shelby energy cooperative, inc. 2006 load forecast prepared by: east kentucky power cooperative,...

Shelby Energy Cooperative, Inc.

2006 Load Forecast

Prepared by:East Kentucky Power Cooperative, Inc.

Forecasting and Market Analysis Department

July 2006

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Blank PageBlank Page

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Table of Contents• Introduction and Executive Summary

5• Narrative

17• Key Assumptions

22• Methodology and Results

30– Residential Forecast 35– Small Commercial 40– Large Commercial 42– Other 44– Peak Day Weather Scenarios 47

• RUS Form 341 50

Page Number

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5

IntroductionExecutive Summary

Shelby Energy Cooperative, Inc., (Shelby Energy), located in Shelbyville, Kentucky, is an electric distribution cooperative that serves members in ten counties. This load forecast report contains Shelby Energy’s long-range forecast of energy and peak demand.

Shelby Energy and its power supplier, East Kentucky Power Cooperative (EKPC), worked jointly to prepare the load forecast. Factors considered in preparing the forecast include the national and local economy, population and housing trends, service area industrial development, electric price, household income, weather, and appliance efficiency changes.

EKPC prepared a preliminary load forecast, which was reviewed by Shelby Energy for reasonability. Final projections reflect a rigorous analysis of historical data combined with the experience and judgment of the manager and staff of Shelby Energy. Key assumptions are reported beginning on page 22.

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7

Executive Summary (continued)

The load forecast is prepared biannually as part of the overall planning cycle at EKPC and Shelby Energy. Cooperation helps to ensure that the forecast meets both parties’ needs. Shelby Energy uses the forecast in developing two-year work plans, long-range work plans, and financial forecasts. EKPC uses the forecast in areas of marketing analysis, transmission planning, generation planning, demand-side planning, and financial forecasting.

The complete load forecast for Shelby Energy is reported in Table 1-1. Residential and commercial sales, total purchases, winter and summer peak demands, and load factor are presented for the years 1990 through 2025.

8

Year

ResidentialSales

(MWh)

SeasonalSales

(MWh)

SmallComm.Sales

(MWh)

Public Buildings (MWh)

LargeComm.Sales

(MWh)

OtherSales

(MWh)

TotalSales

(MWh)

OfficeUse

(MWh)%

Loss

PurchasedPower(MWh)

1990 106,787 102 30,260 0 57,281 70 194,500 359 4.1 203,0971991 116,303 102 34,392 0 66,686 71 217,554 397 5.3 230,1971992 115,434 96 38,662 0 74,643 71 228,906 375 5.0 241,2371993 127,884 95 38,996 0 84,827 70 251,872 404 5.2 266,1141994 129,002 85 46,641 0 98,982 38 274,748 229 4.9 289,2801995 139,454 101 48,181 0 109,589 40 297,365 0 6.1 316,6291996 151,904 289 48,824 0 117,243 48 318,309 0 4.4 333,0111997 154,886 254 42,481 0 130,728 47 328,396 408 4.6 344,4831998 160,145 244 51,463 0 136,010 48 347,911 0 4.3 363,4611999 171,819 276 52,630 0 143,726 67 368,519 0 4.2 384,6302000 178,985 296 55,147 0 155,300 74 389,802 0 5.4 412,1702001 187,641 0 62,077 0 151,961 79 401,757 0 2.9 413,6902002 202,023 0 54,282 0 165,004 89 421,398 0 3.4 436,2482003 203,175 0 56,043 0 158,524 136 417,877 0 4.1 435,5742004 208,249 0 60,589 0 156,375 129 425,342 0 4.4 444,9192005 224,903 0 65,812 0 153,931 120 444,765 0 3.2 459,2362006 222,461 0 69,095 0 157,272 128 448,956 0 4.2 468,6392007 231,444 0 70,956 0 160,584 133 463,116 0 4.2 483,4202008 238,603 0 73,191 0 163,708 135 475,638 0 4.2 496,4902009 246,605 0 75,427 0 166,664 136 488,832 0 4.2 510,2632010 254,067 0 77,712 0 169,467 136 501,382 0 4.2 523,3642011 260,459 0 79,980 0 172,133 136 512,709 0 4.2 535,1862012 268,060 0 82,329 0 174,675 136 525,201 0 4.2 548,2262013 275,804 0 84,566 0 177,105 136 537,611 0 4.2 561,1812014 282,824 0 86,850 0 179,433 136 549,244 0 4.2 573,3242015 289,260 0 89,119 0 181,671 136 560,186 0 4.2 584,7452016 295,893 0 91,468 0 183,826 136 571,323 0 4.2 596,3712017 302,813 0 93,704 0 185,907 136 582,561 0 4.2 608,1012018 310,208 0 95,988 0 187,920 136 594,253 0 4.2 620,3062019 317,805 0 98,257 0 198,138 136 614,337 0 4.2 641,2702020 326,229 0 100,606 0 200,036 136 627,008 0 4.2 654,4972021 334,607 0 102,889 0 201,886 136 639,518 0 4.2 667,5562022 342,793 0 105,174 0 203,690 136 651,794 0 4.2 680,3692023 350,856 0 107,458 0 205,455 136 663,906 0 4.2 693,0122024 359,472 0 109,743 0 207,183 136 676,535 0 4.2 706,1952025 367,207 0 112,028 0 208,879 136 688,250 0 4.2 718,424

2006 Load ForecastShelby Energy Cooperative

MWh Summary

Table 1-1

9

Winter Summer

Season

NoncoincidentPeak Demand

(MW) Year

NoncoincidentPeak Demand

(MW) Year

PurchasedPower(MWh)

