Energy Consumers Advisory Committee Meeting Minutes of Sept. 14, 2015

Transcription

1 IMPERIAL IRRIGATION DISTRICT Energy Consumers Advisory Committee Meeting Minutes of Sept. 14, 2015 IID Boardrooms Broadway, El Centro / Avenue 58, La Quinta I. CALL TO ORDER / PLEDGE OF ALLEGIANCE / ROLL CALL Chairwoman Lupe Ramos Watson called the meeting to order at 6:03 p.m. and led the Pledge of Allegiance. With 17 members present, a quorum was achieved. Members present (El Centro): Michael Anderson, Thomas Brinkerhoff, Eugene Bumbera, Gerald Gauna, Esther Gomez, John Hernandez, Shorty Hickingbottom, Gil Perez and Eric Reyes Members present (La Quinta): Steven Bayard, Becky Broughton, Paul Gibson, Richard Macknicki, Brian Macy, Lupe Ramos Watson, Patricia Saleh, Betty Sanchez and Mark Weber Members absent: Mark Larson and Lee Osborne II. PUBLIC COMMENT There were no public comments. III V. CONSENT CALENDAR The following items were included in the Consent Calendar. III. ECAC Meeting Minutes of Aug. 3, 2015 IV. Public Benefits Subcommittee Meeting Minutes of Aug. 24, 2015 V. August 2015 Year-to-Date Attendance Report A motion was made by Mr. Bayard and seconded by Mr. Bumbera to approve the Consent Agenda. Motion carried , with abstentions to items III and IV (identified above) by Mr. Bayard and Mr. Hernandez. VI. MWAS AND , TE AND TW RELAY REPLACEMENTS Mr. Noe Gutierrez, chief electrical engineer, presented a proposal to replace the modular digital automation relays and pilot wire protection relays for the TE and TW lines from the El Centro Switching Station to the Terminal Substation. The major work authorization projects and will cost $842,900, combined. Mr. Hernandez requested the equipment size and value. Mr. Gutierrez disclosed the size is about 18 inches by 6 inches and advised there is no equipment value; the relays will be discarded, but the cards may be useable. Mr. Perez inquired how the equipment will be safeguarded, to which Mr. Gutierrez specified the equipment is not easy to access, as it is locked in substation control rooms. Mr. Gutierrez noted Mr. Bayard s suggestion to contact ROMAC in Los Angeles, which buys similar equipment. In response to Mr. Bayard s perception of the equipment, Mr. Gutierrez articulated the problem is the equipment exceeded its lifespan and is no longer supported by vendors. A motion was made by Mr. Bayard and seconded by Mr. Perez to recommend approval of major work authorization projects and , the Modular Digital Automation Relay and Pilot Wire Relay Replacement Project for the TE and TW Lines. The motion passed unanimously (17-0-0).

2 VII. MWA , UNIT 2-1 STEAM TURBINE AND GENERATOR MAJOR OVERHAUL Mr. Michael Taylor, assistant energy manager, recommended approval of MWA , the El Centro Generating Station Unit 2-1 Steam Turbine and Generator Major Overhaul Project. The $5.9 million overhaul of Unit 2-1 will begin in October 2015 and be completed in May Mr. Perez questioned the price of a new unit and whether replacement is more economical. Mr. Taylor estimated a new turbine costs about $30 to $40 million and advised a unit is not typically more economical to replace. Mr. Taylor responded in the affirmative to Mr. Perez s question about the unit being a base load source. Ms. Saleh asked how current the equipment will be upon repair. Mr. Taylor verbalized the inspection includes the mechanical portion of the turbine and restoring equipment to its designed clearance to prolong reliability and increase efficiency. Replacement of the retaining rings will be an upgrade for reliability and safety; the rest [of the overhaul] restores the unit to design. Upgrading the unit technologically would be cost prohibitive. Ms. Saleh inquired how a new unit would compare in terms of efficiency. Mr. Taylor confirmed there would not be much difference; a new turbine would be slightly more efficient. The efficiency of a steam turbine is measured by the amount of steam it takes to generate a megawatt of electricity. Mr. Bayard asked if the steam traps will be serviced. Mr. Taylor advised the major items under review are highlighted and listed several of the associated auxiliary components of the steam turbine that will be examined. Referencing replacement, Mr. Weber presumed a capital improvement program exists to replace the turbine at some point and inquired when a decision would be made. Mr. Taylor responded that such a decision usually revolves around the need for a better heat rate--higher efficiency to have a better cost for the customer and a lower production cost for electricity. For steam turbines, the driving factor for replacement is the failure of the rotor or if the rotor body cracks or becomes unserviceable. By overhauling the unit periodically, the unit s lifespan is increased another 20 years. Mr. Carl Stills, energy manager, informed a holistic study was conducted by IID staff, which contains an analysis of generation. The information will be presented to the board subcommittee and general manager, then brought to the ECAC. Mr. Hernandez stated he supports maintenance to keep the equipment running efficiently. He referred to costs specified on Page 39, which are sole sourced, then questioned if Internal Labor will be outsourced. Mr. Taylor reported Siemens Energy is sole sourced as the technical field advisor for the on-site work. As the original equipment manufacturer, Siemens has access to all drawings and material specifications and has the expertise to perform turbine blade work. Additional service agreements are anticipated in the Outside Services category, but most go to Siemens Energy. If IID releases a bid, it is likely to cost more due to the lack of drawings and the need to reverse engineer components. The Internal Labor cost is conservative and will likely come in lower. A motion was made by Mr. Hernandez, seconded by Mr. Perez and unanimously passed (17-0-0) to recommend approval of MWA , the ECGS Unit 2-1 Steam Turbine and Generator Overhaul Project. VIII. MWA , JEFFERSON BRIDGE CONDUIT INSTALLATION PROJECT Mr. Guillermo Barraza, superintendent, Distribution Capital Projects, presented MWA for the installation of a conduit duct system through the new Jefferson Bridge. IID will run underground backbone feeders across Interstate 10, thereby tying circuitry across the freeway and boosting backup capability between existing and future substations situated north and south of the freeway. ECAC Meeting Minutes of Sept. 14, 2015 Page 2

