AUSTIN ENERGY ANNUAL PERFORMANCE REPORT

Transcription

1 AUSTIN ENERGY ANNUAL PERFORMANCE REPORT Year Ended September 2015 To safely deliver clean, affordable, reliable energy and excellent customer service. This report provides operational data that details and demonstrates achievements and support for all elements of Austin Energy s mission, strategic goals and objectives. Austin Energy s goal is to keep the City Council, Electric Utility Commission, the leadership in the community, customers and employees informed on utility operations through comprehensive reporting.

2 Table of Contents Austin Energy Key Performance Measures Fiscal Year Austin Energy Service Area Performance Measures Operations and Finance Customer Sales Bad Debt Expense Operations & Maintenance and Capital Improvements Power Supply Costs Power Supply Adjustment Collections Heat Rate Water Use Generation Capacity/Capacity Factor System Peak Demand System Annual Average Production Cost Plant Outages Clean and Efficient Carbon Intensity Plant Emissions Energy Conservation Audit and Disclosure Ordinance Energy Efficiency Peak Demand Savings Energy Efficiency Avoided Emissions Energy Efficiency Program Expenditures GreenChoice Purchased Power Agreements Community Solar Program Solar Rebate Program Affordable Chart 1: 2014 Average Residential Rates* Chart 2: 2014 Average Commercial Rates* Page 2 of 39

3 Chart 3: 2014 Average Industrial Rates* Power Supply Adjustment Excellent Customer Service Line Clearance Program City of Austin Utility Contact Center Austin Payment Arrangements Low-Income Discount Program Plus 1 Fund Weatherization Assistance Program Customer Satisfaction Ratings Web Links Page 3 of 39

4 Austin Energy Key Performance Measures Fiscal Year 2015 Safely delivering clean, reliable, affordable energy along with excellent customer service is the core of Austin Energy s business. For Fiscal Year 2015, the municipally owned utility saw strong results in both its operations and finances. This exceptional performance allows Austin Energy to provide exceptional service to its customers. Between Austin Energy s total available funds and total requirements, the utility finished FY 2015 with a net position increase of more than $25 million. The utility s revenues increased in FY 2015 mainly due to increases in regulatory revenue and power supply recovery. Table 1: Austin Energy Operating Fund - Actual Dollars Fiscal Year Total Available Funds Total Requirements Excess/(Deficiency) FY 2015 $1,363,348,289 $1,337,122,101 $26,226,188 FY 2014 $1,391,240,664 $1,371,356,935 $19,883,729 FY 2013 $1,319,926,410 $1,257,770,945 $62,155,465 FY 2012 $1,211,535,702 $1,219,053,608 ($7,517,906) FY 2011 $1,259,288,587 $1,256,452,643 $2,835,944 Table 2: System Average PSA Measure FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 System fuel cost average (fuel/kwh) cents per kwh cents per kwh cents per kwh cents per kwh cents per kwh Austin Energy has consistently maintained high bond ratings, and the utility s ratings held steady in FY A bond rating is a measure of a company s credit quality, which includes the ability to repay its debt in a timely fashion. Austin Energy underwent a rate review in the fall of 2012 and received a stepup from one rating agency, while the other two rating agencies reaffirmed their prior ratings. The Council-approved rate increase was a key component in their stable outlook for Austin Energy. Fitch, Inc. upgraded the prior lien debt rating in FY 2013 due in part to strong combined debt service coverage. For FY 2016, Austin Energy is again reviewing its base rates in a transparent and public process. Austin City Council is expected to approve any changes to the utility s base rates by late summer of FY Changes would go into effect for FY Page 4 of 39

5 Table 3: Bond Ratings Description of Debt Fiscal Year Ended Fitch, Inc. Moody's Investors Service, Inc. Standard and Poor's 2015 AA Aa1 AA 2014 AA Aa1 AA Combined utility revenue bonds - prior lien 2013 AA Aa1 AA 2012 AA- Aa1 AA 2011 AA- A1 AA 2015 AA- Aa2 AA 2014 AA- Aa2 AA Combined utility revenue bonds - subordinate lien 2013 AA- Aa2 AA 2012 AA- Aa2 AA 2011 AA- A1 AA 2015 AA- A1 AA AA- A1 AA- Electric utility revenue bonds - electric separate lien 2013 AA- A1 AA AA- A1 A AA- A1 A+ Austin Energy s generation portfolio continued to perform well in FY The utility has one of the cleanest generation portfolios in the United States, and operates its units to provide the highest level of return on investment possible. Austin Energy complements its renewable generation portfolio by using traditional power sources that give the utility the ability to buffer against swings in market which protects our customers. Table 4: Generation by Fuel Type Percentage Fuel Type FY 2015 Coal 27% Natural Gas & Oil 18% Nuclear 29% Renewable Energy 26% Total 100% The utility s investments in and operations of traditional generation sources allow Austin Energy to broaden its renewable energy holdings. This focus brought an increase in total renewable energy resources for FY This increase was the result in a 500 MW increase in wind resources for the fiscal year. Because of its commitment to renewable sources, Austin Energy is looking to further increase its renewable portfolio in FY 2016 with several new solar contracts totaling more than 400 MW. Page 5 of 39

