ML14035A313

2013 Annual Financial Report. Part 1 of 2

ML14035A313
Person / Time
Site:	Columbia
Issue date:	01/16/2014
From:	Energy Northwest
To:	Office of Nuclear Reactor Regulation
References
G02-14-007
Download: ML14035A313 (34)

Text

ENERGY NORTHWEST S/

-ai

OENERGY I-N)

Contents 4 A Message to Our Stakeholders 6 The Excellence Model 8 Executive Board 11 Board of Directors 12 Senior Leadership 13 Project Generation 14 Columbia Generating Station 16 Refueling and Maintenance Outage 21 18 Nine Canyon Wind Project 20 Packwood Lake HydroeLectric Project 22 White Bluffs Solar Station 23 Operations and Maintenance 24 Generation Project Development 26 Applied Process Engineering Laboratory 27 Calibration Services Laboratory 28 Environmental & Analytical Services Laboratory 29 Industrial Development Complex 30 Environmental Stewardship 32 Community Service 34 CEO Recognition 35 FINANCIAL DATA & INFORMATION 36 Management Report on Responsibility for Financial Reporting 36 Audit, Legal and Finance Committee Chair's Letter 37 Independent Auditor's Report 38 Energy Northwest Management's Discussion and Analysis 47 Current Debt Ratings 48 Statement of Net Position 50 Statements of Revenues, Expenses and Changes in Net Position 51 Statements of Cash Flows 53 Notes to Financial Statements Energy Northwest 2013 Annual Report

U-n ii U'"i AZ.

[ iscal to year 2013 Excellence was a yearwas inPerformance of records validatedandthrough much both more the for continuing Energy Northwest. Our team's safe, reliable commitment and predictable Under operation of our generation projects, and achievement of a number of performance firsts for the agency.

Budget: Safe operations were demonstrated through our third consecutive year without an accident resulting in lost work time among our more than 1,100 employees and supplemental workers. InJanuary, we set a plant record

$500K for the longest period - nearly one year - without an Occupational Safety and Health Administration recordable accident. These are just the highlights from a year that earned us the American Public Power Association's Operations & national Safety Award of Excellence, recognizing Energy Northwest as first in safety standards among utilities Maintenance with 500 to 2,000 employees.

Reliability means we can be depended upon. In December, Columbia Generating Station joined the

$1. 7 miLLion industry's top performers for equipment reliability and finished the calendar year with the highest ever annual CapitaL production - 9.3 million megawatt hours of electricity to the power grid. Columbia, in fact, was recognized by its peers for substantial performance improvement during the last few years.

Expenditures At the Nine Canyon Wind Project, we installed an energy storage system in partnership with the City of Richland, the Bonneville Power Administration, Powin Energy and Pacific Northwest National Laboratory. The demonstration project will help determine the feasibility of using storage to manage production to a transmission schedule; to comply with over-generation curtailment events; and to shift facility energy production between off-peak and on-peak energy periods.

Predictability instills confidence in the public as well as our employees, and the long list of work we completed in our 21st Refueling and Maintenance Outage to improve equipment reliability was essential to U ACommitment to ExceLlence

helping us meet our goal of achieving predictable performance. Furthering our predictability, our Energy!

Business Services group also completed a $2 million labor contract for operations and maintenance with Seattle City Light at their major hydro projects.

Our fuel purchase agreement with the Department of Energy, U.S. Enrichment Corporation and the Tennessee Valley Authority that began infiscal 2012 will generate tens of millions of dollars in additional rate case savings from 2014 to 2017, and tens of millions of dollars more insavings through 2028. These significant savings during the life of the transaction will enable Bonneville Power Administration to reduce current and Zero: future proposed rate increases - every $40 million in savings over a two-year rate case period equates to Lost Time approximately a 1 percent reduction in rates.

Our successes insafety, reliability and predictability have their roots in Excellence in Performance, which you Accidents can learn more about on the next pages. Initiated in 2011, it now touches everything we do as an agency. As we enter Phase IIIof this initiative-Achieving Excellence- we stay focused on building a culture of continuous OSHA improvement across the agency.

RecordabLes Keeping our existing projects operating reliably and cost effectively, while meeting members' future energy needs, remains Energy Northwest's foundation. We're working to set the stage for small modular reactors in Washington state. We also strongly support efforts to locate SMRs near Columbia to provide members with options for baseload power during the post-2025 years and continue to look for land we can set aside to build renewable projects to meet our members' post-2015 renewable portfolio standard energy requirements.