3 Chairwoman Ramos Watson inquired if the project includes underground [work] around the project area. Mr. Barraza clarified the designers of the bridge are building away from the existing lines, so it is a new path for the conduit and the backbone system; however, Riverside County is undergrounding that which exists on the north side. Chairwoman Ramos Watson was curious if any of the existing overhead [system] will be modernized. Mr. Barraza communicated the overhead is away from the bridge, but a customer service proposal will address the portion [of the overhead infrastructure] on the north side. Mr. Weber requested the anticipated date of project energization. Mr. Barraza advised the plan is to have a circuit through the bridge in Mr. Weber asked if the heat generated in the conduit cells requires a fan mechanism, which Mr. Barraza confirmed the conduit system is also part of the bridge design, in which there will be vents and spacing between conduits. Ms. Saleh inquired if [the conduit] will be exposed to vandalism; Mr. Barraza said it will be underground and not exposed. A motion was made by Ms. Sanchez, seconded by Ms. Broughton and unanimously passed (17-0-0) to recommend approval of MWA , the Jefferson Bridge Conduit Installation Project. IX. POWER CONTENT LABEL Mr. Scott Harding, supervisor, Resource Planning and Acquisition, informed the ECAC of the district s power content label for 2014 and the projected power use for years 2015 through Citing Senate Bill 1305 and Assembly Bill 162, which require source information be provided to ratepayers, Mr. Hernandez asked if cost information is also required. Mr. Harding stated it is not a requirement by law, but the information is available in the Power Report, which is published annually. Mr. Hernandez questioned if movement is anticipated with the resource mix, considering recent legislation. Mr. Harding confirmed the 50 percent [Renewables Portfolio Standard] will require the purchase of more renewables, depending on the optimal resources available. Mr. Hernandez inquired about the length of natural gas contracts. Mr. Harding informed the Natural Gas Procurement Program to supply facilities goes up to 36 months, in accordance with the Energy Risk Management Policy. Mr. Weber mentioned IID owns the assets that are producing power from natural gas, so there is a continued sunk cost. He suggested it was rightly so, in order to have a diversified fuel portfolio. Mr. Weber requested the anticipated mixture for 2018 without coal. Mr. Harding articulated the staff looks at resource evolution often and there will be a difference; namely, an uptick in natural gas and purchased power sources, but much will depend on the power markets. Mr. Weber believed it would behoove IID to educate customers of the costs for cleaner fuels, as there is a cost associated with regulatory requirements. Mr. Harding expressed there will be changes in the resource mix from 2018 to As far as natural gas and unspecified sources, IID economically dispatches [energy] based on the procurement programs and the day-ahead and real-time perspective. The Energy Department makes the effort to reduce the cost impact of renewables, which is divulged in the Energy Cost Adjustment information process. Mr. Weber pushed for the cost to be more obvious, as it impacts all customers and makes California less competitive. Mr. Stills reported the impacts of SB 350; based on staff projections, a 50 percent RPS will require IID to buy a significant amount of base load, intermittent load or a mix. The must-take contracts will displace existing generators and sunk costs, potentially creating a loss of revenue. Mr. Stills also offered high level information about the operational analysis that was conducted. A motion was made by Mr. Weber, seconded by Mr. Bayard and unanimously passed (17-0-0) to acknowledge receipt of the 2014 Power Content Label. X PUBLIC BENEFITS PROGRAMS ECAC Meeting Minutes of Sept. 14, 2015 Page 3

