EWEB Board of Commissioners — November 1, 2022

0:04 okay November first 2022 general meeting V1 Electric Board to order the first agenda item is the agenda check does anybody have any comments or questions about the agenda this evening and I'll just make a quick comment I know we have uh some time tonight for a budget because total like 40 minutes set aside the handful of questions that nice shares of 10 minutes um anyway I just wanted to find that not sure if that'll be sufficient but perhaps just agree but I'm sure we'll figure out a way to accommodate it cool all right thank you for the heads up anything else and the next agenda item is going to be items from board members and general manager I think I'll start with the general manager this evening uh thank you president Brown just just one uh procedural reminder we did get uh

0:52 quite a few uh questions prior to the meeting and uh just just to make we had a couple of different answer threads going on uh just a reminder to Commissioners to copy the general manager and the GM office you can also copy the senior staff as well the executive team but we got a couple different response uh threads going on for people just just as a reminder glad to get the questions I'm glad to get our responses but just just a reminder procedurally thank you you know that you wear Brenda's stay warm is coming up I signed up for it we'll see if I can

1:37 twice I'll be there to show other Zone but I just want to remind others sign up the other thing I have is I attended Coburg Elementary go or so and presented the fifth grader with this second place poster and uh as I've done that for many many years and it's always fun to watch the kids light up when they get notified but more importantly to see their interest in what we do I mean they I had a ton of questions and it was really fun and so I kind of really enjoy it so thank you for looking whoever let's give you that opportunity other than that uh that's it um the next agenda item if there's nothing else from the board or general manager will be the public input and before I got one the public input I'll just say that uh if you're participating in my telephone

2:22 remember to unmute your call press star six if calling from a landline you're supposed to use the unmute button and calling from your cell phone okay when you're and for in person speaking this evening when your name is called please come forward and close to your name and obviously your address or board each speaker will be offered three minutes to present their testimony please keep track of time by watching the timer at the front of the room or by listing for an audio notification when three minutes has lapsed after all testimony is heard each commissioner will have an opportunity to speak if they choose although by policy we do not engage in a back and forth dialogue please note that the failure of permission to speak shall not be construed as support of or opposition to any speaker's testimony the question is presented to a speaker and the board does not provide an answer the web staff member will contact the speaker so the question can be addressed at a later

3:07 time this time I will open the public testimony period and first is Mr Smith uh on the phone are you there yes I'm here can you hear me the word with whatever is thank you thank you uh yes William Smith Ward one and I'm here to talk about Wireless meter technology and possible alternatives uh recently I saw a mailing from eweb a newsletter I guess called water power

3:54 and people it's uh it it focused on uh determining the future of the Lee bird hydroelectric project and outline four alternatives and I thought wow this is great um wouldn't it be wonderful if eweb were to launch a similar project on determining the future of uh customer empowerment related to meters and I thought well okay well what what might that look like and of course you have might have option or alternative number one being

4:39 the wireless meter technology that continues to be rolled out and many people are concerned about and some are getting sick and I have gotten sick after uh our whole block got installed with meters and a few of us opted out but nevertheless kind of like secondhand smoke it's affecting me and others so anyway meet the continued Wireless meter alternative might be one number two might be analog meters and I thought of a possible number three that might Intrigue you all and that is uh fiber optic connected meters

5:24 you may know that fiber optics have incredibly good economics once they're the initial investment is made of putting them in the ground they tend to be very low cost to maintain and those savings could be passed on to customers and also you get unlimited bandwidth at very little cost so eweb might like that in terms of the information that that you all seem to be interested in using to help you know manage your end of things so I hope you'll consider that as a possible win-win and a way to empower people without making them sick thank you thank you Mr Smith

6:09 um anybody else in the next uh speaker will be Chris Jones I come up here yeah just come over sit down please thank you good evening Commissioners staff my name is Chris Jones and I live on Kincaid Street in South Eugene and I'm coming to you tonight with a compliment and also a small suggestion um I worked for eweb for a few years and I became as a result kind of a an infrastructure nerd every time I'd be driving around with my spouse I'd be pointing out you know Transformers and insulators and circuit breakers and oil filled circuit breakers right next to the river and all sorts of great stuff and she used to give me a hard time and

6:55 tell me that she couldn't see any of it and so imagine my delight as we were taking a trip up the MacKenzie River a couple of months ago when we could finally agree on something which was that there were 28 miles of eweb transmission line that ran from the Lieber generation facility down to Walterville neither of us could see them and that's because eweb had removed them after building a new substation they were no longer needed so this was I think 28 miles of line that ran across Farm Fields And across School athletic fields and all through the woods requiring all sorts of vegetation management and eweb threw a lot of hard work from engineers and construction

7:42 and line Crews and Property Management folks and the people who pay the bills they were able to remove those lines and it's a beautiful thing but I just want to acknowledge that you know it sometimes when you go out and you see that there's nothing there that's because there are a lot of people who did a lot of hard work to make that nothing up here so good job my very small request is completely unrelated it's related to the budget and rates that Miss Hart will be presenting later tonight and I noticed it's in your packets in appendix B table seven which is that in a residential bill this is a bit of wonkery but on a residential

8:28 bill it's still broken out in a res in an energy charge and a delivery charge and those charges are presented to the customer and I've asked for years and I've never got an answer that I found satisfactory as to why those two charges are still someone confusingly presented to the customer instead of the customer just saying here's your charge per kilowatt hour I can understand possibly in a commercial setting having charges for different things and making the bill a little bit more complicated but I urge you in 2023 to be Brave and Bold and continue on the road of continuous Improvement for eweb and consolidate

