Texoma Regional Public Meeting
April 4, 2014
Fritha Ohlson
Director, Division of Resources & Rates
Slide 2 Southwestern Power Administration
Topics
SWPA General Information
SWPA Customers
SWPA System
U.S. Electric Grid Interconnections & SWPA System Map
SWPA Rates
Denison Hydropower
Funds Returned to U.S. Treasury
SWPA Denison Drought Operations
Generation Data
SWPA Denison Outlook
Recap
Slide 3
SWPA General Information
Southwestern Power Administration (SWPA)
Agency of the US Department of Energy
Power Marketing Administration
Section 5 of the Flood Control Act of 1944“…encourage most widespread use at lowest
possible rates…
…sound business principles…
…preference to public bodies and cooperatives.”
Cost based rates; not for profit
Repay Federal Investment
Slide 4 Southwestern Power Administration
SWPA General Information
Slide 5 Southwestern Power Administration
SWPA Customers
SWPA markets cost-based, wholesale power
to not-for-profit preference customers in six
states: Arkansas, Kansas, Louisiana,
Missouri, Oklahoma, and Texas.
Over 100 customers
21 Cooperatives
78 Municipalities
3 Military installations
Over 8 million end users
Slide 6
Slide 7
SWPA System
SWPA markets hydropower from 24 Federal, multi-purpose hydropower projects owned by the U.S. Army Corps of Engineers (Corps).
Marketed capacity: 2,052.6 MW
Average annual energy: 5,570,000 MWh
SWPA operates 1,380 miles of high-voltage transmission line, 25 substations, and 46 communications sites.
Of the 24 hydropower projects, 19 are operated as an Interconnected System within the Southwest Power Pool (SPP) region (Eastern Interconnection).
Denison (Lake Texoma), which is one of the 5 remaining electrically isolated projects, is within the ERCOT region (ERCOT Interconnection).
Southwestern Power Administration
Slide 8
U.S. Electric Grid Interconnections
Southwestern Power Administration
Slide 9 Southwestern Power Administration
SWPA System Map
Disconnected
Slide 10
SWPA Rates
Cost Based – 100% of hydropower cost and the allocated percent of joint-use costs unique to each project:
-Initial construction costs
-Interest during construction
-Interest on investment
-Annual operation and maintenance
-New replacement equipment
22 of 24 projects – including Denison – are blended
together to make the “Integrated System Rate.” There
are 2 other rate systems, Sam Rayburn and Robert Willis,
both isolated projects in Texas.
Although Denison, Narrows, and Whitney are electrically
isolated, they are financially integrated.
Southwestern Power Administration
Slide 11
Denison Hydropower
Denison is located in the ERCOT region and contractually its full output is received by two Texas Electric Cooperatives: Tex-La and Rayburn Country
Based on current SWPA rates and an average hydrological year, the annual revenue returned to the U.S. Treasury from Denison generation is about $6 million. The estimated annual replacement cost is nearly $19 million.
Important power resource for the region providing quick-response peaking power.
In an average hydrological year, the clean, renewable generation from Denison prevents the emission of 182,200 tons of greenhouse gases by offsetting the need for fossil fuel generation (1.9 billion cubic feet of natural gas or 113,900 tons of coal).
Southwestern Power Administration
Slide 12
Distribution of Funds Returned to
U.S. Treasury by SWPA
Southwestern Power Administration
24 Projects Denison
Original Investment $788 Million $30 Million
Interest $772 Million $25 Million
Operations & Maintenance $1,255 Million $75 Million
Total $2,815 Million $130 Million
As of fiscal year ending September 30, 2013 (unaudited)
Slide 13
Funds Returned to U.S. Treasury
from Lake Texoma
Southwestern Power Administration
Slide 14
Drought 2011-14 Texoma Inflow and Elev.
Southwestern Power Administration
Slide 15
SWPA Denison Drought Operations
Southwestern Power Administration
SWPA strictly adheres to the Corps’ Lake Texoma Water Control Manual and Drought Contingency Plan
Southwestern operates in full compliance with Public Law 100-71
Between 617-612 feet: Normal generation
Between 612-607 feet: Rapid response, short term peaking
Between 607-590 feet: Critical power needs
The project is designed so that inflows combined with the
conservation pool storage provide a reliable water source
for the water supply and hydropower authorized purposes
to which conservation pool storage is allocated,
especially during times of drought.
Slide 16
SWPA Denison Drought Operations
Southwestern Power Administration
SWPA has been operating in drought mode since January 2011, generating only 25% of average.
Since May 2012, generation has been even less, about 19% of average.
2013 – Lowest year of power generation ever since generation began at Denison in 1945.
In 2013, SWPA customers spent over $5,000,000 to replace hydropower usually produced at Denison.
Slide 17
Historical Generation
Southwestern Power Administration
Slide 18
2011-2014 Monthly Generation
Southwestern Power Administration
Slide 19
SWPA Denison Outlook
Southwestern Power Administration
Will continue to operate the generation at
Denison pursuant to PL 100-71, Corps
regulations and approved plans, and SWPA’s
Federal contracts.
Member of Lake Texoma Advisory Committee.
Generation outlook is mindful of drought
conditions. SWPA customers predict that this
trend will continue in 2014 if low water levels
persist, and that they will continue replacing
hydropower usually generated out of Denison
with power purchased from other sources.
Slide 20
Lake Texoma Pool Elevation 2014 Outlook
Assumptions: Current level water supply use; 2011 evaporation; Median Inflow at 2, 4, and 6
hours/day generation; Historical Low Inflow (2011) at 2 and 4 hours/day generation.
Slide 21
Recap
Southwestern Power Administration
Lake Texoma drought conditions: 2011-present.
Denison hydropower generation at historical
lows.
Lake Texoma conservation storage is working as
designed.
SWPA will continue to operate in drought mode
until the Lake Texoma Red River watershed
recovers, pursuant to all applicable laws,
regulations, and Federal contracts.