EMERALD PEOPLE'S UTILITY DISTRICT Board of Directors' Work Session June 26, 2018 Minutes

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1 EMERALD PEOPLE'S UTILITY DISTRICT Board of Directors' Work Session June 26, 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: Brandon Jordan, Ron Davis, Bent Mikkelsen, Brian Parker, and Kevin Parrish Staff: Patty Jo Angelini, Doug Barab, Alicia Burgess, Sara Cline, Scott Coe, Rob Currier, Kyle Roadman, Alice Schroeder, Brian Sharr, and Wendi McKay (note taker) Guests: Pat Coy, Conrad Davis, Jim Krowka, Tenaya Jewell, Susie Rodrigues, and DeAnna Townsend Agenda Timeline Coe asked for the addition of two items to the agenda. One item was the presentation of the Green Grant Award. The winners this year, Mid Lane Cares, were present to receive their award. The second item Coe requested was the addition of a short GM report since Coe had been out of the office for four weeks. Davis asked to add a discussion for the impact of carbon obligation on the electricity sector. Coe said we will add this item to the July work session, as it is an extensive topic that would require staff preparation. Public Comment Customer Susie Rodrigues asked to address the Board. She said she has concerns about smart meters. She has been a customer since 2011, and reads her bills and the inserts that come with them. She said she has not seen notification that EPUD is considering smart meters and does not feel that she is being represented as a customer. Rodrigues said she does not have extra technology in her home and prefers it that way. She mentioned she lived behind a Weyerhaeuser gate and it was easy for her to read her own meter and send staff the reads each month. At the end of the year, the numbers were trued up to ensure they matched. She would like this to be an option again for customers. Next, customer Jim Krowka asked to speak. He has been a customer since 1986 and has always loved the utility and received great service. He expressed disappointment in the smart meter installation because there is not a lot of information about the repercussions and health aspects of the technology. His wife has a condition that makes her sensitive to different chemicals and there is a link to health impacts from the radiation emitted from smart meters and Wi-Fi. He acknowledged the research shows two opposite ends of the spectrum when looking at health problems from smart meters.

2 Page 2 One side says there are no health problems and the other says they can cause a multitude of issues. Between those two extremes, somewhere in the middle, is where the truth may be. Krowka believes there are other options for the utility other than smart meters. Green Grant Award Recipient GM Report Mid Lane Cares from Veneta was presented with the 2018 GREEN Grant. The GREEN (Giving Renewable Energy to Emerald Neighborhoods) grant is entirely funded through GREEN participants and is awarded annually to a nonprofit organization in the district to finance renewable energy projects or programs. Each year, the winning organization is decided by the votes of customers who subscribe to GREEN. Mid Lane Cares executive director, DeAnna Townsend and Board member Pat Coy were on hand to accept the award. This is the second year in a row that Mid Lane has won the award. Both Coy and Townsend thanked those in their community who voted and support them. The board took a brief break at 5:50 pm to congratulate Townsend and Coy. The meeting resumed at 5:55 pm. Coe began his report thanking Roadman and the staff for covering for him while he was out of the office for four weeks. Coe said Cline will be covering for him in October while he is on vacation. Coe said recently the utility received the E.F. Scattergood System Achievement award at the APPA conference in New Orleans. Cline accepted the award on behalf of the utility. The award recognizes a community-owned utility that has enhanced prestige of the APPA and of public power through outstanding service. Some of the achievements that were recognized were the Sharing Sun Community Solar project, the GREEN Grant Program, Energy Efficiency Program, and Grid Management Initiative, among other categories. Next, Coe discussed the recent meter replacement milestone. There have been over 6200 installs to date. There will soon be a company hired to complete a system survey, which will ensure the mapping system is correct and that equipment is all accounted for. This survey is more about the poles, transformers and other equipment, but will also help prevent the problem of missing meters. A new Geographic Information System (GIS) specialist, Caitlin Todd, has been hired. She will begin on July 9 and is coming from the City of Eugene. Caitlin will be working on putting all the mapping, system survey, and GMI data pieces together. The Northwest Energy Efficiency Alliance (NEEA) has lost a board member. Coe will be replacing the member and will begin orientation in the coming weeks.

