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HomeMy WebLinkAboutEnergy Board - Minutes - 04/05/2012Energy Board Meeting Minutes April 5, 2012 1 Fort Collins Utilities Energy Board Minutes Thursday, April 5, 2012 Energy Board Chairperson City Council Liaison Ross Cunniff, 420-7398 Lisa Poppaw, 223-4136 Energy Board Vice Chairperson Staff Liaison Barrett Rothe, 303-881-9683 Brian Janonis, 221-6702 Roll Call Board Present Chairperson Ross Cunniff, Vice Chairperson Barrett Rothe, Board Members Britt Kronkosky, Greg Behm, Peggy Plate, Peter O’Neill, Margaret Moore, and Stacey Baumgarn Staff Present Brian Janonis, Steve Catanach, Patty Bigner, John Phelan, Lance Smith, Lucinda Smith, Tom Vosburg, Jenny Lopez Filkins, Norm Weaver, Sharon Held, Robin Pierce, and Harriet Davis Board Absent Board Member Steve Wolley Guests Karey Christ-Janer, Rick Coen, and Council Liaison Lisa Poppaw Meeting Convened Chairperson Cunniff called the meeting to order at 5:35 p.m. Public Comment Karey Christ-Janer, a citizen of Berthoud, introduced herself to the board. Ms. Christ-Janer is a renewable energy advocate in Colorado and California. She attended this meeting because she is interested in several items on the agenda. She supports the concept of Community Choice Aggregation (CCA). This allows cities and counties to aggregate the buying power of individual customers within a defined jurisdiction in order to secure alternative energy supply contracts. She would like Utilities to integrate different forms of renewables, such as a biomass facility. She also encouraged Utilities to support an energy imbalance market and encouraged the purchase of wind energy. Approval of March 1, 2012 Minutes Vice Chairperson Rothe moved to approve the minutes of the March 1, 2012 meeting. Board Member O’Neill seconded the motion. Vote on the motion: Yeas: Baumgarn, Behm, Cunniff, Kronkosky, O’Neill, Plate, and Rothe. Nays: none. The motion carried. The minutes were approved unanimously. * Board Member Moore was not present during the voting. Energy Board Meeting Minutes April 5, 2012 2 Platte River General Manager Recruitment Criteria (Attachments available upon request). Utilities Executive Director Brian Janonis introduced this item. Councilmember Gerry Horak requested a list of criteria from members of the Energy Board for the new Platte River Power Authority (PRPA) General Manager. The current General Manager retires in June. The board members discussed what criteria should be included and also suggested some potential questions to ask during the interview process. These suggestions will be included in a letter to Mr. Horak. Vote on the motion: Yeas: Baumgarn, Behm, Cunniff, Kronkosky, Moore, O’Neill, Plate, and Rothe. Nays: none. The motion carried. Council’s Vision for the Energy Board Council Liaison Lisa Poppaw introduced the item and stated she would like the board to focus on high level items. Council would like the board to stay engaged with Council agendas as well as the Six-Month Planning Calendar. Ms. Poppaw also encouraged the board members to comment on Council agenda items. Council would like the Energy Board to generate ideas for discussion. Ms. Poppaw also encouraged the board members to communicate with Council. Board discussion: A board member questioned how to communicate with Council? Ms. Poppaw stated members should only represent the board if they are speaking on behalf of the board. Otherwise, they should represent themselves as private citizens. Chairperson Cunniff asked if Council has seen the Energy Board’s 2012 Work Plan. Ms. Poppaw stated Council has seen the work plan and there were no comments. A board member questioned how far into the future the board can look. Ms. Poppaw stated a Futures Committee has been formed. This committee will look 30 plus years into the future at issues that are facing the City. Chairperson Cunniff stated the Energy Board would like Council’s feedback on what the board is doing. Ms. Poppaw stated this feedback will be shared with the board. How does Council interact with other jurisdictions? How does the Energy Board get this information when it is relevant to the work plan? Ms. Poppaw stated Council would like to have conversations with other communities. She suggested that perhaps the Energy Board Chairs should write letters on behalf of the Energy Board to other community leaders. Fort Collins Solar Program and Renewable Energy Requirements (Attachments available upon request). Light and Power Operations Manager Steve Catanach introduced the item and introduced Senior Energy Engineer Norm Weaver. Mr. Catanach presented two goals with the program: Vice Chairperson Rothe moved that the Energy Board accept the bullet points and questions and direct Chairperson Cunniff and Mr. Janonis to compose the final letter. Board Member Kronkosky seconded the motion. Energy Board Meeting Minutes April 5, 2012 3 1. Reduce carbon emissions 20 percent below 