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HomeMy WebLinkAbout07/10/2025 - ENERGY BOARD - AGENDA - Regular Meeting ENERGY BOARD REGULAR MEETING July 10, 2025 – 5:30 pm 222 Laporte Ave – Colorado Room Zoom – See Link Below 1. [5:30] CALL MEETING TO ORDER 2. [5:30] PUBLIC COMMENT 3. [5:35] APPROVAL OF JUNE 12, 2025 MINUTES 4. [5:45] ORGANIC CONTRACT & POWER SUPPLY AGREEMENT (60 Min, Discussion) Travis Walker, Light & Power Director Yvette Lewis-Molock, Assistant Attorney II 5. [6:45] BREAK (10 Min.) 6. [6:55] GENERATION VS. CONSUMPTION GOALS (30 Min, Decision) Michael Authier, Energy Services Engineer III 7. [7:25] CITY COUNCIL 6-MONTH PLANNING CALENDAR REVIEW (15 Min.) 8. [7:40] FUTURE AGENDA REVIEW (5 Min.) 9. [7:45] BOARD MEMBER REPORTS Participation for this Energy Board Meeting will be in person at 222 Laporte Ave. Participation is also available online via Teams. Click or copy/paste this link into your browser: fcgov.com/energy-board-regular-meeting Online Public Participation: The meeting will be available to join beginning at 5:15 pm, July 10, 2025. Participants should try to sign in prior to the 5:15 pm meeting start time, if possible. For public comments, the Chair will ask participants to click the “Raise Hand” button to indicate you would like to speak at that time. Staff will moderate the Teams Meeting to ensure all participants have an opportunity to address the Board or Commission. To participate: • Please note: You do not need a Microsoft account or the Teams App to join or participate in the meeting. • Use a laptop, computer, or internet-enabled smartphone. (Using earphones with a microphone will greatly improve your audio). • You need to have access to the internet. • Keep yourself on muted status. ENERGY BOARD REGULAR MEETING 10. [7:50] ADJOURNMENT HOW TO JOIN A TEAMS MEETING WITHOUT A MICROSOFT ACCOUNT: You can join a Teams meeting anytime, from any device, whether or not you have a Teams account. If you don't have an account, follow these steps to join. 1. Select or copy/paste the following link: fcgov.com/energy-board-regular-meeting 2. That'll open a web page, where you'll see two choices: “Continue on this browser” and “Join on the Teams app”. You do not need to install the Teams app to join the meeting. 3. If you join the meeting on your browser, Microsoft Edge or Google Chrome will both work. Your browser may ask if it's okay for Teams to use your mic and camera. When you select Allow, you should always turn off your mic and/or video once you join the meeting. 4. When you're ready, select Join now. 5. Tip: Join the meeting up to 15 minutes before the meeting start time to test your setup, troubleshoot, or see how Teams works. Meeting organizers and participants won't be notified that you've joined the meeting until 15 minutes before the scheduled start time. ENERGY BOARD June 12, 2025 – 5:30 pm 222 Laporte Ave – Colorado Room ROLL CALL Board Members Present: Jason Hevelone, Natalie Montecino, Frederick Wegert, Wendell Stainsby, Brian Smith (remote), Jeremy Giovando, Marge Moore (remote), Aleksander Thorstensen Board Members Absent: Scott Canonico, Jeremy Giovando OTHERS PRESENT Staff Members Present: Christie Fredrickson, Michael Authier, Brad Smith, Neal May, Randy Reuscher, Travis Walker, Yvette Lewis-Molk (remote), Cody Snowdon (remote) Members of the Public: Rick Coen MEETING CALLED TO ORDER Chairperson Smith called the meeting to order at 5:30 pm. ANNOUNCEMENTS & AGENDA CHANGES None. PUBLIC COMMENT Rick Coen is here to provide an update on the Riverside Community Solar Garden. The system is operating; Mr. Coen said it has been optimized and possibly running better than it ever has. The owner’s group will be reviewing the City’s contract with the owners soon. The group is also considering starting an initiative for a second community solar garden. He implored the Board to consider how commercial rates affect the ability (or inability) for many customers to install solar at their homes or businesses. APPROVAL OF MINUTES In preparation for the meeting, board members submitted amendments via email for the May 8, 2025, minutes. The minutes were approved as amended. STAFF REPORTS Light & Power Operational Update Travis Walker, Light & Power Director Michael Authier, Energy Services Engineer III Mr. Walker is reviewing Light & Power’s QSAR, or Quarterly Service Area Report. The QSAR is used by service areas across the City to report out to City management on how they’re doing and what projects are being worked on. Mr. Walker reviewed Light & Power’s reliability statistics, CAIDI, SAIDI, SAIFI, and