EWEB Board of Commissioners — September 2, 2025

0:03 So, I'm going to call this meeting to order. This is the September 2nd, 2025 e webb board meeting. Um, we're going to start with item Oh, yeah. We'll start with item number one, which is an agenda check. I guess I would like to say for the agenda check is that um we have uh towards the end we have the general manager recruitment process and there's 60 to 90 minutes on there. So depending on how long that discussion takes. Um we might not get to the update on rate design this month. Um, we'll have it coming sometime soon, but we want to make sure that this in this meeting that we spend enough time on the manager

0:49 recruitment process. Anyone else have anything for agenda check? All right, item number two, items from board members and general manager. anyone who wants to jump in and go first. John Brown. >> Yeah, I'd just like to acknowledge um the workers that we have here. It's not only the it's everybody is good in my opinion, but now a special shout out to the men and women that are out on the poles in the ditches because it's 100 degrees out and when it's cold weather they can accommodate where the hot weather they can't. They still have the safety issues. and just knowing our comforts is sitting in here and they're out there working and doing all this

1:34 work. I just like to give the shout out to that group of people especially and acknowledge their extra efforts and and having to deal with the elements. Thank you. >> Thanks Tim. >> Yeah, thank you chair. Um just want to acknowledge again uh I had a constituent of I think Ward who shared with me that he had a huge leak a leak in his basement and through the automatic notification of the water usage that's how he caught it. He caught it early and was able to resolve it. So I this is a drum that I will just continue to beat. But I really appreciate that effort and I think it really is supporting our our customers in in very direct ways.

2:23 Frank, is there anything from you? >> Yes, good evening, commissioners. Just a couple items. Uh, Commissioner Brown, we will pass on uh your comments about field staff. Appreciate that. Um did want to inform commissioners that uh Deborah Hart and Karen Kelly and I met with uh the city of Eugene management specifically um um the city manager and assistant city manager just to tee up some more detailed discussions around the fire hydrants. Um it's um the the purpose of that is to develop some some boundaries, conditions, some back and forth so that at some point uh we can come back to the board with uh a lot more detail and potential options. And so that's an update. And the second one was just an acknowledgement to uh the e-web staff

3:10 who uh has automated the move in move out process which is now available on the portal. um that has already had some impacts uh on our uh customer uh call load um which allows us to spend more time on the more complex issues uh and so really wanted to acknowledge the work that took place to automate that particular process. So thank you. Um item number three, correspondence. Back to you, Frank. >> Yeah, commissioners. There was just one item of correspondence uh relating to uh well, actually there's there's two pieces of correspondence. Uh one relates

3:55 to the the pass through uh of the the Bonavville increase. We had forecasted that to be uh 4%. It looks like um after a number of back and forth Bonavville looking at our own impacts that has been dropped to 2.7% on the residential side 3.4% overall and um planning to implement that per policy uh immediately uh um commencing this next month. And then the other item of correspondence um is the inter uh preview of the intergovernmental agreement with the city of Eugina Brown billing services. Uh this is is specific not to any sort of new fee but um the costs and this is

4:43 cost based of the billing of the um storm water and wastewater fees. And so there's there's an increase of that that has been presented to city staff and um that would come back to the board to this board for approval on consent calendar next month. >> Question if I may about about that topic. Sorry Lauren. Um so it it looks like we were billing 235,000 and now it's over a million. So were we off or I mean how did that how did that disparity happen? Because if we should have been billing them a million all along and we're only billing them 235, how long has that gone on? And uh is there any chance us of us going back and recovering that? >> So two things. First of all, I think

5:28 it's going from about 1.2 a little under 1.2 million to almost 2 and a.5 million. Um some of that is based on the cost allocation. The the greater percentage of the bill, the greater the allocation of those costs and also um how the numbers uh on the customers are divided. Um so I don't believe it's it's um a past error per se. It's just um as we go through and we update um the billing determinants those those get updated. It is costbased. Um don't believe the previous agreement called for any kind of retroactive adjustment. Um but if there's more detail I can lean into either Deborah Hart or Julie McGee who was were part of the discussions. >> No just was curious. that seemed like a

6:14 pretty big disparity from where it was and where it is and knowing that they don't have any money. I'm just wondering how that's going to be received. >> Um in in well um staff that was presented this information and um I'm not going to say it was okay with it there. There wasn't an objection. I I would also say that how they do their billing, the gross versus net would likely be get built into their their fee process. Um um and so and if there was anything I missed, Deborah, on what drove the cost increase, Deborah, Julie, I'm looking over both shoulders. >> Couple of things in

6:59 two. >> There were there were a few things. uh one was uh a more comprehensive collection of our costs specifically as it related to billing rather than focusing just on the folks who answered questions by phone and in our lobby. And uh we've also seen a significant increase in merchant services fees, the fees that uh are associated with taking credit card payments. and we more closely align the city's portion with uh the portion of revenue that we collect on their behalf. So those were two big drivers. >> Thank you. >> Julie, did you have anything to

7:47 >> other comments? I guess I'll say that um I'm really glad to see that the pass through is less than we thought it would be. oftentimes it's the other way around and I know that we have done our best to try to um lower price increases on our end. So, it's good to see that um there's a little bit of relief coming BPA's way as well. Okay. Um we will move on to agenda item number four which is public input. Welcome to the public input session for this meeting. E Web is a public notfor-profit organization whose charter is for the deliver drinking water and electricity to our community. Although

8:33 this forum is not used for an open back and forth dialogue, commissioners and commissioners and staff value hearing diverse perspectives and receiving community input. Speakers are asked to keep their testimony relevant to e webb business and request that everyone share their comments in a productive and respectful manner. Should speakers or audience members become disruptive, they may be muted or removed from the meeting. Um, at this time we have one caller and I believe six uh six in-person speakers signed up to provide testimony. When your name is called, you will have three minutes to provide your comments. The public input

9:18 session is now open. So we will begin with Craig Patterson on the phone followed by Nancy Honor. Craig, are you there? >> You hear? >> Yep, we can hear you. You've got three minutes. >> You hear me? >> Yep, we can hear you. >> You can hear me then, I assume. >> Yes, we can hear you. Go ahead. I'm not getting any feedback. Okay. Thank you uh commissioner e webb commissioners and general manager and staff for this opportunity to to address you. I want to talk about the upcoming biomass contract

10:03 renewal. First of all, the fact that it was a non-disclosure contract, I believe undermines public confidence in a public utility. However, my understanding is that the register guard found out that you guys are paying 8.7 cents a kilowatt hour for that biomass dirty energy. Whereas the BPA wholesale rate is 3.59 cents. A man study found that biomass is 40 times dirtier than coal and 300 times dirtier than natural gas in part a

10:49 function of energy density. So why is e-web paying almost two and a half times for dirty very dirty power? A perspective. The Gilchrist forest sells non uh saw logs for between five and $10 a ton. A cord of Douglas fur green weighs about two tons. So you're looking at somewhere between $10 and $20 equivalent in biomass material. However, then you have to include the harvesting, the transport, the shipping, the drying, and the burning.

11:35 Juxose that with a cord of firewood that runs between $2 and $300 a cord, or 10 or 15 times more as firewood. The second issue I just want to briefly talk about is conservation. The Northwest Power Planning Act defines conservation as the number one priority of the region. However, 98% of conservation programs are deemed or projected without verification. Today, only upper middle class people can benefit from conservation programs because most of them require out-ofpocket expenses. And then when you look at the discrepancy historically

12:20 where the power planning council says we've saved 7,000 megawws and BPA says it's 2,357 megaww. No one seems to want to vet or care about this extreme variation. Today, 20% of utility customers have to choose whether they pay rent, food, medicine or energy. And raising the basic charge undermines conservation in lower lowincome users. Ignores excessive consumption. The general manager of Lane Electric said at the annual meeting that their high the second highest user is an

13:05 indoor grow. >> Mr. Patter is >> excuse me, Mr. Patterson. Yeah, your your time is up. Thank you very much. >> Thank you. >> All right. Next, we have Nancy Honor, followed by Deborah Higgby. I'm Nancy Honor. I live in Eugene in War II. From Frank Lawson's recommendation to renew the Senica Power Purchase Agreement, and I quote, "According to the state of Oregon, the Senica project is considered renewable and it displaces

13:50 generation from fossil fuel sources like coal. It's pitiful to consider an energy source that's compared to coal to make it look favorable. Ew needs to do better than this. I support not renewing the Senica purchase agreement. Biomass burning as a renewable source of energy has come into serious question. As long as there is a market and as long as there is a market for the energy produced by biomass burning, there is an incentive to burn wood from all possible sources, including trees that would not otherwise be harvested. Is there an unbiased watchdog tracking

14:36 what goes into Senica's biomass facility? Or does Eb rely on Senica for this information? Money spent on the Synica contract might be better invested in working on truly renewable and reliable sources of electricity such as ways to overcome impediments to largecale local solar energy generation with battery storage. We would waste time and money on biomass. We can do better. Thank you. Thank you. Next up is Deborah Higgby followed by Jim New.

15:27 Um, hello. My name is Deborah Hickby and I live in Ward 7 and I'm representing the ore Oregon chapter Sierra Club and we would like to express our opportunity to our opposition sorry to extending Eb's contract with Senica Sustainable Energy Biomass Generator now owned by Sierra Pacific Industries in West Judine and our concerns about the lack of public process. Um, biomass is an increasingly contentious source of energy due to its significant air pollution and climate impacts. And despite being labeled as quote renewable energy, biomass relies on and further incentivizes industrial logging, which is the single largest source of carbon emission in Oregon. It

16:13 also incentivizes removal of woody material that is vital for ecosystem integrity because it in a forest it provides habitat and breaks down to become future forest soil. Bio burning wood for energy is extremely inefficient. A 2018 study found that biomass releases more planet warming carbon dioxide per unit of energy than coal or gas. As was just stated, the finding was re reiterated in 2018 in a letter to the European Union signed by over 800 scientists and a 2021 letter to the Biden administration signed by hundreds of scientists. What's more, a report from the Environmental Integrity Project has

16:59 found that the facilities like the one in Eugene emit significant amounts of hazardous pollutants. This is especially concerning in light of the location of the facility which is in West Eugene, an area that has long faced disproportionate air pollution from industrial facilities. In just the 97402 zip code of West Eugene alone, 550,000 pounds of toxic emissions were released in 2019. This accounts for 96% of all the emissions released in the city of Eugene that year. and every every year since then in the it's especially concerning that with a significant controversy around biomass the current proposal to extend

17:46 the utilities contract with the biomass facility has not had a public hearing and has only been public for less than a week. It's unacceptable for EW Webb to move forward with an extension of such a controversial con contract with public without public engagement. The utility must at the very least delay this decision and hold a public hearing and public comment period in order to ensure that this decision is in the interest of e webb customers. In light of this information, we call on EW Webb commissioners to delay any decision on the extension of EW Webb's contract with Senica Sustainable Energy Biomass Generator Facility until a public hearing and oppose the project due to its significant impacts on climate and

18:32 public health and instead invest in local generation, virtual power plants, and energy efficiency programs. Thank you very much. >> Thank you. I also want to note that um Deborah submitted a letter that Holly has um signed by a variety of environmental and other groups and we'll all get a copy of that as well. >> Um next up is Jim New followed by Eric Jura. >> Good evening commissioners. Thanks for the opportunity to speak. My name is Jim New. I live in W 7. Seattle City Light recently entered into a contract with two solar developers in central Oregon to generate 45 and 50 megawatts of power each to offset an expected 1,800

19:18 megawatts of power needed by 2030 due to electrification, data centers, and AI facilities. They are looking to fill this shortfall with solar rather than hydro and anticipation of a low snow pack predicted by climate scientists that will affect utilities along the West Coast. I recall repeated assurances from e webb that the utility has a demand problem not a supply problem when it comes to resource adequacy. It is clear that is this is changing. Other resources will be necessary as e webb considers its new contract with bonavalo power and other utilities face the same dilemma. Local self-contained micro grid energy systems comprised of generating resources and battery storage are key in providing energy to the utility network.

