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HomeMy WebLinkAbout2011 - Electric Board - Annual ReportFort Collins Electric Board 2011 Annual Report Electric Board Members Steve Wolley – Chair Ed DeCourcey – Vice Chair Tom Barnish John Graham John Harris Peggy Plate Steve Yurash The Electric Board for 2011 consists of seven members chosen by City Council. The role of the Board is to: 1. Advise the City Council on policy matters pertaining to the municipal electric system. 2. Act as the final appeal and hearing body for customer complaints except as is otherwise provided in Chapter 26, Article XII regarding termination of utility service 3. Act as a sounding board for the purpose of identifying the ratepayers’ service delivery expectations 4. Perform such other duties and function and have such other powers? As may be provided by ordinance of the City Council. The following is a summary of Electric Board actions and activities for 2011 Actions  Building Code “Green Amendments” The Green Building Code Project Manager and the Energy Services Manager presented the amendments to the Green Building Code. The presentation highlighted refinements made since the last presentation in December 2010 including use of Low VOC (Volatile Organic Compounds), lighting, materials and provisions for electric heat. They also provided a comprehensive benefit to cost analysis. Discussion and questions followed the presentation. A motion was made that the Electric Board recommends the proposed building code green amendments for residential and commercial construction to be integrated into the City’s existing building codes. This was passed 5 to 1. Reason for nay vote: A board Member voted against the motion out of concern that it will cost the community too much. 2011 Electric Board 2  Rate Design Philosophy and Principles Consultant, SAIC and Staff presented information concerning philosophy and principles for future rate design. The strategy is to “: take a long-term view as rates are designed and implemented that will prevent short-term decisions that conflict with long-term goals. Rate design must reflect existing strategic direction, vision, and values of the City. The Board considered the Triple Bottom Line and the impact on all stakeholders, After a lengthy discussion, The Electric Board recommended that the City Council consider approval of the proposed Financial Strategy and Rate Design Philosophy, consistent with staff’s recommendation. The motion passed unanimously.  Appropriations Request for Relocation of Utilities in Mason Corridor Staff presented to support the proposed ordinance to fund Light and Power facilities relocation for the Mason Corridor Project. The ordinance transfers $400,000 of the existing budget into BRT (Bus Rapid Transit)/Mason Corridor Project. There will be a fifty percent reimbursement from Federal funds. Following discussion, the Electric Board moved to recommend that the City Council approve the proposed appropriation ordinance to fund electric additions and relocations in the BRT/Mason Corridor. The motion passed unanimously.  Minor Amendments to the Electric Article of the City Code and Interconnection Standards Staff provided the proposed minor changes to the Electric Article in the City Code. These were primarily definitional in nature. They included personnel title changes and clarification to the net metering definitions, qualifications for net metering, historic information, and the risk of not having these changes in place. As a result of the discussion a motion was made that the Electric Board recommend that the City Council adopt by ordinance the proposed Minor Amendments to the Electric Article of the City Code and revisions to the Interconnection Standards. The motion passed unanimously.  Intergovernmental Agreement Between the City of Fort Collins, City of Longmont and Platte River Power Authority relating to the Operation of a Joint Information System Staff presented a new agreement between Fort Collins, Longmont and PRPA (Platte River Power Authority for PRPA to purchase and operate a joint customer information system on behalf of the two cities. The old agreement expired in 2008 and was extended for three years (this included a two year extension until Aug 2010 and a one year extension until Aug 2011. A thorough review of the information was made by the Electric Board. Following the discussion the Electric Board recommended adoption of the Intergovernmental Agreement between the cities of Fort Collins and Longmont and Platte River Power Authority for the operation of a customer information system required for the maintenance and billing of customer accounts. The motion passed unanimously. 2011 Electric Board 3  Electric Rate Options Staff and consultant R.W. Beck made presentations over the year concerning rate structure options for Fort Collins. The Electric Board reviewed the presentations and provided feedback to staff and the consultants. The Board was looking for consistency with the philosophy discussed earlier in the report as well as alignment with the Energy Policy and other city policies. The Board also commented on the potential impact to customers. Several options were presented, from only passing on the PRPA increase to implementing Time of Use (TOU) rates. The pros and cons for each option were analyzed and discussed. It is the belief of the Board that staff has a good understanding of options and impacts and the consultant has done a good job of researching and presenting the information. In summary the Board sent a memo to the city council alerting them that due to the complexity of the changes, they should allow plenty of time to hear all of the data before a decision is made.  