Public Utilities 2024/04/24CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
April 24, 2024
The agenda having been posted on Wednesday, April 17, 2024, the Regular Meeting of the
Public Utilities Board (Board) was called to order by Chairperson J. Seymour at 5:00 p.m. on
Wednesday, April 24, 2024, in the Gordon Hoyt Conference Center, 2 d floor, Anaheim West
Tower, 201 S. Anaheim Blvd., Anaheim, California.
Board Members Present: Chairperson J. Seymour, Vice -Chairperson A. Abdulrahman,
M. Lee, A. Pham, T. Bilezikjian, T. Ibrahim, A. McMenamin
Board Members Absent: None
City Staff Present: D. Lee, P. Starr, J. Lonneker, J. Lehman, C. Parker, M. Avelino -
Walker, T. Castaneda, A. Lee, T. Chen, A. Nguyen, Y. Saldivar,
C. Pereyra, K. Meland, M. Seifen, F. Nocella, C. Nelson,
G. Zaragoza, I. Oseguera, B. Mendoza, A. De La Paz
Guest(s) Present: Susan Nocella, Frank Nocella Jr., Lizeth Luciano
AGENDA ITEM ACTION TAKEN
1. PUBLIC COMMENTS.
2. APPROVE THE MINUTES OF THE REGULAR MEETING
OF MARCH 27,2024. *
T. Castaneda, Community and Sustainability Programs Manager,
recognized the valuable contributions of the Tree Power Program
and its dedicated staff members. T. Castaneda shared the program's
history, stating that it was initiated 32 years ago through a
collaboration between Anaheim Public Utilities (APU) and the
Community Services Department, with the goal to provide
residents, schools, and businesses with shade trees to help save
energy. Tree canopies block sunlight from buildings, lowering air
There being no electronic or
oral public comments,
Chairperson J. Seymour closed
the public comments portion of
the meeting.
T. Ibrahim moved the Approval
of the Minutes of the Regular
Meeting of March 27, 2024.
A. McMenamin seconded the
motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
2024-29 ITEM 9 03
conditioner usage by as much as 40 percent, and cutting irrigation
needs up to 50 percent.
Through the program, residents and businesses can receive up to six
trees at no cost, along with complimentary delivery and planting
guidance. T. Castaneda shared the accomplishments of the program,
including the planting of 58,000 trees since program inception, an
average of 1,800 new trees planted annually, and the 49 varieties of
tree species offered including shade trees, fruit trees, and fire-
resistant tree species.
T. Castaneda stated that the Tree Power program staff members
help address water waste inquiries, engage with residents at
community fairs, educate students, and support APU's annual Earth
Day Tree Planting event. The City of Anaheim (City) is nationally
recognized as part of the Tree City USA program by the Arbor Day
Foundation, and the Tree Line USA program.
T. Castaneda recognized City staff members of the Tree Power
Program including Clare Nelson, Frank Nocella, Alejandro Ruiz,
German Zaragoza, and Ignacio Oseguera.
4. APPROVE IN SUBSTANTIAL FORM AN ENERGY
STORAGE AGREEMENT WITH ROADHOUSE ENERGY
STORAGE, LLC (ROADHOUSE) FOR THE PURCHASE OF
ENERGY, CAPACITY, RESOURCE ADEQUACY, AND
ASSOCIATED ATTRIBUTES FROM A 300 MEGAWATT
BATTERY ENERGY STORAGE SYSTEM THAT WILL BE
DESIGNED, CONSTRUCTED, OWNED, AND OPERATED
BY ROADHOUSE FOR AN APPROXIMATE COST OF $67.5
MILLION PER YEAR OVER A TWENTY-YEAR DELIVERY
TERM. *
E. Krause, Integrated Resources Manager, briefed the Board on the
Energy Storage Agreement for the Roadhouse Energy Storage
project, which would be added to the resource portfolio to aid in
further integration of renewable resources. APU has been analyzing
utility -scale batteries and developing a plan to optimize the
operational and financial benefits that facilitate the transition to
cleaner energy resources. E. Krause explained that Energy Storage
was identified in the Integrated Resources Plan, which was
approved by the Board and Council and submitted to the State the
prior year, as a way to manage intermittent resources like wind and
solar.