20:03 Governor Kotac recently signed micro grid legislation which will create a process for the PUC to create rules and guidelines for micro grid interconnection operation compensation and require utilities to develop community-owned micro grids by 2030. Renewable energy sourcing with battery energy storage systems coupled with micro grid technology will be key in the utilities resource supply. Bill McKibben's Third Act and 350 Eugene have partnered to present Sunday solar celebration teachings on Sunday, September 21st from 12:30 to 3 at the Campbell Community Center. The public is invited to attend. There will be five 15minute teachings on the basis of basics of solar, solar installation, nuts and bolts, future of clean energy,

20:50 citizen activism, amps up solar projects, and democracy and climate. There will be tableabling, EV and electric bicycles displayed. We hope you can attend somebody from Ew Webb. Also and briefly, burning wood to produce uh electricity has been proven unsustainable by science and is a major polluter when there is abundance of an inexpensive renewable energy resources available. Oh, the IPCC in 2023 states, "If one combustible fuel is replaced with another, we will not achieve benefits to human health and well-being." Despite what the state of Oregon claims, biomass is not a renewable energy source. I urge you to not extend the Senica LLC

21:36 contract another 3 years unless stipulated in the contract. There would be use of a mill waste or slash is the only feed stock not whole trees. Exhaust filters are installed to replace particulate matter and ew webb gets priority access to generated electricity in case of re regional outlets. Frankly, there has been not enough time for the public to be made aware of this issue. It feels like it's a rush decision. Thank you for your time. >> Thank you. Uh, next up is Eric Jura, followed by Stephen Fuller Rael. Hopefully I pronounced that right.

22:23 >> Good evening, commissioners, general manager, staff. Nice to see you again. Uh, four quick items, I hope. Uh the last uh EW Webb meeting, there was a representative of EW Webb's electrical union uh made some comments about concerns he had uh with regard to the relationship between EW and the union and union members and so forth. I'm sorry I didn't just write about this in an email instead of bringing it up tonight, but I just was too busy this this month. Um I was once a member of a union. I support uh the right to unions to to to bargain collectively and all those sorts of things. I don't know who's on who's right or wrong because I don't know enough about this and I wouldn't even hazard it to to get into that mess. I would simply say that I hope that uh you guys can can work it out that and the the uh the issues

23:10 whatever they are can be resolved satisfactorily for both sides and and and that uh um that'll happen fairly soon. So I it was a little disconcerting to hear that. That's all. Uh number two has to do with the race uh that you announced the BPA pass through. very happy to hear that my rates will only go up 2.7%. That's always good news. Uh I'm not totally irrational when I say that I'm very concerned about rates in the next 101 15 years. Uh given climate change and the increase in demand for electricity and so forth, I don't see how we can avoid some pretty steep radius increases. So I'll take the win and and and we should celebrate this little piece of piece of good news. Um, number three, uh, there was an article in the the Eugene Lookout, um, actually

23:56 it was a community, uh, community input that had to do with rate, e-web rates and so forth. And, um, making the fixed portion of the of the electric charge uh, be based uh, be um, be a progressive rate based on the income of the rate payers and so forth. I thought thought that was interesting. I don't know if it would work or not. I'm not even really sure why it chose just the fixed portion. Uh anyway, if you I hope you saw it and and we'll take that into account. I know that EW Web has spent a lot of time and the staff have spent a lot of time working on trying to figure out how to keep rates under control. I appreciate that. So, this is but that might just be another piece of the puzzle to help especially people that are at the lower end of the income scale because as I've heard many of you say, you know, it's it would be a terrible

24:41 thing if people can't get water and electricity because they can't pay the rates. And I know you I know you support that. And then finally, um I've been following a little bit the um the work you've been doing on substations on upgrading the substations and so forth. And I note with pleasure that the one you've been working on recently is the one that supplies my home. So, thank you very much for doing that. Have a good evening. >> Thank you. Uh next up, Stephen, followed by Mark Rabinowitz.

25:29 Good evening, commissioners. My name is Steven Fuller. I live in Eugene and I'm an Ebayer. We have a heat pump in the home. We drive an electric vehicle and use electric assist bicycle for short trips around town. I'm grateful to EW Webb for rebates making these transitions smooth for us. Thank you. I'm also active with several organizations in the Pacific Northwest opposing false solutions to climate change. However, today I'm speaking for myself. Last week, Jim New who spoke to a moment ago from 350 Eugene sent you a paper explaining why biomass energy is not a is not clean or renewable strategy to reduce CO2 levels in the atmosphere. I sent the same

26:14 information to e-web staff back when the board was working on your long-term strategic power supply planning. I hope you have had time to read this paper. It is possible that you may decide to ignore this information and rely on the IPCC and the state of Oregon's classification of biomass energy as renewable. If you do that, I strongly suggest that you include in any agreement with Senica, an escape clause from an binding commitment by EW. The global recognition that biomass energy is neither clean nor renewable is gathering momentum. When the IPC inevitably modifies their policy and when this change eventually percolates down to Oregon, it would be a good if extracting Eb for any commitments with

27:01 Senica could have less impact on your rate payers than extracting EW from nuclear power supply contracts in the past. In in conclusion, I trust that you will do what's best for us, your rate payers, and for the planet. Thank you. Thank you very much. Uh, last up is Mark Rabinowitz. >> Uh, good evening. I urge e webb to expand your website to include a greater discussion of the western power grid, wet, western electricity coordinating council. There's a slight mention but doesn't

27:47 really discuss how the western power grid is the system that e webb is but a small part of there's no mention that natural gas is the number one source of electric generation in the west that the increase of electric generation in recent decades has mostly been from natural gas and no one's building new big dams and a few have even been removed for fish habitat. Instead of advocating for more electricity, we should advocate for less electricity, less of everything, less air conditioning in this room. Maybe uh we need to consider the earth is abundant and finite. The recent closure of Boardman was

28:33 replaced by natural gas. But natural gas for conventional wells has mostly run out. And 34 of the natural gas flow, as you may or may not know, is from fracking. And fracked wells don't last as long. They're more polluting, more expensive. Regarding Senica so-called sustainable, um discussing or rubber stamping this on a day of high air pollution is maybe appropriate. We have known for thousands of years that deforestation causes desertification. This was seen during the days of the Roman Empire and even before and it is one of the main factors behind climate change that has led to an

29:18 increase in forest fires. Clear cutting destroys forests. Senica and their new parent company clearcuts and sprays 24D over their clear cuts which we called the agent orange when it was done in Vietnam. It causes cancer and birth defects and birth mutations and other problems. Um, El Rapid refused to even put a camera in front of the hopper for the incinerator over there to make sure only logging slash was put in there. And driving logging slash from the forest to the mill is uh requires a lot of diesel fuel. I've used solar panels since 1990.

30:05 They're great, but they're not going to replace our current consumption. Pun intended. We need to power down, reduce consumption, reduce our greed, stand up to the data centers, and say we do not need endless data centers everywhere. And we need to focus on what's going to be needed for our long-term survival as a species in an ecosystem, which of course we're not doing. Thank you very much. Um, so that was our last speaker. Uh, the public input period for this meeting is now closed. At this time, commissioners are given the opportunity to comment if they

30:50 choose. Is there anybody that wants to make a comment? Tim. >> Yeah, I'll just um I say thank you for everyone who came out and gave public comment. We're going to get into the conversation, I think, of of the Senica deal, I think, right after this. So, um uh that's on the the delegate, so I won't jump in too much. I just wanted to say, um uh Jim, thanks for sharing the event that's next uh in the couple weeks, the Sunday event, and Eric, thank you for always being on top of everything. Uh so, deeply appreciate it. And thank you. Um uh and and yeah, just a general thank you for everyone who came out and spoke today. I too would like to thank everybody that spoke. Um just a point from my

31:37 perspective and things and Jim I thank you for that article but I think that technology that you cited about the pollution in those biomass is not the same that Senica employs but Senica doesn't there's a kind of disinformation they don't go out in the woods they don't bring slash from the woods and things they don't burn that they only burn byproduct from mills and holes and and shells from uh filberts and and hazelnuts and things like that so they're not out there when I first was involved And in this 20 years ago, um we went out to the woods and we saw that there's a new way that they log and they bring everything high lead, they pile it up and at that time they were chipping it and everything, but it turned out that that wasn't clean enough for the system. We have El Rapa that's not that's monitoring this. We have the state of Oregon that's encouraging it

32:22 with tax incentives and things such as that. So I think there's some information that maybe needs some clarification because you know there was that concern before that they were out cutting trees. No, that's not true because trees are worth a whole lot more as lumber and or wood chips for paper than they are for biomass and uh and they don't burn like that way. They they using byproducts from mill operations and things such as that. And if that's not correct, I will be corrected by the record, but I think that is correct. So, thank you again for your comments and uh we'll have a discussion later this evening about the contract. Thank you. >> Right. Thank you everybody for your public testimony tonight. Um, we're going to move on to some board action items starting with agenda item number five, which is approval of

33:07 consent calendar A. Move to adopt consent calendar A. All those in favor say I. >> I. >> All right. Sent calendar A is passed. Uh item number six, approval of consent calendar B. >> Move to adopt a consent calendar B. >> Any discussion? All right. All those in favor say I. >> I. >> Okay. By consent calendar B is approved. Um, now we're going to move on to agenda

33:53 item number eight, which is resolution number 2516, uh, about the Senica contract. Excuse me, President Schllber commissioners. Good evening. Joining me up here is our chief energy resources officer, Brian Booth. And uh you received some background information on resolution 2516, which is a short-term extension of the uh Senica sustainable energy agreement originally started in 2011 with some much more favorable terms um

34:40 specifically negotiated financial terms. Uh just a little bit of background and um I do want to appreciate the public testimony from a couple of perspectives. Um one of them is that um I think it's really important to understand that when EW is looking at our strategy, we're looking at our portfolio. Uh we do place a high value uh on things like conservation on understanding that this is a portfolio. We're looking at a a balance of of interests and issues. Um the board has set forth for forth policy um around the cleanliness of our resources um balanced with also guidance around economics. And so um what we're asking

35:28 for here is is relative to um a just on name plate on a name plate basis just under 20 megawatt megawws. And this is not um and I think terms matter strictly a biomass facility. This is a combination uh heat and power plant which is I call it a co-gen plant. So it has more efficiency than just um burning wood um for a woodf fired generator. Uh the operating characteristics uh they do have stored fuel. It has a high capacity factor. it does receive renewable energy credits which are part of the value of the facility uh that we're looking uh for. It's it's an unfair comparison to compare it with a a

36:14 strict energy contract for example from a Bonavville Power Administration. Uh and they did go through the clean air cleaner air Oregon uh program and in reaching out staff directly reached out to Elraa to talk about their uh compliance record and um their mode of operation the measurements and the process they went through with Cleaner Air Oregon. The resolution uh itself um again favorable terms short-term extension um it's it's nonsubsidized market neutral um that's defined in the resolution. Uh the purpose there is to give the organization flexibility as we see several things occur in both the

36:59 operating environment the markets and also the Bonavville contract. Um so uh the Bonavville contract uh that we're entering into um has uh strict limits around uh its ability to expand um and any other resource has uh typically long lead time uh as far as development or market exposure. And so this is a way to maintain flexibility if this does get applied to load or um balanced into the market. And so, um, we've asked for an extension, more favorable terms. We put some guidance in the resolution around what that looks like. Um, and we would like, uh, to move to approve the resolution 2516 as presented. Um, which