9:13 that charge to a single kilowatt hour charge for the residential customers you can still do whatever you want in the background I don't need to see it so thank you thanks for your time and all your hard work is there anybody else signed up to speak this week if not then I would close public input the miles for comments from commissioners Sonia Steve thank you for coming out appreciate you taking the time to come down and share your thoughts and uh to the gentleman of line thank you for sharing your thoughts as well I'd like to back a track on that too uh Chris because I was around when they started that project and and I mean I spent what

10:00 eight or ten years ago when they started doing that and we talked about uh the right-of-way and the move of the poll Appliance I noticed we just had a legal uh notice in the paper about abandoning uh that particular Corridor and things such as that I think my understanding of the reason we have the two charges of Base rate and the kilowatt rate is because of uh I have meters that I don't use any consumption and and if I don't use any consumption and you bury the base rate into the usage rate then I can I mean people will say well how come I'm getting a bill because I haven't used one kilowatt and I haven't seven meters but I'm not using it and so that if a banker rod wants to expand on that

10:45 I'll certainly understand in the in the present environment where Chris is referring to the delivery charge and the energy charge both both being based on kilowatt hours it's a bit redundant to split that into two categories the reason that we started to look at two categories instead of one is eventually we would like to have a demand charge associated with the residential environment as well to be able to address peaks in a little different way so right now it is redundant he's he's correct it's a little bit confusing but we have a lot of work to do around rate design in the next couple of years and that's that's a piece of it thank you thank you very much any other questions or comments about supporting

11:30 options thank you for attending and uh thank you Mr Smith for providing your input so I've closed the public input now the next gen item is consent calendar a anybody have anything and you want to move or discuss if not I will entertain a motion any discussion all those in favor by saying by saying aye that's unanimously uh consent calendar B anything to be removed or discussed technically discussion not all those in favor of secretary saying aye and passage unanimously thank you very much yes I just wanted to make a note just in

12:16 case if people are listening or watching that commissioner barofsky is not in attendance this evening and well I'm not the one who makes the determination I believe the board president can decide whether that is an excused absence or not but I just wanted to make make note of that for the public for the record yes it was an excused absence he's on an extended vacation and good for him uh and I hope to be able to have somebody say that about me in a couple of minutes thank you very much for correcting me on that um just for the record we do have a public hearing schedule to start at 6 45. um the next agenda item is 15 minutes so we can do the math but I will at 6 45 reopen and look for the crowd and see if there's any anybody that wants to

13:01 provide public input on the public hearing so yeah so the next agenda item is Deborah art and the proposed budgets and prices collected but that's time which is again that number two it's a very capable finance manager Tia Marie Harwood Deputy Commissioners and staff uh T Marie Harwin financial services manager and with me this evening is Aaron Ballmer fiscal services supervisor and Alicia holder please lead financial

13:47 analyst so we were before you last month to discuss the updates made to the long-term Financial plans and the draft budgets that staff prepared this evening we are here to review the 2023 both budgets and updates to prices which will be followed by the first of two public hearings after the public hearings we will seek for direction on the 2023 proposed budgets and prices thereby allowing staff to prepare and bring forth the final 2023 budgets and price proposals for the December 6 board meeting so with that I'm going to hand it over to Aaron to provide a summary of the proposed budgets and presses thank you Tia good evening commissioners so as part of the materials for this evening the draft budget document was

14:33 prepared into additional details which I won't cover in the interest of time we're certainly open to any questions you may have on the information presented there so on this slide is a grid representative of the four buckets monitored for Budget Authority foreign policy establishes that each utility shall have an o m and the capital budget details and attachment one of the budget document correspond to the figures noted on the screen I will say a quick note for next month is the staff anticipate requesting budget amendments for the current year so at the October meeting draft budget Figures were presented and since then staff have compiled further detail on

15:18 draft budgets and price proposals consistent with the VA they're not any substantive changes from drafts presented last month now in the spirit of full transparency classifications of balance sheet changes for the electric utility were refined in the electric o m figure has decreased by 3.1 million dollars from figures presented in October this is a presentation item with Zero Effect on Revenue requirements previously as a special note with respect to Liebert that is that the current budgets include two million dollars for emergent work funding for the path forward there will be further developed and defined in the context of the 2024 long-term financial

16:05 plan of the planning cycle so financially there we have plenty of run whatever so as a recap to revenue requirements for 2023 and remembering where long-term Financial plans indicate we need to go into the future the water utility is modeling a six percent Revenue requirement increase for 2023 with further increases needed in coming years to support planned infrastructure Investments most notably there are large storage projects in the Willamette treatment plant on the horizon price proposals for 2023 allocate increases evenly across billing components for each customer class the electric utility is modeling a three

16:52 and a quarter percent Revenue requirement increase for 2023 and projecting the same thing in each of the next three years 2023 price proposals for the electric utility emphasize the increase in the basic charge for residential small and medium general service customers emphasis on the basic charge in these customer classes is meant to capture results from the Cosa indicating a higher basic charge for better match fixed costs I think in the context of rate making principles this is a step to further employee rates on a cost basis business growth and retention credit is proposed to adjust to zero this credit is calculated annually based on the

17:38 difference between the forward price curve and wholesale markets and the average energy price for retail customers to win wholesale prices are less than retail rates in the incremental value a new customer load brings is shared between UAB and custom since 2023 forward prices are above retail is reduced to see one and final note on this slide is that the pilot time of use rate schedules are proposed for removal the pilot program has proved Concepts considerations for future products and services when we have one customer on the time of use rate they are transitioning off at the end of the year current process requires additional