Our employees drive these successes and our vision; they are the essential element to achieving our mission.

The Energy Northwest team once again stayed within our long-range plan commitment. We ended the year under budget by half a million dollars in operations and maintenance and $1.7 million incapital expenditures, underscoring our dedication to fiscal discipline and responsibility for the benefit of Northwest electric ratepayers.

Finally, our sincere thanks to all Energy Northwest team members who volunteered their time and talents to support needs within our communities, through March of Dimes, Head Start, United Way, Red Cross and many other community organizations. Our employees demonstrate a strong commitment to not only our stakeholders, but also to the communities inwhich we live and work - and that's why we're so honored to work with this team each day. We are extremely proud of their efforts.

Together we are making progress on all our initiatives, and proving our commitment to excellence to the industry, our peers and the community. While we still have a long road ahead, we are confident in our team's desire to be the standard by which others measure excellence.

Respectfully, Sid Morrison Mark Reddemann Chair, Executive Board Chief Executive Officer

The EXCELLENCE Model A The model's visual appearance includes four interdependent tiers that build on the preceding tiers' strengths. Its foundation is based on four principles that are key to establishing and maintaining a workplace environment that leads to and sustains desired behaviors. The model is a proven blueprint to pursue performance excellence opportunities and realize sustainable performance excellence results.

The Excellence Model's Principles:

The Right PeopLe The Right Coaching Selecting and retaining the right people ensures each employee Ensuring the right workforce coaching and engagement is the most has the right skills, knowledge and behaviors required for the job. It important role of leadership, and involves providing individuals positive also builds appreciation for workforce diversity. and constructive guidance needed for performance improvement.

Leading by example and providing anecdotes are effective coaching The Right Picture methods, and positive reinforcement of desired behaviors is the best Communicating and reinforcing the right picture aligns and way to get those behaviors repeated. Performance measures, the engages all employees with agency standards and goals. It involves performance appraisal process, ACEMAN and trend data provide early team and individual goals that align with the model's multi-tiered indication of performance results. These elements are also cues for structure. supervisory oversight and involvement.

The Right Process Individual Exceltence (ACEMAN)

The right processes lead to improved performance and ensure Individual Excellence, or ACEMAN, specifies individual results processes are effective and efficient. Achieving the right processes that constitute individual and site excellence. The letters inACEMAN lower agency costs and increase productivity. represent six critical attributes developed to show how daily activities and daily individual results relate to achieving top performance. The attributes are listed on the opposite page.

c........m..p...e......................................................................................a.....

.................... .. a. ..............................................

Effective implementationof the Excellence Model, with all its elements, will ensure these principles areestablished and followed throughoutthe organization.

U A Commitment to Excetlence

SID MORRISON JACK JANDA Chair Vice Chair Outside Director Inside Director Zittah, Wash. SheLton, Wash.

Sid Morrison was appointed to the Jack Janda was elected to the Mason executive board in July 2001 by the County Public Utility District 1 Board of Energy Northwest Board of Directors. He Commissioners in 2001. Commissioner served as chair of the Energy Northwest Janda was appointed to the Energy Operations, Construction and Safety Northwest Board of Directors in January Committee from 2003 to 2006 and 2003, and recently re-elected to serve was re-appointed to serve another term another six-year term. He was elected on the executive board in 2005. In by the board of directors to serve on the June 2006, he was elected chair of the executive board in January 2005. In April executive board, and reappointed in 2010, he was re-elected to serve another June 2013. term on the executive board. Additionally, Mr. Morrison is a former legislator he is vice chair of the executive board serving in the Washington State House and has served as secretary/treasurer, of Representatives from 1966 to 1974, vice president and president of Columbia the Washington State Senate from Generating Station Participants Review 1974 to 1980 and the United States Board.

House of Representatives from 1980 to Commissioner Janda represented 1992. He was appointed as secretary Mason PUD 1 on the Washington Public of transportation by the Washington Utility District Association and has served Transportation Commission in 1993 on the WPUDA board as secretary/

and served in that capacity until retiring treasurer, vice president and president.

from state service in 2001. He is also He also served as first chairman of the the chairman for the board of trustees WPUDA Energy Committee in 2008.

at Central Washington University and Prior to his election, Commissioner the chair for the Yakima Basin Storage Janda was employed with the Forest Alliance. Service and retired after 32 years of service. He is a member of Mason County Fire District 1 and served as its chief for 10 years. He has also served as a past board member of the Mason County Tourism Council and a past member of the Hood Canal Salmon Enhancement Group.

