Archive for the ‘Monthly Summary’ Category

Friday, October 22nd, 2021

 

 

 

BUSINESS OPERATIONS – October 2021

ARPA Board Reviews 2022 Budget: The ARPA Board of Directors reviewed its proposed 2022 budget at the September meeting. The proposed 2022 budget includes:

  • Power Sales Revenues of $30.46 million
  • Power Supply costs of $14.23 million
  • Transmission costs of $3.5 million
  • A&G costs of $1.3 million
  • Debt Service costs of $8.27 million

ARPA’s 2022 Budget Hearing is scheduled for December 2, in La Junta at the Otero Junior College Student Center. 

ARPA’s Six Member Systems-A bit of History: Holly: The Town of Holly purchased its municipal utility in 1949. The utility serves an area of approximately 24 square miles with 31 miles of distribution facilities. Holly manages and operates 1.8 MW of diesel generation for ARPA. La Junta: The La Junta municipal electric utility was created in 1939 and serves an area of approximately 10 square miles. La Junta operates approximately 55 miles of distribution line and 6.3 miles of transmission line. Lamar: The Lamar municipal electric utility has been in existence since 1920 and serves approximately 170 square miles, comprised of areas both within and outside the municipal boundaries. Lamar’s facilities include approximately 345 miles of distribution line and 36 miles of transmission line. Lamar operates and manages ARPA’s wind turbines. Las Animas: The Las Animas municipal electric utility was established in 1941 and serves an area of approximately 22 square miles. Las Animas’ facilities include about 50 miles of distribution line and 13 miles of transmission line. Springfield: The Springfield municipal electric utility was established in 1947 and serves an area of approximately two square miles. Springfield has approximately 26 miles of distribution line, which includes four miles of distribution line to the ARPA wind turbine in Springfield. Trinidad: The Trinidad municipal electric utility was established in 1949 and serves an area of approximately 9 square miles. Trinidad’s facilities include approximately 72 miles of distribution line.  Trinidad operates and manages 5.8 MW of diesel generation for ARPA.

Summary of August 2021 Financial and Operating Statements: During the month of August, revenue from power sales were 6.3% better than budget and total cost of goods sold were over budget by 1.5%. Net Operating revenue for the month was $827,483. Year to Date revenues from power sales are just under budget (0.3%) and cost of goods sold are 2.9% under budget. Net Operating revenues YTD are $4.1 million. Member Energy sales were 5.9% more than budget in August and 1.1% less when compared to August 2020. Member Sales YTD are 0.5% less than budget and 3% lower than 2020.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, October 28, 2021. The meeting will be held in Trinidad at the Golf Course Clubhouse, 1415 Franklin D Azar Drive. The meeting notice and agenda will be posted on ARPA’s website (arpapower.org) under Public Notices and will also be posted in a designated location in each of the member cities at least 24 hours in advance of the meeting. ARPA board meetings are open to the public.

Friday, October 22nd, 2021

 

 

 

BUSINESS OPERATIONS – September 2021

ARPA Board Reviews Preliminary 2022 Budget: A preliminary budget was presented to the ARPA Board of Directors at its August 26 meeting. The budget includes total revenues of $30.4 million, power supply costs of $14.3 million, transmission costs of $3.5 million, A&G costs of $1.4 million, and debt service costs of $8.3 million. This debt service amount is a reduction of $1.2 million from the 2020 budget due to the retirement of the 2010 Bonds in January 2021. The budget also includes achieving a 1.29x debt service coverage and full funding for bond reserve accounts as required by ARPA’s bond covenants. There is no rate increase included in the 2022 budget. ARPA adopted a rate decrease in 2021 that is carried forward in its 2022 budget, and the lower rate is projected to remain in effect through 2024. The budget hearing and final approval of the 2022 budget is scheduled for December 2 at the Board of Directors meeting to be held in La Junta.