18:24 administrative effect as it is manual a new Billing System is part of the eweb Enterprise Solutions project will better enable future time views of great options so Cosa eweb's cost of service analysis is a mechanism by which the utility allocates its costs among customer classes there are many rows of numbers on this slide but they tell a story last year staff brought a multi-year closer to the board it provided a three-year rate trajectory based on projected information we had at that time 2023 was year two in that analysis and is the top row of numbers this is where

19:09 we thought we'd be a year ago because in the second row are calculating following changes in a long-term financial plan in 2023 draft Revenue requirements and consumption figures among customer classes were consistent from last year until now represents price changes among customer classes for 2023. those prices correlate to the results for retail customers and correspond with the updated results for all small customers per contract terms those proposals for elevation charges firmly incorporate the principle of gradualism while maintaining sufficiency for the 2023 increase for this customer

19:54 class to three times the overall required an increase of six percent three tables with further detail in the price proposals provided with the meeting materials this evening moving on to the electric utility similarly last year staff brought a multi-year Cosa to the board provided a three-year rate trajectory based on this is the top row of numbers figures in the second row are updated based on a roll forward of the Cosa model using 2023 draft budgets and the bottom row represents proposed price changes among customer classes for 2023.

20:42 propose changes among retail classes correlated tickets if you want to highlight the shift in the large general service class that is the result of a customer class audit and shifting activity among customer classes overall customer accounts increased though the large general service customer class is now receiving a smaller piece of the cost pie compared to last year comparatively costs allocated to the medium general service class saw increases but some customers previously included in the large general service class have shifted to the meeting excuse me in the context of holding flat the

21:28 street lighting customer class fragilism is employed so as not to unnecessarily reduce prices in one year only to have a need for larger increases in the future year Coastal modeling indicated an increase needed in 2024. finally in private lighting prior year results indicated a 26 percent increase was needed for 20.2 fragilism was employed to smooth rate impacts over time 12 increase was implemented last year analysis indicates further increases are needed and as such they are

22:13 so affordability is a core value and there are several comparative measures shown on this slide in the upper left combined electric and water bills equate to just over three and a half percent of median household income this measure has shown a declining Trend over the past five years through the Deep racing by just over half a percent this is indicating increasing affordability for customers Oregon governmental agencies consider households to be energy burden or energy bill is six percent more U.S average all-electric customer with consumption at levels used for purposes of the nhi affordability measure that's 1050 kilowatt hours

22:58 households making twenty four thousand dollars or less would classify as energy burden for a single family all-electric residents as modeled in the bar charts the household making less than 34 000 will be classified as energy work the web continues to uphold the customer care program which provides approximately 10 percent of annual average Water and Electric expenses to at least five percent of the residents these levels of community support periodically heard an additional scale by donations from

23:43 lower right on this slide Consumer Price Index tracks inflation across Broad year-over-year inflation as of September 2020. it was 8.2 percent within the proverbial basket of goods and services used to measure CPI electric and water services are specifically to items career inflation for water is measured at four point percent remembering the proposal for eweb welder is a six percent increase to residential customers I'd like to highlight with a six percent increase the water utilities positioning for large storage new projects these large investments in infrastructure we normally positioned to propose

24:36 for electric service inflation there has been at fifteen and a half percent year-over-year all the proposal for Human Service is to have a four percent increase our insurance so the bar charts are showing current pricing among comparator utilities it's not a proposed pricing all right water utility is showing Headroom among comparators and the electric utility is leaning to the right of the middle back so dollar amount increases at proposed rates and if these comparative consumption levels dollars and eight cents for the electric utility in 2.11.

25:27 finally I'd like to acknowledge efforts by staff this evening building the budget is a heavy lift and it's a collaborative effort across the utility and I want to highlight dedicated and knowledgeable Finance team behind this work summer here this evening in the room and I know others are watching and I just want to say thank you for all the effort and work done to bring us this far thank you very much uh very informative so we've got only two minutes left in this particular item but we've got a public hearing scheduled at 6 45 we're way ahead of schedule and I know we've got one commissioner who's got a lot of questions so you don't mind I'll just add this to that and go for it all right thank you uh thanks for the

26:14 presentation and that additional information I'm happy to see us looking at the rate compared to income I think that's super helpful and um you know some thanks for doing that um I also want to say that as as always you have created a budget document that I feel like I can read um and even to the point of putting footnotes on exactly where I'm going to ask the question right you see you know how I'm reading this right there's some some something different than last year and scratching my head and there's a footnote that says well this is why that is so thank you for sparing me a whole bunch of questions that way um and just for the thoroughness of the work there um

27:03 I appreciate what you just mentioned about inflation and our rates just to make a note that we're in a period of just extremely high inflation right now and our rates like some of them are projected to go up by five percent or so which makes me a little uncomfortable but still from my perspective under the rates of inflation so I think is on the mobile that's it's great I also want to say um forgive my ignorance this is just the second time I've gone through a budgeting process so I have some questions that are a little more procedural and uh ignorant perhaps by apologies for that um and then I have just a handful of questions but they're in no particular

27:48 order um one you have the we have the breakdown of the proposed rates for the Waterside and the electric side and the Waterside had um detailed revenues right it showed the proposed rate and then what the overall Revenue would be um and I can give page numbers I think that's probably useful just to kind of go through here a piece at a time so um the the water price proposal section has

28:34 on page 22 shows like the the annual revenue based on different um based on the proposed pricing but the electric side doesn't do the same thing doesn't break it down in that same way uh is there a reason we don't break it down that way on the electric side I just found it really helpful to see how this was broken down and how kind of each of these pieces uh built the whole Revenue um and I didn't see on the electric side table number 13. I think all the yeah all the rest of the information is the same it's just that it's just that Revenue kind of aggregate Reckoning points

