Western's goal is to maintain the reliability and safety of its transmission system while managing power delivery costs and meeting our repayment responsibilities.
In partnership with affiliated generating agencies and customers, Western controls costs, coordinates funding agreements and prioritizes construction and rehabilitation projects.
Each year, Congress appropriates funds to finance operation and maintenance and construction and rehabilitation activities for many of our power systems. Because legislation requires that those who benefit from Federal investments repay the U.S. Treasury, we set power rates to recover all costs associated with our activities and generating agencies' power-related activities. Power revenue must also cover the Federal investment in power and transmission facilities (with interest) and certain costs assigned to power, such as aid to irrigation development.
Power revenue also funds portions of Western's purchase power and wheeling activities. Drought conditions and other factors sometimes require Western to purchase power from other suppliers to meet long-term firm power contract commitments.
As detailed in the "Western at a glance," operating revenues for FY 2011 were $1,382.1 million, including $1,035.6 million for sales of electric power. Operating expenses were $1,017.1 million.
How is Western funded?
Western receives funding from a variety of sources, including annual Congressional appropriations, customer-advanced funding and alternative financing. Alternative financing includes bill crediting, which credits a customer's bill when the customer makes a payment on Western's behalf to a Western purchase power supplier, and net billing, which nets a customer's bill after Western acquires energy or wheeling from that customer. Western also has the ability to use some power sale receipts to fund purchase power and wheeling.