FitchRatings Reaffirms ARPA’s Investment Grade Credit Rating of BBB- with Stable Outlook: Fitch Ratings recently affirmed its investment grade BBB- long-term rating and underlying rating on the Arkansas River Power Authority’s power revenue bonds. The outlook is stable. The rating reflects ARPA’s strong revenue defensibility and strong operating risk profile. ARPA’s strong revenue defensibility is derived from its all-requirements long-term wholesale power supply contracts and the independent legal ability of ARPA, and its members, to raise electric rates if necessary. Operating risk is characterized by a low operating cost burden, reflecting ARPA’s low purchased power costs. ARPA’s power supply is provided primarily through a purchase contract through January 31, 2025. The Rating weaknesses identified included ARPA’s debt service being elevated due to the issuance of debt related to revenue bonds associated with the Lamar Repowering Project. The full Fitch rating report can be viewed here.

Summary of July 2021 Financial and Operating Statements: During the month of July, revenue from power sales were 1.9% under budget and total cost of goods sold were under budget by 7.7%. Net Operating revenue for the month was $870,198. Year to Date revenues from power sales are 1.5% less than budget and cost of goods sold are 3.6% under budget. Net Operating revenues YTD are $3.27 million. Member Energy sales were 2.5% less than budget in July and 4.9% less when compared to July 2020. Member Sales YTD are 1.6% less than budget and 3.5% lower than 2020.

Western Area Power Administration CRSP Hydro Update: WAPA is currently reviewing a 24-Month Study report for the Colorado River. The Colorado River Storage Project sells hydropower generated at 11 federal dams in the Upper Colorado River Basin, including Glen Canyon Dam. The Colorado River is at historically low water levels following two decades of drought. When there is less hydropower, replacement power may need to be purchased in the open market, to fulfill contractual obligations, which is frequently more expensive than federal hydropower. WAPA is working with power customers to mitigate drought impacts and alleviate any loss of hydropower generation. Unfortunately for WAPA-CRSP customers, it appears the hydro-allocations will be reduced to reflect the decreased generation from the hydro generating resources.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, September 30, 2021. The meeting will be held at the Holly Senior and Community Center, in Holly, CO. The meeting notice and agenda will be posted on ARPA’s website (arpapower.org) under Public Notices and will also be posted in a designated location in each of the member cities at least 24 hours in advance of the meeting. ARPA board meetings are open to the public.

Wednesday, August 11th, 2021

 

 

 

BUSINESS OPERATIONS – August 2021

2020/2021 Operations: As the ARPA Board prepares to begin its budgeting process for 2022, it does so by looking back over a handful of significant events that occurred during the first half of 2021. The events ranged from the repurposing and demolition of the Authority’s coal fired Lamar Repowering Plant to new legislation impacting the operations of electric utilities statewide. The first two significant events began with the new year. The Authority reduced its basic energy rate by 3.6%. The rate decrease became effective as of January 1 and followed on the heels of a rate reduction that was implemented in 2019. The two rate reductions have lowered ARPA’s total all-in-rate to its members by approximately 4.5%.

In January, the Authority also retired approximately $14.8 million in debt by paying off its 2010 bonds. The financial impact resulted in an annual cost savings of approximately $1.2 million. This, in combination with refinancing ARPA’s entire debt (which occurred in 2018), was instrumental in ARPA’s ability to reduce its rates.

In late 2020, ARPA executed a contract for the partial repurposing and partial demolition of its Lamar power plant. The two endeavors were completed at a cost of approximately $1.6 million. ARPA provided funds to the City of Lamar for the repurposing of the northside plant facilities from coal handling to agriculture processing. These facilities included two concrete storage domes, a rail car unloader, and conveyor system. The City, in turn, is working with a private enterprise to repurpose the equipment and property. The demolition occurred for the plant’s coal fired-boiler, steam turbine generator, and baghouse. The demolition work began shortly after the first of the year and was substantially complete by the end of June.

In 2019, the Colorado legislature set goals for the reduction of Green House Gases (GHG) that will require utilities to reduce their carbon emissions. During this past legislative session, additional reporting requirements were developed related to the GHG reduction effort, and the Air Quality Control Commission was assigned the task of developing programs to meet the GHG reduction goals and address Environmental Justice. The legislature also established a State Electric Transmission Authority with the intended purpose of developing badly needed transmission facilities in the state. The need for transmission is especially critical for the ARPA members and Southeast Colorado. Southeast Colorado has some of the best renewable attributes in the state for solar and wind, but additional transmission facilities are needed to develop these resources.

