Thoughts to Ponder….

1. Thoughts to Ponder….

2. A Steel Pole Perspective by George Tamez, PE

3. Why Steel?

4. Evaluation • Strength • Environmental • Customer Acceptance • Inventory & Handling • Lineman Concerns

5. Steel D Wood Intangible Decision is Steel Inventory & Handling Linemen Concerns Customer Acceptance Environmental Strength

6. So What is the Problem?

7. NPV: Time & Money • New Installation • Replacement Accessible

8. 10 20 30 35 45 55 65 70 $ 1537 Steel – New Installation WACC= 7% Inflation= 2% 112 3000 1500 29 24 20 10 15 12 NPV s =

9. 10 20 30 35 45 55 65 70 $ 1235 Wood – New Installation WACC= 7% Inflation= 2% 1060 2100 950 530 70 58 48 25 30 36 NPV w =

10. 10 20 30 35 45 55 65 70 $ 2137 Steel – Replacement Accessible WACC= 7% Inflation= 2% 112 3000 2100 29 24 20 10 15 12 NPV s-r =

11. 10 20 30 35 45 55 65 70 $ 1335 Wood – Replacement Accessible WACC= 7% Inflation= 2% 1060 2100 1050 530 70 58 48 25 30 36 NPV w-r =

12. Tangible Decision is Wood • New Installation • (NPV s) > (NPV w) by ~ $ 300 • Replacement Accessible • (NPV s-r) > (NPV w-r) by ~ $ 800

13. 1,566 sq miles • 7,450 OH ckt miles • 360,000 poles

14. Net Yearly InstallationsWood vs. Steel Wood decreases by avg. of 27% Steel increases by avg. of 46%

15. What goes up must come down!

16. Breakdown of Wood Installations

17. System Improvements Contributing to Increase Use of Steel

18. Could We Go Cold Turkey?

19. Customer Commitments

20. Agreements to Use Steel • San Antonio Capital Civic Improvements • Suburban Cities * Universal City * City of Live Oak * City of Schertz • Military Bases * Camp Bullis/Fort Sam Houston * Brooks • Conversion/Beautification Projects

21. Where do we go from here?

22. Recommendation are… • Discontinue use of steel on system improvements, • Continue use steel for City of SA Civics/Political, • Continue use steel for reimbursable customer requests,

23. … but depends on budget, price of steel.

24. “ Tis easy to See, hard to Forsee.” ~~Benjamin Franklin.