ML20055A387
| ML20055A387 | |
| Person / Time | |
|---|---|
| Site: | Comanche Peak  |
| Issue date: | 07/06/1982 |
| From: | TEXAS MUNICIPAL POWER AGENCY |
| To: | |
| Shared Package | |
| ML20055A370 | List: |
| References | |
| NUDOCS 8207160240 | |
| Download: ML20055A387 (28) | |
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WIISTICA!. lilGill.IGifTS r the years ended Septernber 30, 1981 and i')So 1981 1980 ilities bbons Creek plant completion 78'?! 4597 ,manche Peak Station completion 78'); 759f knite resources (millions of tons) 117' 79 anci.d Infirnutier al revenue bonds outstanding $850,000,000 $850,000,000 frage annual debt scruce $ 70,725,000 S 70,725,000 frage borrowing tost for issues outstanding 7.5 Mf 7.5 %E ,erest earned on investments S 47,695,000 S 36,070,000 nd ratmg - Nhxxfy's/ Standard & Piw>r's A/A + A/A + k tYic .8) Attin t energy for load (kWh sales,000) 2,631,596 2,583,747 ik demand ( AlW) 637 628 stomers 86,822 81,385 rings scalued through economic dispatch S 772,310 S 486,722 il estimate based on new criteria Coter Photo: e Texas 51unicipal Power Agency is a sepa- A rinc of the Gibbons Creek municipal wrporation, a poiitical sub- plantfrom acroff the cm/ing ision of the state .md a body pohtic and nfermir. The p/.<nt ua; 85cf porate. It was established in 1975 by the comp /cte in Daon/ar 1981. les of Bryan, Denton, Garland and Green-le to jointly plan, tinance, construct and trate elettrical pencration and transmission ilities to meet their energy needs. m
A VISIT WITil TiiE PRESIDENT members, and my job is to facili-Following are excerpts from an in. tate that process, to make sure everyone
,terview with W. F. (Ilill) Elkins, mayor gets a fair hearing. The only way to of the City of Greenville and presi. do that is to remain involved and in-
' dent of the TAIPA Iloard of Directors. f rmed, and I'm committed to spending a great deal of time at What major changes hate taken place 79;, ;09, in the Agemy oier the past year?
. . Are you satisfled uith Ihis years progress?
Elkins .The most important change is our increased emphasis on Gibbons Elkins: Absolutely! Compared to similar Creek Unit No.1. 'Ib get the plant built pmjects, our performance is very and operating as soon as possible, good, and over the past few months, I'd we moved several of our top managers give it an A + . Recently we exam-and virtually all of our engineering ined trends in fossil power plant con-staff to the plant site. Joel Rodgers, our struction schedules and found that former general manager with 30 the range for units beginning operation years of experience in building power in 1983 is 54-60 months. Our plants, is now directly in charge schedule now stands at 56 months. of construction This year there utre cost and schedule in-Can pu be more specific about u hy pu creasespr Gibbons Creek. Wouldyou altered the management structure? explain briefly uhat caused those increases?
- Elkins: The Gibbons Creek Project, in- Elkins Although it's easy to blame infla-c iuding the plant, mine and associ. tion and high interest rates, that's
. ated transmission facilities, is a big job. not the whole story. In the case of Gib- ! Alany significant milestones will bons Creek, we had problems ob-occur in the final year befbre start-up. taining design releases, coupled with Augmenting our construction man, delays in equipment delivery and agement team is appropriate to assure the need to order more materials than that the project is completed we anticipated. on time. Every new power plant project is a We are searching for a new general man- learning experience. With the benefit ager, and I am more actively in. of 20-20 hindsight, I see how we might volved than usual in the decision. have done some things differently. making at the Agency. I'm pleased to On balance the project has proceeded say that everything is running satisfactorily, and the rate of pro-smoothly, primarily because we have gress is improving continuously. such a dedicated staff ;jou, u.ill the increases impact the electricity I understand you unre elected president customers in thepur cities? of TAIPA inJuly. Ilou do you tieu.your Elkins: llecause Tb1 pas rates will neu role? be based on the cost of electricity pro-Elkins It's my responsibility to act duction, they will be slightly in the best interest of the Agency, rather higher than they would have been with-than any one city, including my out the cost increases. The rates city, Greenville. Conducting our busi. charged to customers by the cities, ness frequently requires compro. which are a combination of TAf PA rates mises on the part of one or more board and the cost of power from the four cities' generating units, also will be slightly higher than they would have i
l been. However, there is no doubt nuclear plant that was started to-that TAIPA continues to be a good in- day. The future is simply too uncertain vestment. Over the life of the Gib- to allow us to predict our electricity bons Creek plant, customers will needs more than 12 years from now. definitely pay less than they would have What do you see as the biggest problem the without Thf PA. This is because the Agemy has to sohr uithin the next price of natural gas, which is used to fyy, jears? fuel the cities' present units, is pro-jected to escalate rapidly over the next Elkins: Our biggest problem is reconcil-several years. ing the sometimes different and al-ways changing needs of the four cities The most recent etaluation oflignite re- and their creation, Tbf PA. Our serits indicates that the Agemy ou ns more board of directors is made up of elected than enough / ignite tofud Gibbon' and appointed officials with limited Creek Unit No. Ifor its projected hfetime. terms of service. It may take longer for What does TAIPA intend to do uith the them to learn about the Agency excess fud? than they are permitted to remain on E/hins: There are several options. We the board. Recently, I asked one of could build Unit No. 2, or we our directors to study other boards in an could investigate other ways to use the effort to discover an optimal struc-coal as fuel, for example, coal gas- ture for TAf PA. When the results are in, ification or liquefaction. we may consider making some changes. Technology is advancing so rapidly that I'd hesitate to commit to any one . What do you see as the biggest challengefor plan prematurely. Right now it's impor- the Agency in thefuture? tant that we finish Unit No. I and Elkins Our fundamental challenge keep our future options open. today is the same as it has always been in light of recent cost increases and - to provide reliable electric ser-schechde delaysfor nudearplants across the vice at the lowest possible cost. That's an nation, induding Comanche Peak, hou' often-used phrase and it may sound do you ticu. the Agencys risk as a part on ner simplistic, so let me explain what I of that gewrating station? mean. ' Provide" means it is our job to Elkins The information we've re- make sure that when you flip the ceived from Texas Utilities Company, switch, the light comes on. " Reliable" the plant's builder, leads me to con- eans that the light will stay on. clude that Comanche Peak, like Gib_ And "the lowest possible cost" means bons Creek, is a good investment. that you will be able to pay The majority of construction and licens_ y ur bill. ing is complete, and the projected We know that meeting this challenge fuel, operation and maintenance costs won't be easy. It involves painstak-are relatively low. That doesn't ng research, difficult choices, and, inev-mean we would choose to invest in a itably, a willingness to compromise. But the results are worth it. The success of TAf PA will help our cities be prepared for the future. 2
