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Northern Colorado Water Conservancy District Agenda Item 28b <br /> November 19-20,2014 Board Meeting (Updated November 21, 2014) <br /> Page 5 of 5 <br /> (2) Carter Lake Hydro ratios were calculated using a 20-year average (debt repayment period) of <br /> "break even"economic calculations provided by the District. These ratios are shown as a <br /> comparison of the initial risk associated with the first hydro project completed by the <br /> Enterprise. <br /> (3) Granby Hydro ratios were calculated using a 30-year average of the "Planning Scenario" <br /> economic calculations provided in the Loan Feasibility Study. This scenario is a conservative <br /> estimate based on proposed power purchase rates, annual projected power production of 4.8M <br /> kw-hrs, and escalating operations and maintenance costs. <br /> (4) The Granby Hydro will begin with no cash or revenue until power is produced. The required <br /> $585,000 borrower match for the Project will come from the District. To date, the District has <br /> spent approximately$500,000 in design, permitting, and contracting fees. The first year of <br /> power production is expected to generate$165,000 in revenues. These revenues will pay for <br /> IDCs and establish a cash reserve for the Project. <br /> Collateral: Security for the loan will be a pledge of power revenues from the Granby Hydropower <br /> Plant and annual financial reporting. Since the pledge of repayment is based on a Power Purchase <br /> Agreement, a rate covenant is not available as required by Financial Policy #5. Staff is recommending <br /> approval of a variance from Policy#5 due to a 30 year term of the Power Purchase Agreement and the <br /> Enterprise's successful history with the Carter Lake Hydropower plant. <br /> cc: Carl Brouwer, Project Manager, Northern Water Conservancy District <br /> Susan Schneider/Jennifer Mete, Colorado Attorney General's Office <br /> Attachment: Water Project Loan Program - Project Data Sheet <br />