Summary of June 2021 Financial and Operating Statements: During the month of June, revenue from power sales were just better than budget and total cost of goods sold were under budget by 1.6%. Net Operating revenue for the month was $679,058. Year to Date revenues from power sales are 1.4% less than budget and cost of goods sold are 2.7% under budget. Net Operating revenues YTD are $2,403,036. Member Energy sales were 1.7% less than budget in June and 6.8% less when compared to June 2020. Member Sales YTD are 1.4% less than budget and 3.2% lower than 2020.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, August 26, 2021. The meeting will be held at the Lion’s Den in Springfield, CO. The meeting notice and agenda will be posted on ARPA’s website (arpapower.org) under Public Notices and will also be posted in a designated location in each of the member cities at least 24 hours in advance of the meeting. ARPA board meetings are open to the public.

Friday, June 18th, 2021

 

 

 

BUSINESS OPERATIONS – JUNE 2021

ARPA Board Holds its Annual Election of Officers: The ARPA Board of Directors held officer elections at its meeting on April 29. Board Members elected to serve as officers through April 2022 include Lorenz Sutherland (La Junta), President; Calvin Melcher (Holly), Vice President; Gary Cranson (La Junta), Treasurer; and ARPA staff member, Arvenia Morris, Secretary. Lorenz Sutherland has been on the ARPA Board of Directors since October 2014. He previously served as Vice President beginning in January 2020. Calvin Melcher was appointed to the Board in February 2019. Calvin also serves as Mayor for the Town of Holly. Gary Cranson has been on the ARPA Board since February 2017 and was first elected Treasurer of the Board in May 2019. Gary is a member of the La Junta Utilities Board.

ARPA Scholarship Program: In 2000 ARPA established a College Scholarship Program that awards a $1,000 scholarship to one high school senior in each of the high schools served by ARPA members. The Program is administered through the member municipalities of Holly, La Junta, Lamar, Las Animas, Springfield and Trinidad. The scholarships are funded equally between ARPA and its members. Congratulations to the following individuals on receiving the scholarship for the 2021-2022 school year: Holly: Vivianna Garcia; Lamar: Brailee Crum; McClave (Lamar): McKenzie Kiniston; La Junta: Zeke Rangel; Trinidad: Caitlin Gabrielson; Springfield: Payton Arbuthnot and Las Animas: Kacey Miller. Good luck in your future endeavors!

Summary of April 2021 Financial and Operating Statements: During the month of April, revenue from power sales were less than budget by 2.2% and total cost of goods sold were under budget by 2.7%. Net Revenues from Operation for the month were $325,622. Year to Date revenues from power sales are just under budget by 1.1% and cost of goods sold are 1.4% under budget. Net revenues from Operation YTD are $1,305,982. Member Energy sales for April were 1.6% less than budget. Member Sales YTD are just under budget and approximately 0.8% less than 2020. Wind generation was 11% of the power supply resources for April.

ARPA Board Receives Financial Compliance Report: Aarin Ritter, Finance Manager for ARPA provided the annual Financial Compliance Report to the ARPA Board at its April meeting. Ms. Ritter reported that the Authority is in full compliance with its Bond Covenants including fully funding its Bond Accounts, meeting its Debt Service Coverage Ratio, and the posting of its ongoing financial disclosures, including the quarterly financial reports, on the Municipal Securities Rulemaking Board website- EMMA. ARPA’s financial disclosures can be found at https://dataport.emma.msrb.org.

Update on the Dismantling of the LRP: Mobilization and demolition of the Lamar Repowering Project commenced early in February 2021. The last structure to come down was the boiler and it was felled on Monday, June 7. Demolition and removal of the boiler structure and final cleanup is expected to be complete by late June.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, July 29, 2021. The meeting will be held by GoToMeeting and Conference Call. The meeting notice and agenda will be posted on the ARPA website www.arpapower.org at least 24-hours in advance of the meeting.