2005 levels by 2020 (Energy Policy: reduce energy usage by 1.5 percent per year) 2. Meet the State Renewable Energy Standard (RES) (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) Carbon Goals Mr. Catanach presented a graph showing the cost of carbon reduction. Energy efficiency programs are a lower cost route to carbon reduction. The graph shows the differences between energy efficiency programs, wind, and solar power. The addition of renewable energy is not necessarily the least expensive route to carbon reduction. State Multipliers The state allows the use of multipliers to meet the RES. Regional solar projects can multiply the Renewable Energy Credit (REC) produced by three times towards the RES. Local non-solar community projects can use a 1.5 times multiplier. Colorado based projects can use a 1.25 times multiplier. Projects connecting directly to a municipal system can use a 2 times multiplier. The use of multipliers is currently being challenged through the Colorado courts. Board discussion: A board member asked for clarification on the use of the term “regional.” Mr. Catanach stated this is typically within the state of Colorado. A board member asked for clarification on the multiplier. A project built prior to 2015 would keep the multiplier. A board member asked for clarification on the connection to the municipal systems. These would meet at the distribution level. What basis are the plaintiffs arguing to challenge this? Assistant City Attorney Jenny Lopez Filkins stated the plaintiffs are arguing this is a violation of the United States Constitution Commerce Clause. Ms. Lopez Filkins also gave an update on the case. The parties are still briefing on a motion to dismiss. The court allowed several interveners to the case. A board member asked for clarification on what it means for the other parties to intervene. Ms. Lopez Filkins stated the other organizations argued they should be parties to the suit because they have an interest to the outcome. The courts agreed with the other parties. They have requested the courts dismiss the lawsuit so both sides will be given an opportunity to argue their case in writing. Identify Options and Triple Bottom Line (TBL) Impacts Mr. Weaver presented a renewable energy options matrix showing TBL criteria (economic, environmental, and social). The list includes criteria such as overcoming financial and institutional barriers, expanding distributed generation options, and providing replicable and scalable options. Fort Collins Solar Program Mr. Catanach presented information on the Fort Collins Solar Program (FCSP). The proposal is to offer a standard 20-year Purchase Power Agreement (PPA). There would be a single equivalent incentive of 14 to 16 cents per kilowatt hour (kWh) and this would add approximately two megawatts (mW) of solar capacity per year. Energy Board Meeting Minutes April 5, 2012 4 Third Party Contracts Mr. Catanach presented information on third party contracts. This model has been utilized at the water treatment facility. The energy is purchased from a third party, and the finance/leasing entity installs and owns the system. The host/owner pays the lease or energy contract with the finance entity and sees a reduced use on the net meter. Community Solar Garden Community Solar Gardens are geared towards those individuals interested in investing in solar power, but may not have the means to achieve this. The customers are given the benefit of owning a system. The operator/finance entity installs and manages “subscription” ownership of the system. Other Options Mr. Catanach presented information on a utility scale solar plant and a “spent grain” biomass plant. RES Compliance Annual Cost Mr. Catanach presented a graph showing the renewable compliance annual cost for local renewable energy, solar photovoltaic (PV), biomass, and regional wind, as well as unbundled RECs. Board discussion: Are these costs annual costs? Yes, the costs presented are annual costs. A board member questioned if an energy asset survey has been conducted for the City of Fort Collins or PRPA territory? Mr. Catanach stated Utilities is currently working with Symbiotic Engineering. They are conducting analyses to identify the square footage of rooftops within the City to determine the potential for solar power. Also, Utilities has also worked with ICE Energy to identify the capacity for thermal storage within the City. A waste inventory study has been conducted with the Natural Resources Department to identify the potential for waste to energy. Also, PRPA has conducted a wind study on Meadows Spring Ranch. Has a hydro analysis been conducted on the water systems? Mr. Catanach stated a hydro study was conducted several years ago at the inlet to the water treatment plant. There is the potential for a small hydro plant; however, there are challenges with the licensing requirement costs. A board member requested an inventory of energy resources