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Public Utilities 2022/05/25CITY OF ANAHEIM PUBLIC UTILITIES BOARD MINUTES May 25, 2022 The agenda having been posted on Thursday, May 19, 2022, the Regular Meeting of the Public Utilities Board (Board) was called to order by Chairperson J. Seymour at 5:00 p.m. on Wednesday, May 25, 2022, in the Gordon Hoyt Conference Center, 2nd floor, Anaheim West Tower, 201 S. Anaheim Blvd., Anaheim; California. Board Members Present: Chairperson J. Seymour, Vice -Chairperson V. Baroldi, R. Bhalla, A. Abdulrahman, N. Campos Kurtz, M. Lee, A. Pham Board Members Absent: None City Staff Present: D. Lee, P. Starr, A. Kott, B. Beelner, M. Avelino -Walker, J. Lonneker, C. Parker, J. Lehman, M. Seifen, E. Krause, F. Barvarz, S. Boodanian, C. Gomez, J. Sanks, C. Pereyra, A. Nguyen, J. Dulebohn, M. Martin Guest(s) Present: Schweitzer Elementary School, Magnolia School District: Connie Martin, Board Member; Dr. Frank Donavan, Superintendent; Marcy Chant, School Principal; Bill Bailey, Chief Business Official Price Elementary School, Anaheim Elementary School District: Jackie Filbeck, Board Member; Mark Lopez, Board Member; Alex Ramirez, School Principal; Ray Vidales, Teacher AGENDA ITEM 1. PUBLIC COMMENTS. ACTION TAKEN There being no electronic or oral public comments, Chairperson J. Seymour closed the public comments portion of the meeting. 2. RECOGNITION: SUSTAINABLE SCHOOLS AWARD. M. Avelino -Walker, General Services Manager, provided an overview of the recognition and the selection process for the Sustainable Schools Award. The Board recognized Schweitzer Elementary from the Magnolia School District and Price Elementary School from the Anaheim Elementary School District, as the winning recipients of the Sustainable Schools Award. 2022 - 33 3. APPROVAL OF THE MINUTES OF THE PUBLIC UTILITIES BOARD REGULAR MEETING OF APRIL 27, 2022. * 4. SET A PUBLIC HEARING DATE FOR THE 2022 PUBLIC HEALTH GOALS REPORT. J. Lehman, Assistant General Manager — Administration and Risk Services, shared that last month the Board was presented with Anaheim's Annual Water Quality Report that confirmed that the water served by Anaheim Public Utilities (APU) met all State and Federal Drinking Water Standards and is requesting approval to hold a public hearing on the 2022 Public Health Goal Report. By way of background, J. Lehman indicated that every three years, since 1998, California water utilities servicing more than 10,000 customers are required to compare their water quality to the State's Public Health Goals and the Federal Government's Maximum Contaminant Level Goals and hold a Public Hearing to allow for comments on the results. Public Health Goals are set at the level at which there is essentially no health risk to the most sensitive populations, they are not enforceable limits; however, water agencies must report on these results, as described. APU met 81 of the 88 Public Health Goals. The Public Health Goals that were not met, with three exceptions, were all from naturally occurring elements. The exceptions were Bromate, which is a by-product of ozone disinfection of water that has naturally occurring Bromine, and perchlorate and trichloroethylene which are from industrial sources. J. Lehman requested the Board's approval to set a public hearing to receive public comments on the 2022 Public Health Goals Report for June 22, 2022. She shared that a hearing notice would be published in the newspaper in June and the 2022 Public Health Goals Report would be posted on APU's website and available at the Customer Services front counter on the first floor of Anaheim West Tower. 5. PRESENTATION: 2022 POWER SUPPLY SUMMER OUTLOOK. E. Krause, Integrated Resources Manager, presented the 2022 A. Abdulrahman moved the approval of the Minutes of the Public Utilities Board Regular Meeting of April 27, 2022. V. Baroldi seconded the motion. MOTION CARRIED: 7-0. ABSTAINED: 0. ABSENT: 0. N. Campos Kurtz moved the approval of the Setting of a Public Hearing date for the 2022 Public Health Goals Report. M. Lee seconded the motion. MOTION CARRIED: 7-0. ABSTAINED: 0. ABSENT: 0. 2022 - 34 Power Supply Summer Outlook. E. Krause began with a discussion on the need for the summer outlook and why it is performed by the California Independent System Operator (CAISO) and APU. He explained that the continued transition in power supply resources seen across the Californian grid and the move to more intermittent resources along with reductions in conventional resources are drivers of the assessment. Key findings were discussed from the CAISO Summer Assessment, identifying the low hydro conditions, reduction in probability of firm load shedding due to the addition of new resources, and potential concerns due to widespread heat events. E. Krause continued with a review of CAISO 2021 actual peak loads and resources, as well as the 2022 expected peak and resources available