Item 5
VALLEY CLEAN ENERGY ALLIANCE
Staff Report – Item 5
______________________________________________________________________________ TO: Board of Directors
FROM: Mitch Sears, Executive Director
Edward Burnham, Finance and Operations Director
SUBJECT: Financial Update – April 30 2024 (unaudited) financial statements (with comparative year to date information) and Actual vs. Budget year to date ending April 30 2024
DATE: June 13, 2024
RECOMMENDATION:
Accept the following Financial Statements (unaudited) for the period of April 1, 2024 to April 30 2024 (with comparative year to date information) and Actual vs. Budget year to date ending April 30 2024.
BACKGROUND & DISCUSSION:
The attached financial statements are prepared in a form to satisfy the debt covenants with River City Bank pursuant to the Line of Credit and are required to be prepared monthly.
The Financial Statements include the following reports:
• Statement of Net Position
• Statement of Revenues, Expenditures and Changes in Net Position • Statement of Cash Flows
In addition, Staff is reporting the Actual vs. Budget variances year to date ending April 30 2024.
Financial Statements for the period April 1, 2024 – April 30 2024 In the Statement of Net Position, VCE, as of April 30, 2024, has a total of $35,103,442 in its checking, money market and lockbox accounts, $1,100,000 restricted assets for the Debt Service Reserve account, and $1,800,000 restricted assets related to supplier deposits. On April 30 2022, VCE’s net position was $41,513,659.
In the Statement of Revenues, Expenditures, and Changes in Net Position, VCE recorded $ 6,213,328 of revenue (net of allowance for doubtful accounts), of which $6,014,268 was billed in April, and $4,789,993 represent estimated unbilled revenue. The cost of electricity for the April revenue totaled $7,753,833.
For April, VCE’s gross margin was approximately 32% and the net loss totaled $2,186 ,604. The year-to-date change in net position was 5,090,484.
Item 5
In the Statement of Cash Flows, VCE cash flows from operations were $5,296,129 due to April cash receipts of revenues being more than the monthly cash operating expenses.
Actual vs. Budget Variances for the year to date ending April 30 2024 Below are the financial statement line items with variances >$50,000 and 5% • Electric Revenue – ($1,979,673) and -9% – Unfavorable variance due to retail load variance lower than forecasted due to mild and wet winter.
• Purchased Power – ($1,433,805) and -8% – Favorable mainly due to budgeted renewable energy certificates not procured, lower load due to mild and wet winter, and lower energy prices. • Reimbursable Revenues $607,000 (AgFIT) – Unfavorable Variance - Reimbursable AgFIT revenues and associated program costs expected in May resulting in budget timing differences. • General Programs Costs $131,628 – Favorable Variance – Budgeted program costs are amortized for the year resulting in timing differences.
• AgFIT Programs Costs $431,814 (AgFIT) – Favorable Variance – Program costs are expected in May resulting in budget timing differences.
• Operational Support Services $63,274 – Unfavorable Variance – Additional costs related to rate discount implementation and collections program implementation.
• Banking Fees $62,432 – Unfavorable Variance – Letter of credit costs offset costs savings from reduction of power purchase agreement rate.
Attachments:
1) Financial Statements (Unaudited) April 1, 2024 to April 30 2024 (with comparative year to date information.)
