INTERMOUNTAIN RURAL ELECTRIC ASSOCIATION Colorado 16 Jefferson Sedalia, Colorado

Transcription

1 INTERMOUNTAIN RURAL ELECTRIC ASSOCIATION Colorado 16 Jefferson Sedalia, Colorado A regular meeting of the Board of Directors of the lntermountain Rural Electric Association was called to order at the office of the Association at 5496 North U.S. Highway 85, Sedalia, Colorado, at 9:30 a.m., December 21, The following Directors were present, constituting a quorum: Tim White, Jim Anest, Bob Graf, Mike Kempe, Duke Dozier, Gene Sperry, and Bruff Shea. CEO Patrick Mooney and staff also were present. Agenda Approval Upon motion by Mr. Shea, seconded by Mr. Dozier, the Board of Directors unanimously approved the agenda. Public Comment There was no public comment, as there were no individuals present who wished to address the Board of Directors. Minutes Approval Upon motion by Mr. Anest, seconded by Mr. Sperry, the Board of Directors unanimously approved the minutes of the November 16, 2017, regular meeting. Mr. White presented the CREA report. CREA Report Mr. White attended the CREA meeting on December 7 and 8. The executive director reported on the CREA building renovation and hail damage. Discussion at the meeting included the PUC telecom docket, CREA's potential participation in the solar tariff issue being considered by the International Trade Commission, potential renewable energy standard bills, other potential legislation, and the budget. Guest speaker Libby Mojica, with the consulting firm EDM discussed endangered species being actively monitored and proposed Congressional reform of the Endangered Species Act. Finance Report Ms. Dede Jones presented the Finance report. The margin for the month of November was $710,000, which was almost $1.7 million lower than what was budgeted. The biggest contributor to this variance was the recloser

2 Page2 depreciation adjustment. Sales were slightly higher than budgeted for the month of November but were offset by unbilled revenue. Power costs were below budget as was distribution maintenance expense. Year-to-date, the margin is just over $39 million, $11.2 million higher than budgeted. The PCA adjustment refunds that were approved last month started in December and will reduce the full-year margin. We should see the margin variance to budget go down in December. Sales, power costs, and distribution operations and maintenance expense are lower than budgeted. Ms. Jones reviewed the risk management and safety data reports. She reported that there was one OSHA recordable injury in the month of November. Operations and Engineering Report Ms. Pam Feuerstein presented the Operations and Engineering report. In November, Comanche Unit 3 had a plant capacity factor of 83%. IREA's effective capacity factor was 93%. Demand for the month of November was 356 MW, down from November kwh sales were up slightly from the previous year. There were 204 new service applications in November. There were 408 new services completed, while 2,931 services were in construction and over 2,037 services were in design or under contract. The Association has 157,230 services now in place. There were a few outages in November. The Floyd Hill area experienced high winds at the end of October, which carried into November. A squirrel caused a large outage out of the Orchard substation. Victory Solar produced 1.6 million kwh in the month of November, with a capacity factor of 17.6%. In November, IREA received 45 new applications for small generation interconnection. To date, IREA has 1,570 solar interconnections, 1,557 of which are net-metering customers. Ms. Feuerstein discussed the AMI project. Consumer Services Report Ms. Mandi Lesher presented the Consumer Services report.

3 Page 3 Disconnect notices for November 2017 are up slightly from November The number of calls is still trending fairly low with 10,711 calls for the month of November, down 5.5% from The abandon rate and the average speed to answer went up from last month, and the service level decreased. The service goal was achieved. The total number of consumer electronic contacts in November was 3,368, up 86% from November The number of customers enrolled in ebilling continues to increase; there are 61,518 ebilled accounts as of November. The Power Cost Adjustment refunds started posting on December 4 and have gone very well. Letters and phone calls were sent to key accounts so that they could notify third-party billing centers for payment processing. Corporate Services Report Mr. Gerry Hacker presented the Corporate Services report. Mr. Hacker reviewed the Association's human resources statistics, including employee turnover rates. Mr. Hacker reported that the payroll conversion implementation took place on December 15 and that employee and supervisor training on isolved is completed. The first scheduled pay date using the isolved system is January 5. The collective bargaining agreement between IBEW Local No. 111 and IREA has been ratified and executed as well as a side letter regarding implementation of the 9/80 work schedule. The Human Resources department arranged to have the Parker and Castle Rock Centers for Audiology technicians visit IREA in December. They performed 55 hearing tests in the course of two days. The positive response from employees resulted in committed time for additional on-site exam dates in The Cayenta 7.9 upgrade is essentially complete. IREA and Cayenta are still working to resolve a few remaining minor defects. The Consumer Self Service Generation Ill software is scheduled to go into production on January 8. Mr. Hacker discussed the Association's website, activity, cybersecurity measures, and network risk assessments. Mr. Hacker reviewed other miscellaneous items from his report.

