Public Utilities 2023/04/26CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
April 26, 2023
The agenda having been posted on Thursday, April 20, 2023, the Regular Meeting of the Public Utilities
Board (Board) was called to order by Chairperson Seymour at 5:00 p.m. on Wednesday, April 26, 2023,
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 A. Abdulrahman, M. Lee,
A. Pham, A. McMenamin, T. Bilezikjian, T. Ibrahim
Board Members Absent: None
City Staff Present: D. Lee, A. Kott, P. Starr, J. Lehman, J. Lonneker, C. Parker, M. Seifen,
J. Sanks, T. Castaneda, E. Krause, T. Chen, A. Nguyen, C. Thompson,
M. Jouhari, Y. Saldivar, M. Pan
Guest(s) Present: Vincent Baroldi
AGENDA ITEM ACTION TAKEN
V. Baroldi was recognized for his service as Vice -Chairperson of the
Public Utilities Board. While on the Board, V. Baroldi participated in
Board recognitions of students and schools, and supported projects and
programs that benefit the community. V. Baroldi thanked fellow Board
Members and staff for the recognition and expressed that he
appreciated his time on the Board.
D. Lee, Public Utilities General Manager, recognized M. Jouhari,
Water Field Operations Manager, who is retiring at the beginning of
May. M. Jouhari shared his gratitude for working with Anaheim
Public Utilities (APU) for 28 years, and that he will miss the work, but
plans to enjoy retirement.
The Board wished V. Baroldi and M. Jouhari well.
1. PUBLIC COMMENTS. There being no electronic or
oral public comments,
Chairperson J. Seymour
closed the public comments
of the meeting.
2023 - 30 ITEM 9 01
2. APPROVAL OF THE MINUTES OF THE PUBLIC UTILITIES
BOARD REGULAR MEETING OF MARCH 22, 2023.
3. PRESENTATION: FISCAL YEAR 2023/24 STRATEGIC
BUDGET PROPOSAL.
A. Nguyen, Utilities Financial Planning Manager, presented an
overview of the strategic budget proposal including the planning
process, vision and mission statement, strategic priorities and budget
terminology. He discussed APU's revenue and expense projections for
Fiscal Year (FY) 2022/23, explaining that the largest variances in
revenue were due to higher electric retail sales and more Orange
County Water District (OCWD) reimbursements. A. Nguyen also
explained that multi -year capital projects are carried over into the
proposed FY after budget adoption.
A. Nguyen displayed a short video highlighting current -year initiatives
and projects that align with APU's strategic priorities. Following the
video, he reviewed the FY 2023/24 proposed revenue and expenditures,
outlining an increase in electric revenue due to slightly higher demand
and a decrease in OCWD reimbursements as groundwater treatment
projects near completion.
The operating budget was then reviewed, A. Nguyen noted an increase
in supplies and equipment due to the operating and maintenance of the
new groundwater treatment facilities. He highlighted a decrease in
water supply and debt service costs due to increased groundwater
pumping and refinancing efforts from the prior year.
A. Nguyen reviewed projects and initiatives that support APU's
strategic priorities including system inspections, fleet electrification,
technology upgrades, electric and water capital upgrades, renewable
power supplies, and community and sustainability programs.
A. Nguyen made the Board aware of the next steps of the budget
process including community district meetings, City Council
workshops, budget adoption, and the Utilities Success Indicators report.
The Board asked about funding sources in the budget and the structure
of community district meetings. D. Lee explained various efforts to
pursue large funding sources to offset the costs of proposed initiatives,
and that awarded grant funding would be captured in the budget. He
A. Pham moved the
approval of the Minutes of
the Public Utilities Board
Meeting Regular Meeting of
March 22, 2023. M. Lee
seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
2023 - 31
also explained how community district meetings are an opportunity for
residents to ask questions about city department budgets.
The budget recommendation on the Proposed budget will be sought at
the May Board meeting, and Board members were encouraged to ask
questions of staff in the interim.
4. APPROVE AND ADOPT THE 2023 INTEGRATED RESOURCE
PLAN (IRP) FOR THE CITY OF ANAHEIM, INCLUDING THE
RENEWABLE ENERGY PROCUREMENT PLAN AND
ENFORCEMENT PROGRAM; AND AUTHORIZE THE PUBLIC
UTILITIES GENERAL MANAGER OR DESIGNEE(S) TO TAKE
ALL ACTIONS AS ARE NECESSARY OR ADVISABLE TO
IMPLEMENT THE 2023 IRP, CONSISTENT WITH THE
MANDATES OF CALIFORNIA STATE LAW.
A. Abdulrahman moved the
Approval and Adoption of
the 2023 Integrated
Resource Plan for the City
of Anaheim.