KATHY VAUGHN DAVE REMINGTON MARC DAUDON DAN GUNKEL Secretary Assistant Secretary GubernatoriaL Appointee Inside Director Inside Director Gubernatorial Appointee SeattLe, Wash. GoldendaLe, Wash.

Lynnwood, Wash. Spokane, Wash.

Kathy Vaughn was the first woman Dave Remington was appointed to Marc Daudon was appointed to the Dan Gunkel was elected elected to the Snohomish County Public the Energy Northwest Executive Board by Energy Northwest Executive Board by commissioner of the Klickitat County Utility District Board of Commissioners, Gov. Gary Locke in December 2004, and Gov. Chris Gregoire in 2011. He is the PUD in 1991. He was appointed to the Commissioner Vaughn was appointed was re-appointed by Gov. Chris Gregoire principal and co-founder of a consulting Energy Northwest Board of Directors that to the Energy Northwest Board of in 2009 and by Gov. Jay Inslee inJune group with more than 25 years of same year and was elected to the Energy Directors in 2004 and served as its vice 2013. He is currently assistant secretary international environmental consulting Northwest Executive Board in 1994. In president from 2005 to 2007. In April of the executive board and chair of the experience, with expertise inthe fields April 2006, he was re-elected to serve 2006 she was elected by the board of Compensation Subcommittee. of sustainability, resource conservation, another term on the executive board directors to the executive board and was Mr. Remington is retired from his waste management, energy, climate and was appointed chair of the Energy re-elected inApril 2010. She served as position as senior vice president and chief change and strategic planning. Northwest Operations, Construction and the assistant secretary until 2008 when financial officer of a public company that Prior to that, Mr. Daudon created a Safety Committee in June 2006.

she was selected as secretary. In January, provides hardware and software systems Seattle-based mail order business, served Commissioner Gunkel is co-owner!

she was appointed chair on the Energy used by both utilities and customers. He as a consultant inAfrica on energy issues business manager of a medium-sized fruit Northwest Executive Board's Audit, Legal has more than 35 years of experience and worked in a Somali refugee camp. orchard, which enables him to sufficiently and Finance Committee. incorporate finance, treasury and He is chair emeritus of the board of represent irrigators in Klickitat County.

Ms. Vaughn also serves on the Policy investment banking services where he Washington Conservation Voters and also He sought the commissioner position Makers Council for the American Public specialized in private debt and equity serves on the board of the Washington because of a commitment to public Power Association to work on national transactions, including project financing. Environmental Council, service, but he also has an interest in energy policy issues inWashington, D.C. Before that, he was president of a seeing the PUD provide quality service.

She is an accomplished businesswoman financial corporation where he also held and is the president and licensed positions as executive vice president and broker of a Washington state mortgage vice president of finance.

brokerage firm. She is also co-owner of a Mr. Remington serves on the board of construction company with her husband. a non-profit organization that established a science center in eastern Washington and an angel fund. He also served as an Army Reserve officer.

Energy Northwest 2013 Annual Report U

SKIP ORSER WILL PURSER LORI SANDERS TIM SHELDON Outside Director Inside Director Inside Director Outside Director Raleigh, N.C. Sequim, Wash. Kennewick, Wash. PotLatch, Wash.