6 Table 5: Total Renewable Energy as Percent of Load Measure FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Total Renewable Energy Resources 10% 15% 21% 22% 23% Table 5a: Renewable Energy Resources Measure FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Installed Rooftop Solar Capacity Minus Losses (MW-AC) (Solar for Schools, municipal and rebate programs) 6.2 MW 8.3 MW 13.5 MW 22.3 MW 27.5MW Wind MW MW MW MW 1,340.6 MW Utility Scale Solar 30 MW 30 MW 30 MW 30 MW 30 MW Biomass 11.8 MW MW MW MW MW Total MW MW MW 1,005.0 MW 1,510.2 MW Along with Austin Energy s generation, a key component in the utility s success is ensuring the reliability of its plants and electric system. The equivalent availability factor measures the number of hours the full capacity of a generating unit is available annually. Most of the availability factors increased or stayed steady when compared with the previous year. Only the Sand Hill Units 1-4/6-7 saw a decrease in their factor due to an extended forced outage on Unit 7. Table 6: Performance Results Measuring Equivalent Availability Factor EAF Performance By Plant Target FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 South Texas Project 94.80% 87.15% 79.26% 86.82% 81.90% 94.11% Fayette Power Project 94.20% 83.69% 83.48% 82.71% 89.85% 90.75% Sand Hill Energy Center Unit 5A 95.00% 78.11% 74.20% 68.72% 71.42% 77.96% Sand Hill Energy Center Units 1-4/ % 98.62% 92.66% 87.19% 89.45% 85.10% Decker Creek Power Station GT % 93.07% 86.27% 84.19% 84.19% 90.88% Decker Creek Power Station D % 90.77% 74.98% 71.86% 71.86% 90.77% But EAF is not always the most applicable metric when looking at the Austin Energy fleet s reliability. Commercial availability is an important measurement tracked by staff to ensure the plants are positive financial assets. Commercial availability looks at how often the units are available to produce electricity when the market price is greater than the cost of running the units. The closer the Austin Energy units are to the goals, the more money the utility can make to help lower energy costs for customers. Commercial Availability is a seasonal metric, measured from June through September. Page 6 of 39

7 Table 7: FY 2015 Commercial Availability (June September) Unit Availability Goal STP FPP Sand Hill Energy Center Unit 5A Sand Hill Energy Center Units 1-4/ Decker Plant GT Decker Plant D Reliability extends beyond our generation assets to the service Austin Energy customers receive. The utility tracks the average number of power outages per customer (System Average Interruption Frequency Index), the average duration of power outages (System Average Interruption Duration Index), the 12-month rolling average of the number of transmission line faults per 100 miles (System Average Transmission Line Performance Index) and the average duration of an outage that a customer experiences (Customer Average Interruption Duration Index) so Austin Energy can ensure quality and reliable electric service. Table 8: SAIFI, SAIDI, SATPLI, CAIDI Standard Industry Average Austin Energy 2015 SAIFI The average number of times a customer s service was interrupted 1.4 interruptions 0.7 interruptions SAIDI The average duration in minutes 120 minutes 56.0 minutes SATLPI The average number of faults on each transmission line per 100 miles CAIDI The average duration of an outage that a customer experiences 4.0 faults 4.0 faults 86.2 minutes Austin Energy provides exceptionally reliable electric service to its customers, but maintaining a high level of reliability presents a challenge as the customer base continues to grow. Austin Energy s four customer classes include: Residential customers living in single-family dwellings, mobile homes, townhouses or individually metered apartment units. Secondary commercial customers including small to large businesses. This means Austin Energy owns, operates and maintains the equipment supplying power to those facilities o Secondary 1 commercial customers served at less than 10 kw. o Secondary 2 commercial customers served between 10 and 50 kw. o Secondary 3 commercial customers served at more than 50 kw. Primary customers that take service at high voltage and own, operate and maintain their own equipment. Consequently, Austin Energy experiences lower overall system losses and expense in Page 7 of 39

8 serving these customers. Large commercial and industrial customers such as semiconductors, hightech facilities and data centers typically fall under this level of service. These customers have very high usage and load factors because they tend to operate 24/7. o Primary 1 commercial customers served at less than 3 MW. o Primary 2 commercial customers served between 3 and 20 MW. o Primary 3 commercial customers served at more than 20 MW. Contract/Transmission customers owning and maintaining all equipment on the customer side for electric delivery and receiving service at 69 kv or above. Contract applies to a small number of large commercial customers operating under legacy contracts. Lighting typically refers to street lighting and facilities including ballparks. Austin Energy is constantly investing in infrastructure to serve the expanding customer base while looking at a wide variety of programs to meet the community s electric needs. Table 9: Customers* Customers FY 2015 FY 2015 % Residential 401, Secondary 1 29, Secondary 2 13, Secondary 3 5, Primary Primary Primary 3 N/A 0.00 Contract/TES/Trans Lighting Total 450, * As part of the FY 2013 rate case, Austin Energy restructured its customer classes. The above chart reflects that change. Table 9a: Customers (Historical) Customers FY 2011 FY 2012 FY 2013 FY 2014 Residential 372, , , ,410 Commercial 43,815 44,006 45,761 45,436 Industrial Other 1,640 1,668 1,426 2,406 Total 417, , , ,403 As a municipally owned utility, Austin Energy is constantly looking at ways it can benefit the community it serves, and one way the utility has found to have a positive effect on Austin is through energy efficiency programs. The utility has a diverse repertoire of efficiency programs, including Austin Energy Green Building, Power$aver and Demand Response, that help customers reduce energy and save money. In FY 2015, these programs saved more than 20,000 MWh when compared with the previous Page 8 of 39

9 fiscal year. These efforts directly benefit customers as well as set the utility on the path to meet goals put in place by Austin City Council. Table 10: Energy Efficiency Energy Savings Program (MWh) FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Residential EES- Appliance Efficiency Program 6,205 7,276 6,547 6,217 5,684 EES- Home Performance ES - Rebate 5,765 4,349 3,593 3,227 1,839 EES- Home Performance ES - Loan EES- Free Weatherization 1,141 1, EES- Clothes Washer Rebate N/A EES- Refrigerator Recycling 2,057 1,667 1,568 1,384 1,089 EES- Residential Lighting N/A N/A N/A GB- Residential Ratings GB- Residential Energy Code 7,258 9,357 10,878 11,397 12,052 Subtotal Residential 22,953 24,003 23,821 24,719 22,764 Commercial EES- Commercial Rebate 53,244 55,927 34,158 41,298 41,683 EES- Small Business 12,292 1,997 4,674 10,692 14,584 EES- Municipal 3,150 1,380 10,684 1,691 0 EES- Commercial Smart Vendor N/A N/A EES- Multifamily 7,197 7,886 8,533 6,813 12,589 EES/GB Commercial Projects N/A N/A N/A 4,533 10,253 GB- Multifamily Ratings 208 1,813 3,751 4,788 6,135 GB- Multifamily Energy Code 2,564 8,020 12,219 10,504 4,684 GB- Commercial Ratings 7,503 1,747 10,428 7,153 6,656 GB- Commercial Energy Code 8,006 5,814 8,735 15,404 31,410 Subtotal Commercial 94,322 84,588 93, , ,994 Demand Response (DR) DR- Power Partner DR- Cycle Saver DR- Power Partner (Comm & Muni) N/A N/A DR- Load Coop N/A N/A 133 N/A N/A Subtotal DR Total DSM Programs 117, , , , ,765 Page 9 of 39

