficiency or promotingrenewableenergy.Intheeventastatefailstodevelopasatisfactoryimplementationplan,theEPAmayimposeafederalimplementationplaninstead.OnAugust 3, 2015, the EPA announced the final version of the Clean Power Plan for existing powerplants, effective December 22, 2015. The EPA further released its final new source performancestandards for emissions of carbon dioxide for newly constructed,modified, and reconstructed powerplantseffectiveOctober23,2015.


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Note12–CommitmentsandContingencies(continued)A number of lawsuits have been filed challenging final rules and seeking to prevent the EPA frommoving forward to implement the Clean Power Plan. The Authority and the Project Participants areunable topredict theoutcomeof thesechallenges to theEPA’sendangerment findingandsubsequentrulemaking or the effect that any final rules promulgated by the EPA regulating greenhouse gasemissions from electric generating units and other stationary sourceswould have on the Authority’sprojectsortheProjectParticipantsandtheirrespectiveelectricsystems.NationalAmbientAirQualityStandards–TheCleanAirActrequiresthattheEPAestablishNationalAmbientAirQualityStandards(NAAQS)forcertainairpollutants.OnceNAAQShavebeenestablished,eachstatemustidentifyareasthatdonotmeettheEPAstandard(“non‐attainmentareas”)anddevelopregulatory measures in its state implementation plan to reduce or control the emissions of that airpollutantinordertomeettheapplicablestandardandbecomean“attainmentarea”.AproposaltolowertheNAAQSforozonewassubmittedandwithdrawnandtheEPAresumedtheprocessof issuingnon‐attainmentdesignationsfortheozoneNAAQSunderthestandardsetin2008.Thesedevelopmentsmayresult instringentpermittingprocesses fornewsourcesofemissionsandadditionalstaterestrictionson existing sources of emissions. OnMay 29, 2013, the EPA proposed a rule to implement the 2008ozoneNAAQandsolicitedpubliccommentsontheproposal.OnOctober,2015,theEPAissueditsfinalrule, lowering theozone standard to70partsperbillion.The final rulewaspublished in theFederalRegisteronOctober6,2015andbecameeffectiveonDecember28,2015.Legal challengeshavebeenfiledbyseveralstatesandindustrygroups.Mercury and Air Toxic Standards (“MATS”) – On December 16, 2011, the EPA signed a ruleestablishingnewstandardstoreduceairpollutionfromcoal‐andoil‐firedpowerplantsundersections111 (new source performance standards) and 112 (toxics program) of the Clean Air Act. The EPAupdatedtheMATSemissionlimitsonNovember30,2012andagainonMarch28,2013andiscurrentlyreconsidering certain aspects of the regulation. Power plants have up to four years to meet thesestandards.Whilemanyplantsmeetsomeorallofthesenewstandards,someplantswillberequiredtoinstallnewequipmenttomeet thestandards.TheSupremeCourthassinceremandedtherulemakingback to a lower court because the EPA misinterpreted Clean Air Act Section 112 when it failed toconsidercompliancecostsinregulatingmercuryfrompowerplants.TheEPAissuedafinalfindingonApril 14, 2016. The Project Participants purchase power from coal‐fired power stations thatmay beaffectedbythesenewrules,andmaybeexposedtoincreasedcosts.Otherproposals–TheEPAreleaseditsfinalrulerelatingtotheCoalCombustionResiduals(CCR)suchasashonDecember19,2014,adoptingtheindustry‐preferredalternativeregulationclassifyingCCRsasnonhazardoussolidwaste.Thedefinitionof“CCRlandfill”nowincludes“coal”(soothernon‐coalminesthat receive utility coal ash may qualify as CCR landfills), and clarifies that when groundwatercontamination from an unlined CCR surface impoundment exceeds an applicablewater standard, theowner/operatormaychoosetoretrofittheunitinsteadofclosingit.Congressisconsideringlegislationthatwouldmakefurtherrefinementstotherule.


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Note12–CommitmentsandContingencies(continued)OnMay 16, 2014, the EPA released a final regulation on CoolingWater Intake Structures at certainexistingpowerplants.Theregulationwasestablishedinordertoreducethenumberoffishandotheraquatic organisms that are trapped against intake screens or drawn into the generating unit; theregulation became effective on October 14, 2014 and is expected to increase the cost of power theProjectParticipantspurchasefromcertainfossilfuel‐firedunits.On June 7, 2012, the EPA proposed setting technology‐based effluent limitations guidelines andstandardsformetalsandotherpollutantsinwastewaterdischargedfromsteamelectricpowerplants.TheEPAIalsoconsideringbestmanagementpracticesforsurfaceimpoundmentscontainingCCRs.OnSeptember30,2015,theEPAannounceditsfinalSteamElectricEffluentLimitationGuidelinestoupdatethefederallimitsontoxicmetalsindischargewastewater.TheEPAwillprovidetheindustrymoretimetocoordinatecompliancewiththisandthecoalashrule.Otherfactors–Theelectricutilityindustryingeneralhasbeen,orinthefuturemaybe,affectedbyanumberofotherfactorswhichcouldimpactthefinancialconditionandcompetitivenessofmanyelectricutilitiesandthelevelofutilizationofgeneratingandtransmissionfacilities.Suchfactors,includingthosediscussedabove,couldhaveanadverseeffectonthefinancialconditionofanygivenelectricutilityandlikelywillaffectindividualutilitiesindifferentways.TheAuthority isunable topredictwhat impactsuch factorswillhaveon thebusinessoperationsandfinancial condition of itsmembers but the impact could be significant. Extensive information on theelectricutilityindustryisavailablefromthelegislativeandregulatorybodiesandothersourcesinthepublicdomain.Nuclearspentfuelandwastedisposal–UndertheNuclearWastePolicyAct,theDepartmentofEnergy(DOE)wastodevelopthefacilitiesnecessaryforthestorageanddisposalofspentfuelandtohavethefirstsuch facility inoperationby1998.DOEcollecteda feeof0.1 cents/kwhofelectric generation from thenuclearplantoperatorstofundthedevelopmentandoperationofthedisposalfacility.InJuly2002,ameasurewassignedintolawdesignatingtheYuccaMountain,inthestateofNevada,asthenation’shigh‐levelnuclearwasterepository.ThismeantthattheDOEcouldthenfileaconstructionandoperationplan for theYuccaMountainwith theNuclearRegulatoryCommission (NRC).Due to aseriesofsetbacksincludingscientificchallengesbytheNationalAcademyofScience,falsifiedresearchdatabyconsultants,anddelaysinsubmittingtheconstructionapplicationtotheNRC,theoperationdateoftherepositorywaspushedbackseveraltimes.InJune2008,theDOEsubmittedtotheNRCalicenseapplicationtoconstructtherepository.In2009,thefederalgovernment,underthenewadministration,decidedtocutoffalltheappropriatedfundsforthedevelopmentoftherepositoryattheYuccaMountain,attheurgingoftheCongress,exceptasmallbudgetallocationfortheclosingoftheproject.