Load Factor(%)

1989 - 90 45.4 1990 39.4 1990 203,097 51.1%1990 - 91 45.9 1991 45.3 1991 230,197 57.3%1991 - 92 51.3 1992 46.8 1992 241,237 53.5%1992 - 93 53.5 1993 51.4 1993 266,114 56.8%1993 - 94 63.8 1994 60.8 1994 289,280 51.8%1994 - 95 71.2 1995 62.1 1995 316,629 50.8%1995 - 96 72.8 1996 69.0 1996 333,011 52.1%1996 - 97 69.2 1997 66.4 1997 344,483 56.8%1997 - 98 75.4 1998 73.3 1998 363,461 55.0%1998 - 99 80.9 1999 76.9 1999 384,630 54.3%1999 - 00 83.1 2000 78.4 2000 412,170 56.5%2000 - 01 95.1 2001 81.8 2001 413,690 49.7%2001 - 02 85.0 2002 83.8 2002 436,248 58.6%2002 - 03 96.1 2003 81.3 2003 435,574 51.7%2003 - 04 96.5 2004 81.4 2004 444,919 52.5%2004 - 05 96.6 2005 88.7 2005 459,236 54.3%2005 - 06 95.2 2006 86.8 2006 468,639 56.2%2006 - 07 105.8 2007 88.5 2007 483,420 52.2%2007 - 08 108.5 2008 90.5 2008 496,490 52.1%2008 - 09 112.0 2009 93.1 2009 510,263 52.0%2009 - 10 115.0 2010 95.3 2010 523,364 51.9%2010 - 11 117.7 2011 97.3 2011 535,186 51.9%2011 - 12 120.4 2012 99.2 2012 548,226 51.9%2012 - 13 123.7 2013 101.7 2013 561,181 51.8%2013 - 14 126.6 2014 103.7 2014 573,324 51.7%2014 - 15 129.2 2015 105.6 2015 584,745 51.7%2015- 16 131.4 2016 107.3 2016 596,371 51.7%2016 - 17 134.5 2017 109.6 2017 608,101 51.6%2017 - 18 137.4 2018 111.7 2018 620,306 51.6%2018 - 19 141.8 2019 115.4 2019 641,270 51.6%2019-2020 144.4 2020 117.3 2020 654,497 51.6%2020-2021 147.8 2021 119.8 2021 667,556 51.5%2021-2022 150.8 2022 122.0 2022 680,369 51.5%2022-2023 153.7 2023 124.1 2023 693,012 51.5%2023-2024 156.2 2024 126.0 2024 706,195 51.5%2024-2025 159.5 2025 128.5 2025 718,424 51.4%

Shelby Energy Cooperative2006 Load Forecast

Peaks Summary

Table 1-1 (continued)

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11

Executive Summary (continued)

Overall Results

• Total sales are projected to grow by 2.2 percent a year for the period 2005-2025, compared to a 3.4 percent growth projected in the 2004 load forecast for the period 2004-2024. Results shown in Table 1-2 and Figure 1-1.

• Winter and summer peak demands for the same period indicate annual growth of 2.6 and 2.0 percent, respectively. Annual peaks shown in Figure 1-2.

• Load factor will remain steady at approximately 52% for the forecast period. See Figure 1-3.

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Executive SummaryOverall Results (continued)

TimePeriod Residential

Small Commercial

Large Commercial Other

Total Sales

1995-2000 5.1% 2.7% 7.2% 13.2% 5.6%2000-2005 4.7% 3.6% -0.2% 10.0% 2.7%2005-2010 2.5% 3.4% 1.9% 2.6% 2.4%2010-2015 2.6% 2.8% 1.4% 0.0% 2.2%2015-2020 2.4% 2.5% 1.9% 0.0% 2.3%2020-2025 2.4% 2.2% 0.9% 0.0% 1.9%

1995-2005 4.9% 3.2% 3.5% 11.6% 4.1%2005-2015 2.5% 3.1% 1.7% 1.3% 2.3%2015-2025 2.4% 2.3% 1.4% 0.0% 2.1%

5 Year Growth Rates

Table 1-2Shelby Energy Cooperative

2006 Load ForecastSummary of Sales Growth

10 Year Growth Rates

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Figure 1-1 Average Annual Growth in Sales 2005-2025

2.5%2.7%

1.5%

2.2%

0.7%

0%

1%

2%

3%

4%

5%

6%

Residential Small Commercial

Large Commercial

Other Total Sales

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Figure 1-2Peak Demand Forecast Winter and Summer

0

50

100

150

200

1990 1995 2000 2005 2010 2015 2020 2025

Su

m O

f S

ub

stat

ion

s P

eak

Dem

and

(M

W)

Winter History Winter Forecast Summer History Summer Forecast

15

Figure 1-3Annual System Load Factor

0%

10%

20%

30%

40%

50%

60%

70%

1990 1995 2000 2005 2010 2015 2020 2025

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17

Narrative

Shelby Energy Cooperative is located in North Central Kentucky between Louisville and Lexington. The cooperative serves major portions of Carroll, Henry, Shelby and Trimble Counties with a few members in six surrounding counties. The headquarters is located in Shelbyville, Kentucky (Shelby County), with an office in Bedford, Kentucky (Trimble County).

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Narrative (continued)Counties Served

Shelby Energy provides service to members in 10 counties.

Figure 1-4

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000

Other Counties (7)

Trimble County

Shelby County

Henry County

Number of Members

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Narrative (continued)Three of the principal counties served by Shelby Energy are strictly rural with a high percentage of people relying on agricultural enterprises for income. Agricultural products include tobacco, dairy, corn, beef cattle and swine. Tobacco and beef cattle are the prime sources of farm income.