APU looked at the option of installing and owning an Energy
Storage system in Anaheim and put a bid out to energy storage
developers. The cost was much higher than originally estimated and
there are some space and local grid constraints if installed in
Anaheim. As a result, APU issued a Request for Proposals (RFP) to
see if a developer -owned solution would be more viable.
T. Bilezikjian moved the
Approval of an Energy Storage
Agreement with Roadhouse
Energy Storage, LLC.
A. Abdulrahman seconded the
motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
2024 - 30
E. Krause explained that the Roadhouse Battery Energy Storage
system, developed by NextEra Energy Resources, would be located
in Ontario, California. 'rbis Energy Storage project would provide a
local resource of 300 Megawatts (MW) and would line up well with
the exit from the Intermountain Power Prq�ject coal resource in the
same 2027 timeframe. The project provides perfonnance
guarantees, and decommissioning responsibility would remain with
the developer.
E. Krause explained Calitiomia, Independent System. Operator's
(CAISO) recent battery dispatch examples. Battery dispatch fear a
normal Monday shows battery discharge in. the moming and
evening hours with the majority charging mid -day during solar
hours, The recent solar eclipse was also reviewed showing battery
discharge during the hours of the eclipse as well. The battery
dispatch is expected to be similar to the examples and would be
dispatched by the CAI SO.
E. Krause mentioned that a third -party energy consulting finu aided
with the evaluation due to the cost of the agreement, The goal is to
make sure that there is a benefit not only for operational purposes,
but to keep customer rates affordable. It is anticipated. that the cost
of the agreenient, plus the cost of energy to fill the batteries will be
offset by the annual revenues associated with the wholesale market
and avoided grid costs paid as a participant in the CAISO. The
resulting net benefit is about $7 million per year-, which may be
used to invest in additional renewable resources in the future.
The Board inquired if AICU was the sole off taker for the resource.
E. Krause informed the Board that the resource was submitted
through an RFP and that APU is the sole off taker for the prqject.
The Board inquired if APU operators were dispatching the battery
resource. E. Krause explained that the CAISO would dispatch the
battery based on system needs. A. Nguyen, Financial Planning
Manager, added that the resource had secured deliverability status
within the CAISO and that many resources offered do not have this
status.
The Board inquired if 300 MW would be delivered each day. D.
Lee, public Utilities General Manager, explained. that dispatches
may be for the full 300 MW or something less; this will depend on
the State's need at that time and sirnilar to how CanyonPower Plant
is dispatched to meet regional grid needs,
The Board asked if the battery would always be fully charged or
something less due to the efficiency seen in the contract. D. 1.ee
explained that the optimal rate will be deterrained between A.PLJ
staff and the developer to find the optimal charge and discharge
rate. E, Ki-ause added that there is a 50% average State of Charge
allowed, and this would allow for a full charge and discharge each
day.
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5. APPROVE A PROFESSIONAL SERVICES AGREEMENT
WITH BARINGA PARTNERS, LP FOR PROJECT
MANAGEMENT SERVICES ON THE IMPLEMENTATION
AND SOFTWARE INTEGRATION OF AN ENERGY
TRADING AND RISK MANAGEMENT SYSTEM. *
E. Krause briefed the Board on a Project Management Services
Agreement for the Energy Trading and Risk Management System
(ETRMS) to manage interfaces with the regional wholesale energy
market. E. Krause shared a video clip produced by CAISO that
provides a high-level summary of the regional grid. Anaheim is a
member of the CAISO so it's imperative that any solution we
procure works seamlessly with them. E. Krause explained how the
grid has become more complex and expanded through the Energy
Imbalance Market along with the abundance of Variable Energy
Resources. As such, there are gaps when APU either has too much
or too little supply to meet customer demand.
The ETRMS utilizes high volumes of data related to power
supplies, their costs, customer demands, and related risks and runs
them through algorithms, and those results allow resource planners
to make informed decisions to fill those gaps and schedule and bid
resources to offer generation to the CAISO. Any savings through
the wholesale markets help to keep electric rates affordable.
