Public Utilities 2016/09/28CITY OF ANAHEIM
PUBLIC UTILITIES BOARD
MINUTES
September 28, 2016
The agenda having been posted on Thursday, September 22, 2016, the Regular Meeting of the Public Utilities
Board (Board) was called to order by Chairperson J. Machiaverna at 5:00 p.m. on Wednesday, September 28, 2016,
in the I Ph Floor Large Conference Room, Anaheim West Tower, 201 S. Anaheim Blvd., Anaheim, California.
Board Members Present: Chairperson J. Machiaverna, Vice Chair S.E. Faessel, B. Hernandez, D. Wain,
A. Abdulrahman
Board Members Absent: E. Medrano, L. Cahill
Staff Present: D. Lee, M. Moore, L. Quiambao, J. Lehman, A. Kott, R. Dowell, G. Bowen, J.
Lonneker, P. Oviedo, C. Thompson, T. Sato, P. Hayes, M. Robledo, M. Seifen,
A. Muniz, 1. Macias, D. Ballin
Guest(s) Present: Emily Goodwin, Ygrene Energy Fund
AGENDA ITEM
1. PUBLIC COMMENTS.
E. Goodwin, Ygrene Energy Fund, introduced herself and thanked both
staff and Board members for allowing her to briefly provide comments
regarding Agenda Item No. 6.
I. Macias, Resource Program Specialist Il, was presented a Certificate
of Appreciation and recognized for her leadership and involvement with
the Water Conservation Program.
L. Quiambao, Executive Assistant, introduced A. Muniz the new
Administration Secretary for the 1 Ph floor.
2. PUBLIC HEARING: APPROVAL OF MODIFICATIONS THAT
DO NOT RESULT IN ELECTRIC OR WATER RATE
INCREASES TO RULE NOS. 1, 2,15.0,15.1,15.2, AND 18
CONTAINED IN THE ELECTRIC RATES, RULES AND
REGULATIONS AND RULE NOS. 1, 2,15,19, 20, AND 23
CONTAINED IN THE WATER RATES, RULES AND
REGULATIONS, AND DETERMINE THAT THESE
MODIFICATIONS ARE EXEMPT UNDER THE CALIFORNIA
ENVIRONMENTAL QUALITY ACT PURSUANT TO SECTIONS
15060(C)(3),15061(B)(3),15378(B)(2),15378(B)(4), AND 15378(B)(5)
OF TITLE 14 OF THE CALIFORNIA CODE OF
REGULATIONS. *
The public hearing was called to order by Chairperson J. Machiaverna
for the purpose of accepting and responding to public comments on the
modifications to Rule Nos. 1, 2, 15.0, 15.1, 15.2, and 18 of the Electric
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ACTION TAKEN
There being no further public
comments, Chairperson J.
Machiaverna closed the public
comments portion of the
meeting.
B. Hernandez moved approval
of the modifications to Electric
Rule Nos. 1, 2, 15.0, 15.1,
15.2, and 18 of the Electric
Rates, Rules and Regulations
and Rule Nos. 1, 2, 15, 19, 20,
and 23 of the Water Rates,
Rules and Regulations; and the
determination that these
modifications are exempt
under CEQA. A.
Abdulrahman seconded the
motion.
MOTION CARRIED: 5-0
ABSTAINED: 0
ABSENT: 2 (E. MEDRANO
ITEM NO. 03
AGENDA ITEM ACTION TAKEN
Rates, Rules and Regulations and Rule Nos, 1, 2, 15, 19, 20 and 23 of and L. CAHILL).
the Water Rates, Rules and Regulations and the adoption of charges
included therein.
D. Lee stated these Rule modifications will not increase Electricity and
Water rates. The Public Utilities Department (Department) proposed
modifications to Electric and Water Rule No. 15 because it will provide
payment flexibility for larger projects and offer finance options to
qualified customers. Secondly, the Department proposed modifications
to Water Rule No. 20 to provide two alternatives for Fire Line Service;
the options will be to use hydraulic models where applicable or to use
previously conducted tests. For Electric Rule No. 18, the Department
proposed to remove certain restrictions to clarify that electric vehicle
charging stations owners or operators may recover their costs for
providing electric vehicle charging on site for public use if they choose
to do so.
