MEETING OF THE ELECTRIC UTILITY COMMISSION NOVEMBER 14, 2022 6:00 PM AUSTIN ENERGY HEADQUARTERS/SHUDDE FATH CONFERENCE ROOM 4815 MUELLER BLVD AUSTIN, TEXAS Some members of the Electric Utility Commission maybe participating by videoconference. Public comment will be allowed in-person or remotely by telephone. Speakers may only register to speak on an item once either in-person or remotely and will be allowed up to three minutes to provide their comments. Registration no later than noon the day before the meeting is required for remote participation. To register contact Robin Otto, at Robin.Otto@austinenergy.com or via phone at 512-322-6254. AGENDA Members: Marty Hopkins, Chair Dave Tuttle, Vice Chair Marshall Bowen Randy Chapman Cary Ferchill Karen Hadden Makenna Jonker Cyrus Reed Kay Trostle Vacant Vacant CALL MEETING TO ORDER PUBLIC COMMUNICATION: GENERAL The first 5 speakers signed up prior to the meeting being called to order will each be allowed a three- minute allotment to address their concerns regarding items not posted on the agenda. APPROVAL OF MINUTES 1. Approve the minutes of the Electric Utility Commission Regular meeting on October 18, 2022. DISCUSSION AND POSSIBLE ACTION ON RECOMMENDATIONS 2. Recommend authorizing negotiation and execution of a contract with Camlin Inc to provide and install a system for monitoring the bushings on a power transformer at Sand Hill Energy Center, in an amount not to exceed $130,000. 3. Recommend authorizing award of a contract with PWR Storage Solutions, LLC d/b/a Power Storage Solutions to provide and install an uninterruptible power supply, stand- alone battery charger, and power conditioning transformer, in an amount not to exceed $120,000. 4. Recommend authorizing negotiation and execution of two multi-term contracts with Transworld Systems Inc. and I C System Inc. for collection services for delinquent utility accounts each for up to five years for total contract amounts not to exceed $3,000,000, divided between the contractors. 5. Recommend authorizing reimbursement of costs to Waller Creek Owner, LLC., for the service pipe connection to interconnect the Waller Building to the Austin Energy (AE) downtown District Cooling System in an amount not to exceed $2,308,703. 6. Recommend authorizing an amendment to a cooperative contract with Carahsoft Technology Corp. for continued ServiceNow products, services, and software, including maintenance and support, to increase the amount by $477,040 and to extend the term by four months, for a revised total contract amount not to exceed $7,632,090. 7. Recommend authorizing negotiation and execution of a …
Item 12 Draft Resolution on a Required Update to the Resource Plan Electric Utility Commission November 14, 2022 WHEREAS, the Electric Utility Commission has been given the important task of reviewing and advising the City Council on progress on the Austin Energy Resource, Generation and Climate Protection Plan to 2030; and WHEREAS, the Resource plan approved by City Council in 2020 includes a specific direction that the plan be updated in five years, unless conditions change warranting a need for a new update, stating “Austin Energy will conduct an update of this 2030 Plan in advance of its cost-of-service study in approximately five years from adoption of the 2030 Plan, or sooner if significant changes in technology or market conditions warrant. At the end of 2022 the EUC will decide whether there have been sufficient changes in circumstances that an interim update would be beneficial.”; and WHEREAS, the plan laid out a vision for ending Austin Energy’s use of power from the burning of coal by stating “Austin Energy will maintain its current target to cease operation of Austin Energy’s portion of the Fayette Power Project (FPP) coal plant by year-end 2022. Austin Energy will continue to recommend to the City Council the establishment of any cash reserves necessary to provide for that schedule.”; and WHEREAS, Austin Energy has not been able to meet this deadline of ceasing operation of Austin Energy’s portion of the Fayette Power Plant (FPP); WHEREAS, the 2020 Resource Plan required Austin Energy to conduct a transmission study to look at how to boost the use of storage and renewables both within our load zone and from imported clean energy from outside our load zone and that transmission study is expected to be completed and reviewed by staff by June 2023; and WHEREAS, since the plan was adopted by city council in 2020, other major changes have occurred, including impacts to the electric grid caused by Winter Storm Uri, and major changes implemented by both the Legislature and the Public Utility Commission of Texas which have and could further change our energy-only market and required ancillary services; and WHEREAS, the Public Utility Commission is expected to take further action in early 2023 that could fundamentally change our energy and ancillary services market; and WHEREAS, the cost of natural gas increased by roughly 288 percent between August of 2020 and August of 2022, creating both major expenses …