E. Krause explained that the grid has much more variability in
terms of the types of resources, geographic diversity, and their
operating characteristics that helps to mitigate associated risks. The
current ETRMS system is 17 years old and there are many reports
which require Microsoft Excel to compile the data. To implement
the new system, it is necessary to contract a Project Manager to
implement the new system, handling all aspects of transitioning
from the old to the new without disrupting daily operations.
A summary of the competitive solicitation was provided, showing
that the selection of the professional consultant followed Council
Policy 4.1 and based on similar experience, technical approach,
qualifications of individuals performing the work, and
reasonableness of fees. E. Krause elaborated that seven proposals
were submitted, two were shortlisted to conduct further interviews
and questions. Baringa Partners LP is recommended based on their
ranking. The cost of the proposal is $2.1 million and there is a 15%
contingency added for as -needed services as the system is
implemented.
The Board inquired if the Project Manager (PM) was bundled with
the software. E. Krause explained that the software would be
brought later for Board recommendation and City Council approval
and the PM is needed to integrate the new system as well as finalize
scope for the new system. The Board inquired if APU needed to let
the CAISO know that a new system is being put into place.
A. McMenamin moved the
Approval of a Professional
Services Agreement with
Baringa Partners, LP.
M. Lee seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT: 0.
2024-32
E. Krause elaborated that the C AlS0 does not need to know for this
project. The system is used to interface with CAISO systems.
The Board inquired if the system would be compatible with others.
E. Kxause explained that AP(J would be replacing the entire system,
and it would be combination of "off the shelf' modules for most
scheduling aspects. Ilowever, there may need to be some
customizationf'or reporting aspects of the system,
6. PRESENTATION: FISCAL Y"EAR 2024/25 STRATEGIC
BUDGET SAL®
C.Pereyra, Budget and Perfonnance Administrator, briefed the
Board on the Fiscal Year (FY) 2024/25 Strategic Budget Proposal,
beginning with an overview of strategic priorities and the budget,
cycle. C. Pereyra shared how current year projections for electric
retail sales were below the forecast due to decreased demand from
cooler temperatures. C. Pereyra also indicated that increases it]
water supply costs were offset by corresponding savings in supplies
and equipment expenses, and how funds for multi -year projects
would be carried over into the new fiscal year.
The proposed increase in electric retail revenue would be offset by a
decrease in the ainount of rate stabilization fiends collected, C.
Pereyra shared that less proposed water revenue was primarily due
to fewer reimbursements, as groundwater treatment projects near
completion. Explaining the increase in labor, C. Pe.reyra. noted that
the proposed budget reflects recently approved labor contracts that
were not included in the prior budget, and that the headcount will
remain flat. C. Pereyra discussed increases in supplies and
equipment due to technology projects and community and
sustainability programs, as well as increases in power supply costs
to purchase more renewable energy.
C. Pereyra. outlined key budget investi-nents that aligm with A?Us
strategic priorities, including technology projects, security
hardening, energy and water efficiency progranis, and capital
infrastructure projects. C. Pereyra shared that the budget will be
agendized at the next Board meeting for recommendation to the
City Council. D. Lee informed the hoard that staff will be available
to answer any questions about the budget prior to the next meeting.
7. APPOINTMENT OF UP TO 3 MEMBERS TO THE
BarTLED WATER ART AD HOC SELECT110N
COMMITTEE.
APIJ is seeking tip to three Board Members to volunteer to serve on
the Bottled Water- Art ad hoe Selection Committee. Board l ein.bers
T, Ibrahim, A. McMenamin and A. Pliam volunteered. Chairperson
J. Seymour confirmed their appointments to serve on the Bottled
Water Aft ad hoc Selection Committee.
8. APPROVE AND AUTHORIZE THE POSTING OF THE 2024
WATER QUALITY REPORT ON THE ANAHEIM PUBLIC
UTILITIES WEBSITE AND PROVIDING OF A
CERTIFICATION OF POSTING TO THE STATE WATER
RESOURCES CONTROL BOARD DIVISION OF DRINKING
WATER.
