2014 Annual Meeting June 12, 2014, 4 p.m Blue Ridge Electric’s corporate office Lenoir, NC
2013
Annual Report
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EXECUTIVE MESSAGE Improving our members’ lives is at the heart of all we do at Blue Ridge Electric. We are proud to report your cooperative is in sound financial shape so we’re able to deliver reliable, safe electricity to you, our members even in a mountainous terrain with severe winter weather. This is our first and most important priority, but our value to members goes beyond this. Providing electricity at the most affordable cost is a key strategic goal. Due to extreme cost pressure from a combination of factors, including the need to modernize the power grid, increasing environmental regulations, and the need to build new power plants, Through the Rural Economic Development wholesale Loan and Grant Program, Blue Ridge Electric power costs presented a $1 million loan to Exela Pharma are rising for Sciences, LLC, in December to expand their all utilities and business and add more jobs in Caldwell County. consumers. We have a three-prong approach to protect our members as much as possible from rising costs. First, we’ve secured the most favorable wholesale supply agreement with Duke Energy Carolinas and we continuously monitor our wholesale costs. We’ve also engaged every employee in a WorkSmart effort to reduce costs and avoid spending where possible without impacting customer service. Since its inception, this has helped offset rising costs by over $10 million that members would have otherwise had to cover.
pleased to keep ours at a lower level than we’ve seen from many other utilities. Providing the best customer care experience for all members is a top goal as well. Members consistently rate us among the top 3 utilities in the country for customer service and on a 10-point scale, we averaged 9.3 in 2013. Reliability is expected from members, and we’re pleased to report we’re among the top quartile in the nation for keeping the power flowing at 99.95 percent of the time — and getting it back on quickly when an outage occurs. Finally, as one of the largest companies headquartered in northwest North Carolina, we believe it’s our responsibility to help drive quality of life improvements in local communities. A primary example is our Members Foundation which provides crisis heating assistance to those in need, as well as community grants targeted to make life better through quality health care, education and economic development. A member committee helps guide the Foundation, which is funded by contributions from the profits of your cooperative’s subsidiaries and by members’ contributions to Operation Round Up®. Our desire is to deliver the best value to you, our members. From delivering reliable, affordable electricity to improving the quality of life with economic development and community improvement initiatives. We’re committed to demonstrating our purpose and the cooperative difference to our members and to our communities to make life better, now and in the future for northwest North Carolina!
Our separate, for-profit subsidiaries are also helping offset rising costs for members. In 2013, these subsidiaries produced more than $2 million that was used for operations and are funds that members don’t have to pay. These three efforts helped us keep last fall’s rate adjustment to 2.5 percent. While most utilities including Blue Ridge are anticipating annual rate adjustments for the near future, we are 26 JUNE 2014 Carolina Country
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Kenneth Greene President
Doug Johnson Chief Executive Officer 5/13/14 10:25 AM
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FINANCIAL REPORT OPERATING STATEMENT
(for Years Ending December 31, 2013 and 2012 (dollars in the thousands)