37:46 will give us, uh, a great deal of of flexibility. Um, and does not actually limit u many of the things that customers are asking for around some of their other interests. Um but it does give the organization uh flexibility to pursue that in an environment that is um going to change significantly in the next few years. With that we would be happy to entertain questions or emotion within discussion. So you can approach it either way. President Schwasper Sonia. >> Okay. Well, thank you very much for the information, the background. I I do appreciate all the other public comment this evening too on this topic. I just

38:31 wanted to save my questions for this moment. Um, so when I ran for office almost a decade ago now, um, this was one of the biggest things that constituents reached out to me about and one of their biggest concerns because this the con the original contract was very fresh on their minds and um, obviously because some of the information came out about the market right now. When you're talking about here the favorable revision of terms and conditions, that is a very fancy way of saying that the terms that we're going to pay are going to be in line with our other options that are out there, right? So, we're not paying gobs more that were even mentioned again in the public

39:16 testimony. Um, >> okay. So, I >> Yes, that's that's correct. when when you look at the characteristics that um another way of saying this is um either a an avoided cost if we had to go get it or what we could market it for. I think the intent there is to not to pay a lot for a resource of which you have to sell for less money. Um and so um when we say market neutral that's essentially there's a couple different ways to look at that. We put a little bit of a range around that because as this group know markets fluctuate almost well they fluctuate hourly and so we want to be in a position where we can be market neutral uh with a little bit of flexibility on what that looks like. >> Can you talk to me about the three-year time frame and >> yeah part of the three-year time frame is is twofold. Um one of them has to do

40:04 with the Bonavville contract and its initiation in 2028. The other one has to do with when you do look at marketing options. Um um that would create flexibility if we do want to take it to load. But if we don't want to take it to load, you want to have enough time frame that you can market that for a reasonable amount of return. Um and so three years is kind of a nice balance for that. >> If we voted against this resolution, would the Senica plant shut down? >> No, it would not. Um, Senica would uh market to somebody else. >> Okay. So, we either have some ability to stipulate some of what happens there through a contract with e webb or they can go out to the market and get kind of

40:50 lowest bid what they wanted. Yeah, they would they would get the highest bid the uh >> the I I think the um >> the flip side really the reason for our interest is not only could they market that they could market it for a longer term and if we did were in a position where we could need a local resource um because of transmission constraints u that resource would not be available to us potentially. And so um having it um available to us as these market conditions and operating conditions change for a short amount of time for a three to whatever the the three-year kind of window um allows us to um u see

41:35 how those markets develop gives it just gives us flexibility there. >> Can you put the um 9.8 megawws into perspective and the amount of storage they have on site into perspective? It's it's my understanding that that's the name plate. It doesn't quite run at name plate. Brian, do you know what it its average output is? >> Uh the average is in the mid- teens. I think 15 or 16. >> So, and they have about two weeks worth of us as a community. So, if you know if we go down and we have a major emergency in the region, what does this provide us and for how long? >> Our our average Well, so there's a couple of conditions that would probably occur. Our average load for on a yearly basis is about 275 megawatts. So significantly higher than this. However,

42:21 if we had an issue where the the grid went down, we had to island, we had to rely on local resources, we would go into a pretty heavy curtailment mode. Um we would have to look at at certain critical functions, hospitals for example, uh certain grocery stores. We would have to limit that load. Um I suspect in in remembering some of my work back when I was actually in engineering um about 50 megawws to really kind of maintain emergency services and certain degree of of level of support. Um this doesn't get us quite there. Um but they do have about two weeks worth of fuel on hand typically. Um so there's some resiliency value. Um I think if we really wanted to uh expand

43:09 that um working with them on uh greater black start capability u which would take some investment in the future um would be a piece of of u the relationship that would be at a time past the three-year window. >> Okay. one last and then I'll let others and then I have other questions but I'll let other um so on that topic do we have other uh sources in the region that can provide that same level I mean we have Carmen up river would we anticipate that there that there could be an emergency that would block that off >> so um Carmen well well in some ways we think of it as local because it's ours um it's 70 miles away um we do have co-owners partership

43:54 with um international paper um which is about a 40 40 megawatt >> the name plate is about that it runs around 20 average >> about 20 in East Springfield um there's the University of Oregon which has about 10 megawatts of generation so those are right now the ones that could actually potentially start up and synchronize and run >> and those are natural gas based Carmen's hydro, the other right one's uh coen and then um and then natural gas at University of Oregon. >> Great. Okay.

44:39 >> Other questions? >> I'll pass. Go ahead. >> Go ahead. >> Yeah. Thank you, chair. Um and uh Sonia, I'm crossing off all my questions, so thanks for jumping in first. Um, yeah, I wanted to I I wanted to just acknowledge too, I think that this um from public testimony, this came very quickly and I think a lot of folks were surprised by that, myself included. This is I I went through past board packets and I went through past communication, I didn't see anything about this coming up. Um, so this this came pretty quickly. Um, and also recognizing I'm new to the commission, so that might be part of the reason why it feels like it's coming quickly. Um can I directly ask your understanding of how their process works? They use um

45:25 the mill waste, the tree slash that is the that is the senica process, right? They use this this process that already would be existing in their normal operations. >> These Yes, that's correct. They primarily use what I would call agriculture industrial waste. >> Thank you. they they also um need steam for their own production and so um the um the combustion supplies their own steam as well as electricity. So that's where the the code generation comes in >> and from your expertise the response from LRAPA about the favorable compliance record is comfortable for you to operate in correct is that's a a

46:12 >> so there's there I mean first of all you have to look at the role of LRAPA which is um related to uh the environment air quality in particular. Um the other thing just uh Commissioner Morris and this just a personal observation. I' I've been in most of my career spent in industrial facilities. I've never seen an industrial facilities a facil facility go to the extent that uh this one has relative to controlling the environment the environmental protections and things that they have gone through. And so not surprisingly when we did and we wanted to make sure that we directly reached out to Elraa their comment around a favorable environ um compliance record was was not a surprise. Um I think in fact all the

46:58 commissioners I don't know if you have um but the rest of the commissioners have taken a tour of of the site which includes a lot of of enclosures and covering and and um materials handling as well as not just the combustion and then um um additional um environmental protection pollution controls uh electrostatic precipitators for for example um on on the output But um when I do hear um people quoting dirtier than or you know this this kind of comparison, I think you have to be really careful what what you're using as your standard and what you're comparing to. Um if you're looking at the total life cycle versus just at the output of

47:44 a smoke stack with no controls. I mean there's a lot of different details that go into that. Um the National Renewable Environmental Labs did do a life cycle study on different kinds of um electricity generation. This was a study in 2021 and that study showed bi biomass and cogen in particular was significantly cleaner than the references this evening. Again, I want to be careful of that too. you have to be um there there's a lot of especially in the carbon accounting world there's a lot of factual extrapolation if this is true and that's true then this other thing must also be true and so um we we have tended to lean into those who are are chartered with its control which in

48:29 this case is Elraa and the state of Oregon has deemed it renewable which uh allows us to market the renewable energy credits that come along with it. Yeah, thank you. Um, it was a very uh let me knock off some more questions if um I really appreciate that and I uh I I recognize too I'm hearing from a lot of advocates that are very wholly against biomass and cite a lot of things that are happening in different states and specifically a lot of the things that I've seen um highlight wood pellets. And so that's why my first question was your understanding is it's the agricultural waste. And so um and the wood pellet conversation is significantly much more environmentally impactful um and not what's happening here. >> Much of it managing its own process.

49:15 >> Yeah, it's all a mess. Um, so yeah, I um I I uh I think the only other question that I had was um will there be a pri prioritization of access to electricity should we have the need of it? >> Yeah, I think that's something that we would put in the contract. Um I think we have access to it. Um what we do with it is our decision. that's we're we're the marketer or the user in this case. Um we have had discussions around um what fair value looks like and so that's um that's been part of the dis discussion so far. >> Great. Um those are my questions.

50:07 >> Sonia and Tim, thank you for doing such a great job asking these questions. You kind of covered everything that I was going to ask, but Sonia, I think you have some more. Is that true? >> I do. If you unless Yeah, you you two both get time before I >> Yeah, >> just deferring to others, but if it's my turn, I'll go. >> Yeah. >> Thank you. Um, thank you for the presentation and everything else. And like I say, I' I've had um long long history with this and my experience with this company, the past company and the current companies. Their cards are up. They have nothing to hide. They're good community members and everything else. I'm grateful that we have the opportunity to renegotiate a contract that's that's much much more favorable to us so we can continue to have input on how it's run because if we kick this down the down the curb or we say no,

50:52 we're not going to do this. They're still going to they're still going to operate the same way they are with the same levels of things, we're not going to have any say or any input or any opportunity. And uh I I think to delay this or to do anything else would be a lost opportunity. And so I'm I'm fully in favor of this resolution and uh and understand where we're going with it because like I say, this is a unique operation. When they built it, it was so state-of-the-art. They spent millions and millions of dollars more than they needed to based upon the input we got from the state of Oregon. The state of Oregon encouraged us and and Elraa is a really good uh oversight and if they they say that their compliance and and doing good, I'm I'm good with that. And I don't think any other contract that we we do and we don't micromanage it. We

51:37 don't do harvest wind and we didn't do IP and all these others and and this is a three-year extension. It's not a 20-year contract like we did last year. So, I'm unless I hear something from others that this I'm all in favor of uh extending this contract for a period of three years. I think it's a good business move and it's good for the community and thank you for bringing it. >> Sony, did you have some more questions? >> I do. Was there anything that you wanted to comment on? >> No, I would just say that I feel the same way that John feels. Um I feel like this is a this is a um something that's available to us. I think that um it's not like if we didn't have this contract that that this would go away. So I think it's a good opportunity for us to have some say

52:22 in how this um how the energy is managed. Um, and also that it's just a three-year contract. It's just short-term. I think it provides us some flexibility in a time where there's just some uncertainties. I assume that in three years we'll be um negotiating another contract and maybe we'll know a little bit more about just some what some of our options are. So, I'm in support of this. Yeah. >> I think also, President Schberg and and Commissioner, we we talk about negotiating and where we will be in three years. I think the the markets will be someplace different in three years. Um which which also um the um Sierra Pacific um recognizes the fact

53:07 that a three-year deal is appropriate. It's a 20-year deal would be high risk for all parties involved. And so I think that the timing does make sense um u given where markets are at um given things that we're seeing. um the the gentleman who testified on on wet and a lot of things happening in the region. I certainly appreciate understand the testimony around this is not a mutually exclusive thing. If we do this, we can't do all these other things. I think we have to look at this as a portfolio and recognize things like conservation are important, renewable sources are important, local um as well as understanding impacts on transmission. um the transmission queue is the highest

53:54 it's ever been in its history. And so we have to recognize the importance of that and and really build in the flexibility to have choices. Um and um believe that this does >> I know we're over time, but Sonia has more questions. Okay. And Tim does too. So is it okay if we do another round or Okay, great. Go ahead. >> I'll I'll try to be quick. Um so if if we vote on this resolution just process quickly um you go and do the negotiating and then you come back or this is it you go and make the contract and it gets signed. >> So the the guidance that the resolution provides basically is an extension of of the contract that exists with some new

54:40 terms. There's guidance around what those term the the qualifications that those terms have and then the authority would be to negotiate and execute if it meets those terms. If it doesn't meet those terms, we will not execute it, but we would not have to bring it back. >> Okay. So, the the the terms that are changing are the the pricing >> basically >> and everything else stays the same. >> Yeah. >> And is there an opportunity to talk about anything else or that that would not be an extension of the contract at that point? There's been minor administrative changes to it, but nothing that that would be substantive. >> Okay. Real quick, how much of our power comes from Senica overall? >> Overall, Brian, this I'll I'll make make a note that none of it is going is dedicated to load at this point. So zero

