Public Utilities 2012/05/23CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
May 23, 2012
The agenda having been posted on Wednesday, May 16, 2012, the Regular Meeting of the Public Utilities
Board (Board) was called to order by Chairperson Jordan Brandman at 5:04 p.m. on Wednesday, May 23,
2012, in the 11 Floor Large Conference Room, Anaheim West Tower, 201 S. Anaheim Blvd., Anaheim,
California.
Board Members Present: J. Brandman, J. Machiaverna, P. Carroll, C. Peltzer, D. Morgan,
B. Hernandez
Board Members Absent: S.E. Faessel
Staff Present: M. Edwards, D. Calkins, D. Lee, S. Sciortino, E. Zacherl, B. Beelner,
J. Lehman, A. Kott, L. Quiambao, P. Oviedo, M. Pan, R. Dowell, F. Barvarz,
J. Coe
Guest(s) Present: David Wain, Resident; Dr. Heywood, Resident
AGENDA ITEM
1. PUBLIC COMMENTS.
D. Wain, Resident, expressed his thanks to the Board for staff
explaining the benefits of Smart Meters to the Anaheim residents.
2. APPROVAL OF THE MINUTES OF THE REGULAR
PUBLIC UTILITIES BOARD MEETING HELD ON
APRIL 18, 2012.
M. Edwards shared items to be amended in the April 18, 2012
minutes, to reflect that J. Lehman and E. Zacherl were not in
attendance. Also item 10 will be amended to reflect that D. Wilson,
not J. Lehman, reported on the Energy Risk and Legislative,
Regulatory Affairs Issues.
The subsequent agenda was reordered (Agenda item #4 was
discussed after agenda items #5 and #6).
3. PRESENTATION ON ANAHEIM'S ELECTRIC SUMMER
LOAD ASSESSMENT.
The written, publicly available staff report detailing this
presentation was verbally summarized by staff.
ACTION TAKEN
J. Brandman closed the public
comments portion of the
meeting.
P. Carroll moved approval of
the Amended April 18, 2012,
Public Utilities Board Minutes.
D. Morgan seconded the
motion. MOTION
CARRIED: 6 -0.
ABSTAINED: 0. ABSENT:
1 (S.E. Faessel).
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4. APPROVAL OF FIVE — YEAR UNDERGROUND
CONVERSION PLAN FOR FISCAL YEAR 2012/13 TO
2016/17.*
The written, publicly available staff report detailing the item was J. Machiaverna moved
verbally summarized by staff.
approval of the Five -Year
verbally summarized by staff.
Conversion plan for Fiscal
The Board asked a variety of questions which culminated in their
Year 2012/13 to 2016/17. B.
decision to support the approval of the Five -Year Underground
Hernandez seconded the
Conversion Plan for Fiscal Year 2012/13 to 2016/17 for Anaheim
motion. MOTION
City Council's review and consideration.
CARRIED: 4 -0.
services for the Public Utilities Department for Anaheim City
ABSTAINED: 0. ABSENT:
Council's review and consideration.
3 (S.E. Faessel, J. Brandman
departed at 6:00 pm, P.
Carroll departed at 6:15 pm).
5. APPROVAL OF AN AGREEMENT BETWEEN
CATERPILLAR, INC. AND THE CITY OF ANAHEIM TO
PROVIDE SAFETY CULTURE SERVICES FOR THE
PUBLIC UTILITIES DEPARTMENT. *
The written, publicly available staff report detailing the item was
B. Hernandez moved approval
verbally summarized by staff.
for an agreement between
Caterpillar, Inc. and the City of
The Board asked a variety of questions which culminated in their
Anaheim to provide safety
decision to support the approval of the Agreement between
culture services for the Public
Caterpillar, Inc. and the City of Anaheim to provide safety culture
Utilities Department. J.
services for the Public Utilities Department for Anaheim City
Machiaverna seconded the
Council's review and consideration.
motion. MOTION
CARRIED: 6 -0.
ABSTAINED: 0. ABSENT:
1 (S.E. Faessel).