J. Lehman, Assistant General Manager — Administration and Risk
Services, shared the Annual Water Quality Consumer Confidence
report (Report) detailing that APU either met or exceeded all
federal and state water quality requirements. J. Lehman highlighted
that over 40,000 water quality tests are performed each year to
ensure the integrity of the water provided to the community. J.
Lehman requested the Board's approval to post the Report on
APU's website and certify to the State Water Resource Control
Board when the posting was completed.
9. PRESENTATION: CITYWIDE STRATEGIC PLAN.
D. Lee provided an overview of APU's involvement in the
Citywide Strategic plan that was adopted by City Council. There are
several areas and goals that APU will be focusing on.
D. Lee shared details on APU involvement including enhancing
livability, graffiti abatement on utility equipment, tree trimming
around utility lines, and expanding mobile services to better serve
the community, including rebates to businesses.
Two areas that APU will be leading include helping customers
address non-functional turf replacement due to drought regulations
and seeking external funding sources to underground roadways with
Southern California Edison (SCE) power lines.
10. QUARTERLY STATUS REPORT FOR PRE -QUALIFIED
PROFESSIONAL SERVICES, CONSTRUCTION, AND SPOT
BID ELECTRIC MATERIAL PURCHASES FOR THE
QUARTER ENDING ON MARCH 31,2024.
J. Lonneker, Assistant General Manager — Electric Services,
updated the Board on the Electric Quarterly Status Report and
informed the Board that APU is coordinating with the Public Works
Department (PW) to request proposals from additional firms for
consideration to be added to the Design -Build Master Agreement
(DBMA) pre -qualification list. J. Lonneker commented on the need
to add firms to foster more competitive bids on projects, noting that
several projects had a single bidder in the past 12 months. J.
Lonneker shared that a large capital improvement project, that has
extensive high voltage line extension work, would be going to City
Council for approval in May to support additional development in
the Platinum Triangle area.
T. Bilezikjian moved the
Approval and Authorization of
the Posting of the 2024 Water
Quality Report.
M. Lee seconded the motion.
MOTION CARRIED: 7-0.
ABSTAINED: 0.
ABSENT:O
2024-34
C. Parker, Assistant General Manager — Water Services, updated
the Board on the Water Capital Improvement Program, and shared
that the planned projects will be completed by the end of the fiscal
year. C. Parker stated that the Boysen Park Groundwater Treatment
Plant recently became operational and Phase A Groundwater
Treatment Plants are all operational now. Phase B Groundwater
Treatment Plants, including the Katella Well that is located near
Angel Stadium, is now operational; the Downtown Well located
near the Anaheim Packing House, will be operational in May, and
the remaining sites will be operational in June 2024. All remaining
work for both phases will be done by the fall timeframe.
11. UPDATE ON ELECTRIC SYSTEMS ITEMS.
J. Lonneker informed the Board of a power outage that occurred
April 15, 2024, at approximately 7:45 pm. This outage affected
approximately 2,700 customers near Downtown Anaheim and north
of the Resort district. Field personnel encountered issues with
automation technology and deployed manual procedures resulting
in a longer duration outage. Most customers were restored within a
few hours, however, about 125 customers experienced an outage
into the next day and will receive bill credits for the long duration
outage. J. Lonneker shared with the Board that a resident from
District 4 messaged APU inquiring when power would be restored.
APU staff provided the resident with a portable battery generator to
power a microwave needed to warm up an infant's bottle.
J. Lonneker reminded Board Members of the Institute of Electrical
and Electronics Engineers (IEEE) Power & Energy Society (PES)
Transmission and Distribution Conference and Exhibition at the
Anaheim Convention Center from May 6_91h.
J. Lonneker requested the Board members inform P. Starr,
Executive Assistant, if interested in attending.
The Board inquired about the blue and white lights that were
recently installed on light poles on Nohl Ranch Road in Anaheim
Hills. D. Lee shared that this is possibly an initiative from the
Anaheim Police Department to deter wire theft.