4 Page4 Corporate Affairs Report Mr. Josh Liss presented the Corporate Affairs report. The EPA took comments regarding Clean Power Plan repeal last month. On December 7, EPA Administrator Pruitt told members of the U.S. House Energy and Commerce Committee that the agency is working to replace the rule. The new replacement rule is expected to be limited to inside the fence regulation of power plants. On December 7, the Bureau of Land Management issued a rule postponing the Methane and Waste Prevention Rule for one year. At the beginning of 2017, Congress attempted to repeal the rule altogether under the Congressional Review Act, however, the vote failed. The Bureau has instituted essentially a one-year stay so that the oil and gas industry has time figure out how to comply with the rule. The Colorado Energy Office (CEO) released a draft plan to increase the number of electric vehicle charging stations statewide. The CEO is proposing to provide grants to public and private entities to build more EV charging stations and is partnering with the Colorado Department of Public Health and Environment, which plans to use about $10.4 million from funds received by the state as part of the Volkswagen Diesel Emissions Settlement to help build EV charging stations throughout the state. Electrify America a subsidiary of Volkswagen is proposing to install eight to ten EV charging stations along 1-25, 1-70, and This ties into Governor Hickenlooper's announcement that other states surrounding Colorado are agreeing to put in charging stations within miles of each other to help EV owners to travel from state to state. IREA has reached out to the Energy Office and is part of the working group and can sit in on meetings and monitor the progress. The plan also calls for the Energy Office to encourage electric utilities to investigate possible investments they can make that would minimize upfront infrastructure costs for EV charging stations. Senators Scott and Donovan have proposed a draft to rewrite the 811 structure to change the Utility Notification Center of Colorado into a quasi-governmental agency. IREA attended a stakeholder meeting held earlier this week. The General Assembly convenes in January and IREA and CREA plan to share concerns about the draft with the working group and sponsors. Ms. Amy Watson presented the legal report. Legal Report PSCo filed a petition in FERC to amend the Association's power purchase agreement by adding a cost recoupment charge to apply if IREA is obligated to purchase power from PURPA qualifying facilities. This filing also requests a determination that PSCo's

5 Pages avoided cost should be IREA's avoided cost for PURPA QF purchases. Ms. Watson addressed the proposed amendment. Discussion ensued. Ms. Watson discussed a notice of claim in which IREA was named. Ms. Watson updated the Board regarding the Town of Parker use tax refund. A response was received yesterday from the Town. The Town concedes that IREA is owed a refund for the use tax it was charged, however, the Town is proposing to put in their town specific sales tax exemption form as well as make some changes to its code, to impose a sales tax on entities that it does not currently impose. There is a possibility that this issue will be settled with a statement that IREA will collect sales tax on these entities when the code is passed and those changes are put into place. Ms. Watson discussed PSCo's filing with the PUC regarding early retirements of Comanche Units 1 and 2. The Boulder Electric Utility has a deadline in December to file agreements with the PUC. PSCo and Boulder stated that they are working together; however, the agreements are not ready. The PUC granted Boulder's request for an additional 90-day stay, so the agreements will be due in March. On December 1, the U.S. Supreme Court granted certiorari to Salt River Project (SRP) to determine whether orders denying state-action immunity to public entities are immediately appealable under the collateral-order doctrine. Mr. White called for a ten-minute break. Chief Executive Officer's Report Mr. Patrick Mooney presented the CEO report. The current director donation lists were made available to each director. Mr. Mooney encouraged the Board to review their current donations, note any changes they would like to make for 2018 and return the lists to Josh Liss. The Oregon utility regulators have directed PacifiCorp to evaluate the costs of its coal plant investments, including four units that are in Colorado, to determine whether they make sense economically. PJM interconnection and Peak Reliability have announced they are in discussions to evaluate an RTO. This announcement comes at the same time as both California ISO and Southwest Power Pool are looking to expand.