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Note12–CommitmentsandContingencies(continued)The DOE subsequently submitted a request to the NRC to withdraw the license application. ThewithdrawalrequestwasdeniedbytheNRCduetoalackofvalidreasons.Concurrently,anindependentcommissionwas formed by the DOE to find a solution for the nuclear waste disposition that wouldinclude YuccaMountain among the different options. There are questions among utilities, aswell aspublicutilitycommissionsnationwide,aboutthecontinuedcollectionofdisposalfeesbytheDOEfortheNuclear Waste Fund recognizing that there is a lack of spent fuel disposal policy from the federalgovernment. After further contest by the Public Utility Commissions of several states as well as thenuclearoperators, theDOEsuspended the collectionof the0.1cents/kwhnuclearwaste feeeffectiveMay16,2014.ThePaloVerdeOperatingAgent,onbehalfoftheco‐owners,haslitigatedtheDOEtorecoverthecostsofstoringspentfuelatPaloVerdebecausetheDOEfailedtohonorthecontracttoremoveanddisposeofspent fuel as scheduled. In 2010, the federal court ruled in favor of Palo Verde and granted acompensationof$30.2millionwhichcoveredcosts incurredup to2006.TheAuthority’s shareof thesettlementwas$1.8million.PaloVerdecontinuestopursuecostrecoverythroughtheDOEasadditionalspent fuel related expenses are accumulated for the continued operation of the plant. In 2012, PaloVerdefiledaclaimof$59millionforcostsassociatedwiththestorageofspentfuelattheplantsitefortheperiod2007‐2011.SettlementwasreachedwiththeDOEfor$57.4millionofwhichtheAuthority’sshareis$3.4million.InJune2015,theAuthorityreceivedapaymentintheamountof$2.5millionforitsshareofthesettlementwiththeDOE.Atpresent,theDOEsubmitspaymentsonaquarterlybasis,whichisappliedtotheannualnuclearfuelbudget.ThespentfuelstorageinthewetpoolatPaloVerdeexhausteditscapacityin2003.ADryCaskStorageFacility(theFacility),alsocalledtheIndependentSpentFuelStorageInstallation(ISFSI),wasbuiltandcompletedin2003atatotalcostof$33.9million(about$2millionfortheAuthority).InadditiontotheFacility, the costs also include heavy lift equipment inside the units and at the yard, railroad track,tractors, transporter, transport canister, and surveillance equipment. The Facility has the capacity tostore all the spent fuel generated by the Palo Verde plant until 2027. To date, over 138 casks, eachcontaining24spentfuelassemblieswereplacedintheFacility.Theoriginalplancalledfortheannualtransferofabout240fuelassembliesfromthewetpooltotheFacility.IntheaftermathofthenuclearincidentatFukushimaDaiichiNuclearStationinJapan,followingthestrongearthquakeandsubsequenttsunamiin2011,PaloVerdedecidedtoaccelerateitscampaigntotransferspentfuelfromthespentfuelpooltotheFacilitytorelievethecongestionwithinthepool.Beginningin2018,PVNGSisexpectedtousethenewlydesigned“Magnastor”casksthatcontain36spentfuelassembliesallowingthedrycaskstoragefacilitytoacceptmorespentfuel.Thenewcaskdesigniscurrentlyinfabrication.Storingspentfuel at Palo Verde is now considered indefinitewith undetermined costs until spent fuel is removedfromtheplantsite.


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Note12–CommitmentsandContingencies(continued)TheSenateEnergyandNaturalResourcesCommittee iscurrentlyconsideringbipartisanlegislationtoaddress both interim and long‐term spent fuel storage. The bill sponsors include California’s SenatorDianneFeinstein.Nuclearinsurance–ThePrice‐AndersonAct(theAct)requiresthatallutilitieswithnucleargeneratingfacilities share in the payment for liability claims resulting from a nuclear incident. The Act limitsliability from third‐party claims to approximately $13.4 billion per incident. Participants in the PaloVerde Nuclear Generating Station (PVNGS) currently insure potential claims and liability throughcommercialinsurancewitha$375millionlimit;theremainderofthepotentialliabilityiscoveredbytheindustry‐wide retrospective assessment program provided under the Act. This program limitsassessments to$127.3millionperoperating reactor foreach licensee (thereareabout102operatingreactors in the U.S.) for each nuclear incident occurring at any nuclear reactor in the United States;payments under the program are limited to $26.2 million per reactor, per incident, per year to beindexed for inflation every five years. Based on the Authority’s 5.91% interest in Palo Verde, theAuthoritywouldbe responsible foramaximumassessmentof $22.6millionper incident forall threeunits,limitedtopaymentsof$4.5millionperincident,peryear.In addition to the above, the Authority may be subject to retroactive insurance assessments for itsparticipationintheNeilPropertyInsuranceProgramintheamountof$2.5million.Other commitments – The major capital projects that are currently in progress include the cybersecurityupgrade,digitalupgradeoftheGenerrexgeneratorexcitationsystem,thelifeextensionoftheWaterReclamationFacility’sclarifiers,thespraypondconcretereplacement,theNuclearAdministrativeandTechnicalManualreplacement,andtheconstructionof theLearningCenter‐InProcessing facility.These,alongwithotherregulatoryplantmodifications,arecurrentlyestimatedat$235millionwhichtranslatestoapproximately$13.9millionfortheAuthority.Alsoanticipatedinthelong‐rangeplanare$224million($13.2millionfortheAuthority)worthofcapitalprojectswhichincludethecoolingtowerlife extension long‐range plan, upgrades to thehigh‐pressure turbines and electro‐hydraulic controls,the replacement of the reactor coolant pumps, Control Element Drive Mechanism Control System(CEDMCS),plantcoolingwaterpipelines,andtheSiteWorkManagementSystem(SWMS).