MAIFI. CAIDI (Customer Average Interruption Duration Index) measures if a customer experiences an outage, how long is that outage. L&P’s average is currently around 45 minutes. SAIDI (System Average Interruption Duration Index) measures the average outage length if every L&P customer lost power, which is currently 11 minutes. SAIFI (System Average Interruption Frequency Index) measures the frequency at which a ENERGY BOARD REGULAR MEETING customer experiences an outage. L&P’s is .26, which Mr. Walker explained can be understood as roughly a 45-minute outage every four years. MAIFI (Momentary Average Interruption Frequency Index) measures momentary outages. L&P rarely has momentary outages because the system is underground, shielding it from things that may cause short circuiting (tree limbs, animals, lightning strikes). Board member Stainsby asked what the primary causes of outages in Fort Collins are. Mr. Walker said the main causes are usually due to cable or accessory failures, typically because of an aged cable. Accessory failures can happen any time, but Mr. Walker noted that the Utility is seeing fewer of those failures as products get better and workmanship gets stronger. He added that the Utility’s Maintenance Crew uses infrared cameras to check for hotspots and potential failures, which can help us address those potential failures before they actually occur. Next, Mr. Walker reviewed what has been spent and allocated of the $40 million in bond money awarded in 2024. So far, about $16 has been spent, the bulk of which has gone toward transformer purchases. Mr. Walker said the Utility has a sense of what needs to be done, such as cable replacements, rear to front lot conversions, and additional transformers, but staff is continuing to work the Capital Improvement Plan to refine the needs and allocations. The electric system capacity study will be kicking off soon, which provides an overall view of the system. This helps identify what the zoning for vacant lots are, as well as figure out where capacity will need to be built or see if substations need to be added. Finally, Mr. Walker briefly covered some of the vacancies and new hires within L&P as well as a short update on the Maximo project (asset management software). Mr. Authier updated the Board on the recent Council work session for Council’s Priority 6, “reduce climate pollution and air pollution through best practices, emphasizing electrification,” which the Board heard about last month. Mr. Authier said Council had several questions and clarifications but seemed generally supportive of the work being done so far. He noted that Council reiterated the importance of the City leading by example. Mr. Authier mentioned that the EcoFest event is this Saturday from 10-1 in Washington Park. There will be food trucks, live music, and info booths; he encouraged board members to stop by if they are free. INTERCONNECTION STANDARDS UPDATE Neal May, Electrical Engineer IV Mr. May will be briefing the Board on meter socket adapters (MSAs, also known as meter collar adapters), usage in Light & Power metering applications. MSAs allow for a line side connection ahead of a customer’s main disconnect or breaker in the electrical panel. The National Electric Code (NEC) NEC code requires, especially when a new solar system or battery pack is added to it, that there is room on the panel and that it has a breaker dedicated to that circuit. MSAs allow customers to make that connection ahead of their panel. Electric Capacity Fees (ECFs) are assessed based on the size of the building’s main panel disconnect, so avoiding service upgrades saves the owner money. When MSAs first came to Fort Collins, the engineers on staff at the time took several things into consideration, including the potential to damage customers’ sockets, clearance issues, and safety of ENERGY BOARD REGULAR MEETING utilities staff. In an effort to improve safety for field crews who work on meters, as well as the overall customer experience, Utility’s staff added meter socket bypass requirements. Typically, when field crews are working on the meter or meter socket, they remove the meter entirely. With an MSA installed, the customer could still be under load, so when the equipment is removed there is potential for an arc flash. Installing a bypass reroutes the power to the meter socket so the meter is no longer getting power and can be safely removed. The customer does not lose power and field crews can work safely. In 2022, the Utility began allowing MSAs in the ring type meter sockets (as opposed to ringless), because of the type of