Recovery.gov - Track the Money

In 2008, BPA conducted a first-of-its-kind Network Open Season (NOS) to sort out a complicated queue of service requests from customers seeking access to BPA’s transmission system. Many of these requests were for delivery of wind-generated electricity. Constraints on the transmission system at critical transfer points prevented BPA from providing service without upgrade and expansion of the grid. BPA has conducted financial analysis of the construction costs for service requests in response to the NOS and is preparing to offer transmission service with four new transmission lines and one system upgrade for 3,700 megawatts, almost 2,800 of which will come from renewable, non-carbon-emitting generation.

BPA also has completed asset management studies of needed capital upgrades and replacements for its aging transmission system and of the needs for the aging Federal hydro generation, which BPA finances through direct-funding agreements with the U.S. Army Corps of Engineers and Bureau of Reclamation. We have a prioritized sequence of projects that are needed to maintain the quality and reliability of the Northwest power system and to optimize the output of this significant source of non-carbon-emitting electrical generation.

BPA is in the process of identifying projects that address system needs and fit the Recovery Act criteria. The projects under consideration fall into these general categories:

• Transmission and hydro projects that are needed to maintain the quality and reliability of the Northwest power system and to optimize the output of this significant source of non-carbon-emitting electrical generation and facilitate integration of new renewable generation.
• Fish and wildlife projects to support the restoration of salmon and steelhead listed for protection under the Endangered Species Act.
• Assistance with regional programs to meet clean energy goals through capitalization of major investments in energy efficiency. BPA currently budgets about $40 million for annual capital investments in energy efficiency. The provisions of Recovery Act that apply to BPA are consistent with BPA’s self-financing business model, in that it increases BPA’s borrowing authority rather than authorizing appropriations, which BPA does not receive. This significant difference does make BPA’s approach to Recovery Act projects different than those DOE projects funded though appropriations. The project selection process and the funding mechanism reflect the unique BPA structure. However these differences do not alter the goals, timing, transparency and reporting requirement objectives associated with the additional borrowing authority provided under the Transmission System Act in the Recovery Act. BPA’s existing obligation to provide information to ratepayers will be used as the basis for meeting the requirements of the Recovery Act for projects funded using the added borrowing authority.


Projects and activities address the following GPRA Units:

The table below lists the funding amounts for the program by GPRA unit
GPRA Unit Name Borrowing Authority ($M)
1000082 Bonneville Power Administration 3,250

I. Corporate Controls

Office of Internal Review (OIR)

DOE’s OIR helps programs ensure that internal controls are in place, effective, and support the risk based approach to managing Recovery Act activities. OIR programs are being implemented or expanded to ensure the Recovery Act objectives are met and DOE managers and partners are both held accountable for successful execution and also have the appropriate tools to ensure that success. These programs include coordinating DOE’s “Internal Control Acknowledgment” program, conducting agency wide assessments and analyses and performing oversight of Recovery Act programs, including site and field visits. OIR worked with key impacted programs to produce initial vulnerability assessments identifying potential program specific and cross-cutting risks to ensure successful execution.

II. BPA Processes

BPA has designated the BPA CFO’s office as the central coordination office with the DOE Recovery Office.

In addition to BPA’s standard management of Treasury Borrowing Authority, BPA has identified the following objectives for management of the increased availability of Borrowing Authority:
• Increased Borrowing Authority will be used by BPA for authorized purposes and in accordance with legal and regulatory requirements.
• Reported results regarding the use of Increased Borrowing Authority and outcomes achieved will be accurate and verifiable; and
• Key process and controls associated with BPA’s use of Increased Borrowing Authority will be evaluated to assure effectiveness.

Bonneville will rely on our existing debt management controls, public processes, and project management controls and practices to ensure it does not increase costs to customers unnecessarily as a result of gaining the additional borrowing authority. It will supplement these proven practices with relevant tools designated for Recovery Act projects. BPA plans to leverage its existing risk management processes and oversight practices. BPA has a strong track record in compliance and management assurance and has received an unqualified audit opinion for over two decades. Key controls over financial management reporting of Recovery Act activities will be included in BPA’s A-123 review process.

Throughout its 72 year history, BPA has repaid federal investments within the period prescribed by law. BPA has attained very high credit ratings of AA by Standard and Poors, Aaa by Moody’s and AA with a positive outlook from Fitch Ratings based on BPA’s sound financial practices and control and risk management. Overall these ratings reflect the sound financial management maintained by BPA. Such ratings allow BPA to conduct its business at lower cost both financially and commercially.

BPA has implemented asset management practices to govern the planning, investing, operating, maintaining, and disposing of assets. These practices will meet the agency’s objectives for control and oversight as well as the requirements for Recovery Act projects by:
1. Evaluating and applying leading asset management practices;
2. Establishing long-term asset management strategies and asset objectives directed at achieving the agency’s mission, vision, and strategic objectives;
3. Developing asset management plans to implement the strategies and achieve the asset objectives and targets;
4. Monitoring and ensuring delivery of the asset objectives and targets;
5. Employing BPA’s risk management policy and approach;
6. Providing ready access to necessary asset and financial information;
7. Establishing clear roles, responsibilities, and accountabilities;
8. Incorporating structured reviews directed at continuously improving the systems.

BPA is committed to ensuring regular access to clear and transparent financial information and frequent opportunities for meaningful input into BPA cost and program decisions. The development of a regional cost review process was prompted by customer requests for an approach that provides useful and detailed information before decisions on program levels are made and by BPA’s desire to assure its decision-making is open and transparent which is consistent with Recovery Act requirements. The review structure is made up of two processes. The first process is the Integrated Program Review, which addresses proposed program costs prior to their inclusion in a rate case. The second process is the Quarterly Business Review. This customer centric process focuses on cost trends and implications for expense and capital programs.
Also, BPA prepares quarterly financial reviews, quarterly financial reports, and annual reports which are made available to the general public on our external website. Each year BPA’s external auditors perform a financial statement audit. Since 1985, BPA has received an unqualified opinion that its financial statements conform with generally accepted accounting principles and are a fair representation of BPA’s operations in all material respects.

Since BPA is a self funded government entity, BPA budgets are prepared on the basis of accrued expenditures consistent with BPA’s FASB GAAP commercial operational reporting and rate making processes. Accrued expenditures are the basis of presenting BPA’s program funding levels in the power and transmission rate making processes and the basis upon which BPA managers control their resources. BPA is mandated to deposit all revenue receipts from Northwest ratepayers and to make all expenditures from the BPA Fund. BPA will completely fulfill public transparency and accountability objectives through separate project accrued expenditure reporting using its enterprise system for any future projects attributed to the Recovery Act.

Performance results will be uploaded into the DOE iManaged Data Warehouse (IDW) for required agency reporting.

Performance results from DOE’s Recovery Act activities will also be monitored through OMB’s PARTweb system. This information will be available at Recovery.gov.

BPA’s financial website is located at: http://www.bpa.gov/corporate/Finance/.

The Recovery Act provides BPA a new increment of Treasury Borrowing Authority under the Transmission System Act. BPA is authorized to use its borrowing authority for multiple purposes, including among other capital purposes energy efficiency and conservation investments in BPA's real property. BPA will comply with energy efficiency and green building requirements for all applicable federal infrastructure investments.