T. Bilezikjian seconded the
motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
C. Thompson, Principal Integrated Resources Planner, described the ABSENT: 0.
current Integrated Resource Plan (IRP) and explained that the
development and approval of the IRP is a statutory requirement that
must be completed no less than once every five years. The IRP is a
long-term strategic planning document that outlines what APU's power
supply mix will look like in the future taking into consideration
California's environmental policy goals and the effects of energy
efficiency, distributed energy, and electrification efforts on customer
demand.
M. Pan, Principal Integrated Resources Planner, presented the results of
the modeling analysis that went into the selection of the optimal
portfolio that will meet APU's planning and environmental policy
goals. M. Pan began with a discussion of how the demand forecast and
supply mix was determined considering APU's planning goals for
sustainability, reliability, and affordability. M. Pan then discussed the
various options that were analyzed that will gradually reduce reliance
on natural gas over time to meet the State's policy goal of carbon -free
by 2045. D. Lee expanded on the discussion of cost comparison for
each portfolio option, and explained there are still uncertainties and
significant dollars in play over the time horizon to keep up with
renewable investments, market risk, and divesting of natural gas over
time.
C. Thompson explained APU's customer engagement mainly through
customer surveys and discussed some highlights, such as high marks
for reliability, safety, and value, consistent with the 2018 survey. C.
Thompson also addressed how APU is supporting environmental
justice, and what types of offerings the utility is providing to alleviate
not just affordability issues, but also the health and environmental
burdens that low-income and disadvantaged communities face. The
Board asked about Renewable Natural Gas (RNG) and its meaning. D.
Lee explained that it is produced from fuels, such as green waste. The
Board asked whether hydrogen is considered renewable. D. Lee
2023 - 32
explained that it depends on if it is produced from renewable energy or
from fossil fuels.
The Board asked if RNG will count toward the 2045 goal. D. Lee
explained that that it could, but there is regulatory uncertainty as a
long-term investment, which is why APU takes that risk into
consideration during the evaluation process. The Board requested that
APU make them aware if the definition or classification of RNG
changes prior to the next IRP update.
The Board asked what would result if changes, at the State level,
occurred to environmental policies currently in place. D. Lee explained
that while things often change, APU would likely remain on the same
pathway and try not to be too reactionary, as the State has been moving
in this direction for over 20 years.
5. APPROVE AND AUTHORIZE THE POSTING OF THE 2023
WATER QUALITY REPORT ON THE ANAHEIM PUBLIC
UTILITIES WEBSITE AND THE PROVIDING OF A
CERTIFICATION OF COMPLETION OF POSTING TO THE
STATE WATER RESOURCES CONTROL BOARD DIVISION
OF DRINKING WATER.
J. Lehman, Assistant General Manager — Administrative and Risk
Services, shared the 2023 Annual Water Quality Report (WQR)
detailing that APU either met or exceeded all federal and state water
quality requirements. J. Lehman requested the Board's approval to post
the WQR on APU's website and certify to the State Water Resources
Control Board (State Water Board) when the posting was completed.
J. Lehman noted that the State Water Board's Division of Drinking
Water issued to APU a violation in October 2022 due to untreated
water at four well sites that was not tested for total coliform in a timely
manner. The wells were offline due to maintenance and were not tested
at their regular quarterly interval by October 3Pt. When the discrepancy
was discovered on November 1 lth, the wells were immediately
sampled. Samples were taken both before and after the missed sample
period, and these met the water quality standards. No untreated water
was served to customers. APU is working on measures to improve
sample tracking.
The Board inquired if they could be made aware of any other water
contaminants that are like PFAS that may be an issue soon. J. Lehman
responded that State testing for unregulated contaminants is continuous.
D. Lee added that several of the approximately 5,000 chemicals in the
same family as PFAS are currently regulated, and additional PFAS
contaminants will be regulated in the future. Other types of
contaminants include microplastics and volatile organic compounds
(VOCs) as result of industrial manufacturing. As more contaminants
M. Lee moved to Approve
and Authorize the Posting of
the 2023 Water Quality
Report to the Anaheim
Public Utilities Website.
A. McMenamin seconded
the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
2023 - 33
are eventually regulated, APU's systems will be able to adapt to future
requirements.
The Board asked if APU's water quality complies with or exceeds
Federal standards. D. Lee confirmed that the water for the City of
Anaheim either meets or exceeds Federal and State standards.
6. QUARTERLY STATUS REPORT FOR PRE -QUALIFIED
PROFESSIONAL SERVICES, CONSTRUCTION, AND SPOT BID
ELECTRIC MATERIAL PURCHASES FOR THE QUARTER
ENDING ON MARCH 31, 2023.