122

Note12–CommitmentsandContingencies(continued)In response to thenuclearevent inFukushima, Japan, theNRChasrequiredPVNGS to implement thefollowing: increase the redundancy in its power supply to emergency cooling systems, reinforce itsspentfuelpool,acceleratethetransferofspentfuelfromthepooltothedrycaskstorage,addpipelinesandassociatedequipmentnecessaryforsupplyingadditionalcoolingwatertothereactors,andupgradethe communication and control system to allow remote access to the plant. To date, the station haspurchasedadditionaldieselgenerators,pumps,hoses,firetrucksandstagesattheplantsite.Italsohasaccess to other emergency equipment stored by the nuclear industry in two facilities in Memphis,TennesseeandPhoenix,Arizona.Inadditiontothese,PaloVerdehasallottedapproximately$82million(approximately $4.8 million for the Authority) for Fukushima initiatives which include fuel buildingmodifications, an emergency equipment storage facility, temporary power connections, seismic andfloodhazardsvalidation,andcorrespondingmitigatingstrategies,amongseveralothers.AllFukushimaupgrade‐related activities are expected to be implemented by the end of 2016. Additional NRC‐mandatedrequirementsareanticipatedbutthecostsassociatedwiththesefutureprojectsareunknownatthistime.Asa resultof, amongother things, theanticipatedcostsofenvironmental complianceatSJGSand theCalifornialawsthatmaylimittheabilityofSCPPAtoenterintocertainlifeextensionprojectsforcoal‐firedpowerplants,includingSJGS,theauthorityandotherSJGSownersentereddiscussionswithrespectto the restructuringof their respective rights andobligations in theProject.Aproposal including theshutdownofUnits2and3byDecember2017andtheCaliforniaownerspossiblyexitingtheprojectwasfinallyapprovedbytheEPAonOctober9,2014andtheEPArulebecameeffectiveNovember10,2014.TheownerscontinuedtomeettonegotiatetermstoallowtheCaliforniaownerstoexittheprojectandafter extensive mediated negotiations, five related agreements were reached that restructured theownershipof theSan JuanProject andaddressedother related issues.Although regulatoryapprovalswith respect to the transfer of ownership have been obtained, certain appeal proceedings filed bypartiesopposedtotherestructuringremainongoing.Noassurancescanbegiventhatsuchownershiprestructuring will be completed. Further, the Authority cannot reasonably estimate what itsdecommissioningobligationmaybeforitsownershipinterestinSJGSUnit3,orwhetherdepositsmadeintoareclamationtrustaccountwillcoverallcostsofitsreclamationobligations.Other legal matters – Claims and a lawsuit for damages have been filed with the Authority,IntermountainPowerAuthority(theIPA),andLADWPseekinginexcessof$500millionindamages.Theclaimantsallege, amongother things, thatdue to impropergroundingof the transmission lineofSTS,their dairy herdswere damaged and the value of their landwas diminished. The Authority believedthese claimswere substantiallywithoutmerit as to itself because theAuthorityhasno ownershiporoperational control over the subject transmission lines, andmerely acted as a financing agencywithrespecttoSTS.Phase1ofthetrial, limitedtotheownersofsixdairies,beganonSeptember30,2013,butafter20trialdaysendedinamistrial.Theplaintiffsthenfiledamotionforachangeofvenue,whichthetrialcourtdenied.PlaintiffsappealedthatrulingtotheUtahCourtofAppealsandtheUtahSupremeCourt,bothofwhichaffirmedthetrialcourt’sdecision.


123

Note12–CommitmentsandContingencies(continued)Thecaseisbackinthetrialcourt,whichhassetanewtrialdateforMarch13,2017.Nodeterminationcanbemadeatthistimewhetheranunfavorableoutcomeisprobableorremote,norcananaccurateestimatebemadeoftherangeofpotentialloss.TheAuthorityisalsoinvolvedinvariousotherlegalactions.Intheopinionofmanagement,theoutcomeof such litigation or claimswill not have amaterial effect on the financial position or the results ofoperationsoftheAuthorityortherespectiveseparateProjects.Note13–SubsequentEventsSpringbok1SolarFarmProject – OnAugust 21, 2014, SCPPA on behalf of LADWP, entered into apower purchase agreement with 8minuteenergy for 100 MW of solar energy with all associatedenvironmentalattributes,andphotovoltaicgeneratingcapacityfromtheSpringbok1SolarFarmlocatedin western Kern County, California. The commercial operation date is currently expected to be inSeptember2016,startingatermof25years.SCPPAhasanEarlyBuyOutoptionattheendofthe15th,20th, and 25th Contract Years. The project is expected to have ameasured initial generation capacityfactorupto34%witha0.7%annualdegradation.LADWPservesas theProjectManageronbehalfofSCPPA.Astoria2SolarProject–On July 23, 2014, SCPPA on behalf of Azusa, Banning, Colton andVernon,entered intoapowerpurchaseagreementwithRecurrentEnergy for solarenergy from theAstoria2Solar Project. SCPPA is entitled to 35 MW of photovoltaic generating capacity from commercialoperation to December 31, 2021 and 45 MW of generating capacity from January 1, 2022 until theexpectedexpirationdateofDecember31,2036.Commercialoperationiscurrentlyexpectedtobegininlate August 2016. Power and Water Resources Pooling Authority, Lodi, Corona, Moreno Valley, andRanchoCucamonga,areeachbuyingtheoutputofaseparateportionofthefacility,whichislocatedinKernCounty, California. SCPPAhas purchase options in the10th, 15th, and20thContract Years. Theproject is forecastedtostartatacapacityfactorof31%witha0.5%annualdegradation.ACESPowerMarketingistheSchedulingCoordinatorfortheProject,SummerSolarProject –OnNovember15,2012,SCPPAonbehalfofAzusa,PasadenaandRiverside,enteredintoapowerpurchaseagreementwithSustainablePowerGroup(“sPower”)for20MWofsolarphotovoltaicgeneratingcapacityfromtheSummerSolarFacilityforatermof25yearsfromJanuary1,2017. The facility is located in Lancaster, California, andwas commercial in July 2016. Theproject isforecasted to start at a capacity factorof28%witha0.5%annualdegradation. SCPPAdoesnothavepurchaseoptionsonthisproject.RiversideservesastheSchedulingCoordinatorfortheproject.