29:31 good question thank you nothing urgent I just found that found that helpful and and kind of building on to that is my question about non-rate revenues that are grants or um our our um our line of like green products and actually that's part of where my question goes to I'm not sure where or if that green product Revenue line shows up in on the electric I guess that's it like I don't see the revenue side kind of clearly on the electric side where I can understand oh that's ill and so again going into that question about the green products I know we had we've kind of given the nod as a board on a green products line spring if I'm not mistaken in april-ish or something and um so I suspect that's

30:17 baked into this next year's Revenue um do we have any detail about what that's expected to do provide that we can provide that detail it's rolled into other Revenue okay so we'll go ahead and provide that information if detail okay great thank you um all right and then just a you can stop me anytime around um hello all right cool um on so then I'm gonna go into just the overall budget document and on page 14. um there's I'm looking at the electrification incentives so last year it was six hundred thousand dollars and

31:02 this year we've doubled it looks like to just over 1.2 million and I understand and appreciate them back and forth and um uh in advance of the call so I understand this the electrification incentives are both for transportation and building incentives do you have a sense of what what part is what like is that mostly EV incentives or is it mostly building incentives or is it we have a sense of God that's broken down I believe it's mostly for abs freebies because we have funding coming from the state to help support our guests because you know a lot of that is tied for particularly the value of clean fuels credits right and those are continuing to increase when we monetize

31:48 those right um so it's basically the state in this case is placed a value on carbon emissions right and Emissions reduction and they're feeding that back into organizations like eweb and we in turn right use it for that additional purpose right and in the pre-media back and forth you suggested that might have something like that for buildings in the future that will help us make these Investments more economic level yeah I I think that um when you look at a lot of electrification if it stands on its own economically it's a it's a challenge for the utility for a utility that's actually in the Northwest where it's the the return is very

32:33 difficult but if you monetize emissions reductions and can use that then there's the additional incentive of of the the value to the climate so that was sort of the basis for your response to your earlier question right so the I guess my question is how much of this total incentive what 1.2 million that we're proposing is sort of buildings and that's coming from ratepayers um and how much of of that then is going to pay the utility back or is that I mean if we're spending quarter million dollars on incentive Seven Nations making that number up I don't think that's probably what it is but maybe some in there somewhere in there and we're spending a quarter million dollars on incentives for electrification are those gonna likely

33:19 to pay the utility back important no and so do we so we've done we have some assessment of what amount of like economic uh ins of what amount of electrification incentive pays back utility and you feel like it's less than 250 000 a year whatever the hypothetical number would would be that's that's where um there's the couple of challenges to that is that um the amount of incentive to drive Behavior right will need to be significant enough of which the utility would then have to recover that in their in their retail margin not just their

34:04 retail rate their retail margin right and because we're relatively low priced and low margin that would take an incentive that's greater than what we could provide to to alter that behavior right I don't think there's much in the way of incentives for buildings that pay us back at this point right there are some game changers to that so I want to be optimistic about that the a number of the state and federal programs the IRA program for example is a game changer there and also if there's a monetized price on carbon that goes beyond the clean fuels credit or as part of a program like that would would definitely be a game changer for Utilities in the Northwest like anybody right okay but absent those policies is not going to

34:49 make thank you I appreciate the yeah me understand that um all right going to page 18 on a totally different topic I'm looking at the alliance um yeah page 18 in the in the whole budget document there the line on insurance um and you even made a footnote you said the insurance premiums increased they went from last year from 1.1 million we're almost 1.2 million to two million dollars budgeted for this coming year um can you speak it out to the drivers behind it says the coverage includes property liability and cyber security guessing that fire insurance has gone up I'm just curious like it's I mean she does a huge jump and I'm wondering what

35:34 that is can I just jump in on that was another question I had and it was answered in in the pre-reading my apologies I missed it I'll go back and read it since it's in there because I think it's a pretty good explanation all right let's get that down I was gonna have to look up that one to make sure I didn't conflict myself oh yes thank you um all right so then I'm going to the electric price proposal um on page 18 to table eight

36:20 and I think I'm writing this right but I'm not sure but um when we look at the percent impact on bills so it's um it's broken down by the usage range from smaller users at the top purchasing large users of electricity in ranges at the bottom and the percent increase in price is like 6.18 for small users but then the percent increase in price tapers down to like three percent for really large users like 26 . um so we're having a higher rate increase in the way I'm reading this

37:06 higher rate increase for smaller users and a lower degree increase for bigger users is that right that is a function of putting the majority of the rate increase on the basic charge cost recovery component just baked into this table let's see okay so there's a there's a bit of I think then there's a bit of a regressive um qualification to our right there's regressiveness built into our rates right am I is that right so when we review the cost of service this year our model did indicate that our basic charge was insufficient to cover the fixed costs associated with

37:52 that and so that's the effect that you see is a proposal that is assigning fixed costs to a fixed charge right so for our lowest users they will see a higher percentage increase then our hot our highest volume I guess I'm just I'm concerned that I suspect that some of our lower users although this may be an incorrect assumption but that some of our lower users are families living in smaller homes as opposed to I don't know does this disproportionately affect lower income people so in our households generally what we have found is that our low-income households are spread across the entire usage range okay and so it

38:37 could be inefficient housing or energy homes large families living together so they really go across the entire consumption Spectrum okay okay but that's that's what we've found that's pretty consistent with other utilities that have done the same kinds of studies it is Progressive utility rates are progressive in the sense of the amount of money that you spend on disposable income um relative to what you're spending on a utility bill so it's it's it's Progressive in that or sorry it's regressive in in that sense um however if you align it with cost then we have a very large fixed cost component right and so what happens in

