HomeMy WebLinkAbout2003-038-03/25/2003-APPROVING AND ADOPTING THE ELECTRIC ENERGY SUPPLY POLICY RESOLUTION 2003-03 8
OF THE COUNCIL OF THE CITY OF FORT COLLINS
APPROVING AND ADOPTING THE
ELECTRIC ENERGY SUPPLY POLICY
WHEREAS, in December 2001,the City Council requested that City staff draft an Electric
Energy Supply Policy addressing electric rates, electric reliability, demand side management and
wind power,to be presented to the Electric Board and then to the Council for review and approval;
and
WHEREAS, City staff has prepared the Electric Energy Supply Policy, a copy of which is
attached hereto as Exhibit"A" and incorporated herein by this reference (the "Policy"); and
WHEREAS,the primary objectives of the Policy are to: (1)maintain high system reliability;
(2)maintain competitive electric;and(3)reduce the environmental impact of electric generation and
consumption through energy efficiency and increased use of renewable energy; and
WHEREAS, on November 18, 2002, the Electric Board considered the Policy and
recommended that the City Council approve and adopt the Policy; and
WHEREAS,on November 26,2002,the Air Quality Advisory Board considered the Policy
and recommended that the City Council approve and adopt the Policy; and
WHEREAS, on January 8, 2003, the Natural Resources Advisory Board considered the
Policy and recommended that the City Council approve and adopt the Policy; and
NOW,THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF FORT
COLLINS that the Electric Energy Supply Policy is hereby approved and adopted.
Passed and adopted at an adjourned meeting of the City Council held this 25th day of March,
A.D. 2003. --
Mayor
ATTEST:
L' 10 A L
City Clerk
City of Fort Collins
Electric Energy Supply Policy
March 25 , 2003
Introduction
Motivated by their concern for the welfare of the community , the citizens of Fort
Collins created the electric utility in 1935 . During the years that followed , the electric
system grew both in size and sophistication . In 1973 , Fort Collins joined with Estes Park,
Longmont and Loveland to create the Platte River Power Authority ( PRPA ) , a joint action
agency charged with meeting the electric generation and transmission needs of the four
cities .
The City now has a state of the art electric system that provides citizens with
highly reliable service at an affordable and competitive price . However , getting to this
point did not happen without a lot of effort and thoughtful guidance . The future will be no
different . There will be many challenges to overcome if the city is to continue to provide
its citizens with a high level of service . The most significant of these challenges will be
addressing both important environmental issues and increasing demand , while maintaining
high system reliability and competitive pricing . The purpose of this policy is to provide
strategic objectives regarding system reliability , rates and the environment to guide the
electric utility into the future as it continues to provide the citizens of Fort Collins with
reliable and competitively priced electric service , in partnership with PRPA .
System Reliability
System reliability is the core of providing electric service . It is critical for the
welfare of the community . It should not be compromised . The Utilities must continue to
provide businesses and residents with highly reliable electric service consistent with
established reliability goals .
Objectives for the Future
1 . Continue to design , build and maintain the electric system utilizing the high
standards that have been developed .
2 . Maintain an emphasis on system safety for the benefit of employees and
citizens .
3 . Complete the electric system undergrounding program by the end of 2004 .
4 . Reduce peak electric use in order to minimize overloading of the electric system .
5 . Encourage Platte River Power Authority to design , operate and maintain their
electric transmission and generation system to minimize the risk of system
outages .
6 . Encourage Platte River Power Authority to maintain a diverse source of electric
generation capacity .
7 . Investigate the merits of distributed generation as a method of reducing system
peak demands .
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Electric Rates
For many years the citizens of Fort Collins have benefited from low electric rates .
During the past 18 years , there have been two electric rate increases and two electric rate
decreases . Electric rates today are only 0 . 2 percent more than they were in 1983 , while
the consumer price index has increased 77 . 8 % . The City ' s residential electric rates are
lower than 88 % of the 51 Colorado utilities surveyed by the Colorado Association of
Municipal Utilities .
In order for the City to continue being a viable provider of electric service , it will be
essential to maintain competitive rates in the future .
Objectives for the Future
1 . Continue to design and implement electric rates that allocate costs between
customer classifications in an equitable manner .
2 . Design and implement electric rates that encourage conservation ( e . g . market
based incentives , block pricing ) and demand side management .
3 . Maintain rates that are regionally competitive and are below Xcel Energy .
4 . Maintain long -term rate stability .
5 . Establish alternative cost based rate structures that reflect the community ' s
interest in and benefit from renewable energy ( green pricing , net metering ,
system benefit charges ) .
6 . Increase productivity and efficiency throughout the Utilities .
7 . Work with Platte River Power Authority to delay or mitigate the expected rate
impact associated with the construction of new base load generation facilities .