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1 l A PERSPECTIVE ON Ro4ers We passed a major milestone - CONSTRU(TION PROGRESS in mid-November when we com- 'Ib obtain an up-to-date report on pleted testing of the boiler more than the status of TMPA construction pie- live months ahead of schedule. ! jects, we interviewed Joel T. Thats a big unit. Ilou didyou test it? Rodgers, director of construction man-AlcKnight: We brought in a high-agement, and Robert it (flob) pressure pump and an auxiliary boiler, Mckmght, manager of projects. then filled the main boiler with 70 7he TAllM financi<d statements roter water at 4,500 pounds of pressure per the fiscal year u hich ended Septanber 30, square inch - wel1 over the 2.500 ' but I bdiere the readers of the annual pounds per square inch operating I report uill uant infirmation on the progress pressure. of construction through the end of the ;;,,, 7 ,,,g,g,,,,., cadendar year. Couldyou gite us some highlights? AliKnight: About as tall as a 27-story
. . building. It's 270 feet high and 70 Rodgers: I.et me give you an overview, f t quan.
and then we'll track progress through the year. At year-end 1981, Rodgers: It will produce three million TMPA construction projects are 79g- pounds of steam per hour, requiring complete. The Gibbons Creek a Gow of 200,000 gallons per minute of power plant is 8596 complete, the first condenser cooling water from the of our two draglines at the mine is lake we built at the site. 7596 complete *, transmission lines and is the hdefilled? substatmns are all on or ahead of schedule, and the microwave communi- Rodgers: Not only filled, but already stocked with fish. We closed the dam in cation system is well underway. 1chruary, and heavy rains in June flou many people are intohrdin the brought the lake to its present level. We construction? completed a ' pumping station in Ro4ers: About 1,000 in all, with 850 October which will provide make-up at the Gibbons Creek site. That water from the Navasota River any-doesn*c count the Comanche Peak nu. time it's needed, but 1981 has been a clear project, since it's being built wer year, and that makes the by Texas Utilities. Comanche Peak fish happy. Unit 1 is 899 complete, and Unit 2 is 527 complete. 7he Gibbons Creek plant looks as ifits ready for start-up. AhKnight: We've made a lot of progress, but we're not to that point yet. Ilowever, we already have more than 100 plant operating personnel hired and in training for start-up. 5
Will the public he able to fish in the lake? What hair you ihne to assure adherence Rodgers: Oh, yes; there will be a public
#* 'h' d'"' '#U"Ed'S entrance to the reservoir, a boat AlcKnight: A year ago, we retained a dock and picnic areas, one of which will highly campetent engineering be on an island in the lake. consc tir.g fem,5tearns-Roger, to help i
AlcKnight: The Texas Department of identify the items of design, mate-Parks and Wildlife recommended Florida ri 1 nd equipment status that would bass, which do well in warm water affect the schedule. and are good sporting catches. They Ro4ers: And the next month, in stocked 125,000 of the little bass January, we formed a ThlPA task force of between April and July. They'll each engineers, construction managers gain about a pound per year and and contractor personnel. This task force should be ready for fishermen in three was made responsible for accelerat-years. We also put in 115,000 blue ing deliveries and construction and facil-catfish, 120,000 channel catfish and itating communication among the 112,000 coppernose bluegill and various contractors. red-car perch. AlcKnight: Some vendor fabrication l're heard that construction rf the Gibbons schedules were speeded up, processes for Crnh project is behind schuhde. Is approving drawings and purchases that so? were streamlined, and the overall design Ro4ers: 1.ast Alay we conc luded that late w s "fr zen," except for essential design releases and delays in equip- changes. As a result of all these actions ment deliveries made the October 1982 ur schedules are now more closely date for commercial operation unre_ rel ted to vendor and contractor capa-alistic. So we are now working toward bilities, and they are realistic. blarch 1983 as the target for begin- Didn't construction at Gibbons Crcek ning commercial operation. pass another milestone in December? AlcKnight: We examined construction AlcKnight: Yes, the completion of the schedules from 28 other power auxiliary power system, providing plants, and we found that the revised electricity for major testing and start-up schedule for Gibbons Creek is activities. We've added 10 spe-about average for constructing fossil fuel cialized engineers to the construction plants in the United States. management team so testing and start-up can proceed quickly, now that this step has been completed. Rodgers: ThfPA named Dennis Alc-Cord as power production manager for the Gibbons Creek project. Dennis, who has previous coal-fired plant experi-ence and an AIBA degree, is assem-bling a plant staff. As a matter of fact, he began control room shifts in De-cember when the auxiliary power was turned on. I 6
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llow about the lignite mine? Lets turn now to the subject of Comanche Ikigers: Presently, ThlPA controls l'eal What is hat Utilities' schedule over 117 million tons of mineable lignite 5wnpleting the units there? within 140 feet of the surface. AlcKnight: Their latest schedule calls for Going down to 200 feet, we have identi- completion of Unit 1 in 1984 and fled nearly twice as much lignite as Unit 2 in 1985. we need to fuel the Gibbons Creek unit f fy,,y.t the cost estimates increased? for 30 years. At this point, we have completed a five-year plan for the mine, R<ulgrrs: Yes, the new estimate is and secured final mine permits $3.44 billion, compared to the $2.235 from both the EPA and the Texas Rail. billion estimated in 1980. road Commission. Ilow do these shanges affrt TAllM? AlcKnight: The first dragline will be Rodgers: Th1PA owns 6.2'I of the completed during the first quarter of Comanche Peak project, so the Agency 1982 and " walked" to the mine area is responsible for its share of the fi-to begin mining. Parts for the second nancing. When costs increase, we have dragline are being received, and to increase our financing package, construction on it has begun. and, of course, our interest payments Aren't you construaing a contryor to moir increase. But let me point out that lignitefrom the mine to the plant? cven wsth the bigger price tag, Comanche Peak will produce electricity AlcKnight; Yes, site preparation f.or at a lower cost than plants using oil the conveyor is underway along its three or natural gas. By being involved in nule route. Comanche Peak, we can assure the I presume you'll begin hiring personnd cities of an adequate supply of electricity pr the mine operation pirly soon? at reasonable prices. Rodgers: Th1PA signed a contract with From our coniersation, it's obtious that Navasota hiining Company, Inc., a 1981 has been a busy 3carpr Tall % and subsidiary of Alorrison-Knudsen Com- that a lot ofprogress has bern made to-pany, to provide most of the equip- trard the Agemy's objeaites. Thank youpr ment, including the draglines and providing this summary. conveyor, and to operate the mine. So the people who do the mining will be hired by Navasota, and that company will provide lignite to ThlPA. AlcKnight: This arrangement lowers our cost oflignite, because Navasota, as a private corporation, can take ad-t vantage of investment tax credits and other benefits not available to ThtPA. Durirg the first five years, ThiPA should save about $18 million, or 7'X, on the cost of our lignite. i 9 L.