Shelby County has grown significantly in the commercial and industrial classification. Approximately 40 percent of the Cooperative’s energy sales are from large industrial consumers in the Shelby County area.

Shelby County is centrally located and has interstate highway and rail ties to major automotive manufacturing facilities in Indiana, Ohio, Tennessee, and Kentucky. Automotive component manufacturers have built plants in industrial parks in the area. Other industries have also chosen the area due to its central location. Attracting small and medium-sized plants with a diversity of product lines has helped develop additional financial stability.

Future expansion of these industrial parks will occur primarily in Shelby Energy’s territory as defined by certified territorial agreements established in 1972. The industrial jobs will generate a greater need for residences and consumer services provided by commercial establishments.

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Narrative (continued) A near “natural unemployment rate” in Shelby County continues to challenge further industrial growth. A shortage of skilled laborers is challenging existing industries as they plan expansions. The location of a new technical school/community college near Shelbyville is expected to help alleviate this problem. The lack of available, affordable housing may also stand in the way of attracting the work force needed for existing industries to expand and new industries to continue to locate in the area.

The other counties serve as “bedroom” communities to surrounding metropolitan areas. Commercial and industrial growth is expected to be limited in these counties. Henry County, however, is developing an active, if not aggressive commercial and industrial development group that is experiencing some success in attracting commercial and industrial activity to its communities. Access to Interstate highway and rail service are two of Henry County’s key assets. Henry County also has a semi-skilled to non-skilled workforce that has yet to be fully developed and utilized in light and heavy industry.

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Narrative (continued) Shelby Energy MembersDemographic Information

• There is an average of 2.34 people per household.

• 56% of all homes are headed by someone age 55 or greater.

• Nearly 36% of homes have farm operations, with beef cattle most prevalent.

• 30% of all homes served are less than 10 years old.

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Key AssumptionsPower Cost and Rates

• EKPC’s wholesale power cost forecast used in this load forecast comes from the following report: “Twenty-Year Financial Forecast, Equity Development Plan, 2006-2025”, dated January 2006.

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Key Assumptions (continued)Economic

(%) Change

(%) Change

(%) Change

(%) Change

(%) Change

(%) Change

(%) Change

1990 964,002 0.4% 494,930 -2.0% 468,383 3.1% 5.0% -11.5% $29,174 -0.6% $26,677 0.5% $27,673 0.0%

1991 967,773 0.4% 487,991 -1.4% 467,253 -0.2% 6.1% 20.4% $29,239 0.2% $26,826 0.6% $27,719 0.2%

1992 975,464 0.8% 492,143 0.9% 474,695 1.6% 5.5% -9.1% $30,554 4.5% $27,908 4.0% $28,610 3.2%

1993 990,659 1.6% 500,123 1.6% 494,158 4.1% 4.9% -11.4% $30,764 0.7% $28,023 0.4% $28,287 -1.1%

1994 1,000,603 1.0% 507,991 1.6% 506,843 2.6% 4.3% -12.8% $30,164 -2.0% $28,625 2.1% $28,608 1.1%

1995 1,009,902 0.9% 518,420 2.1% 517,747 2.2% 4.5% 4.7% $30,981 2.7% $29,253 2.2% $28,966 1.3%

1996 1,015,901 0.6% 518,000 -0.1% 526,646 1.7% 4.6% 2.8% $31,439 1.5% $29,995 2.5% $29,526 1.9%

1997 1,024,142 0.8% 533,730 3.0% 534,561 1.5% 4.5% -2.7% $32,041 1.9% $30,730 2.4% $30,006 1.6%

1998 1,032,925 0.9% 539,000 1.0% 547,361 2.4% 3.6% -19.1% $33,452 4.4% $32,828 6.8% $31,781 5.9%

1999 1,043,819 1.1% 552,734 2.5% 559,653 2.2% 3.8% 5.6% $34,438 2.9% $33,450 1.9% $32,045 0.8%

2000 1,054,288 1.0% 562,907 1.8% 565,970 1.1% 3.6% -5.9% $34,533 0.3% $34,917 4.4% $33,119 3.4%

2001 1,060,834 0.6% 554,875 -1.4% 556,479 -1.7% 4.7% 31.5% $34,714 0.5% $34,604 -0.9% $32,620 -1.5%

2002 1,067,926 0.7% 545,484 -1.7% 543,802 -2.3% 5.5% 16.5% $35,106 1.1% $35,945 3.9% $33,659 3.2%

2003 1,076,288 0.8% 537,325 -1.5% 540,482 -0.6% 5.9% 8.2% $35,596 1.4% $36,356 1.1% $33,779 0.4%

2004 1,084,605 0.8% 542,116 0.9% 547,046 1.2% 5.1% -14.6% $35,996 1.1% $36,867 1.4% $33,991 0.6%

2005 1,091,625 0.6% 548,273 1.1% 556,333 1.7% 5.1% 0.3% $36,426 1.2% $37,469 1.6% $34,324 1.0%

2006 1,098,806 0.7% 554,161 1.1% 565,105 1.6% 5.1% 0.2% $35,996 -1.2% $38,047 1.5% $34,626 0.9%

2007 1,106,385 0.7% 559,643 1.0% 573,065 1.4% 5.1% 0.5% $36,426 1.2% $38,629 1.5% $34,914 0.8%

2008 1,113,740 0.7% 565,297 1.0% 581,383 1.5% 5.1% -0.6% $36,769 0.9% $39,159 1.4% $35,160 0.7%

2009 1,121,504 0.7% 570,169 0.9% 588,219 1.2% 5.0% -1.0% $37,042 0.7% $39,666 1.3% $35,368 0.6%