124

Note13–SubsequentEvents(continued)Springbok2SolarFarmProject – OnAugust 28, 2015, SCPPA on behalf of LADWP, entered into apowerpurchaseagreementwith8minuteenergyfor150MWofsolarphotovoltaicgeneratingcapacityfromtheSpringbok2SolarFarmlocated70milesnorthofLosAngelesinKernCounty,California.ThecommercialoperationdateiscurrentlyexpectedtobeinSeptember2016,startingatermof27years,withanoptionforathree‐yearextension.SCPPAhasanEarlyBuyOutoptionattheendofthe15th,20th,27th,and30thContractYears.Theproject isexpected tostartatacapacity factorof33%witha0.7%annualdegradation.LADWPservesastheProjectManageronbehalfofSCPPA.AntelopeBigSkyRanchSolarProject–OnNovember15,2012,SCPPAonbehalfofAzusa,PasadenaandRiverside,enteredintoapowerpurchaseagreementwithsPowerfor20MWofsolarphotovoltaicgenerating capacity from the Antelope Big Sky Ranch Facility. The facility is located near Lancaster,California,andcommercialoperationoccurredinlateAugust2016foratermof25yearsfromJanuary1,2017.Theproject is expected to start at a capacity factorof28%witha0.5%annualdegradation.SCPPA has purchase options in the 10th, 15th, and 20th Contract Years. Pasadena is the SchedulingCoordinatorfortheproject.Project Stabilization Fund – On August 18, 2016, the SCPPA Board of Directors amended andsupersededtheresolutionthatestablishedtheProjectStabilizationFundin1996inordertosimplifytheprocessforwithdrawingfundsandeliminateprovisionsthathavebeenfoundunnecessaryoverthe20yearsthatthePSFhasbeeninexistence.

REQUIREDSUPPLEMENTARYINFORMATION

125

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYSCHEDULEOFPROPORTIONATESHAREOFTHENETPENSIONLIABILITY

ASOFJUNE30,2016LASTTENYEARS*

2016 2015

Proportionofthenetpensionliability 0.03604% 0.01404%

Proportionateshareofthenetpensionliability 1,010,974$ 873,857$

Covered‐employeepayroll 2,258,941$ 1,091,557$

ProportionateShareofthenetpensionliabilityaspercentageofcovered‐employeepayroll 44.75% 80.06%

Plan'sfiduciarynetposition 24,907,306$ 24,940,528$

Planfiduciarynetpositionasapercentageofthetotalpensionliability 78.32% 81.00%

NotestoScheduleChangesinassumptions–In2016,GASB68wasmodifiedtostatethatthelong‐termexpectedrateofreturnshouldbedeterminednetofpensionplaninvestmentexpensebutwithoutreductionforpensionplanadministrativeexpense.Thediscountratewaschanged from7.50percent (netofadministrativeexpensein2014)to7.65percentasofJune30,2015measurementdatetocorrecttheadjustmentwhichpreviouslyreducedthediscountrateforadministrativeexpense.*Fiscalyear2015wasthe1styearofimplementation,thereforeonlytwoyearsareshown.

126

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYSCHEDULEOFCONTRIBUTIONSASOFJUNE30,2016LASTTENYEARS*

2016 2015

Contractuallyrequiredcontribution(actuariallydetermined) 265,844$ 699,279$

Contributionsinrelationtotheactuariallydeterminedcontribution (278,896) (699,279)

Contributiondeficiency(excess) (13,052)$ ‐$

Covered‐employeepayroll 2,258,941$ 1,091,557$

Contributionsasapercentageofcovered‐employeepayroll 11.77% 64.06%

NotestoSchedule

Valuationdate: 6/30/2014 6/30/2013

Methodsandassumptionsusedtodeterminecontributionrates:

SingleandAgentEmployersExample EntryageAmortizationmethod Levelpercentageofpayroll,closedRemainingamortizationperiod 15yearsAssetvaluationmethod 5‐yearsmoothedmarketInflation 3.50%Salaryincreases 4.5%,average,includinginflationof3.0%

Investmentrateofreturn 7.5%,netofpensionplaninvestmentexpense,includinginflation

Retirementage 57yrs.Mortality RP‐2000HealthyAnnuitantMortalityTable

*Fiscalyear2015wasthe1styearofimplementation,thereforeonlytwoyearsareshown.

SUPPLEMENTALINFORMATION

127

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYPALOVERDEPROJECT

SUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016


DebtServiceFund

DecommissioningTrustFund

EscrowAccount

GeneralReserveAccount

IssueAccount

OperatingAccount

Reserve&Contingency

RevenueFund Total

BalanceatJune30,2015 ‐$ 172,399$ 144,771$ 1,305$ 13,309$ 43,740$ 16,629$ ‐$ 392,153$

AdditionsInvestmentearnings ‐ 2,099 35,829 13 1 677 131 1 38,751Discountoninvestmentpurchases ‐ 24 ‐ ‐ 21 15 4 ‐ 64Distributionofinvestmentearnings ‐ ‐ ‐ (13) (22) (125) (135) 295 ‐Revenuefrompowersales ‐ ‐ ‐ ‐ ‐ ‐ ‐ 77,166 77,166Distributionofrevenue ‐ ‐ ‐ ‐ 12,150 50,745 14,567 (77,462) ‐Otherreceipts ‐ ‐ ‐ ‐ ‐ 704 ‐ ‐ 704Transferfromescrow 27,145 ‐ (44,529) ‐ 17,384 ‐ ‐ ‐ ‐

Totaladditions 27,145 2,123 (8,700) ‐ 29,534 52,016 14,567 ‐ 116,685

DeductionsConstructionexpenditures ‐ ‐ ‐ ‐ ‐ ‐ 13,844 ‐ 13,844Operatingexpenditures ‐ 3 ‐ ‐ ‐ 42,685 ‐ ‐ 42,688Fuelcosts ‐ ‐ ‐ ‐ ‐ 15,877 ‐ ‐ 15,877Paymentofprincipal ‐ ‐ ‐ ‐ 11,690 ‐ ‐ ‐ 11,690Interestpaid‐non‐escrow ‐ ‐ ‐ ‐ 118 ‐ ‐ ‐ 118Paymentofprincipalandinterest–escrow 27,145 ‐ ‐ ‐ 17,383 ‐ ‐ ‐ 44,528

Totaldeductions 27,145 3 ‐ ‐ 29,191 58,562 13,844 ‐ 128,745

BalanceatJune30,2016 ‐$ 174,519$ 136,071$ 1,305$ 13,652$ 37,194$ 17,352$ ‐$ 380,093$

This schedule summarizes the receipts and disbursements in funds required under the Bond Indenture and has been prepared from the truststatements. The balances in the funds consist of cash and investments at original cost. These balances do not include accrued interest receivable,unrealizedgain(loss)oninvestments,or$45and$24heldintherevolvingfundatJune30,2016and2015,respectively.

