* Items Taken Out of Order **Non-Agenda Items

Transcription

1 SNOHOMISH COUNTY PUBLIC UTILITY DISTRICT Regular Meeting February 16, 2016 The Regular Meeting was convened by President Tanya Olson at 1 :30 p.m. in the Commission Meeting Room. Those attending were David Aldrich, Vice President; Kathleen Vaughn, Secretary; CEO/General Manager Craig Collar; General Counsel Anne Spangler; Assistant General Managers Christopher Heimgartner and James West; other District staff; Clerk of the Board Melissa Collins; and Deputy Clerks of the Board Traci Brumbaugh and Lela Wall. * Items Taken Out of Order **Non-Agenda Items 1. COMMENTS FROM THE PUBLIC A. There were no comments from the public. 2. CEO/GENERAL MANAGER BRIEFING AND STUDY SESSION A. Update Media. Communications and Marketing Director Julee Cunningham reported on current news articles related to the District, and shared a recently televised news clip regarding the District's move to monthly billing. Legislative Update. CEO/General Manager Craig Collar reported that Government Relations Director Jessica Matlock and Chief Information Officer Benjamin Beberness were attending cybersecurity briefings in Washington D.C., and Legislative Liaison Brenda White was in Olympia, Washington. The high priority bills, that the District have been tracking, remain unchanged. Staff will provide a complete legislative update to the Board at the next briefing session. B. Energy Risk Management Report- 4th Quarter 2015 Power Analyst Zac Yanez provided an overview of the last quarter of Supply was below planned, mostly due to Slice. Wind and Jackson generation were above forecast expectations while Slice was planned to be critical for that quarter. On the demand side, loads came in below forecast, except for a cold temperature excursion around the Thanksgiving Day holiday. Day ahead prices were in-line with real time prices, except for that cold Thanksgiving weekend, where prices were higher than the day ahead prices. Mr. Collar noted that a $70 price excursion for winter is modest, compared to what the District has seen in the past. A graph showing a decline in forward prices indicated that people are becoming more optimistic about water conditions and prices. Discussed next were the Credit Limit Analysis, Financial Load Resource Imbalance Test, and Price Volatility test. There were no violations for the quarter.

2 Regular Meeting 2 February 16, 2016 C. H20 Supply Update Short-Term Power Trader Mike Shapley facilitated the presentation on the 2016 water supply year (October 2015 through September 2016). A water supply rankings chart for January through July ( ) showed that 2016 was slightly below average, at 96 percent of average. A water supply forecast chart highlighted a brief period in December where water supply was above the 30 year normal. The current 96 percent of normal forecast is approximately where the water supply began at the beginning of the 2015 water year. A basin map for October through January ( ) showed wetter than average water supply basin conditions. The National Oceanic and Atmospheric Administration (NOAA) forecast was for below average precipitation in the Northwest area, December through February; however, precipitation in the District's region has been above average. Temperatures for October through January ( ) were compared, and the impact of El Nino conditions on the water supply basins were discussed. Temperature anomalies were warmer than average overall, and for the second year in a row, November was cooler than average. December and January were moderately warmer than average. Maps were shown of sea surface temperature anomalies. Reservoirs were discussed and a chart graphed the past five years of Canadian Arrow Lake elevations and storage. Normally occurring inflows were held back due to United States-Canada treaty water obligations, which were returned to Canada from last year's dry spring and summer. The Grand Coulee Dam is currently on its targeted elevation. Uncertainty remains for the summer; however, adequate water supply is expected for March through June The District's Henry M. Jackson reservoir is full and on target for above average generation for the short-term. The Bonneville Power Association Administration (BP A) Slice generation forecast, which is the most volatile and largest portion of the District's energy portfolio, was discussed. A graph was presented, noting a difference from last year, with planning of 96 percent of average for the year, especially through the summer months. Mr. Shapely responded to Commissioner Vaughn's question regarding bandwidth storage, stating that it is dependent on the day and the storage facility elevation. Mr. Collar added that the next Water Update should include the operating envelope chart for the Grand Coulee Dam, as it governs the ability and latitude the District has, in respect to withdrawing storage bounds. Discussion continued regarding impacts on storage from planned dam repairs. The official three-month NOAA forecast was reviewed, indicating precipitation remains uncertain in El Nino years; however, temperatures are predicted to remain higher than average. A probability chart by the Climate Prediction Center (CPC) and International Research Institute (IRI) showed a declining El Nino, which begins to deviate after May 2016, showing a shift in August through October (2016), with an almost 50 percent probability of a La Nina season.