10 Austin Energy Service Area The Austin Energy service area covers approximately 437 square miles and serves more than 450,000 customers. Of those square miles, square miles fall within Travis County. The remaining 14.6 square miles are in Williamson County. In the Travis County service area, square miles are within the Austin city limits. About 14 percent of Austin Energy s customers are outside the Austin area. Page 10 of 39

11 Performance Measures Operations and Finance Customer Sales Table 11: Sales-kWh by Customer Class* Customers FY 2015 Residential 4,313,183,699 Secondary 1 304,792,809 Secondary 2 872,213,592 Secondary 3 4,004,074,678 Primary 1 266,936,532 Primary 2 350,104,237 Primary 3 N/A Contract/TES/Trans 2,506,446,277 Lighting 56,518,214 Total 12,674,270,038 Inc/Dec 0.81% * As part of the FY 2013 rate case, Austin Energy restructured its customer classes. The above chart reflects that change. Table 11a: Historical Sales kwh by Customer Class Fiscal Year Residential Commercial Industrial Public Street & Highway Government Entities Total Billed kwh Inc/Dec ,313,183,699 4,651,430,855 2,795,575,622 50,749, ,330,736 12,674,270, % ,298,146,370 4,498,943,806 2,844,999,440 51,659, ,665,488 12,572,414, % ,176,498,876 4,494,515,681 2,749,206,596 40,429, ,462,707 12,305,113, % ,291,974,569 4,578,501,123 2,628,242,150 45,748, ,907,383 12,534,373, % ,607,710,679 4,685,051,357 2,352,497,093 46,700,909 1,086,392,852 12,778,352, % Bad Debt Expense Bad debt expense is the amount of revenue billed in any fiscal year that is not collected. The FY 2015 bad debt expense represents a final, audited number based on an analysis of collectability. While Austin Energy has experienced growth in receivable balances for active accounts due to a postponement of utility cut-offs for delinquent payment during Austin Energy s transition to the new customer billing system, the utility is beginning to see significant collection on those balances. Page 11 of 39

12 Table 12: Revenue and Bad Debt Expense Fiscal Year Revenue Bad Debt Expense Percentage FY 2015 $1,359.9 M $8.5 M 0.63% FY 2014 $1,388.0 M $20.9 M 1.5% FY 2013 $1,305.5 M $17.3M 1.3% FY 2012 $1,183.4 M $3.5 M 0.3% FY 2011 $1,252.7 M $3.5 M 0.3% Operations & Maintenance and Capital Improvements Table 13: Operations and Maintenance with Power Supply Costs (does not include debt service and transfers) Operating Requirements FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Net Power Supply Costs $471,788,888 $425,895,800 $455,275,095 $501,593,156 $443,535,156 Power Supply & Market Operations $144,230,284 $140,538,765 $159,078,645 $162,976,155 $138,317,501 Electric Service Delivery $128,814,600 $137,923,078 $150,565,104 $180,494,394 $192,051,588 Customer Energy Solutions $30,184,082 $32,015,121 $38,667,754 $40,465,464 $44,496,023 Customer Care $31,202,456 $26,248,955 $43,939,583 $49,373,814 $43,829,112 Administrative & General $106,645,672 $107,262,926 $104,837,164 $77,124,154* $105,252,630 Total $912,865,982 $869,884,645 $952,363,345 $1,012,027,137 $967,482,010 *Figure does not include administrative support transfer. Table 14: Capital Improvements Fund Description FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Non-Electric Plant $6,470,132 $3,588,709 $11,085,602 $22,909,580 $9,442,080 STP $1,577,299 $376,461 $11,561,993 $15,329,498 $17,608,443 FPP $22,545,042 $9,965,063 $3,911,416 $4,234,504 $2,914,105 Power Production $5,850,470 $2,484,229 $2,066,102 $3,227,479 $4,467,123 Transmission $18,170,943 $15,878,301 $32,336,167 $19,229,689 $27,002,412 Distribution $60,766,240 $62,636,482 $73,948,429 $86,420,188 $88,642,572 Metering $14,035,277 $5,115,572 $2,338,111 $128,870 $254,465 Support Services $12,730,851 $59,293,811 $14,745,222 $13,542,254 $19,859,880 Equipment $2,045,718 $1,948,422 $985,022 $1,341,925 $1,015,457 Other $1,868,097 $4,568,905 $2,444,363 $418,565 $65,649 Total $146,060,069 $165,855,955 $155,422,426 $166,782,552 $171,272,186 Page 12 of 39

