HomeMy WebLinkAbout2013-09-18 Min - Board REGULAR MEETING
September 18, 2013
In accordance with District Code Section 2.08.010, the TDPUD minutes are action only
minutes. All Board meetings are recorded on a digital format which is preserved in
perpetuity and made available for listening to any interested party upon their request.
The regular meeting of the Board of Directors of the Truckee Donner Public Utility District
was called to order at 6:00 PM in the TDPUD Board room by President Bender.
ROLL CALL: Directors Joe Aguera, Jeff Bender, Ron Hemig, and Tony Laliotis were present.
Director Bob Ellis, absent.
PLEDGE OF ALLEGIANCE
Director Laliotis led the Board and public in the Pledge of Allegiance.
EMPLOYEES PRESENT Brian Wright, Bob Mescher, Stephen Hollabaugh, Steven Poncelet,
Peter Rosales, Ian Fitzgerald, Michael Holley, and Barbara Cahill
CONSULTANTS PRESENT Steve Gross
OTHERS PRESENT Juanita Schneider and Jody Sweet
CHANGES TO THE AGENDA
General Manager Holley asked to remove agenda item No. 7, Consideration of the Purchase
of a Virtual Desktop System, and switch the order of the workshop items No. 12 and 13.
PUBLIC INPUT
Jody Sweet thanked Jim Wilson and Steve Hollabaugh for removing the tree at the Veterans
Hall. The Vets really appreciate this timely effort.
DIRECTOR UPDATE
Director Hemig stated that he cannot attend the Saturday Neighborhood Block party. Both
Directors Aguera and Laliotis said they would attend.
CONSENT AGENDA
CONSIDERATION OF THE PURCHASE OF A VIRTUAL DESKTOP SYSTEM The item involves
virtualization of District staff desktop computers.
Removed from agenda.
CONSIDERATION OF THE PURCHASE OF SECURITY CAMERAS The item involves
video and audio surveillance of District Offices at 11570 Donner Pass Road.
1 Minutes: Sept 18, 2013
CONSIDERATION OF THE PURCHASE OF NETWORK SWITCHES FOR THE WATER
SCADA RELIABILITY PROJECT This item involves the purchase of Cisco switches to
allow for Water SCADA RTU network connection.
CONSIDERATION OF THE EXTENSION OF A CONTRACT FOR THE 2013 FINANCIAL
AUDIT This item involves the extension of Moss Adams for the 2013 financial audit.
Director Hemig moved, and Director Laliotis seconded, that the Board approve the consent
calendar minus item No. 7 (Consideration of the Purchase of a Virtual Desktop System).
ROLL CALL: Director Ellis, absent, all other Directors aye, by voice vote. SO MOVED
BUDGET
FY14 AND FY15 BUDGET: PURCHASE POWER PLAN
Stephen Hollabaugh gave a presentation:
• Mission Statement of Truckee Donner PUD
o "The Mission of Truckee Donner Public Utility District is to provide reliable and high
quality water and electrical power services while meeting customer demand, and to
manage District resources in a safe open, responsible, environmentally sound manner
at the lowest practical cost."
