Loading...
HomeMy WebLinkAboutNatural Resources Advisory Board - Minutes - 03/18/2009NATURAL RESOURCES ADVISORY BOARD MINUTES Regular Meeting March 18, 2009 DATE: Wednesday, March 18, 2009 LOCATION: 215 N. Mason - Conference Room 1-A TIME: 6:OOpm For Reference: Alan Apt, NRAB Chair 221-9875 Ben Manvel, Council Liaison 217-1932 John Armstrong, Staff Liaison 416-2230 Board Members Present: Ethan Billingsly, Heather Manier, Joe Piesman, Liz Pruessner, Alan Apt, Phil Friedman, Clint Skutchan, Glen Colton Board Members Absent: none Staff Present: Natural Resources Department: Alexis Hmielak, John Armstrong Call meeting to order - Alan Apt called the meeting to order at 6:07 Introduction of Guests — Vicky Troxler who is an applicant for the NRAB, CSU students Susan Bain and John Andrews who were present as part of a class assignment. Agenda Review — none Public Comments: none Review and Approval of Minutes: January 21, 2009 Liz Pruessner moved and Phil Friedman seconded a motion to approve the January 21, 2009 minutes of the Natural Resources Advisory Board as presented. Motion passed unanimously Net metering / Electric Service Code changes As Steve Catanach was out of town, the NRAB talked to Steve by conference call.. - • Alan Apt summarized that the NRAB has been asked to consider endorsement of the electric service code changes and the Electric Board's comments and recommendations on that code. The call tonight to Steve was to discuss that request and any questions the NRAB may have about the issue. • Steve reported he had a discussion with the Electric Board after his previous visit to the NRAB. Results of that discussion were: o The issue of insurance and liability requirements should belong in the interconnection agreement and vary with the type of electricity generated. o If a third party is coming in to sell electricity retail and the system would need to be upgraded to accommodate them, they,would pay for the upgrade and impact to the system. o Steve pointed out the electric system is designed for delivery, not reception of energy. If too many homeowners put up too many solar arrays that would overload the 'transformer, the Electric Board suggested Utilities would cover those costs. • Phil Friedman asked if commercial accounts also put up too many/large arrays that eventually overloaded the system would the last business be billed. Steve stated commercial ` utility use is "shared resources". There are up -front development fees to cover these contingencies and this scenario would be treated as a normal upgrade. Using a shopping center as an example, Steve pointed out there is a service entrance sized for the load of all the customers and would have to be upgraded if the communal electricity need is increased. • Liz Pruessner asked if the proposed changes do enough to incentivize and promote residential solar installation. Steve stated no, but buying back electricity at retail cost and allowing 3`d party developers is as far as they can go. They would need to look at other avenues to provide incentives. He is hopeful that through the stimulus package they are going to receive additional help from Governor's Energy Office because he heard they want to disseminate funds through the local utilities. • Liz also asked if the code change discourages outside sources from making solar options more affordable for residential customers in Fort Collins. Steve answered not at all. In his opinion, Fort Collins is being leading edge and flexible for allowing for 3`d parties to sell to customers retail. Utilities originally established the 3`d party limits because PRPA didn't want to be involved with generation of up to 1 Okw for residential and up to 1 MW for commercial. o Steve Catanach stated a Colorado Senate bill (SB51) is being considered that will mandate a similar structure to regulated utilities like Xcel. o Phil asked what would happen if a homeowner or business put on a system outside of the approved parameters, would they then jump to the other category. Steve was certain the definitions of commercial and residential are spelled out in the code, but he will check. Phil suggested researching Excel Energy's breakpoints and be sure to have all scenarios codified up front so there are no grey areas for any customer. • Alan Apt suggested Utilities also look at generation from home owners associations. Steve suggested the meters should be in -the common areas so credits go to the group. • Regarding incentivizing installation of solar on homes, Joe Piesman was concerned people would hold off installing it until stimulus money could be made available. Steve stated the City currently has an incentive program paid for through matching grants from the Governor's Energy Office (GEO). Even though it hasn't been enough, the City has been discussing with the GEO that it is worth Utility's money to continue to provide those incentives. In order to meet Fort Collins renewable portfolio standard of 11 % in 2011, the installation and purchase of