for summer and elaborated on the lower than expected 2021 peak for the CAISO and relativity similar expected peak for 2022 along with the addition of resources from 2021 to 2022. Further E. Krause discussed the reduction in peak load and clarified the difference between an instanteous peak load compared to total load and energy. As for the 2022 summer weather forecast, there is a possibility of monsoons moving through the western region. He continued with a discussion of the potential impacts, such as lightning strikes which could lead to fires. Higher temperature weather patterns are expected in the early part of the summer this year. E. Krause continued with a discussion of the 2022 fire season, and showed that projections for the northern part of California are at a higher risk of wildfires. The presentation continued with an explanation of the mitigation measures used by the CAISO to address potential shortages, such as discharging large batteries and maximizing imports. Included are communication tools such as Flex Alerts to reduce energy use. The last resort is to shed firm load (or rolling blackouts) when ordered by the CAISO, which prevents a more catastrophic and widespread blackouts. Simulation exercises hosted by the CAISO and APU's interdepartmental simulation were discussed, along with review of the 2020 firm load shed occurrence and 2021 fire related transmission reductions. E. Krause concluded the presentation with a set of takeaways; while substantial resources are available for the summer, there is still a risk under certain circumstances that APU may be called on to reduce load. APU is ready to respond and mitigate the impacts to customers and utilize coordinated efforts with key stakeholders. The Board inquired whether the CAISO or utilities manage the batteries on the system. E. Krause responded that batteries are 2022 - 35 managed by a combination of utilities and the CAISO has a mechanism to ensure charging and discharging at appropriate times. The Board followed up with an additional question regarding the duration of the connected batteries. E. Krause explained that there are different durations of discharge depending on the need, and that if the battery is for 4-hour duration, it can qualify for the CAISO resource adequacy. The Board asked how far in advance does APU receive notification of an outage or be able to predict the need for an outage. E. Krause explained that if it is a known condition, such as the fires in Northern California, coordination begins as soon as there is a potential impact to the transmission system. In addition, with the creation of the 7-day look ahead, coordination can begin further out and steps can be taken in advance to overcome the issue ahead of time if the condition presets with communication ramp ups leading to the potential hours impacted. D. Lee explained that in the case of 2020, there was a 10 minute notice and it caught everyone by surprise as a result. E. Krause explained the 7-day look ahead that was developed due to the issues with the 2020 outages. The Board asked about the block number outage list on the website and if it carried over from year to year or reset. D. Lee responded explaining that the list rotates through the block numbers and for the last 20 years it was the same until we had the 2020 event, at which time the impacted blocks moved to the end of the list. 6. RECOMMEND ADOPTION OF THE PUBLIC UTILITIES DEPARTMENT'S FISCAL YEAR 2022/2023 PROPOSED BUDGET. * B. Beelner, Assistant General Manager - Finance and Energy Resources, reviewed APU's Fiscal Year 2022/2023 proposed budget and described how electric retail revenue continues to soften due to distributed generation and energy efficiency from customers. B. Beelner explained that power supply expenses are increasing primarily due to debt service costs associated with the Canyon Power Plant (CPP), indicating that savings from the CPP refinancing was applied during the prior two years to ease pandemic -related cost pressures, and debt service costs will now return to normalized levels. B. Beelner also noted that water supply costs are decreasing as some groundwater treatment sites are expected to go online next fiscal year, reducing the need for costly imported water and also noted that debt service expenses were increasing due to the recent bond issuances. N. Campos Kurtz moved approval of the adoption of the Public Utilities Department's Fiscal Year 2022/2023 proposed budget. A. Pham seconded the motion. MOTION CARRIED: 7-0. ABSTAINED: 0. ABSENT: 0. 2022 - 36 B. Beelner added that the proposed budget accomplishes APU's goals of reliability and affordable rates. 