Resolution on Value of Solar Tariff in Austin Energy Rate Case Electric Utility Commission November 14, 2022 WHEREAS, the Electric Utility Commission has been given the important task of reviewing and advising the City Council on the Austin Energy’s proposed changes to base rates; and WHEREAS, the Austin Energy Resource, Generation and Climate Protection Plan to 2030 and the Austin Climate Equity plan, both adopted by Council, include goals for increasing the use of local customer-sited solar energy in order to reduce greenhouse gas emissions and other pollution, improve resilience, and keep bills affordable; and WHEREAS, Austin Energy has proposed important changes to the Value of Solar tariffs as part of its base rate that could impact these goals; WHEREAS, the Value of Solar tariff is essential for facilitating the continued use of local customer-site solar energy; and WHEREAS, it is important for the Value of Solar tariff to accurately compensate customers with on-site solar energy for the energy they produce, and to provide a rate that isn’t too volatile, in order to attract investment in customer-sited solar; and WHEREAS, if a portion of the Value of Solar fee is paid for by the Energy Efficiency Fee instead of the Power Supply Adjustment fee, then some customers will be exempted from their fair share of the costs since they are exempted from the Energy Efficiency Fee, creating the potential for a cross-subsidy; WHEREAS, the Impartial Hearings Examiner found that while Austin Energy’s proposed changes were reasonable, they also urged better consultation with stakeholders going forward; NOW THEREFORE BE IT RESOLVED that the Electric Utility Commission recommends that the Austin City Council do the following when adopting the updated Value of Solar tariff as part of Austin Energy’s base rate package: 1. Adopt Austin Energy’s Value of Solar rate and methodology as proposed in its Base Rate Filing Package and as adopted by the Impartial Hearing Examiner in his Final Recommendation, with the exception that Value of Solar Societal Benefits should continue to be collected through the PSA. 2. Base the avoided costs of the Value of Solar rate on a rolling five-year average, and conduct the Value of Solar avoided cost assessment annually but require Austin Energy to change the rate not more frequently than every three years based on a rolling five-year average of avoided costs. 3. Direct Austin Energy to hire a qualified third party, with experience in …
Resolution of the Electric Utility Commission on Austin Energy’s Base Rate Proposal November 14, 2022 WHEREAS the Electric Utility Commission has been given the important task of reviewing proposed modifications to Austin Energy’s base rates; WHEREAS, Austin Energy released their proposed base rate package in April of 2022, proposing a significant increase on several customer classes, including residential and small business customers; WHEREAS, a base rate proceeding was recently concluded before an Independent Hearings Examiner with filings of exceptions and briefs by some 10 parties to the Austin Energy base rate proceedings; WHEREAS, Austin Energy’s initial proposal would raise revenues and rates by approximately $48 million, a proposal that was reduced by approximately $13 million due to changes made by Austin Energy in the course of the proceeding, meaning the current Austin Energy proposal is to raise rates by approximately $35.7 million; WHEREAS, the Independent Hearings Examiner has recommended a smaller revenue requirement of approximately $31.3 million, but also indicated a need to look at differential sales during the unique year of 2021 which might lower that recommended revenue requirement substantially; WHEREAS, the Independent Consumer Advocate hired by the City has instead proposed a much smaller revenue increase of approximately $6.5 million, with a much smaller impact on residential consumers; WHEREAS, multiple parties including the IHE itself have raised concerns that Austin Energy’s proposed residential rate design - which would increase the fixed monthly fee from $10 to $25 and flatten the incentive to conserve energy by reducing the number of tiers from 5 