13 Power Supply Costs Costs allowed in the fuel tariff include fuel for generation, transportation, renewable purchase power agreements, purchase power to serve retail customers, ERCOT fees and hedging. Table 15: Power Supply Adjustment Costs Type FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Gas $190,320,211 $148,047,838 $114,096,518 $104,981,588 $97,189,713 Coal $88,068,421 $85,032,243 $72,637,969 $83,030,951 $68,066,571 Nuclear $18,295,747 $14,087,793 $16,359,128 $16,646,703 $17,868,515 Fuel Oil $2,698,718 $897,703 $912,889 $1,062,854 $951,298 Bilaterals $57,820,582 $10,831,546 $13,408,348 $18,818,855 $4,489,538 ERCOT $66,372,518 $69,831,165 $71,546,000 $98,379,271 $76,936,494 Renewable $48,212,653 $97,167,511 $166,314,243 $178,672,934 $178,033,027 Total $471,788,849 $425,895, ,275,095 $501,593,156 $443,535,156 Table 16: Power Supply Adjustment Costs by Percentage Type FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Gas 40% 35% 25% 21% 22% Coal 19% 20% 16% 17% 15% Nuclear 4% 3% 4% 3% 4% Fuel Oil 1% 0% 0% 0% 0% Bilaterals 12% 3% 3% 4% 1% ERCOT 14% 16% 16% 20% 17% Renewable 10% 23% 36% 36% 40% Total 100% 100% 100% 100% 100% Power Supply Adjustment Collections (Over)/under power supply adjustment recovery represents the difference between actual power supply costs and the amount recovered through the power supply adjustment rates. Values in parenthesis represent an over-recovery for that year. Table 17: Power Supply Adjustment Collections Fiscal Year Amount 2015 ($61,296,027) 2014 $24,694, $11,013, ($10,384,851) 2011 $19,139,368 Page 13 of 39

14 Table 18: Sales Revenue by Customer Class* Revenue FY 2015 FY 2015 % Residential 465,814, Secondary 1 37,018,144 3 Secondary 2 104,432,763 9 Secondary 3 380,583, Primary 1 24,012,122 2 Primary 2 26,730,394 2 Primary 3 N/A 0 Contract/TES/Trans 160,005, Lighting 2,934,832 0 Total 1,201,531, * As part of the FY 2013 rate case, Austin Energy restructured its customer classes. The above chart reflects that change. Table 18a: Sales Revenue by Customer Class Revenue FY 2011 FY 2012 FY 2013 FY 2014 Residential $460,371,161 $415,576,882 $460,710,901 $487,165,010 Commercial $433,305,356 $406,593,576 $453,960,767 $495,490,442 Industrial $147,527,601 $157,868,236 $186,647,149 $199,894,116 Other $94,096,474 $91,148,798 $86,043,038 $69,526,606 Total $1,135,300,592 $1,071,187,491 $1,187,361,855 $1,252,076,174 Heat Rate The heat rate is the number of British Thermal Units needed to produce a kilowatt-hour of electricity. In other words, the average heat rate is a measurement of how efficiently a generating unit converts fuel into electricity. The lower the rate, the higher the efficiency. Austin Energy s heat rate is calculated using generation units owned entirely or jointly by the utility. Austin Energy does not own any solar or wind generating units. Table 19: Average Annual Heat Rate Measure FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 System annual average heat rate (BTU/net kwh) 9,943 10,050 9,972 10,005 9,945 Water Use Water consumption at power plants with reservoirs is considered here to be water that evaporates as a result of plant operations and any water pumped from the ground that is not returned to its original source. It does not include natural evaporation. Reclaimed water at Stand Hill is from the nearby Page 14 of 39

15 wastewater treatment plant. Fayette Power Project uses an onsite pond to reclaim discharged wastewater and reuses the water in pollution control equipment. South Texas Project s reclaimed water is primarily groundwater used for various plant processes and discharged into the cooling reservoir. For Fayette and South Texas water use share is assumed to be the same as generation share for the calendar year. Table 20: Water Use by Plant CY 2015 Decker Creek Power Plant Fayette Power Plant (facilitywide) Sand Hill Energy Center South Texas Plant (facilitywide) Facility Totals using only Austin Energy Generation & Consumption Water diverted from Colorado River (1,000 gallons) Consumption due to Forced Evaporation (all facilities) and Goundwater pumping (STP only) (1,000 gallons) Consumption of Potable Water (1,000 gallons) Reclaimed or Recycled Water (1,000 gallons) Total Consumptive Use with Reclaimed Water (1,000 gallons) Total Consumptive Use without Reclaimed Water (1,000 gallons) Percent of Use that is Reclaimed/Recycled Water Total Site Generation (MWh) Water Usage Rate with Reclaimed Water (gal/kwh) Water Usage Rate without Reclaimed Water (gal/kwh) Water Diversion Rate (gal/kwh) 322,350 3,637, ,608,188 5,068,579 70,917 3,046, ,204 11,775,845 3,315,271 83,454 4,727 32,853 24, , , , , , ,371 3,255, ,753 11,930,539 4,078, ,371 3,051, ,057 11,800,000 3,537,119 0% 6% 52% 1% 13% 625,667 9,353,964 1,745,803 19,486,878 8,818, Page 15 of 39

16 Generation Capacity/Capacity Factor For Austin Energy s coal and nuclear assets, this table reports only Austin Energy s 50 percent share of units 1 and 2 at the Fayette Power Project and 16 percent share of the South Texas Project. Table 21: Generation Capacity and Capacity Factor Unit Installed Fuel Type Capacity Rating Net Generation FY 2015 Capacity Factor Sand Hill 5A (gas) (combined cycle) Sand Hill 5C (steam) (combined cycle) Sand Hill GT 1 (simple cycle) Sand Hill GT 2 (simple cycle) Sand Hill GT 3 (simple cycle) Sand Hill GT 4 (simple cycle) Sand Hill GT 6 (simple cycle) Sand Hill GT 7 (simple cycle) Decker 1 (steam cycle) Decker 2 (steam cycle) Decker GT 1 (simple cycle) Decker GT 2 (simple cycle) 2003 Natural Gas 172 MW 773,239 MWh 54.66% 2003 Natural Gas 150 MW 498,604 MWh 37.02% 2001 Natural Gas 45 MW 54,078 MWh 12.73% 2001 Natural Gas 45 MW 53,219 MWh 12.53% 2001 Natural Gas 45 MW 52,080 MWh 12.26% 2001 Natural Gas 45 MW 42,098 MWh 9.91% 2010 Natural Gas 45 MW 52,913 MWh 12.45% 2010 Natural Gas 45 MW 51,396 MWh 12.10% 1970 Natural Gas 321 MW 208,805 MWh 7.39% 1977 Natural Gas 405 MW 315,066 MWh 8.26% 1988 Natural Gas 50 MW 16,787 MWh 3.97% 1988 Natural Gas 50 MW 13,861 MWh 3.28% Decker GT 3 (simple cycle) Decker GT 4 (simple cycle) Fayette Power Project 1 (steam cycle) Fayette Power Project 2 (steam cycle) South Texas Project 1 (steam cycle) South Texas Project 2 (steam cycle) 1988 Natural Gas 50 MW 9,984 MWh 2.36% 1988 Natural Gas 50 MW 6,156 MWh 1.46% 1979 Coal 285 MW 1,626,102 MWh 62.58% 1980 Coal 285 MW 1,627,170 MWh 65.24% 1989 Nuclear 200 MW 1,851,383 MWh % 1990 Nuclear 200 MW 1,634,302 MWh 93.14% Total N/A N/A 2,488 MW 8,887,243 MWh N/A Page 16 of 39

