Public Utilities 2013/06/26CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
JUNE 26, 2,013
The agenda having been posted on Thursday, June 20, 2013, the Public Hearing / Regular Meeting of the
Public Utilities Board (Board) was called to order by Vice Chairperson John Machiaverna at 5:02 p.m. on
Wednesday, June 26, 2013, in the I O Floor Large Conference Room, Anaheim West Tower, 201 S. Anaheim
Blvd., Anaheim, California.
Board Members Present: J. Machiaverna, P. Carroll, B. Hernandez, C. Peltzer, D. Singer, S.E. Faessel
Board Members Absent: D. Morgan
Staff Present: D. Lee, E. Zacherl, S. Sciortino, J. Lehman, D. Ballin, A. Kott,
M. Jouhari, L. Quiambao, P. Oviedo, G. Bowen, C. Thompson,
D. Wilson, M. Brownrigg, C. Godoy, R. Dowell
Guest(s) Present: D. Wain, Resident & Chairperson of the East District Neighborhood Council;
S. Faessel, Resident & Chairperson of the Underground Conversion
Subcommittee; Clay Elliot, Savanna High School Team Advisor; Andy
Gonzales, Savanna High School student; Natalie Luna, Savanna High School
student; Mena Shihad, Savanna High School student; Rena Rotano, Savanna
High School student; Nigel Smith, Canyon High School student.
AGENDA ITEM
1. PUBLIC HEARING: RECEIVE AND RESPOND TO
COMMENTS ON THE ANAHEIM PUBLIC UTILITIES
DEPARTMENT 2013 PUBLIC HEALTH GOAL REPORT.
J. Machiaverna opened a public hearing on the City of Anaheim's
2013 Public Health Goal Report (Report) for Water Quality. Each
Board Member had received a copy of the report dated May 22, 2013
He indicated that the Report was made available for public review on
the City of Anaheim's webpage and the Water Engineering front
counter located on the 6' Boor, of Anaheim West Tower at 201 S.
Anaheim BIvd., Anaheim, CA 92805. A Notice of Public Hearing
was also placed in the newspaper regarding the Public Hearing.
D. Wilson, Environmental Services Manager, gave a presentation
providing an overview of the 2013 Public Health Goal Report. He
reported that two out of eighty -four substances exceeded their public
health goals, but they are naturally occurring and all of Anaheim's
water met all State and Federal drinking water standards.
ACTION TAKEN
There being no public
comments and no written
correspondence to the Public
Utilities Board Secretary
concerning the subject, Vice
Chairperson J. Machiaverna
closed the public hearing.
2013 -34
AGENDA ITEM ACTION TAKEN
2. PUBLIC COMMENTS.
S. FaesseI expressed his gratitude for the consideration and courtesy
shown to him during his years of service on the Underground
Conversion Subcommittee.
J. Machiaverna shared that he was honored to be able to serve with S.
FaesseI, and that his service is unmatched.
3. PRESENTATION ON SOLAR CUP RACES.
C. Godoy, Communications Supervisor, shared a brief background of
the Solar Cup Program with the Board, acknowledging the efforts and
success of the Savanna, Anaheim and Canyon High School students
and their participation in the annual Solar Cup Boat Races. C. Elliot,
Savanna High School Team Advisor, shared about the positive
experience the program provides students.
Following the solar cup presentation, D. Lee thanked Board Members
P. Carroll and C. Pelzer for their service and provided them with
proclamations that highlighted the many accomplishments over their
respective terms.
4. APPROVAL OF THE MINUTES OF THE PUBLIC HEARINGS /
B. Hernandez moved approval
REGULAR PUBLIC UTILITIES BOARD MEETING OF MAY
of the minutes of the Public
22, 2013. *
Hearings 1 Regular Public
Utilities Board Meeting of May
22, 2013. D. Singer seconded
the motion.
MOTION CARRIED: 6-0.
ABSTAINED: 0.
ABSENT: 1 (D. Morgan).
5. PRESENTATION ON SUMMER LOAD ASSESMENT.
C. Thompson, Principal Integrated Resource Planner, shared a high
level summary presentation with the Board about the upcoming
summer electricity supply and demand outlook, in the California
Independent System Operator (CAISO) balancing authority area, as
well as Anaheim's preparedness to manage its operations, should an
event occur that threatens the reliability of the electric grid. She
explained that although the San Onofre Nuclear Generating Station
(SONGS) will no longer be available, there are sufficient supplies
anticipated by the CAISO.
6. PRESENTATION ON GENERATION RESOURCES
PORTFOLIO PLANNING.
G. Bowen, Integrated Resources Manager, invited the Board's
attention to the Utilities Resource Portfolio. He shared an overview
of plans for divestiture of the Department's fossil fuel resources (coal)
and provided a timeframe of when those divestitures could potentially
take place in the upcoming years. He continued by including the
Department's options with regard to building additional generation
2013-35
AGENDA ITEM ACTION TAKEN
capacity at the Canyon facility in order to replace the capacity lost as
result of divestiture of their coal facilities.
