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HomeMy WebLinkAboutElectric Board - Minutes - 11/19/2008Fort Collins Utilities Electric Board Minutes Wednesday, November 19, 2008 Electric Board Chairperson City Council Liaison John Morris, 377-8221 Wade Troxell, 219-8940 Electric Board Vice Chairperson Staff Liaison Dan Bihn, 218-1962 Robin Pierce, 221-6702 Roll Call Board Present Chairperson John Morris, Board Members Tom Bamish, Steve Wolley, John Graham, John Harris and Jeff Lebesch Board Absent Vice Chairperson Dan Bihn Staff Present Brian Janonis, Steve Catanach, Tom Rock, Kraig Bader, John Phelan, Patty Bigner, Bob Hover, Lucinda Smith, Eric Dahlgren, Terry Bryant, Jenny Lopez-Filkins, Bill Switzer, Ellen Switzer, Robin Pierce and Meagan Peil Guests Stephen Yurash, Joe Wilson and John Bleem Meeting Convened Chairperson Morris called the meeting to order at 5:30 p.m. Public Comment No public comment. Approval of October 15, 2008, Minutes Board Member Barnish motioned to approve the minutes from the October 15, 2008, meeting. Board Member Graham seconded the motion, and it passed unanimously. Climate Action Plan Senior Environmental Planner Lucinda Smith provided an update on the Climate Action Plan work session on October 28, 2008. Council has asked staff to prepare an alternate plan which would fully meet the 2012 and 2020 objectives. Staff created an addendum to the Climate Action Plan to be presented to Council on December 2, 2008 and, if adopted, it will be merged with the Climate Action Plan to create the Fort Collins Climate Action Plan. Lucinda Smith would like a recommendation from the Electric Board regarding the proposed addendum. The proposed addendum addresses the issues Council wanted to see implemented to meet the 2012 and 2020 reduction objectives. In order to meet the objectives, it is likely Fort Collins will need to acquire certified carbon offsets. However, this strategy should only be implemented after emissions reduction, energy efficiency and transportation programs are maximized to their fullest. Another strategy in the proposal is the construction and demolition waste debris deposit system. This strategy entails creating a refundable deposit system for construction debris requiring a certain percentage of the construction waste be recycled to an appropriate level before the deposit would be refunded. The transportation strategy needs to be a community -wide goal to reduce emissions throughout Fort Collins. The goal of this strategy is reduce the VMT (vehicle miles traveled) to six percent total and is estimated to reduce approximately 27,000 tons of emissions by 2020. The Community Climate Challenge strategy had an original goal of a one percent reduction per person. Council would like to increase this to two percent per person to achieve the overall goal of a 20 percent reduction by 2020. The last strategy discussed was the increased participation in the Colorado Carbon Fund which would increase from the 5,000 proposed in the Climate Action Plan to 12,000 in the addendum. Additional items for discussion were exploring increasing efficiency in existing buildings, investigating other ideas throughout country, diversion of waste from landfills, looking into non -combustion type processes, anaerobic digestion, and new strategies elsewhere. Another additional item is promoting Fort Collins as a green community, and this was recommended by the Economic Advisory Board. Discussion: What is the estimated number of staff needed to implement the addendum? There will be no additional staff needed to implement the addendum. What is the likelihood of using the Colorado Carbon Fund for these projects, and what kind of projects do they fund? Projects range from energy conservation to landfill update and capture. Are we as a community too small to invest in these locally? The benefit of working through the Colorado Carbon Fund and the Governor's Energy Office is having the resources to create and implement programs and to get the certifications. The Colorado Carbon Fund is quick revenue, because they only fund projects in the state. Also, we could possibly submit Fort ZED as carbon fund, and we can also invest Northern Colorado Community Foundation. Has the City considered making available all of its open space for consideration for placing renewable projects? Some of the open space properties are candidates for the renewable projects. However, there are issues with the possible eco-system impact. The Natural Resources Department has hired an intern to assess the potential impact and recommend open spaces for consideration. 2 Has there been any discussion of the negative impact of the promotion of Fort Collins as a "green community"? Promotion of the City of Fort Collins as a green community provides benefits of economic development. Promotion of the community is primarily done from outside sources, and it is understood about the carbon footprint left with the promotion of the community. Motion for recommendation of proposed addendum with an endorsement from the Electric Board. 5 for, 0 against, 1 abstention Abstention: Board Member Bamish Motion passed. Draft Energy Policy - Recommendation Letter A recommendation letter was drafted and will be sent to Council Liaison Troxell regarding the 2008 Energy Policy and our endorsement of the Policy. Motion to accept recommendation being sent to Council Liaison Troxell. 