39:24 in from a cost perspective is those who are using less which are still they're still paying less but they're not absorbing their cost they're actually being subsidized if they want to use that word by those who are large consumers based on on cost um so but the Costa revealed that in the sense that the basic charge was where we were in sufficient okay all right thanks I appreciate the context there that's super helpful I think I only have two more John one more um actually I don't see it flagged on here but I believe I looked at the budget line item for incentives for low income

40:09 customers um like the amount that we've set aside customers is the same this year as it was last year is that right you don't expect that number to go up we do periodically evaluate that um and it also is some supplemented with customer donations as well if we find that there's a driving Factor so during the pandemic we tapped into that so those funds are available as well but we do periodically review that okay and we feel like it it needs to need I know we we talked earlier about well it was really related to leiberg increasing cost and how is that going to affect that

40:57 actually especially concerned the ones that don't qualify for those low-income supports and the people that are just above that but I guess that we feel like we're sufficiently covering the base for low-income households at this point okay that's all I have thank you we owe you a couple of answers and thanks so much I think procedurally I'll just keep the queue open and if people have questions or comments because after the public hearing we the next is Direction anticipated of people testifying I don't have anybody who signed up and testify so anybody else have any questions or comments Sonia

41:43 we're introducing it you said something about three times the rate that he spent was that some kind of coloring of the water all right can you talk a little bit more about that I'm not familiar in the in the context of the elevation charge proposed increase at 18. just trying to to frame it on that context there's still more there it's just that we're going to spread that out over it was just a decision that three times others had

42:34 been part of it and then so we'll recover that over how many years each year we're looking to take a step in the right direction there but in your estimation that's

43:20 get to the to cover the 41 minutes that like three four five years ago okay okay let's say it's near term you've been given where we're at with these updated results 7.7 we're taking 18 step towards that so in the next year or two I would expect that like they would do another 18 next year and then that would be that would be I'd expect we'd be sized for elevation charges um how did we decide or how what was the art form bearing Us in the differences between HOSA and then what was proposed

44:07 on kind of the other rates because it looked like some of the other rates were you know higher again the gradualism side of that is that just okay we'll add a comments to make that or what what's the reasoning expression behind that speaking to go back I'm moving here just an FYI and they're not looking at what you're looking at I think it's something different from what you're looking at so Carlson is is it part of your um

44:58 I'm changing here but it's not changing there I was just going to ask if part of your question is related to when we employ gradualism what period of time are we trying to to recover over 10 years three years five years yes that's that's the base that's a good question so we're looking so this was a three-year Cosa and generally we were looking to by the end of this three-year close-up uh smoothed out and corrected okay so if you take three years if it's the numbers easy 30 then you would put 10 on each year roughly I mean once you hit a percent then it kind of changes the next percent there will be complicated there will be a new post

45:44 that but at the end of the that was part of the multi-year Cosa to give us more of a Runway to understand where we needed to make changes and the electric had an example of who I'm wearing one year it would have been an increase in the next 15 degrees so enabled us to smooth that across um three three years I go to the one on the lighting I don't we talked about the gradualism for the street lighting one now that I don't understand because the Cosa says it's a two-year coset and there's a 3.43 increase but then the updated results say it's negative surprised that that's negative for one but then also then it's just flat for

46:30 that so I think is the update an update to the Costa for this year and the Costa is now saying that we don't need to change things correct yes based on the updated uh consumption and demand data and customer number data that we've gotten very interested for this year that the course results show that we don't need to read Sprints we did it enough last year that so it's covering the cost of that service well I I don't know if you have this information but at our Eclipse asks so you mentioned that six percent roughly equated to a household that was

47:17 100 electricity it being 24 000 or less would be energy burdened on the other side of that um what is the income range of those that qualify roughly the typical household that's modeled there that qualify for income assistance is that 24 000 or is that higher is it lower what what threshold do those folks typically qualify at in front of me can I clarify though um that was a a new measure so the 24 000 is at our average consumption and would be inclusive of Apartments typically that would use less and that's where we calculate our mhi and then we work that

48:04 calculation and the 34 000 or was it 36 is for our average all electric household that we show on against our competitors but I'd be happy to get you our income qualifications yeah after you just follow up I'd just like to know okay everyone correctly you're saying that you know we're under the burden but for those who are burdened we kind of make up for it in this way you know by providing energy assistance and that those same people are maybe there's a percentage of them that qualify thanks that's it for Me Andy any questions or comments there really small one um I appreciate the multi-year process rejection it's always helpful and um on the the slide that says

48:52 affordable where it shows where we are compared to our um other utilities this is not specifically for this budget now but um I'm just curious is for future we'll talk about Weaver when we anticipate what our costs are going to be if you could um show us a graph like this where it kind of projects like where we might be I know you can't anticipate what further utility living people I feel that this kind of chart is really helpful comments um why did we change the comparator cities most people

49:37 because everybody rates are about to charge and how come they're not there anymore so one in particular uh with that uh prior comparator chart uh we had multiple satellite communities that were all served by Pacific Power so when we we had them presented in the graph and we surpassed Civic power utility level but how we Stack Up Just

50:27 I'm just thinking about water and you know the standard rate in Coburg or I suppose 100 bucks options and don't have any of that up there but we've got Portland yeah I'm just wondering which one to me is more comparable because there's a lot of people using that you know that kind of just wondered why that changed and basis for that was he explained the basis we we can actually slice and dice this however it seems like it makes the most sense on the water side to do it by City because most water utilities are based by City but when you look at the electric side doing it by utility because utility

