EMERALD PEOPLE'S UTILITY DISTRICT Board of Directors' Work Session January 23, 2018 Minutes

Transcription

1 EMERALD PEOPLE'S UTILITY DISTRICT Board of Directors' Work Session January 23, 2018 Minutes Convene President Parrish convened the meeting at 5:32 pm at the Emerald offices, Seavey Loop Road in Eugene. Attendance and Introductions Directors: Ron Davis, Brandon Jordan, Lee Kelley, Kevin Parrish, and Brian Parker (by phone). Staff: Doug Barab, Sara Cline, Scott Coe, Rob Currier, Brian Johnson, Kyle Roadman, Alice Schroeder, Brian Sharr, and Wendi McKay (note taker). Guests: None. Agenda Timeline Public Comment Coe proposed a deletion from tonight s agenda and requested to add an item to discuss last night s town hall meeting in Marcola and tiered rates. Parrish said that he would like to add an item to the agenda about a customer contacting him regarding a hydroelectric plant. None. Tiered Rates Discussion Coe began the discussion on tiered rates stating that we knew when the new rate schedule was implemented back in April 2017 that we wouldn t hear much about it throughout the summer because most customers stay under the third tier. We expected we would begin to hear about high bills during the winter months when customers have higher usage and heating loads. When we put together the 2018 budget, $100,000 was included to be able to help those customers with higher usage get their usage down. This was the main goal when the rates were put in place. We have three staff members, instead of the normal two, completing energy efficiency audits to help identify some different ways to reduce their usage and bill. Coe said when the December bills went out to customers, there was a stirring of customers in the Marcola area that were questioning the implementation of tiered rates. A town hall meeting was set up at the Marcola elementary school Monday evening to meet with these customers in an attempt to explain why December s bills were high. Coe said he explained to the customers that even though we didn t see snow or ice like last winter had, December still had many days with freezing temperatures. Coe displayed slides that showed December s average temperatures with current year and historical averages, along with one that compared December 2016 and 2017 temperatures. With these cold temperatures for extended periods of time, heat pumps may be going into emergency heat mode. Often time s homeowners are not aware that this mode turns on and causes higher usage than normal. This is just one of the reasons we send our energy efficiency team out on free audits to diagnose some of these issues.

2 Page 2 Coe told the group that tiered rates did ultimately add to high bills. Once the third tier or 1800 kwh is reached, customers are paying about $.03 more per kwh. These rate changes were adopted last year from a flat rate of $ The rates are $.01 lower for the first 600 kwh and the same as the previous flat rate for the next 1200 kwh. Coe said the break-even for customers is right around 2000 kwh per month, because they save $6 on the first 600 kwh. When we did an initial analysis in June after the tiered rates were in place, about 90% of our customers actually saw a decrease in their bill by about $6 per month. In December, that percent dropped to 64.5% of customers due to the use of electric heat. Jordan asked how many customers were under the break-even point, or around 2000 kwh per month. Roadman responded that we will find out that information and report back. Coe continued his report saying of the roughly 18,000 residential customers, about 2% were over 3000 kwh per month back in June. In December, this number jumped to 10%, so there are a lot of people with high bills. With the free energy efficiency audits, we re hoping we can get more customers under the third tier. Next, Coe shared a slide that showed all the months of the year. On an average year, December and January would be the coldest months, although we ve had a relatively mild January this year. With the tiered rates, a customer would expect to have an increase in their bill by about $17.22 in January, but saving an average of $6 a month throughout the rest of the year. Coe acknowledged that this is just an average customer and there are many customers that have far more usage than this model shows. Coe discussed two recent case studies of customers who called their Board members and had an energy audit completed on their homes. Both customers were adamant nothing could be done to help their high bill. However, upon completion of the audit, one customer was not aware of an issue with his heat pump for six years. We made some suggestions and his bill was lowered by about half. Jordan discussed his takeaways from meeting. He acknowledges there are still people who are upset about tiered rates. He said customers feel we are purposely targeting high users in an attempt to force them to conserve more and get an energy assessment. Jordan said we could have delivered our message in a more effective way, which may have helped eliminate these concerns. He said customers aren t hearing the reasons behind tiered rates, which is to ultimately save customers money on their bills. Parrish responded that they are hearing that message, but they aren t listening and have an opposing view. Jordan said that we could be doing a better job with how we message our new policies and the ongoing plan for long-term power supply. Coe agreed with this statement. Jordan said there are customers that are fundamentally against tiered rates and do not think that we should be making them conserve. There are others that have an issue with where the tiered rates fall and think the limit of the first and second tiers should be higher than 600 and 1800 kwh. Jordan noted that there is group meeting this Friday, but he s unsure if he will be invited or not. He said that some people felt liked they were talked over during the town hall meeting, and some people left early. If they would ve stayed, their opinions may have changed.

