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3. The costs associated with BSII would be financed through CMMPA issued bonding and <br />collected through the energy rates after the plant goes on line in 2016. The ratepayers <br />using and benefiting from the facility would also be paying for the facility. <br />4. There is risk and reward in ownership of plant placed on ratepayers. There would be a <br />repayment obligation from the ratepayers for the bonding of BSII. <br />5. There would be financial risk with ownership in the additional peaking plants as well. <br />6. The proposed 30MW share of BSII is forecasted to provide 60%-70% of ERMU energy <br />needs in 2018. <br />7. Because of the 30 year bond for the BSII plant, about 50% of the energy rate for BSII <br />remains fixed for 30 year bond term. In other words, 50% of the energy rate for the <br />forecasted 60%-70% of ERMU's energy needs in 2018 is inflation proof for 30 years. <br />That islong-term rate stability for projected rates competitive in today's energy market. <br />This is the most attractive feature about participation in BSII. <br />8. The possible expansion of the ER Landfill would have a positive impact on the electric <br />utility especially in this scenario because it would contribute to the renewable <br />requirements mandated by the State. <br />9. Best/worst case scenario <br />a. Best =low rates, local control, independence. <br />b. ~Uorst =plant never opens. Rate payers still need to pay back pro-rated portion of <br />bond. <br />Participation in Bid Stone II and supplementing with a partial requirements power purchase and <br />ancillary services contract (for example with Connexus but could be with others) <br />1. Same as above excluding items 2,5, and 9. <br />2. If a partial requirement contract were made with Connexus, approval from GRE Board <br />would be required. <br />3. Some of the risks and rewards of plant ownership would be mitigated from the rate <br />payers because the balance of energy needs after the BSII contribution would be owned <br />by a third party. <br />4. Best/worst case scenario <br />a. Best =low rates, local control, continued relationship with Connexus and GRE <br />b. Worst =plant never opens. Rate payers still need to pay back pro-rated portion of <br />bond. <br />Sell Electric Utility (for example to Connexus, but could be to others) <br />1. If there were a sale to Connexus, GRE board approval would be needed. <br />2. Note that Connexus has higher rates for residential and small commercial customers but <br />lower rates for large commercial/industrial customers (see attached rate comparison). <br />There are approximately 9140 electric customers on ERMU's system of which 176 are <br />large commercial/industrial. So for 98% of these 9140 customers, Connexus' rates <br />would be higher than ERMU's rates. (Note that those large commercial/industrial <br />customers that make up 2% of the total ERMU customers account for approximately <br />56% of ERMU's energy needs. Also note that is has been a focus of ERMU over the <br />recent years to become more competitive with the large commercial/industrial rate.) <br />3. The 5% discount in wholesale power from GRE to Connexus for ERMU's load would be <br />eliminated. If there were a sale to Connexus, it is uncertain how this would affect <br />