7. APPROVE AND AUTHORIZE THE POSTING OF ANAHEIM V. Baroldi moved the PUBLIC UTILITIES 2022 WILDFIRE MITIGATION PLAN approval and authorization (WMP) AND SUBMITTAL TO THE CALIFORNIA of the posting of Anaheim WILDFIRE SAFETY ADVISORY BOARD; AND Public Utilities 2022 DETERMINE THAT THE PROGRAMS AND PROJECTS Wildfire Mitigation Plan REFERENCED IN THE WMP ARE EXEMPT UNDER THE (WMP) and submittal to the CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) California Wildfire Safety PURSUANT SECTION 15301, SECTION 15302, SECTION Advisory Board, with the 15303, AND/OR SECTION 15304 OF TITLE 14 OF THE clarification that the item CALIFORNIA CODE OF REGULATIONS. * does not need to be forwarded to the City J. Lonneker, Assistant General Manager — Electric Services, Council. N. Campos Kurtz introduced F. Barvarz, Electric Transmission & Distribution seconded the motion. Manager, to present on APU's 2022 Wildfire Mitigation Plan (2022 MOTION CARRIED: 7-0. WMP) updates. ABSTAINED: 0. ABSENT: 0. F. Barvarz discussed the requirement for preparing annual wildfire mitigation plan updates, reviewed the Wildfire Safety Advisory Board's (WSAB) role, and made recommendations pertaining to the APU 2021 WMP, which staff incorporated into the 2022 plan. F. Barvarz continued with WSAB's review comments of APU 2021 WMP highlighting APU's metrics development, risk assessment and mapping, and community outreach. F. Barvarz then provided an update on the metrics, undergrounding project completion on Eucalyptus Dr.in a high fire threat area, planned undergrounding of the remaining 3.2 miles of overhead lines in fire threat areas, and APU's network of 10 cameras overlooking Anaheim's wildlands. F. Barvarz also discussed coordination with Anaheim Fire & Rescue and Parks for wildfire abatement. Lastly, F. Barvarz requested Board action to consider approval of the 2022 WMP, posting on APU's wildfire page, and forwarding of the 2022 WMP to the WSAB for review. D. Lee clarified that the item is an interim plan that does not need be forwarded to City Council for approval; however, the 2023 plan will be a full update and will include a public hearing and Council consideration. The Board inquired about how incident command is structured, and staff explained that if an emergency requires activation of the City Emergency Operation Center, then Anaheim Fire & Rescue takes the lead and other departments participate accordingly. 8. APPROVAL OF THE COOPERATIVE AGREEMENT WITH M. Lee moved the approval MUNICIPAL WATER DISTRICT OF ORANGE COUNTY of the Cooperative Agreement with Municipal 2022 - 37 FOR SHARED PROGRAMS AND SERVICES. * C. Parker, Water Engineering Manager, discussed the Cooperative Agreement with Municipal Water District of Orange County (MWDOC) Shared Programs and Services. The agreement will leverage economies of scale services for technical studies, conservation programs, and emergency mutual aid efforts. APU has been collaborating with MWDOC since 1998 on these types of services and is simply executing a new agreement for this item extending this partnership into the future. 9. UPDATE ON ELECTRIC SYSTEMS ITEMS. J. Lonneker, Assistant General Manager — Electric Services, explained to the Board that the Underground Conversion (UGC) Subcommittee elected not to add new projects to the 5-year Plan and re -affirmed the current 5-year Plan. The decision is based on the number of current projects in the Plan and the rate at which those projects would draw down available funding. J. Lonneker shared with the Board updates on specific active projects and also shared the link on the APU website to find updates on all projects in the current 5-year Plan along with an updated construction schedule. J. Lonneker shared with the Board a preview of an APU video providing an overview of the resources and infrastructure to deliver power to the community. J. Lonneker explained this video will be posted for public information on social media as an introduction with the intent to create a series of videos informing on safety and other topics of interest. 10. UPDATE ON WATER SYSTEM ITEMS. C. Parker, Water Engineering Manager, updated the Board on the current water supply condition, which has not changed from last month. C. Parker briefed the Board on the drought Level II item approved by City Council at its meeting on May 17, 2022, as well as the outreach to the community to educate the public on the mandated conservation level. C. Parker added that APU had a water awareness outreach event at the Farmer's Market, groundwater treatment plant project outreach at Boysen Park and Downtown Well (near the Packing House), and valve replacement project on Nohl Ranch Road near the Anaheim Hills Golf Course. 11. UPDATE ON FINANCE & ENERGY RESOURCES ITEMS. Water District of Orange County for Shared Programs and Services. N. Campos Kurtz seconded the motion. MOTION CARRIED: 7-0. ABSTAINED: 0. ABSENT: 0. 