within the City and estimates within the PRPA boundaries. This information will be provided to the board members. A board member expressed concern that Utilities is only doing what fits within the boundaries even if it is not an effective energy source. He feels that unbundled RECs should not be used and feels that other potential resources should be identified. Mr. Catanach stated that leveraging of different technologies will be required in looking ahead to 2050 and beyond. Utilities is planning for future technologies by setting the path today. A board member asked for clarification on the other PRPA participants regarding the renewable energy standard. Mr. Catanach stated municipalities with more than 40,000 meters must meet the RES standard. The City of Fort Collins and the City of Colorado Springs are the only municipalities in PRPA that qualify. Direction Requested Mr. Catanach stated Utilities is seeking feedback from the board on the following two questions: Energy Board Meeting Minutes April 5, 2012 5 • Should the City apply the multipliers to control cost of meeting the RES? • During the upcoming budget process should Utilities return with the associated ½ percent rate increase for 2013 and an additional ½ percent in 2014 in support of the Fort Collins Solar Program? Board discussion: How large is the potential for the solar garden project? Mr. Weaver stated this potential still needs to be determined. What is the likely cost outcome if the lawsuit is lost? Mr. Catanach stated this is challenging to answer accurately; however, looking to the 2015 timeframe and anticipating a decline in renewable costs, other resources would have to be considered. Would the same number of projects be built with or without the multipliers? Fewer projects would be built with utilizing the multipliers. A board member asked for more information on unbundled RECs. Mr. Catanach stated this information can be provided to the board. A board member supports local energy generation projects because of the reduced carbon load on the atmosphere. He believes that carbon based energy costs will increase dramatically in the next twenty years. The reason for the multipliers is to encourage Colorado based businesses. Does this allow the City to meet the RES independent of the direction that PRPA goes? The board member asked if this program is a feed-in tariff program. Yes; however, Utilities will continue to pursue the rest of the portfolio. A board member stated the City of Fort Collins should not be satisfied with meeting the minimum possible. Customer and Employee Relations Manager Patty Bigner stated the RES was reduced to be compliant with the state minimum renewable energy requirements when the Energy Policy was written in 2009. At the time, that was the least expensive way to reach the goal. A board member stated that alternative renewable energy resources should be utilized. Human and intellectual capital should also be used in regards to industry. The board member supports the use of bundled RECs. Discussion on the motion: A board member asked for clarification on staff’s opinion on the use of multipliers. Mr. Catanach stated this has been evaluated using the TBL approach. In regards to the economic component, it is a way to maintain costs with an investment in renewables. In regards to the environmental aspect, there is a carbon reduction benefit. On the social side, these programs will support the community and benefit the citizens. A board member stated she would not support the use of the multiplier because the carbon reduction goal was lowered. Vice Chairperson Rothe moved that the City should apply the multipliers to control the cost of meeting the RES. Board Member Kronkosky seconded the motion. Energy Board Meeting Minutes April 5, 2012 6 A board member expressed concern about the rate payers and their understanding of the program. He questioned how the Energy Board’s directions will impact the ratepayers. Chairperson Cunniff suggested the Energy Board should temper their objections since the proposed rate increase is also coming along with the Advanced Meter and tiered rate structure. A board member stated he would feel better about the use of multipliers in the short term if it was coupled with the idea of not aspiring to the minimum level of compliance. Vote on the motion: Yeas: Baumgarn, Behm, Cunniff, Kronkosky, Moore, and Rothe. Nays: O’Neill and Plate. The motion carried. Reason for the nay votes: Board Member O’Neill: Alternative renewable energy resources should be utilized. Board Member Plate: The renewable energy goal was lowered to meet the state standard. Discussion on the motion: A board member asked for clarification on the use of the word “return” in the motion. This item was presented to the Electric Board in July 2011. The board suggested this item should be presented to Council at a later time. A board member questioned other potential rate increases. PRPA