In addition, D. Lee indicated that definition modifications will be made
to both Electric and Water Rule Nos. 1 and Water Rule No. 19 will be
eliminated and consolidated with Rule No. 2.
The Board did not have questions regarding the Rule modifications and
no public comments were received. J. Machiaverna closed the public
hearing.
3. APPROVAL OF THE MINUTES OF THE REGULAR PUBLIC D. Wain moved approval of the
UTILITES BOARD MEETING OF AUGUST 24, 2016. * Minutes of the Regular Public
Utilities Board Meeting of
August 24, 2016.13. Hernandez
seconded the motion.
MOTION CARRIED: 4-0
ABSTAINED: 0
ABSENT: 3 [J.
MACHIAVERNA (left the
Meeting at 5:12 p.m.), E.
MEDRANO, and L.
CAHILL].
4. PRESENTATION ON CAP AND TRADE PROGRAM.
T. Sato, Program Manager for the Department's Cap and Trade
Program (Program), provided a brief update that included what the
Program is and how it works. She further provided an overview of the
current market instability and why there have been fewer allowances
sold in recent auctions, explaining that actions by the courts regarding a
legal challenge of the Program caused uncertainty that kept buyers from
the Cap and Trade allowance auctions. Despite the uncertainty present
in the auctions, the Department will be able to meet its compliance
obligations and limit the fiscal impacts to customers.
5. PRESENTATION ON SCHOOL EDUCATION PROGRAMS.
P. Hayes, Business and Community Programs Manager, gave a
presentation on the Department's Student Engagement Programs. P.
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AGENDA ITEM
Hayes discussed how the Department invests in student engagement
programs that include high school mentoring and career symposiums, as
well as grade school curriculum that spur stewardship and sustainability
through various educational programs. Elementary programs include
outdoor field laboratories and the Traveling Scientist Program, which
provides a hands-on opportunity for students in Preschool through 6th
grade to develop awareness and appreciation of science concepts. P.
Hayes also discussed various ways in which the community is able to
engage in energy and environmental conservation in Anaheim through
events like Public Power Week and school fundraisers to bring
awareness to students and their families. Lastly, he made the Board
aware that the Department intends to bring forward a master agreement
renewal with Municipal Water District of Orange County for Water
Resources and Educational Services for the Board's consideration at a
future meeting.
6. APPROVAL OF RESOLUTIONS APPROVING ASSOCIATE
MEMBERSHIP IN THE GOLDEN STATE FINANCE
AUTHORITY (GSFA); CONSENTING TO THE INCLUSION OF
THE CITY OF ANAHEIM IN THE GSFA PROPERTY ASSESSED
CLEAN ENERGY PROGRAM; AUTHORIZING GSFA TO
CONDUCT CONTRACTUAL ASSESSMENT AND MELLO-
ROOS PROCEEDINGS AND LEVY ASSESSMENTS; AND
APPROVING A PARTICIPATION AGREEMENT WITH GSFA
AND YGRENE ENERGY FUND CALIFORNIA, LLC. *
G. Bowen, AGM — Power Supply, provided the Board with an overview
of the agreement with Golden State Finance Authority (GSFA) Property
Assessed Clean Energy Program (PACE) for Water Conservation and
Energy Efficiency Improvements. He indicated that Ygrene would be
the administrator for the Program and that this was the 51 such PACE
program in Anaheim. G. Bowen stated that the PACE program allows
property owners to secure upfront funding for Water Conservation and
Energy Efficiency measures, which they repay through a voluntary
contractual assessment lien on their property tax bill. G. Bowen
highlighted that the GSFA Program is slightly different than previous
PACE Programs that came before the Board. This Program provides
for the creation of Community Facilities Districts for the purpose of
financing or refinancing through the use of Mello -Roos assessments
because this type of program allows for financing over a longer period
of time and also potentially lowers interest rates for the customer
thereby giving the customer more options.
