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HomeMy WebLinkAboutEnergy Board - Minutes - 08/07/2014Energy Board Meeting Minutes August 7, 2014 1 Fort Collins Utilities Energy Board Minutes Thursday, August 7, 2014 Energy Board Chairperson City Council Liaison Greg Behm, 226-6161 Ross Cunniff, 420-7398 Energy Board Vice Chairperson Staff Liaison Peter O’Neill, 288-4562 Steve Catanach, 416-2622 Roll Call Board Present Chairperson Greg Behm, Vice Chairperson Peter O’Neill, Board Members Nick Michell, Margaret Moore, John Graham, Stacey Baumgarn, Phil Friedman, and Peggy Plate. Board Absent Michael Doss Staff Present John Phelan, Lucinda Smith, Lisa Rosintoski, Lance Smith, Paul Sizemore, Cyril Vidergar, and Katherine Martinez Guests Fred Kirsch, Mark Houdashelt, Paul Davis (Platte River Power Authority) Meeting Convened Chairperson Behm called the meeting to order at 5:30 p.m. Public Comment There was no public comment. Approval of July 10, 2014 Minutes A board member requested the July 10 minutes be corrected to say “Clean Energy Collective (CEC)” on page 4 under the agenda item “Community Solar Garden Net Metering Rate Ordinance.” Board Member Phil Friedman requested the following addendum be added to the July 10 minutes: I was confused at the Thursday, July 10, 2014 Energy Board meeting regarding a potential conflict of interest that I might have had regarding the community solar farm. I thought I had a conflict because I have a PV system on my house. Rather, I believe the potential conflict might exist if I had subscribed to the community solar farm, which I did not. I miscued on this. During a conversation after the meeting, I realized that I did not need to abstain, since I had no conflict, real, or perceived. Had I not made this mistake I would have voted for the community solar farm motion. Board Member Baumgarn moved to approve the minutes of the July 10, 2014 meeting. Board Member Moore seconded the motion. Vote on the motion: It passed unanimously. Staff Reports  FC Moves Program Manager Paul Sizemore reported that the Aug. 26 City Council Work Session will be the second session for the Bicycle Master Plan before it is adopted. Also on the agenda are the Midtown in Motion transportation study for College Avenue, and the first Energy Board Meeting Minutes August 7, 2014 2 work session for the West Central Area Plan and detailed design for Prospect Avenue from Shields Avenue to College Avenue. Regarding bike projects, there is resurfacing on Shields Avenue to create buffered bike lanes (widen, stripe in a colored lane with cross hatching) that create space and have been shown to increase the bicyclists’ comfort. On Harmony Avenue, the green buffered bike lanes are prominent. East Prospect Avenue near I-25 contains the other buffered bike lane in Fort Collins.  A board member inquired whether some of these items, which are listed as Budgeting for Outcomes (BFO) offers, are already budgeted or are in process. Mr. Sizemore explained that some items are from the Transportation Master Plan. The BFO items that City Council will consider soon are for projects staff wants to implement in the budget cycle covering the next two years. Funding for buffered bike lanes may come from Building on Basics funding or funding for FC Bikes that was approved in the BFO process two years ago. The Midtown in Motion study had specific, dedicated funding, for example, and others projects are funded by allocations for bicycle plan implementation.  Energy Services Manager John Phelan reported that next Tuesday, August 12 will be the first City Council Work Session on the Climate Action Plan, focusing on the framework and schedule. Board Chairperson Greg Behm stated the board would postpone agenda item #6 because Strategic Financial Planning Manager Lance Smith was attending the Water Board Work Session and would arrive later. Energy Policy Discussion (Attachments available upon request) Peter O’Neill presented Version 9 of the draft Energy Policy and mentioned that it addresses privacy and security concerns, pollution, partnerships, and the changing utilities model, among other topics. Highlights from the discussion:  Board members discussed Version 9 (dated Aug. 4, 2014) of the draft Energy Policy. Board Vice Chairperson Peter O’Neill summarized his concerns about privacy of customer information and cyber security, and advocated for including language in the policy about these topics.  Other board members suggested that while privacy and security are important issues, the Energy Policy should not be bogged down and burdened with language addressing these, since city policies already ensure customer privacy and protection of customer information.  Mr. Phelan said cyber security was part of the Department of Energy grant used for the City’s Advanced Metering Infrastructure (AMI) project. He will ask the City’s Privacy and Security Committee for information about the City’s policies and practices for protecting customer information.  Assistant City Attorney Cyril Vidergar pointed out that the board should avoid including any language about privacy and security that would contradict existing City policies.  A board member commented that there are requirements on how you control access, and that the board should weigh in on how you control access to information and access to the network.  Mr. Phelan said an example on the water side would be if the City sees usage at a citizen’s home that indicates leaks. In a drought situation, if there are water wasting ordinances -- to prohibit wasting water or watering on the wrong days, for example – Utilities can take action and also notify people of major water break when they’re out of town. Energy Board Meeting Minutes August 7, 2014 3  A board member agreed on the need for customer privacy, system security, and stated that it’s perfectly reasonable to list these issues in the Energy Policy in a general way, and Council can decide whether to include them.  