A LOOK AT THE TMPA CITIES from shopping and entertainment, but In the following conversation, the "#f' f f ""V'd f'
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and tr ffic. We're is 15 minutes from mayors of the four cities served by two m jor recre ti n 1 lakes. TAIPA discussed the past, present and future of Bryan, Denton, Garland Could ou 3 gier us some background on and Greenville. the economies ofyour citia? Gentlemen, ue uouldlike to discuss the Smith: Through the 1960's, Bryan was a four cities you npresent as mayors - the mercantile center serving the cot-cities smed by TAIPA. Couldyou giie ton and cattle farming area along the us some inf,rmation on the location Brazos River. But following World of cach city? War II, the enrollment of students at nearby Texas A&M University Smith: Bryan is near the center of Texas, soared from less than 10,000 to 35,000. most populous area - northwest of Houston, southeast of Dallas, and Today, A&M is the single most im-p rtant influence on Bryan's economy, northeast of San Antonio and Austin. We're in an area where oil, gas and Ithough oil, gas, lignite, con-struction, warehousing and research have lignite are plentiful, close to one of the become important. Agriculture is a country's major universities, and in m instay, and banking and service-the agricultural area along the rel ted businesses are important. Brazos River. Steuart: We have three dominant influ-Stenart: It's 31 miles from Denton's Mu_ ences on our economy. The most nicipal Building to the Dallas City Hall, down Interstate 35. Immediately imp rtant is DFW Airport. We have south of Denton is the Dallas-Fort two major universities - North Texas State University with 18,000 stu-Worth Airport, one of the nation's dents, and Texas Woman's Univer-largest regional airports and a major fac-tor in our city's economy. sity with about 8,500 students. The most obvious influence is our prox-Clach: Garland's city limits meet imity to Dallas. However, Denton isn't a the Dallas city limits on Garland's bedroom community. We have our southwest side, so many people think of own industry and a highly sophisticated Garland as a part of metropolitan citizenry (one of every 97 people in Dallas. However, our city is self- our city holds a Ph.D. degree) involved sufficient and independent, and we have in sports, the arts, education and a quality oflife that can't be beat. business. Elkins: Greenville is exactly the Clach: Garland was chartered in 1884 right distance northeast of Dallas on in- and grew slowly in its early years, terstate 20. We're an hour away reaching a population ofless than 2,500 by 1910. Today, we have more than 150,000 people, so you can see the pace of our growth. However, we still have 409f of our 36,500 acres ofland to be developed. 10
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l Elkins: The City of Greenville has a Sears have regional distribution centers. l stable population of about 22,000 peo- US Steel fabricates oil well sup-i plc, but the area around the city plies, and General Electric and Union has increased in population rapidly dur- Carbide have operations, too. We ing the last few years. During the have many companies with 30-50 em-last year, we have had more industrial playees each, working principally firms locating here than in the in high-technology fields. past decade. Elkins: Greenville is the home of a l Speaking of newfirms moiing in, couldyou 3,000-employee E-Systems facility in-tell me u hat type industry your city volved in producing military elec-is attracting? tronic equipment. Liquid Paper Company, Rubbermaid and Lance Foods . Smith: As 1 mentioned, Bryan is located l in a rich hydrocarbons area, so oil, have operations here. Walker Man-l gas and lignite exploration- and produc_ uf cturing produces mufflers; Esco tion-related companies have located makes sophisticated electronic gear for in the city. B. J. Hughes, part of the oil industry; Wing produces shutters and doors; Walker-Mcdonald Hughes Tool Company, provides oil field m nuf crures oil drill bits; and sev-services, Babcock & Wilcox pro-duces pipe, and Atlas Bradford does er I c mp nies produce clothing. pipe threading. We have a number That'r impressire. Hare you offered tax of smalI companies involved in con- incentites or other benefits to attract industry struction and research and development, in competition with other cities? and Texas Instruments has pur- Smith: Bryan hasn't had to provide chased a 250-acre site for a small-busi- incentives. We cooperate with interested ness computer production facility. companies, but we believe it's un-Stewart: Denton has a diverse group fair to present residents to attract new of industries - Moore Business Forms, companies - which require ex-Peter Bilt Trucks, Morrison Mill- panded services - and not have them ing, Victor Equipment (valves), Brown pay their own share of taxes. We l Industries and Russell-Newman want those companies that want to (clothing). Texas Instruments has also be here. purchased a plant site in Denton, Stewart: Attracting industry isn't a prob-and regional warehousing and distribu- lem, because Denton is a good tion centers are locatmg here. place to live and work. We have a Resi-Clack: We have scores of companies dential and Economic Development
- in Garland producing everything from (" RED") Board which works with the l Resistol hats to foods to oil well Chamber of Commerce to provide supplies to sophisticated electronic information for selective companies in-equipment. E-Systems' Garland Divison terested in Denton.