to 3 is a significant change to our residential rate design and could represent a shock to Austin Energy residential consumers, particularly those that are not protected by CAP; WHEREAS, multiple parties have identified other potential savings that could reduce the revenue requirement significantly, including adjustments to recognize the uniqueness of the test year, which included both a major winter storm and a pandemic; WHEREAS, the rising costs of shelter combined with rising utility costs most heavily impact those households with the lowest incomes and the thousands of eligible families that are not presently receiving CAP program benefits, WHEREAS, the Austin City Council just approved new tariffs for the Power Supply Adjustment, Regulatory Charge and CBC, which collectively will increase the average residential bill by some $15 per month over current charges, and adoption of the Austin Energy proposal could increase overall residential bills by at …
Item 10 Electric Utility Commission 2023 Meeting Schedule The Electric Utility Commission meets monthly on the second Monday of the month, unless otherwise determined by the Commission. If the regular meeting day conflicts with a holiday, the meeting will be held on the following Monday. Meetings are held at 6:00 p.m. in the Shudde Fath Conference Room at Austin Energy HQ, 4815 Mueller Blvd. Changes to the above regarding date, time or location will be noted on meeting agendas. MEETING DATES January 9, 2023 February 13, 2023 March 21, 2022 April 10, 2023 May 8, 2023 June 12, 2022 July 10, 2023 August 14, 2023 September 11, 2023 October 16, 2023 November 13, 2023 CANCELLED DATES March 13, 2023* October 9, 2023** December 11, 2023 *AISD/UT/etc. Spring Break **Columbus/Indigenous Peoples Day
EUC Report re Council Action November 14, 2022 Item 13 Items below recommended by EUC October 17; Council approved on date indicated in parenthesis. 2. (10/27) Recommend authorizing negotiation and execution of a multi-term cooperative contract with SHI-GOVERNMENT SOLUTIONS Inc, to provide Novell SUSE software maintenance and support for up to three years for a total contract amount not to exceed $495,000. 3. (10/27) Recommend approving issuance of a five-year production-based incentive (PBI) to Paloma Ridge Owner, LLC, for the installation of solar electric systems on their facility located at 13620 N FM 620 Rd, Austin, TX 78717, in an amount not to exceed $2,041,981. 4. (11/3) Recommend authorizing negotiation and execution of a contract with Texas AirSystems, LLC for modular heat exchanger skids, for a term of five years in an amount not to exceed $25,000,000. 5. (11/3) Recommend authorizing negotiation and execution of a contract with Thielsch Engineering Inc. for power production maintenance, for a term of five years in an amount not to exceed $20,000,000.
Item 2 Posting Language ..Title Authorize negotiation and execution of a contract with Camlin Inc. to provide and install a system for monitoring the bushings on a power transformer at Sand Hill Energy Center, in an amount not to exceed $130,000. [Note: This solicitation was reviewed for subcontracting opportunities in accordance with City Code Chapter 2-9C Minority Owned and Women Owned Business Enterprise Procurement Program. For the goods and services required for this solicitation, there were no subcontracting opportunities; therefore, no subcontracting goals were established]. ..Body Lead Department Financial Services Department. Client Department(s) Austin Energy. Fiscal Note Funding is available in the Capital Budget of Austin Energy. Purchasing Language: The Financial Services Department issued a Request for Proposals (RFP) 1100 JMF3015 for these goods and services. The solicitation was issued on November 15, 2021, and it closed on January 4, 2022. Of the two offers received, the recommended contractor submitted the best evaluated, responsive offer. A complete solicitation package, including a log of offers received, is available for viewing on the City’s Financial Services website, Austin Finance Online. Link: Solicitation Documents. Prior Council Action: Click or tap here to enter text. For More Information: Respondents to this solicitation, and their representatives, shall continue to direct inquiries to the solicitation’s Authorized Contact Persons: Julia Finn, at 512-974-2835 or Julia.Finn@austintexas.gov or Diana McIntosh, at 512-974-2034 or Diana.McIntosh@austintexas.gov. Council Committee, Boards and Commission Action: November 14, 2022 - To be reviewed by the Electric Utility Commission. Additional Backup Information: The contract will provide a system