A board member said he believes the public will be vocal about privacy issues.  A board member agreed with this opinion, and stated the energy system is clearly going to need data and connections to operate, which leads to privacy issues.  Mr. Vidergar suggested that privacy and security language is not an appropriate part of the Energy Policy, because the City already addresses it in other policies. To include it would be to risk violating policies concerning red flag rules or the state’s Open Records Act. He said it’s good to acknowledge customer private data, but not include anything more specific in this document.  A board member inquired if the Energy Policy can reference other documents related to privacy and security.  Mr. Vidergar stated the City has privacy statements, which are on the website, and enhanced privacy, and that the board will recommend the Energy Policy to be approved by the City Council. The Council will be able to comment on issues before it approves the policy.  A board member stated that in 2014 for a city that has just installed 65,000 smart meters, he think it’s vital to address the issue of privacy and security because people want to know about their data and privacy today. He stated that he bets 75% of citizens won’t know what ‘opt in’ is. The question is how the City addresses privacy and security.  A board member stated that the topic isn’t static infrequent pieces of information that the City has dealt with in the past; this is real-time reporting on more technology devices, and that’s why something belongs in the Energy Policy. He suggested maybe in five years the City will need to addresses certain technologies and restrictions.  Mr. Phelan stated that the benchmark litmus test is whether it’s a benefit to customers in the system.  A board member stated he’d want the City to be able to analyze his energy usage data and suggest ways to improve efficiency.  A board member suggested that if an incident involves a water leak and could cause major damage to other residents’ properties, then City crews driving by in a truck wouldn’t ignore it. By the same token, the City should alert customers if data indicates a leak.  A board member asked whether board members would be comfortable with a contractor reviewing their energy usage data to provide bids. Other board members and staff indicated that this wouldn’t happen due to existing City policies.  Mr. Vidergar stated it’s appropriate for this board to make recommendations to Council on privacy and security rules, but he suggested including nothing more specific than a general reference so that it’s not inconsistent with City policies. He said he didn’t see any problem with Version 9 of the draft Energy Policy that the board is currently discussing.  A board member stated not knowing anything about the City’s privacy and security committee, and that maybe an explicit mention of it in the Energy Policy will help give citizens more assurance about opting in for the Wi-Fi thermostat; it might lead to a higher level of opting in.  A board member said if FortZED comes to fruition, then the City needs to address privacy and security concerns, and that one sentence in the Energy Policy should say something to the effect of, “This will be a major consideration.”  A board member noted that about 14 people commented on privacy and radio frequency concerns during a City Council meeting related to the City’s recent implementation of smart meters, known as Advanced Metering Infrastructure (AMI).  Mr. Phelan noted that the policy is missing a statement acknowledging availability of customer data and implications. Energy Board Meeting Minutes August 7, 2014 4  A board member reiterated that it’s unnecessary to mention privacy and security issues in the policy because it is already covered under the City’s policies. That language should exist outside the document, such as in a supporting document, and that the shorter the Energy Policy is, the better.  A board member commented that privacy language could draw attention away from the Energy Policy’s purpose of reducing greenhouse gas.  A board member pointed out the distinction between policy and plan: how you operate versus what you intend to do and that the board should focus on a higher-level discussion because customers agree to existing privacy policy when they begin service; “in the 21st century, this is what life is.”  Chairperson Behm noted that the board had discussed the issue for 45 minutes and took a straw poll by a show of hands to end the discussion for tonight. The vote was whether board members were in favor of including a privacy and security section in the Energy Policy. Five board members were in favor, three were opposed. Behm stated that the board will continue to work on it in the form of conducting research on what the City’s policy is and what the Privacy Committee is working on.  Board Member Nick Michell volunteered to research the City’s privacy policy. Mr. Vidergar stated he would put him in touch with the privacy committee’s director.  A board member stated he had hoped to discuss partnerships at the meeting, but hasn’t found statements related to this topic on the websites for Colorado State University (CSU) and Xcel Energy.  Mr. Phelan noted that the only partnership specified so far in the draft Energy Policy is Platte River Power Authority (PRPA).  A board member suggested stating simply that the board plans to pursue stronger partnerships, since the board doesn’t know what those partnerships will be.  Mr. Phelan suggested relating partner names to specific goals of the Energy Policy. FortZED is an example of public-private partnership. A board member agreed.  A board member inquired whether the Energy Policy should note why a partner is listed, such as for financial reasons, etc. Chairperson Behm asked for a volunteer to explore this issue. Board Member Plate volunteered.  