will also have a rate increase due to an increase in coal costs. A board member questioned the statement concerning that the ½ percent rate increase could be completely allocated to the Fort Collins Solar Program or apportioned to several types of solar incentives. The board member asked for clarification on which programs would be affected. Mr. Catanach stated the intention is to focus on the Fort Collins Solar Program. A board member asked if the rate would be reduced if the program fails. The program will be evaluated since it is a pilot program. A board member asked for clarification on how the rate increases will be communicated to the ratepayers. The PRPA rate increase will be communicated to the ratepayers. Vote on the motion: Yeas: Baumgarn, Behm, Cunniff, Kronkosky, Moore, O’Neill, Plate, and Rothe. Nays: none. The motion carried. Potential City of Fort Collins Public Electric Vehicle Charging Station Pilot Program (Attachments available upon request). Mr. Catanach introduced the item and introduced Light and Power Policy and Project Manager Tom Vosburg. This item is brought before the board for discussion on whether or not the City should be involved in the issue of public electric vehicle charging stations. Vice Chairperson Rothe moved that Utilities should return with the associated ½ percent rate increase for 2013 and an additional ½ percent in 2014 in support of the Fort Collins Solar Program. Board Member Baumgarn seconded the motion. Energy Board Meeting Minutes April 5, 2012 7 Background: Electric Vehicle Community Readiness Initiative The readiness initiative includes providing public information on www.fcgov.com, clarifying the permitting process, and installing Level 2 charging stations at the Utility Service Center. Public versus Private Charging Mr. Vosburg presented information on the different models (private, customers, and public). The first two models are more established. The public model is an emerging model and best practices have not been established yet. Electric Vehicle Charging in Fort Collins: Current Status Mr. Vosburg presented information on current vehicle charging stations within the City. The current number of electric vehicle owners is unknown in the City of Fort Collins. Public Charging Station Issues Mr. Vosburg presented information on the issues related to public charging stations (parking ordinance revisions, reserved spots, city operated versus privately owned, etc.). Board discussion: What is the City’s motivation to offer this program? Mr. Vosburg stated this program can align with the City’s energy conservation and carbon reduction goals. Is this program a way to encourage the use of electric vehicles? Mr. Catanach stated this item is brought before the board to seek feedback on whether or not Utilities should be involved in this program or if it should be implemented by Parking Services. A board member feels this is more of a role for private industry. This may not be sustainable as a City program in the long run. He feels individuals may view Utilities as subsidizing one type of program to meet their energy goals. How much does a charging station cost? Mr. Vosburg stated the charging stations as listed in the presentation cost approximately $3,000. It can cost approximately $20,000 for installation. Has there been citizen or Utility customer requests for public charging stations? Mr. Catanach stated there have been customer inquiries concerning what level of support Utilities may provide in regards to charging stations; however, there have not been specific requests. A board member asked for clarification on the customer fees for using the charging stations (operational fees, credit card fees, etc.). Will it be worth the fees to charge for only a short amount of time? Mr. Vosburg gave some background on the charging station program in Boulder. Their fees charged include the cost of the energy and the cost of the infrastructure. Mr. Catanach stated there is legislation recognizing that utilizing energy for fuel does not qualify an entity as an electric utility. He gave the example of master metering restrictions. The master metering ordinance is more focused on property, not on charging stations. Therefore, some private entity could open a business and charge for the services. A board member stated there are not enough electric vehicles to support a private model; however, Utilities could serve an initial role by encouraging the purchase of electric vehicles by offering the service. The private sector could become more involved over time. Energy Board Meeting Minutes April 5, 2012 8 A board member suggested it is a good idea to provide a minimum level of infrastructure, particularly on the south end of town, incorporating the South Transit Center at Harmony Road. A board member stated signage policies should be developed. Systems and ideas should be in place. The board member also stated he would like to see the exit