has eight acres under roof and em-ploys 2,300 people; Kraft Foods has a plant here, and both Safeway and 13
1 l Clack: In Garland, we make some flou areyou benefiting? j mortgage money available through our Steuart: As we mentioned, each city Industrial Development Depart- already has electric generating ca-ment, which functions almost as an in-pabilities. With Thf PA's help, we've i dependent agency. It works with done an economic analysis to deter-our Chamber of Commerce and the mine the cost of generating electricity at North Texas Commission, which " sells" each plant under various conditions. North Texas throughout the country. Sinith: A central dispatcher now selects the most cost-effective way of E/hins: We haven't had to actively seek producing the power needed by the industry; it has found Greenville. cities - utilizing the generating plants We've been successful in getting the most efficient under the existing businesses we want. conditions. Ilas your grou th presentedproblems? C/ach: Garland is providing the dis-Sicuart: Certainly, but they're the patching service, in line with an agree-kinds of problems that are nice to have. ment among the four cities. Growth means expanded fire and E/hins: We're already saving more police protection and expansion of water than half a million dollars a year in fuel and sewage plants and lines, streets costs, and we're gaining experience and parks. which will be valuable when we have the C/acht . . .and utility services. Gibbons Creek and Comanche Peak Smith: Yes, that's the reason our cities pl nts on-line. Formed the Texas Afunicipal Power Sounds as ifyou are heatily iniv/ted uith Agency. Jour cities and uith TAIPA. E/hinst All four of our cities have muni- E/hini We're committed to doing cipal electrical systems, and our what's best for the people of our cities. growth demanded that we acquire siz- You know, each of our cities is able additional generating capacity unique, but we have a lot of things in so we could sustain our growth. common. We're all in Texas, and Steuart: We were, and are, interested in just being located in the Sunbelt means the cost of the electricity as well as gmwth is almost a cenainty. the availability. And even though Gmwth and change can be disastrous, TAIPA's generating units aren't yet oper- though, without proper planning. ational, the cities are already bene- C/acht Planning is essential- for firing from TAIPA. each aspect of a city's operations. For electricity, TAIPA is the medium we've chosen to equip our cities for the future. The next few decades will be exciting and rewarding for those Sun-belt cities that are prepared. Ihr more infirmation about 73fPA cities see page 25. 14 '
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TEXAS MUNICIPAL POWER AGENCY ( A Deschyment Stage Entaprise) BALANCE SliEETS, Septemixr 30,1981 and 1980 ASSETS Notes 1981 1980 Electric Plant: 3 In service: Transportation equipment S 160,000 $ 181,000 Furniture and fixtures 346,000 301,000 Electric plant leased to others 403,000 403,000 Intangible plant 445,000 445,000 Total 1,354,000 1,330,000 Less accumulated depreciation 397,000 327,000 Total - net 957,000 1,003,000 Land held for future use 289,000 289,000 Construction in progress 2, 4 557,940,000 377,931,000 Total electric plant 559,186,000 379,223,000 Other Assets: Lignite rights 7 23,963,000 20,850,000 Unamortized borrowing costs 16,886,000 17,001,000 Deferred expenses to be recovered in future years _ 139,000 42,000 Total other assets 40,988,000 37,893,000 Restricted Assets: 5 Cash 11,000 233,000
'Ilme deposits 588,000 1,000,000 Securities purchased under an agreement to resell, at cost 30,912,000 121,263,000 United States Government and Government Agency obligations 216,959,000 336,508,000 Special deposits 4,288,000 673,000 Accrued interest 4,269,000 6,250,000 Accounts receivable 290,000 14,000 Advance payments to contractors 457,000 1,734,000 Total restricted assets 287,804,000 467,675,000 Current Assets:
Cash 8,000 643,000 Time deposits 100,000 Securities purchased under an agreement to resell, at cost 1,056,000 355,000 Accounts receivable and other 61,000 26,000 Due from restricted assets 128,000 196,000 Total current assets 1,353,000 1,220,000 Total $889,331_,000 $88_6,01. l_,()00 See notes to financial statements. 16 I a
. - - - - - - . _ - . . .- -- -- _ _ - = ._- . . . - - . .- I.lAlllIJTIE\ ANI) RETAINEI) EARNINGS Notes 1981 1980 Retained Earnings Aawmulated I)aring The I)crelopment Stage S_ _ ;128,000 $__ 127,000 f.ong-lirm IMt: Revenue bonds: 6 i Series 1976 50,000,000 50,000,000 Series 1978 250,000,000 250,000,000 Series 1979 300,000,000 300,000,000 Series 1980 250,000,000 250 000,000 Unamortized diswont and premium - net (461,000) (481,000) Notes payable, excluding current instalments 7 _ 2,665,000 __ 2,367,0_00 li>tal long term debt 852,201,00() _8_5l_,883,000 Caronnt and Aarned1.iabihties: Payable from restricted assets: Current instalments of notes payable 7 360,000 307,000 Anounts payable 19,526,000 21,433,000 Retainage payable 6,135,000 4,230,000 Accrued and matured interest 9,542,000 7,055,000 Aurued compensation and pension benefits 416,000 l)ue to current assets __ 128,00(} 196,()00 1 Total payable from restricted assets 36,137,000 33,221,000 i Payable from turrent assets: Auounts payable 480,000 24,000 Accrued compensation and pension benetits 182,000 l)ue to agency auounts 85,000 _ 574,000