Chairperson Behm stated that the board’s special meeting on August 25 will focus on the Energy Policy. He asked the board volunteers researching privacy and partnership information to have drafts of the research available at the meeting. Chairperson Behm stated the board would address the BFO agenda item and address the Building Appropriation Ordinance when appropriate staff arrived later. Budgeting for Outcomes (BFO) Discussion (Attachments available upon request) Environmental Services Director Lucinda Smith summarized the information on the spreadsheet of BFO offers provided in the meeting packet. The upper section listed Environmental included core offers along with enhancements, and items on municipal efficiency; the lower section listed Transportation offers that Mr. Sizemore identified. Ms. Smith stated that the Budget Lead Team (BLT) has been meeting for weeks and has finished most of its deliberations. She and board members discussed the timing of sending a memo to Council on its recommendations. A public open house on the budget is scheduled for September 4. Ms. Smith stated Council hasn’t determined which topics to address at which work sessions. She suggested the board send a memo to Council on Transportation and Environmental Health Energy Board Meeting Minutes August 7, 2014 5 recommendations before their work sessions. Mr. Sizemore discussed a possible strategy for the memo, such as listing the board’s top three issues and reasons for supporting them. Highlights of the Discussion  A board member stated that since the board has limited influence with Council, maybe it could help with those budget offers that are in danger of not getting approved if we support them.  Chairperson Behm commented that since there’s no motion to draft a memo, and the general consensus is leaning toward postponing a memo, the board would use the coming weeks to inform themselves on the issues to prepare for drafting the memo next month.  A board member agreed it would be a good idea to get a sense of what budget offers may be in danger of not getting approved.  A board member stated he went reviewed budget offers on the website about a month ago and it was difficult to decipher what some of them mean.  A board member asked for the definition of KFCG, which is stated in one of the budget offers: Keep Fort Collins Great.  A board member suggested staff highlight which budget offers the board should learn about in more detail.  A board member inquired about greenhouse gas goals, as an example, and which budget offers are of strategic importance that help meet those goals, such as the Community Solar Garden.  Mr. Phelan stated that some budget offers affect goals directly and some affect them indirectly. Items such as the Community Solar Garden are new funding to better meet community demand for those types of programs. Budget offer #59.2 Enhancement: Utilities Community Renewables is partially for grid alternatives and partially for funding solar rebates.  A board member inquired whether the draft budget forwarded to City Council from the Budget Lead Team will be funded. Ms. Smith stated that generally about 95% of that draft will be approved, based on prior years. Mr. Sizemore stated the City budget is so tight, Council – which will see items above the line to be funded and below the line to not be funded – will consider revisions but it would need to be balanced out. If you want something to be funded that’s below the line, they will ask you to suggest what to cut from above the line.  A board member commented that board members need to note the funding source for each offer. The General Fund is really tight, and the KFCG special tax has specific purposes. In the budget group he attended, Offer #118.22 (Compressed Natural Gas Fuel Site: $500,000) was below the line but they said in a memo they hope the BLT can find funding for it. The City has only one fuel site for all Transfort buses, which risks bringing all bus service to a halt if something happens to that site.  Mr. Phelan noted that it’s the same situation with utility Enterprise Funds. We can’t fund water projects with Light &Power funds, for example.  A board member inquired whether staff knows where the line is now. The answer is no.  A board member inquired about budget offer #47.13 Municipal Energy Efficiency Fund (General Fund) and #47.17 Municipal Energy Efficiency Fund (Utilities), which appear to be the same. Ms. Smith explained they’re the same, except for the funding sources.  A board member stated he was glad to see budget offers supporting pedestrians. Mr. Sizemore replied that Building On Basics (BOB) expires in 2015, and voters will have a chance to vote for a BOB II, which would fund more pedestrian infrastructure projects.  A board member inquired about the need for additional parking at Harmony Transfer Center, because they run out of spots for airport shuttle parking. Mr. Sizemore stated the Energy Board Meeting Minutes August 7, 2014 6 City does area plans on a broad range of issues, and on sustainability initiatives could go into neighborhood for a pilot program for a high level of engagement, almost like ClimateWise for neighborhoods.  