6 for, 0 against Motion passed. Net Metering Light and Power Operations Manager Steve Catanach would like direction and guidance - from the Electric Board regarding net metering parameters. The State Legislature House Bill 08-1160 requires the limit of the size of net metering generation with the recommendation of 10 kilowatt (kW) for residential and 25 kW for commercial customers. Compensation occurs at a retail rate as an offset for the energy generated, and credit can be applied and the excess energy is then purchased. The retail rate is the cost of the energy per year. The systems would require separate metering, and the program funding is through subsidies and grants. However, if every house offsets usage, Utilities would lose money, so there is a built-in cost for infrastructure. The fixed cost would be paid to Utilities regardless of generation. There will be a Council work session regarding net metering on January 13, 2009 and will be proposed to Council for approval on February 3, 2009. Discussion: At what level do we have the retail rate? Platte River Power Authority (PRPA) has a retail rate, and the customer would pay for generation. What if there was an "energy park" with a homeowner's association? There would have to be parameters set if this were to happen with the possibility of a contractual agreement with regard to generation and rate issues. The overall goal is to set the net metering limits for residential and commercial including operating parameters and purchasing of energy generated. Mr. Catanach will be returning in December with scenarios and will be requesting a recommendation from the Electric Board on the net metering parameters. Code Change The language in the existing City Code pertaining to electric service needs to be updated in regard to the transmission facilities and generation of electricity by a third party. Chapter 26 of the City Code requires anyone providing electricity within the City of Fort Collins to have a license to franchise and sell electricity. The goal of the Code change is to ensure the City of Fort Collins Utilities is the only service provider in the Fort Collins service area of and to determine parameters for net metering with renewable technologies. The proposed Code change is to the Service Area section of the Code. The approach to the change bore three goals in mind. The first goal was to establish more clearly defined service area protection. There are currently two customers who can be identified, one of them an extremely large industrial customer potentially served by a neighboring utility. This is because our current Code language only requires another entity to obtain a franchise agreement if they are crossing City Right -Of -Way (ROW). The second customer could be served by another entity without crossing ROW. The second goal was to write the ordinance to provide service territory protection, just like every other electric utility is given under the law, yet providing flexibility in the Code to support the development of renewables within the service territory including those selling electricity to our customers under a retail agreement. The third goal in the ordinance was to write it such that the support of renewable developed third party retail sales did not jeopardize PRPA's bond rating. Above the 10 kW residential and 25 kW commercial thresholds, PRPA will enter into a buy -sell agreement with the third party generator. This is basically establishing a wholesale purchase agreement between PRPA and the generator, and the City will then reach an agreement with the customer to pass the wholesale cost through. The discussion with the Electric Board will continue on December 17, 2008 on how best to handle sales taxes and Payments in Lieu of Taxes (PILOTS). Citizen Comment: With the economic times as they are right now, Steve Yurash could see a large company putting a large photovoltaic (PV) unit, and then a year later file for bankruptcy with the large PV unit not generating or no consumption. He would also like to hear more discussion regarding splitting the difference on the buy/sell agreement with PRPA and retail rate in regard to wholesale and retail rates. Mr. Yurash feels he rate should be in absolute dollars because it would not fluctuate with time as costs increase. Mr. Catanach will return in December with a finalized proposal to take to Council for approval on the change to Code language. Energy Board Utilities Executive Director Brian Janonis attended the last Council work session on October 28, 2008, and Councilmember Kelly Ohlson recommended to City Manager Darin Atteberry the City of Fort Collins replace the Electric Board with an Energy Board. The intent is to broaden the look at the overall energy policies with reviews of transportation policies and coordination of planning throughout the City. Councilmember Ohlson has concerns about the overall structure of the Electric Board and the structure of Utilities as a whole. The intent is to have a Board to oversee all the processes and be all encompassing. M Discussion: Board Member Graham expressed concern an Energy Board would have to meet two to three times more frequently than the Electric Board meets now in order to address this broader scope, and the Electric Board work plan for 2009 is already full with items for review. By changing context and purpose of the Electric Board and replacing it with an Energy Board, it would create almost a full time position that would take up all of the members' time; however, having the Energy Board would allow stronger mandates than before, code changes, proposals and reviews. The creation of an Energy Board would bring in more than just transportation, but would also include housing, neighborhood services, climate plans and all of the boards, creating a single large board which perhaps should be more of a task force. Council should take value in the importance of the Electric Board and the value of the professionals on the Board that work the staff and Council. Mr. Janonis will keep the Board abreast of the situation regarding the change of the Electric Board to an Energy Board. 2009 Work Plan Final Review The 2009 Electric Board work plan was submitted to City Council prior to the November 30, 2008 deadline and the Electric Board will discuss the work plan schedule at the December 2008 meeting. Committee Updates PRPA- Dan Bihn: No report. Climate Task Force- Jeff Lebesch: No Report. Energy Supply Sub -Committee Update- Dan Bihn & Jeff Lebesch: No Report. Capital News- Steve Wolley: No Report. Other Business None Future Agenda Items Mr. Catanach - Net Metering and Code Change (action items). 2009 Work Plan Schedule Adjournment The meeting was adjourned at 7:52 p.m. following a motion to adjourn by Board Member Graham. Submitted by Meagan Pei], Secretary Fort Collins Utilities Approved by the Board on Z�z'2008 S' ed Meagan Pell ate