Home Energy Reports Program Results Staff and an O-Power representative attended the Electric Board meeting to get support for continuing use O-Power for another year to support the program. Staff reported that approximately 25,000 customers receive individual information every two months. The results are: - Over 2,900 megawatt-hours (MWh) year to date have been saved - On track to exceed goal of 4,500 MWh - Cost of conserved energy less than $0.05 per kilowatt-hour (KWh). This amounts to about $400,000 returned to the community compared to the cost of $250,000 - Contributes approximately 20 percent of annual efficiency portfolio goal In 2012 enhancements include: - Refresh customer list to 27,500 households - Move all customers to bimonthly frequency - Implement varied stream module framework (aka dynamic report content)?? - Upgraded web portal with positive customer feedback - Home audit promotion in September Following considerable discussion, the Board moved that Chairperson Wolley draft a memo to City Council stating the Electric Board supports the program for the next year. The memo will be reviewed by each board member prior to distribution to Council. The motion passed unanimously. Subsequently a report was written and reviewed by Board members. The board sent a letter to City Council recommending continuation of the program for another year. 2011 Electric Board 4  Adoption of Light and Power Safety Manual Staff and representatives of the Light and Power Safety Committee presented an overview of the L&P Safety Manual. As part of submission to the American Public Power Association and to receive continued Reliable Public Power (RP3) designation, L&P must have an acceptable manual. The board moved that the board recognize the receipt of the manual and reviewed it as acceptable for submission to APPA. This will be acknowledged in a letter to staff. This passed unanimously.  Energy Policy Recommendation Staff made a presentation and asked the Electric Board to review the current Energy Policy. The four main points of the policy are: - Reliability (metrics; asset management; peak demand reduction) - Efficiency/Climate (carbon emission goals; efficiency and conservation priorities; renewable energy) - Economic Health (financial policies; rates, bills, and affordability; local economic benefits) - Collaboration with Platte River Power Authority (PRPA) Due to the age of the policy and goals that were put in place when it was adopted in 2009, the board moved that the Electric Board reviewed the Energy Policy and reaffirms its vision and the original goals. The Electric Board further recommends the future Energy Board broaden the scope of the policy to include other over-arching City goals. The motion passed 5 to 1. One member said that Goal #2 should be to reduce fossil fuel consumption, not focus on carbon emission reduction.  2011 L&P Budget Exceptions and Rate Recommendations Budget Exceptions The following changes were recommended to the original 2012 budget by staff: Purchase Power: $1,724,505 Payment in Lieu of Taxes (PILOTs): $121,969 Energy Efficiency Financing Program: $300,000 Following discussion with staff concerning the three items above a motion was made that the Electric Board recommend that City Council approve the recommended budget additions for Purchase Power costs, Payments in Lieu of Taxes (PILOTs), and the creation of an exception for increasing Utility employees’ salaries for market rate adjustments. This passed unanimously. No action was taken by the Electric Board regarding the Energy Efficiency Financing Program due to lack of details and information for the increase in funding. 2011 Electric Board 5 Electric Rate Increase Staff presented information from a work session with City Council as well as the recommended increase to all rates in 2012. Changes to rates include: - Increase due to an increase in purchased power from PRPA - All rates will become seasonal - Revision to the residential electric heat rate Service (GS) Rate will be split into two classes (General Service <25 kW Energy Only and General Service >25kW Energy and Demand) - New definition for wholesale transactions to be included in the City Code. The code clarification sets the value of the energy. - Adjustment to Electric Development Fees for a typical single family lot consistent with current construction estimates - Increase in after-hours service charge - Monthly charge for manual meter reading for those opting out of the Automated Metering Infrastructure Program Discussion took place between staff and the Electric Board to clarify some portions of the information. The following motions were made by the Electric Board: The Electric Board recommended that City Council adopt the proposed electric rate increases for all rate classes with the exception of the Residential Energy Rate. Motion passed unanimously with one abstention due to conflict of interest The Electric Board recommended that City Council adopt the proposed changes to the 2012 Electric Development Fees and Charges. Motion passed unanimously  Organic Contract The Electric Board reviewed the Organic Contract and felt it was sufficient at this time. Advisory/Feedback Topics  American Public Power Association (APPA) Metrics Light and Power (L&P) participates in the American Public Power Association (APPA) and provides metrics that are compared with other similar utilities. Light and Power currently serves 65,000 customers. When compared to similar municipal utilities, L&P performs better than the national and regional averages.  