[PPT] - BUSINESS REVIEW Jan. 29, 2019 B O N N E V I L L E P O W PowerPoint Presentation

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QUARTERLY BUSINESS REVIEW

Jan. 29, 2019

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

INTRODUCTION

Scott Simms, DIRECTOR OF COMMUNICATIONS

S L I D E 2 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | S C O T T S I M M S

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

AGENDA

S L I D E 3 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | S C O T T S I M M S

Time Presentation Speaker 9:00 a.m. Introductions Scott Simms Director of Communications 9:01 a.m. State of the business:

Environment, Fish and Wildlife updates

Elliot Mainzer Administrator 9:20 a.m. Power Services update Joel Cook Senior VP of Power Services 9:28 a.m. Transmission Services update Richard Shaheen Senior VP of Transmission Services 9:36 a.m. Finance update Michelle Manary Chief financial officer 9:44 a.m. Grid modernization update Nita Zimmerman

Deputy executive VP of Business Transformation Office

9:51 a.m. Upcoming involvement opportunities Scott Simms 9:53 a.m. Question and answer

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

STATE OF THE BUSINESS

Elliot Mainzer, ADMINISTRATOR AND CHIEF EXECUTIVE OFFICER

S L I D E 4 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | E L L I O T M A I N Z E R

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

SAFETY

S L I D E 5 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | E L L I O T M A I N Z E R

0.3 0.4 1.1 0.5 1 1.5 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Incident frequency rate

Number of injuries and illnesses per 200,000 hours worked

2019 Ceiling

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

CRSO EIS PROCESS

S L I D E 7 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | E L L I O T M A I N Z E R

*Dates reflect commitment to the Council on Environmental Quality based on the October 2018 presidential memoranda.

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

FLEXIBLE SPILL

S L I D E 8 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | E L L I O T M A I N Z E R

Flexible spill agreement

– Tests an innovative approach to fish survival while managing costs of hydro generation. – In place while we complete the CRSO process.

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

POWER SERVICES

Joel Cook, SENIOR VICE PRESIDENT OF POWER SERVICES

S L I D E 9 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

POWER SERVICES EXPENSE

S L I D E 1 0 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

Total expense (in millions of dollars) BP-18 Rate Case Q1 EOY forecast Variance Year-to-date 646 607 (40) FY 2019 2,690 2,486 (204)

191 204 212 50 100 150 200 250 300 350 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Power Services total expense

Total expenses in millions of dollars

BP-18 Rate Case Actuals

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

POWER SERVICES REVENUES

S L I D E 1 1 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

Total revenues (in millions of dollars) BP-18 Rate Case Q1 EOY forecast Variance Year-to-date 671 706 35 FY 2019 2,821 2,797 (24)

220 236 250 50 100 150 200 250 300 350 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Power Services total revenues

Total revenues in millions of dollars

BP-18 Rate Case Actuals

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

SNOWPACK CONDITIONS

S L I D E 1 2 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

National Weather Service official water supply forecast as of Jan. 4, 2019

Jan. – July

(million acre feet) Percent average 93.5 92

108% 97% 84% 89% 89% 96% 81% 90% 85% 77% 81% 82% 76%

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

HENRY HUB PRICES

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3.23 4.06 3.94 2.0 2.5 3.0 3.5 4.0 4.5 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Henry Hub prices

In dollars per one million British thermal units

BP-18 Rate Case Actuals (S&P Global Platts)

Jan. 8 NYMEX Average

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

BP-18 forecast: $3.00 FY 2019 average: $2.13

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

MID-C PRICES

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44.24 53.82 51.28 10 20 30 40 50 60 70 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Mid-C heavy load hour prices

In dollars per megawatt hour

BP-18 Rate Case Actuals Forward market (ICE)

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

BP-18 forecast: $22.90 FY 2019 average: $39.50

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

POWER CAPITAL EXPENDITURE

S L I D E 1 5 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

13 30 46 100 200 300 400 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Capital expenditure for fiscal year 2019