Thursday, April 8th, 2021

 

 

 

BUSINESS OPERATIONS – APRIL 2021

Las Animas Municipal Light & Power Honored With National Award For Outstanding Safety Practices: Las Animas Municipal Light & Power has earned the American Public Power Association’s Safety Award of Excellence for safe operating practices in 2020.The utility earned a first place award in the category for utilities with 15,000–29,999 worker-hours of annual worker exposure. Utilities that receive an APPA Safety Award have demonstrated that they have made the health and safety of their employees a core value. Designing and maintaining a top-notch utility safety program takes a lot of hard work and commitment. “Las Animas Municipal Light & Power values employee safety above all else,” stated Ron Clodfelter, Superintendent of Las Animas Municipal Light & Power. “We all recognize the importance of going home to our families each day; this is what drives our dedication to safety.” Well Done and Congratulations!

ARPA Power Supply Contracts Protect it from Electric Market Price Spikes: As the news continues to describe the cost impact to electric ratepayers caused by the February Polar Vortex, ratepayers served by ARPA’s six Members can rest easy. ARPA’s power supply was not affected by the high market prices that occurred during the February cold snap. Some Colorado utilities are reporting costs for February that include a “Fuel Cost Adjustment” of over 11 cents/kWh added to their bills. A second Colorado utility filed a report with the Colorado PUC that its customers could face a $552 surcharge to pay for the price spikes that occurred. The Colorado Attorney General is calling on the Federal Energy Regulatory Commission to investigate “windfall” profits that were made from the market spikes. ARPA’s power supply comes from three sources; wind generation, federal hydro-power allocations, and a purchase power contract that includes set pricing through 2024. This approach for power supply eliminates the risk of market price spikes and provided ARPA the opportunity to not only maintain stable rates, but to reduce rates by 2% in 2019 and 3.6% in 2021. ARPA continues to provide a dependable and competitively priced supply of wholesale electric power to its Members.

Update on the Dismantling of the LRP: The demolition of the Lamar Repowering Project is progressing. The baghouse demolition is complete as is the air-cooled condenser, main pipe rack, and a handful of buildings and enclosures. The demolition activities to the boiler are ongoing in anticipation of its complete demolition scheduled for later this spring. The utility structure and conveyor tube across Maple Street is scheduled for removal early in April. Maple Street will be closed for short periods of time during the removal process. The demolition completion date of early summer continues to remain on schedule.

Summary of February 2021 Financial and Operating Statements: During the month of February, revenue from power sales were better than budget by 5.1% and total cost of goods sold were over budget by 5.9%. Net Revenues from Operation for the month were $299,314. Year to Date revenues from power sales are right on budget and cost of goods sold are 1% over budget. Net revenues from Operation YTD are $611,832. Member Energy sales for February were 5.2% better than budget and 0.8% less than February 2020. Member Sales YTD are 0.6% better than budget and 1.8% less than 2020.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, April 29, 2021. The meeting is scheduled to be held by GoToMeeting and conference call. The meeting notice and agenda will be posted on the ARPA website www.arpapower.org at least 24-hours in advance of the meeting.

Tuesday, March 16th, 2021

 

 

 

BUSINESS OPERATIONS – MARCH 2021

Polar Vortex No Match for ARPA Member Electric Systems: As the polar vortex swept through the ARPA communities and surrounding region this past February, many of our neighboring utilities and states experienced significant power outages that ranged from a few minutes to a few hours, and worse. Fortunately for the ARPA communities, the hard work and planning that our community owned electric systems do to “keep the lights on” paid off. The operating personnel from the cities and towns of Holly, La Junta, Lamar, Las Animas, Springfield, and Trinidad reported little, if any, outages despite temperatures that reached 25 below zero and included wind chill factors of negative 40. Kudos to our local electric utilities for their ongoing commitment to maintain service that keep our houses warm in the winter and cool in the summer, and our businesses operational despite the challenges from Mother Nature.

ARPA Provides Funding for Repurposing Power Generation Equipment to Agriculture Processing Equipment: ARPA reached an agreement with the City of Lamar and North Fork Grain to repurpose equipment that had previously been used for power generation. ARPA redirected funding that was to be used for the demolition of the coal storage domes, ash and limestone silos and associated conveyor systems located on the north side of its Lamar Repowering Project, to be used to support an agriculture facility proposed by North Fork Grain. North Fork Grain hopes to begin its operations at the repurposed north side in the summer of 2021.