• Renewable Portfolio Standard
o At such time that projected resources do not exceed projected demand, TDPUD will
strive to include qualifying resources to meet projected demand
o Truckee Donner Public Utility District resource mix will have a minimum of 33% of
renewable resources by 2020
• Conservation is Considered First Resource
o Forecast assumes that load increases by only 1% annually in 2014 and remains flat in
2015
o Conservation is expected to reduce 1-3% of total load
— Offsets growth that would otherwise require additional resources
— Greater conservation will reduce market purchases
• History and Future Forecasted Load (GWh)
0 2008 Actual Load = 160,189 2013 Forecasted Load = 163,082
0 2009 Actual Load = 157,695 2014 Forecasted Load = 164,173
0 2010 Actual Load = 158,494 2015 Forecasted Load = 164,729
0 2011 Actual Load = 160,544
0 2012 Actual Load = 156,497
170,000
165,000
160,000
G 155,000 —
W 150,000 -*-Forecast Load GWh
h 145,000 -
140,000 Actual Load GWh
135,000
130,000
125,000
120,000-
CPS CP° CPy CPe CP1 CPO CP9 010 011 O~ry Otis 01Q 01y
2 Minutes: Sept 18, 2013
• Future Portofilio (Risk vs. Benefit)
o Future portfolio (FY14& FYI and beyond) is intended to balance:
— Conservation
— Renewable Resources
— Cost/Rates
— Resource Diversity
— Contract Duration
— Price Volatility
• Existing Resources
o Existing (FY13) renewable resources are:
— Stampede Dam — Small hydro
— Western CVP — Large hydro (sold into NCPA Pool)
— Murray City— Landfill gas
— UAMPS Pleasant Valley —Wind
— Horse Butte Wind Project UAMPS —Wind
o FY14 & FYI includes no new renewable resources:
— No purchase of unbundled REC's
o FYI Possible new renewable resources are:
— Waste Heat generation from Kern River natural gas compressor station
(Veyo station, carbon free)
• Proposed Resource Portfolio - FY14
f
UAMPS Pool
Payson- Nat Gas 3.3%
11.9%
ind P
'0
�� Wln
' t;andfill Gas:-
t
Murray:
12.3%
Fallon Exchange
2.7%
3 Minutes: Sept 18, 2013
l"
• Proposed Resource Portfolio — FY15
UAMPS Pool
Payson- Nat Gas 3.3%
11.9%
Wind-PPM 0.4%
I.aridflll Gas=
Mutray ,
12.3S0 vll
• Renewable Portfolio Standard (RPS)
o RPS is calculated by the following equation:
• Eligible Renewables MWh / Retail Sales MWh
o Definition of Retail Sales
o "Sales of electricity by a POU to end-use customers and their tenants, measured in
MWh. This does not include energy consumption by a POU, electricity used by a POU
for water pumping, or electricity produced for onsite consumption (self-generation)."
o Will discuss in next presentation tonight
• CARB Cap and Trade
o Auction proceeds and allowance value obtained by the electric distribution utility shall
be used exclusively for the benefit of retail ratepayers of each electrical distribution
utility, consistent with the goals AB32, and may not be used for the benefit of entities
or persons other than such ratepayers.
o Settlement price ($/allowance) $10.09 (auction 1), $13.62 (auction 2), $14.00 (auction
3), $12.22 (auction 4)
o Revenue from sale of allowances consigned by TDPUD
— $242,160 (auction 1)
— $204,300 (auction 2)
— $210,000 (auction 3)
206 102 (auction 4)
$862,662 TOTAL
To be used in 2014
4 Minutes: Sept 18, 2013
r Energy Supply Costs
o The all-in budgeted energy supply cost excluding transmission and scheduling costs
are:
YEAR $/MWH
FY12 (BUDGET) 66.4
FY12(ACTUAL) 65.1
FY13(PROJECTION) 66.6
FYI(FORECAST) 67.7
FY15(FORECAST) 68.4
• Purchase Power Plan Expenditure Detail—Budget FY13 vs. FY14
2013 TO
BUDGET BUDGET 2014
2013 2014 $ BUDGET
Purchased Power and Resource Costs 1 1 CHANGE
TOTAL ENERGY SUPPLY-VARIOUS $10,918,075$11,191,445 $273,370
$66.95 $67.95
TRANSMISSION-NVENE.RGY $1,081,033 $1,204,628 $123,595
SCHEDULING-NCPA $73,226 $75,423 $2,197
WAPA COST/(CREDIT)TOWARD
MWH'S ($28,012) ($28,012) $0
TOTAL BULK POWER COSTS $12,044,322 $12,443,484 $399,162
3.2%
TOTAL ANNUAL MWH 163,082 164,713 1,631
1.00%
TOTAL DELIVERED COST$/MWH $73.85 $75.55 $1.69
2.24%
5 Minutes: Sept 18,2013
f Purchase Power Plan Expenditure Detail — Budget FY14 vs. FYI
2014 TO
BUDGET BUDGET 2015
2014 2015 $ BUDGET
Purchased Power and Resource Costs CHANGE
TOTAL ENERGY SUPPLY - VARIOUS $11,191,445 $11,331,030 $139,584
$67.95 $68.79
TRANSMISSION - NVENERGY $1,204,628 $1,216,674 $12,046
SCHEDULING - NCPA $75,423 $75,423 $0
WAPA COST/(CREDIT) TOWARD
MWH'S ($28,012) ($28,012) $0
TOTAL BULK POWER COSTS $12,443,484 $12,595,115 $151,630
1.2%
TOTAL ANNUAL MWH 164,713 164,729 17
0.01%
TOTAL DELIVERED COST $/MWH $75.55 $76.46 $0.91
f
1.19%
• Resource Plan:
o Achieves a projected FY14 all-in cost in the range of$75.55/MWh
o Achieves a projected FY15 all-in cost in the range of $76.46/MWh
o Minimizes price volatility due to fuel costs and weather risk
There was no public input.