3 Page 3 Parrish delivered some of his main takeaways from the meeting. He said it seemed like some of the group doesn t understand how electricity is paid for and delivered. No one brought up the basic charge. In the past, we had customers that were concerned the basic charge was increasing to get closer to our cost of service, which is around $38 per month. We had a number of people on the low income side that argued we were raising our basic charge to discourage conservation. Parrish said the basic charge is to keep our overhead costs covered, regardless of how people are receiving their electricity. If the load decreases due to customers using alternative sources of electricity, then we can t cover overhead costs. Parrish said the group did not bring this up in the meeting and much of their information they had been receiving was unreliable. He said as of now, he is opposed to changing the tiered rates but is open to the idea that we may adjust it at some point. Jordan said he doesn t disagree with Parrish on the basic charge, but thinks it is a different argument. Jordan asked staff what our rates would need to be to still have the same basic charge. Coe responded that in theory they would need to be $.0796, however the reason behind tiered rates is to incentivize customers to get their power usage down. Jordan said he understood the reasoning behind tiered rates and supports it, but still wants to acknowledge the customers and make them feel they are being heard. Coe mentioned we pulled bills from the most active customers on the Facebook post. One customer stayed under 1200 kwh for the entire year. Another typically used between kwh per month, and would probably not let us do an audit. Coe welcomed an open and direct dialogue with customers so we can suggest different ways to combat the high usage months. Coe said we will be offering Saturday audits for those customers that work during the week and can t take time off. Coe asked the other Board members if they had received any calls about high bills. Davis said he has received two, Kelley, Parrish, and Parker have not received any. Coe said we will continue to work with the customers and review the rates after the one year mark. Several customers have signed up for the energy efficiency audits over the last few days and staff will continue tracking these audits and their outcomes to report back to the Board. Electric Vehicle s Overview Coe began the discussion on electric vehicles explaining the need to help customers after purchasing their EV s and make optimal energy decisions for themselves. This aligns with our strategic plan, as we want to be a partner with our customers for all things energy. Coe introduced Roadman and Currier to present the EV overview. Roadman said the presentation tonight will show an overview of trends in the market and how we plan to get a handle on the upcoming smart load growth. Currier gave a snapshot of international and national news as EV s have been a major trend in the transportation and electric sector. He said there are also different rebates and incentives that customers can take advantage of when making a purchase.

4 Page 4 Currier said according to data from the State of Oregon Department of Environmental Equality, there are about 170 EV s in our district. That number will only continue to increase as several major manufacturers have announced their plans to introduce new vehicles to the market. It is estimated up to 20% of Lane County will have EV s by 2032, therefore, we need to work with customers on how to manage charging habits so not everyone is charging at the same time. There are different ways to incentivize customers including time of day rates. For example a lower rate if they charge at 10:00 p.m. instead of 7:00 p.m. Getting in front of this early and figuring out some of the solutions ahead of time is crucial to providing benefits for the customer and the utility. Some of the challenges we foresee are knowledge and awareness for customers not familiar with the EV market, the charging infrastructure availability, and effects on transmission and distribution. Currier said some of the plans for 2018 to help educate customers include introducing a new EPUD EV website, education modules in our Powerlines newsletter, and coordinating with FORTH for ride and drive events and other training. Roadman said we will be creating an incentive program for the Board to review at a later date. We hope to pursue public charging stations for our customers at our building as well as customer facilities. Coe concluded that now is the time to educate ourselves so that we are better able to help our customers navigate this change. Lighting Rate Schedule Changes Johnson and Roadman presented the current lighting rate schedule to the Board and subsequently the proposed new rate schedule. Currently, lighting customers are spread across four rate schedules. Some of the issues with this schedule include the co-mingling of customer types which make it confusing to keep track of, the lack of incentive for efficient usage, and inventory management. The proposed actions to these issues are as follows: merge lighting customers into three rate classes, adjust charges and fees to incentivize efficiency, and standardize inventory for Emerald owned facilities. The three rate classes would now be emerald-owned and maintained facilities, customer-owned, and recreational field lighting (schools and non-profits). Coe said this new rate schedule will make it easier for customer service to manage. During the next Board Meeting, staff will ask for Board approval for these changes. They will be effective with the rest of the rate changes on April 1, 2018.

5 Page 5 Scholarship Program Changes Roadman gave a brief background on the scholarship budget the Board recently increased to $15,000. Staff analyzed options to restructure the program for 2018, and recommends maintaining the five total scholarship awards to be divided equally at $3000 per award. The number of awards per category will be determined based on merit and may change year-to-year. The next steps include a press release this week announcing the new scholarship program with applications due by April 17. The applications will be reviewed by staff the week of April 18-26, and awards announced on May 1. The award presentation will take place at the June 12 Board Meeting. Meter Install Contract - Preview Coe said recently a request for proposal (RFP) for the meter installation was sent out and bids came back much higher than expected. We will be going back to those that submitted proposals with a request to adjust the wages in the proposal. It seems they may have used a prevailing wage like that of a journeyman lineman when calculating, and it doesn t need to be a lineman doing this type of work. If the proposals come back high a second time, we will have our qualified employees complete the work. Hydroelectric Power Plant Parrish was approached by someone asking about a hydroelectric power plant and if we would be amiable to it. Parrish said he looked up Oregon law regarding this and it looks like something we would have to approve. Parrish s concern is mainly the cost involved as the meter could potentially be running backwards if he is producing more power than consuming. Roadman responded that it would be consistent with what we charge our other solar customers which is a basic charge even if they are net metering. Currier said in our net metering policy, there is language that limits the production of a system to equal the consumption on the meter. The intention is just to offset the usage on the meter. Roadman said our current policy is to offer up to 25 kw for net metering. Parrish concluded saying the customer still has a lot of work to do to get it up and running, but will keep us updated with any changes. Board Director Comments Davis mentioned there is another EPUD web address that is charging customers $5 to make their payment, it is something to look out for as customers may ask about it. Public Comment Adjournment None. President Parrish adjourned the Board meeting at 7:24 pm. Minutes prepared by Wendi McKay, Executive Assistant.