17 System Peak Demand System peak demand is the largest amount of electricty consumed by Austin Energy customers at one time. Every year for the past five years, the system peak occurred between 4 and 5 p.m. The utilty is constantly working to assure the distribution grid is ready and capable of handling the peak energy demand that occurs during the summer months. Table 22: System Peak Demand FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 MW 2,714 2,702 2,592 2,578 2,735 Date Set Aug. 29 June 26 Aug. 7 Aug. 25 Aug. 12 System Annual Average Production Cost Austin Energy s system annual average production cost is total operations and maintenance costs divided by total generation in kilowatt-hours. Table 23: System Annual Average Production Cost Measure FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 System annual average production cost (includes net power supply plus operations & maintenance) cents per kwh cents per kwh cents per kwh cents per kwh cents per kwh Page 17 of 39

18 Plant Outages Power plants are intricate and complicated machines. Even with Austin Energy s vigilant maintenance schedule, unexpected issues like equipment malfunctions can still take units offline. Plant operators and staff work hard to minimize these risks and get generators back online as quickly and safely as possible. The table below shows forced outages with a duration of 12 hours or greater for Austin Energy-owned generating units in FY 2015 due to equipment malfunctions or other problems. Table 24: Plant Outages Unit Outage Start Date/Time Outage End Date/Time Duration (hours) Description Sand Hill Energy Center Unit 5 Sand Hill Energy Center Unit 3 Sand Hill Energy Center Unit 6 Sand Hill Energy Center Unit 7 11/21/14 11:42 12/8/14 6:32 402:50:00 Steam Turbine control valve actuator failure 4/21/14 17:36 4/22/15 14:12 20:36:00 Turbine high vibration 10/2/14 20:32 10/3/14 15:30 18:58:00 Trouble shoot GSU 3 - tripped during storm 10/1/14 16:48 1/9/15 16: :37:00 3rd stage HPC blade liberation during operation - repair engine 8/4/15 12:00 8/5/15 10:19 22:19:00 Replace AVR PT fuse 10/9/14 0:00 10/12/14 18:30 No. 6 Bearing oil leak Decker Power Plant 2 10/13/14 10:00 10/15/14 16:30 Clean oil from generator iso-phase 10/29/14 0:00 11/2/14 14:00 Economizer tube leak and No. 6 Bearing oil leak 7/3/15 18:25 7/8/15 11:20 Make-up line to CWT 21 failed Fayette Power Project Unit 1 Fayette Power Project Unit 2 10/3/14 23:55 10/5/14 18: Repair 1A ID Fan broken IGV assembly which limited ability to ramp unit 1/24/15 21:50 2/3/15 13: Boiler Tube leak above 5R retract sootblower 3/28/15 16:19 4/1/15 21: Boiler leak in Reheat finishing section by 5R sootblower 10/22/14 23:37 10/30/14 11: Repair external boiler tube leak 11/22/14 01:00 11/24/14 18;00 65 Repair feedwater heater 4/30/15 00:01 5/9/15 02: Repair shorted precipitator fields, repair/replace scrubber wash nozzles Page 18 of 39

19 Clean and Efficient Carbon Intensity The Austin Energy system average carbon intensity is calculated as total greenhouse gas emissions at the point of combustion in pounds of CO 2 -equivalents divided by net generation in kilowatt-hours from all Austin Energy resources. Austin Energy generation resources include natural gas, coal and nuclearpowered units; renewable resources; and purchased power from renewable and non-renewable resources. GreenChoice energy sales are subtracted from the net generation total since GreenChoice customers can claim their carbon intensity to be zero. Table 25: Austin Energy System Average Carbon Intensity in Pounds of CO 2 -eq/kwh Carbon Intensity by Calendar Year CY 2011 CY 2012 CY 2013 CY 2014 CY 2015 CO 2 -eq/kwh Plant Emissions Austin Energy uses English dry tons as required for annual reporting to the U.S. Environmental Protection Agency. These reported emissions do not include CO 2 -equivalents. Table 26: Plant Emissions Reported Annually to EPA (English tons/year) Year Emissions Decker Creek Sand Hill Sub Total AE's Share of Fayette Power Plant Power Plant Energy Center Unit 1 Unit 2 Sub Total Total English Tons CY 2015 CY 2014 CY 2013 CY 2012 CY 2011 SO NO x ,777 2,260 CO 2 417, ,925 1,223,172 1,945,358 1,717,659 3,663,017 4,886,189 SO NO x ,085 1,940 2,258 CO 2 256, , ,303 1,689,069 2,198,368 3,887,437 4,727,740 SO NO x ,188 2,130 2,543 CO 2 396, ,451 1,057,856 1,959,964 2,338,864 4,298,828 5,356,684 SO NO x ,718 2,416 CO 2 721, ,790 1,479,250 1,937,690 1,674,675 3,612,365 5,091,615 SO ,326 1,647 1,657 NO x ,074 1,129 1,136 2,265 3,339 CO 2 817, ,619 1,556,378 2,294,576 2,558,572 4,853,148 6,409,526 Page 19 of 39

