HomeMy WebLinkAboutAgenda Packet - June 26, 2006 - UB AZUSA
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LIGHT 6 WATER
INFORMATION ITEM
TO: HONORABLE CHAIRPERSON AND MEMBERS OF THE AZUSA UTILITY BOARD
AND AZUSA CITY COUNCIL
FROM: 1 OSEPH F. HSU, DIRECTOR OF UTILITIES L2T iL tg-71
DATE: JUNE 26, 2006
SUBJECT: QUARTERLY FUEL COST ADJUSTMENT FOR SAN JUAN RESOURCE
On July 26, 2004, the Utility Board approved a fuel cost adjustment mechanism for San Juan
power plant. This mechanism is intended to credit customers with cost savings that are
realized when our power plant operates reliably and replacement power costs are avoided,
and conversely, allow the Utility to increase revenues to recover a portion of our replacement
power costs when the San Juan resource experiences outages.
This report encompasses replacement power costs incurred for the San Juan resource during
the period of March 16, 2006 through June 15, 2006. There will be a Fuel Cost Adjustment of
0.81 cents per kWh on customer electric billings for the billing period of July 1, 2006 through
September 30, 2006.
The San Juan unit #3 availability during the period of March 16, 2006 through June 15, 2006
was 66% substantially lower than the budgeted availability of 85%. The lower availability is
expected and mainly due to the scheduled maintenance outage from March 31 through April
26 idling the unit completely. Excluding the effect of scheduled maintenance, the availability
would have been 92%. The cost of replacement power as about 10% higher than the
budgeted cost ($44/MWh actual vs. $40/MWh budget). The total replacement power cost
incurred above the budgeted amount for the period is $614,739 for quarterly fuel cost
adjustment recovery. The Fuel Cost Adjustment rate will be 0.81 cents per kWh or about 7%
of the retail rate. This rate will be applicable for electric bills rendered commencing July 1
through September 30, 2006.
Prepared by: Bob Tang, Assistant Director of Resource Management
Attachmenti( d1) �j}
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SJ_FCA_cak Q306.
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114
San Juan Fuel Cost Adjustment Calculation for Q3 2006
Mar 16-April May June (*)
Actual SJ Output 12,387 18,891 9,653
Actual SJ Replac Energy Cost $868,417 $85,191 $40,686
Maximum Output 31,987 20,832 10,440
Unavailable SJ Output 19,600 1,941 787
% Outage Rate 61.27% 9.32% 7.54%
Base SJ Output @ 85% 27,189 17,707 8,874
Unavailable SJ Output 4,798 3,125 1,566
% Outage Rate 15.00% 15.00% 15.00%
Base SJ Replac Energy Cost @$40/MWh $191,922 $124,992 $62,640
Actual- Base SJ Replac Energy Cost $676,495 -$39,801 -$21,954
San Juan Insurance Premium Recovery $0 $0 $0
San Juan Insurance Payout $0 $0 $0
Cumulative Quarterly Difference (CQD) $614,739
Q3 2005 Carry-Over
If KCQD)I<$100,000, then adjustment=0
If KCQD)I>$750,000, then adjustment=+-$750,000
or else adjustment= CQD $614,739
July August September
Forecast Retail Sales(MWh) 25,648 25,233 25,116
SJ FCA for Q3 2006 (cents/KWh) 0.81
(*) Through June 15th, 2006
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