G. Bowen also indicated that the Department is working with program
providers to ensure they provide full disclosures to the customer about
the specifics of the PACE programs. Specifically, G. Bowen pointed to
new State legislation that requires program providers to disclose
complete financing information to customers, including liens that result
as part of financing through the program. Additionally, the program
provider must inform the customer that they have up to three days to
cancel the financing without penalty should they choose to do so. G.
Bowen indicated that the Department will provide a link on its web
page, for recently adopted State legislation that identifies consumer
protections when entering into PACE programs.
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ACTION TAKEN
B. Hernandez moved approval
of the Resolutions approving
Associate Membership in the
Golden State Finance
Authority (GSFA), consenting
to the inclusion of the City of
Anaheim in the GSFA Property
Assessed Clean Energy
Program, authorizing GSFA to
conduct Contractual
Assessment and Mello -Roos
Proceedings and Levy
Assessments, and approving a
Participation Agreement with
GSFA and Ygrene Energy
Fund California, LLC. D.
Wain seconded the motion.
MOTION CARRIED: 4-0.
ABSTAINED: U.
ABSENT: 3 (J.
MACHIAVERNA, E.
MEDRANO, and L.
CAHILL).
AGENDA ITEM
7, UPDATE ON WATER SYSTEM ISSUES.
Michael Moore, AGM — Water Services, provided an update on Water
Services. The Orange County Water District (OCWD) Board of
Directors authorized staff to move forward with the $350 Million final
expansion of the Groundwater Replenishment System (GWRS) project,
which will increase the production of the project from 100,000 acre-feet
per year to 130,000 acre-feet per year. The OCWD approval allows
staff to start the design and planning for the expansion; construction is
scheduled to begin in 2018. The project should not include any new
lakes in the City of Anaheim (City); instead, OCWD will be installing
new injection wells in Santa Ana for the new water supply to be injected
into the groundwater basin. The Board requested a presentation on the
proposed injection wells.
M. Moore updated the Board on projects under construction. The La
Palma Reservoir Complex project just started construction of the new
pump station and rehabilitation of the reservoir. This project will
improve water reliability in the western portion of the City. The project
is anticipated to be completed in 2018. The Windy Ridge Reservoir
construction contract was awarded and the contractor is providing
technical submittals in preparation for construction.
Lastly, the Department's construction crews have been regularly
replacing valves in the water system. A recent project in the
neighborhood near Edison Park has replaced many of the valves to
improve reliability and allow for faster isolation should a main break
occur in the future.
8. UPDATE ON ELECTRIC SYSTEM ISSUES.
ACTION TAKEN
Staff will provide a
presentation on injection wells
at a future meeting.
J. Lonneker, AGM — Electric Services, updated the Board on events Staff will present the annual
regarding the September 28, 2016 power outage that was reported to be reliability report at next
the result of vandalism. The Board requested information regarding month's Board meeting.
reliability performance.
J. Lonneker also updated the Board on the completion of the
underground conversion project along N. West Street and W. Westmont
Drive, displaying before and after photographs. Feedback from nearby
customers on their project experience will be solicited by survey.
J. Lonneker made the Board aware of the upcoming Public Power Week
(October 2 - 8, 2016) and of the events, held on Thursday, October 6
2016, at the Downtown Anaheim Farmers Market, where the public is
welcome to meet staff and visit booths with information about energy
saving programs and rebates.
9. UPDATE ON FINANCE ISSUES
R. Dowell, Acting AGM -- Finance and Administration, updated the
Board on the August 2016 Dashboard. R. Dowell indicated that for the
Electric division, revenues are up and expenditures are down for the
year; for the Water division, due to continued conservation, both
revenues and expenditures are down.
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AGENDA ITEM
10. UPDATE ON POWER SUPPLY ISSUES.
ACTION TAKEN
G. Bowen, AGM — Power Supply, made the Board aware that the
Department's Power Supply division had two outages over the last
month, the Kraemer Combustion Turbine Generator and San Juan Unit
4. Both suffered tube leaks that limited their operation. The Kraemer
facility was out for 21 days and San Juan Unit 4 was out for 7 days.