128

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYSANJUANPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)

DebtServiceFund

DebtServiceReserveAccount RevenueFund

OperatingFund

Reserve&Contingency

Fund

MineReclamation

Fund Total

BalanceatJune30,2015 10,764$ 25$ ‐$ 5,894$ 13,380$ 2,883$ 32,946$

AdditionsInvestmentearnings 12 ‐ 1 7 39 22 81Discountoninvestments 7 ‐ ‐ 2 6 6 21Distributionofinvestmentearnings (19) ‐ 73 (8) (46) ‐ ‐Revenuefrompowersales ‐ ‐ 87,660 ‐ ‐ ‐ 87,660Distributionofrevenues 21,680 ‐ (87,734) 64,854 1,200 ‐ ‐Other ‐ ‐ ‐ 8,774 (3,760) 3,760 8,774

Totaladditions 21,680 ‐ ‐ 73,629 (2,561) 3,788 96,536

DeductionsOperatingexpenses ‐ ‐ ‐ 56,648 (63) ‐ 56,585Constructionexpenses ‐ ‐ ‐ ‐ 649 ‐ 649Paymentofprincipal 21,590 ‐ ‐ ‐ ‐ ‐ 21,590Interestpaid 350 ‐ ‐ ‐ ‐ ‐ 350

Totaldeductions 21,940 ‐ ‐ 56,648 586 ‐ 79,174

BalanceatJune30,2016 10,504$ 25$ ‐$ 22,875$ 10,233$ 6,671$ 50,308$

This schedule summarizes the receipts and disbursements in funds required under the Bond Indenture and has been prepared from the truststatements. The balances in the funds consist of cash and investments at original cost. These balances do not include accrued interest receivable,unrealizedgain(loss)oninvestmentsor$60and$18heldintherevolvingfundatJune30,2016and2015,respectively.

129

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYMAGNOLIAPOWERPROJECT



DebtServiceAccount

DebtServiceReserveAccount

ProjectFund

OperatingReserveFund

Reserve&Contingency

OperatingFund

RevenueFund

GeneralReserveFund

EscrowFund

FuelReserveFund

GHGReserveFund Total

BalanceatJune30,2015 15,634$ 28,824$ ‐$ 4,927$ 22,081$ 7,902$ ‐$ 90$ ‐$ 7,310$ 2,897$ 89,665$

AdditionsInvestmentearnings 7 492 ‐ 41 69 4 6 ‐ ‐ 27 9 655Discountoninvestmentpurchases 3 15 ‐ ‐ 22 1 ‐ ‐ ‐ 3 1 45Distributionofinvestmentearnings (11) (503) ‐ (26) (92) (5) 637 ‐ ‐ ‐ ‐ ‐Transferoffundsfordebtservice ‐

payment ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Receiptfromparticipants ‐ ‐ ‐ ‐ ‐ ‐ 53,406 ‐ ‐ ‐ ‐ 53,406Distributionofrevenues 18,613 (1) ‐ ‐ 15,887 15,647 (54,049) ‐ ‐ 3,903 ‐ ‐Other 3,863 (3,863) ‐ (9,100) (2,892) 17,144 ‐ ‐ ‐ (5,152) ‐ ‐

Totaladditions 22,475 (3,860) ‐ (9,085) 12,994 32,791 ‐ ‐ ‐ (1,219) 10 54,106

DeductionsConstructionexpenses ‐ ‐ ‐ ‐ 2,362 ‐ ‐ ‐ ‐ ‐ ‐ 2,362Operatingexpenses ‐ ‐ ‐ (4,373) (2,362) 37,605 ‐ ‐ ‐ ‐ ‐ 30,870Paymentofprincipal 10,985 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 10,985Interestpaid 10,831 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 10,831

Totaldeductions 21,816 ‐ ‐ (4,373) ‐ 37,605 ‐ ‐ ‐ ‐ ‐ 55,048

BalanceatJune30,2016 16,293$ 24,964$ ‐$ 215$ 35,075$ 3,088$ ‐$ 90$ ‐$ 6,091$ 2,907$ 88,723$


130

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYCANYONPOWERPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)

RevenueFund

OperatingFund

DebtServiceFund

DebtServiceReserveFund ProjectFund

U.S.TreasuryDirectSubsidy

CostofIssuanceFund EscrowFund Total

BalanceatJune30,2015 ‐$ 631$ 8,366$ 19,721$ 4,238$ 1,836$ ‐$ ‐$ 34,792$

AdditionsInvestmentearnings ‐ ‐ 6 259 2 ‐ ‐ ‐ 267Discountoninvestmentpurchases ‐ ‐ 4 1 2 ‐ ‐ ‐ 7Distributionofinvestmentearnings 270 ‐ (10) (260) ‐ ‐ ‐ ‐ ‐Receiptfromparticipants 21,975 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 21,975Distributionofrevenues (22,245) 2,632 21,449 ‐ ‐ (1,836) ‐ ‐ ‐BondProceeds2016A ‐ ‐ (1,038) ‐ ‐ ‐ 535 94,337 93,834Other ‐ 135 3,926 ‐ ‐ (1,846) ‐ ‐ 2,215

Totaladditions ‐ 2,767 24,337 ‐ 4 (3,682) 535 94,337 118,298$

DeductionsConstructionexpenses ‐ ‐ ‐ ‐ (5) ‐ ‐ ‐ (5)Operatingexpenses ‐ 2,754 ‐ ‐ ‐ ‐ ‐ ‐ 2,754Interestpaid ‐ ‐ 16,732 ‐ ‐ (3,693) ‐ ‐ 13,039DebtIssueCosts ‐ ‐ ‐ ‐ ‐ ‐ 507 ‐ 5072010ABondRedemption‐Escrow ‐ ‐ ‐ ‐ ‐ ‐ ‐ 94,337 94,337

Totaldeductions ‐ 2,754 16,732 ‐ (5) (3,693) 507 94,337 110,632

BalanceatJune30,2016 ‐$ 644$ 15,971$ 19,721$ 4,247$ 1,847$ 28$ ‐$ 42,458$

This schedule summarizes the receipts and disbursements in funds required under the Bond Indenture and has been prepared from the truststatements.Thebalances in the funds consistof cashand investments atoriginal cost.Thesebalancesdonot includeaccrued interest receivableorunrealizedgain(loss)oninvestments,or$6and$18heldintherevolvingfundatJune30,2016and2015,respectively.