Skip Orser was appointed to the Will Purser has served as Clallam Lori Sanders became a Benton State Sen. Tim Sheldon was Energy Northwest Executive Board in County PUD commissioner since April County PUD commissioner inJanuary appointed by the Energy Northwest April 2010. 2001. He was appointed to the Energy 2005. Board of Directors to serve an unexpired His background includes more than Northwest Board of Directors in April She was elected to the Energy term on the executive board in October 30 years of experience with nuclear 2008 and elected to the executive board Northwest Executive Board in April 2010 2003. He was elected to a second term energy, most recently serving as interim in June 2010. and her four-year term began in June in June 2004. He served as assistant chief operating officer at Tennessee Valley Commissioner Purser has spent nearly 2010. She was appointed to the Energy secretary to the executive board from Authority. 30 years in the energy (oil and gas) Northwest Board of Directors in January 2004 to 2006. In June 2006, he was Mr. Orser previously served as group industry. His career includes responsibility 2005 and was elected secretary in appointed to chair the Administrative and president of energy supply with Progress for capital-intensive and technical January 2007, and again in June 2013. Public Responsibility Committee. In June Energy, executive vice president and chief projects in the U.S. and internationally, Commissioner Sanders is the owner 2008 he was re-elected for another four-nuclear officer at Carolina Power and such as deep-water offshore facilities, and president of a consulting firm on year term on the executive board. He was Light Co., and executive vice president liquefied natural gas terminals and large conservation and renewables. She is a once again re-elected to a four-year term and chief nuclear officer at Detroit Edison Public Utility Regulatory Policies Act Kennewick, Wash., native and brings 25 that began in June.

Co. His career began in the Navy with power generation facilities. years of experience as a small business Sen. Sheldon was a Mason County service aboard three nuclear submarines. Commissioner Purser has negotiated owner to her post. PUD 1 commissioner from 1992 to 2002.

Mr. Orser holds a bachelor's degree power sales agreements with major He served as the executive director in naval science from the U.S. Naval investor-owned utilities and intervened in of a non-profit corporation dedicated Academy and a master's degree in electrical rate cases before various state to assisting startup businesses. His computer systems management from the public utility commissions. AVietnam-era economic development expertise includes Naval Postgraduate School. veteran, he is active in public power and work with Northwest Indian tribes.

community service organizations. Sen. Sheldon is the general partner in a family-owned, 500-acre tree farm on the Olympic Peninsula.

As senator for the 35th District, he represents all of Mason and portions of Grays Harbor, Kitsap and Thurston counties. He serves on the Transportation Committee and the Legislative Transportation Committee. He was elected to the Mason County Commission in 2003 and re-elected in 2007.

M A Commitment to Excetlence

lllj: 0 1!l:

I 12 lakli: II" Project GENERATION Energy Northwest 2013 Annuat Report

SE'ISI 0 el a lk I I ' Inl IN

olumbia Generating Station is a boiling water reactor, using nuclear fission to heat water into high pressure steam. The steam spins turbines that are connected to a generator making emissions-free electricity. Columbia demonstrates Energy Northwest's commitment to developing environmentally friendly, powerful solutions.

Electricity produced at Columbia is provided, at-cost, to the Bonneville Power Administration, which delivers the power to utilities throughout Washington and other western states as necessary.

Columbia is committed to excellence and begins the new fiscal year with a continued focus on performance and results.

Columbia's continued operation is the most socially and fiscally cost-effective _ C C .

option for consumers. Er 'E: E 'E

- Brent Ridge, Vice President, N ~

Chief B Financial & Risk Officer e 4r Net Generation - MWh U

RefueLing & Major R-21 Projects:

Maintenance Replacement of 36 control rod blades

" Maintenance performed on 17 - 480 volt transformers OUTAGE 21 Maintenance performed on 20 - 480 volt motor control center buckets Replaced or refurbished three large motors and one feedwater

• efueling and Maintenance Outage 21 began May 11, drive turbine LD 2013, and ended June 25 with Columbia's reconnection to the Performed program preventative maintenance and/or testing Northwest power grid. The plant is refueled every two years, and the on more than 300 valves down time is used for corrective and preventative maintenance, Performed turbine maintenance and removed one low pressure equipment upgrades and repairs that cannot be done while the plant turbine rotor for inspection; inspected the other two rotors for cracks is producing power.

" Performed eddy current testing on 11 feedwater heaters Refueling outages are scheduled in the spring, when the need for the plant's 1,170 megawatts of power - enough to supply a city the Completed 1,552 preventative maintenance work orders size of Seattle - is lower than normal. Demand for electricity drops Performed more than 200 surveillance procedures with mild spring weather and hydropower abundance. Performed 474 maintenance work orders M A Commitment to Exce[lence

James Sauceda has worked at Columbia i

Generating Station for nearly four years as a component engineer in Technical Services Engineering, supporting pumps and vibration monitoring. He received a CEO Recognition Award, for his contribution to the first-time replacement of one of our three residual heat removal pumps just priortoRefueling and Maintenance Outage 2L.

r.  ;.

