HomeMy WebLinkAboutMemo - Read Before Packet - 11/6/2018 - Memorandum From Phil Ladd, John Phelan Re: Read Before - Agenda Item #16 - Clarification On Energy /Cap Offers In The BudgetEnvironmental Services
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Fort Collins, CO 80522
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MEMORANDUM
Date: November 6, 2018
To: Mayor and City Council
From: Phil Ladd, Utilities Finance Manager
John Phelan, Energy Services Senior Manager
Thru: Darin Atteberry, City Manager
CAP Executive Team1
Re: Read Before: Agenda Item 16 - Clarification on Energy/CAP Offers in Budget
Purpose:
The purpose of this memo is to respond to questions raised at Leadership Planning Team on November
5, 2018:
provide a list of all Climate Action Plan offers and indicate the source of funds, identify which
offers are being funded by the proposed rate increase, and which are currently below the line.
consider demand charge revenue to fund additional transformer purchases if needed due to
reduction of 8.7 (Capital Replacement - Utilities: Light & Power - Electric Distribution Transformer
Replacement).
Bottom Line:
CAP-related offers that are included in the budget recommended for Council consideration on
November 6, 2018 include energy efficiency, demand response and solar rebate programs.
Two of the budget offers added for consideration at Council’s request are proposed for funding at
25% of their original requested amount;
o 9.90 (Utilities Enhancement - Energy Efficiency), now proposed for $237,500/yr
o 9.92 (Utilities Enhancement – Non-Residential Solar Rebates, now proposed for
$125,000/yr
The funding for these two offers uses 0.3% of the proposed 5.0% Utilities rate increase. If
approved, the 5% Utilities rate increase in 2019 will also fund these two offers in 2020.
With all the offers recommended for funding, the 2020 CAP inventory is forecast to be 20.4%
below baseline, just over the target of 20%. This includes the impacts of funding Ongoing offers,
the 25% scaled enhancement offers for energy efficiency and solar rebates, and Platte River’s
completion of the 20 MW solar project in 2019. The CAP offers are listed in Table 2 on page 2.
Most of the population of aging distribution transformers serve residential customers. The
majority of residential customers are not currently subject to demand charges, therefore, funding
for additional transformers replacement would need to come from other electric revenue sources.
Background:
To add Utilities offers 9.90 and 9.92 at 25% of their original requested amount, three other Utilities offers
are proposed for reduction, as summarized in Table 1 below. A Council memo from October 25, 2018
(Councilmember requests and questions about the 2019-2020 City Manager’s Recommended Budget –
Part 7) discussed rationale for this recommendation. Note that the reduction in 2019 of offer 9.82 is not a
1 Includes Deputy City Manager Jeff Mihelich; Utilities Executive Director Kevin Gertig; Chief Financial Officer Mike
Beckstead; Director of Planning, Development, and Transportation Laurie Kadrich; Chief Sustainability Officer
Jackie Kozak Thiel; and Environmental Services Director Lucinda Smith
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reduction in services or purchases, but simply reflects a delay in several SPE solar projects which will not
be completed until around mid-year 2019.
Table 1 – Energy offers added to budget at Council suggestion
Budget Offers 2019 2020
Additions based on Council direction
Offer 9.90 – Utilities enhancement – Energy Efficiency $238k $238k
Offer 9.92 – Utilities enhancement – Non-Residential Solar Rebates $125k $125k
Budget Offset Reductions
Offer 9.82 – Core Renewable Energy ($140k)
Offer 8.17 – New Feeder Capacity – Circuit 576B ($458k)
Offer 8.7 – Distribution Transformer Replacements ($223k) $95k
Net Impact $0k $0k
Table 2 below provides a summary of CAP-related offers and their status in the budget recommended for
Council consideration on November 6, 2016.
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Table 2 – Climate Action Plan offer status
CC: Lance Smith, Utilities Strategic Financial Director
Lisa Rosintoski, Utilities Deputy Director
Lindsay Ex, Interim Director, Environmental Services
Recommendation Offer # Name 2019 2020 Funding Source
Funded 9.80 Light and Power Energy Services $ 4,394,748 $ 4,439,633 Light and Power
Funded 9.81 Residential Solar Rrbates $ 500,000 $ 500,000 Light and Power
Funded 9.82 Core Renewable Energy $ 3,428,300 $ 3,671,500 Light and Power
Funded 9.83 Utilities - Demand Response $ 629,460 $ 638,663 Light and Power
Funded 43.10 Road to Zero Waste Plan Update (KFCG) $ 15,000 $ 15,000 General Fund
Funded 43.12 2030 Climate Action and Energy Policy Update
–Optimizing Policy, Targets & Strategies
$ 40,000 $ 80,000 Split GF/L&P
Funded 45.11 Electric Bus Pilot $ 880,000 $ - Transit Svc/GF
Funded 9.73 Bio Gas to CoGen $ 800,000 $ - Wastewater
Funded 43.6 Municipal Electric Lawn and Garden Equipment Fund $ 20,000 $ 20,000 One Time GF
Optional rate
increase
9.90 Utilities: Light & Power - Energy Efficiency $ 237,500 $ 237,500 Light and Power
Optional rate
increase
9.92 Utilities: Light & Power - Non-Residential Solar
Rebates
$ 125,000 $ 125,000 Light and Power
Unfunded 6.7 Hampshire Low-stress Bikeway (KFCG) $ 300,000 $ 300,000
Unfunded 6.11 Transportation Options Plan and Program $ 150,000 $ 100,000
Unfunded 7.2 1.0 FTE Contractual - Plans Examiner - Expedited
Plan Review for Green Building
$ 93,560 $ 91,260
Unfunded 8.22 Utilities: Light & Power - Arterial & Collector Street
LED Streetlight Conversion
$ 1,115,000 $ 572,000
Unfunded 9.91 Utilities: Light & Power - Cold Weather Pump
Demonstration
$ 150,000 $ 150,000
Unfunded 9.93 Utilities: Light & Power - Solar Power Purchase
Program (SP3)
$ - $ 200,000
Unfunded 9.94 Utilities: Light & Power - Bring Your Own
Thermostat (BYOT)
$ 30,000 $ 30,000
Unfunded 9.95 Utilities: Light & Power - Battery Storage
Demonstration
$ 100,000 $ 100,000
Unfunded 9.96 1.0 FTE Contractual to Classified - Energy Code
Compliance Specialist
$ 4,269 $ 4,397
Unfunded 43.11 Road to Zero Waste Enhanced Outreach (KFCG) $ 30,000 $ 30,000
Unfunded 43.3 Innovate Fort Collins Challenge Fund (KFCG) $ 210,000 $ 210,000
Unfunded 43.4 Expanded Municipal Sustainability Innovation Fund
(KFCG)
$ 50,000 $ 50,000
Unfunded 43.8 1.0 FTE Conversion from Contractual to Classified -
Green Building Program Coordinator
$ 5,500 $ 5,500
Unfunded 57.3 1.0 FTE Forestry Specialist and Forestry Emerald
Ash Borer Pre-Infestation
$ 289,050 $ 412,419
Unfunded 58.12 Theatrical LED Lighting $ 538,715
Unfunded 92.1 Municipal Renewable Energy Fund $ 100,000 $ 100,000
Unfunded 92.2 Municipal Energy Efficiency Fund $ 75,000 $ 75,000
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