55:27 of the 275. But if you look at our to total portfolio which is around three oh 300 350 something like that. So to be in the 5% kind of range >> 5%. >> Um question. Um okay so just a quick other couple of quick comments. Um, you know, I I appreciate all the work that, you know, that folks have put into this, the the thought process around the three years. Um, it did feel kind of quick and sudden on the timing and I do um, you know, given that that it would just kind of be an extension and then it wouldn't come

56:12 back to us, I'm a little bit nervous about that. But it is only three years and um I do think it's a an appropriate resource for the region. Um I wish that others could see the plant like I have. I I it is impressive. It it is incredibly impressive the amount of work and the cleaning um technology that's put in there. Um, I'm incredibly asthmatic and walking through there, I can barely smell anything. Like it is the the concerns that are raised that I originally ran for office and thought, "Oh, this is going to be a thing." When I went in and toured it, it's like, "Oh, wow." and the data behind, you know,

56:59 looking at the air emissions from it, it it's not the typical biomass plant that I think some of these other reports are um are looking at. And I think that it's it's very clear that we need to look further at that. Um, also if if we are putting if they're putting this material and it's a byproduct of the logging process and it just goes in a pile or gets thrown out, then it's going to be in anorobic digestion. And that's part of the reason why if you put something like that biomass type product in anorobic digestion, then it creates methane and we don't have a another plant to capture that right now. So then we're putting something out into the air

57:44 that's going to be far greater in terms of its emissions, which is part of the reason why this a plant like this gets renewable energy credits in the first place. Um because of what happens to that material and they are not putting whole logs into there. The market on that is not worth it. I mean they have technology that goes out into the market and looks at how to precisely cut the log to have the least amount of waste. It's insane. It's it's incredible the amount of you know effort that has gone into not wasting as much material as possible. So whatever is remaining is something that they cannot use for any other best purpose. Um, so I had to explain all those reasons

58:29 because my values um of environmentalism, of protecting our community, for looking out for the future of my kiddo and others in the area. We have to look at carbon resources and this is a very small portion of our piece but I think that this has a good resiliency purpose and we do have to still continue to look at energy efficiency and other renewable sources. It's not a oneanddone. This isn't an endall but I do think for this particular contract this is the right thing for our community. So thank you for my long- winded response.

59:18 I uh I was very comforted by the question um what does power generation look like? How much load are we using it on a daily basis? Um the way that this is pitched to me, the way that that I'm seeing this is it is really for emergency purposes or when things get really high um during you know it's outside of normal operating business. Um and so that's the intent here that um we would be utilizing this biomass generator with products that they would already be they would continue this operation regardless of what we're contracting them with or not and that potentially our contract with them could narrow their focus more than another agency could. Um, I think that

1:00:04 you hit a a nail on the head of they would go out for the next highest bidder, um, who probably won't have our same commitment to resiliency, to environmentalism, to to support. And so, um, that's what's providing me comfort here. I think also providing me a lot of comfort is it's a three-year contract and it's just an extension of what's happening. And one of the biggest community concerns that I heard was the affordability aspect, which sounds like it's being addressed now, the the cost of it and and we're approaching that now. Um I think it is really hard to be in a position where we are advocating for as as little carbon in our community as possible. And I think it's important to acknowledge that that biomass does or can produce more carbon than your

1:00:51 average bear. but also that uh it is not apples and oranges. But I think it's just important to to operate in a a factual space. But um well and truly I I I see this as an emergency effort or for emergency periods, excuse me. Um that will be used other in other ways anyway with a so um there's a begrudging support uh that I will be voting in favor of this. Um, and I think also in the background, it very clearly highlights that it's outlined that it takes years um, for a lot of this environmental work that is well and truly carbon neutral or carbon negative. Um, and while I know it's not a let's start now because we've been doing that

1:01:37 work for years and years and years, I think it's just a good pinpoint to acknowledge it is uh potentially time to refocus that energy and effort and continue looking for other alternatives. Thank you. >> I'd like to move to approve resolution 2516 as presented. All those in favor say I. >> I. Right. Like it was approved. >> Thank you. >> You. >> Thank you. >> All right. Now, we're moving on to our general business items. Agenda number nine is the current year legislative and

1:02:23 regional policy update and upcoming year legislative session preview. Good evening everyone. Uh for the record, I'm Jason Huser, the EW Webb public policy and government affairs director. It's good to see you all again uh in person for once as well. Um this is our periodic regional policy update. I'll be covering a variety of issues at different uh levels of government this evening. Um as you can see, these are the places I live. Ew Webb, the state capital, and once in a while Washington DC, a snapshot of my life. Uh we're going to start off with some federal issues um that are are regional in nature though. Uh starting off with the reversal of the Columbia River

1:03:09 settlement agreement. Um, you all probably recall from past correspondents or a media coverage that uh a year ago a landmark agreement was uh agreed to in the region. A commitment from the federal government to salmon restoration efforts. A sprawling very comprehensive um list of measures that would have run to the tune of $1 billion. um variety of opinions in the electric sector, variety of opinions in the public power sector uh about the merits of that agreement. One thing I think everyone could agree on was one positive was it put a stay on litigation for a decade and as you all know certainty something that we crave in our industry

1:03:56 uh certainty about the operations of the federal hydro system certainly that was one of the benefits of that agreement that everyone agreed was a good thing. So, I'm here to share the news that with the reversal of that uh landmark agreement, um we're now back in limbo of sorts and that certainty has dissipated and most likely there will be a return to the courtroom uh as far as settling some of the future of federal hydro operations and the future of the Columbia River uh basin. So, um it also means there's not a lot for us to do. Um, we certainly in recent years have been a little more involved talking to decision makers about this topic, but

1:04:41 with a return to the courtroom, there's really not much for us to do. This is ultimately going to be settled through uh the judicial system. Um, it's very important though, and we'll continue to keep you apprised of developments in this area. Moving along to another topic on the Columbia River. Um, Columbia River treaty negotiations have been paused. Um that is not something that we should be alarmed about um because uh it's pretty typical when there's a change in presidential administrations that all sorts of international agreements that are in pending negotiations are paused for review. So there's nothing unusual about that. Um however, we're quite eager to see those negotiations resume because there was a big breakthrough a year ago. Um, as many of you will know,

1:05:27 um, I see a few of you who have been out to Washington DC with me. Uh, we'll you'll remember well, there was over a decade of inaction on modernizing the Columbia River Treaty with Canada, an agreement that has afforded the United States flood uh, flood protection, flood control rather, and downstream power benefits for 60 years. but however was in desperate need of modernization due to an imbalance in the benefits that flow to Canada uh to the tune of up to $300 million annually uh depending on wholesale power prices that's the high range uh when prices are lower that figure is lower uh but uh as high as $300 million annually in overpayment uh

1:06:12 in the benefits to Canada certainly that was something that um folks were interested in a modernized treaty uh since electric rate payers in the Pacific Northwest including e webb customers uh pay for that overpayment I think it probably our share of that overpayment is um for the 300 million figure the e webb share would be $3 million so we're very eager to see uh the treaty modernized and have a more balanced treaty a year ago there was an agreement in principle that did just that uh wasn't uh the full uh reduction in the entitlement we would have liked to have seen but a pretty fair deal compared to the status quo. So, we're eager to see negotiations begin again and to see um a modernized treaty that's

1:06:58 ratified by Congress. Uh actually, this this Friday, I'll be on a meeting with several other regional utilities. We're about to step up our advocacy to the Northwest Cong Congressional delegation to ask them uh to urge the current administration to resume uh negotiations and get this one over the finish line. Uh moving along moving along a little bit closer to home. Uh there is some post session activity in Salem. The Oregon energy strategy is still underway. We're coming up close to the end of the two-year period for that work to be completed. Many e-web staffers, including myself, Aaron Orlowski, and several others. Uh Brian Booth is in the room. I I know he's been on a technical

1:07:44 work group or two. Uh many folks from Eb have been involved in an advisory capacity. Uh that work is winding up. There is a draft energy strategy. It is out for a public comment period that ends on September 22nd. Uh, tomorrow morning we actually have an internal meeting of EW Webb subject matter experts to talk a little bit about what we've seen in that draft. I would characterize the draft as EV evolution, not revolution. I don't think there's anything that's too outlandish in there. Um, a few topics of interest though include a recommendation for an Oregon transmission authority and a recommendation that new large electric loads register and report to the state of Oregon on how they're being served. I I don't think that we would say we're

1:08:29 for or against those recommendations, but I think there's constructive input we may want to provide to the Oregon Department of Energy to ensure that these policies are more effective and actually address the goals they're designed uh uh to fulfill and avoid unintended consequences. So stay tuned on that. I'll be sure that any comments we file are CC to the board. Uh there is one bill from the session that I think we're really going to want to watch the rulemaking on. House Bill 2688 which was passed uh I think in the last 48 hours of the session uh did make some changes that would expand Oregon prevailing wage law to um cover certain off-site prefabrication.

1:09:14 Um it's was purportedly designed to address changes in technology in prefabrication. Um, however, I think the lack of definitions in the bill as far as what uh denotes custom or bespoke fabrication is something we're going to be concerned about. And I'm going to be asking EW Webb purchasing staff to work very close with me closely with me to track that rule making. We certainly have special projects whether it be Carmen Smith hydroelectric projects, a water treatment plant that I think we would definitely want to make sure we understand the implications for and would want to make sure the folks in charge of that rulemaking understand the potential to increase costs and complexity for those projects without a lot of public benefit. And if needed, we

1:10:00 would want to relay that to our legislators should they want to revisit the legislation they passed in the final days. It it's always hard to predict this far out what you might be working on in a future legislative session, but I'll hazard a guess this evening uh by highlighting at least two topics that I feel fairly confident EW will be working on between now and during the legislative session in 2026. The first one should be somewhat familiar to you all. It's a reintroduction of solar consumer protection legislation that EWB collaborated on this past session with the Oregon Solar Industry Association, Oregon Consumer Justice, and a variety

1:10:46 of state agencies and um uh public interest groups. It was a really good bill. Um, unfortunately we got caught up in the log jam in bill drafting and legislative council was unable to return the legislation to us in ter in time to meet certain legislative deadlines and the bill died procedurally. All the stakeholders that worked on that, we all agreed that was a shame and we all said we would come back and work on this in 2026 and and again I want to emphasize that the solar industry in Oregon, their statewide association worked with us. I give them a lot of credit. No industry wants to be agree to be regulated more than you are. But I think they saw there was a real opportunity for a win-win here. A win for consumer protection, but

1:11:33 also a win for their industry and trying to gain back market share for the many, many good actors in the solar industry for contractors, especially longstanding local companies. We think that most of the bad actors that we know of are probably out ofstate fly by night companies that are financed by very aggressive investors. And so we'd love to see the good actors regain market share in solar installations. So look for that to return. Uh moving along, the last topic uh is carbon pricing, capp trade. Uh again, I did not think I would be talking about this, but it persists. It persists. It came up in the last month of session very unexpectedly and it's going to

1:12:18 persist. I know people right now that are talking to uh legislators about this, talking to other stakeholders. People are redering their positions and advocacy. As you know, we played a very very prominent role in the formulation of legislation in 2019 and 2020. Ew Webb did a lot to educate ourselves and I think contribute to improving legislation uh in those two sessions and and getting good outcomes in the design of those bills. We would be doing I think the public interest a favor as well as representing EWB customers well to reprise that role again uh in this coming 2026 session. However much of a long shot it is uh best to prepare as if it could happen. So um and then bear

1:13:04 with me what I'm about to get into. It's something that in 2019 and 2020, I think I presented on this topic 50 different times and I got pretty good at it. Uh it's been see six year five or six years. So bear with me as I shake off the rust. Um but I'm going to talk a little about a little bit about some of the design elements that e webb will probably want to advocate for in cap trade legislation. First being the point of regulation. The point of regulation for capp trade can be placed at various levels of the electric sector. Uh starting with in the green uh retail load um that is something that can lead to changes in behavior from consumers. They might try to use less energy, fuel switch, etc.

