Loading...
HomeMy WebLinkAboutEnergy Board - Minutes - 10/12/2023 ENERGY BOARD October 12, 2023 – 5:30 pm 222 Laporte Ave – Colorado Room ROLL CALL Board Members Present: Bill Althouse, Thomas Loran, Marge Moore (remote), Alan Braslau, Jeremy Giovando, Brian Smith, Vanessa Paul, Bill Becker, Stephen Tenbrink Board Members Absent: OTHERS PRESENT Staff Members Present: Christie Fredrickson, Phillip Amaya, Brian Tholl, Randy Reuscher, Shannon Ash, Lance Smith, Kendall Minor, Leland Keller, Cyril Vidergar, Rhonda Gatzke Members of the Public: MEETING CALLED TO ORDER Chairperson Tenbrink called the meeting to order at 5:30 pm. ANNOUNCEMENTS & AGENDA CHANGES None. PUBLIC COMMENT None. APPROVAL OF MINUTES In preparation for the meeting, board members submitted amendments via email for the September 14, 2023, minutes. The minutes were approved as amended. 2024 RATES & FEES Randy Reuscher, Lead Analyst, Utility Rates Shannon Ash, Affordability Programs Manager Staff is proposing increases across all four utility services in 2024; Electric at 5%, both Water and Wastewater at 4%, and Stormwater at 3%. The Electric increase includes the proposed 5% increase from Platte River Power Authority for wholesale expenses, with the remainder covering distribution system increases. This will equate to roughly an $8.00 annual increase if the customer has all four services. In 2024, Fort Collins will rank as one of the lowest average utility costs among many other front range utilities, including the cities of Longmont and Loveland. There was a one-time 9% inflationary adjustment to the Utility Development Fees in 2023. Staff has updated each Utility Fee for 2024 to be reflective of current asset costs, such as substations and transformers. The new proposed Electric Capacity Fee (ECF) for 2024 is increased by 14.8%, again largely related to the significant increase in asset costs and supply chain issues. Board member Althouse asked how the ECF is assessed. Mr. Reuscher said it is assessed as a dollar per KW fee. When it is assessed on the residential side, it is charged per-panel, so a 200 Amp Panel has a flat charge. Board members discussed the challenge that panel access and upgrade fees could present as the City continues to move toward electrification. ENERGY BOARD REGULAR MEETING Ms. Ash said Council asked staff to improve access to the Utilities Affordability Program (UAP) and the Income Qualified Assistance Plan (IQAP). The IQAP is an auto-enroll program, Utilities customers must apply for and income qualify through the State’s LEAP program. IQAP then provides a 25% rate reduction on electric, water, and wastewater services. Staff found that by moving to an auto-enrollment system, they were unintentionally disqualifying some Utilities customers, because there are some customers who are not eligible or able to apply for LEAP. Staff began looking at alternative entry points, particularly for two specific populations: people with a housing choice voucher (formerly known as Section 8), and households that may have members who are not documented residents. Ms. Ash explained that if the customer is on a housing choice voucher the rent has heat included, then the customer would not be eligible to apply for LEAP because it would be considered “double dipping” in federal assistance programming; however, the customer may still have other utility services in their name so then would potentially still be eligible for the City’s IQAP. LEAP will only count documented residents on their application, so if there are four people living in a house, but only one person is a documented US resident, LEAP will count that as a household of one. This often means that the household will be over the income threshold for the household size, because it is not accounting for the other household members. Staff is working closely with Housing Catalyst and La Familia to connect with some of these missing households, and those external organizations will continue to do the income verification. Board member Braslau suggested using data from the participants in the School District’s free and reduced lunch program. Vice Chairperson Paul asked if LEAP provides the data of the families who did not qualify for the program? Ms. Ash said she could ask for it, but it is not something they are currently receiving. Board member Loran asked if the rate increase would be considered “business as usual” to keep the lights on. Mr. Reuscher said he would say yes, due to Platte River’s forecasted wholesale rate increases for the next several years. Board member Smith said early in the year, it seemed like the Electric Utility had an excess of reserves that other services were tapping into, but now the Utility wants to raise rates. He wondered if there is a disconnect that he is not understanding, or why this money couldn’t be kept to reinvest back into the utility (as opposed to being leant out to Connexion). Mr. Smith said the Utility had reserves marked for use in the Capital Improvement Plan, but that is a 10-year plan, so in the near term that was funding that could be accessed by Connexion, but they were only able to access that money because it’s the Light & Power Telecommunications fund; so, if the Water Utility needed funding they could not have accessed that money. Board member Becker asked if these increases are only for residential rates. Mr. Reuscher said no, the increase is across the electric fund. Staff provides residential examples because they are typically a little easier to understand. There are more components and moving pieces in commercial examples. Board member Loran said he is very process driven and he is currently unsure if the budget and the Capital Improvement Plan support the community’s objectives. He said if he doesn’t have all that information, he can’t be sure if the 5% increase is sufficient or not. In the future he hopes to see a clearer line drawn between what we are trying to achieve, how much will those cost, and is the increase going to sufficiently cover those costs. Staff agreed, sometimes the alignment of the planning and budgeting processes are not always concurrent to the rates and fees increases, but the rates are factored in as part of the forecasting process of the planning and budgeting process. ENERGY BOARD REGULAR MEETING Board Member Becker moved the Energy Board support the proposed changes to 2024 Electric Utility rates and fees. Board Member Smith seconded the motion. Discussion: Board member Loran feels the process is backwards, he hopes staff will make the connection between rates and fees and the planning and budgeting processes going forward. Board member Althouse feels that there should be a caveat that the Utility should be considering any and all technology that can lower rates. Board member Braslau wondered if the Utility could consider a