Additionally, he presented a forecast of what the Department's
resource portfolio will look like over the coming two decades with the
divestiture of its coal facilities and with the addition of new
generation, including gas and renewable resources.
7. CERTIFY THAT MODIFICATIONS TO RULE NOS. 6 AND 7 P. Carroll moved approval of
CONTAINED IN THE ELECTRICAND WATER RATES,
the Certification that
RULES AND REGULATIONS ARE EXEMPT UNDER THE
Modifications to Rule Nos. 6
CALIFORNIA ENVIRONMENTAL QUALITY ACT, SECTION
and 7 contained in the Electric
15061(B) (3) OF TITLE 14 OF THE CALIFORNIA
and Water Rates, Rules, and
ADMINISTRATIVE CODE AND APPROVAL OF
Regulations are Exempt under
MODIFICATIONS TO RULE NOS. 6 (ESTABLISHMENT AND
the California Environmental
REESTABLISHIMENT OF CREDIT) AND 7 (DEPOSITS) OF
Quality Act, Section 15061(B)
THE ELECTRIC AND WATER RATES, RULES AND
(3) of Title 14 of the California
REGULATIONS.*
Administrative Code and
Approval of Modifications to
The written, publicly available staff report detailing the item was
Rule Nos. 6 (Establishment
verbally summarized by staff. The proposed rule modifications are in
and Reestablishment of Credit)
support of ongoing efforts to provide regulatory relief and to help
and 7 (Deposits) of the Electric
provide flexibility in the application of deposits.
and Water Rates, Rules and
Regulations. D. Singer
The Board asked a variety of questions which resulted in their
seconded the motion. MOTION CARRIED: 6-0.
decision to support the approval of the modifications to Rule Nos. 6
ABSTAINED: 0.
and 7.
ABSENT: I (D. Morgan).
S. PRESENTATION ON THE CONVENTION CENTER SOLAR
PROJECT.
M. Brownrigg, Solar Advantage Program Manager, gave a
presentation to the Board on the Anaheim Convention Center Solar
Photovoltaic (PV) Project, providing details about the proposed 2.6
megawatts (MW) solar PV system. Following an extensive
nationwide Request for Proposal (RFP) process, staff will recommend
award of the project to Borrego Solar, Inc. for a total cost of
$5,794,200. It is anticipated that the project will be presented to the
City Council on July 23, 2013, to design and build the project. The
design and build agreement will be managed by the Public Works
Department. Project completion is anticipated in late Spring 2014.
9. APPROVAL OF FISCAL YEAR 2012/2013 WRITE -OFF OF
UNCOLLECTIBLE UTILITY ACCOUNTS.*
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 Fiscal Year 2012/2013 Write
off of Uncollectible Utility Accounts.
D. Singer moved approval of
the FY12I13 Write -Off of
Uncollectible Utility Accounts.
B. Hernandez seconded the
motion.
MOTION CARRIED: 6 -0.
ABSTAINED: 0.
ABSENT: 1 (D. Morgan).
2013 -36
AGENDA ITEM
10. DISCUSSION REGARDING THE PROPOSED USE OF THE
PROCEEDS FROM THE REVOLVING CREDIT
AGREEMENT TO FUND EXISTING OR ADDITIONAL
WATER CAPITAL EXPENSES OR PROJECTS.
The written publicly available information detailing this item was
summarized by staff and discussed by the Board.
11. UPDATE ON WATER SYSTEM ISSUES.
M. ]ouhari, Acting Assistant General Manager (AGM) of Water
Services, shared that Anaheim's water system is inspected annually
by the Department of Public Health (DPH). During the inspection,
the Health Department inspectors visit each water facility to look for
any potential unsanitary conditions. Last month, the water system
was inspected by DPH and no deficiencies were found.
12. UPDATE ON ELECTRIC SYSTEM ISSUES.
D. Lee, AGM of Electric Services, reported that electric reliability is
constantly reviewed and recently, Southern California Edison (SCE)
contacted Anaheim staff to inquire as to why the Department's
reliability metrics are so good. There was a slight increase in
restoration times of late, and further investigation indicated that
metallic balloons accounted for about 40% of all outage minutes this
year, and poles damaged by vehicles accounted for over 10 %. A full
electric reliability presentation will be presented to the Board later this
year.
13. UPDATE ON FINANCE ISSUES.
E. Zacherl, AGM of Finance and Administrative Services, invited the
Board's attention to the Utilities Dashboard. He shared that year -to-
date revenues for both electric and water remain over budget through
the month of May, both attributable to the warmer than normal
weather last summer as well as the month of May this year creating
additional demand for both services. Year -to -Date electric revenues
of $403.5 million were $21.6 million or 5.7% over budget. Electric
expenses for that period of $364.9 million were $12.1 million over
budget or 3.4 %. Power costs exceeded budget by $20.4 million and
were partially offset by lower expenses in labor, operating and debt
service. Electric revenues for the month of May were $24.8 million,
which was $1.8 million or 7.3% over budget.