In millions of dollars

BP-18 Rate Case Actuals fiscal year-to-date

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

POWER CAPITAL WORKPLAN COMPLETE

S L I D E 1 6 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

Note: Power’s capital work plan completed includes only direct-funded federal hydropower capital projects and spending. 100% 73% Q1 Q2 Q3 Q4 20 40 60 80 100

Percent of capital work plan completed

The percentage of assets completed compared to budget spent

Completed assets Budget spent Planned assets Planned budget

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

FEDERAL HYDROPOWER RELIABILITY

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5.1 5.9 3 4 5 6 7 Q1 Q2 Q3 Q4

Federal hydropower forced outage factor

Percentage of hours fed hydro projects are offline due to unplanned outages

FY 2019 Target

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

Good

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

COLUMBIA GENERATING STATION RELIABILITY

S L I D E 1 8

100 94 92 94 96 98 100 Q1 Q2 Q3 Q4

Columbia Generating Station availability factor

Percentage of time Columbia is available to serve demand

FY 2019 Target Good

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | J O E L C O O K

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION SERVICES

Richard Shaheen, SENIOR VICE PRESIDENT OF TRANSMISSION SERVICES

S L I D E 1 9 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION SERVICES EXPENSE

S L I D E 2 0 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

Total expense (in millions of dollars) BP-18 Rate Case Q1 EOY forecast Variance Year-to-date 259 252 (7) FY 2019 1,067 1,070 3

88 82 82 20 40 60 80 100 120 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Transmission Services total expense

Total expense in millions of dollars

BP-18 Rate Case Actuals

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION SERVICES REVENUES

S L I D E 2 1 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

Total revenues (in millions of dollars) BP-18 Rate Case Q1 EOY forecast Variance Year-to-date 259 252 (8) FY 2019 1,060 1,055 (5)

83 83 86 20 40 60 80 100 120 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Transmission Services total revenues

Total revenues in millions of dollars

BP-18 Rate Case Actuals

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION CAPITAL EXPENDITURE

S L I D E 2 2 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

34 64 94 100 200 300 400 500 600 Oct. Nov. Dec. Jan. Feb. March April May June July Aug. Sept.

Capital expenditure for fiscal year 2019

In millions of dollars

BP-18 Rate Case Actuals FYTD

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION CAPITAL PLAN COMPLETE

S L I D E 2 3 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

67% 71% Q1 Q2 Q3 Q4 20 40 60 80 100

Percent of capital work plan completed

The percentage of assets completed compared to budget spent

Completed assets Budget spent Planned assets Planned budget

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION RELIABILITY - SAIFI

S L I D E 2 4 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

0.43 0.2 0.66 0.68 0.2 0.4 0.6 0.8 Q1 Q2 Q3 Q4

System average interruption frequency index

Tracks frequency of unplanned outages

Low voltage (< 200kV) High voltage (>= 200kV) Low voltage warning level High voltage warning level Good

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

TRANSMISSION RELIABILITY - SAIDI

S L I D E 2 5 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

194 130 430 260 50 150 250 350 450 Q1 Q2 Q3 Q4

System average interruption duration index

Tracks duration of unplanned outages

Low voltage (< 200kV) High voltage (>= 200kV) Low voltage warning level High voltage warning level Good

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

ENGAGE WITH TRANSMISSION

S L I D E 2 6

Reliability coordinator services.
TC-20 proposed settlement and schedule discussions.
Planning work:

– Regional planning organization. – Criticality, health and risk assessments.