8 . Work with Platte River Power Authority to develop a process whereby the
avoided generation capacity costs , associated with demand side management
( DSM ) programs developed by the City , can be passed along to the City .
The Environment
Fort Collins 2000 Greenhouse Gas Audit
There is a growing awareness of 2.04 million tons Coe
and concern about global climate change solid
and the harmful contributing effects of Natural waste
Gas (
greenhouse gases . In 1999 , the Fort 20 % 1 %
Collins City Council adopted a local ^�� Electricity ='
action plan to reduce greenhouse gas 44%
emissions . In the City ' s 2000 Climate
Protection Status Report , the use of
electricity , generated from facilities Transport35%
fueled with either coal or natural gas ,
was identified as the largest contributor
of carbon dioxide ( CO2 ) to the environment . Although there are new and evolving
technologies to reduce fossil fuel pollutants such as sulfur dioxide and nitrogen oxides E
( NOx ) emissions , there are presently no feasible methods of reducing CO2 emissions at the
generating facility . However , CO2 emissions could be reduced by decreasing the
consumption of electricity generated with CO2 producing fuels and /or generating electricity
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with energy sources that do not produce CO2 , such as wind , solar , and water . Decreasing
consumption and using these energy sources would also reduce the negative
environmental impacts ( e . g . habitat destruction , air and water pollution ) associated with
fossil fuel exploration , mining and transportation .
Objectives for the Future
1 . Reduce per capita electric consumption 10 % , from the baseline of 2002 , by the
year 2012 . The10 % per capita consumption reduction target will reduce overall
electric consumption approximately 17 % by 2012 ( see the following graph ) .
During this time period ( 2002 - 2012 ) , the overall reduction in electric
consumption amounts to approximately 1 . 7 billion kilowatt - hours of electricity
and the avoided production of over 1 . 8 million tons of COz .
Energy Consumption Policy Target, 10% Per Capita Reduction
13 , 000
11 , 000
w ,c 9 ,000
10% Decrease
7 ,000 in 2012
U Q j
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a c 5 ,000 - -
Ii o =4- Base Case
c U
C 3 , 000 Policy ~-- - - -
Q Target
1 , 000 —
00 O N � O CO O N V CD 00 O N V
Co Q) D) O) 0) O O O O O O r- r
M O O O O d) O O O O O O O O
N N N N N N N N
Year
2 . Reduce per capita peak day electric demand 15 % , from the baseline of 2002 , by
the year 2012 . The 15 % per capita demand reduction target will reduce the
peak demand by approximately 80 MW by 2012 ( see the following graph ) .
This projected reduction in peak day demand is approximately equal to the
output of one combustion turbine , which presently costs about $ 25 million .
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Peak Demand Policy Target, 15% Per Capita Reduction
2 . 5
Y
"a
C
� 2 . 0
1 . 5 15% Decrease
a. in 2012
'ii 1 . 0
R U Historical Data Proiected Data
m
-+- Base Case
0 . 5 Policy
Target
c
Q0 . 0 -- - - - - - --- -- --- ----------- - ---------
00 O N NT CO 00 O N V (D 00 O N �
00 6) M G) d7 0) O O O O O f
O) 0) O O Q) O O O O O O O O O
N N N N N
Year
3 . Develop and implement effective demand side management ( DSM ) programs .
4 . Develop a strategic plan by July 1 , 2003 for reaching the consumption and
demand reduction targets outlined in this policy . The approaches to be
evaluated will include , without limitation , a systems benefit charge , efficiency
programs , incentive programs , educational programs , revolving loan programs
and innovative rate structures .
5 . Increase community awareness and understanding of DSM and renewable
energy programs .
6 . Encourage Platte River Power Authority to continue reducing emissions from
fossil fuels and to avoid the use of coal in any new generation facilities
( Rawhide Unit 2 or other potential generation facilities that PRPA may pursue ) .
7 . Work with Platte River Power Authority to continue to diversify the portfolio of
energy sources that serve the City .
8 . Work with Platte River Power Authority to increase the City ' s percentage of
renewable energy ( in addition to the existing large hydro from WAPA ) to 2 % by
the end of 2004 and to 15 % by the year 2017 .
9 . Develop and implement policies and programs that support :
• the development and use of renewable resources ,
• sustainable practices ,
• the City ' s effort to reduce global warming , and
• the design and construction of energy efficient buildings
10 . Develop and implement policies that require the use of energy efficient design
principles in the renovation and construction of all City facilities .
11 . Whenever possible , integrate efforts related to energy efficiency , renewable
resources , green buildings ( energy code ) , sustainable practices and education .
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Annual Report
On an annual basis , the City Manager will provide the City Council and the Electric
Board with a status report on the objectives included in the Electric Energy Supply Policy .
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