those from local installation provides the greatest benefit for the money. Steve would like to see an increase in the incentive program above the $100,000 level. Joe suggested Utilities needs to better advertise this incentive program. • Clint Skutchan asked Steve to explain "payment in lieu of taxes on 3`d party retail sales". Steve explained Utilities pays the City 6% of all their sales in lieu of a franchise fee for use of right of way and it goes into the General Fund. Utilities is recommending a large incentive through net metering. This will cause a loss of sales, so payment in lieu of taxes will be reduced. The Electric Board recommends not to collect payment in lieu of taxes. This needs to be carefully evaluated to determine the impact on the City's General Fund. o Clint asked if fairness was discussed when the Electric Board made this incentivizing recommendation. Steve replied the focus has been on providing a strong incentive towards the development of these resources, not fairness. • Clint wanted to know exactly which recommendations Steve is asking the NRAB to support. Steve stated his report broke it out between net metering and code changes, and he was asking the NRAB to approve both of them, not necessarily the Electric Board recommendations. o Board recommendations regarding Net Metering: 0) ■ Customers should be reimbursed for their annual excess generation at their retail energy rate. ■ Net metering maximum established in the rate should be 1 MW. o Board recommendations regarding the proposed electric service Code change: ■ Remove language in Code requiring recovery of all costs, both direct and indirect, to the City and Platte River and instead address each potential cost specifically in the code. ■ Address specific concerns about insurance and infrastructure in the interconnection requirements. ■ Payment in lieu of taxes should not be imposed on third party retail sales. • In answer to a question by Glen Colton who was not sure the NRAB has a copy of all those changes to review, Steve pointed out nothing in the code change, other than increasing the 25kW limit to 1 MW, has changed since his presentation to the NRAB in December, 2008. Net metering is a rate, not an ordinance, so the recommendation is to approve the wording, "will purchase excess generation at the retail rate" that has been added to the rate codes. o Steve stated next steps are to take the recommendations to City Council, then a consultant will review the interconnection agreements in light of FortZED project to ensure we are covering the components of that adequately. He expects this to be a 2- 3 month process. • Glen asked Steve to address the concerns from Eric Sutherland about net metering. Steve stated, regarding the service code language, there is case law out there that supported statements that he previously forwarded to Council in an attorney/client memo. Steve stated Fort Collins is in compliance with HB 1160. Steve pointed out Fort Collins has had net metering for many years under special services 'portion of our rates. This effort is to codify it. • Alan asked about the buy/sell agreement. Steve stated Utilities has a sole source agreement with Platte River Power Authority. In order to honor their obligation to only buy energy from PRPA, net metering is a way to support renewable development while still honoring the intent of the contract with PRPA. PRPA will be at lesser risk to allow 3rd parties to generate up to 1 MW than it would otherwise. PRPA's bond council agreed. • Glen asked Steve if they would readdress net metering in three years because he just got solar panels and wants assurance net metering is going to continue past three years. Steve stated if Glen signs the interconnection agreement with Utilities, a portion of that is a non -ending contract for the reimbursement and is grandfathered in through the interconnection. Glen was also concerned there wasn't much rebate money and it is confusing to people who are interested installing PV systems in Fort Collins. Steve stated the 2010-2011 budget will have better funding. • Phil asked for clarification on 3`d party sales. Steve stated the 3`d party installs panels on rooftops and sells that electricity at a contracted retail price to the customer. Because of its contract with PRPA, the City cannot enter into an agreement with a 3Td party and if it were advantageous to do so, the City passes that contract along to PRPA, such as the Medicine Bow wind farm. • Phil also asked about insurance requirements. Steve stated residential insurance would be like a standard homeowner insurance rider to, ensure they bear a responsibility should a generator cause problems for a neighbor's building. The larger installations would be more likely to negatively affect the operation of an electric system because they are all tied together and Utilities wants to be sure they are insured against damage. • Phil suggested Steve investigate what Duke Energy in North Carolina did regarding switching