2010 1,129,719 0.7% 574,165 0.7% 593,399 0.9% 5.0% 0.1% $37,281 0.6% $40,102 1.1% $35,498 0.4%

2015 1,171,623 0.7% 592,266 0.6% 615,771 0.7% 5.0% -0.1% $38,370 0.6% $42,070 1.0% $35,907 0.2%

2020 1,216,391 0.8% 617,126 0.8% 649,461 1.1% 5.0% -0.2% $38,995 0.3% $44,473 1.1% $36,562 0.4%

2025 1,267,709 0.8% 644,495 0.9% 686,080 1.1% 5.0% 0.2% $39,474 0.2% $46,981 1.1% $37,060 0.3%

2030 1,320,322 0.8% 670,189 0.8% 719,430 1.0% 5.0% -0.1% $39,946 0.2% $49,359 1.0% $37,384 0.2%

Notes: Wages & Per Capita Income are in constant 2006 dollars; Income is in millions of constant 2005 dollars.

Growth rates are average annual changes. Data for 2004 and 2005 are simulated.

Regional SummaryCentral North Economic Region History and Forecast

Unemployment Rate

Regional Income

Population Labor ForceTotal

EmploymentAverage Real

Wages

Forecast

Long-Term Forecast

Actual

Real Per Capita Income

EKPC’s source for economic forecasts is DRI-WEFA.

24

Key Assumptions (continued)Share of Regional Homes Served

Figure 1-5

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

1986

1987

1988

1989

1990

1991

1993

1994

1995

1996

1997

1998

2000

2001

2002

2003

2004

2005

2007

2008

2009

2010

2011

2012

2014

2015

2016

2017

2018

2019

2021

2022

2023

2024

2025

Sh

are

(%)

25

Key Assumptions (continued)Household IncomeMembers’ Greatest Sources

Figure 1-6

Agriculture10%

Education5%

Construction6%

Manufacturing15%

Retail & Service13%

Retirement37%

Other14%

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Key Assumptions (continued)Appliance Saturations

• .

• .

• Room air conditioner saturation is declining due to customers choosing central air conditioning systems.

• .

• Appliance efficiency trends are accounted for in the model. The data is collected from Energy Information Administration, (EIA). See Figure 1-7.

27

Key Assumptions (continued)Saturation Rates Non HVAC Appliances

• Microwave Oven 99%

• Electric Range 95%

• Dishwasher 65%

• Freezer 64%

• Clothes Dryer 97%

• Personal Computer 64%

28

Figure 1-7

Key Assumptions (continued)

Residential Appliance Efficiency Trends East South Central Region

0

2

4

6

8

10

12

14

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Eff

icie

ncy

Rat

ing

Heat Pump Heating (HSPF)

Heat Pump Cooling (SEER)

Central Air (SEER)

Room Air (EER)

Water Heating (EF)

All of the projections are very similar to what was used in the 2004 Load Forecast. However, the 2004 Load Forecast assumption was just below 8 by 2024 whereas this update shows the trend continuing above 8.

Source: Energy Information Administration (EIA) Efficiency Trend Update, 2005

29

Key Assumptions (continued)Weather

• Weather data is from the Louisville weather station.

• Normal weather, a 30-year average of historical temperatures, is assumed for the forecast years.

30

Methodology and ResultsIntroduction

This section briefly describes the methodology used to develop the load forecast and presents results in tabular and graphical form for residential and commercial classifications. Table 1-3 through Table 1-5 shows historical data for Shelby Energy as reported on RUS Form 736 and RUS Form 5.

A preliminary forecast is prepared during the first quarter depending on when Shelby Energy experiences its winter peak. The first step is modeling the regional economy. Population, income, and employment are among the areas analyzed. The regional model results are used in combination with the historical billing information, appliance saturation data, appliance efficiency data, and weather data to develop the long range forecast.

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Table 1-3

YearkWh Purchased

And GeneratedChange kWh Sold Change kWh Loss % Loss

Annual

Load

Factor

Average

Number Of

Consumers

Miles

Of

Line

Consumers

Per Mile

Cost Of

Purchased Power

Cents

/ kWh

1993 266,113,875 251,872,759 13,837,276 5.2% 56.0% 9,762 1,670 5.8 $10,255,879 3.9

1994 289,279,601 8.7% 274,748,155 9.1% 14,302,646 4.9% 51.7% 10,125 1,694 6.0 $11,185,801 3.9

1995 316,629,157 9.5% 297,365,445 8.2% 19,263,712 6.1% 58.0% 10,534 1,724 6.1 $10,539,436 3.3

1996 333,011,306 5.2% 318,308,748 7.0% 14,702,558 4.4% 54.2% 10,906 1,751 6.2 $10,403,370 3.1

1997 344,483,454 3.4% 328,396,178 3.2% 15,679,392 4.6% 56.3% 11,290 1,786 6.3 $10,695,791 3.1

1998 363,461,071 5.5% 347,910,938 5.9% 15,550,133 4.3% 61.1% 11,702 1,813 6.5 $11,290,342 3.1

1999 384,629,787 5.8% 368,518,320 5.9% 16,111,467 4.2% 59.8% 12,150 1,846 6.6 $12,503,621 3.3

2000 412,169,946 7.2% 389,801,503 5.8% 22,368,443 5.4% 56.6% 12,635 1,874 6.7 $13,892,586 3.4

2001 413,689,602 0.4% 401,756,710 3.1% 11,932,892 2.9% 56.2% 13,022 1,901 7.0 $15,059,945 3.8