bypass compatible with that style is the safest for the Utility’s operations should the meter need removed. Mr. May explained that roughly a year ago, Tesla approached staff, seeking approval to install ringless MSAs. The Utility had a fresh set of engineers, and they began a new evaluation which brought up some new questions. The engineering review raised some concerns, such as graying the line between customer owned equipment and utilities equipment. If utility crews are not trained on or equipped to remove or replace MSAs, who is liable if something becomes damaged? Thes MSAs are also a risk as an additional point of failure, and if it were to malfunction and causes loss of power, the customer may contact the Utility. At this time, Fort Collins Utilities is the only publicly owned utility who allows MSAs, and since we are a smaller Utility (compared to larger corporations such as Xcel, PG&E, etc.), and do not have the same benefit of scale to take on ownership and maintenance. For a long time, MSAs were used to add solar to a property (generating onto the system), but now with the addition of batteries, they can be used to charge off the system. This could pose a risk to upstream equipment, as well as potential loss of future ECFs. Because of these risks, and others identified during the engineering review, staff had initially proposed not allowing any MSAs to be installed in the future. However, after meeting with several stakeholders, including representatives from COSSA (Colorado Solar and Storage Association), manufactures, and local electricians and installers, the Utility has issued a stay on the policy change and maintain the current standard (ring-type adapters will be permitted). Board member Montecino asked how many direct customer requests the Utility has received to install MSAs and if there is a threshold in which the Utility would consider asset ownership or additional training. Mr. May said he’s not sure of an exact number, but he estimates there are less than 200 MSAs in total (so far). Mr. Walker added that there are plans to provide additional training (in partnership with the manufacturer) for the field crews since the policy is not going to change, but it is yet to be determined if the City would ever want to own them, so it's hard to say what that threshold would be. Board member Stainsby asked if staff had moved ahead with their initial plans and changed the MSA allowance, what the cost would be like for the end-user. Mr. May rewiring costs would range from $1000- 2000.00 depending on the installer and the work needed; however, the cost could be significantly more if a service upgrade is needed. COMMERCIAL RATES OVERVIEW Michael Authier, Energy Services Engineer III Randy Reuscher, Lead Analyst, Utility Rates There are two different revenue sources for the Utility: monthly rates, which are collected through utility ENERGY BOARD REGULAR MEETING bills, and one-time fees, which are collected through development fees (related to new or redevelopment). There are three components to monthly rates: recover costs to operate the distribution system in order to provide service, recoup expenses for ongoing maintenance and renewal of the distribution system and collect for any associated wholesale costs. One-time development charges recover capacity costs to buy in to the existing system, collect for site-specific costs, and provide funding for future growth-related capital investments. Of Light & Power’s 2025 total budget (roughly $173.5 million), 35% is allocated to electric distribution and the remaining 65% is paid to Platte River Power Authority for wholesale costs. Platte River has announced their rate increases for 2026, so as staff begins the planning process there are a few components they will consider: long-term financial planning (10-year horizon), a cost-of-service study (updated every two years), and electric rate design. Long-term planning factors in the Utility’s Capital Improvement Plan (CIP), as well as labor costs and inflationary costs, which will be built into revenue and expense modelling and help determine revenue requirements, or how to best sustain the utility and its operations. Once that's determined, it sets the bar for what goes into the cost-of-service models (allocations amongst the customer classes). Things that influence those allocations include metering costs, energy and demand consumption for the different classes, and load factor (the mix between energy and demand). The final piece of the puzzle is the electric rate design. Through the cost-of-service study, staff can identify how to recoup