Update on the Dismantling of the LRP: The demolition of the Lamar Repowering Project has begun, starting with the demolition of the baghouse on the west side. From there they will move to the turbine/generator building, and the air-cooled condenser. Jackson Demolition, the contractor, is also working on non-structural demolition activities to the boiler in preparation for its demolition. The demolition work is anticipated to be complete by late spring or early summer this year.

Wind Turbine Generation for 2020 3rd Highest in 15 Years of Operation: During the year end operating report, it was noted that the wind generation for ARPA and Lamar Light and Power wind turbines was the 3rd highest since the turbines first full year of operation in 2005. The turbines were commissioned in the spring of 2004 and are approaching 16 years of operation. Typically, the five wind turbines produce between 7% and 8% of ARPA’s energy needs; however, for the months of March (11%), May (11%) and November (12%), the generation exceeded projections. ARPA’s power supply from wind for 2020 was an average of 9%.

Summary of January 2021 Financial and Operating Statements: During the month of January, revenue from power sales were 4.8% less than budget and total cost of goods sold were under budget by 3.7%. Net loss for January was $77,840. Member energy sales YTD are 3.6% less than budget.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, March 25, 2021. Currently, the meeting is scheduled to be held face to face at the Cultural Events Center in Lamar. The meeting notice and agenda will be posted on the ARPA website www.arpapower.org at least 24-hours in advance of the meeting.

Tuesday, February 9th, 2021

 

 

 

BUSINESS OPERATIONS – JANUARY 2021

ARPA Retires its Power Revenue Refunding and Improvement Bonds Series 2010: ARPA directed UMB Bank, its bond trustee, to retire ARPA’s 2010 Bonds effective January 15, in the amount of $15,066,966. The retirement of the Bonds will reduce the Authority’s annual debt service by $1.23 million and was instrumental in ARPA’s ability to implement a 3.6% rate reduction in 2021.

Update on the Dismantling of the LRP: Jackson Demolition, the demolition contractor for the LRP, mobilized to the project site on January 11. Perimeter fencing around the demolition site has been installed and the process for removal of universal waste has begun. The Contractor is awaiting the demolition permit from the Colorado Department of Public Health and Environment (CDPHE), which will allow it to begin demolition of the Air Cooled Condenser, Baghouse, and Steam Turbine. The schedule anticipates completion of the demolition by mid-to late summer.

ARPA Board Considers Approval of 3rd Amendment to the Mutual Release and Settlement Agreement: At its January meeting, the Board approved the 3rd Amendment to the Settlement Agreement that was reached between the City of Lamar and ARPA in 2017. The Amendment was approved contingent on an effective date of February 9, 2021. The Amendment provides that ARPA will convey ownership of the power plant equipment and property located on the north side of Maple Street, to the City. In addition, ARPA will provide the funding originally budgeted for the north side demolition, to the City to be used for re-purposing, renovating or demolition of the equipment. In exchange, ARPA is released from all further obligations with respect to the equipment and property. In an effort to put the equipment back into production, ARPA has been working with the City and a private third-party, to repurpose the equipment into an agriculture related facility.

Summary of Unaudited December 2020 Financial and Operating Statements: During the month of December, revenue from power sales were 2.2% less than budget and total cost of goods sold were under budget by 23.2%. Net revenue for December was $290,364. YTD Total Revenues are 2.8% better than budget and cost of goods sold were 4% under budget. Net revenues YTD are $4,245,051 and member energy sales YTD are 4.2% better than budget.

ARPA Board Adopts Resolution No. 02-21 Designating Meeting Dates and Locations for 2021: The ARPA Board adopted a resolution establishing dates and locations for meetings in 2021. The schedule calls for 5 in-person meetings and 5 remote meetings. The first in-person meeting is tentatively scheduled for March 25. The Board understands it must be flexible, considering the pandemic, and an in-person meeting may be changed to a remote meeting depending on current circumstances. The Agenda for all meetings are posted on the ARPA website at least 24-hours in advance of the scheduled meeting.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, February 25, 2021. The meeting notice and agenda will be posted on the ARPA website www.arpapower.org at least 24-hours in advance of the meeting.

