2011 Budget vs. Actual Status

Transcription

1 2011 Budget vs. Actual Status (unaudited d results) ($ in millions, unless otherwise noted) Draft - For Discussion Purposes Only Cheryl Hussey Controller & Asst. Treasurer Budget & Priorities Working Group February 6, 2012

2 Executive Summary 2011 budget vs. actual results are contingent upon the completion of NYISO s financial statement audit (scheduled for mid-march). NYISO undercollected $0.2M on 2011 Rate Schedule 1 transactional volumes (driven by weather), and had a spending underrun of $2.2M (1.5% variance against the 2011 budget). The 2012 budget, as recommended by the Management Committee and approved by the Board of Directors, included a provision that approximately $1.5M would be remaining from the 2011 budget cycle to reduce the 2012 budgeted revenue requirement and resulting Rate Schedule 1 charge. 2

3 Executive Summary (continued) Recap of 2011 Budget vs. Actual Results: $ 2.2M 2011 Budgetary Underspending ($0.2M) Offset: 2011 RS1 Undercollection ($1.5M) Offset: 2011 Funds Carried Forward to 2012 $ 0.5M Funds Remaining from 2011 Budget Cycle NYISO staff has recommended to the Board that NYISO retain the remaining $0.5M to offset against potential 2012 RS1 undercollections. If not needed for 2012 RS1 undercollections, NYISO would plan to utilize the $0.5M to reduce debt. 3

4 NYISO 2011 BUDGET VS. ACTUAL: RATE SCHEDULE 1 RECOVERIES Draft For Discussion 4

5 RS1 Volume Statistics STATISTICS ON MWH VOLUME PER YEAR January February March April May June July August Sept October November December Total by Year Average Draft For Discussion 5

6 Summary of 2011 Rate Schedule 1 Recoveries 2011 MWH Comparison: Budget vs. Actual Invoice Month Budget MWH Actual MWH Monthly Differential MWH Cumulative Differential MWH Monthly $ Impact Cumulative $ Impact Jan $ - $ - Feb (0.2) (0.2) $ (0.2) $ (0.2) Mar (0.2) (0.4) $ (0.2) $ (0.4) Apr (0.4) $ - $ (0.4) May (0.1) $ 0.3 $ (0.1) Jun $ 0.1 $ - Jul $ 1.0 $ 1.0 Aug (0.3) 0.8 $ (0.3) $ 0.7 Sep $ 0.1 $ 0.8 Oct $ - $ 0.8 Nov (0.4) 0.5 $ (0.3) $ 0.4 Dec (0.7) (0.2) $ (0.6) $ (0.2) Total (0.2) Draft For Discussion 6

7 2011 Non-Physical Market Activity Market Activity Allocation of Rate Schedule 1 Costs to Non-Physical Market Activity Projected 2011 Annual Revenue Requirement 2011 Billing Rate/Unit TOTAL Transmission Congestion Contracts $6.9M $0.025 / TCC MWh $ 4,346,000 Virtual Trading $2.1M $ / Cleared MWh $ 2,135,000 SCR/EDRP <$10, RS1 Rate for Physical Injections $ 1,829 Total $9.0M $ 6,482,829 Draft For Discussion 7

8 NYISO 2011 BUDGET VS. ACTUAL: BUDGETARY RESULTS Draft For Discussion 8

9 2011 Budget vs. Actual Results ($ in millions) Cost Category Original Budget ANNUAL AMOUNT Year-End Actual Variance %Variance Non - Infrastructure Master Plan Capital $ 9.0 $ 9.4 $ % Infrastructure Master Plan Capital $ 12.1 $ 14.7 $ % Less: Proceeds from ST Financing - 3 years $ (5.0) $ (7.0) $ (2.0) 40.0% Less: Proceeds from LT IMP Financing - 20 years $ (5.1) $ (3.3) 3) $ % 3% **Less: Pending Proceeds from LT IMP Financing - 20 years (timing of Draws & Retainage) Less: Proceeds from 2010 budget underrun and volume overcollections $ - $ (2.5) $ (2.5) 0.0% $ (2.0) $ (1.9) $ % Capital net of IMP funding $ 9.0 $ 9.4 $ % Salaries & Benefits $ 68.3 $ 69.9 $ % Professional Fees (including Legal) $ 31.3 $ 28.1 $ (3.2) -10.2% Building Services $ 5.0 $ 4.6 $ (0.4) -8.0% Computer Services $ 16.0 $ 15.3 $ (0.7) -4.4% Insurance $ $ $ (0.8) -22.9% Telecommunications $ 4.1 $ 4.2 $ % Other Expenses (BOD, Travel/Trng, NPCC Fees) $ 3.2 $ 2.7 $ (0.5) -15.6% Current Year Needs (excluding FERC Fees) $ $ $ (3.5) -2.5% Debt Service from Prior Year Financings $ 25.9 $ 25.8 $ (0.1) -0.4% Cash Budget (excluding FERC Fees) $ $ $ (3.6) -2.2% Less: Miscellaneous Revenues $ (7.6) $ (5.1) $ % Less: Proceeds from Debt $ (25.0) $ (25.0) $ - 0.0% Add: Interest on Debt + IMP financing $ 0.7 $ 0.3 $ (0.4) -57.1% Net Budget Needs (excluding FERC Fees) $ $ $ (1.5) -1.1% 11% FERC Fees $ 12.0 $ 11.3 $ (0.7) -5.8% Rate Schedule #1 Revenue Requirement $ $ $ (2.2) -1.5% Draft For Discussion 9