% "I

NNANYS NineCanon Wnd rojet i on ofte lrges pulic owne pojecs wid i th naion.Wit 63win

228,227 net megawatt-hours of electricity sent to the power grid U iscal year 2013 produced 228,227 net megawatt-hours of electricity, and achieved a 98.9 percent adjusted availability factor, up from 98.6 percent in fiscal 2012. Nine Canyon reached its 10th year of renewable energy production during fiscal year 2013, and produced its two millionth megawatt hour in December 2012.

Nine Canyon is aligned on the hilltops southeast of Kennewick, Wash., and the turbines are positioned to take advantage of persistently strong winds along the Columbia River Gorge. The turbines convert those winds into electrical energy.

Each turbine has its own miniature weather station that monitors wind direction and speed. Motors atop the turbines rotate the turbines into the wind. Sophisticated control systems ensure the blades turn at the optimal speed to produce electricity.

The turbines are self-starting and begin generating electricity when wind speed reaches eight miles per hour. Generation increases as the wind speed increases, with full power achieved at about 35 mph. If winds exceed 55 mph on a sustained basis, the turbines shut down automatically by pitching the blades to a stopped position while engaging a large disk brake and restart when the winds fall below 45 mph. The pitch of the blades is automatically adjusted to maximize power generation from the available wind.

With a vision to be the region's leader in energy generation, Energy Northwest partnered with Walla Walla Community College to host the state's first wind energy technician training program at the M M 1 4 community college level, which will increase the availability of a local O N D to C4 C6 C~l -q CD ,.-.

CD dCl skilled workforce to enter the growing wind energy job market.

C4 04 C4 C4 FY FY Net Generation - MWh Energy Northwest 2013 Annual Report

alA SI.I

I] I A

4,597,249 0 Packwood Lake was formed El Water from the lake enters El The structure feeds water into El Water reaches the when a large mass of soil and a concrete intake structure a six-foot diameter underground powerhouse with approximately rock slid off Snyder Mountain located approximately 424 feet pipe that carries water five mites 780 pounds per square inch of and dammed Lake Creek. The downstream from the lake outlet. while dropping 1,800 feet in pressure at the turbine. The lake's elevation of 2,857 feet lies elevation before delivering water water spins the turbine generator approximately 1,800 feet above to the powerhouse near the town at 360 revolutions per minute the powerhouse. of Packwood. producing up to 27.5 megawatts of electricity.

Ul After passing through the turbine, water is discharged to the Cowlitz River through a 6,670-foot tailrace canal. A fish screen at the entrance to the Cowlitz River prevents migrating fish from entering the Packwood facility, Intake Building Powerhouse Surne Tank

T

/i

Energy Northwest provides technical support for its members in the areas of operations and maintenance of power generating facilities, as well as electric utility automation.

uring fiscal year 2013, Operations and Maintenance Services engaged the agency's member utilities ID with solutions for supervisory control and data acquisition systems, power plant optimization and development of the technical specifications for a demand response control network. The program is intended to create a transmission grid scaled load balancing resource based on real-time management of residential, commercial and industrial electric loads.

Energy Northwest continues to provide operations and maintenance services to Olympic View Generating Station, which is owned by Mason County Public Utility District 3. Olympic View is comprised of two 2.8-megawatt generating units powered by natural gas-fired reciprocating engines. The plant may be operated remotely, depending on load requirements.

Operations and Maintenance also provide project management, project engineering and craft labor support for the agency's members' power generation projects. During fiscal year 2013, Energy Northwest provided project support for Seattle City Lights' Boundary Hydroelectric Project and Grant Public Utility District's Priest Rapids and Wanapum Hydroelectric Projects.

Energy Northwest 2013 Annual Report

c]i:1 II D Ik7A 9 181 LI Energy Northwest works with its members to understand and anticipate their resource needs, identify regional generation supply opportunities and develop appropriate low-cost resources. The goal is to offer competitive generation supply options and energy solutions to meet member utility needs.

To better address member needs, the agency has increased its focus on energy management initiatives such as energy storage and demand response.

Energy Storage Katama Energy Center The Generation Project Development team successfully installed Citing poor market conditions for new natural gas resources in and began operating a 500 kilowatt-hour energy storage system at the region, Veresen U.S. Power elected to discontinue funding of the the Nine Canyon Wind Project in April. The portable battery storage Kalama Energy Center in April. Energy Northwest immediately placed system concept was developed by Powin Energy, an Oregon-based the project on hold to minimize development costs until a new partner company. Energy Northwest is working with several partners, including or alternative plan is identified to move the project forward.