all charges to be revenue neutral. Mr. Reuscher noted there are several different ways to design the rates (time of day rates, flat rates, tiered rates, etc.). Different classes have different combinations of rate design components, but the goal is to end revenue neutral. Even when time of day rates were implemented in 2018, the goal was not to make more money but rather influence customers to shift their usage away from the peak window to reduce stress on the grid. Rate components include charges and credits. The charge components are fixed (flat cost related to service), energy (consumption), demand (highest rate of consumption), and coincident peak (rate of consumption during highest combined demand). The charge credit is energy, or customer generation (solar) purchased by Utilities. There are some unique parts of those components staff wants to call attention to. Mr. Authier explained demand ratchet is essentially a minimum rate based on the previous eleven months. If the customer’s demand drops below that minimum, then they would pay the ratchet, or the minimum, instead of the actual usage. The reason this is in place is because some customers have peaking usage at certain times of the year and use significantly less the rest of the year. The ratchet levels the revenue over all 12 months. Coincident peak is the highest point of energy consumption on an electrical grid that occurs at the same time across the Utility's service area. Mr. Authier noted the Utility’s coincident peak is weather driven and almost exclusively happens on weekdays. For larger commercial customers, coincident peak charges typically account for 23% of their electric bill. The Utility does offer support, such as the peak load page, where these customers can access and see where we're heading. There are also additional resources on how to reduce consumption, etc., if peak load is expected. There are different rate classes depending on what type of customer is using electricity. Residential rates include standard time of day, and electric time of day (for those customers who are all electric). General service encompasses small, mid-size, and large commercial customers, as well as industrial. In the past, ENERGY BOARD REGULAR MEETING Board members were curious about how the Utility decides who is in which rate class, so Mr. Authier explained that staff evaluates the customer’s previous 12 months of demands and identify an average, which is what determines the assigned class. In instances where a customer adds a lot of load they may move up a class; however, moving up or down a class does not necessarily mean you are paying more or less, because it is dependent on the usage and load factor (among other rate component influences). 2024 IECC CODE MEMO Mr. Smith briefly reviewed the timeline for the IECC code adoption. The Board discussed when they might be best utilized to take an action, ultimately deciding they would prefer to wait to hear the final version of codes before they go before City Council. This will also leave an opportunity for additional Board members to be apart of the discussion, as there are several missing from tonight’s meeting. Mr. Smith said he will come back for the Board’s August 14th meeting, which should align well with staff’s anticipated Council timeline. BOARD MEMBER REPORTS None. FUTURE AGENDA REVIEW The Board’s June work session will cover generation vs. consumption goals. Their July 10 meeting will spend additional time discussing generation and consumption, with Board consideration of drafting a memo. They will also hear a presentation regarding the update to the Organic Contract and Power Supply Agreement with Platte River. ADJOURNMENT The Energy Board adjourned at 7:37 pm. Headline Copy Goes Here Assistant Attorney II Yvette Lewis-Molock Light & Power Director Travis Walker 7/10/2025 Organic Contract and Power Supply Agreement Update and Timeline Headline Copy Goes Here 2 Energy Board Agenda 1.What is the Organic Contract and Power Supply Agreement? 2.Why update this now? 3.What are the goals for the update? 