J. Lonneker, Assistant General Manager — Electric Systems, shared
with the Board that several projects using the Design -Build Master
Agreement (DBMA) method are underway within the Electric Division.
The DBMA is a useful method for completing large scale infrastructure
replacement projects such as transformer and direct buried cable
replacement work. J. Lonneker also raised concerns about procurement
of materials for projects due to supply -chain issues and internal
processes. Equipment manufacturers are unable to provide a fixed price
per unit for equipment whose components are subject to price volatility
due to supply -chain constraints and rising material costs, which is not
consistent with Council policies and Anaheim's standard terms and
conditions. This is causing a delay in material procurement and has
resulted in project delays. J. Lonneker highlighted several capital
projects underway including trenching along Ball Road for an electric
line extension project, and pole replacement work as part of the
ongoing infrastructure replacement program.
C. Parker, Assistant General Manager — Water Services, highlighted the
water capital projects, such as the Groundwater Treatment Project
(GWTP) and several pipeline projects. The GWTP is proceeding on
schedule to start producing water at all sites by Fall 2023. The water
capital projects are on track to be completed as per the budget.
D. Lee shared that the procurement issues are having a detrimental
impact on APU's ability to improve reliability. As an example, the lack
of transformers has resulted in limiting capital projects, refurbishing
existing transformers, and drawing down inventory levels. APU is
evaluating alternative approaches to equipment procurement to leverage
economies of scale with other public utilities. The Board stated they
want staff to continue working on potential solutions to this issue. The
Board inquired about different suppliers, and staff responded that they
are looking at alternative suppliers and discussing vendor options with
other utilities.
7. UPDATE ON ELECTRIC SYSTEM ITEMS.
J. Lonneker provided the Board with information regarding recent
power outages. There were approximately five smaller outages due to
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mylar balloons. APU will be releasing a public service announcement
regarding mylar balloons as we near graduation season.
J. Lonneker shared information with the Board about a power outage
that occurred due to a vehicle crashing into an electric pole. This
accident tripped the entire circuit and caused an outage for
approximately 1,800 customers. APU operations staff were able to
redistribute power and lower the number of customers experiencing the
outage to 40 within one hour of the crash.
J. Lonneker also made the Board aware of a pole replacement on
Webster Avenue. The inspection required immediate response, and
ultimately three poles were replaced. J. Lonneker shared with the Board
that at next month's Board Meeting there will be an Agreement for
Overhead Infrastructure Inspection, which will help with pole
inspection and replacement.
Lastly, J. Lonneker discussed the annual Hurt Man Rescue training and
certification at the Edwards Utility Center. Line mechanics,
apprentices, and troubleshooters partake in this training.
8. UPDATE ON WATER SYSTEM ITEMS.
C. Parker, Assistant General Manager — Water Services, indicated that
the water supply condition has improved drastically since last year.
The groundwater basin is in good condition and the State Water
Project is now going to provide a full allocation to all parties. The
Colorado River has an above average snowpack, which will raise Lake
Mead by 20 to 25 feet after the snow melts. There is still a structural
deficit on the Colorado River, but these new levels will provide more
time for all parties along the river to determine the best path forward
for future allocations that are sustainable.
C. Parker also discussed the Groundwater Replenishment System
(GWRS) Final Expansion Dedication that took place by OCWD and
Orange County Sanitation District (OCSD). The project is now
recycling all reclaimable wastewater in the county. This provides over
130 million gallons per day for recharge and the seawater barrier in the
OC Basin.
The Board inquired about dam safety with the high-water levels. C.
Parker explained that dams are designed with high safety margins
because of the implications of a dam failure.
9. UPDATE ON FINANCE & ENERGY RESOURCES ITEMS.
E. Krause, Integrated Resources Manager, discussed the monthly
finance dashboard. He shared that year-to-date electric revenue was
12.7% ($38.6M) above budget due to higher than projected Retail
2023 - 35
Revenue, while Wholesale Revenue came in line with Budget. Electric
operating costs remained 12% ($36.3M) above budget.
E. Krause then reviewed the water dashboard expenses and shared that
the year-to-date water expense was 4.1% ($58.6M) below budget.
March expenses were reduced due to a Metropolitan Water District
(MWD) pipeline maintenance outage which lasted two weeks but is
now back in service. Water revenue was 3.7% ($2.8M) below budget
due to the drop in water consumption by APU customers because of
conservation in response to the drought, followed by the reduced
outdoor water use due to recent rainfall. However, with drier weather
approaching, water use may increase for such things as landscaping.
E. Krause discussed the Power Supply Dashboard and mentioned the
Intermountain Power Project (IPP) reduced capacity remains in effect;
however, coal allocations will provide for an increase in June with full
operation expected by summer. He elaborated on the increases in water
flows as mentioned in the Water Updates will result in higher levels of
hydro power; with the abundance of hydro power paired with solar
production, there could be negative pricing. In addition, gas prices
remained elevated despite a low in January.