Powin Energy, Bonneville Power Administration, Pacific Northwest National Laboratory and the City of Richland, on the deployment and Renewabte Energy Resources testing of the energy storage system in the Tri-Cities area. Energy Northwest is committed to identifying low cost and low The overall goal of the project is to validate operability, reliability risk resource development options. The agency continues to evaluate and durability of the energy storage unit; and then to evaluate multiple regional renewable energy sites and partially developed projects to energy storage applications and determine their relative value to the determine their viability in meeting member utility needs.

electric grid and regional utilities. One application currently being Banking renewable projects for future development in anticipation analyzed is the ability to integrate intermittent renewable energy into of Washington's 2016 and 2020 renewable portfolio standard the electric grid by storing and releasing excess energy to optimize compliance obligations enhances value to member utilities through energy production. Other applications include electric distribution the benefits of shortened development schedules and reduced costs.

system support and industrial and commercial customer support. During fiscal year 2013, development efforts were concentrated mainly on wind and solar resource opportunities in the region.

Demand Response In fiscal year 2013, Energy Northwest assembled a team of public Grays Harbor 50-megawatt Power Catt Option power utilities, industry representatives and technical advisors to The agency's call option on the Grays Harbor Energy Center expired develop an aggregated demand response program for the Northwest. at the end of fiscal year 2013.

This large-scale public power program is designed to vary utility loads or the output from small regional generators on demand to allow a better balancing of loads and resources in BPA's balancing authority.

Demand response anticipates the use of technically-advanced infrastructure to efficiently assemble the region's existing smart grid, demand response assets and other investments into a capable, cost effective and well-coordinated resource.

il

APPLIED PROCESS ENGINEERING LABORATORY isthe Process "launch pad" the Applied nergy Northwest offers Engineering Laboratory as a lease facility for laboratory- to Leverage based research and development. The Pacific Northwest National Laboratory is an anchor tenant, and is joined by regionaL IsoRay Medical, Inc., which attained anchor tenant status during fiscal year 2013. Approximately 20 percent of the iecinotogicai facility is dedicated as a business incubator, supporting start-up and acceleration of new technologies and technology- expertise into based businesses. APEL fills a community need for business starter space and provides suitable environments for controlled s testing of advanced processes.

District Located in the heart of the Tri-Cities Research Innovation Partnership Zone, APEL is the "launch pad" to ventures leverage regional technological expertise into early stage entrepreneurial ventures. By creating an environment rich with resources, technical assistance and connections to potential partners and customers, APEL fosters collaboration in innovation and commercialization.

In fiscal 2013, APEL continued its mission of providing spaces for tenants as well as offering options for businesses and researchers with intermittent needs. Supporting companies that do not need physical space on an ongoing basis creates additional exposure for business - both the entrepreneurs and their products - within the APEL community.

Major institutions in the Tri-Cities support and sponsor APEL including Energy Northwest, the Port of Benton, the Department of Energy, Washington State University Tri-Cities, Pacific Northwest National Laboratory, the city of Richland and the Tri-Cities Industrial Development Council. APEL's operating costs are covered by tenant rent.

M ACommitment to ExceLLence

II1 III

Environmental

& Analytical Services LABORATORY In support of Energy Northwest's ISO 14001 Environmental W Environmental or more than and Analytical 15 years,Services EnergyLaboratory Northwest's has Management System commitment, the laboratory provided chemical analysis and environmental monitoring monitored noxious weed populations and controlled these expertise for utility, municipal and residential customers. The populations primarily through the use of species specific laboratory continues to maintain accreditation for insects. Additionally, as part of the Migratory Bird Habitat wastewater, drinking water, and radiochemical analyses and Enhancement Plan, artificial nest sites were installed during licensure as a clinical laboratory for drugs-of-abuse fiscal year 2012 for the burrowing owl, a "species of concern" screenings. listed by Washington state. Monitoring during fiscal year Services provided to Columbia Generating Station and 2013 indicated that burrowing owls use the artificial nests.

