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HomeMy WebLinkAboutEnergy Board - Minutes - 07/11/2019ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 July 11, 2019 – 5:30 pm 222 Laporte Ave.; Colorado Room ROLL CALL Board Members Present: Chairperson Nick Michell, Alan Braslau, Bill Becker, Dan Gould, Krishna Karnamadakala, John Fassler, Stacey Baumgarn Board Members Absent: Vice Chairperson Amanda Shores, Jeremy Giovando OTHERS PRESENT Staff Members Present: John Phelan, Christie Fredrickson, Kevin Gertig, Eileen Dornfest, Tara Muller, Jennifer Poznanovic, Randy Reuscher, Brad Smith, Leland Keller, Wendell Stainsby, Cyril Vidergar Platte River Power Authority: Paul Davis Members of the Public: Rich Stave, Sue McFadden, Nick Francis MEETING CALLED TO ORDER Chairperson Michell called the meeting to order at 5:30 pm PUBLIC COMMENT Mr. Stave said he has a few comments and questions for the Energy Board concerning Metropolitan Districts in Fort Collins, he advised he is not an expert in this topic. He said there is usually a list of things that metro districts must supply, and asked if the City of Fort Collins supplies the remainder of things? He also asked if the standard is raised to a higher level in the metro districts, what happens to the rest of Fort Collins’ residents, especially with respect to building codes (since building code is not retroactive). Mr. Phelan said he would like to help facilitate a connection between Mr. Stave and the City’s Economic Health Director, Josh Birks. Mr. Birks can readily answer questions regarding Metro Districts more thoroughly, since the Energy Board can only address energy-related topics. APPROVAL OF MINUTES In preparation for the meeting, board members submitted amendments via email for the June 13, 2019 minutes. The minutes were approved as amended. ANNOUNCEMENTS & AGENDA CHANGES Board member Karnamadakala announced he will be moving to Massachusetts for a new job, so tonight is his final meeting as a member of the Energy Board. Board member Braslau asked as Board appointments are suspended by the City while the structure of Boards and Commissions are being reviewed, will this vacancy not be filled at present? Mr. Phelan confirmed that this is correct. Mr. Phelan advised the UAP/IQAP Update will be shifted to a future meeting. STAFF REPORTS Executive Director’s Update ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 Kevin Gertig, Executive Director Mr. Gertig said his presentation will focus on Utilities’ current initiatives and then he’ll address any of the Board’s questions. Mr. Gertig said Light & Power crews have been doing ample work on Connexion fiber installation; 50% of the fiber has been installed by the L&P crews. The crews are also continuing to proof conduit ahead of the AEG (outside contractor hired by Connexion) design process. Chairperson Michell asked how L&P is affording the labor and associated costs for the staff and workload needed for this project. Mr. Gertig said L&P is being reimbursed for applicable labor investments, but also he explained that AEG, or any outside contractor, is not qualified to work on the City’s infrastructure, particularly electrical vaults, so the crews need to be there anyway; collaboration between the contractor and the crews was designed into the installation plan from the beginning. Utilities is working toward a fully integrated suite of applications and tools for visualization, optimization, analysis and operations to replace outdated and unsupported technology. Geographic Information Systems (GIS), Graphic Work Design (GWD), and Advanced Distribution Management System (ADMS), are three large projects underway within Light and Power and Utilities. ADMS provides the Utility with a platform to build functionality that will help analyze and control the electric system, smart devices, and Distributed Energy Resources to realize the City’s renewable energy goals for 2030. The 2019 Capital Improvement Plan (CIP) update looks across needed investments for capacity expansion, asset replacement, and technology based on the L&P Master Planning Guidelines and City policies. The CIP should build upon the Utility’s legacy of reliability and affordability while recognizing a future vision of renewables, electrification, and community growth. Mr. Gertig said the Utility is somewhat behind in the way customer energy engagement information is delivered to utilities customers, so staff is working on modernizing the way that information, such as home energy reporting, is accessed and delivered to customers. Epic homes is a comprehensive home performance framework that addresses customer barriers to home efficiency upgrades and establishes a framework for scalability (via financing and in the rental market) and valuation (IEQ study, certificate and realtors). Mr. Phelan said Efficiency Works Homes and Participating Contractor Network has been the core of recent staff work. Board member Baumgarn said he knows it’s still early, but he would like Mr. Gertig to come back to discuss Budgeting for Outcomes (BFO) prior to the process getting underway. He said the Board is always curious about what