Wednesday, January 20th, 2021

 

 

 

BUSINESS OPERATIONS – DECEMBER 2020

ARPA Board Adopts 2021 Budget: At its December meeting the ARPA Board of Directors approved its operating budget for 2021 in the amount of $24,790,124. The 2021 Budget supports the Board’s goal to retire its 2010 bonds and to reduce its energy rate by approximately 3.6%. The budget as adopted, will ensure funding for operations, rate stability, and disposition of the Lamar Repowering Project. The budget includes:
• Revenues of approximately $30.41 million
• Power supply expense of approximately $14 million
• Transmission expense of approximately $3.6 million
• A&G expense of approximately $1.4 million
• Debt Service expense of $8.3 million

ARPA Board Authorizes the Retirement of ARPA’s 2010 Bonds- Reduces Annual Debt Service by $1.23 Million: The ARPA Board of Directors adopted a Resolution authorizing the redemption of the Authority’s Power Revenue Improvement Bonds, Series 2010. The retirement of the Bonds, with an outstanding principal amount of $14.8 million, is anticipated to be complete by mid-January and will reduce the Authority’s annual debt service by $1.23 million. This is a critical element in the Authority’s long-term financial plan to reduce rates while keeping ARPA on strong financial footing.

Update on the Sale/Dismantling of the LRP: ARPA’s Board of Director’s received an update on the demolition process for its Lamar Repowering Project. The demolition of the power plant is expected to begin on the south side of Maple Street in early January 2021. The south side phase of the demolition is expected to be complete by spring of 2021. A proposal from the City of Lamar for repurposing and re-using the North Plant equipment and domes is still under consideration.

Operating Committee: The managers of the electric departments from the ARPA members (Holly, La Junta, Lamar, Las Animas, Springfield and Trinidad) met in early December. The committee discussed the COVID-19 Protocols that would be implemented in the event a mutual aid situation would arise. The ARPA members have a long history of providing mutual aid to each other for major storm outages and large construction projects. The pandemic could trigger a mutual aid incident of a different nature, as it could impact the health and availability of line crews to perform even day-to-day operations. The committee discussed an approach that will allow mutual aid to be implemented, while ensuring the safety of the crews. The plan will implement COVID-19 protocols, including separation of crews, use of proper personal protective equipment, and enhanced communications between crews. The ARPA members are confident that regardless of the circumstance, mutual aid between utilities will be conducted in a safe and professional manner.

Summary of October 2020 Financial and Operating Statements: During the month of October, revenue from power sales were slightly above budget and total cost of goods sold were under budget by 4.7%. Net revenue for October was $245,599. YTD Total Revenues are 4.7% better than budget and cost of goods sold were 1.1% under budget. Net revenues YTD are $3,837,069 and member energy sales YTD are 5.4% better than budget.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, January 28, 2021. The meeting notice and agenda will be posted on the ARPA website www.arpapower.org at least 24-hours in advance of the meeting.

Tuesday, November 17th, 2020

 

 

 

BUSINESS OPERATIONS – NOVEMBER 2020

ARPA Board Adopts New Wholesale Rate Tariff- Energy Rate Reduced 3.57%:  The ARPA Board of Directors adopted a new rate tariff that includes an energy rate reduction of 3.57% at its October meeting. The reduction in ARPA’s energy rate is a result of ARPA’s ability to retire its 2010 Bonds of $14.8 million early next year. Retiring the bonds will reduce ARPA’s annual debt service costs by $1.25 million. The reduced rate will take effect January 1, 2021. This is the 2nd rate reduction the Authority has implemented within the last two years.

 ARPA’s 2021 Budget Available for Public Inspection: The ARPA Board of Directors reviewed its proposed 2021 budget at its October meeting. The proposed 2021 budget is currently available for inspection by the public in the city clerk’s office in the cities and towns of Holly, La Junta, Lamar, Las Animas, Springfield and Trinidad. Any interested elector in an ARPA member community or electricity consumer of an ARPA member may file objections to the proposed budget at any time prior to its final adoption. Any public comment or questions concerning the proposed 2021 budget should be directed to Rick Rigel, General Manager, at 719-336-3496. ARPA’s 2021 Budget Hearing is scheduled for December 3, in La Junta at the Otero Junior College Student Center and by GoToMeeting. Due to COVID-19 the location of the meeting could be changed. The Public Notice for the meeting will be posted on the ARPA website at least 24-hours prior to the meeting.