Board discussion:
• Does the Kern River project have anything to do with the Payson Project? How can an
isolated place turn out to be a benefit for us?
• What is in the market mix?
• What is the status of the lawsuits for the Cap & Trade? Could it change significantly?
Could it take some allocations away?\
• Power costs will be offset by AB32
• Figures look good and steady
• Get nervous with carb money
• Cannot remember the decision on the policy as to how to use AB32 funds. Did we
consider putting money toward rate stabilization? The Board can make a different
finding in 2016.
• Kern River project (waste heat) will run 24/7 as the pipeline is always pumping natural
gas.
r • Would UAMPS put another project together, other than just another power plant?
• The 5 year market purchase ends in 2017, so we have 3-1/2 years to replace it.
• Report looks fine
6 Minutes: Sept 18, 2013
WORKSHOP
DISCUSS CEC CHANGES TO THE RENEWABLE PORTFOLIO STANDARD (RPS)
DEFINITION This item involves CEC changes to the RPS definition.
Stephen Hollabaugh gave a presentation:
• 2002, original RPS adopted and required 20% of generation be sourced from renewable
resources by 2017
o SB 1078
o Local publically owned utilities (POU's) are exempt from RPS requirements but must
develop their own RPS policies
• 2006 requirement accelerated to 20% by 2010
o SB 107
• 2011, State's RPS sets requirements applicable to POU's and required 33% by 2020
o SB 1x2
o Development of the CEC's PUD enforcement regulations started in 2011 after
passage of SB 1 x2
• Board approved TDPUD's first RPS in 2004
o Board defined qualifying resources as non-fossil fuel generation including all
hydroelectric resources
• March 2007 Board replaced and updated RPS and set a minimum target of 21%
renewables by 2010
o Qualifying resources included all hydroelectric resources
o RPS calculated by total qualified resources divided by total MWh purchased that year
— Total MWh purchased that year included transmission and distribution losses
• December 2011 Board updated RPS
o Included CEC definition of eligible renewable resources
o RPS included eligible renewables including renewable energy credits (REC's)
— This was the first time total MWh's sold to end-use customers was used in the
calculation
• 2011, Board also approved RPS Enforcement Program that included an annual review of
RPS Procurement Plan
• 2004 thru the present, CEC Guidebook for RPS Eligibility continued to change
• POU enforcement regulations started in 2011 and regulations will become effective on
October 1, 2013
• RPS enforcement regulations for the first time define for a specific purpose the term
"Retail Sales"
o "Sale of electricity by a POU to end-use-customers and their tenants, measured in
MWh. This does not include energy consumption by a POU, electricity used by a POU
for water pumping, or electricityproduced for onsite consumption (self-generation)."
• TDPUD's Renewable Energy Resources Procurement Plan will need to be updated and
revised
• These Changes to include:
o Retail Sales definition; all retail sales less own use and water pumping
o Procurement targets (section 3)
o Carryover language for REC's
o Reporting language (section 11)
7 Minutes: Sept 18, 2013
o Prior calculation methods
• Correctly used when originally implemented
• Includes
o "Old RPS% Board Defined" — MWh of Board defined renewables that included large
hydro divided by all retail sales
o "Current RPS%" — MWh of all eligible renewables divided by all retail sales
o "New RPS%" — MWh of eligible renewables divided by CEC defined retail sales
Changing RPS Definition by CEC
i
I
TDPUD Use+ CEC Definition of Sales Old RPS% RPS % 1 RPS % j
Year Retail Sales(MWh) Water Pumping Retail Sales(MWh) ; Board Defined j Current New
2012 j 146,014 8,883 137,132 39.4% 42.0% �
2011 1 149,978 I 8,340 141,638 133.0% 35.0% j
2010 1 147,647 9,402 138,244 ( 22.3% j 23.8%
2009 I 146,875 j 10,539 136,336 1 34.2% 127.7% ( 29.8%
2008 148,305 ; 11,003 137,302 1 24.4% 1 17.2% 18.6% I
2007 1 147,091 i 12,107 134,984 j 8.9% 1 0.4% 0.4%
2006 1 144,269 1 11,772 132,497 ( 20.7% j 1
2005 I 136,339 11,491 124,848 j 9.9%
2004I 135,2531 12,261 122,992 0.05% I
There was no public input.