outside clients include metals quantification, general Laboratory employees continue to perform key chemistry, microbiological testing, radiological monitoring, environmental assessments at the Shepherds Flat Wind lubricant condition monitoring, material verification, Farm, located in north-central Oregon. Owned by Caithness commercial grade dedication of materials, and aquatic Shepherds Flat, LLC, of Sacramento, Calif., the project's and terrestrial monitoring. This includes working with the 909-megawatt capacity makes it the largest wind generation Washington Geological Survey, as part of a Department of facility in the United States. Involvement with the project Energy geothermal grant and an Energy/Business Services began in 2002.

financially-supported project to participate in the chemical The laboratory staff was involved with educational analysis of mineral springs samples collected throughout the outreach in the Tri-Cities including presenting to Delta High state of Washington. School students, serving as judge for the "Future Cities" The Radiological Environmental Monitoring Program competition at Ochoa Middle School and participating for Columbia, operated by the laboratory, independently in the annual Science Technology Engineering and Math assesses the radiological impact of Columbia's operation. conference. With the laboratory's participation, students The REMP lab collects and analyzes air, water and agricultural learned about analytical chemistry testing, careers in samples to ensure any operational environmental impact is environmental science and the importance of clean energy.

known and quantified.

M ACommitment to Exce[tence

ilhe Industria eeomn ope s loae justopen I Energy Northwest. A leasing business line was developed to utilize the outlying buildings at the IDC for use as office and warehouse space, as well as former power facilities.

Energy/Business Services continues to manage the leasing business line at the IDC. The tenants based at the IDC are primarily involved in the ongoing construction efforts at the Department of Energy's Hanford Site. A significant challenge the IDC faced during fiscal 2013 was maintaining a positive margin in leasing as the federal government made drastic funding cuts to several tenant contractors.

Energy Northwest also plans to continue looking at ways to efficiently remove unused infrastucture to reduce short- and long-term costs to regional ratepayers.

the ot a ed

$862,000 Energy Northwest 2013 Annual Report M

ENVIRONMENTAL Stewardship nergy Northwest's Environmental Management As a result of a challenge from CEO Mark Reddemann, System is designed to meet rigorous requirements of EMS established a goal to achieve a 7.5 percent reduction the globally recognized International Organization for in carbon dioxide emissions at Columbia from fiscal year Standardization 14001:2004 standard, with additional 2011. With a significant reduction in the vehicle fleet and emphasis on compliance and pollution prevention. Energy replacement of diesel-powered portable security lighting Northwest's EMS was registered to ISO 14001 in April 2005 - with hard-wired light stands - Columbia achieved a 39 by NSF International Strategic Registrations, an accredited percent carbon dioxide reduction from the base year.

registrar. The Environmental and Regulatory Programs department During fiscal year 2013, Energy Northwest established and identified pollution-prevention opportunities and exceeded environmental targets for reductions of hazardous implemented them in fiscal 2013. The most successful results waste generation, mixed waste generation and prevention came from the elimination of microfilm photo processing, a of hazardous material spills at Columbia Generating Station. major contributor to the agency's hazardous waste volume in the past.

Energy Northwest has reduced house loads, fUel consumption, C02 generation and has supported wildlife improvement efforts on our leasedlands.

We are committed to ISO 14001 and to the practice of responsible environmental stewardship.

- Dale Atkinson, Vice President, Employee Development and Corporate Services

ENERGY "NoRTHWEST

/

II

COMMUNITY Service One of the community and educational outreach opportunities Energy Northwest undertook was a series of public service announcements focusing on nuclear energy. The PSAs featured

$90,214 agency members delivering messages about nuclear energy's raised for clean and safe power generation and other benefits.

United Way

$29,000 United H~ Iead Startr raised for Way ~ )

March of Dimes E ACommitment to Excellence

4lorthwest employees spoke to a wide range of March of Dimes es, including many civic and business organizations, Energy Northwest's team raised $29,000 this year for the March iergy Northwest Speakers Bureau. of Dimes, exceeding the goal, and once again demonstrating

Energy Northwest has been a member of the local the philanthropy and generosity of its employees. More than ess community for more than 50 years. As a major 50 walkers from Energy Northwest, along with their spouses, children nployer, the agency strongly believes in the importance and pets, participated in the 3.1-mile walk along the Columbia River the communities and non-profit agencies where its in the 2013 Tri-Cities March for Babies event supporting neo-natal rk and live. birth centers and local families in need.