6. APPROVAL OF THE PUBLIC UTILITES DEPARTMENT'S
BUDGET FOR FISCAL YEAR 2012/2013.*
The written, publicly available staff report detailing the item was
verbally summarized by staff.
The Board asked a variety of questions which culminated in their
decision to support the approval of the Public Utilities Department
Budget for Fiscal Year 2012/2013 for Anaheim City Council's
review and consideration.
7. UPDATE ON WATER SYSTEM ISSUES.
D. Calkins, AGM of Water Services, commented on the annual
Solar Cup Boat Race held this past weekend at Lake Skinner near
Temecula, where 39 Southern California teams competed.
D. Morgan moved approval of
the Public Utilities Budget for
the Fiscal Year 2012/2013. B.
Hernandez seconded the
motion. MOTION
CARRIED: 6 -0.
ABSTAINED: 0. ABSENT:
1 (S.E. Faessel).
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Anaheim Public Utilities sponsored two teams this year, Anaheim
High School and Canyon High School. For the sixth time in ten
years, Canyon High School won the First place trophy in the
Veterans division. Anaheim High School won the sprint race in
their division. Next month, students and teachers from each team
will be recognized at the PUB meeting.
D. Calkins complimented the Anaheim student winners of this
year's annual Water Awareness Poster Contest. Eighteen students
from first through sixth grades were recognized at Angel Stadium
on May 16th, in a pregame ceremony. Each student received a
trophy, and their artwork was displayed on the big screen. D.
Calkins expressed thanks to S.E. Faessel, for representing the Board
at this event, in addition to her willingness to assist the Department
with increasing next year's participation by students in public
schools.
8. UPDATE ON ELECTRIC SYSTEM ISSUES.
D. Lee, AGM of Electric Services, provided an update on the
American Public Power Association (APPA) award for Reliable
Public Power Provider (RP3) which was awarded on April 16,
2012. Only 9% of the nearly 2,000 members receive this award.
Anaheim Public Utilities received the platinum designation which
was based on activities in the areas of safety, reliability, system
improvement, and workforce development.
D. Lee shared with the Board that two teams of line mechanics
participated in the Los Angeles electric lineman rodeo, where one of
the teams placed third in the Emergency Response/Hurt Man
Rescue event, which simulates the rescue of an injured person on a
utility pole. The Anaheim team of line mechanics competed in a
series of events with 22 other teams made up of journey mechanics
and apprentice line workers, from utility companies across the
western United States to demonstrate their skill and knowledge
regarding safe work practices.
9. UPDATE ON FINANCE SYSTEM ISSUES.
E. Zacherl, AGM of Finance and Administration, invited the
Board's attention to the April Financial Dashboard and shared that
the year -to -date electric revenues of $307 million are under budget
by $14 million or 4.4 %. Electric retail revenues for the month of
April of $23.7 million were also under budget, by $1.7 million or
6.7 %, while wholesale revenues of $2.9 million were over budget
by $200,000 or 8% due to transmission revenue. Year -to -date
operating costs of $304 million are $3 million or I% under budget.
Operating costs for the month of April of $29 million were
$800,000 or 3% over budget. Power supply costs exceeded budget
for the month by $3 million, due to the purchase of wholesale
power, needed to mitigate the extended outage at IPP and were
significantly offset by nearly $2 million, in reduction of other
operating costs. Year -to -date water revenues of $47.6 million were
over budget by $1 million or 2.6 %. Water revenues for the month
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of April were $4 million or just about at budget. April's Water
operating costs about at budget, in the amount of $4.6 million.
Operating expenses in both electric and water continue to be
monitored closely.
E. Zacherl additionally shared with the Board that the process of
refinancing a portion of a 2002 bond issue has begun, in order to
take advantage of current low interest rates and reduce the
Department's debt service expense. In conclusion, he reported that
the Fitch Rating Agency recently reviewed the Canyon Power
Project bonds and reaffirmed their AA- rating with no change in
their outlook.
