Wiregrass Electric Cooperative Annual Meeting

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Wiregrass Electric CooperativeAnnual Meeting
October 18, 2008
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• Origins
• Obstacles
• Opportunities

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PowerSouth Service Area Map
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PowerSouth Energy Cooperative

• 2007 Revenues 620 Million
• 2008 Revenues (Projected) 715 Million
• Total Assets 1.59 Billion
• Peak Demand 2,103 MWs
• 2007 Energy Sales 8,779 GWHs

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Wiregrass Electric CooperativeRetail Rates
(Before taxes)

• August 2008 /1000 kwh
• Wiregrass Retail Revenue 122.00
• PowerSouth Cost
  80.15
• Wiregrass Distribution Cost 41.85
• The Origin of 70 of Wiregrasss cost of electric
  service is wholesale power.

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Energy Sources
The Origin of wholesale power cost is fossil
fuels.
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PowerSouth Generation Fleet - Coal

• Lowman

Total

• Miller Ownership Interest 114 MW

• Coal-Fired Capacity Provides Baseload Energy

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Powersouth Generation Fleet Natural Gas

• 1000 MW of Gas-Fired Generation
• 90 is Less Than 10 Years Old
• 500 MW High Efficiency Combined Cycle
• 110 MW Compressed Air Energy Storage
• Gas Units See Peaking and Intermediate Duty

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Obstacles..Challenges facing wholesale power
supply.

• Global Competition for resources.
• Costs are increasing.

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ESCALATION OF CONSTRUCTION COST
COMPONENTSGlobal Averages for Land-based
Construction Projects
Source Cambridge Energy Research Associates
Capital Costs Analysis Forum (CCAF). Note Bulk
Materials includes cement, steel rebar (for
cement castings), wiring, asphalt, low-level
valves, etc. Construction_Costs_CCAF
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Alabama Power announces rate increases totaling
13.5
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Composition of US Retail Electricity Prices (all
sectors)
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Obstacles..Challenges facing wholesale power
supply.

• Global Competition for resources.
• Regulatory uncertainty.
• Renewable Power?
• Global Warming/CO2 policy.

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Insufficient wind speed to support wind power
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Insufficient insolation to support PV and solar
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Capping Greenhouse Gases
How a Carbon Cap Creates Economic Impacts

• is just another way of saying Limiting current
  ways of using coal, oil, and natural gas by
  raising their cost

Cap and Trade will establish a price on
CO2-emitting sources of energy, and then will
increase that price as high as necessary to
sufficiently reduce our willingness to use those
sources of energy.
Cap and Trade is just like a tax, except that
no one knows what the tax rate will bewhen it
is being passed into law.
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Cost of Climate Change Initiatives
Loss of Gross Domestic Product Through
2050 (2007 Present Value) H.R. 6 2.0
Trillion S. 2191 5.3 Trillion Total
Projected Costs 7.3 Trillion
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Obstacles..Challenges facing wholesale power
supply.

• Global Competition for resources.
• Regulatory uncertainty.
• Managing Growth.

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Total Projected Consumer Growth from 2007 to
2008 (8,723
Consumers)
Coosa
2.69
Valley
Number of Consumers gt651 451-650 251-450
51-250 lt50
4.21
Tallapoosa River
Tallapoosa River
Central Alabama
Central Alabama
10.26
Dixie
Dixie
5.31
Pioneer
.76
South Alabama
South Alabama
3.06
Clarke
-
Washington
Clarke
-
Washington
Brundidge
Brundidge
2.35
.16
Pea River
.20
2.72
3.84
Elba
Elba
Covington
Southern Pine
Southern Pine
Opp
2.66
.37
Andalusia
Andalusia
.54
5.62
Wiregrass
ALABAMA
FLORIDA
Baldwin
County
Escambia
Choctawhatchee
Choctawhatchee
River
24.53
of Total Consumer Growth
16.61
1.72
West Florida
West Florida
6.75
Gulf
Coast
5.65
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2059 MW
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Generation Expansion Plan
4,000
3,500
3,000
2,500
Demand (MW)
2,000
1,500
1,000
500
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2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
Existing Generation
Future Generation
SEPA Hydro
Long Term Purchases
Peaking Purchases
Winter Peak Load
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Opportunities on the Horizon.

• Economy is driven by electricity.
• We have the necessary plans and resources in
  place for the next 15 years.
• PowerSouth/Wiregrass
• Nuclear power 2016.
• Wind/Biomass/Landfill gas

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Alabama Electric CooperativePowerSouth Energy
Cooperative

• June 24, 1941

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• 12 Representatives
• Sam K. Adams, Pea River EC
• John R. Ellis, Coosa Valley
  EC
• Frank Earle, Baldwin EMC
• V.G. Perdue, South Alabama
  EC
• J.W. Bass, Wiregrass EC
• W.P. Breen, Black Warrior
  EC

• B.C. Pringle, Clarke-Washington EMC
• W.P. Breen, Black Warrior EC
• Thomas D. Sanford, Jr.
• H.M. Smith, Tallapoosa River EC
• Ben L. Martin, Southern Pine EC
• Edwin Wallace, Pioneer EC
• Maury A. McWilliams, Central Alabama EC

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A Formula for SuccessCooperative
RelationshipsThank You