51:12 territories are much different some of them are municipal for a city but um we can you know Pacific Corps for example covers you know a huge swath of territory but we can modify the cities to include some more local ones on the water side that makes sense I'm just saying we've done it for years and then it's changed so just making that kind of observation it was an attempt to provide greater Clarity particularly on the electric if we dropped a comparator that you would like to see we can certainly add that back in and we may have missed the mark on getting all the right comparators in this time yeah observation the other question is I don't know if there's a policy or not but we're basically refunding Second

51:58 Source in the rates you just said we did that 10 years ago and then stopped and we refunded rates but now we're pre-funding it again where we made a comment that we're putting money in there why aren't we doing that with labor what are they saying with respect to water there on but again for example the six percent that we're proposing with with the second source and also the storage work that we have so we have this capital Maybe you know it's on episode

52:44 certainly are going to yeah position ourselves to accomplish the Capital One yeah because I'm saying that because when we start raising rates for Lieber it's going to be it could be monuments anyhow uh I'm just wondering why we pre-fund one and we don't prefund the other so technically today we are not pre-funding Second Source but because we have a large infrastructure project going right now with respect to the two tanks because you'll see we actually do have a uh budget draw this year that rate increase is helping to fund that and position us for the debt that we'll need to assume Per Second Source

53:30 so there isn't an amount of cash and yes we did have an AWS Reserve for for many years now with respect to Lieber that'll be one of the options that that will bring back next year when we open that discussion um ranging from pre-funding timing rate increases with our expected debt issuances and or smoothing that and any combination of the above so you will we will talk about that in 20 to 23. um my point is that if Bond rates are rising which they are and we could put money away now and we know we have to

54:16 spend 180 200 million minimum I wouldn't say why don't we just one percent or whatever just get a little bit in there and because our bond cost of our bond money is going to be a lot more again than it is now for someone to make sure that we can address that in the future so that's it with me president Brown I I fully believe that with over the next year we'll be having discussions about the financial plan for Lieber and how much of that we pre-fund how much of that we leave for flexible borrowing

55:04 schedules and and things like that based on the risk most of the costs are occur late 2020s to mid-2030s we have a little bit of Runway to develop that financial plan which could include pre-funding as early as 2024 and that'll be part of the discussion that we have with the board over the next year okay we've got about five more minutes before the public hearing starts uh Mindy let's propose that we take a five-minute bathroom break in that five minutes is that okay convene at uh 7 45. it's 45 sorry

1:00:08 all right 2022 general meeting of the regular meaning of Eugene Water Electric Board the next agenda item is the public hearing on upcoming year with guns and expenses for Testimony I'm gonna wait for the next general item is a budgets and prices Direction we're asking for board um directions tonight on that 2023 proposed of water and electric utility but it's a present puzzle sent it into board materials and staff will take the direction to prepare and final utility budgets and we will look back

1:01:01 look yeah you're good uh can we turn it off thank you I'm glad you're good with the questions you presented that they won't stop okay with what he asked that affect how you come back with more information that detailed Revenue was going to be a small amount any direction uh Sonia you're coming I mean the only the only thing that that resonated with me really

1:01:54 just made it still it's a great increase and I I get that I I kind of concur because if the economy keeps going and inflation keep going the way it is trading Creek now is not going to be the same as it is to hear from now um you know that'd be more respectful on the people that affects them and so I don't know if it's too late to change it but you know and man you have a comment then Frank yeah I have a question because I think I brought we have the same question uh either at the last session or before that my understanding was that if we set aside dollars now we we you're regulated to keep our investments at a very low interest rate and inflation is kicking and we will effectively be losing dollars setting

1:02:39 the aside is that right that's how I understood it if you consider the fact that it's not our money then the alternative for customers I I guess my my thoughts on the social in essence you're you're right if you look at it from a customer perspective in other words I can give e-web money and they can invest in a low rate in in the meantime I have other options or I have an inflation that is outpacing that um I I guess I would just suggest to the board that we we still have some direction to set we we don't know what the full story is with with Liebert and until we actually have that

1:03:24 um I don't know that that I would be asking customers to pre-fund something that we haven't that of course or a direction on yet I think part of that course and direction is going to be the financial plan um which I think will we will develop um so I I would not be inclined to recommend that we refund starting in 2023 um I suspect we will have that discussion about whether we've refund starting in 2024 so that would just be my recommendation at this place I'm good with it Steph good with what we have yes they basically no comment is no Direction but what you presented is good that's the way I interpreted it thank you bring back essentially the same

1:04:11 thing absolutely and I'll make sure I schedule enough time for it president I would known because he requested it that uh I think we are going to set some time aside for commissioner barovsky leave at the last meeting he had requested some time with staff so we want to be able to entertain him just so the rest of the board knows that we'll be meeting with him separately that's fine and because I know the budget is his baby I really likes that stuff so let him have okay well thank you very much for a good presentation we really appreciate it um the next agenda item is going to be the uh quarterly operational strategic goals report Frank Lawson yes president Brown Commissioners uh thank you good evening

1:04:59 wanted to vote go ahead with the next High Holly I think we keep control of it up here um it's it's hard to imagine that we are reporting on Q3 already uh given the fact that this year just seems to have kind of flown by a number of updates just generally um uh quarter three uh had really our first implementation period for our Wildfire mitigation plan of which the board approved in that quarter we implemented a lot of it early in the year uh when the Fire season hit we also in the third quarter experienced our first Public Safety

1:05:44 power shut off the weekend after Labor Day and know that we break the board on on a lot of that already supply chain issues I I do have to complement um really not just our procurement staff which has done a really good job of mitigating that but also the people who work and schedule and plan activities and operations whether that's responding to customer needs or planning for projects or also applying for emergent work we've had to shuffle a lot of those projects around to be able to accommodate where and when and how we can we can manage materials through that a number

