6.1. ERMUSR 01-15-2008Ji
Elk River
Municipal Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330-0430
January 2, 2008
To: Elk River Municipal Utilities Commission
Jerry Takle
John Dietz
Jim Tralle
From: Bryan Adams
Subject: Amiual Report to City Council
Phone: 763.441.2020
Fax: 763.441.8099
On an annual basis, all of the departments of the City of Elk River provide annual reports
to the City Council. These reports are also completed in digital format and placed on the
Cities website so the general public can view these reports. The City desires a much
more condensed version so this may be shortened in its final form. It is good for this
commission to review 2007 accomplishments and review 2008 goals.
Attached is the proposed Elk River Municipal Utilities annual report for your review and
comment.
Elk River,
Municipal Utilities
Annual Report
2007
Utilities Mission Statement
To provide our customers with safe, reliable, cost effective and quality
long term electric and water utility service. To communicate and
educate our customers in the use of utility services, programs, policies,
and future plans. These products and services will be provided in an
environmentally and financially responsible manner.
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ELK RIVER MUNICIPAL UTILITIES
SUMMARY OF YEAR 2007
BUDGETS
ELECTRIC BUDGET SUMMARY 2007
ELECTRIC REVENUE $ 20,130,228
ELECTRIC EXPENDITURES 18,443,350
ELECTRIC NET FOR CAPITAL 1,686,878
DEBT RETIREMENT 430,000
PROMISSORY NOTE TO COUNTY 183,871
GROSS 1,073,007
CAPITAL EQUIPMENT/CONSTRUCTION 4,598,500
BONDING 2,500,000 (to be verified)
NET (1,025,493)
DEPRECIATION 1,850,000
NET TO RESERVES 824,507
WATER BUDGET SUMMARY 2007
WATER REVENUE 1,952,560
WATER EXPENDITURES 2,320,869
WATER NET FOR CAPITAL (368,309)
WATER FEES GENERATED (FOR EXISTING d 500,000
FUTURE BOND PMTS)
DEBT RETIREMENT 445,000
GROSS (313,309)
CAPITAL PROJECTS 851,500
BONDING 300,000 (to be verified)
NET (864,809)
DEPRECIATION 875,000
NET TO RESERVES 10,191
BUDGET SUMMARY2007
ELK RIVER MUNICIPAL UTILITIES
YEAR IN REVIEW
2007 Major Accomplishments
Bryan Adams, General Manager
ADMINISTRATION -Theresa Slominski /Financial Director
1) Remained active in MMUA and APPA in industry restructuring and energy policy issues.
2) Remained active in Energy City activities.
3) Continued to successfully handle the increase in customers, monthly billing, and collections. Customer
monthly billing includes approximately 8,900 electric, 4,300 water, 4,400 sewer, and 5,700 garbage
accounts.
4) Administered CIP Programs for Elk River which entail, Compact Fluorescent Lamps, AC Trees, Appliance
Rebates, Cycled Air Conditioning, Commercial Rebates, and Air Conditioning Tune-up. CIP programs
exceeded $450,000.00.
S) Participated in MMTG as a vehicle to invest in CAPX 2020 electric systems expansion. This is a strategy
to keep our electric retail rates as low as possible.
6) Implemented Billflash (outsourcing of bill printing and mailing) and e-Soft (electronic filing of checks)
software systems.
7) Implemented credit check policy for customers.
ENGINEERING SERVICES -Troy Adams /Engineering Manager
1) Continued Electric and Water mapping updating.
2) Continued progress in GPS and GIS Systems.
3) Increased security systems customers from 455 to 612.
4) Started annual substation maintenance program.
5) Continued meter conversion with installation of approximately 900 electronic radio read meters.
6) Added approximately 100 new or upgraded CIP radio controllers for off peak and cycled AC customers.
7) Completed approximately 4800 locates without claims resulting from workmanship.
8) Implemented electronic documentation procedure for meter data.
WATER DEPARTMENT -David Berg /Water Superintendent
1) Looped water main on Twin Lakes Road.
2) Facilitated looping water main on County Road #12 and County Road #40 for eastern Elk River.
3) Rebuilt water main in Jackson / Irving area which solved some water quality issues.
4) Started construction of Well #9.
5) Connected 96 new water services to the water system for a total of 4413.