EO to the newest employee, Energy Northwest cares Additionally, Energy Northwest's dedicated employees provided

,hands-on involvement. more than $10,000 for the "celebrity chef" event sponsored by the officially sponsors three vital community organizations: March of Dimes. These efforts provide national support for research ead Start and March of Dimes. for healthy babies and local support for expectant mothers.

Head Start r2013, more than $90,000 was raised for United Way. In fiscal year 2013, Energy Northwest celebrated the ow 222 Energy Northwest employees contributed to 32nd anniversary of supporting the Benton Franklin Head Start Led Way campaign. These pledges and others help program (since 1980).

eals to elderly neighbors, fund youth developmental Each year, Energy Northwest commits to adopting every Head vide disaster relief planning for the community and Start child for the holiday season.

,m in at-risk youth. Each child provided a wish list to Santa and received at least one improves lives in the community through Community toy and one clothing item. The gifts were distributed by Energy goal is for everyone living in Benton and Franklin Northwest employees, dressed as Santa and his elves, during the we a good education; access to healthcare; to live various Head Start parties.

safe environment; and to be a self-sufficient, active The Head Start program is the most successful, longest-community. running, national school readiness program in the U.S. It provides comprehensive education, health, nutrition and parent involvement services to low-income children and their families.

More than 25 million preschool-aged children have benefited from Head Start, and the number of children served in Benton and Franklin counties has more than doubled in the past two decades.

Energy Northwest 2013 Annual Report

II Sabrina Absolon Gina Harper Robby Robert Alexander Bob Harris Scott F Paul Allen Richard Hatten Randa Greg Armatrout Jeremy Hauger Don Q Dale Atkinson Bryan Hays Kelly R Steve Baker Mot Hedges Angel Marianne Banta Rick Hermann Mark F Brad Barfuss Michael Holle Cristin I Susan Barwick Carole Bergara Kevin Huber Dallin Hunt Mark F Georgi Brittany Bergsson Brenda Ingalls Brent I Eddie Bickett John Irvan Eric Rc Scott Black Alex Javorik Darin I Charles Blake Kathy Jerrow Ross R Mike Boddy Carolyn John Brian F PT Boler Joshua Jones Diego Barbara Bomotti Sandra Jorgensen Richar Pam Bradley Steve Keltner James Denise Brandon Michael Kennedy Bob S(

Daryl Breard Michael Kinmark Jeff Sc Tracey Brown Dean Kovacs Sherri Dave Brown Marlene Ladendorff Richar, Dean Butler John Lamendola Chris I Jon Cohen Andy Langdon Angeli Greg Cullen John Latta James Shannon Dado James Leiren Cherie Michael Davis Pattie Lilly Kyle Sl John Dobken Greg Lisle Ben St JoAnna Dobson Aaron Lyle Diego James Dorwin Clay Madden Dave Jerry Droppo Kyle Martens Pete Tý Elmer Dumlao Carla Martinez Richar Zach Dunham Donna McCauley Michai Bob Dutton Kevin McCullen Scott I Dick Ehr Heather McMurdo Steve Pat Ellsworth Troy McNabb Linda\

Tom Erwin Steve McNutt Jim WZ IN-PROCESSING COORDINATOR Lisa Escalera Angel Melendrez Brent \

Val Eveland Scott Metzger Kennel Brenda Ingalls is Energy Northwest's outage In-Processing Coordinator. John Fellman Daniel Morris Gary V She in-processed 1,247 employees and contractors between March 18 and Terra Flores Toni Munder Nancy Jacque Fuller Theresa Neidhold RonW May 20 this year to support Refueling and Maintenance Outage 21.

Kathleen Galioto Randy Nelson Williar Originally from Prosser, Wash., Brenda joined Team Energy Northwest in Gary Gardner Terry Northstrom Lisa W July 2006. Her primary responsibilities incLude coordination of badging and Jim Gaston Rochelle Olson Rod W training requirements for employees and contractors requesting unescorted Jeff Gloyn Rick Olson Jeff W access to Columbia Generating Station and other Energy Northwest faciLities. Carl Golightly Jerry Paetel Larry V Dwayne Gregory Lynne Pagel Nick \A Tim Hancock Mike Paoli Desire, Greg Hanson Christoper Payne Janet1 Candy Harmon Bruce Pease M