Having recently reported midyear financial and operating figures to your board of directors, I felt it would be a good time to update you as well.
Prior to each fiscal/calendar year, I prepare projections of revenue and internal expenses for Hood River Electric Cooperative based on trends or averages from prior years. The Bonneville Power Administration provides estimated wholesale power and transmission costs based on load projections they prepare after consultation with HREC staff. As the year progresses, I compare actual financial and operational performance with the projections, and update the board quarterly.
I am pleased to report that revenue from the sales of energy is quite close to my projections for mid2016. Although the total sales revenue figure is 2 percent lower than forecast, overall revenue—after including nonoperating income—exceeds the projections by 6 percent.
Expenses are tracking below projections as well, at 2 percent less than estimated for midyear. Wholesale power and transmission costs, normally about 65 percent of total annual expenses, have been 4 percent lower than expected.
The overall result is a respectable net margin thus far. If these favorable circumstances persist, I expect to recommend another meaningful retirement of capital credits late in 2016.
The Communications Access Cooperative (CACHE) continues to experience modest but consistent growth in membership and revenue. A new fulltime employee was added in April to support the ongoing growth and need for continuous deployment of new technology to meet the evergrowing appetite of members for more internet bandwidth.
CACHE is on track to retire all existing debt—consisting of notes held by HREC—in 2021. No new debt has been incurred since 2006.
Thanks for your ongoing patronage and support!
John Gerstenberger, Manager