strategy with the program, and would also like to see a strategy to incentivize off-peak hour charging in public places. A board member stated the City of Fort Collins is getting notoriety from these types of programs. These types of programs will encourage new businesses to come to the area. Does money for the program come from the General Fund? Mr. Catanach stated this would come from the Utilities fund. Has this item been presented to the Transportation Board? This item has not been presented to the Transportation Board; however, Utilities has discussed the program with both the Transportation Planning Department and Parking Services. A board member asked for clarification on whether the Energy Board should answer the three specific questions outlined in the Agenda Item Summary provided to the board. Mr. Vosburg stated the board only needs to consider the first question regarding if the City should initiate a new pilot program. If the board supports the program, would a budget offer be presented? Mr. Janonis stated staff would probably not initiate a program if the Energy Board does not think it is a good idea; however, Council or the City Manager could request that Utilities submit a budget offer for the program. A board member expressed concern about the use of the term “pilot program.” Discussion on the motion: A board member stated he feels the wording of the amended motion complicates the language of the original motion. A board member feels the amended motion eliminates ambiguity regarding right-of-way and on or off street parking. Vote on the first motion: Yeas: Baumgarn, Behm, Cunniff, Moore, O’Neill, Plate, and Rothe. Nays: none. The motion carried. Board Member Behm moved that the Energy Board support staff’s recommendation that the City proceed with developing a 2013-2014 BFO offer to support a public electric vehicle charging station pilot program. Vice Chairperson Rothe seconded the motion. Amended Motion: Board Member O’Neill moved that the Energy Board support staff’s recommendation that the City proceed with developing a 2013-2014 BFO offer to support a public electric vehicle charging station pilot program for City-owned parking facilities. Chairperson Cunniff seconded the motion. Energy Board Meeting Minutes April 5, 2012 9 Discussion on the amended motion: A board member questioned if the word “pilot” can be removed from the name. Does it change the meaning? A board member interprets the use of the word “pilot” to mean that the City is trying the program to see how it works. It may not necessarily be a permanent program. Vote on the amended motion: Yeas: Baumgarn, Behm, Cunniff, Moore, O’Neill, Plate, and Rothe. Nays: none. The motion carried. ** Board Member Kronkosky abstained from voting due to a conflict of interest. Medical Discount Program for Electric Customers (Attachments available upon request). Mr. Janonis introduced the item and introduced Strategic Financial Planning Manager Lance Smith. This item was presented to the Energy Board in February and to Council in March. This item is presented to the Energy Board again because Council would like to see more public outreach, a couple of alternatives with the program, and an appeal process. Background Those individuals using durable medical equipment may be adversely affected by the tiered rates. Fort Collins Utilities has met with several patient advocacy groups as well as physicians to discuss the needs of the patients that may be affected. As a result of meeting with these groups, Utilities will propose that Council consider several options for the program. Program Purpose The program is proposed to enhance the quality of life for the citizens of Fort Collins as well as to maintain community conservation values. Utilities would like to provide the same incentive for the customers to conserve energy. Program Options Mr. Smith provided a handout showing the three options, pros and cons of each option, and associated costs: Option A only allows life support devices (only eligible equipment would be equipment necessary to sustain life). This option would cost approximately $20,000 with income limitations, or $50,000 without income limitations. Option B would include any type of medical equipment that would use electricity. This option would cost approximately $80,000 with income limitations, or $200,000 without income limitations. Option C would also include an allowance for air-conditioning for those individuals with immune- compromising diagnoses, such as multiple sclerosis. These individuals would be given an allowance for air-conditioning during the summer cooling season (June, July, and August). This option would cost approximately $110,000 with income limitations, or $270,000 without income limitations. Energy Board Meeting Minutes April 5, 2012 10 Board discussion: A board member asked if this includes the use of hot tubs. These would be covered if hot tubs are included in the medical coding