3 Page 3 Next, Coe discussed the upcoming July work session. One of the items slated for discussion is an update on the strategic plan. Coe concluded his report thanking the board for allowing him the time off. He completed the Comrades 90k (56 mile) run in South Africa Budget Preparation Schedule Coe said every year we run the budget preparation schedule by the Board for approval. If there are any changes needed, the Board should let Cline know before the next meeting where the schedule will be approved. The Board all agreed the schedule looked good the way it was prepared. Davis commented that he hoped the rate structure would be reviewed again at some point. Coe responded that since there was just a recent vote, there wouldn t be a reason to revisit it and change it a month or two later. Davis asked if tier 3 was needed and Coe said it is needed for this rate structure because it s how it was designed. If the third tier went away, the other two tiers would need to be redesigned. Coe said the basic charge and closing the cost of service gap will be reviewed and the Finance and Rates Committee will work on the numbers to present to the Board. Parker asked when the cost of service will be looked at again. Coe said the last time was in 2015 and generally it is every five years. This analysis is a large expense so we would like to be able to figure out a way to look at it more frequently at a staff level. Davis asked a question about customers with multiple meters, specifically if there should be a full charge for all of their meters. Coe said the cost of service is probably lower and this is something that will be looked at once the system survey is complete. Currently it s anecdotal and each situation varies. Electric Vehicle Strategy Coe began the discussion on the Electric Vehicle strategy proposal. Emerald has now purchased a Chevy Bolt for the Energy Efficiency department, and another will be purchased as a motor pool vehicle. Coe said electric vehicles are more prevalent in other areas around the world. Daimler, in Portland, is planning to move forward in the electrification of their full range delivery trucks that will be plugged in daily after their routes. Emerald would like to partner with these businesses. One reason for partnering is so these trucks are not all coming in and plugging in at the same time, creating a spike in usage and forcing infrastructure upgrades.

4 Page 4 Roadman presented Emerald s EV Strategy to the board. He first discussed some important updates to different programs. Recently, Emerald sold its 814 residential credits from the Oregon Clean Fuels Program, receiving around $40,000. These funds helped kick start the EV charging station project. Currently, there is a lot of momentum on EV s within the community. OPEC has data showing the electric vehicle forecast grew by almost 500% in 2016, so it s important to prepare for this type of growth. Roadman said there are three goals to the EV strategy. The first is having incremental net revenue through higher utilization of existing system assets, therefore not growing our system, but managing it. The second goal is building stronger customer relationships by promoting clean, money-saving transportation. The last goal is the enhancement of Emerald s role and reputation as a trusted advisor on energy issues. Next Roadman discussed the benefits for smart load growth for the utility. He showed a financial analysis for a potential use case using an example of a 2017 Nissan Leaf. The average annual net revenue would be around $187 per vehicle, which would help cover much of the capital cost. System peak demand will need to be managed so that there is not a need to upgrade infrastructure. Time of use rates or demand response are two ways of managing the peak demand. The annual revenue by 2025 is projected to be around $96,492. Roadman discussed sample EV pricing using time of use incentives. These incentives could potentially be offered to customers due to the Advanced Metering Infrastructure (AMI). Roadman showed slides of a recent customer survey that was launched. About 70 customers completed the survey and the data was compiled for the Board to view. Some funding sources for this project include using the recently sold credits from the Clean Fuel Program, as well as Public Purpose Funds, and Self-funded promotions. There are customers that pay into the public purpose funds, and there is about $15,000 budgeted by the utility for incentives and/or promotions. Currier demonstrated the new website for the Board. There is a tool customers can use to compare their current vehicle to a specific EV model. Roadman discussed the next steps in the program launch. The first would be community outreach and getting information out on social media for customers to view. There are community events, such as Coordinate Ride and Drive events with FORTH and other stakeholders that the utility will be involved in.

5 Page 5 Some of the proposed incentive programs include public charging and monetary incentives. For example, an opportunity for low cost charging at EPUD s HQ and other workplaces in the territory, $100 to each customer that purchases an EV and registers with EPUD, and $500 to homes or businesses that install qualified Level 2 charging. Parrish said he is hesitant to offer incentives since it s for a very limited amount of customers. Mikkelsen discussed the influence that businesses can have on employee vehicle purchases. He said many employees tend to purchase vehicles around the same time as their co-workers. It would be good to communicate and have incentives for businesses. Roadman said we can try with or without the incentives, but if it s not managed it could end up costing customers money due to the need for upsizing infrastructure. The Board all agreed with the $100 incentive for customers, but nothing more at this time. The Board paused the meeting for a brief break at 6:55 pm and reconvened at 6:59 pm. Net Metering and Solar Policy Discussion Coe began the discussion on Net Metering updates and said one of the reasons for this agenda item was due to a customer who was in attendance, Conrad Davis. Davis attended a previous meeting a couple of months ago and brought up some suggested changes to the policy. Coe said this policy was one that should have been reviewed anyways, so it was perfect timing when the customer brought it to the Board. Currier went through the net metering background with the Board. The current policy follows law ORS that governs net metering and that utilities abide. The Board does have some leeway with the law and is empowered to update the policy within the guidelines of the law. Currier said net metering is intended to measure the difference between the power that is delivered to a customer and what they generate and send back to the utility. That difference is what they are billed on. Currier said it only applies to renewable resources, but there is a broad definition to what that entails. Any unused energy credit accumulated during the previous year shall be granted to the utility for donation, customer credit, or otherwise dedicated. Typically these credits help the utility s low income billing assistance program, Helping Hands. Emerald adopted its Net Metering policy in 2011 with some specific requirements not found in the law, including a true-up date at the end of the calendar year.