6 Page6 Minnesota's PUC has approved Xcel Energy's plans to terminate uneconomic renewable energy contracts with biomass and landfill plants. Xcel will purchase the plants and shut them down. Mr. Mooney noted that the PSCo transmission true-up credit will appear on the year-end financials. Installation of the new transformer at the Bergen Park substation has been delayed again until March 15, IREA will issue member certificates to our customers as called for by state law. The certificates are a formality. Mr. Mooney discussed a meeting that he attended with Amy Watson, Pam Feuerstein, and other area cooperatives. Mr. Mooney reminded the Board of the 2018 CREA annual membership meeting in February and the Board and staff event in January. Action Items Upon motion by Mr. Graf, seconded by Mr. Shea, the Board of Directors unanimously approved the consent agenda, including refunds of deceased consumer patronage capital in the amount of $71, for the month of November and write-offs in the amount of $48, Board Meeting Calendar The proposed dates for the 2018 regular Board meetings are the third Thursday of each month except for February, March, and July, when the fourth Thursday is proposed. Audit Committee meetings are proposed for the January, April, July, and October regular meeting dates. Upon motion by Mr. Graf, seconded by Mr. Kempe, the Board of Directors unanimously approved setting regular monthly meetings of the Board of Directors at the Association's headquarters on the third Thursday of each month during 2018, except that the February, March, and July regular meetings shall be held on the fourth Thursday of those months, with all such meetings to begin at 9:30 a.m., at the Association's Sedalia offices. Proposed Resolution Mr. Mooney recommended approval of Resolution BR17-24, 2018 Business Financial Plan. Ms. Dede Jones made a presentation regarding the proposed 2018 budget, and changes mad since the budget was first presented in November. Mr. Shea, Mr. Kempe, and Mr. Graf requested and received information regarding certain items. Upon

7 Page7 motion by Mr. Shea and seconded by Mr. Dozier, the Board of Directors unanimously adopted the following resolution: BOARD RESOLUTION BR17-24 Whereas, the Chief Executive Officer and Chief Financial Officer of the ("the Association") have presented to the Board of Directors the 2018 Business Financial Plan as Board Document BD17-16, which consists of the proposed 2018 operating budget, capital budget, construction work plan, donations budget, and director education and industry events budget; and Whereas, the Board of Directors has reviewed the 2018 Business Financial Plan with Association staff; and Whereas, the Chief Executive Officer and Chief Financial Officer have recommended approval of the 2018 Business Financial Plan; Now, therefore, be it resolved that the Board of Directors hereby approves the 2018 Business Financial Plan as presented. Proposed Resolution Mr. Mooney recommended approval of Resolution BR17-25, System Improvement Contracts Awards. Upon motion by Mr. Graf and seconded by Mr. Anest, the Board of Directors unanimously adopted the following resolution: BOARD RESOLUTION BR17-25 Whereas, The ("the Association") has scheduled five system improvement projects in the Sedalia, Woodland Park, and Conifer districts for completion in 2018; and Whereas, the Association divided the projects into two bid packages and solicited bids from three contractors for the construction services necessary to complete the projects; and Whereas, the Association received proposals for both bid packages from Colorado Powerline, Inc., Foothills Energy Services Inc., and Ward Electric Company, Inc.; and Whereas, Colorado Powerline, Inc. submitted the lowest responsive bid for each bid package; and

8 Page8 Whereas, Association staff has evaluated the proposals and recommends awarding contracts to Colorado Powerline, Inc. for the Sedalia and Woodland Park Districts Bid Package #1 and the Conifer and Woodland Park District Bid Package #2 in the amounts of $504, and $593,896.88, respectively; and Whereas, the Association's engineering staff, in coordination with the Association Attorney, has drafted and negotiated System Improvement Construction Agreements with Colorado Powerline, Inc. for the 2018 system improvement work, which contracts have been presented to the Board as Board Document BD17-17; and Whereas, the Chief Executive Officer recommends Board approval of such agreements; and Whereas, the Board of Directors has determined that such recommendation is in the best interest of the Association and its members; Now, therefore, be it resolved that the Board of Directors authorizes the Association to award and the President to execute System Improvement Construction Agreements with Colorado Powerline, Inc. for the Sedalia and Woodland Park Districts Bid Package #1 and the Conifer and Woodland Park District Bid Package #2 in the amounts of $504, and $593,896.88, respectively, and such unanticipated additional amounts, if any, as may be reasonably necessary to complete the 2018 system improvement projects NRECA Voting Delegate and Alternate Currently, the NRECA voting delegates are Mr. Graf and Mr. Dozier, respectively. Mr. Mooney explained that no formal action is necessary to appoint delegates if the delegates are to remain the same for 2018 as they were for 2017, but a motion to change the delegates would be necessary if the Board desires to do so. There was a consensus that Mr. Graf should remain the Association's 2018 voting delegate for NRECA and Mr. Dozier should remain the alternate delegate; therefore, no vote was taken. Executive Session Mr. White called for an executive session for the purpose of discussing Comanche Unit 3, legal matters, and the CEO evaluation. Upon motion by Mr. Graf, seconded by Mr. Anest and carried unanimously, the Board of Directors approved an executive session. The Board convened in executive session with Mr. Mooney.

9 Page9 Upon reconvening, Mr. Anest moved, Mr. Graf seconded, and the Board unanimously approved a 3% salary increase, rounded up the nearest $10k, in 2018 for the Chief Executive Officer in addition to a performance bonus in the amount of $45,000. There being no further business to discuss, President Tim White adjourned the meeting. The next regular meeting will be held on January 18, 2018.