OPPD has worked and continues to work to be good financial stewards for customer-owners. Some of our lean business practices include the following areas:
Staffing: OPPD has deferred hiring in staff in a number of areas. In addition, when roles become vacant OPPD reviews the role to determine necessity. Other options include shifting staff responsibilities where possible to cover for the open position. In addition, OPPD has used outside contractors for some short-term projects instead of hiring additional staff. When planning for outages at the baseload generating stations, OPPD has minimized overtime where possible and used outside contractors instead of hiring permanent staff.
Training: Due to COVID-19, OPPD cut expenses by using online platforms for most training/conferences, which cut some travel expenses. OPPD also used this opportunity to review some training/conferences and in some cases, switched to more cost-efficient methods via these online platforms. We also reduced planned employee development training, where possible. There is also some non-training travel that has been reduced by the use of virtual meetings.
Administrative/other: OPPD has reduced furniture purchases, and some planned brand marketing expenses. OPPD has also used advances in Supply Chain Management to find the most economical option for most purchases. With remote work, OPPD has also cut material and supply costs. We are coordinating technology upgrades to ensure the most effective use of our budget. We are also reviewing all of our software to try and eliminate any duplication of capabilities. And, we have narrowed the scope on a number of projects across the company to achieve cost-savings wherever possible without sacrificing electric service reliability or safety.
Bond refunding: OPPD’s finance team continues to achieve savings through bond and commercial paper refunding. Our bond refunding issue for 2021 resulted in a net present value savings of approximately $7.8 million. In addition, the utility anticipates a net present value savings of $41 million after refunding subordinate debt with commercial paper in 2019 and 2020. Since commercial paper has varying interest rates, the exact savings will not be known until it is realized. Bond refunding achieved $16.9 million in net present value savings in 2019 and $15.1 million in 2018.