Future Power Supply Discussion: The ARPA Board received a preliminary draft Request for Proposal (RFP) requesting options for power supply to replace an existing power supply contract that expires on January 31, 2025. The RFP includes various options for power supply resources that will provide approximately 65% of the Authority’s power supply needs. The new power supply will replace ARPA’s existing power supply contract with Public Service Company of Colorado. The current schedule anticipates that the RFP will be issued to interested parties the week of November 2, with the Board of Directors initial review of responses at its January 28, 2021 meeting.

Update on the Sale/Dismantling of the LRP: ARPA’s Board received an update on the demolition process for its Lamar Repowering Project. The demolition of the power plant is scheduled to begin in mid-November. The Engineering firm of Burns and McDonnell is managing the demolition for the Authority. During its October meeting, the Board was advised of a proposal from the City of Lamar of a party interested in repurposing and re-using the North Plant equipment and domes. Discussion on the proposal is ongoing; however, the completion date for the entire dismantling of the Plant remains on schedule for the summer of 2021.

Summary of September 2020 Financial and Operating Statements: During the month of September, revenue from power sales were better than budget by 2.3% and total cost of goods sold were under budget by 5.9%. Net revenue for the month was $256,642. YTD Total Revenues are 4.7% better than budget and cost of goods sold were 0.7% under budget. Net revenues YTD are $3,662,132. Member Energy sales for September were 12.6% less than 2019 and just better than budget. Member Sales YTD are about 6% better than budget.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, December 3, 2020. The meeting notice and agenda will be posted on the ARPA website www.arpapower.org  at least 24-hours in advance of the meeting.

Thursday, October 22nd, 2020

 

 

 

BUSINESS OPERATIONS – OCTOBER 2020

ARPA to Issue a Request for Proposal (RFP) for Power Supply: The ARPA Board of Directors, at its September meeting, authorized the General Manager to engage JK Energy Consulting to develop a RFP for power supply that would begin February 1, 2025, to replace an existing power supply contract that expires January 31, 2025. That power supply contract is with the Public Service Company of Colorado (Xcel Energy) and provides approximately 60-65% of ARPA’s power supply needs. ARPA also has a long-term contract with the Western Area Power Administration for federal hydro-power that provides approximately 35% of its power supply, and member wind generated power rounds out the remaining power supply needs. Results of the RFP could be expected as early as March-April 2021.

ARPA Board Reviews 2021 Budget: The ARPA Board of Directors reviewed its proposed 2021 budget at its September meeting. The proposed 2021 budget includes:

  • Power Sales Revenues of $30.4 million that includes a rate reduction of approximately 3.5%
  • Power Supply costs of $14.0 million
  • Transmission costs of $3.56 million
  • A&G costs of $1.6 million
  • Debt Service costs of $8.3 million

ARPA’s 2021 Budget Hearing is scheduled for December 3, in La Junta at the Otero Junior College Student Center.

ARPA Board Continues to Evaluate its Options to Retire its 2010 Bonds: The ARPA Board received cost projections for Year-End 2020 that indicates ARPA’s ability to retire its 2010 Bonds of $14.8 million. Retiring the bonds will reduce annual debt service cost by approximately $1.25 million. Projections indicate this will allow ARPA to take a decrease in its energy rate of 3.57% beginning in 2021.

Demolition of the Lamar Power Plant Remains On-Schedule:  The ARPA Board received an update on the demolition process for its Lamar Repowering Project. The demolition of the power plant, located at Lamar, is scheduled to begin in late October-early November and be complete by summer of 2021. The Engineering firm of Burns and McDonnell is managing the demolition for the Authority.

Summary of August 2020 Financial and Operating Statements: During the month of August, revenue from power sales were better than budget by 10.8% and total cost of goods sold were over budget by 4.4%. Net revenue for the month was 63% better than budget. YTD Net Revenues are 49% better than budget and cost of goods sold were right on budget. Net revenues YTD are $3,405,491. Member Energy sales for August were 0.5% less than 2019 and 11.2% better than budget. Member Sales YTD are about 6.7% better than budget.

Next ARPA Meeting: The next regularly scheduled meeting of the ARPA Board of Directors is Thursday, October 29, 2020. The meeting notice and agenda will be posted on the ARPA website (arpapower.org) at least 24-hours in advance of the meeting.