ideas and priorities is Mr. Gertig is anticipating, etc., even if is still very early. Halligan Water Supply Project Update Eileen Dornfest, Halligan Project Manager Halligan Reservoir is an existing reservoir located on the North Fork of the Poudre River. If the Halligan Water Supply Project is approved, it will enlarge Halligan Reservoir by approximately 8,100 acre-feet to help provide additional protection for Fort Collins Utilities' water customers from future service interruptions in the event of prolonged drought or emergencies. Ms. Dornfest said the project has been in the permitting phase for 13 years and is approaching a permitting milestone, as this will be the first time the public will have a chance to review and provide feedback on the Halligan project. The Board was shown a short video about the Halligan Water Supply Project. ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 Board member Braslau asked if the current storage capacity of Halligan Reservoir is owned by the City of Fort Collins. Ms. Dornfest said the water is owned by North Poudre Irrigation Company and the City of Fort Collins purchased the dam and the underlying property from them. In this project, Halligan Reservoir’s water is for Fort Collins Utilities’ Water service area only, other areas within the City’s Growth Management Area (GMA) receive their water from other suppliers, such as ELCO Water District or Fort Collins Loveland Water District. Ms. Dornfest added that the Halligan Project is designed to provide additional reliability to the water Utility, as well as accommodate population growth within the Utilities service area through 2065. For context, Horsetooth Reservoir is approximately 157,000 acre-feet. If Halligan is enlarged, the proposed total volume is approximately 14,500 acre-feet—or about 1/10 the volume of Horsetooth Reservoir. Using data from 1950-2005, staff created an artificial model to demonstrate the possible use of the Utility’s portion of controlled releases for improved downstream river flows, as well as heavier releases during drought periods. Board members needed clarification that the graphic shown is strictly a model based on the data from North Poudre Irrigation Company, but the Utility would not be operating their portion of the reservoir the same way, so it is considered an artificial model. Ms. Dornfest indicated the bottom line of the model is to show how the Halligan project doesn’t draw water from the river year after year like some other proposed water projects in Colorado. Chairperson Michell asked if the Halligan project competes with NISP (Northern Integrated Supply Project) for water sources? Ms. Dornfest said the environmental impact statement, that will be released in the fall, addresses what is called “cumulative impacts,” which is anything that is a foreseeable action that will impact the river in the next 50 years. That section will include Halligan’s additional impact on the river in conjunction with NISP. Despite the lengthy timeline of the Halligan Project, it remains the most cost-effective project option to meet the demand for a reliable water supply in Fort Collins. As part of the Environmental Impact Statement process, the Army Corp of Engineers is required to look at alternatives in addition to the proposed Halligan Water Supply Project. Some of those alternatives are gravel pits, agricultural reservoirs, an expanded Glade Reservoir, or no action. In general, the actionable alternatives differ from the Halligan project in that they require considerable pipeline infrastructure to connect to the Water Treatment Facility, and that the water must be pretreated before reaching the Water Treatment Facility, as well as ongoing pumping to maintain operations (meaning greenhouse gas emissions). Because of those reasons, the alternative options will equate to higher cost, up to 4.5 times more than the Halligan Project. Operation of an enlarged Halligan Reservoir would result in a slight decrease in river flows in the North Fork and the Poudre (upstream of Laporte) during spring runoff, but an increase in river flows during most months of the year. The project has many benefits, but inherent benefits to the river are what set this project apart: it would re-establish flows to a river that currently runs dry in some locations in late summer, due to dam and downstream diversion structure operations, and river connectivity is a fundamental need for a healthy ecosystem that’s missing today. Additionally, the project will help improve water temperatures and rehabilitates the aging dam on the reservoir. Chairperson Michell said if the project does not get approved, the dam still needs to be rehabilitated—he wondered whose responsibility that would be without the Halligan expansion. Ms. Dornfest said the purchase agreement with the North Poudre Irrigation Company states if the expansion project is not approved, the dam goes back into their possession and it will be their responsibility to rehabilitate it. ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 Chairperson Michell asked if the dam rehabilitation project has a chance of providing hydropower, or is the dam too small? Ms. Dornfest said staff plans to evaluate that option as part of the design, but the design work as not begun yet. Board member Braslau asked what the height of the dam is and what might be the generation potential? and Ms. Dornfest said it will only be 100 feet high; she acknowledged that is not very tall. Mr. Phelan added that adding hydropower to the dam would complicate the permitting even more, and Ms. Dornfest agreed, which is why they are exploring the option hydropower only as a retrofit. IMPACT FEE UPDATE Jennifer Poznanovic, Senior Manager Sales Tax & Revenue Randy Reuscher, Utilities Lead Rate Analyst (attachments available upon request) Mr. Reuscher explained the City’s Fee Update timeline and presented a corresponding graphic. Staff completes a detailed fee study analysis every four years to set Capital Expansion Fees (CEFs), Transportation CEFs & Development fees, and a detailed fee study analysis is completed every 2 years for Utility fees. Additionally, staff conducts a fee study analysis in the odd year before BFO, and staff makes an adjustment for annual inflation in years without updates. The methodology for Electric Capacity Fees (ECF) calculations was last updated in 2017. In 2019, staff updated current costs and kW demands in the model. There is an overall ECF increase of 3.5%, but the specific increase amount varies by type of construction: The Residential ECF is based on electric panel size, the number of dwelling units, and if the residence uses gas or electric heating. The Commercial ECF is based on the requested amperage, single- or three-phase power system, voltage, as well as primary or secondary metering. Board member Baumgarn asked if staff’s request for support is related only to ECFs (the 3.5% increase), and not the Water Plan Investment Fees, etc., which were not presented. Mr. Reuscher said yes, tonight he is seeking the Energy Board’s support regarding the 2020 Electric Capacity Fee Increase of 3.5%. Board member Becker asked if the ECF increase would effectively drive the behavior the Utility and community wants (such as encouraging conservation), Mr. Reuscher said from the Utility perspective, the one-time ECFs are separate from the monthly ongoing fees that drive the conservation behaviors the community is looking for. Board member Baumgarn moved that the Energy Board support the proposed 2020 Electric Capacity Fee, as proposed by staff, and recommend approval of this fee by City Council. Board member Becker seconded the motion. Discussion: None Vote on the motion: It passed unanimously, 7-0, with two absent ICC ENERGY CODE LOCAL GOVERNMENT PARTICIPATION Brad Smith, Energy Code Compliance Specialist John Phelan, Energy Services Senior Manager (attachments available upon request) The International Energy Conservation Code (IECC) is part of the International Code Council (ICC) body ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 of codes. The IECC is updated every three years and is regulatory for Residential, Commercial, Multifamily buildings. The City of Fort Collins Energy Policy requires adoption of the IECC within one year of issuance, and the City officially adopted the 2018 issuance of IECC with local ammednments on January 12, 2019. Mr. Smith said the City has an upcoming role in voting for improved energy efficiency codes; this stems from the City’s recognition that we can and do play a role in impacting future iterations of IECC. Recently, efficiency gains within new IECC issuances have somewhat stagnated due to opposition from special interest groups who have a desire to roll building efficiency codes backwards. Voting parties have defeated many of the roll back attempts and have been able to maintain the current efficiency standards, but that is not considered a victory since there has not been any forward progress. Board member Fassler asked who the special interest groups are. Mr. Smith said the largest group is the National Association of Home Builders, and this group holds four of the eleven voting seats of the board. From 2006-2012 efficiency gains through IECC released codes alone were at nearly 30%, but from 2012- 2018 efficiency gains were only 6-7% realized. Mr. Smith reviewed several reasons why local government voting for IECC improvement matters. In the United States, buildings use approximately 40% of the energy, and 70% of that energy is electricity. Building emissions also account for 39% of the carbon emissions in the US; however, in Fort Collins the carbon emissions are closer to 60%. After loss of income, energy cost is the leading reason for foreclosure; after mortgage, principal and interest, energy is the highest yearly cost of homeownership. The McKinsey Center for Business & Environment released a report, “Focused Acceleration: A Strategic Approach to Climate Action in Cities to 2030,” which stated that building energy code is the most cost- effective means of greenhouse gas reduction, and in the same report it was stated “…flat gains of the last two codes are not enough to help local governments achieve their energy and climate goals.” Mr. Smith also noted that Zillow Group