2) Actual vs. Budget for the year to date ending April 30 2024
VALLEY CLEAN ENERGY ALLIANCE
FINANCIAL STATEMENTS
(UNAUDITED)
FOR THE PERIOD OF APRIL 1 TO APRIL 30, 2024
PREPARED ON JUNE 7, 2024
2 ASSETS
Current assets:
Cash and cash equivalents $ 35,103,442
Accounts receivable, net of allowance 8,900,057
Accrued revenue 4,789,993
Prepaid expenses 111,272
Inventory - Renewable Energy Credits -
Other current assets and deposits 3,700,487
Total current assets 52,605,251
Restricted assets:
Debt service reserve fund 1,100,000
Total restricted assets 1,100,000
TOTAL ASSETS $ 53,705,251
LIABILITIES
Current liabilities:
Accounts payable $ 437,486
Accrued payroll 127,971
Interest payable -
Due to member agencies (1,723)
Accrued cost of electricity 7,723,862
Other accrued liabilities 2,059,295
Security deposits - energy supplies 1,800,000
User taxes and energy surcharges 44,700
TOTAL LIABILITIES $ 12,191,592
NET POSITION
Net position:
Local Programs Reserve $ 840,000
Restricted 1,100,000
Unrestricted 39,573,659
TOTAL NET POSITION $ 41,513,659
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF NET POSITION
APRIL 30, 2024
(UNAUDITED)
3 FOR THE
PERIOD ENDING
APRIL 30, 2024 YEAR TO DATE
OPERATING REVENUE
Electricity sales, net $ 6,213,328 $ 26,417,297
Other revenue - -
TOTAL OPERATING REVENUES 6,213,328 26,417,297
OPERATING EXPENSES
Cost of electricity 7,753,833 19,267,804
Contract services 342,869 946,134
Staff compensation 134,651 581,240
General, administration, and other 230,759 752,774
TOTAL OPERATING EXPENSES 8,462,112 21,547,952
TOTAL OPERATING INCOME (LOSS) (2,248,784) 4,869,345
NONOPERATING REVENUES (EXPENSES)
Interest income 62,181 221,138
Interest and related expenses - -
Other Non Operating Revenues - -
TOTAL NONOPERATING REVENUES (EXPENSES) 62,181 221,138
CHANGE IN NET POSITION (2,186,604) 5,090,484
Net position at beginning of period 5,714,148 36,423,176 Net position at end of period $ 3,527,544 $ 41,513,659
(WITH COMPARATIVE YEAR TO DATE INFORMATION)
(UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENT OF REVENUES, EXPENDITURES AND
APRIL 30, 2024
4 FOR THE
PERIOD ENDING
APRIL 30, 2024 YEAR TO DATE
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from electricity sales $ 6,213,328 $ 26,417,297 Payments received from other revenue sources - -
Receipts for security deposits with energy suppliers - - Payments to purchase electricity (208,919) (8,712,522)
Payments for contract services, general, and adminstration (573,628) (1,698,908) Payments for member agency services - -
Payments for staff compensation (134,651) (581,240)
Return of security deposits to energy suppliers - -
Other cash payments - -
Net cash provided (used) by operating activities 5,296,129 15,424,628
CASH FLOWS FROM NON-CAPITAL FINANCING ACTIVITIES
Principal payments of Debt - -
Interest and related expenses - -
Other Non Operating Revenue - -
Net cash provided (used) by non-capital financing activities - -
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES Acquisition of nondepreciable assets
Acquisition of capital assets
Net cash provided (used) by capital and related financing activities
CASH FLOWS FROM INVESTING ACTIVITIES
Interest income 62,181 221,138
Net cash provided (used) by investing activities 62,181 221,138 NET CHANGE IN CASH AND CASH EQUIVALENTS 5,358,310 15,645,766 Cash and cash equivalents at beginning of period 30,845,132 28,579,933 Cash and cash equivalents at end of period 36,203,442 44,225,699 Cash and cash equivalents included in:
Cash and cash equivalents 35,103,442 43,125,699
Restricted assets 1,100,000 1,100,000
Cash and cash equivalents at end of period $ 36,203,442 $ 44,225,699 (UNAUDITED)
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
APRIL 30, 2024
(WITH YEAR TO DATE INFORMATION)
5 FOR THE
PERIOD ENDING
APRIL 30, 2024 YEAR TO DATE
Operating Income (Loss) $ (2,248,784) $ 5,613,073
Depreciation expense
Revenue reduced for uncollectible accounts