131

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYAPEXPOWERPROJECT



RevenueFund

DepositoryFund

OperatingFund

DebtServiceFund

DebtServiceReserveFund

Reserve&Contingency

FundGeneralReserve ProjectFund

CostofIssuanceFund Total

BalanceatJune30,2015 ‐$ ‐$ 17,440$ 15,639$ 5,488$ 3,997$ 58$ 29,435$ ‐$ 72,057$

AdditionsInvestmentearnings ‐ ‐ 4 1 45 6 ‐ 52 ‐ 108Discountoninvestmentpurchases 30 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 30Distributionofinvestmentearnings 56 ‐ (4) (1) (45) (6) ‐ ‐ ‐ ‐Receiptfromparticipants 35,718 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 35,718Distributionofrevenues (36,804) 37,765 (22,104) 21,943 ‐ (800) ‐ ‐ ‐ ‐Othertransfers 796 (488) 5,389 ‐ ‐ (3,190) ‐ (2,507) ‐ ‐Otherreceipts 204 4,638 1 ‐ ‐ ‐ ‐ ‐ ‐ 4,843

Totaladditions ‐ 41,915 (16,714) 21,943 ‐ (3,990) ‐ (2,455) ‐ 40,699

DeductionsAcquisitioncosts ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐Operatingexpenses ‐ 41,915 ‐ ‐ ‐ 2 ‐ ‐ ‐ 41,917Paymentofprincipal ‐ ‐ ‐ 9,335 ‐ ‐ ‐ ‐ ‐ 9,335Interestpaid ‐ ‐ ‐ 12,588 ‐ ‐ ‐ ‐ ‐ 12,588

Totaldeductions ‐ 41,915 ‐ 21,923 ‐ 2 ‐ ‐ ‐ 63,840

BalanceatJune30,2016 ‐$ ‐$ 726$ 15,659$ 5,488$ 5$ 58$ 26,980$ ‐$ 48,916$

This schedule summarizes the receipts and disbursements in funds required under the Bond Indenture and has been prepared from the truststatements.Thebalances inthefundsconsistofcashandinvestmentsatoriginalcost.Thesebalancesdonot includeaccruedinterestreceivableandunrealizedgain(loss)oninvestments,or$12and$21heldintherevolvingfundatJune30,2016and2015,respectively.

132

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYHOOVERUPRATINGPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)

DebtServiceFund

GeneralReserveFund OperatingFund RevenueFund Total

BalanceatJune30,2015 1,527$ 1,700$ 1,337$ ‐$ 4,564$

AdditionsInvestmentearnings 1 17 3 ‐ 21Discountoninvestments 1 ‐ 1 ‐ 2Distributionofinvestmentearnings (2) (17) (4) 23 ‐Revenuefrompowersales ‐ ‐ ‐ 2,320 2,320Distributionofrevenue 2,246 ‐ 97 (2,343) ‐

Totaladditions 2,246 ‐ 97 ‐ 2,343

DeductionsOperatingexpenses ‐ ‐ 157 ‐ 157Paymentofprincipal 1,930 ‐ ‐ ‐ 1,930Interestpaid 269 ‐ ‐ ‐ 269

Totaldeductions 2,199 ‐ 157 ‐ 2,356

BalanceatJune30,2016 1,574$ 1,700$ 1,277$ ‐$ 4,551$


133

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYTIETONHYDROPOWERPROJECT



RevenueFundOperatingFund

DebtServiceFund


Reserve&Contingency

FundGeneral

ReserveFund Total

BalanceatJune30,2015 ‐$ 570$ 2,099$ 5,008$ 419$ 24$ 8,120$

AdditionsInvestmentearnings ‐ 1 1 66 1 ‐ 69Distributionofinvestmentearnings 69 (1) (1) (66) (1) ‐ ‐

Receiptfromparticipants 5,532 ‐ ‐ ‐ ‐ ‐ 5,532Distributionofrevenues (5,601) 2,243 3,358 ‐ ‐ ‐ ‐

Totaladditions ‐ 2,243 3,358 ‐ ‐ ‐ 5,601

DeductionsOperatingexpenses ‐ 2,252 ‐ ‐ ‐ ‐ 2,252Paymentofprincipal ‐ ‐ 840 ‐ ‐ ‐ 840Interestpaid ‐ ‐ 2,503 ‐ ‐ ‐ 2,503

Totaldeductions ‐ 2,252 3,343 ‐ ‐ ‐ 5,595

BalanceatJune30,2016 ‐$ 561$ 2,114$ 5,008$ 419$ 24$ 8,126$


134

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYMILFORD1WINDPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)

RevenueFund

OperatingFund

DebtServiceFund


GeneralReserveFund

OperatingReserveFund Total

BalanceatJune30,2015 ‐$ 4,438$ 13,846$ 18,874$ 2,520$ 3,000$ 42,678$

AdditionsInvestmentearnings ‐ 4 5 235 9 32 285Discountoninvestments ‐ 1 1 10 2 ‐ 14Distributionofinvestmentearnings 299 (5) (6) (245) (11) (32) ‐Receiptfromparticipants 31,817 ‐ ‐ ‐ ‐ ‐ 31,817Distributionofrevenues (32,116) 13,244 18,872 ‐ ‐ ‐ ‐

Totaladditions ‐ 13,244 18,872 ‐ ‐ ‐ 32,116

DeductionsOperatingexpenses ‐ 12,412 ‐ ‐ ‐ ‐ 12,412Paymentofprincipal ‐ ‐ 8,820 ‐ ‐ ‐ 8,820Interestpaid ‐ ‐ 9,874 ‐ ‐ ‐ 9,874

Totaldeductions ‐ 12,412 18,694 ‐ ‐ ‐ 31,106

BalanceatJune30,2016 ‐$ 5,270$ 14,024$ 18,874$ 2,520$ 3,000$ 43,688$

This schedule summarizes the receipts and disbursements in funds required under the Bond Indenture and has been prepared from the truststatements. The balances in the funds consist of cash and investments at original cost. These balances do not include accrued interest receivable,unrealizedgain(loss)oninvestments,or$9heldintherevolvingfundatJune30,2016and2015.