'lotal current and aurued liabilities 36,702,000 31,001,000 Commitm<nts and Contingencies 4, 9
'li>tal $889,3il .000 $886,011,000 17
TEXAS MUNICIPAL POWER AGENCY (A Darlopment Stage Enterprise) STATEMENTS OF OPERATIONS AND RETAINED EARNINGS Aaumulated during the Jaelopment stagepr the years ended September 30,1981 and 1980 and cumularite from inception (July 1975) to September 30, I981 1981 1980 CUMl'I.ATIVE Operating Raenues: Charges to participating Cities S 497,000 $ 362,000 S 2,716,000 Other operating income 46,000 15,000 102,000 Total operating revenues _ _ _113,000 _ ._3_77,000 _ 2,818_,000 Operating Raenue Deductions: Operating and general expenses 329,000 231,000 2,345,000 Depreciation and amortization 56,000 42,000 135,000 Total operating revenue deductions 385,000 276,000 2,480,000 Net operating revenues 158,000 101,000 338,000 Other income (Deductions): Revenues of electric plant leased to others 95,000 68,000 232,000 Expenses of electric plant leased to others, including depreciation of $19,000 per year (49,000) (46,000) (250,000) Interest income 47,695,000 36,070,000 117,873,000 Interest expense on long-term debt (62,315,000) (42,706,000) (145,428,000) Other interest expense (618,000) (618,000) Amortization of debt discount, premium and borrowing costs, net (961,000) (721,000) (2,467,000) Gain on sale of securities 4,000 90,000 94,000 Allowance for funds used in projects 16,225,000 7,267,000 30,518,000 Total other income (deductions) .6,000 22,000 (16,000) Deferred Expenses to be Reco*eredin Future Wars 97,000 42,000 139,000 Net Income 301,000 165,000 461,000 Retained Earnings Aaumulated during the Daelopment Stage: At beginning of period (deficit) 127,000 (38,000) Distributions to participating Cities (33,000) At end of period S 428,000 $ 127_,000 $_ 428,000 See notes to financial statements. 18
4 Tl!XAS MUNICIPAI. POWi!R AGliNCY (A Darlopment Stage Ent(rprise1 STATl!MiiNTS OF CilANGI!S IN FINANCIAL POSITION lhr the yars ended Lptrmixr 30,19H1 and 19H0 and canudatne frorn snaption (July 197.5) to Septemixr 30, I981 1981 1980 CUM Ul_ATIVE e
%rsa of Wholing Capital:
Net income $ 301,000 $ 165,000 $ 461,000 Depre(iation and amortitation . _19,000 _ __19,000 ._ 13_l,000 , Working (apital provided by operations $20,000 181,000 592,00 Prou;eds of revenue lmnds 219,735,000 860,06i,000 Proteeds of notes payable (net of < urrent instalments) 702,000 463,000 1,114,000 lbtal $ 1,022,000 $250,382,000 $861,770,000 Usa of MrIing Capttal: Additions to elettric plant in service and land held for future use $ 48,000 $ 72,000 $ 1,525,000 Additions to construction in progress 179,071,000 110,566,000 556,297,000 Additions to hgnite rights 3,113,000 8,717,000 23,852,000 In(rease (det rease) in net restri(ted assets ( l H2,787,000) 95,656,000 251,667,000 llorrowing (osts H25,000 4.091,000 18,534,000 liepayment of notes payable 401,000 486,000 1,419,000 Refunds to participating Cities of eness operating (harges 33,000 Refundmg of revenue bonds, Series 1975 10,625,000 Increase m working tapital __ 14H,000 _ 791,000 78H,00() , Total $ 1,022,0(H) $250,382,000 $864,770,000 Clunga in Components of Ratristal Anrn: Increase (decrease) in restrated assets: Cah, investments and special deposits $t 176,889,000) $ 101,20H,0( 0 $282,788,000 A((rued interest (1,981,000) (3,271,000) 4,269,000 Auouna receivable and advan(c payments to (ont rat tors (1,001,000) 1,629,000 747,000
'lbral (179,871,000) 99,56fi,000 287_,801,000 1 Intreasa (decrease) in liabilities payable from restricted assets:
Current instalments of notes payable 53,000 32,000 360,000 Securities sold under agreement to repurchase (14,712,000) Auounts and retainage payable (2,000) 14,851,000 25,661,000 Aurued compensation and related lwnefits 416,000 416,000 Aurued and matured interest 2,187,000 3,573,000 9,512,000 Due to current assets __ (68,()0()) .__ 196,000 128,000 lbtal 2,916,000 3,910,000 36,137,000 Increase (de(rease) in net restricted assets $( lH 2,7H7,000) $ 95,65(>,000 $251,667,000 Clunga in Component of % ling Capital: In(rease (decrease) in turrent assets. Cash and investments $ 166,000, $ 511,000 $ 1,164,000 Auounts reteivable and other 35,000 2,000 61,000 Due from restricted awets (68,000) 196,000 128,000
'lotal 133,0!)O 742,000 __1,353,000 Increase (decrease) in (urrent liabilities:
Aucunte payable 456,000 (75,000) 180,000 Aurued (ompensation and related benefits (182,000) (131,000) Due to agency aaounts (189,000) _ 160,000 _ 85,000 lbral (215,000) ._ (19,000) 565,000 Increase in working capital $ 318,000 $ 791,000 $ 788,000 See notes to financial statements. 19 4 __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ . _ _ _ _ _ _ . ___ ____ ___ ___ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
TEXAS 51UNICIPAL POWER AGENCY number of" Systems Deselopment and Re-(A Dadopment Stage Entopri4c) liability Expenditures' which primarily NOTES TO FINANCI AL STATEAIENTS relate to transmission and communication facilities.