1:06:29 of significant project advancements including East 40th if you haven't been out to East 40th and peered over the The Edge you'll you'll get to see the foundations of two tanks and then when I was out there the other day almost a circumference completed on the the tank to the East and it's it's very impressive I'm very very large and will serve the community for a number of years so that project has has progressed well we also in the quarter um for the first time in a couple years got some results from a customer survey this was uh one that was a little more in depth at us some different kinds of

1:07:15 questions around priorities not just do you love eweb or not or why but um asking customers to prioritize different activities in in alignment with our values and so that was something noteworthy in the quarter and also you know we continue to make progress on a number of the the customer facing programs including our Energy Efficiency work which is year-to-date at 100 over 100 percent of its Target but also well under its budget and some of that is just because of the mix between commercial and residential as higher commercial content so far this year and then the the ever popular surprising e-bike rebates of which I know at least one commissioner has taken advantage of

1:08:01 of that and 542 year today through the through the third quarter which is fantastic and in the meantime we're still making progress on our goals I wouldn't say that um it's somewhere between nine and ten of the 14 sub goals we're still on track the ones that uh go ahead and Holly with the next Slide the ones that are are not on track are more we're still making progress not quite on the schedule uh that we thought but we continue to work through our total uh goals looking to um whether that's a little bit more operationally focused or also whether

1:08:46 we're looking at some of the Strategic projects uh going our goals going forward that support our long-term strategy including work going on with the board around leiburg whether it's stamp safety looking at the the EES eweb Enterprise Solutions thank you for approving the authority to sign that that contract with sap which is it really a significant technology Milestone of which it's going to take a really significant amount of effort over the next couple of years to not only bring our our information systems up to where we need to be relative to our business continuity but also sort of set

1:09:32 the table for some of our strategic work that involves on the energy side in particular synchronizing supply and demand and the customer programs that'll support that and so continue to make operational resiliency work for us Sprint the City of Springfield in the third quarter did give us I'll say an endorsement of the project in in Glenwood we also filed an application for rights to Federal stored water behind Federal facilities that's a water rights application for further water rights looking forward

1:10:17 and then also as the board knows did a little bit of a pivot on the headquarters property and the board really delegated thank you very much that Authority said the general manager to continue to pursue opportunities around the divestment of the headquarters property or disposition thereof so I guess with that we do have a lot of Staff available on hand we know it's a pretty dense report one thing I will point out just just format wise is that if you do a sort on cap 2.0 you'll find that in the footnotes throughout the report you can

1:11:02 see where we reference information that's relative to the city of Eugene's climate action plan and reference the section of which we are contributing to the progress of that plan that's in our normal quarter weekly reporting we do have plans to do a a new report which will be the eweb climate guidebook that'll be I'll either end of this year early next year which will have a whole section on what we think our reporting is to the City of Eugene around the climate action plan as as a part of that as well as some other technical application notes and and how we Define things like carbon intensity and which

1:11:49 you know will the real number please stand up kind of papers and Technical guidance and so that's in in process but I did want to point out as we made it we made we did make a commitment to the City of Eugene I think in some of our meetings that we were going to start to highlight in our quarterly reporting how our work was related to The Climate action plan so we did that this time through footnotes and wanted to make that that evident to the board put that up I'll open it up to the board for questions or feedback like I said we have the assistant general manager and executive team and other managers available if you have questions and be happy to entertain them at this time Mr Brown questions comments

1:12:47 if it's in a quarterly report for electric financials decreased 70 million between 2021 and 2022. just curious what that is it's a classification item for your end generally accepted accounting principles or cap requires us to reclassify Investments with maturity greater than one year from current to other non-current assets and so the increase in current assets is offset by a decrease in other non-current assets and the overall change internal assets from 2021 to current is relatively flat okay got it all right yeah that was a great question commissioner Carlson I did look at last year and the same thing roughly occurred last year but if you look at the total assets line it's pretty consistent around that 700 million mark that makes sense and I just saw that

1:13:32 jump one big item one we bought some when you were looking all right and then um I know our rate of return metric is already challenged it's under the target um I'm assuming that that Liebert is not factored in but that when we do have to factor Lieber again that that will be offset by a rate increase is that the case or is that or not often that will continue to be challenged so the value of Lieber assets have been removed um from the Napa Valley for the purposes of this metric so liebert's current in active status is factored in there are a number of variables that play with this metric but all things equal proposed rate increases will help

1:14:18 to improve it foreign I did talk with a CFO Deborah Hart a little bit ago about looking at this metric a little bit differently also you know when you think about rate of return a lot of times you think about rate of return for stockholders or the fact that we're actually in it to make a return We want to make sure that we have a metric that reflects the interests of our our borrowing agencies but also doesn't lose the fact that we're a public agency and we're cost based and so we'll explore that a little bit further your questions are right on relative to Liebert and the

1:15:05 impact of rates but we also want to make sure that overtime is just the right metric to be looking at does the rating Agency use that specifically is that requirement can we have some questions so metrics tell a story when looked at collectively so ratings agencies utilize a whole host of metrics when they review our records so this one in isolation will not impact committee the quick question about the um Willamette I know that we're behind and I'm curious um basically that we're going to be able to catch up to our schedule or will it always kind of well I'll let um your Karen or Wally

1:15:52 jump in or or uh um Mike Masters looks like Karen's appeared hi everybody um I would say yes you know our our timeline that we set for ourselves was really individual and we do expect that you know as soon as we get through that land use planning process we're doing everything we can right now to keep on track beyond that piece and as soon as we get through that I think that we'll be able to catch up to where we hope to be back to the comments I will uh verify that uh yeah that's correct Karen this