Kraemer is back in service and in standby to be dispatched while San
Juan Unit 4 is online and producing power to serve the City's load.
11. UPDATE ON ENTERPRISE RISK, COMPLIANCE, AND
LEGISLATIVE & REGULATORY AFFAIRS ISSUES.
J. Lehman, Chief Risk Officer, updated the Board on the Wholesale
Energy Risk Management (ERM) Program's Quarterly Compliance
report. The ERM sets criteria under which certain energy related
transactions can be made, while ensuring that the Department's interests
are protected and risks are identified and appropriately managed. J.
Lehman reported that all transactions were in compliance with the ERM
program, there were no violations.
She then shared that the Department had conducted its Annual
Emergency Response Planning drill in August, and that the exercise
went well. It focused on reinforcing several of the key fundamentals of
the program specifically the communications and notifications
requirements, staffing issues and documentation requirements to assist
in financial recovery. She mentioned that next month, the Annual
Report on the program would be provided to the Board.
She further reported that the Public Utilities Board Legislative Working
Group had met prior to the Board meeting and reviewed the key bills
remaining and new laws that have the potential to impact operations.
This included the extension of the Greenhouse Gas emission reduction
program until 2030. She stated that a full report on the activities of the
2016 Legislative session would be provided next month.
12. AGENDA ITEM(S) FOR THE PUBLIC UTILITIES BOARD
MEETING ON OCTOBER 26, 2016.
D. Lee stated the following items are planned for the following Board
meeting:
• Quarterly Status Reports on CIP, MA, GSA, and Spot Bid Awards
• Annual Report on Emergency Response Plan Activities
+ Water Adequacy Plan Update
+ Electric Reliability Report
• Department Order Approvals
13. ITEMS(S) BY SECRETARY.
D. Lee provided an overview of the electric and water bond sales. The
Department received favorable interest rates even though the water
credit rating was lowered from AAA to AA+ by Standard and Poor,
while it was held at AAA by Fitch. The lowering of the water credit
2016-61
AGENDA ITEM
rating was largely due to external circumstances and metrics that are
outside of the Department's control. However, the strong bond sales
will ensure that financial savings will be achieved for the refunding in
electric bonds.
P. Oviedo, Administrative Assistant, presented information about an
upcoming tour to San Gorgonio Wind Farm and encouraged the Board
to indicate their interest in one of two available tours.
14. ITEM(S) BY BOARD MEMBERS:
A. Abdulrahman thanked staff for the information that was provided
about bonds and future projects being planned.
D. Wain thanked staff for the meeting. He appreciated the information
conveyed in the Cap and Trade presentation and is looking forward to
the Public Power Week celebration.
B. Hernandez asked if the new water credit rating would affect the
Department's ability to sell bonds. D. Lee responded that although the
credit rating is not optimal, it did not impact the pricing or interest in the
Department's bonds, and the other water agencies have split credit
ratings as well.
S. E. Faessel thanked staff for keeping the Board informed of important
issues and events. She highlighted the Undergrounding Program and
mentioned how important it is for the public to see how the Department
is utilizing undergrounding funds.
15. ADJOURNMENT: (REGULAR MEETING ON OCTOBER 26,
2016, AT 5:00P.M., IN THE 11TH FLOOR LARGE CONFERENCE
ROOM, ANAHEIM WEST TOWER, 201 S. ANAHEIM
BOULEVARD, ANAHEIM, CALIFORNIA).
Dukku Lee
Public Utilities General Manager
ACTION TAKEN
D. Wain moved approval to
adjourn the Regular Meeting at
6:50 p.m., to the Board's
Regular Meeting date of
October 26, 2016 at 5:00 p.m.
A. Abdulrahman seconded the
motion.
MOTION CARRIED: 4-0.
ABSTAINED: 0.
ABSENT: 3 (J.
MACHIAVERNA, E.
MEDRANO, and L.
CAHILL).
* 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.
2016-62