6 Page 6 Currier said there is a caveat to the law that says the utility is obligated to offer this program up to.5% of their single hour peak load. Emerald recently reached this threshold in February 2018, which was about 700 kw. Parrish clarified that this means the utility is no longer required to offer net metering since meeting this threshold, Currier and Roadman confirmed this statement. Currier showed the Board two examples of customers. One customer had an over generating summer but the usage was used up by the end of the year. The second customer had a surplus at the end of the year, with a value loss of about $83. A survey with other utilities was completed to show the Board what their policy s look like. Occasionally, a customer will ask about meter aggregation. Currently, Emerald does not aggregate multiple meters together. Jordan asked how difficult this would be to change. Roadman responded that this is a customer service question, but implied it would not be an easy fix. Next, staff discussed possible scenarios for policy changes; saying there are a couple of different options to update the policy. Staff recommended keeping the current policy, with some minor updates. These changes include changing the month of the annual true-up from December to March. The second recommendation is to allow virtual net metering systems into the policy. Some other utilities do a month to month true up or an alternative monthly payout at the utilities avoided cost. Parrish said he does not like the idea of subsidizing some customers at the expense of other customers, but does not see a problem with making an adjustment to the true-up month to March 31. He also recommended keeping the capacity limit at 25 kw. The Board agreed with these recommendations. Roadman said the new policy update will be included in the next business meeting for Board approval. GM Interim Designation Coe distributed the statute ORS , Appointment and removal of district manager. The statute states the Board shall appoint an interim or acting manager in the case of an absence or temporary disability of the district manager. Coe discussed what a temporary disability might entail, and when the appointment would need to take place. He asked the Board if this should be done proactively and have someone already designated. The signing authority would not immediately go into effect if the manager is out of the office, it is more of a precaution taken if something were to happen to the manager that left them incapacitated and unable to make decisions. This is when the Board would enact the interim manager and they would have signing authority. Coe proposed he and Cline would write something up for Board approval at the next business meeting.

7 Page 7 Board Self-Assessment Parrish discussed the self-assessment exercise from last month s work session. The directors were to take the list of questions and bring them back to this meeting with any changes they wanted to make. Mikkelsen brought up question 10 from the assessment, about individual directors refraining from acting on utility matters without full Board approval. Parrish responded that once the Board makes a decision on an issue, it s important for all directors to support it. There has to be one Board and one voice and as an individual each director has no power. Parrish said the goal for the next work session is for all directors to bring in the completed assessment for discussion. The completed assessments will be distributed to the board secretary for the answers to be compiled. This exercise will be a good way of gaging what training opportunities need to happen and any other issues needing to be addressed. Public Comment Rodrigues asked to make another public comment. She brought up the topic of EV s that were discussed during the meeting. She said the district is made up of a lot of rural areas, where EV s are not as common as they are in the city. Rodrigues also said when she initially purchased her home, her meter was right near her living area and thinks it would be better if meters were located near the garages on homes. She said the Board represents a lot of the working poor in the community and doesn t think they should be offering an incentive for an electric vehicle but penalize someone who just wants to move their meter. Krowka also asked to address the Board again about his concerns for smart meters. He asked if the meters store data, Barab responded that there is a small ram chip in the meter but only stores the data until transmittal. Krowka said there is growing concern of the GMO s in the food we consume, and now adding to radiation with smart meters is a cause for more concern. He suggests the Board investigate these health issues and take into account what customers want as well. Adjournment President Parrish adjourned the Board meeting at 7:46 pm. Minutes prepared by Wendi McKay, Executive Assistant.