A board member inquired about Item# 58.2 Utilities Demand Response. Mr. Phelan stated it helps to roll out the program and expand it next year if new customers want smart meters as part of the Advanced Metering Infrastructure. Building Appropriation Ordinance (Attachments available upon request) Strategic Financial Planning Manager Lance Smith presented two documents: (1) a summary of “First Reading of Ordinance Appropriating Capital Project Funding in the Light and Power, Water, Wastewater, and Storm Drainage Funds for the Construction of a New Utilities Administration Building in Block 32 on Mason Street and a Renovation of 700 Wood Street” and (2) a PowerPoint on “Financing a New Utility Administrative Building and Remodeling Wood Street.” He recommended that the board consider providing meeting minutes to City Council ahead of the August 19 Council first reading of the Appropriation Ordinance on the board’s discussion and any recommendations. Highlights from the discussion:  The existing Customer Service Center (CSC) at 117 N. Mason, which is owned by the City’s General Fund, not the utility Enterprise Funds, has inadequate parking for customers and is an old building with poor lighting, security and layout.  The Utilities Service Center (USC) on Wood Street is one of the City’s most energy in- efficient buildings and requires significant upgrades: HVAC, windows, skylights, external sealing. It also has not met fundamental space needs for many years. The operations and crew space is limited, in poor condition, and features only single gender capacity (Utilities hired its first female line-crew employee a few years ago and doesn’t have adequate facilities). Estimate of additional space needed is 24,000 square feet (s.f.). Increased security requirements post 9/11 are difficult to meet with public access to the building, and long-term plans will eventually require the operations center to be more centrally located rather than on the north end of the city.  The 700 Wood Street building will cost $9.3 million to renovate.  The Appropriation Ordinance will provide funding toward the construction of a new Utility Administration Building on Mason Street as well as renovation of the antiquated Utility Service Center on Wood Street. Total combined project costs are $23,411,000 with $4.5 million already appropriated from Light & Power reserves resulting in the appropriation request being $18,911,000. The four Utility Funds (Light & Power, Water, Wastewater, and Stormwater) will share the project costs. All appropriations will come from available reserves in these funds.  The new Utility Administration Building will look similar to 215 N. Mason but will be larger and more energy efficient, and will feature 37,500 s.f., three stories, and dedicated parking. The cost will be $14.1 million.  Sustainability Services will lease space from Utilities. Utilities will eventually need that space.  A photovoltaic (PV) system on the roof will generate enough solar energy to make the building net-zero.  A board member inquired about the cost per square foot of the new building compared to the cost of the building at 215 North Mason, and staff said they could research this information Energy Board Meeting Minutes August 7, 2014 7 after calculating for inflation to compare it to the cost of the 215 N. Mason building, which is about 14 years old.  A board member inquired about the total city budget; staff estimated it is approximately $500 million. Utilities revenue is approximately $200 million.  A board member inquired whether funding of this project will increase his electric bill.  Mr. Smith explained it will not drive rate increases directly. It may accelerate rate increases indirectly by a year or two or three.  Instead of revamping the interior of the Utility Service Center to an open style at a cost of $2.3 million, the funds being requested will focus on renovating the exterior.  Mr. Phelan noted that Utilities has no choice but to do something because the building is so antiquated; the HVAC system is at the end of its life. When the boiler went out last winter, some employees were working in 50-degree offices.  A board member commented that when you consider the years of use, we’re getting our money’s worth. A small percentage of the annual budget buys us 50 years of effective operating space by renovating the 700 Wood Street building. He said he’d support the ordinance on that basis.  A board member commented that increased energy efficiency will result in significant cost savings.  Mr. Smith commented that operating expenses for Wood Street are $200,000 to $300,000 per year. The building is 115,000 s.f. and staff is looking for another 20 years out of that building.  A board member inquired whether staff considered a new space that would last 50 years.  Mr. Smith replied that the building committee did. The two separate buildings are needed because most people who park in the 700 Wood parking lot are not working in the offices; they’re field crews who need space to park their equipment and vehicles.  A board member inquired whether Utilities employees separated into two buildings would pose any problems.  Mr. Phelan stated that Utilities currently has two buildings and multiple plants. The 117 N. Mason Street building (containing the board room) would shut down and staff would move to the new building that will be Gold or Platinum LEED-certified.  Mr. Smith said the City Council’s first reading of this ordinance will be on August 19, and the second reading and adoption would be on September 2. Chairperson Behm moved that the Energy Board recommend to City Council approval of the Utility Buildings Appropriation Ordinance scheduled for City Council First Reading on August 19, 2014 appropriating capital project funding from the Light & Power, Water, Wastewater, and Stormwater Funds, for construction of a new Utilities Administration Building at the corner of Laporte and Howes and renovation of 700 Wood Street. Board Member Moore seconded the motion. Vote on the motion: it passed unanimously Board Member Reports Board Member John Graham stated the City and Clean Energy Collective (CEC) have agreed on leasing language for the land that will contain the community solar garden. Mr. Phelan added that the CEC has formally submitted its plan to the Development Review process. Board Member Moore stated she will update board members on discussions of the Climate Action Committee (CAC) at the next board meeting.