E. Zacherl reported to the Board that the year -to -date water revenues
through May were $54.5 million, which is $3.2 million or 6.2% over
budget. Year -to -date water expenses through May of $48.5 million
are $100,000 or 0.3% greater than budget as a result of water supply
costs exceeding budget by $1.4 million or 5.1 % due to the increased
demand but offset by reductions in reduced labor, maintenance and
operating expenses. Water revenues for the month of May of $5.3
million were also over budget by 12.1% due to a lack of rain since the
ACTION TAKEN
2013 -37
AGENDA ITEM
end of December and the continuing warm and dry conditions during
May causing irrigation demands to remain high.
14. UPDATE ON JOINT SERVICES ISSUES.
S. Sciortino, AGM of Joint Services, personally thanked P. Carroll
and C. Peltzer for their time and dedication on the Board and in
particular, their concern, interest and investment they took as
participating members. He shared that staff has always appreciated
their questions and interests in all the issues brought before the Board.
In addition, S. Sciortino advised the Board that staff was going to City
Council with amendments to the existing geothermal power sales
agreement (PPA) with Thermo. He stated that the project had
mechanical issues over the last few years that limited its output and
that there had been unanticipated regulatory changes that restricted
the amount of Renewable Energy Credits that would be approved by
the state oversight agency for compliance. The amendments to the
PPA reflect the refurbishment of the facility, increasing the amount of
renewable energy the Department will receive, as well as added
provisions that protect the Department in the event that any future
energy delivered loses its renewable eligibility. Under those
conditions, the Department would pay a discounted price for the
energy received.
15. UPDATE ON ENERGY RISK & LEGISLATIVE /
REGULATORY AFFAIRS ISSUES.
J. Lehman, Chief Risk Officer, shared a brief report on the Enterprise
Risk Management Program, sharing that the risks associated with the
closure of the San Onofre Nuclear Generating Station would be
included. She also mentioned that the Public Utilities Legislative
Working Group will be meeting next month.
16. AGENDA ITEM(S) FOR THE NEXT PUBLIC UTILITIES
BOARD MEETING ON JULY 24, 2013.
• Proposed 2013/2014 Update to the Five -year Underground
Conversion Plan*
• Regulatory Relief— Modifications to Electric Rule 16 & 24 and
Water Rule No. 16*
• Anergeria - Renewable Power Purchase Agreement*
17. ITEM(S) BY SECRETARY.
D. Lee reported that the Memorandum of Understanding (MOU)
between the City and the International Brotherhood of Electrical
Workers (IBEW) was approved by City Council on June 18. It is a
short term agreement through the end of this calendar year, and
negotiations for a longer term MOU will commence this fall.
ACTION TAKEN
2013-38
AGENDA ITEM ACTION TAKEN
D. Lee reported that the $1.6 billion City budget was approved on
June 18, which includes the Utilities budget. D. Lee thanked the
Board and staff for their hard work on the budget.
D. Lee stated that S. Sciortino would be Acting Public Utilities
General Manager in July with D. Calkins acting in August.
18. ITEM(S) BY BOARD MEMBERS.
D. Singer thanked staff for having the bushes trimmed near the
Roosevelt Park, which she believes is helping to prevent accidents.
B. Hernandez commented on the value of City employees, sharing his
experience with a water supply concern that impacted his residence,
where he had the opportunity to meet two water field employees E.
Glotfelty and M. Takaoka, who provided excellent service and
assistance in resolving the service concerns, and also providing him
with a follow up. He added that City employees are top notch and are
all about servicing the residents of Anaheim.
S.E. Faessel complimented the staff on the solid team work through
shared knowledge experience, after which she expressed her
appreciation to P. Carroll and C. PeItzer for their leadership and
experience they have shared with her.
P. Carroll thanked L. Quiambao and P. Oviedo for their work and
efforts in putting together the PUB meetings. He also thanked A.
Kott for reading through all the contracts and all the legal advice she
provided to the Board. He concluded by thanking everyone and
encouraging the Board to keep up the good work.
C. Peltzer thanked the Board and staff for all their work during his
time serving on the Board. He also shared his satisfaction with
visiting the coal mines, and taking the Metropolitan Water District
Inspection tour.
J. Machiaverna commented on how much he has learned from P.
Carroll and C. Peltzer, continuing that a program for incoming Board
members with outbound Board members would be beneficial due to
the amount of information there is to learn about serving on the
Anaheim Public Utilities Board.
19. ADJOURNMENT: ( REGULAR MEETING ON JULY 24, 2013,
P. Carroll moved to adjourn the
AT 5:00 P.M., IN THE 11 FLOOR LARGE CONFERENCE
Public Hearing / Regular
ROOM, ANAHEIM WEST TOWER, 201 S. ANAHEIM
Meeting at 7:43 p.m. to the
BOULEVARD, ANAHEIM, CALIFORNIA).
Board's Regular Meeting date
of July 24, 2013 at 5:00 p.m.
C. Peltzer seconded the
motion.
MOTION CARRIED: 6 -0.
ABSTAINED: 0.
ABSENT: 1 (D. Morgan).
Kill
AGENDA ITEM
ACTION TAKEN
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.
MMUM,