2022 - 38 B. Beelner, Assistant General Manager — Finance & Energy Resources, thanked the Board members that toured the Magnolia Power Project and mentioned that as COVID restrictions relax other tours, such as of the California Independent System Operator, would resume. B. Beelner then discussed the Finance Dashboard and focused on the water revenue. B. Beelner highlighted the higher than projected water sales and how these positive variances would, in all likelihood, become negative variances in the coming months as drought restrictions take effect. B. Beelner then discussed the Power Supply Dashboard and specifically highlighted the better than expected wholesale revenue and mentioned that the recent growth in wholesale revenue was largely a factor of higher power prices driven by higher than normal gas prices due to the conflict in Ukraine. He also discussed the wide variances in wholesale prices in April, and how APU is able to offset other costs by selling power generated by the Canyon Power Plant in the market when those wholesaler prices are higher than normal. 12. UPDATE ON ADMINISTRATION & RISK SERVICES ITEMS. J. Lehman, Assistant General Manager — Administration and Risk Services, provided the Board with an update on the Wholesale Energy Risk Management (ERM) Program's Quarterly Compliance report for the first quarter of FY22 and indicated that during this period there was a violation of the ERM Program, and explained that the violation was due to the missed submittal of a forecast because of a staff error. J. Lehman added that the violation had been mitigated and appropriate corrective actions were taken to ensure that it does not occur again and that all other transactions were within the ERM requirements. The Board asked how this occurred, and D. Lee explained that with nearly 70 new staff members following retirements and resignations over the past two years, training is an ongoing effort to ensure procedures are being followed. J. Lehman invited the Board's attention to the Internal Compliance Plan in their packet and shared that all programs were in compliance, and there were no violations during this period and provided highlights from the report. J. Lehman discussed the Administration and Risk Services Dashboard and highlighted three bills being monitored closely by staff and industry groups, and also reviewed the safety metrics. 2022 - 39 13. ITEMS BY SECRETARY. D. Lee, Public Utilities General Manager, shared agenda items planned for next month: • 2022 Public Health Goals Public Hearing • Recognition of WaterSmart Landscape Award Winners • High School Scholarship Recognition • Agreements o Water Construction Master Agreements o Pre -Qualified Engineering Firms o Credit and Collections Firm D. Lee shared that APU was recognized by Katella High School, who was the winner of the California Green Ribbon Schools Awards, for providing opportunities for students to move towards STEM -based sustainability careers through APU's mentoring program. D. Lee gave an update on several neighborhood meetings that took place, including one at the Guinida Resource Center and one at the Miraloma Family Resource Center. APU staff was available to discuss a variety of programs and provided drought information to the community. D. Lee shared information on APU's first annual Employee Family day. This event was a great way for employees' families to see what their family member does at work. D. Lee shared photos of families who participated in Little People's park clean up and subsequent tours of facilities. D. Lee requested that the Board close the meeting in memory of Paul Gafner, retired Water Systems Operator, who had recently passed away. J. Dulebohn, Water System Operator Superintendent, shared his thoughts and sentiments about P. Gafner and described him as someone who dedicated his life to the people of Anaheim as a water advocate and hard worker. 14. ITEMS BY BOARD MEMBERS. M. Lee thanked APU and shared that each presentation given was good, precise, professional, and he enjoys coming to the meetings. N. Campos Kurtz shared that she attended both the Farmers Market and Boysen Park events and commented that the staff who assist with the events are patient with the public. N. Campos Kurtz also thanked APU for providing her with information about the street markings in her neighborhood. 2022 - 40 A. Abdulrahman thanked staff for the Magnolia Power Plant tour that he attended. Chairperson J. Seymour called for a minute of silence in memory of Paul Gafner and then sought a motion to adjourn the meeting in his memory. 15. ADJOURNMENT: (NEXT REGULAR MEETING ON JUNE 22, 2022 AT 5:00 P.M.) Re ectfully su mitted, Dukku Lee Public Utilities General Manager N. Campos Kurtz moved to adjourn the Regular Meeting in Gordon Hoyt Conference Center at 6:58 p.m. to the Board's Regular Meeting date of June 22, 2022 at 5:00 p.m. R. Bhalla seconded the motion. MOTION CARRIED: 7-0. ABSTAINED: 0. ABSENT: 0. * Indicates item(s) that will be forwarded to City Council for action upon recommendation by the Board. ** Indicates item(s) that will be forwarded to City Clerk and City Council for informational purposes. 2022 - 41