10. UPDATE ON JOINT SERVICES ISSUES.
S. Sciortino, AGM of Joint Services, updated the Board on the
Customer Information System (CIS) Upgrade project that has begun
with a team of outside consultants that are occupying the 9th floor,
and are working on the project plan implementation. S. Sciortino
also announced that the proposal responses to the Convention
Center Solar Panel project have been received. A total of nine
responses were submitted, which will be reviewed in the next three
to four weeks. The contract award is expected to go to City Council
in September.
11. UPDATE ON ENERGY RISK & LEGISLATIVE/
REGULATORY AFFAIRS ISSUES.
J. Lehman, Chief Risk Officer of Energy Risk and
Legislative /Regulatory Affairs, invited the Board's attention to the
Department's quarterly Wholesale Energy Risk Management
(ERM) Report. The Department was in full compliance with the
ERM program for the Quarter and there were no changes to the
status of the counterparty credit portfolio rating.
J. Lehman also shared that, to date, the legislative session is going
well, including discussions with the authors of several of the more
contentious bills, and received concessions that significantly
improve the bills; for example, a bill that would have required very
costly detailed quarterly reporting on some of Anaheim's public
benefits programs has been modified to provide more useful
information to customers (AB 2227 — Bradford — D). Another bill
that would have imposed further constraints on utility ratemaking
ability, which could have potentially caused our customers to
subsidize certain energy producers, was modified to address our
concerns and additional modifications are still in the works that
would help to further clarify the bill (AB 1332 -- McLeod — D).
J. Lehman shared that a number of other bills are being observed
and worked on, and by June 1 the last day for a bill to pass out of
its house of origin, a better knowledge will be provided as to which
bills are contenders for passage, mentioning there's still room for
radical change to the bills. Also J. Lehman indicated that there has
been a Iot of effort on the part of staff in regard to the development
of regulations for both the implementation of the Renewable
33
Portfolio Standard program and the Greenhouse Gas Cap and Trade
program. The regulations for both are expected to be finalized in
the next several months. In conclusion, J. Lehman mentioned that
the next PUB Legislative Working Group Meeting will be in June;
at that point there will be a better idea, as to which of the more
significant pieces of legislation are viable in order to further prepare
either supporting or opposing strategies.
12. AGENDA ITEM(S) FOR THE NEXT PUBLIC UTILITIES
BOARD MEETING ON JUNE 27, 2012.
The agenda items for the next Board meeting are to be determined
at a later date.
13. ITEM(S) BY SECRETARY.
Nothing at this time.
14. ITEM(S) BY BOARD MEMBERS:
C. Peltzer expressed concerns about subsidizing residents who do
not have solar generated homes. J. Lehman referred to SB 1332
which has subsidized guidelines included.
J. Machiaverna commented on the great presentations in the
meeting. He also mentioned that after touring the Canyon Power
Plant again, he was struck yet again by what a great asset it is for
the City.
D. Morgan shared a personal story of a family member who
experienced a power outage outside of Anaheim's service territory,
and remarked on Anaheim's continued electric reliability. He also
thanked everyone for a good meeting and mentioned that the
proposed budget appears responsible.
15. ADJOURNMENT: (REGULAR MEETING ON JUNE 27, 2012
AT 5:00 P.M., IN THE 11" FLOOR LARGE CONFERENCE
ROOM, ANAHEIM WEST TOWER, 201 S. ANAHEIM
BOULEVARD, ANAHEIM, CALIFORNIA).
J. Machiaverna moved to
adjourn the Regular Meeting at
7:41p.m. to the Board's next
meeting date of June 27, 2012
at 5:00 p.m. C. Peltzer
seconded the motion.
MOTION CARRIED: 4 -0.
ABSTAINED: 0. ABSENT:
3 (S.E. Faessel, J. Brandman,
P. Carroll).
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Respectfully submitted,
vvA_1_---
Marcie L. Edwards
Secretary, Public Utilities Board
* Indicates item(s) that will be forwarded to City Council for action upon recommendation by the Board.
** Indicates items) that will be forwarded to City Clerk and City Council for informational purposes.
M