20 Energy Conservation Audit and Disclosure Ordinance The Austin City Council approved the Energy Conservation Audit and Disclosure ordinance in 2008 and revised the initiative in April 2011 to improve the energy efficiency of homes and buildings that receive electricity from Austin Energy. Single-family homeowners must have energy audits performed on their properties prior to a sale of their home. Multifamily properties older than 10 years are required to perform an audit and report the results to the City of Austin and all residents living in those communities. Commercial building owners participated in a phased-in reporting since 2012, for buildings 75,000 square feet and larger. Table 27: Single-Family Audits Audit Year Home Sales Exempt from Ordinance Non Exempt from Ordinance All Homes Audited Non-Exempt Homes Audited CY 2015* 9,100 2,975 6,125 3,798 62% FY ,089 2,797 8,292 5,174 62% FY ,117 5,719 8,398 4,344 52% FY ,230 4,118 7,112 3,538 50% FY ,370 4,514 5,856 2,895 49% Total since inception 70,729 27,073 43,656 25,416 58% *2015 s audit information was based on Calendar Year data. Table 28: Multi-Family Audits (cumulative totals) Fiscal Year Apartment Properties Within Austin City Limits Apartment Properties Exempt from Ordinance Apartment Properties Non -Exempt from Ordinance Apartment Properties Audited Non-Exempt Properties Audited , , % , , % , , % , , % , , % Page 20 of 39

21 Table 29: Commercial Buildings Requiring Audits for FY 2015 Buildings or Campuses over 75K sq. ft. Buildings or Campuses between 30K and 75K sq. ft. Buildings or Campuses between 10K and 30K sq. ft. Total Number of Buildings or Campuses Total Number of Buildings or Campuses Reported Total Number of Buildings or Campuses Unreported Total sq. ft. of all required buildings Total sq. ft. of all reported buildings 956 buildings 946 buildings 1252 buildings 530 buildings 546 buildings 662 buildings 264 buildings 502 buildings 1224 building million sq. ft million sq. ft million sq. ft million square feet 36 million square feet 16.3 million square feet Total sq. ft. of all unreported buildings 45.9 million sq. ft million sq. ft. 35 million sq. ft. *The format for this table changed from previous performance reports due to new information gathering methods. Page 21 of 39

22 Energy Efficiency Peak Demand Savings Peak demand is the highest point of energy use on any given day and typically occurs between the hours of 4 and 6 p.m. Austin Energy s energy efficiency and demand reduction programs are designed to lower energy usage and reduce the amount of load on the electric system. Table 30: Peak Demand Reduction Program FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Residential EES- Appliance Efficiency Program EES- Home Performance ES - Rebate EES- Home Performance ES - Loan EES- Free Weatherization EES- Refrigerator Recycling EES- Compact Fluorescent Lighting GB- Residential Ratings GB- Residential Energy Code Residential Total Commercial EES- Commercial Rebate EES- Small Business EES- Municipal EES- Commercial Smart Vendor EES- Multifamily EES/GB Commercial Projects N/A N/A N/A GB- Multifamily Ratings GB- Multifamily Energy Code GB- Commercial Ratings GB- Commercial Energy Code Commercial Total Demand Response (DR) DR- Power Partner DR- Cycle Saver DR- Power Partner (Comm & Muni) DR- Load Coop DR- Engineering Support & TES DR - ERS N/A N/A N/A N/A 0.3 DR Total Total CES Programs Percent of 900 MW Goal 30% 35% 42% 49% 56% Page 22 of 39

23 Energy Efficiency Avoided Emissions Austin Energy s Customer Energy Solutions programs help reduce statewide emissions from power plants through reducing demand. This helps meet Austin Climate Protection Plan goals by avoiding increases in power plant emissions in the ERCOT market. Table 31: Avoided Emissions for 2015 Carbon Dioxide Nitrogen Oxides Sulfur Dioxide Carbon Monoxide Suspended Particulates NMOC / VOC Residential 14, Commercial 61, Demand Response Total Metric Ton 76, Page 23 of 39

24 Energy Efficiency Program Expenditures To pursue the Austin City Council s policies in energy efficiency, Austin Energy invests millions of dollars in these programs so our customers can benefit from lower usage and bills. Unspent Energy Efficiency Services weatherization funds for FY 2015 are now carried over into the FY 2016 budget. Customer Assistance Program weatherization assitance funds have historically been carried forward into subsequent budget years. Table 32: Energy Efficiency Program Expenditures Electric Rebates and Incentives FY 2013 Adjusted Audited FY 2014 Adjusted Audited FY 2015 Adjusted Audited EES Weatherization $233,139 $729,547 $421,889 CAP Weatherization $75,728 $1,374,646 $1,464,603 Multi-family Rebates $2,524,498 $ 2,507,220 $2,612,788 Loan Options $6,024 $405,329 $(28,558) Home Performance w/ Energy Star $3,170,955 $ 2,741,297 $1,679,010 Rebate Options $(12,000) $(1,950) $(2,250) Clothes Washer Rebates $15,700 $1,100 N/A Nexus-Home Audit CD $ 49,481 $ 56,903 N/A LED and Customer Rebates N/A $6,000 $151,200 Commercial-Existing Construction $2,357,518 $2,493,467 $3,362,231 Small Businesses $760,581 $2,989,386 $4,067,930 Green Building $0 $0 $0 Commercial Power Partner $249,932 $70,122 $49,016 Refrigerator Recycle Program $377,417 $341,302 $248,971 Residential Power Partner $1,070,005 $1,115,028 $843,570 Load Coop $281,574 $187,233 $61,921 Thermal Energy Storage $0 $0 $ 0 Plug-In Vehicle Charging Station Rebates $119,500 $181,542 $435,224 Appliance Efficiency Program N/A $31,240 $805,281 Air Conditioning Rebates $1,521,960 $1,614,201 $666,435 Total $12,802,012 $16,843,613 $16,839,261 *The Green Building program does not use cash incentives. Page 24 of 39