Board discussion:
• The portion the PUD consumes- does this take away from the percent to regulation?
Or does it just affect retail sales?
• How does this new calculation figure with the powers to be?
• Why does the CEC do all this for such inconsequential numbers? The new calculation
will make everyone look like they are doing better and they are really not.
STATUS REPORT ON THE WATER METER PROJECT PROGRESS This item involves a
status report regarding the water meter project.
Brian Wright gave a presentation:
• The Water Department began installation of the automated meter reading system in
September of 2008
• The initial phases (2008-2010) were performed by Measurement Control Systems
• All of the meter installations from 2011 to the present have been completed by District
staff
• As of September 9, 2013 a total of 11,657 meters have been installed
0 700 commercial
0 10,957 residential
0 93% of customers
• These totals include both new construction and new meters installed on existing customer
connections
• A total of 896 locations remain on the "Red Flag List"
o Locations where a meter has not yet been installed
• The main factors preventing previous meter installations have been:
8 Minutes: Sept 18, 2013
o Meter box was buried and/or could not be located
o Meter box was paved over or located under a deck, large rocks, tree, fence or similar
obstruction
o No meter box, only a curb stop
o Meter box was too small, too deep or damaged
o Excessive groundwater
o Broken/inoperable valves
• Remaining meter "Red Flag" list by location:
Area Quantity
Armstrong/Gateway 182
Donner Lake 37
Downtown/Olympic Heights 127
Prosser/Northeast 1128
Sierra Meadows/Ponderosa Palisades 1140
Tahoe Donner 1366
Commercial (Various Locations) 16
• Water Meter Project Completion Plan
o Three-person meter box installation crew created within Water Department field staff
o The Glenshire and Hirschdale areas have been completed
o Olympic Heights and a large portion of the commercial meters will be completed by the
end of September 2013
o Prosser Heights and Prosser Lakeview to be completed in the summer of 2014
o Sierra Meadows 2015
o Tahoe Donner in 2016-2017
o Armstrong and Gateway in 2018
• Customer Information System (CIS)
o CIS has been updated to address changing information in the field
— Multiple water services feeding a single residential structure
— Single services feeding multiple residential structures
— Developer/builder often provided inaccurate information regarding meter/service
locations
• Water Usage Trends
o Currently, approximately 7% of customers have a leak beyond the meter box
(compared to 10% in 2011)
o The main cause of leaks remains unchanged:
— Malfunctioning, damaged or improperly operated irrigation systems
— Corroded or improperly operated stop and drain valves
— Leaking toilets
— Corroded or damaged customer-owned service laterals
o The District continues to be strongly pro-active in regards to notifying customers of
pipe breaks and large customer leaks during the winter months
9 Minutes: Sept 18, 2013
o Detection and notification of leaks in the summer presents more challenges as
seasonal irrigation usage tends to mask leaks
• Average Daily Metered Consumption (gallons per connection per day)
o As expected, there are significant variations in water consumption when comparing
winter to summer
o Available data indicates a slight upward trend in summer water usage
o Winter water usage has remained constant
2011 2012 2013
Summer (May-September) 269 317 324
Winter (October-April) 103 103 103
• Fiscal Impact
o Expenditures related to the water meter project have been funded from the Reserve
for Future Meters Fund
o Revenues
— Fund began with $1.4 million
— $3.7 million revenue from 2009-2013 (Water Meter Surcharge)
Additional $250,000 directed into.the fund in 2011
o Expenditures: $4.3 million to date
o The projected balance in the fund for the end of 2013 is approximately $900,000
o Future expenditures are estimated at $450,000 per year for the next five years
o Final 3 years, project funding will come from rates
Public input:
• Why are there 37 meters to install at Donner Lake- thought they were all installed
during water system improvements
Board discussion:
• So the 3 man crew has to locate the meter, go to the main, dig out line and put in new
meter box. Some places don't have much room.
