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<br />01225 <br /> <br />( <br /> <br />D-R-A-F-T <br /> <br />P:\User\Thomas\95rate\OMchk <br /> <br />May 12. 1993 <br /> <br />Increased O&M Costs <br /> <br />Issue <br /> <br />. Why have the operations and maintenance (O&M) costs indicated by the 1994 <br />congressional budgets for the Colorado River Storage Project (CRSP) PRS <br />increased more than index levels would indicate from the 1993 budgets? <br /> <br />Background <br /> <br />. A preliminary analysis indicates that O&M costs estimates for the CRSP PRS <br />were about 21 percent higher than the same type of estimates (1993 <br />congressional budgets) that were used for the PRS that establ ished the <br />current firm power rate of 16.72 mills (combined rate). These O&M costs <br />do not include costs labeled in the PRS as "conservation and <br />environmental" in columns 40-45 of the backup study. They also do not <br />include sal inity control, purchased power, transmission, or interest <br />expenses. <br /> <br />~~ Sensitivities <br /> <br />. An increase in annual costs of $6 mill ion throughout the study period <br />equates to about a mill in the firm power combined rate. <br /> <br />Alternatives/Options <br /> <br />. Western is reviewing the budget data for explanations for the increases. <br />Thus far, an error has been detected in Western's 1994 congressional <br />budget which reduces Western's O&M costs by about $3.7 million. <br /> <br />Recommendation <br /> <br />. Western 1.1i 11 continue to revi e\~ the O&M cost project ions unt i 1 all <br />significant increases are explained. <br /> <br />1st Review: May 13, 1993 <br /> <br />( <br />>",;.;..' <br />