4 Mr. Sean Schwerin, interim supervisor, Energy Customer Programs provided an overview of the energy efficiency portfolio and budget for 2016, seeking comments from the committee. The 2016 budget for Public Benefits energy efficiency programs is $7,178,792, with an estimated savings of 13,588 kilowatt-hours. The information was previously presented to the Public Benefits Subcommittee. Mr. Weber commented that incentives prompt customers to do that which they might not normally do. He explained the PBC objectives and advised a good decision needs to be made on where the funds will go and their efficiency. He further added that IID must wean away from programs that are not cost effective in The ECAC has a responsibility to give the Board of Directors good advice and push funds to programs that make sense. Mr. Stills advised that SB 350 should be taken into consideration. The , which stripped out petroleum, is 50 percent RPS and doubling the energy efficiency of buildings. Staff is reviewing the language to determine what it means, what the new targets will be, where the funding will come from and its impact to IID. Mr. Bayard echoed Mr. Weber s statement. The district made 87 percent of the mandated goal; if what is suggested is not done, IID will never make its goal and start paying fines. The only [program] that pays for itself is the Quality A/C Maintenance Program, which should probably be funded with more money and less money to Energy Rewards. Ms. Sanchez voiced that incentives are for those that cannot afford to buy new energy efficient appliances, but there is a disconnect: only those who can afford new appliances are receiving the incentives. Mr. Weber agreed with Ms. Sanchez and suggested targeting those who cannot otherwise afford a new refrigerator. Ms. Saleh stated as renewable energy targets are met and electricity costs go up, less people will be able to afford electricity. She advised the incentive be bigger. Ms. Sanchez recommended a low-income program. Recapping, Chairwoman Ramos Watson noted the committee would like staff to recommend to the Board of Directors that money be spent in the best possible way to get a better return on investment, while meeting the renewables energy standards. Ideas from the committee reflected the targeting of those with truly inefficient appliances; she wondered if proof of the retirement of an inefficient appliance can be written into the program. In addition, beef up the incentive and target such individuals with a marketing campaign. The ECAC is looking at these ideas from all perspectives as there is value in the program, but it needs fine-tuning to ensure a better ROI. Mr. Hernandez added that energy assessments are important to coordinating these activities and educating customers. The Quality A/C Maintenance Program is the biggest saver. Staff needs to look for creative ways to reach all segments of the community. Mr. Reyes requested further explanation of the targets. Mr. Schwerin informed that under AB 2021, the target setting is currently discretionary; there are no fines or [penalties] in place for not meeting goals. The target setting in the past was related to the budget. Under SB 350, those targets will no longer be discretionary. Mr. Reyes asked to which baseline the 50 percent applies. Mr. Schwerin referred to Mr. Stills statement about the need to review the language [of SB 350). Mr. Stills provided a summary of the Public Benefits Charge fund, which once had a $30 million balance and was spent down in 2012 and Mr. Reyes voiced his curiosity about a mismatch in the energy efficient targets and the budget. Mr. Stills explained doubling the efficiency for buildings could mean doubling the PBC fund, which is now at 2.85 percent and amounts to about $11 million a year. Staff is still interpreting the legislation, which passed the previous week. XI PUBLIC BENEFITS PROGRAM MARKETING PLAN Mr. Schwerin also presented the 2016 Energy Rewards Program Marketing Plan with a budget of $89,000 and sought comments from the committee per the Public Benefits Subcommittee s request. Mr. Hernandez mentioned a large portion of the Hispanic community watches television and suggested public service announcements be considered. Mr. Schwerin assured staff has checked into PSAs; however, when evaluating media, staff found more value in print and radio. ECAC Meeting Minutes of Sept. 14, 2015 Page 4