• Hugh undertaking. Great job.
• Does the $450,000 per year include both materials and labor
• The water meter surcharge is almost done. What is the $900,000 in the fund now?
• How many meters were installed in 2013? Seems like it is about 180 per year. One to
two meters per day?
• Is the crew full time, is this all they do? Has this diversion led to a shortage in
any other area? Are the crews not getting to routine maintenance because of the dedi-
cation of staff to do this project?
• Breakdown of numbers: staff versus contractors. Resource standpoint versus financial
standpoint.
• What is the deadline year to have all meters installed?
DISCUSSION OF THE PROCESS FOR ADOPTING NEW WATER RATES This item
involves a discussion Prop 218 and the process for adopting new water rates.
Robert Mescher gave a presentation.:
• California's Proposition 218
o Adopted in 1996
o Effective 1997
10 Minutes: Sept 18, 2013
o "Right to Vote for Taxes Act"
o Courts ruled that Prop 218 includes water utility rate changes
• FY14 & FY15 Budget
o Modest water rate increase needed in FY14 & FY15
— Board authorized HDR to perform rate and cost of service study
— HDR is scheduled to present results on November 6
o Must follow Prop 218
• Prop 218 Requirements
o Rates must be based on actual cost of service
o Notice must be mailed to all rate payers
o Notice may be mailed to all property owners
o Public hearing must be held after 45 days of notice
o If majority of rate payers protest, then rates are rejected
o Rates can become effective 30 days after public hearing
• Effect of Water Rate Changes and Meter Surcharge
Average Meter
Residential Surcharge Total
Current $60.21 $5.00 $65.21
Increase
1% $60.81 $0.00 $60.81
2% $61.41 $0.00 $61.41
3% $62.02 $0.00 $62.02
4% $62.62 $0.00 $62.62
5% $63.22 $0.00 $63.22
• Schedule
o October 16
— Present draft summary of FY14 & FY15 Budget
— Present draft of 10-year Financial Master Plan
— Propose water rate increase
o November 6
— HDR to present updated water rate and cost of service study
— Consider approving water rate increase subject to public hearing
o November 8
— Mail notices of public hearing to customers and property owners
— Advertise public hearing in local newspaper
o January 15
— Hold a public hearing regarding proposed water rates
— Consider adopting ordinance for new water rates
o February 14
— Adopted water rates can become effective
— Effective for utility bills printed after March 15
• This workshop is part of the overall budget process that will affect the District's
revenue and spending for the next two years
11 Minutes: Sept 18, 2013
There was no public input.
Board discussion:
• What is the required notification; what is the obligation of the District to determine a
protest versus a non-protest?
• Is the protest done in person or in writing?
• Do the rate payers have a chance at the hearing to vote or is ti just a protest?
• The HDR water study report will give the Board an opportunity to look at volumetric
pricing. Could change rates based on the study. It is a chance to fine tune the volumet-
ric charge. Say higher volume user may pay more with new charges or could pay less.
• Will HDR provide different options?
• Would be good to have different detailed options-what would a change in volumetric
charges mean? Different scenarios.
• Provide HDR with stratified water data; meter consumption data
• What would happen if we introduced two more tiers? What model should we use? 0
to 5,000, 5001 to 10,000- what numbers should be used?
• Plug in individual meter data for usage model.
• What would adding in tiers do to our rate structure?
• This would be a lot of work. Can HDR do this- get the Board close enough?
• What if ratepayers reject the new rates structure?
CLOSED SESSION
CLOSED SESSION PURSUANT TO GOVERNMENT CODE 54956.9(D)(4), CONFERENCE
WITH LEGAL COUNSEL ON DECIDING WHETHER TO INITIATE LITIGATION: MERGER
OF MID AMERICA AND NV ENERGY
RETURN TO OPEN SESSION
Report from Closed Session
There was a motion, a second and a unanimous vote (Director Ellis, absent) to authorize staff
to initiate litigation by intervening in the Merger of Mid-America and NV Energy.
ADJOURNMENT
There being no further business before the Board, the meeting was adjourned at 7:30 PM.
TRUCK PUBLIC UTILITY DISTRICT
JeffC$grt er, President
Prepared by r4 61
Barbara Cahill, Deputy District Clerk _._
12 Minutes: Sept 18, 2013