3 Regular Meeting 3 February 16, 2016 A Load and Resource Balance chart projected a balance March through April (2016) within 25 amw (Average Megawatt); going forward May through September (2016) long positions were shown, based on forecast, making adjustments every day; October through December of 2016, showed short positions at blend water conditions and will be monitored closely. Last winter, the District entered into physical call options to purchase power, if needed, for a small premium. Mr. Shapely stated that takes away the short position, and is relatively inexpensive. Models used to forecast 2016 regional resource availability indicate adequate generation resource capacity will be available. The models use known information such as planned generation outages, weather and load forecast, gas price forecast, water supply and imports and exports based on transmission line outages and adjacent area pricing. In conclusion, forward prices remain low, due to moderate demand and adequate generation supply. Regulatory, economic, and political uncertainty may bring changes to the industry. A declining El Nifio is forecast; however, model uncertainty exists later in the spring, and the ensemble model predictions forecast a normal water supply runoff and a predictable summer. The District is planning for blend or slightly below average water conditions for the remainder of the water year. The oil and natural gas markets should rebalance to slightly higher levels due to consumption growth, reductions in excess inventory and cuts in new infrastructure development. Historic low prices are expected for D. Helping Customers with Winter Bills Assistant General Manager Customer and Energy Services Jim West facilitated the presentation to address customer concerns regarding high winter bills. Mr. West explained that the main reason for the higher bills is the extra power usage during the winter months. In September 2015, the District implemented a new monthly billing system. Meters are still read every two months and customers are still billed only for the electricity used every two months. What is new is that, halfway into that two-month period, the District will calculate an estimated bill using the usage at the same location for the same period the year before. A good estimate of one month's electric use will be provided, which will be about half of the electric cost for the estimated bill and the second bill. The estimate is going to represent one month's energy use, at about half the cost for two months. There are some exceptions, which Mr. West noted he would explain. Monthly billing is a standard utility practice. Calculating an estimated bill is a standard feature in utility software systems, which makes it easier for customers and faster for the District to serve customers. The District has a long-term plan to upgrade a number of systems, which will allow new products and services to be offered to customers in the future. A few of the planned upgrades were mentioned, including adopting a new technology to make monthly meter reading easier. Since the District is a not for profit company, reading meters every month would mean those costs would be incurred by the customers. The District considered the affordability aspect for a temporary solution and whether a significant cost should be placed on customers when monthly estimated bills are working

4 Regular Meeting 4 February 16, 2016 for a majority of the District's 300,000 residential customers, who are in essence the owners of the company. Discussion continued on the cost of additional employees to read meters monthly, and customized software and billing system costs to continue bi-monthly billing versus monthly billing. A video was presented explaining the monthly billing process, and Mr. West answered Commissioner Aldrich's questions regarding a recent news story that profiled a customer who seemed to have used excessive amounts of Kilowatt hours (kwh). Mr. Aldrich expressed that the implications are that the District is deliberately misreading meters and overcharging customers with higher bills, which is not the case, but it is difficult to overcome that perception. Mr. Collar responded that Mr. West would reflect on resolutions to specific customer concerns, during the evening portion of the meeting. A chart explaining the colder weather conditions was shown, to represent winter average daily temperature for September - January and The chart also represented an outdoor temperature of 65 degrees or higher. Mr. West stated that a more reasonable way to look at the weather, in terms of understanding energy use, is to look at heating degree-days (HDD). HDD is a measurement designed to reflect the energy needed to heat a home, and is the difference between the daily average outdoor temperature and a baseline indoor temperature of 65 degrees. The sum of those daily calculations for a month/billing period captures the impacts of short cold snaps more than a monthly average temperature can. This is why bills can be higher from one month, compared with the next month. It is not just about the average temperature difference, but rather the length of time it was colder in each of those months. An example of a typical electrically heated 1,400 square foot home in the District's service area was used to compare the kwh usage billed for the past 13 months. District Programs including Previous Period Billing, Budget Billing Discount and Assistance programs, energy efficiency programs and payment arrangements were discussed as options to assist customers with their electric bill payments. Discussion continued on what customers can do to conserve including; the District's heating, and weatherization rebates, as well as Snohomish County Weatherization loans, low-income and senior discount rates, and grants. Mr. West also stated that there will be District Customer Service Associates available during the evening meeting for customers who would like to get solutions to account issues and conservation programs will be featured on tabletop displays, as well as a variety of printed materials. Commissioner Vaughn stated that the Board would like customers having issues with their bills, to feel as though they are being heard. Mr. West reported as of Friday, February 12, 2016, there were 85 concerns that were escalated through Customer Service and were considered out of the ordinary. Of those, virtually every customer's concern was resolved.

