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Economic and dam related articles

Spring Snow Too Little Too Late

by Staff
BPA Journal, June 2010

BPA now estimates it will likely finish the fiscal year with negative net revenues of approximately $230 million This shortfall was reported in BPA's second quarterly review published April 30 and is a direct result of the Northwest's low snowpack. Reduced stream flows have resulted in $450 million less revenue than BPA anticipated at the beginning of the fiscal year.

Traditionally, BPA's sales of surplus power -- power available beyond BPA's commitments to its customers -- have represented about a fifth of the agency's revenues. Revenues from these sales help keep Northwest electricity rates down.

"We had hoped a wet spring would help snowpack across the Columbia River Basin, but that didn't happen. We are now looking at the fifth lowest runoff since the hydro system has been in existence," said BPA Administrator Steve Wright.

The agency is dipping into its reserves to cover costs. This depletion of reserves, however, reduces BPA's ability in the future to handle additional financial risks, such as another below-average water year.

In good years, hydropower provides ample clean, renewable and low-cost electricity. Snowpack, rather than rain, is most critical since the hydropower system has limited storage for water. In an ideal spring, the snow melts gradually so that water is available to power generators at federal dams throughout the summer.

Spring Snow Too Little Too Late
BPA Journal, June 2010

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