5 Ms. Sanchez affirmed there are PSA allocations for radio and TV stations and encouraged staff to target other locations, such as senior centers and Hispanic and church events. Ms. Saleh suggested an analysis of where the benefits will actually be used. Advertising a $100 rebate on a $1,200 refrigerator in a very poor area is a waste of advertising money. Mr. Schwerin asserted the challenge is with balancing the advertising budget and medium to target the proper customers. In doing so, staff needs to ensure it does not over-advertise a program with no remaining funds available. Chairwoman Ramos Watson reiterated there is a captured audience in the bill mailings and suggested inserting flyers, expecting the program would get many results. XII. PUBLIC POWER WEEK Mr. Schwerin additionally discussed Public Power Week, which takes place Oct. 4 through 7, in various locations. PPW comprises approximately $23,400 for light-emitting diode [light bulb] giveaway events, including supplies and promotion, funded from the Public Benefits Charge. Ms. Broughton requested staff provide the information to the county supervisor for the unincorporated areas of the Coachella Valley. XIII. DEPARTMENT UPDATE Mr. Stills reported problems with the control system of the guide vanes of Unit 3-1 at the steam plant, which has caused intermittent trips during the last month. Mr. Stills also briefed the committee on the $13 to $18 million event in Thermal caused by a tornado. Two distribution circuits and the K Line were lost, but are now online. Crews continue working around the clock on the L Line. Ms. Angela Evans, manager, Distribution Services and Maintenance Operations, and her crews are doing a super job. SB 350, which will be signed by the governor, will significantly impact IID. Mr. Stills reiterated the risk issues associated with the 50 percent renewables requirement. There are three significant provisions: The RPS compliance will have to be reported to the California Energy Commission under its standards. The district could be subject to penalties in the $50 per megawatt-hour range, exposing ratepayers to huge penalties if IID is not in compliance. The Risk Management Committee recommends exceeding compliance requirements so staff is setting slightly long targets. IID will be required to file the Integrated Resource Plan with the CEC, which is normally filed with the Western Electricity Coordinating Council. The regionalization of the California Independent System Operator provision allows CAISO to study governance outside of the state, which is concerning. IID believes CAISO is pushing to be the Regional Transmission Operator of the Western Grid. If CAISO can involve entities in the energy imbalance market, it can control their automatic generation control, which is an intermediate step to forming one balancing authority. Mr. Stills asserted the district will not give up control of its generators to the CAISO. XIV. AMERICAN PUBLIC POWER ASSOCIATION NATIONAL CONFERENCE REPORTS Mr. Bayard discussed his report on the APPA National Conference in June and commented it was a pleasure to attend and it would be nice if more members could go. Mr. Hernandez acknowledged Mr. Bayard s comprehensive report and thanked Mr. Stills for the opportunity to attend. The big discussion was the pending Environmental Protection Agency regulations. With the RPS and energy efficiency [requirements] increasing, revenues will drop; he hopes staff has sight of internal organizational efficiency. Mr. Stills confirmed less revenue is predicted and it does not mean fewer requirements. Staff is searching where to gain efficiencies and analyzing the cost of service on a subsidy basis to protect ratepayers. Mr. Weber articulated the importance of public power; he observed how well run and passionate the smallest utilities are and drew a comparison to Southern California Edison. The grand takeover by governmental entities needs to be combatted to retain independence. Public power allows IID s Board of Directors and the ECAC to try to find solutions. IID does a great job of keeping costs down; unfortunately, the employees are not as well compensated as those of ECAC Meeting Minutes of Sept. 14, 2015 Page 5

6 SCE. The point is public power is needed and getting educated at these events helps make that point. It also highlights the cost of power in California, which is stark when one sees the rates others pay across the United States. IID needs to budget for staff to attend APPA conferences and encouraged the board and general manager to consider it. XV. MEMBER COMMENTS Vice Chair Gomez hoped staff enjoyed the long weekend. Ms. Saleh appreciated members for attending the APPA and filling in the rest of the committee who could not attend. She inquired if reports exist of the greatest drains of renewable energy targets and if public assistance programs are advertised in those areas. She suggested using public funds for targeted advertising and meaningful incentives. Ms. Broughton expressed her amazement to see huge metal poles bent over [by the tornado] as if they were toothpicks. She was impressed with IID s handling of the problem and thanked all staff involved. Mr. Stills shared that Ms. Evans and her staff efficiently set up the Incident Command; Mr. Tom King, deputy manager, ensured various internal groups were looking at the system; and the crews closed the K Line before reaching the point of shedding load. Everyone worked as a team and it was very well coordinated--probably the most efficient emergency [operation] he has seen in 41 years at IID. Mr. Macy stated the APPA National Conference will be held in Phoenix, Arizona, June 10-15, Ms. Sanchez announced Coachella passed the expedited solar permit process, so hopefully that will help those who are installing solar in the city. She requested more information and guidance on IID s website about solar. Chairwoman Ramos Watson acknowledged the Home Energy Renovation Opportunity Program established through the Coachella Valley Association of Governments is also a good resource. Mr. Schwerin noted staff gets numerous calls regarding solar; as a utility, staff does not want to favor one company over another and encourages customers to get at least three quotes. There is much information on the website and staff is updating the Frequently Asked Questions portion. Questions or comments should be sent to Rosa Maria Gonzales, ECAC coordinator, and he will try to incorporate them. XVI. NEXT MEETING The next meeting will be held Oct. 5, 2015, at 6 p.m. XVII. ADJOURNMENT There being no further business, Chairwoman Ramos Watson adjourned the meeting at 8:11 p.m. ECAC Meeting Minutes of Sept. 14, 2015 Page 6