10 2011 Budget vs. Actual Variance Explanations Year-End Variance Non Infrastructure Master Plan Capital N/A Infrastructure Master Plan Capital A year-end overrun of $2.6M is due to acceleration of the schedule to complete the Guilderland Data Center construction. Although 2011 costs were higher, additional borrowing of mortgage g proceeds offset any potential budget impact during Proceeds from ST Financing 3 years Salaries & Benefits Professional Fees Building Services Computer Services Insurance Telecommunications Other Expenses Debt Service Misc. Revenues Interest on Debt FERC Fees The 2011 budget assumed debt proceeds of $5.0M to fund NYISO s Infrastructure Master Plan activities until financing was approved later in the year. Due to the delayed start of the Smart Grid Investment Grant (SGIG) project, $2.0M additional funds were available from the 2010 debt facility to borrow in A year-end overrun of $1.6M is due to increased headcount and an annual incentive plan payout percentage higher than budgeted, partially offset by savings on health insurance premiums. A year-endend underrun of $3.2M is primarily due to savings in SGIG consulting of $2.5M. N/A A year-end underrun of $0.7M is due to savings on hardware and software maintenance contracts. A year-end underrun of $0.8M is due to savings on insurance policy renewals. N/A A year-end underrun of $0.5M is due to savings on travel and meetings expenditures and actual NPCC fees lower than budgeted. N/A A year-end underrun of $2.5M is primarily due to savings on SGIG expenditures which are 50% reimbursed by DOE as grant revenue in the amount of $1.8M, a shortfall of $0.4M in Interconnection Studies revenue, and a shortfall in interest income of $0.1M. A year-end end underrun of $0.4M is due to lower actual interest rates on borrowings than was budgeted. A year-end underrun of $0.7M is due to a lower actual FERC Fee invoice than was budgeted. Draft For Discussion 10

11 2011 Smart Grid Investment Grant Budget vs. Actual Cost Category 2011 Original Budget 2011 Actual 2011 Budget vs. Actual Capital - $1.7M $0.7M ($1.0M) Salaries & Benefits - $1.0M $0.8M ($0.2M) Professional Fees - $7.0M $4.5M ($2.5M) Computer Services - $0.3M $0.1M ($0.2M) Telecommunications- $ - $0.3M $0.3M Revenue - ($5.0M) ($3.2M) $1.8M Debt Proceeds - ($5.0M) ($3.2M) $1.8M Interest on Debt Proceeds - $0.1M $ - $ - Total - $0.1M $ - $ - 11

12 2011 Infrastructure Master Plan Budget vs. Actual Cost Category 2011 Original Budget 2011 Actual Budget vs. Actual Guilderland Data Center Construction - $10.9M $12.1M1M $1.2M East Greenbush Control Center Design - $1.2M $2.6M $1.4M Total - $12.1M $14.7M $2.6M Sources of Funding for 2011 IMP Costs 2011 IMP Actual Cost - $14.7M Less: Proceeds from ST Financing - 3 years ($7.0M) Less: Proceeds from LT IMP Financing - 20 years **($5.8M) Less: Proceeds from 2010 budget underrun & Volume Overcollections ($1.9M) ** Proceeds of $5.8M is for services performed in 2011, a portion of which, will be received in $ - 12

13 Outstanding Debt Summary Debt Facility Loan Status Maturity Date Amount Borrowed Principal Outstanding at 12/31/2011 Revolving Credit Facility $50M Available Dec-13 $ - $ Mortgage - Bldg Acq. & Renovations Term Loan Repayment Aug-25, Jan-27 $ 24.8 $ Budget Loan Term Loan Repayment Dec-11 $ 16.7 $ Budget Loan Term Loan Repayment Dec-12 $ 18.3 $ Budget Loan Term Loan Repayment Dec-13 $ 30.0 $ Budget Loan Principal payments begin in 2012 Dec-14 $ 25.0 $ 25.0 Principal payments begin Infrastructure Master Plan Mortgage in 2014 Aug-31 $ 3.3 $ 3.3 Total $ 74.1 Draft For Discussion 13

14 The New York Independent System Operator (NYISO) is a not-for-profit corporation responsible for operating the state s bulk electricity grid, administering New York s competitive wholesale electricity markets, conducting comprehensive long-term planning for the state s electric power system, and advancing the technological infrastructure of the electric system serving the Empire State New York Independent System Operator, Inc. All Rights Reserved. Draft For DiscussionDRAFT FOR DISCUSSION PURPOSES ONLY 14 10