out analog meters to digital ones that read kvar when a PV system is installed. • Alan summarized the NRAB needs to take action regarding the code and wondered if the group wanted to endorse anything the Electric Board recommended. He pointed out the 3 NRAB needs to determine agreed -upon specific language at this meeting; not by email at a later time. o Phil stated he would rather see the NRAB draft its own resolution that they support these items as they stand. Steve stated that would carry a stronger message to Council. He will take it to Council April 21. • Liz suggested, since the NRAB meets before Steve goes to City Council April 21., they could draft their recommendations tonight and then email it to all NRAB members for final tweaking and vote on it at their April 15, meeting. Alan agreed to write the draft. • Alan also wanted to discuss the Electric Board recommendations so he could incorporate them into the NRAB's recommendation. o Liz liked the suggestion to reevaluate net metering in three years or sooner. ■ Joe stated out things will most likely change a lot during that time, especially if plug-in hybrids become common. ■ Steve agreed and pointed out plug-in hybrids are also an energy storage device. Utilities wants to be flexible to deal with what the future is bringing US. o Clint was concerned about the inconsistency of the final item in Steve's memo that stated the City will cover the cost of residential upgrades, but commercial would pay for their upgrades" Steve stated should a commercial account install a generator that is larger than the capacity of the Utilities' system, they would be responsible for their costs which are far greater than residential upgrades. It is not meant to be a disincentive for commercial, but is reflective to the impact on the system. • Glen asked for clarification on 3`d party over 1 MW buy/sell agreement with PRPA. o Steve stated that with a generation of 1 MW there is a co -generation rate that addresses generation larger than 1 MW. The reason for that is that generation above 1 MW needs to be scheduled. If a customer is making more than 1 MW, PRPA needs to be sure there are adequate reserves to cover loss if they don't generate it. • Glen pointed out Xcel Energy has many large renewable energy projects planned. Steve stated Utilities is also trying to identify all opportunities and are trying to get contracts for large megawatt projects such as wind, FortZED and a thermal solar plant at Rawhide. • Glen is comfortable with the general recommendations of net metering by the Electric Board. • Alan stated, considering the City's financial situation, he did not like the suggestion of no payment in lieu of taxes. • Alan suggested, if plug-in technology becomes imminent, there should be an immediate reevaluation. He also feels having incentives available is important. • Liz suggested the City should pursue every avenue to incentivize at the commercial and residential level. • Phil felt the kvar issue needs to be addressed. • Alan does not want to dis-incentivize commercial customers. • In summary, Alan Apt and Phil Friedman will draft and circulate a motion and will put it on the agenda for the April 15, meeting for final vote. . Budgeting for Outcomes: NRAB role in 2010-2011 budget process • Staff Liaison, John Armstrong prefaced the discussion with a brief description of the Budgeting for Outcomes (BFO) process. o This is the third BFO cycle. o The purpose of the BFO process is to have a City budget that is more transparent, results -oriented and performance -based. a] • o This year, for the_first time, Chief Financial Officer Mike Freeman has asked the • boards and commissions to give input regarding the overarching results of the BFO' process. This is a new and specific outreach to the boards. o This is very early in the BFO process where the seven results areas are being evaluated as to whether they should be expanded, eliminated or changed in scope. No specific projects have been determined or monies assigned to them for purchases. o Interdepartmental teams of staff will be reviewing the seven result areas and statements to set the stage for the upcoming months of work. They will make offers to support these statements and rank them in importance. There is a set amount of money available and those projects that fall under the drilling platform will not be funded. o The Natural Resources Board has been asked to provide feedback on the Results Statement for the outcome(s) that most closely relate to their mission or work plan and summarize any recommended changes. o John presented a slide from the last BFO process showing the overarching results statement, the categories and sub categories under "Environmental Health". Discussion • The group agreed the purview of the NRAB overlaps many of the results statements, but Results Statement #2 is the most pertinent to their work plan. • After discussion, the group also agreed that Results Statement #2 (Environmental Health — Fort Collins