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | R I C H A R D S H A H E E N

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

FINANCE

Michelle Manary, CHIEF FINANCIAL OFFICER

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | M I C H E L L E M A N A R Y S L I D E 2 7

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

BUSINESS LINE FINANCIAL HIGHLIGHTS

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | M I C H E L L E M A N A R Y S L I D E 2 8

$24 million

more than expected POWER REVENUES

$5 million

less than expected TRANSMISSION REVENUES

$45 million

less than expected POWER EXPENSES*

$3 million

more than expected TRANMISSION EXPENSES

*Note: Power’s expenses exclude the $159 million expense reduction due to Regional Cooperation Debt refinancing

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

AGENCY FINANCIAL HEALTH

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | M I C H E L L E M A N A R Y S L I D E 2 9

$1,891 $1,840 $1,647 $3,659 $1,502 $3,622 Expense Revenues 1000 2000 3000 4000

Federal Columbia River Power System

Total expense and revenue in millions of dollars

BP-18 Rate Case Q1 EOY forecast Non-IPR IPR

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

AGENCY NET REVENUES

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | M I C H E L L E M A N A R Y S L I D E 3 0

Agency net revenues less Regional Cooperation Debt transactions (in millions of dollars) BP-18 Rate Case Q1 EOY Forecast 274 280

$120 $280

100 200 300 400

FCRPS net revenues

In millions of dollars

BP-18 Rate Case Q1 EOY forecast

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

RESERVES

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | M I C H E L L E M A N A R Y S L I D E 3 1

Coming in the second quarter.

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

GRID MODERNIZATION

Nita Zimmerman, DEPUTY EXECUTIVE VICE PRESIDENT OF BUSINESS TRANSFORMATION OFFICE

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | N I T A Z I M M E R M A N S L I D E 3 2

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

OVERVIEW

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | N I T A Z I M M E R M A N S L I D E 3 3

Grid modernization investments will support:

– More reliable, flexible and efficient systems. – Reduce future costs. – Create new market opportunities.

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

ROADMAP

S L I D E 3 4 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | N I T A Z I M M E R M A N

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

GRID MOD SPENDING

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | N I T A Z I M M E R M A N S L I D E 3 5

1.6 1 15 Q1 Q2 Q3 Q4 5 10 15

Grid Modernization Key Strategic Initiative spending

In millions of dollars

Incremental spent Existing spent Incremental planned Existing planned

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

CONTINUOUS OUTAGE ANALYSIS

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | N I T A Z I M M E R M A N S L I D E 3 6

Collaborative process across BPA to minimize negative

impacts on power and transmission operations.

Advanced planning reduces the number of outages

and likelihood of rescheduling.

Optimizes transmission capacity.

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

PUBLIC ENGAGEMENT

Scott Simms, DIRECTOR OF COMMUNICATIONS

S L I D E 3 7 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | S C O T T S I M M S

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

PUBLIC MEETINGS

S L I D E 3 8

Jan. 30: Distributed energy resources utility cross-

share.

Jan. 31: Proposed TC-20 settlement update.
Jan. 31: Transmission long-term commercial update.
Feb. 5: Regional planning organization efforts.

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | S C O T T S I M M S

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

COMMENT PERIODS

S L I D E 3 9

Feb. 20: Willow Creek Summit and Windy Devil Radio

upgrade project.

March 1: BP-20 Rate Case Initial Proposal.

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9 | S C O T T S I M M S

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QUESTION AND ANSWER

S L I D E 4 0 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9

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B O N N E V I L L E P O W E R A D M I N I S T R A T I O N

THANK YOU

S L I D E 4 1

The next QBR is scheduled for April 30, 2019. Didn’t get your question answered? Email Communications@bpa.gov. Answers will be posted to www.bpa.gov/goto/QBR. The strategic plan is available at www.bpa.gov/StrategicPlan.

B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9

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FINANCIAL DISCLOSURE

This information was made publicly available on

Jan. 28, 2019, and contains information not

sourced directly from BPA financial statements.

S L I D E 4 2 B O N N E V I L L E P O W E R A D M I N I S T R A T I O N | Q B R J A N U A R Y 2 0 1 9