6) Produced over 873.7 million gallons of water with a peak day of 7.02 million gallons fora 7.5% increase
over last year.
7) Started water resource study to identify future water supply resources.
8) Received DNR approval for Water Emergency and Conservation Plan and received water appropriation
increase for five additional wells to 1.6 billion gallons per year.
9) Improved maintenance program for water production facilities.
ELECTRIC DEPARTMENT -Glenn Sundeen/ Line Superintendent
1) Constructed new Waco Substation.
2) Constructed two feeders for UHG Data Center.
3) Started construction of new feeder on County Road #1.
4) Purchased Area 18 with 123 customers from Connexus Energy along with a new feeder
from Substation North.
5) Constructed distribution system in Wild Flower and Mississippi Cove developments.
6) Our 2007 reliability indices are SAIDA - 7.41, CAIDI - 63, SAIFI - .118, and reflect excellent
reliability.
7) Completed Fuse Coordination Plan and start implementing recommendations.
8) Relocated the affected electrical facilities for the Irving Street and Deerfield road projects.
9) Rebuilt distribution systems in areas 16, 17, 21, and 23.
10) Completed electric feeder extension along County Road #40.
11) Added 379 electric meters to the electric system for a total of 9238.
12) Purchased over 225.9 million KWH of energy with a peak day of 50.4 MW or an increase of
9.9% over last year.
ELK RIVER MUNICIPAL UTILITIES
2008 GOALS
Elk River Municipal Utilities (ERMU) goals are in part reflected in our annual budget which is not
included in this report due to its length. It is safe to say this budget requires Elk River Municipal
Utilities to continue to provide reliable, cost effective electric and water utility services in a safe
and environmentally friendly fashion. ERMU `s staff spends a significant amount of time analyzing
past trends and predicting the future for physical plant items, financial requirements, and human
resources needs to ensure we have adequate capacity to successfully carry on our utility business.
The goals for 2008 in order of priority are as follows:
A) Satisfy 2008 Budget requirements and complete projects started in 2007.
B) Continue to investigate and solve long term physical and financial growth needs while
maintaining existing systems.
C) Explore options and programs for customers to use credit cards to pay utility bills.
D) Review system to streamline and improve accuracy for billing cycle from meter
reading to customer billing.
E) The wholesale electric rate from Great River Energy/Connexus is continuing to rise
in the next few years. Staff must continue to explore different strategies to offset
these increased costs thus minimizing electric rate increases.
F) Stay current on Electric Industry issues and Service Territory issues.
G) Continue to support Energy City activities.
Elk River Municipal Utilities Security System
Customers
700
600
500
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~ 400
0
~ 300
v
~ 200
100
0
1985 1990 1995 2000 2005 2010 2015
Year
Elk River Municipal Utilities Purchased Power
Costs
0.0550
0.0500
Y 0.0450
L
Q.
N 0.0400
0
U
0.0350
0.0300
1985 1990 1995 2000 2005 2010 2015
Year
ElecProjGre Page 1
Elk River Municipal Utilities Peak Day Pumpage
20000
18000
~, 16000
p 14000
a~ 12000
a
10000
~
~ 8000
0 6000
0
~
4000
2000
0
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1990
1995 2000 2005
Year
Elk River Municipal Utilities Annual Water
Production
2500
2000
~a
1500
0
0 1000
~ 500
0
Current DNR Annual Withdrawal
Limit is 1 600 Million Gal.
1990 1995 2000
2005
Year
2010 2015 202(
ElecProjGre Page 1
Elk River Municipal Utilities Electrical
Demand
140000
120000
100000
c 80000
~ 60000
E
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20000
0
1990 1995 2000 2005 2010 2015 2020
Year
Elk River Municipal Utilities Energy
Requirements
800
goo
600
~ 500
400
300
c
w 200
100
0
1990 1995 2000 2005 2010 2015 2020
Year
ElecProjGre Page 1
ELk Rlver Municipal Utilities Monthly Electrical Demand
50
45
~ 40
.= 35
.a
~ 30
~ 25
20
15
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Elk River Municipal Utilities Monthly Energy
Purchases
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3 22,000
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Elk River Municipal Utilities Monthly Water Sales
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Elk River Municipal Utilities Monthly Water Sales
$450, 000
$400, 000
$350, 000
~ $300,000
o $250,000
$200,000
y $150,000
$100, 000
$50,000
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