25 GreenChoice Austin Energy has been a nationwide leader in green power sales in the voluntary market. The utility helped Texas become the nationwide leader in wind power by purchasing renewable energy from new sources developed in the state. For nine years in a row starting in 2002, Austin Energy led the country in sales of renewable energy by a utility-sponsored program, according to rankings by the U.S. Department of Energy s National Renewable Energy Laboratory. GreenChoice is Green-e Energy certified, a third-party verification that confirms renewable energy is from new sources built for the voluntary market and is not required by state or federal mandates. The GreenChoice program was revamped after 2014 with new customers no longer subscribing to batches. A new pricing structure was introduced with most new subscribers paying ¾ of a cent more per kilowatthour than the Power Supply Adjustment. Table 33: GreenChoice Enrollment for FY 2015 Customer Segment Number of Customers Annual kwh Residential 11,950 58,359,100 Small to Mid-size Commercial ,826,447 Key Accounts ,246,146 City of Austin 1, ,030,307 Totals 9, ,462,000 Table 34: Avoided Emissions Associated with FY 2015 Renewable Energy Purchases Total Renewable Energy Purchases (MWh) Equivalent emissions in ERCOT (English Tons) NO X CO 2 SO 2 3,131,015 1,128 1,850,007 3,510 Table 35: Renewable Energy and GreenChoice Sales Fiscal Year Total Renewable Energy Purchased Annually (kwh) by Austin Energy GreenChoice Sales (kwh) (Includes CAP sales) Renewable Energy passed through to Power Supply Adjustment FY ,126,034, ,462,000 2,488,572,327 FY ,895,912, ,986,607 2,211,925,756 FY ,656,952, ,972,633 1,794,979,367 FY ,082,217, ,442,709 1,337,774,515 FY ,246,081, ,458, ,622,647 Page 25 of 39

26 Purchased Power Agreements In October 2013, Austin Energy released a Request for Proposals asking for offers from qualified respondents to sell generation from new or existing solar generation facilities. From those responses, in March 2014, the Austin City council approved the purchase of the output of a 150 MW solar project to be located in West Texas. Commercial operations are expected to begin in the fourth quarter of Toward the tail end of FY 2015 and into the beginning of FY 2016, Austin Energy negotiated several new solar contracts totaling more than 400 MW. The terms for all Austin Energy s Purchase Power Agreements range from 10 to 25 years and include wind, solar, biomass and landfill gas. These agreements help Austin Energy make significant progress to its goal of 55 percent renewable energy by Table 36: Purchase Power Agreements (current and upcoming) Agreement Type Capacity (MW) Term (years) Duration Expiration Location Infigen Sweetwater 2 Wind /11/2017 West Texas Infigen Sweetwater 3 Wind /30/2017 West Texas RES - Whirlwind Wind /31/2027 Panhandle RES - Hackberry Wind /21/2023 West Texas MAP - Whitetail Wind /1/2037 South Texas Duke - Los Vientos II Wind /1/2037 Coastal Duke - Los Vientos III Wind TBD BHE Jumbo Road Wind TBD Duke - Los Vientos IV Wind TBD South Texas Valley Texas Panhandle South Texas Valley Webberville Solar /22/2036 Central Texas Roserock Solar TBD West Texas East Pecos Solar Midway Solar / / West Texas West Texas Upton County Solar West Texas Nacogdoches Biomass /31/2032 East Texas Sunset Farms Biomass Central Texas Tessman Road Biomass Central Texas Page 26 of 39

27 Community Solar Program Austin Energy is developing a community solar program in order to expand access to renters and others who cannot install solar at their own home, whether due to funding, ownership or site constraints. The first project will be located at Austin Energy s Kingsbery Substation in east Austin. In May 2015, Austin Energy entered into a contract with local solar developers PowerFin Partners LLC to construct a 2 to 3 MW solar farm on land around the substation leased from Austin Energy, and sell that power to Austin Energy for its community solar program under a 25 year power purchase agreement. The project is expected to be operational in FY Solar Rebate Program Austin Energy has a comprehensive Solar Incentive Program for customer-cited solar. Since the Solar Rebate Program began in 2004, Austin Energy has issued more than $49 million in rebates to residential customers and $8.5 million in incentives to commercial customers totaling 27.5 MW-ac at the end of FY In FY 2015, residential solar rebates were reduced from $1.10 per watt installed to $.90 per watt in June and then to $0.80 per watt in August with Incentives capped at the first 10kW of solar PV installed at a property. Residents must also meet energy efficiency requirements to qualify for a solar rebate. In August, 2015, Austin Energy introduced a capacity-based incentive ramp down schedule which will provide greater transparency and insight into forthcoming incentive reductions, and allow Austin Energy to meet its local solar goals on schedule and within budget. The commercial solar program provides a performance-based incentive to the customer over a 10-year period based on the actual kwh of solar energy produced by the system. The PBI rate was reduced from 9 cents per kwh to 8 cents per kwh in June 2015, resulting in a flood of incentive applications when the pending reduction was announced. Austin Energy undertook stakeholder engagement with both the solar industry and commercial customers to make changes to the incentive program to improve budget transparency, efficiency, and equity. As a result, Austin Energy increased the system size cap from 200 kw to 1,000 kw, and introduced a tiered incentive rate with larger systems receiving lower PBI rates, since these systems are already more cost effective due to economies of scale. Effective August 2015, new commercial PBI rates range from 8 cents per kwh for small systems under 75 kw to 4 cents per kwh for large systems over 400 kw. Like the residential program, incentive levels will ramp down over time as systems are installed and capacity goals are met. Current incentive levels can be found at austinenergy.com/go/currentsolar. Page 27 of 39

28 Table 37: Solar Incentive Program FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 Residential & Commercial Solar PV Participation ,020 Demand (MW) Energy (MWh) 2,818 3,375 7,431 12,810 11,089 Emissions 1,695 2,030 4,471 7,707 5,576 Expenditures $4,720,041 $5,758,223 $8,021,081 $7,412,875 $7,966,720 Municipal & Schools Solar PV Participation N/A N/A Demand (MW) N/A N/A Energy (MWh) ,718 N/A N/A Emissions ,034 N/A N/A Expenditures $147,423 $1,667,922 N/A N/A N/A Solar Hot Water Participation Demand (MW) Energy (MWh) Emissions Expenditures $93,500 $185,000 $51,000 $6,000 $45,656 Page 28 of 39