system. What is the income limitation? This is based on 60 percent of the area median income. Will you ask Council to pick one option? Yes, staff will recommend Option C with the income limitation. Chairperson Cunniff stated Council had two particular questions with the program, specifically, what have other electric utilities done and what does the medical community think of the options? Mr. Smith stated the program in Longmont uses Option A with no income limitations. Xcel is developing a pilot program. Tucson Electric has a program with income limitations similar to Option B. There are several programs in California that cover air conditioning as well as heating. The programs in California are extending the first tier rate and removing the conservation incentive from the rate structure. As part of the community outreach, Utilities has talked to patient advocacy groups as well as physicians. They have been supportive of the program. A board member asked for clarification on the $12.50 per month discount with Option C. Mr. Smith stated there would be a $12.50 per month discount with the durable medical equipment. If the customer qualifies for the air conditioning component, they would receive a $41.73 per month discount during the three Summer months and the $12.50 discount the other nine months of the year. Discussion on the motion: A board member stated he would only support the option if it includes the income limitation. A board member asked for clarification on the appeals process. Mr. Smith stated there would not be an appeals process with the income limitations. From a medical perspective, an exception process would have to be developed that would involve input from a physician. Will customers sign up for the program on an annual basis? Yes. Vote on the motion: Yeas: Baumgarn, Behm, Cunniff, Kronkosky, Moore, O’Neill, Plate, and Rothe. Nays: none. The motion carried. On-Bill Utility Efficiency Financing Letter of Support (Attachments available upon request). Customer and Employee Relations Manager Patty Bigner introduced the item. The board members discussed their thoughts on the memo and what should be included. Vice Chairperson Rothe moved that the Energy Board recommend adoption of Option C with the income limitation. Board Member Moore seconded the motion. Vice Chairperson Rothe moved to approve the presented memo contingent on the Chairperson modifying the language consistent with comments made by the board members. Board Member Moore seconded the motion. Vote on the motion: Yeas: Baumgarn. Behm, Cunniff, Kronkosky. Moore. O’Neill. Plate, and Rothe. Nays: none. The motion carried. The Chairperson will revise the memo based on board member comments. Staff Reports Mr. Catanach gave an update on the Automated Metering Infrastructure (AMI) project. Approximately 2,000 meters have been deployed. Elster recently awarded Fort Collins Utilities two awards in the innovation and collaboration categories. Fort Collins Utilities is the first utility to win this type of award. Every two years, Utilities submits details to American Public Power Association (APPA) on how the operate in four categories: workforce development, safety, reliability, and planning. Two years ago, Utilities was awarded the platinum level based on the grading criteria (90.5 percent). This year. Utilities had to reapply and must achieve a level of 98 percent. Board Member Reports Economic Advisory Commission (Board Meniber O’Neill): Board Member O’Neill attended the meeting on March 21. This board felt that liaisons between boards are a good idea. Mayor Weitkunat was also present at the meeting and encouraged regular communication with Council. Air OualTh’ Board (Board Member Behm): Board Member Behm attended the meeting on March 19. The board was very receptive to members of the Energy Board attending this board. Legislative Update (Vice Chairperson Rothe,): Vice Chairperson Rothe gave an update on the Senate bill concerning protecting Colorado water from fracking. This bill missed the deadline for the Senate. This issue will be presented next year. Building Review Board (Board Member Moore): Board Member Moore planned on attending the March meeting; however, it was cancelled. She is planning on attending the April meeting. Natural Resources Advisory Board (Board Member Plate,): Board Member Plate attended the meeting on March 21. Carol Dollard, Energy Engineer with Colorado State University (CSU) gave a presentation on the energy awards presented to the university. Other Business Board Member Kronkosky noted that members of the Energy Board may be interested in attending CSU’s Earth Week Green Tour of the solar plant and biomass boiler located at the Foothills Campus. Adjournment The meeting was adjourned at 9:59 p.m. Submitted by Harriet Davis, Administrative Assistant, Fort Collins Utilities Approved by the Board on 2012 Signed Board Secretary Date Energy Board Meeting Minutes 11 April 5,2012