1:13:52 There's only so much though that um customers can do, but they do have some options. And then as you get into the orange, you can see uh that kind of m middle level. Um that's where the a carbon price can affect uh purchasing decisions. It can also affect long-term resources decisions that are made in the context of an IRP. And then moving up to the top, the blue, that's that's all the way upstream. That's at the generator level. That's the folks that are selling or otherwise have some control of what electric resource gets dispatched to to serve the grid. The most effective point of regulation in our view is upstream because the upstream point of regulation as high as you can go, it covers all three of these

1:14:38 levels. If we're trying to have a carbon price signal that truly transforms the electric sector and transforms it sooner than later, we want to go upstream as far as possible. The the benefit of going as far upstream as possible is that you transmit a very clear pure price signal that embeds itself in the economics of energy transactions including wholesale markets. Um you can see here uh on the right there's a bunch of doors. The person looking at it is a buyer of electricity. There are wholesale markets, exchanges where frequently uh a utility may be just trying to keep the lights on. The exchanges in which some

1:15:25 bilateral market transactions occur. You don't really get to see the resource you're buying or the carbon content. you're only going to see megawatt hours available and for what time period. And so, uh, the the seller is the person that really knows what resources they're putting up up for sale or potentially could dispatch. So, the, uh, the peer price signal is one that's going to affect the seller's decisions, the person who really dispatches the electric unit. And a car, a a carbon resource, they're going to have to price in the cost of a carbon allowance. That's a permit to emit one ton of carbon. So, I use $10 here. It's probably a lot higher now. I think I I did this slide back when prices were were low. I think allowances in the

1:16:11 Washington market are trading around $50 to $60 a ton. So, we can imagine a much higher figure there. um by sending that pure price signal and embedding the price of carbon in the economics of wholesale market transactions. You can see here it's uh dirty resources don't dispatch. They don't get turned on. They're not economical unless prices are very very high. And if prices are very very high, it's very likely those resources actually might be needed. But it's very important here. Um you can see the difference here on the left. Um the source-based that's a another way of saying upstream the sourcebased method actually embeds the carbon the price of

1:16:56 the allowance has to be factored into the overhead into the economics on the right. The loadbased method it doesn't include the price of the carbon and so it's just a way way less efficient way uh to regulate carbon and doesn't have the same impact and not as soon as going upstream in a source-based method. Uh, another important factor is linkage. Oregon is not the biggest state in the west coast compared to our neighbors. Uh, the idea of Oregon administering its own carbon capp trade program um that that's very daunting in terms of the administrative burden as well as how the market might function with liquidity for um allowances. We really would be well served if we linked to the Washington

1:17:41 and California programs. It would greatly ease the administrative burden and probably have a much healthier market uh if all three western programs were linked in the future. Going back to point of regulation, Washington and California have a very upstream point of regulation. So this is another reason that point of regulation matters so much. It may be requisite in order to have regional linkage. So, uh, I'll try to close it up here and, uh, take questions, but before I do, I just want to re reiterate some of the key points we'll be making. EW will be very supportive of an upstream point of regulation that will be known as first jurisdictional deliver for imported power. We're supportive of regional linkage. We're supportive of revenue recycling.

1:18:28 That's the idea that the revenue raised through uh the auction of allowances is recycled back to the people from whom it's collected uh in helping them pay for carbon reduction measures. Revenue recycling uh has been studied. It's very important to make the program uh as um affordable for consumers as possible. If you don't give the money back to people to help them pay for ways to reduce their carbon fentin, it increases the compliance cost to society. Uh also there's the matter of allocation of free allowances to utilities. Uh we just want something that's fair. I don't think we expect that we'll uh get allowances on the same basis as Portland General Electric or Pacific Power, which

1:19:14 have a lot more carbon in their portfolio. But certainly we think that e webb customers should be entitled to allowances to offset some of our increased costs uh due to carbon pricing. And finally um we would expect that the program account for hydro variability. Um as a hydropower based utility along with the many other customers of Bonavville we want to have ways to smooth out compliance when there's a bad water year or other variation in the hydrograph. And lastly, um this this last bullet uh is a very technical issue, but as you may know, uh more and more wholesale market transactions are occurring in centralized organized markets in the west. We're seeing a trend away from

1:19:59 bilateral transactions. Uh we haven't I I don't think regulators have found the best way to account for carbon in those organized market transactions. So the legislature would do well to do this. uh probably in some kind of authorized rulemaking uh to the Department of Environmental Quality so that in the future as these markets continue to evolve, we won't have have to go back and pass a new bill uh to regulate that carbon appropriately. It could simply be addressed through updated rulemaking. And I've been talking for a while. I want to wrap it up and uh leave time for questions. So I'll pause there.

1:20:47 Not a question, just a comment. You are always welcome to talk for a while. I always learn something every time you're up here. So, just thank you for your hard work. Thank you for your good work. Um, I have a bunch of questions, but nothing that's fully formed yet. So, thank you. >> Well, thank you. Any anything I say that's is informative, just remember it's a team effort. I have a whole team here at Eb that helps me and we all educate each other together. So, thank you. JC um on the prevailing wage thing. So that extends to foreign companies too for especially I mean so if we go to the second source water and we have to have things fabricated and so now we how are we going to how are they going to enforce prevailing wage in China? >> Uh the answer to that is no one knows. I mean because it seems to me that it's

1:21:35 >> it's a noble concept but prevailing wage adds 30% to any construction cost. >> Yeah. I there are a lot of unanswered questions. This is why this is one of the most important rulemakings I think e webb's ever uh seen as far as bully. We we really don't get real involved with rulemakings at bully but this is a very important one. And the debate on the floor of the both the House and Senate was fascinating because there was frankly um a a large number of legislators that voted for this bill and acknowledged on the record. They weren't sure they had all the answers to some of the questions they had and they very much are hoping that there will be an excellent rule making that will answer the type of questions you just identified. So, um it is it is very

1:22:22 interesting that they've uh delegated that much authority to the state agency and I would not be shocked if there is a need to return to the legislature for some cleanup of this bill if the rule making can't adequately balance all the uh very important trade-offs and and competing interests. So >> I just comment that you know you commented about how certainty in carbon pricing how important it is and things such as that uncertainty in any pricing and so when we we get a variation where we could have another bump you know we've gone from 70 to 160 and if we got a 30% variance um I mean we can't live with that some you know we have to know if outsourcing specially fabricated

1:23:07 things does that include like generators and turbines thing when we have a new turbine mill built for Carmen. We outsource that and and and they build it in China and uh and ship it over here wherever they build it. So now we're going to we don't know if that's going to cost us 10 million or 16 million. >> Yeah, that's that's where the words custom bespoke were not defined in the bill and there's a wide range of interpretation um on that. Does that mean if there's a product you get different choices in color even what have you? Does that make it custom bespoke? So, uh, there's a lot being left to the rule making here. Uh, the purchasing staff at EWB are going to get to know me a lot better. Uh, Quinton already knows I'm going to need a lot of support on this. Uh, and I'll be taking good notes, uh, during the rulem should

1:23:53 we need to go back to the legislature and ask for some adjustments. >> Thank you. >> Thank you for your hard work and for your presentation and I'm sure we'll hear from you in another few months. >> Sounds good. Thanks so much. Thank you. All right, we are now at our break. Um, we're running a little ahead, but that's all right. So, we have a 10-minute break, so we will come back at 7:05.

1:35:06 You can accept it. >> All right, I'm going to call us uh back into session and we are on agenda item number 11, general manager recruitment process. Good evening everyone. Um, commissioners, uh, my name is Dra Williams and I serve as the chief people officer for Eb. As you may recall, on August 5th, general manager Lawson announced his intention to retire within the 2026 calendar year. So I am here tonight to give an overview of the executive recruitment process and am ultimately seeking direction from the board on uh some identified recruitment process and standards questions.

1:35:55 So as a quick overview of our agenda for the presentation this evening we have three main topic areas. We're going to do a brief walk through of the process objective and constraints that uh are found within a public entity. A discussion requiring uh regarding the hiring process itself along with a request for direction from the board and a discussion requiring regarding hiring standards along with accompanying direction from the board. So when starting a new project it is important for all the parties to clearly identify the desired outcomes so that we can all agree on how success is measured. In the case of the general manager recruitment, we are looking to hire a new GM who is best qualified to

1:36:42 lead EW web to success in immediate, mid, and long-term scenarios. Um, the process itself should comply with governance requirements, should be able to withstand uh scrutiny from any internal or external stakeholders. It should be both timely and efficient, and limit disruption to utility operations. On the matter of governance constraints, uh I would note that there are no current board policies that dictate the process for the general manager recruitment or selection. Um there are applicable statutes. However, Oregon statute 192660 specifies that some tasks

1:37:28 uh must be taken place publicly either during a general session or through some other form of public communication. Uh these items are the posting of the job vacancy, adoption of hiring procedures, confirmation of the hiring standards. Think of those as like the minimum qualifications a candidate will have to be possessed to be considered for the role. Additionally, the public has to be given an opportunity to comment on all of these items before any discussion happens in an executive session. It is appropriate for certain topics to be held in executive session after the public has had an opportunity to offer input. For example, after the board has

1:38:13 publicly discussed and given direction regarding process and standards and the public has had an opportunity for input, executive session would be an appropriate avenue for comparison of candidates against the standards or against one another. This appropriately protects the confidentiality of pro p prospective applicants who are not yet public servants. Similarly, the executive session can be used to give staff direction to negotiate a contingent offer of employment to an identified candidate to see if um potential and mutually agreeable financial and contractual terms can be established. However, it's important to note that any decision to make an actual offer of employment must

1:38:58 occur within the general session. Turning now to the hiring process itself. Staff is seeking direction from the board on two points within the recruiting process. One option for the board to consider is whether it wishes to make use of a subcommittee of all or a portion of the recruitment work. Subcommittees can be an effective tool within the board structure as they can expedite completion of tasks particularly within boards that face time or workload constraints. The scope of a subcommittee can be as broad or as narrow as the board deems it. For example, a subcommittee could be tasked with reviewing and prioritizing

1:39:44 an initial list of candidates to create a short list for full board review. Um, or a subcommittee could be tasked with working directly with council to craft a potential offer of employment for an identified candidate. There are drawbacks to the committee approach, however, that the board should consider. uh committee work can limit the flow of information amongst board members siloing detailed information in the heads of just a few members. Uh as e-web is a public entity quorum rules will fully apply to the subcommittee. This means that a quorum when a quorum of two or more members occurs um full notice administration requirements apply. This could limit the efficiency a subcommittee could bring to the overall process.