29 Affordable Austin Energy has affordability goals of keeping overall rate increases to no more than 2 percent a year as well as keeping base rates in the lower 50 percent of rates in Texas. Austin Energy is one of 72 municipally owned electric utilities in Texas. In 2013, for the first time in more than a decade, Austin Energy s rates came in above the state average, according to data from the Energy Information Administration. Though Austin Energy came in higher than its goal, residential rates and usage came in below the State average, helping customers save money on their bills. Table 38: Cents per kwh by Customer Class* Customer Class FY 2015 Residential Secondary Secondary Secondary Primary Primary Primary Contract/TES/Trans Lighting Total * As part of the FY 2013 rate case, Austin Energy restructured its customer classes. The above chart reflects that change. Table 38a: Historic Cents per kwh by Customer Class Customer Class FY 2011 FY 2012 FY 2013 FY 2014 Residential Commercial Industrial Other Total Customer Revenue over Total Customer kwh Page 29 of 39

30 Chart 1: 2014 Average Residential Rates* 2014 Average Residenmal Rates - Cents/kWh City of New Braunfels Southwestern Electric Power Co San Antonio City of Entergy Texas Inc. Southwestern Public Service Co Bounce Energy, Inc. StarTex Power Brownsville Public Umlimes Board Ausmn Energy Amigo Energy Stream Energy El Paso Electric Co Pedernales Electric Coop, Inc Green Mountain Energy Company Bluebonnet Electric Coop, Inc Sharyland Umlimes LP Direct Energy Services TXU Energy Retail Co LP Reliant Energy Retail Services LLC Nueces Electric Coop, Inc Source: Form EIA Data *EIA-861 data is calculated from calendar year information and may differ from Table 38a. Page 30 of 39

31 Chart 2: 2014 Average Commercial Rates* Southwestern Electric Power Co City of New Braunfels Southwestern Public Service Co Entergy Texas Inc. Green Mountain Energy Company Direct Energy San Antonio City of El Paso Electric Co Ausmn Energy Amigo Energy Pedernales Electric Coop, Inc Sharyland Umlimes LP TXU Energy Retail Co LP StarTex Power Bluebonnet Electric Coop, Inc Reliant Energy Retail Services LLC Nueces Electric Coop, Inc Stream Energy Brownsville Public Umlimes Board Source: Form EIA Data 2014 Average Commercial Rates - Cents/kWh *EIA-861 data is calculated from calendar year information and may differ from Table 38a Direct Energy: Combined Data for DE Services and DE Business Page 31 of 39

32 Chart 3: 2014 Average Industrial Rates* 2014 Average Industrial Rates - Cents/kWh Southwestern Public Service Co City of New Braunfels Entergy Texas Inc. Southwestern Electric Power Co El Paso Electric Co TXU Energy Retail Co LP Ausmn Energy San Antonio City of Reliant Energy Retail Services LLC Brownsville Public Umlimes Board Bluebonnet Electric Coop, Inc Pedernales Electric Coop, Inc Nueces Electric Coop, Inc Sharyland Umlimes LP Source: Form EIA Data *EIA-861 data is calculated from calendar year information and may differ from Table 38a. Page 32 of 39

33 Power Supply Adjustment Austin Energy s Power Supply Adjustment recovers fuel for generation, transportation, renewable purchase power agreements, purchase power to serve retail customers, ERCOT fees, hedging and the balance from the previous period. The adjustment is reviewed annually. Generally, changes to the PSA are effective Nov. 1 and the PSA is set as part of the annual budget process. The PSA is based on the electric voltage level required by a customer and are described below: Primary Level Customers This rate is applicable to electric service required by any customer who receives service at 12,500 volts to 69,000 volts. Primary Level Customers include many of Austin Energy s largest customers. Secondary Level Customers This rate is applicable to electric service required by residential customers in single-family dwellings, mobile homes, townhouses, or individually metered apartment units. It is also applicable to any business that does not receive power at a primary or transmission level. Currently, about 45,000 businesses receive the secondary PSA rate. Transmission Level Customers This rate is applicable to electric service required by any customers who receives service at 69,000 volts or higher. Primary and transmission voltage level customers about 90 industrial customers receive power at a very high voltage level. This results in reduced line losses between the point of generation and delivery to the customer. The customer is then required to reduce the voltage to a usable level. Electricity delivered at this level means fewer line losses and a lower cost of service. These customers also own and maintain the equipment at their site that s required to step down the voltage before the power enters their facility. As a result, primary and transmission customers pay a slightly lower PSA Table 39: Austin Energy Power Supply Adjustment (cents/kwh) Calendar Year Month System Secondary Primary Transmission 2015 November November November October January January Page 33 of 39

34 Excellent Customer Service Line Clearance Program Austin Energy invests about $11 million annually in its line clearance program. A staff of 14 Austin Energy arborists and foresters oversee the program. Contractors prune trees system-wide on a six-year cycle for distribution lines, maintaining 300 to 400 miles of power lines each year. They also maintain the vegetation on about 600 total miles of transmission right-of-ways on a four year cycle. About 50 crews 160 to 170 contracted employees are in the field each day. Vegetation management is important for public safety and electric system reliability. Austin Energy is one of the few utilities in the nation that tries to meet with each property owner in advance of tree trimming. A plan detailing the trimming needed for each tree on a property is discussed and provided to the property owner for their acknowledgment and signature. When property owners refuse to meet or cooperate with scheduling, they receive a letter that indicates when trimming will occur. The number of refusal letters is extremely small, often less than 1 percent annually. Table 40: Line Clearance Workload Fiscal Year Miles Trimmed Properties Refusals , , , , , City of Austin Utility Contact Center Austin Energy manages the City of Austin Utility Contact Center and Online Customer Care Portal. This is the place customers call or go online to start, stop or transfer utility services. The Contact Center receives about 6,000 calls per day. Table 41: Contacts Received Fiscal Year Contacts Received ,850, ,727, ,667, ,641, ,377,317 Page 34 of 39