2002 436,247,692 5.5% 421,397,941 4.9% 14,849,751 3.4% 55.9% 13,395 1,929 6.9 $15,571,724 3.6

2003 435,573,609 -0.2% 417,876,836 -0.8% 17,696,773 4.1% 55.1% 13,727 1,951 7.0 $16,462,020 3.8

2004 444,919,262 2.1% 425,341,706 1.8% 19,577,556 4.4% 54.1% 14,087 1,978 7.1 $18,478,585 4.2

2005 459,236,149 3.2% 451,448,346 6.1% 7,787,803 1.7% 56.0% 14,725 2,008 7.3 $22,823,559 5.0

4.2% 3.7

93.8

93.7

83.2

84.1

89.1

90.2

Average

Shelby Energy Comparative Annual Operating DataPeak

Demand

(MW)

54.3

63.9

62.3

69.8

70.2

67.9

73.4

32

Table 1-4

Year kWh Sales%

ChangekWh Sales % Change kWh Sales

%

ChangekWh Sales

%

ChangekWh Sales

%

Change

kWh

Sales

%

Change

1993 127,884,350 95,363 38,996,360 84,826,702 69,984

1994 129,001,815 0.9% 85,317 -10.5% 46,641,014 19.6% 98,982,062 16.7% 37,947 -45.8%

1995 139,454,093 8.1% 101,273 18.7% 48,181,139 3.3% 109,588,896 10.7% 40,044 5.5%

1996 151,904,444 8.9% 288,601 185.0% 48,824,259 1.3% 117,243,456 7.0% 47,988 19.8%

1997 154,885,962 2.0% 254,210 -11.9% 42,480,868 -13.0% 130,728,326 11.5% 46,812 -2.5%

1998 160,145,321 3.4% 244,151 -4.0% 51,463,186 21.1% 136,010,256 4.0% 48,024 2.6%

1999 171,819,333 7.3% 276,492 13.2% 52,629,801 2.3% 143,726,105 5.7% 66,589 38.7%

2000 178,984,574 4.2% 296,065 7.1% 55,146,631 4.8% 155,299,743 8.1% 74,490 11.9%

2001 187,640,679 4.8% 0 -100.0% 62,076,536 12.6% 151,960,728 -2.2% 78,767 5.7%

2002 202,023,323 7.7% 0 0.0% 54,281,916 -12.6% 165,003,608 8.6% 89,094 13.1%

2003 203,175,125 0.6% 0 0.0% 56,042,518 3.2% 158,523,634 -3.9% 135,559 52.2%

2004 208,248,992 2.5% 0 0.0% 60,588,854 8.1% 156,374,940 -1.4% 128,920 -4.9%

2005 231,427,277 11.1% 0 0.0% 65,968,591 8.9% 153,930,610 -1.6% 121,868 -5.5%

2 Year 14,126,076 6.7% 4,963,037 8.5% -2,296,512 -1.5% -6,846 -5.2%

5 Year 10,488,541 5.3% 2,164,392 3.6% -273,827 -0.2% 9,476 10.3%

10 Year 9,197,318 5.2% 1,778,745 3.2% 4,434,171 3.5% 8,182 11.8%

Average Annual Change

Shelby Energy Comparative Annual Operating Data

Residential Residential Seasonal

Commercial /

I ndustrial

(1 MW Or Less)

Commercial /

I ndustrial

( Over 1 MW)

Public Street /

Highway Lighting

Public

Authorities

33

Table 1-5

Year Consumerskwh /

Mo.Consumers

kwh /

Mo.Consumers

kwh /

Mo.Consumers kwh / Mo. Consumers

kwh /

Mo.Consumers kwh / Mo.

1993 9,410 1,133 26 306 317 10,251 5 1,413,778 4 1,458

1994 9,766 1,101 26 273 323 12,033 6 1,374,751 4 791

1995 10,170 1,143 27 313 325 12,354 6 1,522,068 6 556

1996 10,508 1,205 52 463 329 12,367 7 1,395,755 10 400

1997 10,902 1,184 44 481 326 10,859 10 1,089,403 8 488

1998 11,322 1,179 41 496 321 13,360 10 1,133,419 8 500

1999 11,772 1,216 39 591 317 13,835 10 1,197,718 12 462

2000 12,244 1,218 48 514 319 14,406 10 1,294,165 14 443

2001 12,483 1,253 0 0 517 10,006 8 1,582,924 14 469

2002 12,820 1,313 0 0 552 8,195 8 1,718,788 15 495

2003 13,185 1,284 0 0 517 9,033 8 1,651,288 17 665

2004 13,558 1,280 0 0 500 10,098 8 1,628,906 21 512

2005 14,182 1,360 0 0 513 10,716 8 1,603,444 22 462

10 Year Avg. 401 22 19 -164 0 8,138 2 -9

5 Year Avg. 388 28 39 -738 0 61,856 2 4

2 Year Avg. 499 38 -2 841 0 -23,922 3 -101

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Consumers 356 404 338 394 420 450 472 239 337 365 373 624

kWh/ month -32 42 62 -21 -5 38 2 34 61 -29 -4 80

Annual Changes I n Shelby Energy's Residential Class

Shelby Energy Comparative Annual Operating Data

ResidentialResidential

Seasonal

Commercial /

I ndustrial

(1 MW Or Less)

Commercial /

I ndustrial

( Over 1 MW)

Public Street /

Highway LightingPublic Authorities

34

Methodology and Results (continued)

The preliminary forecast was presented to Shelby Energy staff, and reviewed by Rural Utilities Services (RUS) Field Representative. Changes were made to the forecast as needed based on new information, such as new large loads or subdivisions. In some instances, other assumptions were changed based on insights from Shelby Energy staff. Input from EKPC and Shelby Energy results in the best possible forecast.