1:40:34 So staff is directing requesting direction from the board regarding the use of subcommittees during the executive recruitment process in particular. Does the board have a desire to create a subcommittee within the general manager replacement process? And if so, what body of work will be assigned to the subcommittee? >> Do you want us to discuss this question now? Okay, John, I think you've got some thoughts. >> I do. Um, I'm a believer that if you've got a process and it works really well. I don't think there's a real reason to somebody can tell me to change it. I think we made an excellent decision last time and I've been this I think your third I mean outlive three or four of you. So anyhow, but seriously um I I

1:41:22 think the process we did it was very demanding on the board, very time consuming, but I think it was very deliberative and it was it turned out an very very good results and it was very fair and and so I would like to do that this replicate as much as we can in the last process or the last two most importantly the last one and and continue under that particular guidance. I mean subject to other people in but you know if it's working and if it worked why would we change it >> before I go on to someone else what was the process what did you do >> we all participate >> subcommittes a >> lot of dinners no subcommittees and uh and we hired white coffin associates I think from Denver and uh they do and they all they

1:42:08 do is head hunting for GMs for utilities all over the United States they I was very impressed for them. We've used them twice and uh and we used them and they made it not as time consuming and not as challenging on us. But it's it's going to be a commitment of time from this board if if that's the decision of the whole is to not have subcommittees because I too would be subcommittees. So if two of us were in the subcommittee and we had different perspectives, you know, it just to me it's we represent entire communities, not just four wards. And so I would I would like to see if everybody wants to put the time in, but we've put the time in. This is the biggest decision you'll ever make. A lot bigger than Second Source, a lot bigger than Carmen, but a lot bigger than Lever

1:42:55 because whatever happens there directs the whole thing, >> Sonia, and then Tim. Well, I haven't been through a process before, but my gut reaction was that we shouldn't have subcommittees either because then you just spend most of the time telling the other people why they should make the decision that you made. And it I I think we all represent different viewpoints and interests and it's valuable for us to be there and and share those perspectives. >> Yeah, I agree. I I think a subcommittee makes sense in a private organization or to pull uh that work away from other groups of people so that they can focus on that. That's not what we would it

1:43:42 would create so much process and so much effort and delay this process more. And I think if memory or if my understanding is I think we all in some form or fashion professionally have experience in at least reviewing or understanding applicants in some formal fashion. So I I think that we would be losing some of that effort as well. It just doesn't make sense to go forward with a subcommittee. >> I think it would be difficult to choose who would be on the subcommittee because I think everybody would want to be on the subcommittee. So like everybody else, I don't think we should have a subcommittee. >> Okay. I um Dra I was just curious um if you got any perspectives from John Barovski before he left on this

1:44:28 particular topic and as you go through this if you if you did what if it's appropriate there sounds like there's a consensus on this topic in particular but if if not and you feel like um it's relevant to share his perspective if you got it. >> Thank you for that. um on this particular topic. Uh Commissioner Broski did not provide input. All right, thank you for that uh guidance. So, moving on to sourcing parameters within the hiring process. Um also seeking direction from the board regarding how candidates are to be sourced within the hiring process. At a

1:45:13 high level, there's three basic approaches a recruiter can take towards sourcing candidates. And we're going to briefly touch on each of these opposite uh options on subsequent slides just to give an overview. With direct solicitation, the recruiter focuses solely on a narrow field of known candidates. This would be likely a small handful of individuals already known to the board and whom the board is confident can su successfully meet the minimum and preferred qualifications of the role because it is a very targeted effort. Successful recruitments can be achieved very quickly and for a lower cost than more protracted engagements. However, uh the narrow scope can also give the appearance of circumventing the

1:45:58 public process even when all public process requirements are met. The board will also not have full exposure to how the skills and abilities from known candidates measure up to others in the larger uh hiring pool. Next uh another sourcing approach is in to source and solicit via internal candidates only. Internal solicitation offers the same potential efficiencies around cost and timing as direct solicitation with the added benefit of minimizing potential disruption to operations that can sometimes occur with leadership changes. Additionally, as candidates are all internal, the board benefits from having had the opportunity to see the actual candidate work

1:46:43 performance through board presentations and operational results. Unfortunately, internal solicitation shares some of the same potential drawbacks as direct solicitation. Unless carefully managed, limiting the candidate pool to only internal candidates can also give the impression that the public process requirements have not been met. Um it may uh limit the board's understanding of how those internal candidates compare to a larger hiring pool and there is some risk that interested internal candidates may not fully meet the minimum requirements of the hiring standards. Final option for sourcing candidates is open solicitation. This is the broadest. With open solicitation, the recruiter

1:47:28 conducts a broad search for qualitative candidates across appropriate markets. It can include internal or board directed candidates and generally includes the greatest number, quantity, and diversity of qualified candidates, thus improving the board's chances in finding a successor general manager that meets or exceeds their measures of success. A diverse candidate pool also brings the possibility of fresh perspective on EWHIP's strategy and operations, ensuring that the long-term path we are on remains relevant and offers the best return for rate payers. Every approach does come with limitations. The board should note that open solicitation can and likely will increase the cost and time to hire within the process and fresh perspectives can greater chance of

1:48:14 operational disruption at least on a short-term basis. Candidates from wider pool are also more likely to have experience with water utility or an electric utility, but not likely both. So staff's recommendation on this matter would be to engage an executive search firm to assist with an open solicitation for qualified candidates for the general manager position. Search firms should have successful track record for placements both nationwide and within the Pacific Northwest. Uh they should have a deep understanding of the utility industry and it regulatory requirements. They should have a broad and deep client list of prospective candidates and they

1:48:59 should have expertise managing the executive recruitment process for public entities. Now given all that um staff is requesting some discussion and direction from the board regarding candidate sourcing and use of an executive search firm during the recruitment process. You'll see our directive questions up there, but in particular which solicitation approach should be used to secure a new GM for the utility of the three that I that I mentioned. Um, and should an executive search firm be engaged to facilitate and expedite the search process? >> Tim, >> uh, I'm going to ask a question that I

1:49:45 think is very obvious and I think I already know the answer to, but I'm going to ask anyway. Uh, if this board decides to go with an open process, does that deter or prevent internal candidates from applying for them? >> Uh, it does not deter or prevent in any way. they are open to uh and welcome to apply just like any other candidate. >> Thank you. Yeah, I support an open solicitation. I think that makes the most sense to me. Um I think that it gives the community at large an ability to see who is applying for this role. Um I think it's the most transparent and also provides the big the best path for the best candidate to fulfill the role. Um, I recognize the cons are highest cost and long list time to fulfill, but

1:50:30 I think it's worth the effort. I support um an open solicitation. Thank you. >> You heard once, but open solicitation and a national recruiter because I'm pretty sure he's probably been headed a bunch of times since he's been here. They contact him and say, "Are you interested in applying?" And he says, "No." I'm glad I don't know if he's put you on the spot so far. But uh anyhow, I'm I'm all in in support of that and I know that some of the candidates will probably will see we can't disclose who they are because they're they're already working and they don't want to jeopardize their current employment and then they won't disrupt their family. And it's a it's a pretty involved process. You got to get right down and think about a whole lot of different options. But I'm all for open

1:51:16 solicitation and national recruitment. Me too. >> Excellent. Thank you for the direction. >> Yeah, I just wanted to make make one point um just for clarification. When the the term open recruitment is used to Commissioner Brown's point, many of the candidates and using an executive recruiting firm will allow those candidates to remain confidential for some period of time. Um you mentioned an open you know people eventually learn but there is a there's a period of time where that does remain confidential and um some candidates won't take the risk to apply if um um if it's not considered

1:52:04 confidential during some portion of the process. So this next slide is forformational purposes only. Um but it does give a highle overview of sort of the flow of the executive search process as anticipated. Um I did anticipate using a uh executive search firm for this. So that is built into this already. Um I know schedules are difficult to arrange. So, I did want to offer this high level timeline so you could start to see how that would impact the next several months. Um, we're going to work to finalize this time timeline with an executive search firm. uh we've taken the uh liberty of already seeking uh uh

1:52:53 non-binding bids from a number of different firms and we'll be able to lock that down within the next couple days most likely and should have an updated um schedule for you um and finalized available for the October 7th session. >> I have a question. Oh, can I just jump in and ask a question? So it seems really optimistic the timeline. >> It is aggressive. Um so the fastest that I have ever done an executive search is 6 months. Uh we have a little more time within this this schedule but not much right. Um so it is a tight timeline from what I've seen within the proposals that

1:53:38 we've received back. Um generally the recruiting firms believe that they can also adhere to this overall schedule. Um we may see some slippage of a few weeks here or there just because of we have the holidays in the middle of this um for for various people. So we need to make sure that we can accommodate everyone's schedules. But uh I believe this is a fairly realistic schedule. And John alluded to the fact that it's going to be a lot of work for us. And I'm just curious, what will it look like for us? So I know that the candidate search and screening from October to November 18th, like I guess can you just walk me through what does that mean

1:54:23 practically for us? >> Absolutely. So that one is tied down to the uh the recruiter. uh the recruiting source in that case will um post the job. They will um start to uh reach out to their candidate pool, do a larger search, you know, LinkedIn, all the different methodologies they use. Um they will do initial pre-screening um and sort of screen through and screen out candidates that do not meet the standards that the board identifies. Um, from that that will result in a list of uh of candidates that the um that the uh board will ultimately use to make a short list on December 2nd.

1:55:12 >> That means any number of meetings. >> There could be a number of meetings. I would assume that there will be a work session associated with that. Um, usually it's a pretty robust summary of the candidates and their qualifications to allow you guys to quickly filter through um the candidates that are available to you so that you can come up with a list of somewhere between 15 and 20 would would usually be normal. Um finalist type candidates that make the short list. Um from there um you will do um I'm recommending that you would have a series of um uh online interviews, phone interview type through the December 15th through 19th. That will probably be the

1:55:58 largest volume of work right there. Um sitting down and and scheduling and having time with all those candidates. The recruiter of course will help with the logistics of that. Um after that um the uh board would select finalist top two maybe three candidates. Um that will come in person to do interviews. That would be the week of January 12th and a final candidate selection from the board by the end of that month. Um so that the recruiter can then work on behalf of the board with the guidance of the board to identify financial and legal terms in a potential employment contract. I'd just like to comment when this last process we didn't have the benefit of

1:56:43 teams or zoom and things like that. Everything was in person. So the time timing the efficiency because I I you know short list interviews I thought well if those are on person and you think you're going to get into this airport there's going to be five days it's going to be fogged in in December. But that's an aside. But uh do you want maybe later in your presentation about are we going to offer salary range at the initial at the posting and uh and things such as that because I know that ca that was a huge thing in some prior efforts at this because some of them said well I'm not going to talk to you for less than x amount and and where does that come in this discussion? >> That is a great question. Um so if you look at uh the October 7th session uh I have it generally listed as requirements

1:57:28 discussion with vendors. So that would be the recruiter um uh talking with the uh the potential vendors that we've spoken with. They all do want to have their own conversation with you both around standards and around the salary range. uh my team here at EW webb the HR team has already started the leg work associated with validating the uh salary range that we see in the market um so we'll have that as a data point for you in the in the next session um so that you can work with the recruiter to identify both the range and um not only the standards but where you have priorities within those standards so the recruiter really has a fullyfledged um understanding of your priorities and your vision of how a general manager can

1:58:13 be successful. >> And that includes things like moving expenses and thinking of dual housing because if they can't sell their house where they're coming from, I mean, there's a whole list of considerations that >> we could offer or we may be asked to offer. So, I don't know how much of that detail we're going to get into, but it you say October 7th and that's whomever we're working with. >> That's the that's the date towards. Yes. >> Thank you. So I'm assuming that will also be the time when we um talk about the process and how um I'm well personally I'm hoping that there are some uh provisions in place that uh protect the not the identity but um

1:59:03 basically there are DEI provisions where you um have screening of candidates that helps candidates of different backgrounds get into the mix. And in a utility like this, like um maybe names are, you know, in the initial screening names are wiped because if you have a name that might be more ethnic, then just general bias might not allow for that name to come through that filtering. So, there are certain um methodologies that are in place. So, I'm hoping that that's a part of that thought process. I don't know how much is already baked into our current hiring processes, but um I think it would be pretty um important that we have those kind of provisions in place given our policies around diversity, equity, and inclusion.