- 1. General The Texas Alunicipal Power Agency The total financing requirements for the (TAIPA) was created in July 1975 by con. above-mentioned projects upon completion current ordinances of the Texas cities of are estimated by TAtPA as of September lityan, Denton, Garland and Greenville (Cir. 30, 1981 as follows:
ies) pursuant to Chapter 166, Acts of the 63rd Legislature of Texas, Regular Session, Construuion costs: 1973 as amended by Chapter 143, Acts Mm Creek Steam eleuric station 5 121,516,000 of the 64th Legislature, Regular Session,1975 1 M,874,000 Lignite mine (Act). Under the provisions of the Act' Transmission facilities 52.904.000 TAIPA is a separate municipal corporation, a political subdivision of the State, and p l body pohtic and corporate. Ss dnt-lopment and reliability expenditures 90,115,000 in September 1976, TAIPA entered into iden, Reserve and contingency funds tical power sales contracts with each of 111,12H,000 required by liond Resolutions the C. .ities for the purpose of obtaining the ,
; , $9 ggg economic advantages of jointly financ- Other 1146.',000 ing, constructing and operating large electric gg g generating units and related tacihties to supply the Citici future energy needs. The Cities, under the imwer sales contraus J. Summary ofSignificant Anwunting with TAIPA, are required to pay, for the bene- Po/icia fits received or to be received by them Elatric Plant - Eleuric plant is stated at from such activities, an amount sufficient to historical cost. Such cost includes pay TAIPA's operating and maintenance payroll related costs such as taxes and em-expenses and the Bond Fund, Rese ve Fund ployee benefits, general and administra-and Contingency Fund requirements of rive costs, and an allowance for funds used the Revenue llonds. in projects.
- 2. Nature of Dadopment Stage Actitstia The cost of construction performed by TAIPA is undertaking, as projects approved by contractors is recorded on the basis of billings the Cities on August 27,1976 and June from the contractors.
13, 1978, respectively, construction of the Gibbons Creek Steam Eleuric Station, a Certain facilities, primarily transmission lignite-fueled generating plant located in facilities, have been or will be completed prior Grimes County, Texas and acquisition of to the completion of any generating a 6.20f ownership interest in the omstruction plant. These completed facilities will remain of the Comanche Peak Plant, a nuclear- classified as construction in progress fueled generating plant being constructed by until placed in service. At September 30, a subsidiary of Texas Utilities Company 1981, construction in progress included (see Note 4). In addition to these projects, $17,431,000 of such completed facilities. TAIPA is planning or undertaking a FederalIncome Dxn - Any income of TA1PA, a political subdivision of the State of Texas, is exempt from Federal inwme tax under Section 115 of the Internal Reve-nue Cmle. I 20 J
AUouanceJhr runJ> Used in Projats - TA1PA Under the terms of the Agreement. T51PA is has capitalized to electric plant and lig- obligated to pay 6.2"4 of ail future (i) nice rights the net cost of tmrrowed funds used construction costs, (ii) nuclear fuel costs, (iii) for such purposes. The net cost of lmr- operating costs (after the station is rowed funds includes amonization of lxmd placed into commercial operation), (iv) a man-dismunts, premiums and borrowing agement fee of five percent of its pro rata costs, security gains and losses, and interest share of operating costs, and (v) a manage-expense net of interest income. ment fee of five percent ofits pro rara share of fuel cost (subject to certain cost esca-Lignite Rixhts - 1. ignite rights include lation limitations). Subject to certain the costs of all preliminary and exploration operational exceptions, TAIPA is entitled to studies, leaschold or fee acquisitions, receive 6.2r4 of the net power output delay rentals and advance royalties. that the station is capable of pnxlucing at any given time. The wst of lignite rights will be amortized by the unit-of-production method when The Atomic Energy Act of 1954 requires the issuance by the Nuclear Regulatory Com- , mining of the lignite commences. mission (NRC) of operating licenses for the Comanche Peak Plant. The application for thpraiation - Depreciation of electric plant the operating licenses for both units was in service is calculated by the straight- > line method using the following rates: docketed with the NRC on April 25, 1978. > In connection with the operatmg h-WJ censes, an antitrust proceeding and a safety Transimrtation Furniture and fixtures 2gj. and environmental proceeding are now Ele (cric plant leased to others y; pending before separate NRC Atomic Safety intangible plant w and Licensing Boards. Rennur &nds - Issuance costs, discounts, "*I""'.t proceeding involves nu-memus p nies, many o whom are also panies and premiums of Revenue lionds are to a dispute in Texas regarding interstate being amortized by the straight-line method nanumssmn. A preHndnary seulement has over the period of the related maturities. been reached among the parties but wdl require further regulatory review before such
- 4. Acquisition ofInterest in Comamhe Peak settlement can become final. Whether In .
Jom. January 1979, TatPA executed the the settlement will become effective cannot be t Ownership Agreement (Agreement) to . predicted at this time and there is a pos-acquire a 6.2% undm. .ded ownership in- . terest in the L,omanche Peak Steam Electnc
. sibility that the antitrust review will not be completed prior to the time Comanche Station. The project consists of two Peak Unit 1 is ready for operation. Legislation 1,15051W nuclear-fueled pressurized water-now pending in C,ongress would allow reactor steam electric units (scheduled an operating license to be granted prior to for completion in 1981 for Um.t I and 1985
. conclusion of the NRC's antitrust pro-for Um.t 2) together with associated nu-ceedings if otherwise ready for issuance, all clear fuel, switchyard, substation, railroad requirements having been met except spur and reservoir. It also m.cludes an m.-
the hearings provided for by the Act. There is terest in a (ertain associated transmission h.ne. ' no assurance that such legislarm.n wd. l be enacted into law. If an operating license has not been issued by the time Unic 1 is ready for fuel loading, costs will increase and the commercial operation date will be delayed. 21 [
- 5. Retrhrd Amts United States Government and Government Restricted assets presented in the accom- Agency obligations include United panying balance sheets include those assets States Treasury bills and notes, and securities comprising the Bond, Reserve, Con- issued by the Federal llome Loan Bank, tingency and Construction Funds which are the Federal Land Banks, and the Federal Na-established and maintained pursuant to tional Afortgage Assaiation. The se-the Bond Resolutions of TAIPA. All assets in curities bear interest at rates ranging from the Bond Fund and substantially all as- 6.159 to 17.859 and mature at various sets in the Reserve Fund are available only to dates between October 1981 and April 1991.