1:16:37 is Wally and um we do hope to um you know we did put a pause we we did shift the project out about uh six months during our last Capital planning effort and um so we're on track for that I think but we just have to get through the capital planning efforts um I've got a couple quite a few since the headquarters building that was in in the goals I noticed in your background or you said you had seven serious inquiries and two offers and although I don't want to negotiate it in public uh and knowing about agendas the December's poll and timing um what we anticipate you coming back to us after the first of

1:17:23 the year or before that's a deal I want to comment a couple of weeks the board granted me a certain degree authority to act independently within within the guidance that you provided um if pushing the edges of that uh I mean I'll be in contact with the board uh pretty routinely over the next few months about the status of those either individually through check-ins or collectively if if this decides if there's a in any guidance that I need as the general manager so probably either one but I I wouldn't expect to necessarily automatically schedule an agenda item for this in December

1:18:08 thank you other questions or comments thank you very much Craig thank you president Brown Next agenda item is going to be frank Lawson the hydrogen pilot project thank you again uh president Brown uh so last um month I believe commissioner McRae um got head nods from the board to um for a status update on the work at the hydrogen pilot project with Northwest Natural I think the suggestion was for January but this was a fairly simple thing for us to provide an update on relative to the changes that had occurred over the the last number of months

1:18:53 the the background material that he received really talked about the fact that Northwest Natural leaned back in it was late July filed an application with the Public Utilities Commission for the project and really the rate recovery of the project I do and can inform the board that today actually this is this was not reflected in the background memo but today uh Northwest Natural filed to withdrawal that application to the Oregon puc they did Express to me they are still interested in the project but they feel like it's important to work closer with the local community on on the project so

1:19:40 as of this afternoon I believe that I think the filing was official as of this afternoon that they are withdrawing their application for this in order to pursue a closer working relationship with the local community on the project so um are you know and the point of this and and actually at this slide I included um for you this evening was the same slide that that has been part of the stakeholder and the Outreach which uh really expresses very specifically and distinctly eweb's interests in both the project and then our long-term interests in hydrogen specifically it does not comment on the area of which

1:20:28 I don't believe we're the experts in which is the blending portion of the project which I think is is where some of the local commentary came from and where Northwest Natural is the expert and so our message has been pretty consistent relative to the interests we have both operationally and understanding how hydrogen production can can work from an electric utility perspective including demand response and eventually alternative fuels or electrofuels rates and then the long-term interest around hydrogen as a as a storage or a fuel source or either directly or through some intermediate chemistry so our our

1:21:14 role has been pretty consistent throughout this independent of of the audience and that's what are our interests in hydrogen and what are our interests in the project so I didn't quite expect to give that update today but um basically it sounds like some more information will be coming out from Northwest Natural on what the next steps are relative to the the local hydrogen blending project of which eweb has been a participant coming back to you president Brown questions comments

1:22:00 to be clear there is no project right now great there is no project um uh you know our our discussions with with Northwest Natural with the Bonneville environmental Foundation which has been part of it um I also on the stakeholder Outreach and I actually put a link to the video um that you can see that where they describe Northwest Natural is part of that they describe their project the Northwest hydrogen Alliance as part of that and then also the Bonneville environmental Foundation the the project itself driven the blending project driven by Northwest Natural had to go through this regulatory process with the Public

1:22:45 Utility Commission of Oregon they have sense with as of today withdrawn that that application other questions or comments next agenda item is going to be correspondent support agendas I guess this is back to me um we had two pieces of information one was really around some purpose a purple standards those are I'll say it's really an administrative item as much as anything and then the other was and the Commissioners May Jason Jason on the for the the meeting

1:23:31 um is 2023 legislative session preview document how about the sure that is saying that we need to go with the parking station legal charging stations is that what that I think so actually I'll I'll have is Megan I'd like to have Megan jump in

1:24:16 it's it's a standard independent of of charging stations um herba defines certain standards of which we meet um we have to go through and review the Energy Efficiency and other standards according to that and then file a an amend or a basically a document that we concur with that by by next year so it's it really is a demonstrative process it probably has no substantial um operating impact to from that changes anything that we're already doing um another thing is

1:25:01 you were part of the KLCC rainmakers and I haven't had a chance to listen to it yet but I just wanted to you should we haven't we should all listen to it yeah it's always a little tough talking about yourself and your background but the cool thing was being in the KLCC Studios with all the neat electronic stuff in the microphone in your face and and all that that was actually pretty interesting the rest of it I'm not so sure and um you know I don't know that it's under review what I said but it was fun okay any other questions or comments not board wrap up anybody have anything for the good of the order before I get to go that yeah just thanks for all the uh

1:25:49 presentation tonight the materials accrue it just continually impressed by the quality caliber of information we get really appreciate it work session a couple weeks related to the integrated resource plan specifically we need to make sure that they just want to make sure that the board's aware is it as we go through we have identified all of our assumptions around both the consumption patterns as well as assumptions about future markets and the characteristics of resources this is going to be you put all that in the blender and you calculate an ideal portfolio

1:26:34 this is the calculated portfolio now what we fully expect to do after this because it may or may not align with everything that we think after this we're going to have to iterate this we're going to have to test sensitivities around things like increased electrification around the expenses associated with Locale such as increases or scarcity of transmission so we're going to have to go through a number of iterations but this is the this is the calculator this is we put our best crystal ball forward we turn the crank and this is what comes out so that'll be what we want to talk to the board about in a couple weeks thanks for pointing that out

1:27:21 anything for comments I said man thank you I'm good anything else Craig no thank you for the questions thank you very much