35

Methodology and Results (continued)Residential Forecast

Residential customers are analyzed by means of regression analysis with resulting coefficients used to prepare customer projections. Regressions for residential customers are typically a function of regional economic and demographic variables. Two variables that are very significant are the numbers of households by county in each member system's economic region and the percent of total households served by the member system. Table 1-6 and Figure 1-8 report Shelby Energy’s customer forecast.

The residential energy sales were projected using a statistically adjusted end-use (SAE) approach. This method of modeling incorporates end-use forecasts and can be used to allocate the monthly and annual forecasts into end-use components. This method, like end-use modeling, requires detailed information about appliance saturation, appliance use, appliance efficiencies, household characteristics, weather characteristics, and demographic and economic information. The SAE approach segments the average household use into heating, cooling, and water heating end-use components. See Figure 1-9. This model accounts for appliance efficiency improvements. Table 1-6 reports Shelby Energy’s energy forecast.

36

Customers Use Per Customer Class Sales

AnnualAverage

AnnualChange

%Change

MonthlyAverage(kWh)

AnnualChange(kWh)

%Change

Total(MWh)

AnnualChange(MWh)

%Change

1990 8,472 1,050 106,7871991 8,755 283 3.3 1,107 57 5.4 116,303 9,516 8.91992 9,085 330 3.8 1,059 -48 -4.4 115,434 -869 -0.71993 9,410 325 3.6 1,133 74 7.0 127,884 12,450 10.81994 9,767 357 3.8 1,101 -32 -2.8 129,002 1,118 0.91995 10,170 403 4.1 1,143 42 3.8 139,454 10,452 8.11996 10,508 338 3.3 1,205 62 5.4 151,904 12,450 8.91997 10,902 394 3.7 1,184 -21 -1.7 154,886 2,982 2.01998 11,360 458 4.2 1,175 -9 -0.8 160,145 5,259 3.41999 11,772 412 3.6 1,216 42 3.5 171,819 11,674 7.32000 12,244 472 4.0 1,218 2 0.2 178,985 7,165 4.22001 12,483 239 2.0 1,253 34 2.8 187,641 8,656 4.82002 12,820 337 2.7 1,313 61 4.8 202,023 14,383 7.72003 13,185 365 2.8 1,284 -29 -2.2 203,175 1,152 0.62004 13,558 373 2.8 1,280 -4 -0.3 208,249 5,074 2.52005 13,900 342 2.5 1,348 68 5.3 224,903 16,654 8.02006 14,214 314 2.3 1,304 -44 -3.3 222,461 -2,443 -1.12007 14,557 343 2.4 1,325 21 1.6 231,444 8,983 4.02008 14,932 375 2.6 1,332 7 0.5 238,603 7,160 3.12009 15,308 376 2.5 1,342 11 0.8 246,605 8,002 3.42010 15,680 372 2.4 1,350 8 0.6 254,067 7,463 3.02011 16,052 372 2.4 1,352 2 0.1 260,459 6,391 2.52012 16,423 371 2.3 1,360 8 0.6 268,060 7,601 2.92013 16,794 371 2.3 1,369 8 0.6 275,804 7,744 2.92014 17,165 371 2.2 1,373 5 0.3 282,824 7,020 2.52015 17,535 370 2.2 1,375 2 0.1 289,260 6,435 2.32016 17,906 371 2.1 1,377 2 0.2 295,893 6,633 2.32017 18,276 370 2.1 1,381 4 0.3 302,813 6,920 2.32018 18,646 370 2.0 1,386 6 0.4 310,208 7,395 2.42019 19,017 371 2.0 1,393 6 0.5 317,805 7,597 2.42020 19,387 370 1.9 1,402 10 0.7 326,229 8,424 2.72021 19,758 371 1.9 1,411 9 0.6 334,607 8,378 2.62022 20,128 370 1.9 1,419 8 0.6 342,793 8,186 2.42023 20,498 370 1.8 1,426 7 0.5 350,856 8,063 2.42024 20,869 371 1.8 1,435 9 0.6 359,472 8,616 2.52025 21,240 371 1.8 1,441 5 0.4 367,207 7,735 2.2


Residential Summary

Table 1-6

37

Figure 1-8Annual Change in Residential Customers

0

100

200

300

400

500

1991 1996 2001 2006 2011 2016 2021

Nu

mb

er o

f C

ust

om

ers

38


39

Figure 1-9Shelby Energy

Residential MWh Usage, History and Forecast

0

10,000

20,000

30,000

40,000

Jan-99

Jul-99

Jan-00

Jul-00

Jan-01

Jul-01

Jan-02

Jul-02

Jan-03

Jul-03

Jan-04

Jul-04

Jan-05

Jul-05

Jan-06

Jul-06

Jan-07

Jul-07

Jan-08

Jul-08

Jan-09

Jul-09

Jan-10

Jul-10

MW

h

Other Usage Heating, Cooling and Water Heating Usage

40

Methodology and Results (continued)Small Commercial Forecast

Small commercial sales are projected using two equations, a customer equation and a small commercial sales equation. Both are determined through regression analysis and utilize inputs relating to the economy, electric price, and the residential customer forecast. Small commercial projections are reported in Table 1-7.