2013 2012 $ 164,382 $ 153,643 Less Operating Expenses 82,468 74,108 Cost of Power 14,263 11,102 BRE Cost of Sales 34,253 32,271 Operations & Maintenance Depreciation & Amortization 13,024 12,805 4,380 4,019 Taxes 9,406 9,026 Interest $ 157,794 $ 143,331 Total Operating Expenses Margins from Operations 6,588 10,312 Non-Operating Margins 2,675 1,724 Total Margins $ 9,263 $ 12,036 Years Ending December 31, 2013 (for BALANCE SHEET and 2012 (dollars in the thousands) Assets 2013 2012 Electric Facilities $ 418,450 $ 402,332 Less Accumulated Depreciation 125,642 116,536 Net Electric Facilities 292,808 285,796 Non-Electric Facilities Property & Equipment 11,276 9,175 Current Assets Cash & Cash Equivalents $ 5,320 $ 10,521 Accounts Receivable (Net) 21,103 20,802 Inventory 5,357 4,347 Other Current Assets 1,848 991 Total Current Assets 38,829 31,460 Investments 12,649 10,342 Other Assets 14,927 6,548 Total Assets $ 370,489 $ 343,321 Liabilities & Member Equity 2013 2012 Margins & Equities Memberships $ 132 $ 138 Other Equities 3,891 546 Patronage Capital 143,669 139,139 Total Membership Ownership $ 147,692 $ 139,823 Current Liabilities Accounts Payable $ 11,149 $ 9,922 Lines of Credit 434 – Other Current & Accrued Liabilities 13,931 12,582 Total Current Liabilities $ 25,514 $ 22,504 Long Term Debt 171,917 159,251 Other Non-Current Liabilities 25,366 21,743 Liabilities & Member Equity $ 370,489 $ 343,321
$164,382
BOARD OF DIRECTORS
Income Operating Revenues
BLUE RIDGE ELECTRIC Electric sales for 2013 =1.29
billion kilowatt
hours, a 2.7 percent increase from the prior year. The current number of electric consumers reached
74,575 for a 0.48 percent increase over the
prior year. Current-year investment in electric utility facilities exceeded $17
on cer
million.
Back Row:
Tom Trexler, Watauga District; Bradley McNeill, Ashe District; Jimmy Hemphill, Caldwell District; John Wishon, Jr., Alleghany District; J.B. Lawrence, Jr., Watauga District; David Boone, Ashe District; David Eggers, Caldwell District; Bryan Edwards, Alleghany District. Front Row:
Charity Gambill-Gwyn, Asst. Secretary-Treasurer, Alleghany District and Director-at-Large; Jeff Joines, Vice President, Caldwell District; Kenneth Greene, President, Ashe District; and Joy Coffey, Secretary-Treasurer, Watauga District.
In support of cancer awareness and prevention organizations locally, Blue Ridge Energies donated a penny for each gallon delivered last year in specially marked “Fueling the Fight” propane delivery trucks. Employees also made special appearances with the trucks at local events.
BLUE RIDGE ENERGIES, LLC Blue Ridge Energies sales volume increased
by
33 percent in 2013 due to colder winter weather
and a larger customer base.
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2013 BLUE RIDGE ELECTRIC MEMBERS FOUNDATION FINANCIAL REPORT
MEMBERS WORKING TOGETHER IN OUR COMMUNITIES
The Blue Ridge Electric Members Foundation was formed in 2006 to help improve the quality of life in our local communities. Members Foundation facts: 100 percent of all donations are used to help members and local communities. The Foundation is funded by members who give through the Operation Round Up速 programs and a Blue Ridge Electric contribution of $25,000 from the profits of Blue Ridge Energies (heating fuels subsidiary). Local grants to nonprofit programs and services are funded through the Members Foundation. Crisis heating assistance for member households in need is supported by the Members Foundation and administered by local helping agencies.
STATEMENT OF ACTIVITIES
(for Years Ending December 31, 2013 and 2012)
Revenue General Public Contributions Value of Contributed Services Interest
2013 $ 273,141 19,500 87 $ 292,728
Total Expenses Assistance Provided Administrative Services
2012 $ 267,851 19,500 139 $ 287,490 273,861 19,500 $ (5,871) 42,535 $ 36,664
Change in Unrestricted Net Assets
278,266 19,500 $ (5,038)
Unrestricted Net Assets Beginning of Year End of Year
36,664 $ 31,626
STATEMENT OF FINANCIAL POSITION
(for Years Ending December 31, 2013 and 2012)
Assets Cash and Cash Equivalents Due from Related Party
2013 $ 28,304 3,322 $ 31,626 $ 31,626
2012 $ 98,613 $ 98,613 61,949 $ 36,664
$ 31,626
$ 98,613
Total Assets Liabilities and Net Assets Current Liability Due from Related Party Unrestricted Net Assets Total Liabilities and Net Assets
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