SMUD Weighs in on Proposition 23, Notes Income Loss

By Published On: August 13, 2010

The Sacramento Municipal Utility District board voted to oppose Proposition 23, the statewide initiative that would suspend AB 32, California’s greenhouse gas emissions law. The proposition would halt implementation of AB 32 until unemployment falls below 5.5 percent for four straight quarters. “SMUD’s action will add credibility to the ‘No’ campaign,” said Rick Bettis, representing three organizations, Breathe California, the League of Women Voters, and the Sierra Club. “I think it’ll be a true asset.” In other news, SMUD controller Cary Nethaway said August 5 that the muni lost money during the first half of the year, but not as much as had been projected. “SMUD’s activities have resulted in a decrease in net assets of $30.2 million. That’s compared to a planned decrease of $37.3 million, which is a positive variance of $7.1 million,” he said. “Our planned results were in the first half of the year a loss, and then we make it up during the summer months and end up in the positive for the year-end,” he revealed. He also said that energy usage in the district was down due to the mild weather during the first half of the year. “Through the first half [of 2010] we’re down about $25.2 million in customer revenues,” he continued. “Our customer usage is down significantly, about 5.4 percent. We’ve also added fewer customers than we had planned, although higher rates have partially helped to offset the lower revenues due to the lower usage and the lower number of customers.” He added that SMUD’s net purchase power cost during the first half of 2010 was higher than projected by about $3.1 million. This was because a higher volume has been purchased, but the cost was partially offset by lower average prices, he said.

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