5 Regular Meeting 5 February 16, CONSENT AGENDA A. Approval of Minutes for the Regular Meeting of February 2, 2016 B. Bid Awards, Professional Services Contracts and Amendments Public Works Contract Award Recommendations Over $25,000: Request for Proposal No with Kemp West, Inc. Request for Proposal No with Asplundh Tree Expert Co. Formal Bid Award Recommendations $60,000 and Over: Professional Services Contract Award Recommendations $200,000 and Over: Miscellaneous Contract Award Recommendations $200,000 and Over: Cooperative Purchase Recommendations: Sole Source Purchase Recommendations: Emergency Declarations, Purchases and Public Works Contracts: Purchases Involving Special Facilities or Market Condition Recommendations: Formal Bid and Contract Amendments: Professional Services Contract No with CH2M Hill Engineers, Inc. Contract Acceptance Recommendations: Public Works Contract No with Pellco Construction, Inc. C. Consideration of Certification/Ratification and Approval of District Checks and Vouchers D. Consideration of a Resolution Designating an Authorized Representative and Alternate for Coordinating Matters Relating to the District's Request for Certain Disaster Assistance Funds From Appropriate Federal and State Agencies for the November 2015 Severe Storms, Straight-line Winds, Flooding, Landslides, and Mudslides A motion unanimously passed approving 3A - Approval of Minutes for the Regular Meeting of February 2, 2016; 3B- Bid Awards, Professional Services Contracts and Amendments; 3C - Consideration of Certification/Ratification and Approval of District Checks and Vouchers; and 3D- Resolution No Designating an Authorized Representative and Alternate for Coordinating Matters Relating to the District's Request for Certain Disaster Assistance Funds From Appropriate Federal and State Agencies for the November 2015 Severe Storms, Straight-line Winds, Flooding, Landslides, and Mudslides.

6 Regular Meeting 6 February 16, ITEMS FOR INDIVIDUAL CONSIDERATION A. Consideration of a Resolution Declaring the Existence of Special Market Conditions and Authorizing the Purchase of Federal Communications Commission Authorized VHF Frequency Licenses from Scott Macintyre A motion unanimously passed approving Resolution No declaring the existence of special market conditions and authorizing the purchase of Federal Communications Commission authorized VHF Frequency Licenses from Scott Macintyre. B. Consideration of a Resolution Authorizing the CEO/General Manager or Designee to Execute a Grant Agreement with the State of Washington Department of Health to Allow the District to Conduct a Feasibility Study for the Warm Beach Water Association A motion unanimously passed approving Resolution No authorizing the CEO/General Manager or designee to execute a grant agreement with the State of Washington Department of Health to allow the District to conduct a feasibility study for the Warm Beach Water Association. 5. COMMISISON BUSINESS A. Commission Reports There were no Commission Reports. 6. GOVERNANCE PLANNING A. Governance Planning Calendar There were no changes to the Governance Planning Calendar. The meeting recessed at 3:00p.m. RECONVENE REGULAR MEETING The Regular Meeting was reconvened by President Tanya Olson at 6:00p.m. in the Auditorium. Those attending were David Aldrich, Vice President; Kathleen Vaughn, Secretary; CEO/General Manager Craig Collar; General Counsel Anne Spangler; Assistant General Manager James West; other District staff; members of the public; Clerk of the Board Melissa Collins; and Deputy Clerks of the Board Traci Brumbaugh and Lela Wall.

7 Regular Meeting 7 February 16, CEO/GENERAL MANAGER BRIEFING A. Customer Winter Bills Commissioner Olson began the meeting by recognizing that many customers had questions and concerns about their winter PUD bills. Customer Service Managers were available to work with customers one-on-one, on specific billing issues, and could provide options and resources. Assistant General Manager Customer and Energy Services Jim West was introduced to provide additional background information and a brief presentation on helping customers with winter bills. Customers expressed concerns and asked questions regarding high winter bills, monthly billing, the age and accuracy of meters, energy efficiency investments, the District's new billing system, and estimated billing. ADJOURNMENT There being no further business or discussion to come before the Board, the Regular Meeting of February 16, 2016, adjourned at 10:01 p.m. An audio file of the meeting is on file in the Commission Office and available for review. Approved this 1st day of March (not present) Secretary ~A-~~~ Vice President