for monitoring the bushings on a power transformer and the system’s installation at Sand Hill Energy Center. The system will provide real-time information about the transformer bushings to detect deterioration. A bushing failure could result in loss or reduction in generation from the plant. An evaluation team with expertise in this area evaluated the offers and scored Camlin Inc. as the best to provide these services based on schedule and solution, proposer experience and personnel, price, local presence, and service-disabled business enterprise. ..Strategic Outcome(s) Strategic Outcome(s): Government that Works for All. Item 3 Posting Language ..Title Authorize award of a contract with PWR Storage Solutions, LLC d/b/a Power Storage Solutions to provide and install an uninterruptible power supply, stand-alone battery charger, and power conditioning transformer, in an amount not to exceed $120,000. [Note: This solicitation was reviewed for subcontracting opportunities in accordance with City Code Chapter 2-9D (Minority …
BOARD/COMMISSION RECOMMENDATION Electric Utility Commission Recommendation No. 20221114-11A Resolution on Austin Energy’s Base Rate Proposal RESOLVED, the Electric Utility Commission urges the Austin City Council to: 1. Apply the rate making policies of gradualism and avoidance of rate shock for each customer class. Gradualism should be applied equally to classes that would receive a revenue (rate) reduction and to classes that would receive a revenue (rate) increase, under the adopted class revenue distribution approach. 2. Maintain the present residential rate structure of inverted block rates that encourage conservation. While reducing the number of tiers from five to four may be considered, as suggested by the Independent Consumer Advocate, any increase in the basic customer service fee should be limited to no more than 20%. A $2 dollar increase in the monthly fee would on its own with no other changes generate approximately $11.4 million in additional revenues for the utility. 3. Apply its understanding of known and measurable changes and weather normalization to the 2021 test year; 4. Line Loss Study: Require Austin Energy to conduct a new System Loss Study (Line Loss Study) to derive both peak demand and energy loss factors by service level (transmission, substation, primary, and secondary) prior to the next base rate case. The peak demand loss factors shall be used to develop the demand allocation factors in the next rate case. The energy loss factors shall be used to develop the energy allocation factors in the next rate case and the voltage adjustment factors in the Power Supply Adjustment. 5. Primary Substation Rate: Require Austin Energy to develop a Primary Substation rate consistent with the analysis in the IHE report and propose it as part of its rate filing package in its next base rate review, at which point it will be subject to review. 6. Transmission Service: Require Austin Energy to provide a pathway for Primary >20 MW HLF customers to purchase the facilities necessary to upgrade to transmission service. Austin Energy shall provide this pathway no later than 1 year after the Council action approving the rates set in this base rate review. 7. Value of Solar Tariffs. Adopt the Austin Energy proposal in the Base Rate Filing Package, with the exception that the Value of Solar Societal Benefits should be collected through the PSA. Cost recovery for the Societal Benefits will be subject to review in Austin Energy’s next base rate …
BOARD/COMMISSION RECOMMENDATION Electric Utility Commission Recommendation No. 20221114-11B Resolution on Austin Energy’s Base Rate Proposal RESOLVED, the Electric Utility Commission urges the Austin City Council to: 1. Reject the Austin Energy proposed base rate revenue increase of $35.7 million and the IHE recommendation of $31.3 million increase to Austin Energy’s base rates; 2. Adopt a Revenue Requirement of at least $6.5 million as recommended by the ICA but no more than $15 million, roughly half of the IHE’s proposal; 3. Adopt a Revenue Distribution that would not increase the rates on any customer class more than 7.5%, such as the attached table (WorkPaper H-3.1.1) produced by Austin Energy for the EUC $15 million scenario which limits the rate increase to 7.5% on any customer class. The table is illustrative of a possible cost allocation by rate class with a revenue increase of $15 million limited to a maximum of 7.5 percent, but is not meant to be a specific recommendation from the EUC on cost allocation. 