meet the principal and interest pay- The securities are stated at amortized ments on the Rennue Bonds. Assets in the cost which is not materially different than Construction Fund are available pri- market. TAIPA intends to hold these se-marily for the payment of construction and curities to maturity. acquisition costs of those projects de-scribed in Note 2. 6. Rainue Bonds The aggregate amount of assets in each of TalPA has four issues of Revenue Bonds out-these funds as of September 30, 1981 standing, described as follows: and 1930 is as follows: Series ( 1976 1978 1979 1980 NTremtwr 30,- Range of 1981 198() interest Bond I?und $ 6,733,000 $ 65,522,000 rates 59 5. 35'T 5%9 6'i Reserve Fund 81,316,000 72,880,000 to 6%9 to 79 to 79 to 9%9 Contingency Fund 2,011,000 2,025,000 Range of Construction Fund 197,711.600 3h7,218,(J00 annual 5287,801,000 $ 167,67 5,0, serial Total at u r-it;es 1983- 1981- 1985- 1985-TAIPA has purchased and sold invest- 2011 2011 2012 2012 ment saurities under repurchase agreements Earliest whereby TAIPA will resell or rebuy, at redemption its cost plus accrued earnings, specified date 1986 1988 1989 1990 amounts of the securities on or before spec- , itied dates. The securities are primarily The Bonds are payable solely from, and obligations of the Umted States Treasury, the are collateralized by an irrevocable first lien Federal Home Loan Afortgage Corpora. on, the net revenues of TalPA and the tien, the Government National Afortgage funde established by the Band Resolutions, Association, and Federal Home Loan subject to the payaent J operating ex-Banks. At September 30, 1981, TAIPA had penses from m incy on deposit in the Rcrenue one repurchase agreement included in Fund. restricted assets which bears interest at a Annual debt service requirements as of rate of 117 with a resale date of September 30,1981 are summarized October 1,1981. as follows: Principal interest _ Total IIN ll%$JWsbl Year Ended September 30: 1982 $ 62,087 $ 62,087 1983 $ 690 62,087 62,777' 1984 4,215 62,052 66.267 1985 11,270 61,829 73,099 1986 11,895 61,201 73,096 1987-2012 82 b930 1,055,365 1,87_7,295 Total $850,000 $ 1,Mi,621 $ 2,214,62 I
. - _ = = __ = _ = - = =
o e. I ! I
7 N l t t
! ',I y 3 '/ f
- 7. Nota l'ayable .,t ,
~,
ne Act permits TalPA to issue non-
,I/ , ,-
I ,< 'f- ' * - negotiable purchase money notes payable in <
/
instahnents (collateralized by the pniper- 3i , , 4 ties being acquired) in order to acquire lind ,
\> ,}
or fuel resources. ThlPA has issued such ,4 . o, notes which are accounted for at stated or ',[ ,
),
imputed interest rates and are due in an-nual or quarterly instalments over periods , ,
' '4
- ranging from three to sixteen ycars. He '
costs of the property and investments collar- '1 > eralizing the notes approximated ,
$8,155,000 as of September 30, 1981. ,'- - *
', 'f \
i(. . A \ M Retirement I'lan ; \,,,_, The retirement plan is structured so that ; ,j ," ' j, ThlPA contributes 1091 of gross wages to a i
) , ,
fund for participants. Employees may contribute an additional amount up to 1091 ( / ,
.i ,,.
r
, , e from their earnings on a voluntary basis.
j/ Interest is earned on each individual's account ' v until Fetirement of termination. The ( t
^ '
employee twcomes a vested participant after ' s , sin months of service. Retirement plan ,
/ '
costs fiar 1981 and 1980 were $251,000 and i j
$111,000, respectively.
- 9. Commitm<nts and Contingencia
- I In connection with the projects and ac-tivities described in Note 2, ThlPA has out- ~
standing contracts for goods and services which aggregate approximately $611,000,000 as of September 30,198; af which ap- g' proximately $-119,000,000 has been expended. , .
. n in order to obtain certain property and con- !
firm certain rights necessary to complete the Gibbons Creek Steam Electric Station. ,, ThlPA has made certain payments to , Grimes County and three school districts dur-ing the years 1978 through 1981. The Agency has agreed to make additional annual , . payments, subject to adjustment as specified in the agreement, at the rate of
$520,000 each year, beginning in 1982 and i ,
continuing as long as the Gibbons Creek , s s Unit No. I is in operation. The estimated total payments to be made by ThlPA ) under this agreement are approximately
$17,700,000 of which $2,091,000 has been paid as of September 30, 1981.
23 1
,, - AUDITORS
- REPORT in our opinion, the financial statements
" for the years ended September 30,1981 and
- ,/ f The Ibard of Directors 1980 present fairly the financial position
' . Texas Municipal Power Agency: of Texas Municipal Power Agency at Septem-ber 30,1981 and 1980 and the results of s
We have examined the balance sheets of its operations and the changes in its financial t Texas Municipal Power Agency (A Develop- position for the years then ended, and in ment Stage Enterprise) as of September our opinion, based upon our examinations and 30,1981 and 1980 and the related statements the report of other a iditors referred to
- ', of operations and reined earnings ac- alxree, the cumulative financial statements s
ctimulated during thE development stage and from inception Guly 1975) to September
,' *- of changes in 6nancial position for the 30, 1981 present fairly the cumulative results
)3 (3 years then ended and cumulative from incep- ofits operations and cumulative changes
, tion Guly 1975) to September 30,1981. in its financial position for such period, all in
'jj ,; , Our examinations were made in accordance conformity with generally accepted veith generally accepted auditing stan- accounting principles applied on a consis-
,' dards and, accordingly, included such tests of cent basis.
the accounting records and such other ,
/ ,,
auditing procedures as?ve considered neces-sary in the circumstances. The financial fM statements of Texas Municipal Power Agency for the perim! from inception Guly November 25,1981 1975) to September 30,1979 were examined by other auditors whose report, dated November 30,1979, on those statements was qualified as subject to the effects of such adjustments, if any, as might have been re. quired had the outcome of certain litiga-tion involving lignite rights been known; this uncertainry was resolved in 1980 with no adjustment to the financial statements. Our opinion eipressed herein, insofar as it relates to amounts from inception Guly 197') to September 30,1979 included in t. - statementiof operations and retained earnings accumulated during the de-velopment stage and of changes in financial position from inception Guly 1975) to
- September 30,1981, is based solely upon the repoce,of such other auditors.