10. UPDATE ON ADMINISTRATION & RISK SERVICES ITEMS.
J. Lehman, Assistant General Manager — Administrative and Risk
Services, shared that because there may be insurance implications, an
outside entity would be investigating the backhoe fire that occurred in
March and that an update would be provided to the Board upon
completion of the report.
J. Lehman discussed the Administration and Risk Services Dashboard,
then provided the Board with the safety metrics and highlighted that all
targets had been met.
11. ITEMS BY SECRETARY.
D. Lee shared that an overview of the Board will be provided to City
Council on May 16''.
Agenda items planned for next month:
• Fiscal Year 2024 Proposed Budget
• Green Power Update
• Design -Build Agreement for Sustainability Education Center
• 2023 Power Supply Summer Outlook
• 2023 APU Wildfire Mitigation Plan and Independent Evaluator's
Report
2023 - 36
APU staff provided a tour for Council Member C. Leon at two
groundwater treatment plants, the Canyon Power Plant, and Canyon
Substation.
APU held a cleanup event at Peralta Canyon Park. APU employees
helped Community Service's Park Division by cleaning and painting
picnic tables, spreading mulch in playgrounds, and planting trees.
APU participated at multiple community engagement events, including
a lighting installation on Bush Street attended by Mayor Pro Tem N.
Rubalcava. Residents expressed their appreciation for the new lighting
that was installed. Another lighting installation took place at Rancho La
Paz Mobile Home Park. These community engagement events have
provided an opportunity for staff to not only help with lighting but offer
bill assistance and weatherization information to residents.
M. Avelino -Walker, General Services Manager, highlighted the 16
student winners of the Water Poster Contest. Over 300 entries were
received this year during Water Awareness Month. The winners were
recognized for their artwork at the Honda Center.
In celebration of Earth Day, APU partnered with Juarez Elementary
School and had 41h and 5th grade students participate in planting a tree
on campus. Mayor A. Aitken and Council Member S. Faessel both
attended this event.
APU staff partnered with an AP Environmental Science teacher at
Loara High School to provide STEM education to students on electric
vehicles. Students received solar car kits that demonstrate this
technology and were also given a tour of an electric APU vehicle.
APU sponsored the STEAM-a-Palooza Solar Powered Car Race event
at Loara High School. Each year, Anaheim Union School District
invites all High Schools and Junior High Schools to select one teacher
to choose students who will build and race solar powered cars using
materials provided by APU. First and second place prizes were awarded
to the students.
Lastly, D. Lee shared photos of Congressman L. Correa presenting city
and school dignitaries, along with students and APU with a check for
$3 million in Federal funding for the Sustainability Education Center.
12. ITEMS BY BOARD MEMBERS.
Board Member T. Bilezikjian thanked APU staff for their assistance in
identifying options for electric vehicle charging at her home. She then
asked if APU has experienced any legal issues over the use of utility pole
treatments, as Pacific Gas and Electric (PG&E) and Southern California
Edison (SCE) recently have experienced. D. Lee, Public Utilities General
Manager, responded that there have been no lawsuits that APU staff is
2023 - 37
aware of; J. Lonneker added that pole treatment manufacturers are
working on developing a more environmentally conscious treatment, and
that current APU RFPs require environmentally sensitive chemical
treatment. J. Lonneker will review this issue and provide an update
during next month's pole inspection agenda item. Board Member T.
Bilezikjian also asked if the high -traffic corner of Claudina Street and
Santa Ana Street near the Packing House could be inspected for
additional lighting.
Board Member A. Pham expressed appreciation for APU's community
outreach. He attended both the Children's Water Festival and Water
Poster Recognition Contest.
Board Member M. Lee thanked M. Avelino -Walker and her team for
their hard work in preparation for the Sustainability Education Center
event.
Vice -Chairperson A. Abdulrahman expressed appreciation to APU staff
for their work on Capital Improvement Projects, despite numerous
challenges.
13. ADJOURNMENT: (NEXT REGULAR MEETING ON
MAY 24, 2023, AT 5:00 P.M.)
RFsp ctfully s i itted,
Dukku Lee
Public Utilities General Manager
Staff will review pole
treatment and associated risk
exposure, as well as street
lighting at the intersection of
Claudina Street and Santa
Ana Street.
Chairperson J. Seymour
moved to adjourn the
Regular Meeting in the
Gordon Hoyt Conference
Center at 7:19 p.m. to the
Board's Regular Meeting
date of May 24, 2023 at
5:00 p.m. T. Bilezikjian
seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 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 the City Clerk and City Council for informational purposes.
2023 - 38