Since 2000, BPA has lowered its weighted average interest rate on its outstanding Treasury debt from 6.6 percent to 5.0 percent through debt optimization, traditional refinancings and other debt management initiatives.

BPA's total debt and long-term obligations have been over $12 billion for more than 20 years. This total debt portfolio consists of appropriated debt assigned to BPA before 1974 that BPA has to repay; Treasury bonds that BPA currently issues to the U.S. Treasury under recently negotiated market terms and conditions; as well as non-Treasury municipal Energy Northwest debt backed by BPA, which originated before 1984.

The Debt Optimization Program has made room within the agency's limited $7.7 billion borrowing authority with the U.S. Treasury for new capital projects by extending maturing EN municipal debt and amortizing Treasury debt earlier than planned. As of Sept. 30, 2009, BPA has $2.13 billion outstanding in Treasury bonds. Absent other financing sources and BPA's initiatives to preserve capital, its Treasury borrowing authority could run out as early as 2018.

Repaying appropriated debt to Treasury does not create room in BPA's Treasury borrowing authority. Retiring outstanding Treasury bonds issued by BPA since it became self-financed in 1974 creates room within the $7.7 billion borrowing limit.

Background Information