1:59:49 Thank you. >> Thank you. That's a a wonderful point. As Frank uh uh general manager Lawson pointed out, um typically there is a certain amount of confidentiality built into initial candidates. the initial pool. Um, in part that does protect diversity. Um, I am aware that a number of the contracts actually have controls in place that that uh also uh work to secure that, but we can also work with the contractor to ensure that that is in place. >> Thank you, Chair. Yeah, I thank you. you, Commissioner Carlson, had asked one of my two questions. So, thank you for

2:00:34 for that. Um, I think the only I have I'm I recognize the tight timetable and so I probably can I can see I can see where that is and I'm not necessarily advocating for an adjustment here, but I am curious about the board's appetite for finalist interviews to be in a public setting. And I'm I'm pointing that out particularly because it looks like a general meeting that we're going to have in October. And then if I'm a member of the public who's not part of this process, just the next time I'm going to be aware of a new step is we've already offered employment to the new GM. So I'm not going to have any idea of who are potential candidates. If I'm a member of the public, I'm going to have an opportunity to advocate for specific things. Um, I don't Yeah, I I'm I'm

2:01:21 recognizing that. I don't know what I'm struggling with that and I'm curious what other commissioners are how other commissioners feel about that. >> Doesn't that get into the privacy issue? Like some some candidates might not want it to be public until they're ready to accept a job. >> Sure. >> So, I think that that would um preclude a lot of people from even getting to that point if it was going to be public that way. Yeah, I agree. I think that there would be candidates that would not go through that process because, you know, if you're currently in another position elsewhere and then they see that, what happens if you don't get it and you're still working there, that that's not a great situation for the the other

2:02:07 candidates who are not offered the final position. So, people may not go down that path otherwise. I I guess I just want to say in terms of transparency, I think that we could be transparent about the process about the job description and the things that we're looking for and how we're going to go about it, but it doesn't mean that every that the public should be privy to all of the this behind the-scenes steps because I do think it's a pretty sensitive um a sensitive thing. Yeah, Commissioner, one of the one of the options I I think um given that this is a municipal utility, we represent the public and you all represent the public um is to at some point in the schedule

2:02:53 um offer a specific I don't want to say hearing, but a specific opportunity for the public to weigh in on what they see the priorities of the candidates in the applying for the position. Um that way you provide the public with an opportunity to um provide some insight as to what they see as the priorities, but ultimately you represent the community. Um and it can be done in a way that that allows the voices to be heard without um limiting the candidate pool process. >> Yeah. Thank you, Frank. And thank you. Yeah, I I appreciate it. I'll I'll I'll back down from from this just to be clear. Um I yeah I I just want to

2:03:40 advocate. I think it's it is important. I think I mean a lot of our community is watching and and while they do elect us to represent them, I think they're also have a a genuine invested interest in um in who our new GM is. And I'm I mean I see a per as you were saying to maybe invite public comment. And I see a perfect opportunity on we have a meeting on October 7th and it looks like the candidate search and screening is October 8th and on. And so um I mean maybe maybe we advocate for the public to come and provide public comment and and share what their perspective is and hope that they um and what hopes that they have and also recognizing that that board meeting has negative 20 minutes on it. So uh I don't I'm not sure but I

2:04:26 yeah I just I'm I'm grateful for this conversation. just want to advocate for for if I'm a community member, what I would want to see. So, >> yeah. And then John, >> uh, one thing that came to mind was maybe there could be an anonymous, um, outline put together on what the vision for the organization might be from each of the final candidates and that would give some glimpse to the public of what, you know, the outlook might be from the perspective of the different candidates. Anyway, I know we can get into more of that in the October 7th meeting, but didn't want to lose that thought. Thanks. >> I just want to caution us to be careful what we ask for because if we set up an expectation from there could be a special interest group from the community and they're the only ones that come to the come to the podium and if

2:05:12 they do and they don't get what they they perceive they want then where are we set we've set ourselves up for failure in both communities lives. I mean to me that one criteria is who's best qualified. It's not who comes to the podium and speaks the loudest or if six people oppose it or what whatever. Um it's it's who can lead this organization and continue the successes that we've had in the past. And so that's going to be my major thing. And so I got to be like you said, we got to be very careful to to get the best people. Most of those people already have a job and they're not looking. But if they see an opportunity to move to move up or to move into another challenge because there's a lot of challenges that come with this. I mean, just think of the things we have in front of us with Second Source and Mleberg and with all these other things.

2:05:58 I mean, those are huge. That's not just running every day. Those are big challenges. And so, we're going to have to find somebody that's really qualified and uh make sure that uh that do this right. And so, I'd be, you know, I'm not averse to inviting the public in to listen to them. We need somebody that's, you know, climate oriented and and diversity and and things such as that, but we also need somebody that's very industry uh aware of what's going on and where where things are going because this is such a dynamic industry both both in the water and electricity side that we got to have somebody that that can do more than just I don't know if the public knows the requirements of this job that how complex it is. I mean, look at how complex it was when you got here. Everybody, each one of us takes a drink

2:06:44 out of a fire hydrant for at least two or three years, figuring out what what they're saying. And uh I'm still doing it, you know. So, I just uh just want to emphasize the importance of not setting up an expectation that we can't meet. So um just generally I did want to mention that um uh thank you General Lawson for bringing up the uh the listening session approach or or public commentary approach. Uh that is one idea that we are contemplating adding into the October section. Um either through the um advertising it and allowing public discourse through the general public commentary or through a working session approach in October. Um, I will

2:07:30 also mention um uh Commissioner Broski when when he spoke with me about the board materials prior to uh departing uh mentioned that he was he did have some interest in a public hearing listening session um on uh what the rate payers are uh would like to see within uh within a new general manager. >> What about staff input? Is there is there a place for that? >> So, it's a wonderful question. We will be seeking SA staff input. We wanted to wait on that piece of the process until whether or not we know we have internal candidates. Um, from a optics

2:08:15 perspective, it would be best if internal candidates do not weigh in on certain aspects of the process until after they've disclosed themselves. Then one more comment about the the public input. I guess if there's a way that it's not just a free-for-all that people can just stand up and say what it is that they want. Uh, I'm even thinking if there was like a survey or something that could go out that was a little bit more guided because people might have these ideas of who they want to lead the organization, but it's it's not like just the general public's wish list. you know, there there's a lot of very technical or fine-tuned things and um I don't want to

2:09:00 give the impression that we're just open to what everybody has to say because a lot of people do come before us and they have certain things that they're interested in, which is is fine, but they might not see the breadth of the organization or even what it takes to run an organization of this size, you know, the the kind of qualifications. So, I guess I just want to caution about just saying like tell us what you want. I think this just a a little bit of just feedback. I think this board has

2:09:46 been really good about understanding the the difference between the loudest or the most prevalent voice and the the details of of making decisions on behalf of the community and and wrestling through those issues. Um recognizing also that it's not a popularity contest and I think this board knows that. I certainly know that. um and the the complexities of the position, the uh complexities of and passion of the community brings that out one way or another. Um and this board has been very good about uh having context around that. Um some great ideas. I I think that um it's an

2:10:31 opportunity probably on October 7th to to talk with some experts in the field as to far how other organizations have done it. Interesting idea around um when you get further in the process around uh authoring some some uh I'll say a blind vision u talking to customers about specific surveys. You you will get a little bit of the same thing with those surveys. the people who want to to get their voice in will get all their friends to um fill out the survey. So, but this board has been very good about that um and in the past. But there there's a number of really interesting ideas to to let the public know what's going on and and also

2:11:17 recognizing that you represent the public um in the positions that you're filling. >> Just a process question. I know four or five executive sessions. Is there a law about because if we're having quote an executive session, you have no idea who else is in the room. You have no idea who because it's supposed to be restricted, but there's no way to control the environment on an executive session on Zoom or Teams. And is there any issue about that in this process where where we're going to be talking about highly confidential people and their positions and salaries and things such as that and there's no control from this process to say who's in the room, who's listening. I mean, you know,

2:12:04 and is what is the issue? What is the potential there? because we're dealing with people's livelihoods and professions and uh I want to make sure that we're we adhere to the rules that we do it in the best way manner to protect somebody's because this could be their entire livelihood if somebody says well you're looking for a job you're out here and um >> yeah the the rule itself and um kind of the detail of that rule is that um an executive session that is all in person can be all in person and uh and if you offer um any particular participant a virtual connection then you have to offer press >> right >> a virtual uh connection of which you then know there there's some risk as far

2:12:50 as who else could be looking over listening over their shoulder. So that may be something to talk about the recruiter on and um um how how to potentially manage that. You >> mind if I just jump? We we just defined what press means though in our our last goal. So yeah, >> it's yeah, it's not the the person who is signed up as press. It's who else could be you you don't have control of the environment of which they're listening from. I mean they could be at Starbucks down on Cobberg Road. Um you you there is no control over that. We do we do have a definition of press but it's the environment itself.

2:13:40 stipulate that have to be that possible or we can't do that. >> Yeah. The the way that the statute is specifically written is that if if any participant is virtual then you have to offer press a virtual option unfortunately >> commit to coming in person. >> I I I think this group could commit. I think where it really and I would even say that the recruiter could commit if the recruiter is working with you. It's if you want to have virtual interviews with candidates, that's where and not have to schedule them to fly in. That would be the where there could be some complication.

2:14:30 >> Uh thank you. So that was a a great discussion of the the timeline and the process. A few things for us to uh tee up with the recruiting source for discussion in October. >> So can I one more question. Can you guys do a doodle poll and pull all of us and see about our availability on those dates that we have to be physically present? >> Absolutely. >> Because I I already know I have a conflict. I'll be out of the country one of those dates. >> And so um how flexible is that schedule? because I'd certainly like to participate but I can't remotely. So could you maybe pull it so we can see you other people may be going places or doing things and see so we could make sure that the maximum number of people can obviously Barovski because I know he's got some things scheduled too.

2:15:15 Thank you. >> Thank you. Absolutely. um that that is why this is a draft schedule because it's based on input from recruiting sources but not really with any feedback from the five most important people uh working through the process. So we will we will um have this out once I've confirmed the recruiting source and their schedule um and we will flex around your availability. So, last up um that we're seeking guidance for is hiring standards. Um in layman's terms, hiring standards are the skills and experience that the board

2:16:00 expects a general manager to have and the duties and responsibilities the board expects the general manager to fill. The artifact that identifies these standards is typically the position description or PD. We've taken the liberty of including in the board materials a draft position description updated for 2016, the last time it was approved, to reflect staff's current understanding of the role as a starting point for the board's deliberations. Um, so my first question for discussion um is does the position description as drafted accurately convey the duties and skills expected of a successful general manager?

2:16:54 Sean, >> thank you, chair. Yeah, I um I took the opportunity to to really re review and sit down with all of this. I I'm I'm curious if my fellow commissioners have any significant things that jumped out at them, but I don't I think that this looks um sufficient. I also just want to recognize that a lot of the additions that were here I see are like how do I face this actionable so uh you know um I see skills in strategic planning and then one of the edits is and deployment and so I I just I want to recognize the intentionality of that of you know that the TM is more than just a a top level pointing the way and that's it that there's a genuine activeness involved in that in in the role as well. So, I just

2:17:40 I wanted to acknowledge that that that's that's sort of the by line that I see with a lot of these edits is is like an an intent and an actionable effort there. So, um I don't I don't have anything that stood out as majorly concerning or anything. >> I'm I'm good with it as written because I know that we always have this fourth sense where we're going to get to ask them some questions and the personal interviews and find out just how knowledgeable they are about the history of this organization and and the things facing it and things such as that. things that you can't just check off in a box and they're going to be qualif technical qualifications are one thing which I think you've covered well but also the how their desire will how how much do they really want this job because that will be reflected in how much homework they did so I'm I'm good

2:18:26 with it >> yeah um the only the only question that I had was why is the why is there a working title versus a position title and what's the value in having that versus just general manager because it seems like that's a standard kind of utility to utility sort of thing. >> It is a standard utility to utility sort of title. Um but it's also the the CEO title is reflective of um the size of the organization, the complexity of the organization when comparing it to other entities outside the utility industry. Do we if we I don't know if if this causes any other like ripple effects. If you call it something then the general

2:19:12 manager is is referred to in other policies as general manager versus chief executive off officer. I don't know if that matters or not but I just thought I would throw out that concern. It's it's fine because it's the G it's the general manager. Okay then I'm fine. Thank you for the description. I think um you know more dayto-day what you do and and I'm sure you had some input into drafting this. So, thank you for putting your spin and improvement on it. >> I'm I'm surprised when I read how much I I'm supposed to be doing, you know, it's it was sort of eye opening, >> right? Um so uh uh we're going to finalize this into a