creates, maintains and promotes a healthy and sustainable environment with an adequate, high quality water supply) should be amended, removing the specific reference to "high quality water supply" because the reference to water is misleading and limiting. o Clint pointed out the Results Statement #2 reference to "high quality water supply" does not address water conservation or the Poudre's value to the City. • Alan Apt suggested the NRAB should focus on the expense items for which they have made recommendations to Council • John Armstrong reminded the group that the subcategories under.Environmental Health are still being conceptualized and suggested they focus on making the overarching statement as concise as possible so it envelopes all of the concepts of Environmental Health. . • Glen suggested waste water treatment might better go under a safe community. • Regarding the budget itself, John Armstrong pointed out many environmental health programs are dedicated money and do not come from the general fund. However, there are programs in the program that fall under the purview of the NRAB. o Alan stated the City needs to get creative in reducing its overhead in the 5% of the budget that is not predetermined and suggested the City look at environmental investments such as solar to reduce its utility bill. • Clint stated he thought the seven key results are pretty indicative of what the City government should be doing. • Glen asked if the BFO only addresses General Fund money. John Armstrong stated some are dedicated money that can't be moved elsewhere. He stated in the last BFO cycle the building utilities were rolled into high performing government. • Joe Piesman stated the 3 divisions of Environmental Health - water, air and land seem to be somewhat artificially separated. John Armstrong clarified that the NRAB will have an opportunity to provide input on how the results maps are put together. • Alan stated that capital costs should be included in the utility budget. o John Armstrong pointed out the direction from the City Manager's Office is that the NRAB needs to confine its comments to environmental health even though there may E be an overlap to other results areas. He is not sure where all the utilities programs are listed and may be split. o Clint Skutchan stated building infrastructure needs in general are important and could be a stand alone results area. A state-of-the-art infrastructure is something to be focused on. He would like to see how dollars were allocated in the past. • John Armstrong stated he will work with the Environmental Health team to make sure the NRAB is kept up to date on the BFO process. NRAB elections (Chair and Vice -Chair) Alan Apt nominated Liz Pruessner for Chair of the Natural Resources Advisory Committee and 'would be agreeable to take the Vice Chair position because he will be travelling quite a bit in the future. Vote was unanimous Liz Pruessner was appointed Chair of the NRAB Liz Pruessner nominated Alan Apt for Vice Chair of the Natural Resources Advisory Committee. Vote was unanimous Alan Apt was appointed Vice Chair of the NRAB New Business • Joe Piesman stated that when there is a presentation to the NRAB it makes more sense to him to ask relevant, not tangential, questions during the context of the presentation and not hold questions until the end. He suggested that after the presentation, if any NRAB member wants to expand on their questions that would be the appropriate time. • Glen Colton suggested that when presenters are bringing previously presented items back to the NRAB that there be reference materials in their packets to remind them what they have already seen and any changes that have been made since then. • In answer to a question from Liz, Glen explained he suggested they have an NRAB work session to become more knowledgeable about the various types of alternative energy systems that are currently available and being planned. o Clint suggested there also be reference materials posted on the NRAB website that the group could refer to. Announcements none Council Six Month Planning Calendar • Clint would like an update on several items that had previously been presented to the NRAB such as the trash services regulatory changes and trash pilot project, the transportation plan, the second addendum to the Climate Action Plan, status of Glade Reservoir and Harmony I- 25 annexation o John Armstrong stated there will not be a pilot trash project until after the election. He also mentioned the water conservation plan is scheduled to come back to NRAB in April and they can review the Council work session on this. • Heather would like to see the City's Hazardous Materials Report. • Glen would like to hear about the Maxwell wind farm. C Liz Pruessner moved and Alan Apt seconded a motion to adjourn. The meeting was adjourned at 8:43 p.m. Submitted by Alexis Hmielak Administrative Secretary I J/ Approved by the Board on r'.(.�`� �5 200f Signed / o al Adrpimstrative Secretary I Date