[8] Surplus Sales Lift BPA Revenues

The Bonneville Power Administration's net revenues for the year could be $250 million higher than originally forecast, thanks to an above-average snowpack and high market prices.

The federal power-marketing agency last week revised its net revenue projections for fiscal year 2006 to $450 million--up from its initial forecast of $200 million made at the start of the fiscal year.

But BPA warned that increased revenues might be counterbalanced by increased spending on salmon recovery, negating any potential rate reductions. Bonneville plans to release its rate structure for 2007-09 in September.

The revised forecast was evidence that BPA is almost out of the financial ditch it was pushed into by a series of low water years and the West Coast energy crisis. If the forecast holds, it would be the fourth year in row BPA has finished in the black, and would bring it within $40 million of financially breaking even for the years 2001-2006.

In 2001 and 2002, BPA lost more than $700 million.

"We finally see daylight after spending the last five years climbing our way out of a deep financial hole created by the energy crisis and several years of low water," said Steve Wright, BPA administrator, in a prepared statement.

The revised forecast calls secondary revenues to be $810 million, based on a slightly above average water year of 108 million-acre feet. Initial forecasts were based on 104 million-acre feet of water and $560 million in secondary revenues.

The revised forecast is another ripple of good financial news that has lifted BPA recently.

Last month the Internal Revenue Service ruled that BPA could make direct payments on $6.5 billion in BPA-backed bonds, rather than deducting the bond payments from its customers' bills late in the year.

Bonneville has been hinting that it may be able to lower rates by 5 percent. -Steve Ernst

Subscriptions and Feedback
Subscribe to the Fishletter notification e-mail list.
Send e-mail comments to the editor.

THE ARCHIVE :: Previous NW Fishletter issues and supporting documents.

NW Fishletter is produced by Energy NewsData.
Publisher: Cyrus Noë, Editor: Bill Rudolph
Phone: (206) 285-4848 Fax: (206) 281-8035