4. Consider adopting the Independent Consumer Advocates proposed residential rate design with the following scope: a. Increase In-City Residential Monthly Customer Charges by no more than 20% or $2, b. Change the current 5 tier structure to 4 tiers as follows: Tier 1 (0 – 500); Tier 2 (501 – 1300); Tier 3 (1301 – 2500); Tier 4 (Over 2500). c. Adopt tier rates similar to that proposed by the ICA, or such as (Tier 1 – 4) those attached in the scenario “WorkPaper H-3.1.1”: 0.03061 per Kwh 0.06200 per Kwh 0.09176 per Kwh 0.11317 per Kwh d. The rates above can be scaled up or scaled down proportionally to achieve the residential target revenue requirement target adjusted for any higher customer charge. Vice Chair Dave Tuttle; Commissioner Randy Chapman; Commissioner Karen Hadden; Commissioner Makenna Jonker; Commissioner Cyrus Reed; Commissioner Kay Trostle Chair Marty Hopkins; Commissioner Marshall Bowen; Commissioner Cary Ferchill Vote: For: 6-3 Against: Abstentions: None Off Dais: None Absences: None Vacancies: District 2, District 3 Attest: Robin Otto, Staff Liaison Austin Energy 2022 Rate Review Class Base Revenue Changes Page 1 EUC Scenario Proposal, $15 Million increase, 7.5% maximum, $12 Customer Charge, 4 steep tiers Austin Energy Filing Proposed Rebuttal Description At Current Rates Change % Change Change % Change Residential Secondary Voltage < 10 kW Secondary Voltage ≥ 10 < 300 kW Secondary Voltage ≥ 300 kW Primary Voltage < 3 …
BOARD/COMMISSION RECOMMENDATION Electric Utility Commission Recommendation No. 20221114-12 Resolution on a Required Update to the Resource Plan WHEREAS, the Electric Utility Commission has been given the important task of reviewing and advising the City Council on progress on the Austin Energy Resource, Generation and Climate Protection Plan to 2030; and WHEREAS, the Resource plan approved by City Council in 2020 includes a specific direction that the plan be updated in five years, unless conditions change warranting a need for a new update, stating “Austin Energy will conduct an update of this 2030 Plan in advance of its cost-of-service study in approximately five years from adoption of the 2030 Plan, or sooner if significant changes in technology or market conditions warrant. At the end of 2022 the EUC will decide whether there have been sufficient changes in circumstances that an interim update would be beneficial.”; and WHEREAS, the plan laid out a vision for ending Austin Energy’s use of power from the burning of coal by stating “Austin Energy will maintain its current target to cease operation of Austin Energy’s portion of the Fayette Power Project (FPP) coal plant by year-end 2022. Austin Energy will continue to recommend to the City Council the establishment of any cash reserves necessary to provide for that schedule.”; and WHEREAS, Austin Energy has not been able to meet this deadline of ceasing operation of Austin Energy’s portion of the Fayette Power Plant (FPP); WHEREAS, the 2020 Resource Plan required Austin Energy to conduct a transmission study to look at how to boost the use of storage and renewables both within our load zone and from imported clean energy from outside our load zone and that transmission study is expected to be completed and reviewed by staff by June 2023; and WHEREAS, since the plan was adopted by city council in 2020, other major changes have occurred, including impacts to the electric grid caused by Winter Storm Uri, and major changes implemented by both the Legislature and the Public Utility Commission of Texas which have and could further change our energy-only market and required ancillary services; and WHEREAS, the Public Utility Commission is expected to take further action in early 2023 that could fundamentally change our energy and ancillary services market; and WHEREAS, the cost of natural gas increased by roughly 288 percent between August of 2020 and August of 2022, creating both major expenses for …
Electric Utility Commission 2023 Meeting Schedule The Electric Utility Commission meets monthly on the second Monday of the month, unless otherwise determined by the Commission. If the regular meeting day conflicts with a holiday, the meeting will be held on the following Monday. Meetings are held at 6:00 p.m. in the Shudde Fath Conference Room at Austin Energy HQ, 4815 Mueller Blvd. Changes to the above regarding date, time or location will be noted on meeting agendas. MEETING DATES January 9, 2023 February 13, 2023 March 20, 2023 April 10, 2023 May 8, 2023 June 12, 2023 July 10, 2023 August 14, 2023 September 11, 2023 October 16, 2023 November 13, 2023 *AISD/UT/etc. Spring Break **Columbus/Indigenous Peoples Day CANCELLED DATES March 13, 2023* October 9, 2023** December 11, 2023