(Increase) decrease in net accounts receivable (263,042) (593,095.56) (Increase) decrease in accrued revenue 290,598 313,839.15 (Increase) decrease in prepaid expenses 52,056 (5,880.34) (Increase) decrease in inventory - renewable energy credits - - (Increase) decrease in other assets and deposits 24,606 15,756.69 Increase (decrease) in accounts payable (18,360) (54,547.41) Increase (decrease) in accrued payroll (18,439) (25,888.91) Increase (decrease) in due to member agencies - 5,855.40 Increase (decrease) in accrued cost of electricity 7,490,604 (1,645,382.32) Increase (decrease) in other accrued liabilities - -
Increase (decrease )security deposits with energy suppliers - - Increase (decrease) in user taxes and energy surcharges - - Increase (decrease) in security deposits from energy suppliers - - Increase (decrease) in user taxes due to other governments (13,109) 16,094.60 Increase (decrease) in advances from public purpose programs - Net cash provided (used) by operating activities $ 5,296,129 $ 3,639,825
RECONCILIATION OF OPERATING INCOME TO NET CASH
PROVIDED (USED) BY OPERATING ACTIVITIES
Adjustments to reconcile operating income to net cash provided (used) by
VALLEY CLEAN ENERGY ALLIANCE
STATEMENTS OF CASH FLOWS
(WITH YEAR TO DATE INFORMATION)
(UNAUDITED)
APRIL 30, 2024
VALLEY CLEAN ENERGY
2024 YTD ACTUAL VS. BUDGET
FOR THE YEAR TO DATE ENDING 04/30/24
Description YTD Actuals YTD Budget YTD Variance
% over
/-under
Total Revenues $ 26,638,465 $ 29,169,000 $ (2,530,535) -9% Electric Revenue $ 26,417,327 $ 28,397,000 $ (1,979,673) -7% Interest Revenues $ 221,139 $ 165,000 $ 56,139 34%
Reimbursable Revenues $ - $ 607,000 $ (607,000) -100%
Purchased Power $ 19,267,805 $ 17,834,000 $ 1,433,805 8% Purchased Power Base $ 19,267,805 $ 16,984,000 $ 2,283,805 13% Purchased Power Contingency 5% $ - $ 850,000 $ (850,000) -100% Labor & Benefits $ 596,312 $ 544,000 $ 52,312 10%
Salaries & Wages/Benefits $ 481,378 $ 448,000 $ 33,378 7% Contract Labor $ 52,891 $ 68,000 $ (15,109) -22%
Human Resources & Payroll $ 62,043 $ 28,000 $ 34,043 122% Office Supplies & Other Expenses $ 108,632 $ 118,300 $ (9,668) -8% Technology Costs $ 37,062 $ 12,800 $ 24,262 190%
Office Supplies $ 5,832 $ 4,000 $ 1,832 46%
Travel $ 17,772 $ 21,500 $ (3,728) -17%
CalCCA Dues $ 45,976 $ 48,000 $ (2,024) -4%
CC Power $ - $ 30,000 $ (30,000) -100%
Memberships $ 1,990 $ 2,000 $ (10) -1%
Contractual Services $ 845,345 $ 775,600 $ 69,745 9%
Other Contract Services (e.g. IRP) $ - $ 10,000 $ (10,000) -100% Don Dame $ 1,443 $ 7,200 $ (5,757) -80%
Wholesale Energy Services (TEA) $ 253,075 $ 273,000 $ (19,925) -7% 2030 100% Renewable & Storage $ - $ 10,000 $ (10,000) -100% Customer Support Call Center $ 381,490 $ 268,000 $ 113,490 42% Operating Services $ 83,274 $ 20,000 $ 63,274 316%
Commercial Legal Support $ (3,128) $ 8,000 $ (11,128) -139% Legal General Counsel $ 15,294 $ 28,000 $ (12,706) -45% Regulatory Counsel $ 43,667 $ 68,000 $ (24,333) -36%
Joint CCA Regulatory counsel $ 31,334 $ 6,400 $ 24,934 390% Legislative - (Lobbyist) $ 24,251 $ 23,000 $ 1,251 5%
Accounting Services $ (5,855) $ 1,000 $ (6,855) -686%
Financial Consultant $ - $ 8,000 $ (8,000) -100%
Audit Fees $ 20,500 $ 45,000 $ (24,500) -54%
Marketing $ 59,247 $ 100,000 $ (40,753) -41%
Marketing Collateral $ 59,247 $ 96,000 $ (36,753) -38%
Community Engagement Activities & Sponsorships $ - $ 4,000 $ (4,000) -100% Programs $ 356,558 $ 926,000 $ (569,442) -61%
Program Costs (Rebates, Incentives, etc.) $ 108,372 $ 240,000 $ (131,628) -55% AG Fit $ 248,186 $ 680,000 $ (431,814) -64%
PIPP Program $ - $ 6,000 $ (6,000) -100%
Rents & Leases $ 19,890 $ 16,400 $ 3,490 21%
Hunt Boyer Mansion $ 19,890 $ 8,400 $ 11,490 137%
Lease Improvement $ - $ 8,000 $ (8,000) -100%
Other A&G $ 247,798 $ 221,600 $ 26,198 12%
Development - New Members $ - $ 8,400 $ (8,400) -100%
Strategic Plan Implementation $ 5,235 $ 25,600 $ (20,365) -80% PG&E Data Fees $ 89,189 $ 96,000 $ (6,811) -7%
Insurance $ 15,342 $ 16,000 $ (658) -4%
Banking Fees $ 138,032 $ 75,600 $ 62,432 83%
Miscellaneous Operating Expenses $ 754 $ 4,000 $ (3,246) -81% Contingency $ - $ 80,000 $ (80,000) -100%
0 0
TOTAL OPERATING EXPENSES $ 21,502,340 $ 20,619,900 $ 882,440 4% Interest on RCB Term loan $ - $ - $ - 100%
Interest Expense - Bridge Loan \ Line of Credit $ - $ - $ - 100% NET INCOME $ 8,549,100 5,136,125 $ (3,412,975) $