Regional Cooperation Debt: A case study on debt management Javier Fernandez Treasury Manager, Bonneville Power Administration.

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Presentation transcript:

Regional Cooperation Debt: A case study on debt management Javier Fernandez Treasury Manager, Bonneville Power Administration

BPA’s Debt Portfolio 9/30/13 GenerationTransmissionTotal $ millions Liabilities Outstanding WAI RateWAM* Liabilities Outstanding WAI RateWAM* Liabilities Outstanding WAI WAM* Rate Total Appropriations3, , Total Bonds Issued to Treasury1, , , Total Federal Liabilities$5, $2, $7, BPA Liabilities to Energy Northwest4, , , BPA Liabilities to Other Nonfederal Parties BPA Liabilities for Capital Leases 3/ BPA Liabilities for Prepay 4/ Total Nonfederal Liabilities$4, $1, $6, Total FCRPS Liabilities$10, $4, $14, *WAM as of 9/30/2014

Power’s Projected Outstanding Debt From 2014 IPR, millions

1997 Appropriations Refinance $ in millions Pre-1996Post-1996 $ Principal Outstanding$6,690$4,101 % Average Interest Rate3.41%7.13% Additional Principal$100 Callable at par, anytime

Regional Cooperation Debt $3.8 billion Energy Northwest debt available to refinance from New maturities are primarily tax exempt with an estimated average interest rate of 4.92% and placed between 2020 and 2044 $3.8 billion of Federal Appropriated debt and Federal bonds paid in advance using cash freed up from the refinancing. Being paid from Average interest rate on the appropriations and bonds paid in advance is 6.07% Previously, the majority of this debt was modeled as being paid between 2020 and 2033

Projected Savings Base Case Scenario Two regional cooperation debt (millions) Total Principal Total Interest Total Debt Service Total Principal Total Interest Total Debt Service , , , , , , , , , , , , , , , , , , , ,6357,09814,7338,7136,30815, , , , , , , , , , , , , , , , , , , , , , , , , , , , ,48414,97832,46218,69513,22831,923 Energy Northwest regional cooperation debt extended: $3.2 billion. Additional Federal Debt retired with freed funds: $3.2 billion. Total Interest Savings: $1,750 million Additional Federal Debt retired with interest savings: $1,211 million. Rate benefit given with interest savings: $539 million.

Power Outstanding Debt 2016$10.4B1.1X244.8% 2028$10.6B0.9X244.9% 2044$9.3B1.7X265.0% 2016$10.3B1.2X244.5% 2028$9.8B1.3X224.7% 2044$8.1B1.8X265.0% 2016$10.7B1.9X224.4% 2028$9.0B1.4X224.5% 2044$5.9B2.6X254.9% DebtP/IWAIWAM