Approved
                                                                              BUDGET and
                                                                              FINANCIAL
                                                        PLAN _2008-2011

 

 

Background and Mission of the Power Authority of the State of New York

 

The Power Authority of the State of New York’s (“NYPA” or “Authority”) mission is to provide clean, economical and reliable energy consistent with its commitment to safety, while promoting energy efficiency and innovation, for the benefit of its customers and all New Yorkers. The Authority's financial performance goal is to have the resources necessary to achieve its mission, to maximize opportunities to serve its customers better, and to preserve its strong credit rating. 

 

NYPA generates, transmits and sells electric power and energy principally at wholesale. The Authority’s primary customers are municipal and investor-owned utilities and rural electric cooperatives located throughout New York State, high load factor industries and other businesses, various public corporations located within the metropolitan area of New York City (“SENY governmental customers”), and certain out-of-state customers.

 

To provide electric service, the Authority owns and operates six major generating facilities, eleven small gas-fired electric generating facilities, and five small hydroelectric facilities and a number of transmission lines, including major 765-kV and 345-kV transmission facilities. The most recent addition to the generation stock is a new combined-cycle electric generating plant in New York City that has a nominal capacity rating of 500 MW (the ‘‘500-MW Project’’) and that entered into commercial operation on December 31, 2005.  NYPA’s other five major generating facilities consist of two large hydroelectric facilities (“Niagara” and “St. Lawrence-FDR”), a large pumped-storage hydroelectric facility (“Blenheim-Gilboa”) and two oil-and-gas-fired facilities in New York City (“Poletti Project”) and Long Island (“Flynn Project”).  

 

In addition to Authority-supplied electricity, further customer electric energy needs are purchased from in-state generating companies, municipal electric systems, and out-of-state generating companies; principally via participation in the New York Independent System Operator (“NYISO”) market.  Also, a small amount of such energy is received from customer-owned generation.

 

To maintain its position as a low cost provider of power in a changing environment, the Authority has undertaken and continues to carry out a multifaceted program, including: (a)  the upgrade and re-licensing of the Niagara and St. Lawrence-FDR projects; (b) new long-term supplemental electricity supply agreements with its governmental customers located mainly within the City of New York (“NYC governmental customers”); (c) the construction of the 500-MW Project; (d) a significant reduction of outstanding debt; and (e) implementation of an energy and fuel risk management program.

 

To achieve its goal of promoting energy efficiency, NYPA implements two energy services programs, one for its SENY governmental customers and the other for various other public entities throughout the State. Under these programs, the Authority finances the installation of energy saving measures and equipment, which are owned by the customers and public entities upon their installation and which focus primarily on the reduction of the demand for electricity. These programs generally provide funding for, among other things, high efficiency lighting technology conversions, high efficiency heating, ventilating and air conditioning systems and controls, boiler conversions, replacement of inefficient refrigerators with energy efficient units in public housing projects, distributed generation technologies and clean energy technologies, and installation of non-electric energy saving measures.

 

Participants in these energy efficiency programs include departments, agencies or other instrumentalities of the State, the Authority’s SENY governmental customers, the Authority’s municipal electric system customers, public school districts or boards and community colleges located throughout New York State, county and municipal entities with facilities located throughout New York State, and various business/industrial customers of the Authority. By recently enacted legislation, the Authority is also authorized to engage in (1) energy efficiency services and clean energy technologies projects for public and non-public elementary and secondary schools in New York, (2) energy efficiency and conservation services and projects involving facilities using conventional or new energy technologies for certain specified military establishments in New York, and (3) replacement of inefficient refrigerators with energy efficient units in certain public and private multiple dwelling buildings.

 

On February 24, 1998, the Authority adopted its “General Resolution Authorizing Revenue Obligations” (as amended and supplemented, the “Bond Resolution”).  The Authority has covenanted with bondholders under the Bond Resolution that at all times the Authority shall maintain rates, fees or charges, and any contracts entered into by the Authority for the sale, transmission, or distribution of power shall contain rates, fees or charges sufficient together with other monies available therefor:

 

(i)         to pay all Operating Expenses of the Authority,

(ii)        to pay the debt service on all Senior Indebtedness and the debt service  on all Subordinated Indebtedness then outstanding, and all Parity Debt and Subordinated Contract Obligations, all as the same respectively become due and payable, and

(iii)      to maintain any reserve established by the Authority pursuant to the General Resolution, in such amount as may be determined from time to time by the Authority in its judgement.

  

 

 

 

NYPA’s Four-Year Projected Income Statements

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2008 Budget – Sources

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2008 Budget – Uses

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NYPA’s Four-Year Projected Cash Budgets

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