2011Energy Efficiency Programs and Results Staff presented the outcomes from these programs with examples from Larimer Country, PRPA’s program support and customers such as Advanced Energy. Staff reported on the products and services provided. Positive results were seen from Larimer County, PRPA, and Advanced Energy to name a few. Hands on labs are 2011 Electric Board 6 presented to local schools. Students are engaged in this effort. Feedback has shown that learnings from these activities find their way to the homes of the students. This is a positive long term plan that should show additional results in the future. Next year, Businesses and schools will be targeted for increased energy education.  PRPA Integrated Resource Plan and Wholesale Rate Design Platte River Power Authority Customer Services Manager presented the draft plan. It focused on a five-year planning window (2012-2016). The plan provides information on resource acquisition to meet future electrical energy demands. This includes contingencies in the event that a major supply (i.e. Rawhide Power Plant) is lost. Conclusions in the report are: - No new firm resources are needed until approximately 2020 - New renewable energy resource needs are anticipated in the 2015 time frame. Purchases will depend on direction from the cities. All cities are buying more renewable resources than required due to city policies. - Final Plan was submitted and approved by the PRPA Board Recommendations in the report include: - Continue demand side management programs. - Implement the Renewable Energy Supply Policy. - Update planning criteria for adding new firm system resources. - Monitor/study regional developments. - Continue contingency planning.  Partnerships with Other Entities/Progress of Energy Policy Initiatives Staff requested information from the Electric Board on the content of these reports. On the two subject initiatives, suggestions were made to provide - Status of a program - Popularity and participation of a program - Financial status i.e. budget, expected outcome, real outcome - Demand reduction status  Meeting the State Renewable Energy Standard .Staff presented the city’s progress in meeting the State renewable energy standard. The two goals are: 1. Reduce carbon emissions 20 percent below 2005 levels by 2020. This includes reducing energy usage by 1.5 percent per year. 2. Meet the State Renewable Energy Standard (RES). This standard applies to municipal utilities with more than 40,000 customers. The standard states that renewable energy should be 3 percent of total energy sold by 2011, 6 percent of total energy sold by 2015, and 10 percent of total energy sold by 2020. In addition the City Council added two additional criteria regarding how the city would meet the renewable Energy Standard: 1. There shall be no additional unbundled Renewable Energy Certificates (RECs) 2. Local projects are desirable 2011 Electric Board 7 Staff presented two local programs to meet the standard. - Fort Collins Solar Program (Two Year Pilot) The Board provided feedback on this program and how it might work. Staff stated that one of goals of the pilot would be to not force a rate increase of greater than one percent. It was anticipated that the first year funding would be $500,000 and $500,000 for the second year. These would provide funding for local projects. - Spent Grain Biomass Program Although this is in the early conceptual stages, the Electric Board identified advantages to this. They include renewable energy, combined heat and power opportunities and it may also benefit wastewater treatment. Staff did a thorough job of addressing the issues, questions and concerns of the board. Informational Topics  Advanced Meter Fort Collins The board received periodic updates from staff concerning the implementation of the Automated Meter Infrastructure. A board member did provide assistance in the data management portion of vendor selection. The project is moving along very well and is on schedule. All appropriate reports have been provided to the Federal Government to ensure them that funding is being used appropriately.  Staff provided Monthly Financial Reports Other There were no appeals brought before the Electric Board in 2011 The Board received public comment throughout the year. Those included:  The 2011 rate increase being excessive and the cost of service study being favorable  Questioned the AMI project and associated benefits justifying the cost  The O-Power cost and benefit. Does the benefit justify the cost  Educating the public on proposed new rate strategies and design. How does the utility reach the folks that do not know much about this topic and make them understand all the issues?