41


AnnualAverage

AnnualChange

%Change

AnnualAverage(MWh)

AnnualChange(MWh)

%Change

Total(MWh)

AnnualChange(MWh)

%Change

1990 276 110 30,2601991 292 16 5.8 118 8 7.4 34,392 4,132 13.71992 299 7 2.4 129 12 9.8 38,662 4,270 12.41993 317 18 6.0 123 -6 -4.9 38,996 334 0.91994 323 6 1.9 144 21 17.4 46,641 7,645 19.61995 325 2 0.6 148 4 2.7 48,181 1,540 3.31996 329 4 1.2 148 0 0.1 48,824 643 1.31997 326 -3 -0.9 130 -18 -12.2 42,481 -6,343 -13.01998 321 -5 -1.5 160 30 23.0 51,463 8,982 21.11999 317 -4 -1.2 166 6 3.6 52,630 1,167 2.32000 319 2 0.6 173 7 4.1 55,147 2,517 4.82001 517 198 62.1 120 -53 -30.5 62,077 6,930 12.62002 552 35 6.8 98 -22 -18.1 54,282 -7,795 -12.62003 517 -35 -6.3 108 10 10.2 56,043 1,761 3.22004 500 -17 -3.3 121 13 11.8 60,589 4,546 8.12005 504 4 0.8 131 9 7.8 65,812 5,223 8.62006 513 9 1.8 135 4 3.1 69,095 3,284 5.02007 522 9 1.8 136 1 0.9 70,956 1,861 2.72008 532 10 1.9 138 2 1.2 73,191 2,235 3.22009 542 10 1.9 139 2 1.2 75,427 2,236 3.12010 552 10 1.8 141 2 1.2 77,712 2,284 3.02011 562 10 1.8 142 2 1.1 79,980 2,269 2.92012 572 10 1.8 144 2 1.1 82,329 2,349 2.92013 582 10 1.7 145 1 1.0 84,566 2,236 2.72014 592 10 1.7 147 1 1.0 86,850 2,284 2.72015 602 10 1.7 148 1 0.9 89,119 2,269 2.62016 612 10 1.7 149 1 1.0 91,468 2,349 2.62017 622 10 1.6 151 1 0.8 93,704 2,236 2.42018 632 10 1.6 152 1 0.8 95,988 2,284 2.42019 641 9 1.4 153 1 0.9 98,257 2,269 2.42020 651 10 1.6 155 1 0.8 100,606 2,349 2.42021 661 10 1.5 156 1 0.7 102,889 2,283 2.32022 671 10 1.5 157 1 0.7 105,174 2,285 2.22023 681 10 1.5 158 1 0.7 107,458 2,285 2.22024 691 10 1.5 159 1 0.6 109,743 2,285 2.12025 701 10 1.4 160 1 0.6 112,028 2,285 2.1


Small Commercial Summary

Table 1-7

42

Methodology and Results (continued)Large Commercial Forecast

Large commercial customers are those with loads 1 MW or greater. Shelby Energy currently has 8 customers in this class and is projected to increase to 9 customers by 2025. Large commercial results are reported in Table 1-8.

43

Table 1-8


AnnualAverage

AnnualChange

%Change

Annual Average(MWh)

AnnualChange(MWh)

%Change

Total(MWh)

AnnualChange(MWh)

%Change

1990 5 11,456 57,2811991 4 -1 -20.0 16,672 5,215 45.5 66,686 9,405 16.41992 4 0 0.0 18,661 1,989 11.9 74,643 7,957 11.91993 5 1 25.0 16,965 -1,695 -9.1 84,827 10,184 13.61994 6 1 20.0 16,497 -468 -2.8 98,982 14,155 16.71995 6 0 0.0 18,265 1,768 10.7 109,589 10,607 10.71996 7 1 16.7 16,749 -1,516 -8.3 117,243 7,655 7.01997 10 3 42.9 13,073 -3,676 -21.9 130,728 13,485 11.51998 10 0 0.0 13,601 528 4.0 136,010 5,282 4.01999 10 0 0.0 14,373 772 5.7 143,726 7,716 5.72000 10 0 0.0 15,530 1,157 8.1 155,300 11,574 8.12001 8 -2 -20.0 18,995 3,465 22.3 151,961 -3,339 -2.22002 8 0 0.0 20,625 1,630 8.6 165,004 13,043 8.62003 8 0 0.0 19,815 -810 -3.9 158,524 -6,480 -3.92004 8 0 0.0 19,547 -269 -1.4 156,375 -2,149 -1.42005 8 0 0.0 19,241 -306 -1.6 153,931 -2,444 -1.62006 8 0 0.0 19,659 418 2.2 157,272 3,341 2.22007 8 0 0.0 20,073 414 2.1 160,584 3,312 2.12008 8 0 0.0 20,464 391 1.9 163,708 3,124 1.92009 8 0 0.0 20,833 369 1.8 166,664 2,956 1.82010 8 0 0.0 21,183 350 1.7 169,467 2,803 1.72011 8 0 0.0 21,517 333 1.6 172,133 2,666 1.62012 8 0 0.0 21,834 318 1.5 174,675 2,542 1.52013 8 0 0.0 22,138 304 1.4 177,105 2,430 1.42014 8 0 0.0 22,429 291 1.3 179,433 2,329 1.32015 8 0 0.0 22,709 280 1.2 181,671 2,237 1.22016 8 0 0.0 22,978 269 1.2 183,826 2,155 1.22017 8 0 0.0 23,238 260 1.1 185,907 2,081 1.12018 8 0 0.0 23,490 252 1.1 187,920 2,014 1.12019 9 1 12.5 22,015 -1,475 -6.3 198,138 10,217 5.42020 9 0 0.0 22,226 211 1.0 200,036 1,899 1.02021 9 0 0.0 22,432 205 0.9 201,886 1,849 0.92022 9 0 0.0 22,632 201 0.9 203,690 1,805 0.92023 9 0 0.0 22,828 196 0.9 205,455 1,765 0.92024 9 0 0.0 23,020 192 0.8 207,183 1,728 0.82025 9 0 0.0 23,209 188 0.8 208,879 1,696 0.8


Large Commercial Summary

44

Methodology and Results (continued)Other Forecast

Shelby Energy reports an ‘Other’ class which includes street lighting accounts. Results are reported in Table 1-9.