-s 4
4 4 4 21 h
c-liSTIM ATED PEAK 1.OADS AND CAPACITY RESOURCES (MW) ( sf Wt t..mb,noi Praa It un 1 nl R, q u et . ,o mmo Req uire.1 Require. Lo ,n A.:eng s Leal Ne s i) ri ron !mi s h kwnes # D tm nn Rt wur, e5 Rrv.un e n Rr s, ort es Surplus 1982 67i d) 10] 775 927 0 927 152 1986 720 22 108 850 917(5) 39086) 1,307 157 1984 764 23 II) 900 917 461(7) 1,378 478 1985 812 21 122 958 917 161 1,57H 420 1986 H57 26 128 1,011 917 532(H) 1,119 tiH 1987 902 27 135 1,061 917 532 1,149 385 1988 950 28 114 1.121 917 532 1,4 19 32H i 1989 99H 10 l ' ') 1,17 H 917 532 1,119 271 f 1990 1.0 47 31 157 1,245 917 H2 1,4 19 214
- 1991 1,100 3; 165 1,298 917 532 1,419 151 1992 1.151 35 173 1,362 917 532 1,4 19 M7 (1) Tu he months ending Septemixt 40.
(2) Anumed at W of load.
' ( 5) Alost Agency transminion f acilities do not starr service until 1983, thus no lowes are assumed in 1982.
( n) A rest rse reip"rernent of 15'i is required by ERCOT O'ormerly the Texas Inter <nnneued System), a statewide utihty coordinanng
; poup (h firyan's planned ruirement of liryan Units 1 and 2.
(6) Commercul opuanon of Gibluns Crttk at 390 MW (7) Comm(rt ul operanon of Com.m(he Peak, Unit I at 71 MW. (H) Commuc ul operanon of Comanche Peak, linir 2 at 71 MW. PROHl.E OF Tile CITIES 1981* lirvan Denton Garland Greenville 2 Populat ion- 19HO 11,337 ! 48,063 138,857 l 22,161 l Popular mn- 1970 [33,719 l l 38,871 81,137 22,013 l Median lamily Inmme test.)!$ 18,779 l$23,127 ! $21,500 $ 18,500 I 96.2C; I Employment (est. ) j91.7'lf 95.0 % 93.6'J l liudding Permits (est.) 950 482 1620 21I i Malor Industries and Encrx)-rdaeJprm/mtion. ) Alisrouant antenn.n. Aletalprv!wts, ainrafi\ l Agritsitural danticals, \ liusmesses lhadling
; materials. l sompt,ter 3,,
f tuare. ; c<yuipmeno, irmis, I ruldar gnis, balcry iplastic isniaincre, jaJ l dwd trmis, ud.hnx i ammunition Jrdling l sterns ainraft
; podm t\ . fk rnitur e, f otuttnant, bunnesjornn, t ajurpunnt, ucaring i miJijhation, uuring iluunro JLrms l hnpru. Jb ur. muhi-uall I, appard, recreational l appard, uradu Ja,r>
' l j papir lav i equipnient, d<mir.d s I
l podiats f+dproJmts t ; Other Resourtes and l Rambing. agriahhure. l Alanums and histvric l Ranshing, intentate I des and mreational l Amensries j uater and h>Jrmartsu > hizhuay transportatisn, faditta , intentate l l sua. lala and i 1.do and re;reanonal l fad J<ju,uts. nonursay ; ra re.aional fialares. hixhuay transportatin i
\ sniursitia palina Eleurie Customers ! ! l Reudential !15,985 l16,225 ; 37,231 8,177 l l : !
Commerual ; i Industnal, cru ;2,317 ! 2,331 3,280 l1,273 l
'Ibral :18,332 18,556 ' 40,511 ; 9,150 i l
i Generatmg Capacity :240 M W '!168 M W 421 MW 95 MW Net Encrgy for Load ! i (kWh sales,000) 199,321 565,630 i 1,314,83' ' 752,810
*Inf:rmat ~n na;;:hed by 11< aria 25
BOARI) 0F DIRECTORS AIANAGEAfENT W. E (Bill) Elkins Frank if. Bass, Jr. Ivoid< rit e.f 11< U<.a,J Auntant G mral Atanaxcr Real Ibrate letestir Afay,r. Gruntille. Txo Joel T. Rodgers Diru tar ,{ Constrintu,n Alanaxtearnt Gwen Smale ne-lhaidrnt </ the lhard and Robert B. 51cKnight Chanman. Audit & UnJot Committee Ag.,,1,yr ,( ls,ats Aaounting. Conaruav n and Ranutatnn Garland. 7he, William P. Freem n Director <{ Finami.il Sers i.es Wayne Gibson haratary-hasurer <{the third John Turlak Ran,her, Cattle Bro,ler putarr 1%jects Enxineering Afanapr Cin Counal. Bry.irt, Tew John C. Eakins Avon Acker Afanager <{Sytemi iligh lahurJuxy Conpany Atanagement City Counal, Grantille. Tew CON 5ULTANTS Charles R. hiatthews Fina ncial C ,nsulting General Counsel Garland. 7iu Naman, liowell, Smith & Lee Richard Smith s,,nd Caansel Real Estate. land Darl<pmvil Dumas, iluguenin, Boothman and hlormw Af.syor, thyan. *lezu Fin.iucial Altnors Richard Stewart First Southwest Company Comwaal Airline Pib,t Afay,r, Dentnn. has Roland Vela Unittssity Prfruir Otntun. Texas l \ l l Design: Sommerford Ikugn, Inc. Photography: Phibp Prosen l M
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