135

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYMILFORD2WINDPROJECT



RevenueFund OperatingFundDebtService

FundDebtServiceReserveFund Total

BalanceatJune30,2015 ‐$ 5,218$ 9,195$ 3,216$ 17,629$

AdditionsInvestmentearnings ‐ 7 3 43 53Discountoninvestments ‐ 1 4 ‐ 5Distributionofinvestmentearnings 62 (12) (7) (43) ‐

Receiptfromparticipants 18,414 ‐ ‐ ‐ 18,414Distributionofrevenues (18,476) 5,610 12,866 ‐ ‐

Totaladditions ‐ 5,606 12,866 ‐ 18,472

DeductionsOperatingexpenses ‐ 5,195 ‐ ‐ 5,195Paymentofprincipal ‐ ‐ 5,530 ‐ 5,530Interestpaid ‐ ‐ 7,201 ‐ 7,201

Totaldeductions ‐ 5,195 12,731 ‐ 17,926

BalanceatJune30,2016 ‐$ 5,629$ 9,330$ 3,216$ 18,175$


136

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYWINDYPOINTPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)


FundDebtServiceReserveFund Total

BalanceatJune30,2015 ‐$ 8,971$ 30,218$ 10,262$ 49,451$

AdditionsInvestmentearnings ‐ 12 7 145 164Discountoninvestments ‐ 2 20 6 28Distributionofinvestmentearnings 192 (14) (27) (151) ‐

Receiptfromparticipants 80,271 ‐ ‐ ‐ 80,271Distributionofrevenue (80,463) 39,420 41,043 ‐ ‐

Totaladditions ‐ 39,420 41,043 ‐ 80,463

DeductionsOperatingexpenses ‐ 41,767 ‐ ‐ 41,767Paymentofprincipal ‐ ‐ 19,390 ‐ 19,390Interestpaid ‐ ‐ 21,277 ‐ 21,277Premiumoninvestmentpurchases ‐ 3 ‐ ‐ 3


BalanceatJune30,2016 ‐$ 6,621$ 30,594$ 10,262$ 47,477$


137

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYLINDENWINDENERGYPROJECT




FundDebtServiceReserveFund

GeneralReserveFund ProjectFund

U.S.TreasuryDirectSubsidy Total

BalanceatJune30,2015 ‐$ 1,732$ 6,913$ 2,324$ 69$ 587$ 399$ 12,024$

AdditionsInvestmentearnings ‐ 1 2 23 ‐ ‐ ‐ 26Discountoninvestments ‐ ‐ 4 ‐ ‐ ‐ ‐ 4Distributionofinvestmentearnings 30 (1) (6) (23) ‐ ‐ ‐ ‐

Revenuefrompowersales 17,025 ‐ ‐ ‐ ‐ ‐ ‐ 17,025Distributionofrevenue (17,055) 7,833 9,222 ‐ ‐ ‐ ‐ ‐Othertransfers ‐ 21 800 ‐ (21) ‐ (800) ‐Otherreceipts ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaladditions ‐ 7,854 10,022 ‐ (21) ‐ (800) 17,055

DeductionsOperatingexpenses ‐ 7,828 ‐ ‐ ‐ ‐ ‐ 7,828Paymentofprincipal ‐ ‐ 3,670 ‐ ‐ ‐ ‐ 3,670Interestpaid ‐ ‐ 6,411 ‐ ‐ ‐ (803) 5,608Premiumandinterestoninvestmentpurchases ‐ (1) 1 ‐ ‐ ‐ 1 1

Totaldeductions ‐ 7,827 10,082 ‐ ‐ ‐ (802) 17,107

BalanceatJune30,2016 ‐$ 1,759$ 6,853$ 2,324$ 48$ 587$ 401$ 11,972$


138

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYSOUTHERNTRANSMISSIONSYSTEMPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)

GeneralReserveFund IssueFund OperatingFund RevenueFund Total

BalanceatJune30,2015 2,899$ 85,280$ 4,958$ ‐$ 93,137$

AdditionsInvestmentearnings 10 680 4 1 695Discountoninvestmentpurchases 4 83 ‐ ‐ 87Distributionofinvestmentearnings (14) (763) (4) 781 ‐Revenuefromtransmissionsales ‐ ‐ ‐ 113,422 113,422Distributionofrevenue 4,995 76,738 32,471 (114,204) ‐Transfer(from)/toescrowfundforprincipalandinterestpayment ‐ ‐ ‐ ‐ ‐

Other 1 (2) 1 ‐ ‐

Totaladditions 4,996 76,736 32,472 ‐ 114,204

DeductionsConstructionexpenses ‐ ‐ ‐ ‐ ‐Operatingexpenses ‐ ‐ 34,480 ‐ 34,480Paymentofprincipal ‐ 53,085 ‐ ‐ 53,085Interestpaid ‐ 26,606 ‐ ‐ 26,606Debtissuancecosts ‐ 55 ‐ ‐ 55Premiumandinterestoninvestmentpurchases ‐ (3) ‐ ‐ (3)


BalanceatJune30,2016 7,895$ 82,273$ 2,950$ ‐$ 93,118$


139

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYMEAD‐PHOENIXPROJECT



RevenueFundDebtServiceAccount

DebtServiceReserveAccount

OperatingFund

Reserve&Contingency

Fund ProjectFund SurplusFundCostof

IssuanceFund Total

BalanceatJune30,2015 ‐$ 6,170$ ‐$ 1,007$ 12$ ‐$ 371$ ‐$ 7,560$

AdditionsInvestmentearnings ‐ 2 ‐ 1 ‐ ‐ ‐ ‐ 3Discountoninvestmentearnings ‐ 3 ‐ ‐ ‐ ‐ ‐ ‐ 3Distributionofinvestmentearnings 7 (6) ‐ (1) ‐ ‐ ‐ ‐ ‐Transmissionrevenue 8,169 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 8,169Distributionofrevenues (8,176) 7,029 ‐ 1,005 297 ‐ (155) ‐ ‐BondProceeds2016A ‐ ‐ ‐ ‐ ‐ 26,647 ‐ 347 26,994Other ‐ ‐ ‐ 86 97 226 (97) ‐ 312

Totaladditions ‐ 7,028 ‐ 1,091 394 26,873 (252) 347 35,481

DeductionsOperatingexpenses ‐ ‐ ‐ 1,613 ‐ ‐ ‐ ‐ 1,613Constructionexpenses ‐ ‐ ‐ ‐ 397 26,873 ‐ ‐ 27,270Principalpayment ‐ 5,480 ‐ ‐ ‐ ‐ ‐ ‐ 5,480Debtissuecosts ‐ ‐ ‐ ‐ ‐ ‐ ‐ 318 318Interestpaid ‐ 1,254 ‐ ‐ ‐ ‐ ‐ ‐ 1,254

Totaldeductions ‐ 6,734 ‐ 1,613 397 26,873 ‐ 318 35,935

BalanceatJune30,2016 ‐$ 6,464$ ‐$ 485$ 9$ ‐$ 119$ 29$ 7,106$


140

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYMEAD‐ADELANTOPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)