reported prospective home buyers rated energy efficiency as one of the most desirable features in their search, which is a large societal shift. Board member Braslau commented that water is a large annual cost for homeowners in Fort Collins and asked if the cost of water is more of a financial burden than energy for Fort Collins Utilities customers. Mr. Smith said the numbers he is presenting are largely national, but he said that this is likely true in Fort Collins, and water use codes are particularly important in this community. Mr. Smith said many local governments, the City of Fort Collins included, have realized they have a voice in not only the language of the code proposals, but also when and where support for code proposals can be voiced, and that there is opportunity to work with committee members to co-sponsor code proposals. Most importantly, as a local government, the City of Fort Collins has voting power once the proposals go to the public (for a two-thirds majority vote). There are approximately 20,000 governmental member voting representatives (GMVR) nationwide. In the last code cycle, less than 500 GMVRs cast votes for IECC proposals, but if about 550 GMVRs had voted for proposals with increased energy efficiency measures, it would have been enough to have them included them in the 2018 IECC. Mr. Smith added that in 2018, the US Conference of Mayors, of which Mayor Troxell of the City of Fort Collins is a member, passed resolution urging local governments to maximize support for putting the IECC on a glide path toward net-zero energy by 2050. Earlier this year, cities and states across the country signed up over 500 new Governmental Memberships by the voting eligibility deadline, the largest participation by governments ever in the code development process. Of those Governmental Memberships, the City of Fort Collins holds four, Utilities, ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 Building, Sustainability, and Poudre Fire Authority. Because the City has a population of 150,000 or more, each one of the four memberships is allowed 12 votes (48 total votes for the City of Fort Collins). The voting window is November 13-27. Board member Gould asked how an advocacy group establishes their eligibility to have voting privileges. Mr. Smith said there is likely outreach from opposing organizations to other governmental members, but there are not non-governmental voting members at the public release of the proposals. Chairperson Michell asked what sort of governmental entities can vote, and Mr. Smith said any organization within a local government that enforces code or regulations, such as utilities, cities, or counties. Mr. Michell also asked what sort of code changes is staff and the International Code Council looking for? Mr. Smith said at a minimum a 5% increase in efficiency, but ideally a 10% increase each code cycle so that by 2050, the standard building code is net-zero energy. Board members suggested reaching out to Larimer County and their Commissioners to urge them to enroll as voting members as well. METRO DISCTRICS ENERGY STANDARDS Energy Board Discussion (attachments available upon request) Chairperson Michell reminded the Board they are only allowed to make recommendations regarding the energy efficiency and other energy-related components of metro districts, non-energy-related components, such as affordable housing, etc., are not within the Energy Board’s purview. PiCA (Partners in Climate Action) submitted a proposal to the Energy Board for their comments before they submit it to City Council. PiCA is looking for specific guidance on the following five points: 1. The Department of Energy’s (DOE) Zero Energy Ready Home standard must be met, which includes the Indoor AirPlus and the WaterSense hot water distribution programs, with third-party verification; 2. A HERS (Home Energy Rating System) score of no more than 50 must be achieved; 3. A balanced ventilation system (ERV or HRV) must be installed; 4. A duct leakage of no more than 4% must be achieved; 5. An average of 3 kW per unit on attached and detached single-family units must be installed unless Passive House standards are met. Chairperson Michell said he was reviewing the DOE’s Zero Energy Ready Home standard and noted it has a performance path and prescriptive path; he asked if the Board is recommending the performance path. Board member Fassler said yes, and furthermore, ensuring compliance and enforcement is one of the biggest challenges energy efficiency standards face. Board member Braslau commented Council may push back on that initiative because the workforce might not be in place to handle that workload. Chairperson Michell asked Mr. Smith hypothetically, if tomorrow everyone had to be zero-energy ready, would there be enough people in the workforce to handle that. Mr. Smith said the third-party verification workforce, such as HERS raters, is already well-established in Fort Collins. Board member Fassler said in his opinion, it is ridiculous to build an airtight home and then try to suck air out of it. Chairperson Michell said item number three would be a good topic to bring to the Air Quality Advisory Board. Board member Braslau said he attended an AQAB meeting recently and they are interested but he was left with the impression they don’t receive a lot of educational presentations about building codes and indoor air quality, particularly as it might pertain to metro districts. Mr. Francis said he did speak to the AQAB briefly about indoor air quality. ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 Board member Fassler explained that the Net Zero ready standard for duct leakage is somewhat weaselly, meaning a home could have leaky ducts and still pass. He would like to see the standard set closer to 0% as opposed to 4%, nothing that we do not tolerate leakage for water plumbing, as an example. Chairperson Michell said he sees the argument for including 3 kW of solar, because it is much less expensive for the developer to install than it is for a homeowner to retrofit it. Board member Braslau said it also forces the developer to consider the solar orientation on the roof when they may not otherwise consider that. Mr. Phelan said Fort Collins does have zoning development-scale requirements regarding solar orientation. Chairperson Michell said there’s two things he would like to point out: he and the Board would like to see a standard that has the flexibility to evolve with the advancement of future energy efficiency capabilities. Additionally, the Board wants to talk about the policy, and not necessarily the implementation. Mr. Phelan encouraged the board to think about what the guiding principles they would like to capture in that policy goal, versus the specifics of any proposal which could up or down, or in this year or next year, whenever is appropriate. Board member Gould said it seems important to not pick apart the details too much, but to somehow acknowledge this is a window of opportunity before all the homes are built. It is more important to convey a sense of urgency and maintain flexibility for future iterations. Board member Braslau agreed, he said it is very important to view the metro districts as with a sense of urgency and as an opportunity to drive general building code forward. All buildings should meet these standards, but the metro districts should lead and set the precedent, because this is where most of the future residential building will take place in Fort Collins. Board member Baumgarn noted one of the desired outcomes in the proposal is to use the success of the metro districts to increase energy efficiency standards, so whatever the Board proposes today does not have to remain stuck in time. If efficiency increases, the standard should increase with it. Board members agreed the PiCA proposal is the minimum set of standards the Board would support, but they would like to convey their desire to leave room for forward motion and growth as energy efficiency technologies and capabilities change. Mr. Vidergar advised the Board to encourage City Council through a recommendation to adopt a concept of setting minimum energy efficiency standards for metro districts that are modeled on the PiCA proposal. Their motion language and supporting discussion can be summarized in a memo drafted by the Board chair. Board member Becker said in order to support the goals of the Climate Action Plan, it’s imperative that City Council put forth minimum energy standards for metro districts, and the Board supports the PiCA proposal as a guideline and model of those minimum standards. He added it’s important to note the specifics within the proposal are quite good and he does not want that message to become diluted in translation. Chairperson Michell moved to recommend City Council supports the urgent adoption of minimum energy standards for metro districts, modeled on the specific elements of the PiCA proposal as further set forth in a subsequent memo from the Energy Board Chair. Board member Baumgarn seconded the motion. Discussion: ENERGY BOARD REGULAR MEETING ENERGY BOARD MEETING |07/11/2019 Board member Becker proposed a friendly amendment to add language reiterating the how these standards could be a vital piece of meeting the goals of the Climate Action Plan. In support of the City’s Climate Action Plan goals, Chairperson Michell moved to recommend City Council urgently adopt minimum energy standards for metro districts modeled on the specific elements of the PiCA proposal as further set forth in a subsequent memo from the Energy Board Chair as delegated by the Energy Board. Chairperson Michell accepted the amendment. Vote on the motion: It passed unanimously, 7-0, with two absent. BOARD MEMBER REPORTS Board Member Braslau said that some boards, as well as Council, are receiving push back from legal staff about topics they can discuss concerning development projects. FUTURE AGENDA REVIEW The Board will draft their 2020 Work Plan at the August 8 meeting, the final copy is due to the City Clerk’s office in September. UAP/IQAP Update has been moved to the August meeting. Mr. Phelan said there is a work session scheduled for August 22, if there are topics to discuss and staff support available. ADJOURNMENT The Energy Board adjourned at 8:47 pm.