4.What are next steps? https://www.focosustainability.org/uncategorized/fort-collins-sustainability-group-large-methane-user-fee-proposal/ Purpose Statement: Staff will provide relevant information and gain common understanding associated with Organic Contract and Power Supply Agreement update. Headline Copy Goes Here 3 Organic Contract & Power Supply Agreement Relationship Headline Copy Goes Here 4 What is the Organic Contract? Four-way agreement among Platte River’s member owner cities Serves as Platte River’s “constitution” — establishes the governance structure Colorado law empowers governmental units to contract with each other to jointly provide any function, service, or facility (C.R.S. §§ 29-1-203) including a governmental power authority (C.R.S. §§, 29-1-204)) Grants Platte River enumerated powers, including bonding authority, similar to a power authority under state statute With proper authorization, Platte River may also provide additional services for its owner communities The current agreement runs through December 31, 2060 Headline Copy Goes Here 5 What is the Power Supply Agreement? Separate bilateral agreements between Platte River and each owner community Terms are essentially identical across all agreements Reflects each owner community’s mutual commitment to follow shared rules Secures all revenue bonds issued by Platte River Revenues from energy purchases by owner communities Fund Platte River’s operations, capital investments, and debt service Headline Copy Goes Here 6 Why the update to the agreements? Board policy goal: •Platte River aims to reach a 100% noncarbon energy mix by 2030, while keeping power reliable, affordable, and environmentally responsible Major system changes: •We’re in the middle of fundamentally transforming how power is generated and delivered to owner communities Modernize contract language: •Current agreements contain outdated language; this is a chance to update them, so they stay relevant and durable for the coming decades Bond market confidence: •A long-term extension sends a positive signal to financial markets o This will help support new bond issuances starting as early as 2026 Headline Copy Goes Here 7 Power Supply Agreement (PSA)– “All Requirements” What “All Requirements” Means: •Platte River supplies nearly all electricity to each owner community •Owner communities must purchase nearly all of their electricity exclusively from Platte River Three Key Exceptions: 1.Legacy generation o Pre-1974 generation resources owned by the community 2.New small-scale generation o Up to 1 MW or 1% of the owner community’s peak load (whichever is greater) 3.Net-metered energy o Includes residential rooftop solar, battery storage, and other customer-owned DERs Headline Copy Goes Here 8 Why “All Requirements” in PSA? Advantages •Economies of scale •Cost recovery •Equity among the owner communities •Stronger credit ratings •Bond covenant compliance •Certainty –resource decisions are for 30 years or more Risk Mitigation •Platte River brings resources and experience to manage risks •Lower risk to owner communities •Counterpart performance and credit risk Benefits •Owner communities and Platte River benefit from the most cost-effective and reliable solutions •Protect reliability and maximize operational flexibility •Lower wholesale power and transmission rates Headline Copy Goes Here 9 PSA: Modernizing Carve-Out Language to Support Shared Goals •Ongoing, shared efforts toward a reliable, affordable, and rapidly decarbonized energy portfolio Replace detailed carve-out terms with a broad commitment to: •Current clean energy goals •A more collaborative and adaptive approach Update recitals to reflect: •Use flexible, enabling language that supports innovation and adaptation Shift away from prescriptive meeting requirements around distributed generation •Should not determine how a resource is treated in terms of carve-outs or eligibility Clarify that interconnection point (high voltage vs. distribution) Headline Copy Goes Here 10 PSA: Contract Term and Market Compatibility Updates •Support long-term planning and stability Extend Agreement Terms •Align with current law; increase flexibility for solar Modernize Net Metering Language •Ensure compatibility with organized market rules •Enable transmission cost recovery via formula rates Update Rate Provisions •Support efficient participation in organized markets Revise Market & Surplus Sales Terms Headline Copy Goes Here Dec 12, 2024 Jan –Feb 2025 March 2025 April 2025 May- June 2025 July 2025 Aug 2025 Mid-Sept 2025 Sept 25th October 2025 11 Timeline and Next Steps Kickoff discussion with Platte River Board Present key concepts to Platte River Board Owner community outreach Present initial redlined drafts to owner communities Gather feedback and refine proposed amendments Final check-in with owner community attorneys Board council Review Platte River Board Confirmation “Pens down” – circulate final documents for approval processes City councils and town board approve Organic Contract & PSA amendments Platte River board approves PSA amendments All parties sign Headline Copy Goes Here