RevenueFundDebtServiceAccount


OperatingFund

Reserve&Contingency Projectfund

CostofIssuance SurplusFund Total

BalanceatJune30,2015 ‐$ 20,227$ ‐$ 750$ 42$ ‐$ ‐$ 7,556$ 28,575$

AdditionsInvestmentearnings ‐ 8 ‐ 1 ‐ ‐ ‐ 3 12Discountoninvestmentearnings ‐ 7 ‐ ‐ ‐ ‐ ‐ 6 13Distributionofinvestmentearnings 25 (15) ‐ (1) ‐ ‐ ‐ (9) ‐Transmissionrevenue 25,117 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 25,117Distributionofrevenues (25,142) 22,517 ‐ 2,162 463 ‐ ‐ ‐ ‐BondProceeds2016A ‐ ‐ ‐ ‐ ‐ 32,824 410 ‐ 33,234Other ‐ ‐ ‐ (7) ‐ 287 ‐ ‐ 280

Totaladditions ‐ 22,517 ‐ 2,155 463 33,111 410 ‐ 58,656

DeductionsConstructionexpenses ‐ ‐ ‐ ‐ 153 33,111 ‐ ‐ 33,264Operatingexpenses ‐ ‐ ‐ 2,267 ‐ ‐ ‐ ‐ 2,267Principalpayment ‐ 17,690 ‐ ‐ ‐ ‐ ‐ ‐ 17,690Debtissuecosts ‐ ‐ ‐ ‐ ‐ ‐ 372 ‐ 372Interestpaid ‐ 4,636 ‐ ‐ ‐ ‐ ‐ ‐ 4,636

Totaldeductions ‐ 22,326 ‐ 2,267 153 33,111 372 ‐ 58,229

BalanceatJune30,2016 ‐$ 20,418$ ‐$ 638$ 352$ ‐$ 38$ 7,556$ 29,002$


141

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYNATURALGASPINEDALEPROJECT




FundGeneral

ReserveFund ProjectFund CapitalFund Total

BalanceatJune30,2015 ‐$ 3,816$ 2,971$ 38$ 2,695$ (247)$ 9,273$

AdditionsInvestmentearnings ‐ 4 1 ‐ 2 ‐ 7Discountoninvestmentpurchases ‐ ‐ ‐ ‐ ‐ ‐ ‐Distributionofinvestmentearnings 1 ‐ (1) ‐ ‐ ‐ ‐Receiptfromparticipants 4,825 10,084 ‐ ‐ ‐ ‐ 14,909Salesofnaturalgas 483 4,863 ‐ ‐ ‐ ‐ 5,346Distributionofrevenues (5,309) 1,482 3,522 ‐ 8 297 ‐Othertransfer ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaladditions ‐ 16,433 3,522 ‐ 10 297 20,262

DeductionsConstructionexpenses ‐ ‐ ‐ ‐ ‐ 31 31Operatingexpenses ‐ 14,798 ‐ ‐ ‐ ‐ 14,798Paymentofprincipal ‐ ‐ 2,274 ‐ ‐ ‐ 2,274Interestpaid ‐ ‐ 1,330 ‐ ‐ ‐ 1,330

Totaldeductions ‐ 14,798 3,604 ‐ ‐ 31 18,433

BalanceatJune30,2016 ‐$ 5,451$ 2,889$ 38$ 2,705$ 19$ 11,102$


142

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYNATURALGASBARNETTPROJECTSUPPLEMENTALSCHEDULEOFRECEIPTSANDDISBURSEMENTSINFUNDSREQUIREDBYTHEBONDINDENTUREFORTHEYEARENDEDJUNE30,2016(AMOUNTSINTHOUSANDS)


FundGeneral

ReserveFund ProjectFund CapitalFund Total

BalanceatJune30,2015 ‐$ 2,022$ 6,958$ 22$ 39,839$ (5,291)$ 43,550$

AdditionsInvestmentearnings ‐ 2 4 ‐ 212 ‐ 218Discountoninvestmentpurchases ‐ ‐ ‐ ‐ 23 ‐ 23Distributionofinvestmentearnings 4 ‐ (4) ‐ ‐ ‐ ‐Receiptfromparticipants 8,786 172 ‐ ‐ ‐ ‐ 8,958Salesofnaturalgas 1,751 390 ‐ ‐ ‐ ‐ 2,141Distributionofrevenues (10,541) 2,174 8,258 ‐ (367) 476 ‐Otherreceipts ‐ ‐ ‐ ‐ ‐ ‐ ‐

Totaladditions ‐ 2,738 8,258 ‐ (132) 476 11,340

DeductionsConstructionexpenses ‐ ‐ ‐ ‐ ‐ 448 448Operatingexpenses ‐ 2,869 ‐ ‐ ‐ ‐ 2,869Paymentofprincipal ‐ ‐ 5,326 ‐ ‐ ‐ 5,326Interestpaid ‐ ‐ 3,128 ‐ ‐ ‐ 3,128

Totaldeductions ‐ 2,869 8,454 ‐ ‐ 448 11,771

BalanceatJune30,2016 ‐$ 1,891$ 6,762$ 22$ 39,707$ (5,263)$ 43,119$


143

SOUTHERNCALIFORNIAPUBLICPOWERAUTHORITYPREPAIDNATURALGASPROJECTNo.1




Fund Total

BalanceatJune30,2015 ‐$ 12,554$ 3,492$ 16,046$

AdditionsInvestmentearnings ‐ 487 205 692Discountoninvestmentpurchases ‐ ‐ (1) (1)Distributionofinvestmentearnings 484 (484) ‐ ‐Receiptfromgassales 5,934 ‐ ‐ 5,934Distributionofrevenues (20,309) 430 19,879 ‐Commodityswapsettlement 13,891 ‐ ‐ 13,891Otherreceipts ‐ ‐ 622 622

Totaladditions ‐ 433 20,705 21,138

DeductionsA&Gexpenses ‐ 310 ‐ 310Paymentofprincipal ‐ ‐ 4,075 4,075Paymentofinterest ‐ ‐ 16,281 16,281

Totaldeductions ‐ 310 20,356 20,666

BalanceatJune30,2016 ‐$ 12,677$ 3,841$ 16,518$


Documents

Southern California Public Power Authority - SCPPAscppa.org/file.axd?file=/2016/12/FS FY 2015-2016.pdf · SOUTHERN CALIFORNIA PUBLIC POWER AUTHORITY MANAGEMENT’S DISCUSSION AND