12. UPDATE ON WATER SYSTEMS ITEMS.
C. Parker briefed the Board on the Water Supply Condition, stating
that the Orange County Groundwater Basin is in good condition and
had above average rain fall this year. Most of the rain was captured
and recharged into the groundwater basin. The State Water Project
(SWP) had slightly under average rain fall and about average snow
fall. The state recently announced that a 40% allocation on the SWP
will be implemented this year, allowing for the Metropolitan Water
District of Southern California (MWD) to put more water in storage
this year. The Colorado River Basin had an under average rain fall
and about average snow fall this year.
APU staff will follow up with
the Board.
2024-35
C. Parker invited the Board to the American Water Works
Association's (AWWA) Annual Conference at the Anaheim
Convention Center in June. C. Parker requested the Board Members
inform P. Starr if interested in attending.
C. Parker briefed the Board on a pipe break that occurred at the
beginning of April. Staff worked long hours fixing the challenging
break due to two gas lines and one telecommunication line in close
proximity to APU's water line.
C. Parker shared information and a video on a pipe cutting machine
utilized by staff to cut pipes up to 72 inches in diameter. The
machine is more efficient, safer and provides higher quality than
other machines.
13. UPDATE ON FINANCE AND ENERGY RESOURCES ITEMS.
A. Nguyen shared the Finance Dashboard with the Board, noting
how cooler temperatures and precipitation affected fiscal year-to-
date electricity and water sales. A. Nguyen noted that electric and
water expenses are under budget for similar reasons. A. Nguyen
shared recent supply -chain related headlines, indicating how
electrification efforts, regulatory risks, and climate change events
continue to challenge the utility industry's ability to receive timely
delivery of equipment.
14. UPDATE ON ADMINISTRATION AND RISK SERVICES
ITEMS.
J. Lehman shared the Administration and Risk Services Dashboard.
J. Lehman reviewed the safety metrics, and shared that APU
received the national safety award from the America Public Power
Association (APPA). The safety award of excellence was awarded
for exemplary safety practices in 2023, based on incident rates, and
overall safety programs, culture and practices. J. Lehman shared
two other awards from the National Safety Council. One was a
safety leadership award for the Lenain Water Treatment Plant for
five consecutive years with no injuries resulting in days away from
work. The other was the Superior Safety Performance award for the
Canyon Power Plant for having ten consecutive years with no
injuries resulting in days away from work.
15. ITEMS BY SECRETARY.
D. Lee shared agenda items planned for next month:
Fiscal Year 2025 Proposed Budget
Wildfire Mitigation Plan Update
Design Build Agreement
Water Bond Issuance
2024-36
D. Lee shared photos and various updates from the last month,
including:
A resident tour with Board Member M. Lee with college
students and Anaheim residents
• Neighborhood meetings where APU shared about lighting
programs
• APU staff joined Board Member A. Pham with the West
Anaheim Organization event to provide resources for
residents on various APU programs
• P. Garcia, Water Field Superintendent, performed above and
beyond his job duties during a water main break by helping
residents to safely cross the street
• Mayor Ashleigh Aitken and the Anaheim Ducks recognized
students for their involvement in the Water Poster Contest
® An Earth Day tree planting ceremony was held at Orange
Grove Elementary School
Anaheim Union High School District hosted their annual
STEAM-a-Palooza, and APU and Board Member T. Ibrahim
recognized students who won a battery car race
Lastly, D. Lee requested that the Board meeting be closed in
memory of Wayne Barlow, a former APU Chief System Operator
from 1980-2010.
iI �#' u �3-1 �Z
Board Member A. Pham thanked APU staff for attending the West
Anaheim Events and the Community Resource Fair and EV Test
Drive.
M. Lee thanked APU for supporting the resident tour.
22,2024, AT 5:00 P.M.)
Chairperson J. Seymour asked for a moment of silence in memory
of Wayne Barlow.
Respectfully SL ')aiitted,
Dukk-u Lee
Public Utilities General Manager
A. McMenamin moved to
adjourn the Regular Meeting in
the Gordon Hoyt Conference
Center at 7:00 p.m. to the
Board's Regular Meeting date
of May 22, 2024 at 5:00 p.m.
A. Pham 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.
2024-37