45

Table 1-9


AnnualAverage

AnnualChange

%Change

MonthlyAverage(kWh)

AnnualChange(kWh)

%Change

Total(MWh)

AnnualChange(MWh)

%Change

1990 3 1,944 701991 4 1 33.3 1,479 -465 -23.9 71 1 1.41992 4 0 0.0 1,479 0 0.0 71 0 0.01993 4 0 0.0 1,458 -21 -1.4 70 -1 -1.41994 4 0 0.0 791 -668 -45.8 38 -32 -45.81995 6 2 50.0 556 -234 -29.6 40 2 5.51996 10 4 66.7 400 -156 -28.1 48 8 19.81997 8 -2 -20.0 488 88 21.9 47 -1 -2.51998 8 0 0.0 500 12 2.5 48 1 2.51999 12 4 50.0 465 -35 -6.9 67 19 39.62000 14 2 16.7 443 -22 -4.7 74 7 11.22001 14 0 0.0 469 25 5.7 79 4 5.72002 15 1 7.1 495 26 5.6 89 10 13.12003 17 2 13.3 665 170 34.3 136 46 52.22004 21 4 23.5 512 -153 -23.0 129 -7 -4.92005 22 1 4.8 454 -58 -11.3 120 -9 -7.12006 22 0 0.0 486 32 7.1 128 9 7.12007 22 0 0.0 504 18 3.7 133 5 3.72008 22 0 0.0 512 7 1.5 135 2 1.52009 22 0 0.0 515 3 0.6 136 1 0.62010 22 0 0.0 516 1 0.3 136 0 0.32011 22 0 0.0 516 1 0.1 136 0 0.12012 22 0 0.0 517 0 0.0 136 0 0.02013 22 0 0.0 517 0 0.0 136 0 0.02014 22 0 0.0 517 0 0.0 136 0 0.02015 22 0 0.0 517 0 0.0 136 0 0.02016 22 0 0.0 517 0 0.0 136 0 0.02017 22 0 0.0 517 0 0.0 136 0 0.02018 22 0 0.0 517 0 0.0 136 0 0.02019 22 0 0.0 517 0 0.0 136 0 0.02020 22 0 0.0 517 0 0.0 136 0 0.02021 22 0 0.0 517 0 0.0 136 0 0.02022 22 0 0.0 517 0 0.0 136 0 0.02023 22 0 0.0 517 0 0.0 136 0 0.02024 22 0 0.0 517 0 0.0 136 0 0.02025 22 0 0.0 517 0 0.0 136 0 0.0


Other Summary

46


47

Methodology and Results (continued)Peak Day Weather Scenarios

Extreme temperatures can dramatically influence Shelby Energy’s peak demands. Table 1-10 and Figure 1-10 reports the impact of extreme weather on system demands.

48

Table 1-10

Winter Peak Day Minimum Temperatures Summer Peak Day Maximum Temperatures

Mild Normal Extreme Normal Extreme

Degrees 10 -3 -12 -17 -25 Degrees 94 98 100 104

Probability 99% 50% 20% 10% 3% Probability 50% 20% 10% 3%

Occurs Once Every 2 Years 5 Years 10 Years 30 Years 2 Years 5 Years 10 Years 30 Years

Noncoincident Winter Peak Demand - MW Noncoincident Summer Peak Demand - MW

Season Mild Normal Extreme Year Normal Extreme

2006 87 95 100 108

2006 - 07 96 106 112 116 122 2007 89 97 102 111

2007 - 08 99 108 115 119 125 2008 91 99 104 113

2008 - 09 102 112 119 123 129 2009 93 102 107 116

2009 - 10 105 115 122 126 133 2010 95 105 110 119

2010 - 11 107 118 125 129 136 2011 97 107 112 122

2011 - 12 109 120 128 132 139 2012 99 109 114 124

2012 - 13 112 124 132 136 143 2013 102 112 117 128

2013 - 14 115 127 135 139 146 2014 104 114 120 130

2014 - 15 117 129 137 142 149 2015 106 116 122 133

2015- 16 119 131 140 145 152 2016 107 118 124 135

2016 - 17 122 135 143 148 156 2017 110 121 127 138

2017 - 18 124 137 146 151 159 2018 112 123 129 141

2018 - 19 129 142 151 156 164 2019 115 127 133 145

2019-2020 131 144 154 159 167 2020 117 129 136 148

2020-2021 134 148 157 163 171 2021 120 132 139 151

2021-2022 137 151 161 166 175 2022 122 135 141 154

2022-2023 139 154 164 169 178 2023 124 137 144 157

2023-2024 141 156 166 172 181 2024 126 139 146 159

2024-2025 144 159 170 176 185 2025 128 142 149 162

Shelby EnergyPeak Day Weather Scenarios

49

Figure 1-10

Shelby Energy - Normal Peaks And T&D Planning Peaks

0

50

100

150

200

250

1990 1993 1996 1999 2002 2005 2008 2011 2014 2017 2020 2023

Pea

k M

W

Actual Winter Normal Winter 10% Case - Winter Actual Summer Normal Summer 10% Case - Summer

50

RUS Form 341

51

Form 341Form 341

shelby energy cooperative, inc. 2006 load forecast prepared by: east kentucky power cooperative,...

Documents

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load forecast report

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