similar path as announced by Green Mountain Power in Vermont limit rate increases; they are planning to add a residential storage battery in the homes of all 270,000 of its customers by 2030. Vote on the Motion: It passed, 7-2 DEMAND RESPONSE BUSINESS UNIT 2024 BUDGET REVISION Brian Tholl, Energy Services Supervisor Pablo Bauleo, Senior Energy Services Engineer Mr. Tholl reviewed how a Distributed Energy Resources Management System (DERMS) aligns with the City’s Our Climate Future Plan, and how the current metrics are pacing against the 2030 goals. Board member Braslau believes that Big Move 12 is not on pace, and should be marked as “red,” as well as the 2030 greenhouse gas metric. Other Board members agreed, that at this point it does seem as though Platte River will not meet those goals and there is no movement to catch up, so to be honest with the community members they should be denoted as such. Staff members and Board members agreed that additional discussion is needed to define and agree on the meaning of “100% Renewable Electricity.” The Board will discuss further at their work session in two weeks. Ahead of the presentation content, Mr. Tholl asked the Board to consider what questions they may have about grid flexibility programs, and at the end staff is seeking a recommendation of support to update the 2024 budget for grid flexibility programs. As a recap, grid flexibility is the ability to develop and utilize technology and systems to match community load with available resources for economic, distribution or carbon benefit purposes. Some benefits of grid flexibility include: it reduces overall cost and extends asset lifecycles (cable, transformers) by managing peaks and valleys, it delivers financial opportunities in upcoming energy imbalance markets, it allows larger penetration of distributed generation in a feeder before upgrades are necessary, it defers distribution transformer upgrades (capital expense), it accelerates decarbonization by matching consumption to renewables availability (i.e., no need to "curtail solar" as many Utilities in AZ and CA are doing), it mitigates solar generation ramp on/off due to widespread installation of PV, and it mitigates future morning winter peaks due to the widespread use of heat-pumps. Staff is proposing to revise the 2023-2024 budget for two reasons, the first of which being that the deployment of a new communication protocol ('23/'24 Grid Flexibility Protocol, IEEE 2030.5) is not moving forward at this time. The second reason is that this is the first opportunity for a request for proposals since the adoption of the 5% bi-directional grid flexibility goal. It is also important to note that the total funding for the 2023-2024 budget cycle is not changing. Offer 1.7 (Grid Flexibility Communication Protocol) was intended for the deployment of an IEEE 2030.5 Open Standard communication protocol platform. The offer was funded at $200,000 in ‘23 and $50,000 ENERGY BOARD REGULAR MEETING in ’24 and would support the software platform to send and receive commands from inverters (PV and batteries). It is Open Standards-based with a “Mix and Match” of make and models, and any manufacturer who supports the protocol can participate. Through detailed planning, staff discovered a “Catch-22” in that OEMs implemented the protocol in a cloud-based platform instead of at the inverter level. OEMs want to charge ongoing “usage fees” (i.e., a “toll”) to communicate with inverters, and Utilities' ability to connect directly to devices is not supported by manufacturers. Mr. Bauleo added that the stand-up cost for the OEM cloud-based platform was extremely high; with the current number of batteries in the community staff was estimating upwards of $10,000 per battery per year to pursue this pathway. At that point staff decided it would be best to regroup and potentially wait for more batteries to be deployed within the service territory before the Utility starts dispatching them. At this point staff would like to carry over the majority of the grid communications offer funding into the 2024 budget, with a modified offer. That would mean closing out/terminating the original grid communications offer and redistributing that funding across three remaining budget offers in 2024. Offer 1.9 "Thermostat upgrade" will receive roughly $100,000 to deploy approximately 400 units instead of 200 units, Offer 1.6 "Connected EV" will receive $50,000 to enroll roughly 150 drivers instead of 75, and Offer 1.3 "Base offer" will receive $100,000 to expand software services (private cloud services, hosting, reporting analytics and advanced dispatch capabilities) in preparation for even larger deployments expected between 2025 and 2030. Board members asked how the Utility will coordinate grid flexibility going forward without the guidance of 2030.5. Mr. Tholl said the Utility will continue to use other communication protocols, like OpenADR (Automated Demand Response). Mr. Bauleo said the Utility has an OpenADR server that has been in use for at least six years. Board member Althouse asked if Staff has looked at any of the Virtual Power Plant options that are coming online right now and go beyond DERMS. Mr. Bauleo said yes, staff has looked into it and the capabilities are not meeting the solutions the Utility is looking for at this time. Board Member Becker moved to support the proposed 2024 budget changes for grid flexibility programs by redeploying the funding for the budget offer originally intended to support IEEE’s 2030.5 Grid Flexibility Protocol. Vice Chairperson Paul seconded the motion. Discussion: Vote on the Motion: It passed unanimously, 9-0 DRAFT 2024 WORK PLAN Board members reviewed the 2023 Work Plan and discussed some of the language they may want to strike or modify, as well as things they may like to add. They agreed to work on the document independently prior to their work session and their next regular meeting, where they will vote to approve it. BOARD MEMBER REPORTS Board member Althouse has been monitoring the Economic Advisory Board and recently spoke to them about Virtual Power Plants. He thinks working with them would be a great opportunity for cross ENERGY BOARD REGULAR MEETING connections and collaboration. Board member Braslau spoke more about Green Mountain Power’s plan to make batteries available to all homes in their service territory with the aim of lowering costs and increasing reliability. FUTURE AGENDA REVIEW The Board will spend more time with their Work Plan at the work session, as well as have additional discussion around 100% Renewable Electricity Definitions. In November, they will finalize and vote on their work plan. The agenda is light so staff and Board leadership will work together to identify additional topics for the November agenda. ADJOURNMENT The Energy Board adjourned at 7:46 pm.