2:19:58 final document. It it will be uh with accept changes accepted will be part of the basis of the start of the discussion with the recruiting source in the October 7th meeting. >> Great. >> Great. And uh with that that completes today's presentation on general man manager recruitment process. Thank you for your time and direction. Very helpful. Yeah, >> I just want to provide my thanks. I I don't this was maybe necessarily your vision of you know the start of your employment here. So uh just I want to say thank you and uh it's incredible that you're stepping in and providing so much clear direction. Uh so just thank you for your work and I'm and I suspect

2:20:45 along with my colleagues like looking forward to working with you closely. So thank you. My pleasure. All right. Well, it looks like we have plenty of time for great design attributes and considerations. Agenda item number 12. >> Great. Once again, commissioners, good evening. Um, for the audio record, Frank Lawson, the CEO and general manager. Um, joining me up here is u Adam Rue, our rates

2:21:31 manager. And we wanted to get some feedback from commissioners this evening on something that was really started a couple years ago. No, it's no it's been on your radar, but there are a few uh specifics that were uh that are evolving uh that we would like to talk to you about. The first one um goes back to the rate design plan from last year uh and highlighted some development work on rates uh over a number of phases. Phase two specifically looked at 2025 and 2026 and aligning some cost causation and introducing some rate design elements. Specifically, we'll talk a little bit about uh this evening your continued appetite to uh look at making

2:22:18 adjustments that align fixed and variable prices with fixed and variable costs. I want to initially just highlight um the fact that we treat rates and programs differently uh and in the sense that they have different purposes, different priorities uh and different outcomes. Uh on the rate side, uh the intent is to um align cost causation, prioritize that. Um that's done in both the present sense and also uh feedback from commissioners around the importance of that but also uh developing rates in

2:23:03 such a way that they can be uh used to inspire uh future beneficial uh consumption patterns knowing that in particular energy and water markets are changing. the time of use for example um is is important and if consumption behavior can avoid future costs then uh that helps both the participant as well as the uh general u population of e-web customers also the program side has a different purpose it's really to uh deliver a specific benefit that we believe as an organization and the board under the board's guidance has um a certain

2:23:48 outcome in mind. The the beneficiaries, investments, outcomes, those are all well- definfined, very specific. Um the rates on the rate side, it's tends to be very general across the population. And the example here and I know Julie's group is working on uh a lot of of ways to refine and improve our programs. And one example was to look at the cross-section of different parts of our population just as an example of how you would design and improve programs. Uh for example, you would want to look at income level. You know, there's there's very um different ways to do that. the size of the bill, the type of occupancy,

2:24:33 whether it's a tenant or owner occupied, the efficiency of the residence, for example, and you would be looking, a program would be designed to look for a cross-section where in this particular case, um you're going to target a program for limited income tenant with a high bills because they live in an inefficient place. And so, um, what what we're pretty excited about is to be able to, um, refine our programs such as limited income, um, to to really hone in on what's the intended outcome and who the beneficiaries are for the benefits. And so program design being having a very specific benefit delivery whereas rates are really aligned toward let's

2:25:18 let's optimize and understand our cost causation and then develop beneficial behavior to improve that that cost over time. So why is uh cost price alignment helpful? In those two pieces of of the equation, the program side and the and the rate side uh clearly differentiates and and highlights the investments and desired outcomes. It does not sort of intermix those and weave them in and confuse those with rates. And then on the rate side really improves the effectiveness of how we design our product and how we can drive beneficial consumption for long-term uh value and benefits for the customer. So it having

2:26:04 good on the rate side having good cost price alignment is helpful for both programs program clarity and also to drive beneficial cost um outcomes over time. So, one of the things that I I know you hear and we've we've heard and we've we've we've studied this through through time is u just a a piece of information. Low usage does not equal low income. Um we've we've done studies um within our customer base. It's pretty much the same consumption profile with those who participate in our programs. Um, I've also talked to some other general managers who who really their work has shown the same thing across the

2:26:49 Northwest. So, this is not uh unique to EW Webb. Uh, and then I'm going to pass this to to Adam to run through the next two slides um just to give you um some insight into how fixed and variable costs um relate to each other and then where other utilities are uh from a basic or fixed charge perspective. >> Thanks, Frank. Um so this looked at our most recent cost of service and our current rates. On the left you can see um the table of the um the different costs. Our current rates being $30 a month. And then we have a delivery charge for residential that's build per kilowatt hour and an energy charge per kilowatt hour. our cost of service is a shows a slightly higher fixed monthly

2:27:36 charge being kind of the result of that analysis and a slightly lower energy charge. Um when we look kind of as we talk about the fixed variable cost discussion and the residential demand charge had been kind of on the agenda for for looking at um the facilities charges currently build per kilowatt hour for residential. the commercial classes have a demand charge that recovers those costs. Um so we did for the uh purpose of this chart convert the facilities charge into a uh monthly fixed charge. So if we recovered those costs in that way instead of a per kilowatt hour residential demand that kind of shows the line that's uh slightly less steep sloped um that has a

2:28:24 higher basic charge and and adding those two together will be roughly $65 a month to recover all those TND costs and the what's currently recovered in the basic charge fixed monthly basis. So that those being kind of the different approach is either a demand charge, continue use a delivery charge or or a fixed monthly charge. >> I interrupt you. Yeah, sorry. I know we're supposed to save our supposed to save our questions to the end. I'm just getting confused. I don't know if it's just because I'm tired or >> but can you just explain like what the difference is between So currently we charge 30 a base rate of $30 and then we charge that's our delivery charge and energy charge. So what what is cost of

2:29:10 service and fixed how is that different? So our the current rate is what like customers currently get charged. The cost of service is based on our what our um analysis of the costs are. Um it's slightly higher on a per monthly basis. So that's the 3411. So if we would have fully implemented our cost of service, it would have been slightly higher fixed charge. Instead, we have a lower fixed charge and higher energy. Okay, >> I'm going to translate a little bit, but I'm not going to use any numbers. So, um, the most expensive Electron is the first one we deliver. There's a certain amount of infrastructure we have to invest just to get you access to

2:29:56 electricity. The line, the orange line that you see up there is the present way we price products. Um, there is a certain amount of a fixed charge that we incorporate into our variable rate. Um, and so there's a little bit of risk. And what this shows, if we moved that fixed charge all to the basic charge, all to a fixed charge, we would have this blue line that would take effect. And that's probably more representative of our actual costs, the blue line, not the orange line. What that means is that, and and this is where it's it's a hard thing for people to understand, there's that crossover point of about a thousand kilowatt hours a month. It's a little bit under that. If you are consuming less than that, you are not paying your

2:30:42 full fixed charge. You are in essence being subsidized by those who consume more. And so what what this kind of leads to is that people go, "Well, I you're raising my fixed charge and and I don't use very much, so you're you're unfairly charging me." The the reality of it is because you use less you and in the present rate structure, you are not paying for all your fixed charges. And so I did that without any numbers. But the reality of it is that we have more fixed charges right now than we charge in fixed prices. And so there's this that's why there's this disparity between low consumers and high consumers. We're getting into questions. All right.

2:31:27 This is good. You did a good job. So the the fixed charge in here I think the partially the reason that I was a little bit confused by it is that usually when you think of a fixed charged it's stable it's one amount but we have I'm assuming the way that it changes is that in order to provide more power then you have to upgrade a transformer you have to put in more line to access more units to then have the ability to provide that. Is that correct? Yeah, there there is there's a couple different philosophies around your infrastructure and how much of it is just sort of basic delivery versus how much of it is based on the fact that you might have larger infrastructure because you have more demand. Some of that in the non-residential pricing that

2:32:14 we have is recovered in a demand an actual demand charge um which is based on the peak usage. Um that is something that over time we have talked You know when we say we have actually mentioned that having a residential peak charge would account for the the infrastructure that's needed. Residential is a little bit different because most residents have kind of a similar profile. So incorporating the basic transformers, wires, these things into something that's a little more fixed for cost causation purposes makes sense. Now there's what we'll show on the next slide is different utilities have different philosophies on on that

2:33:00 subject but I I don't know if I answered your question. >> Yeah thank you. >> Thank you chair. Yeah um in the backgrounder you provided um a link to oh my gosh what was this either September of 2024 the discussion there and it had um a clear explanation of what each of these charges are except for facilities charge. Can you describe what a facilities charge is? >> Yeah, that's the transmission distribution costs. So that what that's the costs that are in the delivery charge line and in that presentation this was just to illustrate the point of that those being considered fixed costs and instead of just making that one number higher just going to add it a line >> connected two dots. Thank you so much. >> In other words, Adam made it up. So I'm

2:33:46 I'm I'm buckled in here. Adam, let's get into it. Yeah, it was a it was a portion of what was historically cap recaptured as a portion in the delivery charge. Adam separated it out, gave it a new name. >> All right. Uh, and this chart is the similar comparator group that we look at typically with the average monthly bill. >> Is it? >> Oh, did you? Oh, yeah. Sorry, that I moved my slide. Um, and so this is the same comparator group just looking at only the fixed basic charge that that different utilities charge. So this one kind of to Frank's point at different utilities, they'll take a different philosophical approach to this. You can see some of them that are on the higher end presumably are

2:34:32 recovering some of those uh facilities fixed monthly charges related to transmission distribution in their uh charge. um to most likely to come up with the 40 or yeah the $49 a month charge. You can see the other to the left of the chart, the regulated utilities, Portland General and Pacific Power have the lower end. Um those are typically on the high end of the overall bill, but that's just a different approach. Those PC regulated ones have different mechanisms to make them whole if they have um lower consumption overall. Also, if they have like a mild winter and and lower usage, they have a search charge that they would be able to recover those costs through. So, it's just kind of a their risk mitigation

2:35:18 tool. Instead of a fixed monthly charge, they have other mechanisms in place. Um, but this just shows where we are relative to that comparator group. >> Yeah. And we were already getting questions and feedback, which is great. I think what we're trying to do is is kind of under the original plan we were um because of the importance um that u the commissioners expressed also in understanding cost causation and over time designing uh and having rates that would inspire beneficial behavior. Some of that is uh obviously in things like time of use um and demand response and some of these other programs. But in order to really springboard into those

2:36:05 um having a a really solid uh linkage between cost and price gives you the platform to do that. Um, we also, uh, really see some differentiation in what we do in rates and the prioritizing of of what those are for versus some of what you hear in the in the public around kind of confusing rates with programs. Um um we're really looking at this as rates are very kind of pure relative to their cost recovery and then programs are very specific for interests that the community and the commissioners might have uh with very intentional outcomes. And so kind of with that as the backdrop, our plan had called for some adjustment and movement from

2:36:51 variable um prices into fixed components. And um did that does that still make sense to commissioners? And um when people show up to make comment about it, what's your appetite to support the fact that there is is uh this is part of a a bigger picture with different intent and um that fixed charges do reflect our our cost and our cost recovery. So that's what we wanted to get feedback on. We've already got some questions. So, we'll just turn it back to you, President Schlloberg, and and um listen to what commissioners have to say.

2:37:37 >> Um I'm okay with uh increasing fixed charges because there's enough subsidy going on. I mean, if people got to pay at least their base what what it's costing. Um you granted, I know there's that that argument saying, well, if I use less, I pay more. I mean, I've got two lane electric accounts. I have that used a kilowatt in two years. I'm paying them 50 bucks a month because they bury the lines into this place and everything else. They're not getting a penny of revenue from me. And so, it's that they have to recover the costs. And I I get that. And so, uh, you know, it's the same discussion. I was on the board. We used to have tiered rates for electricity where it was just like water. And we went away from that. And there was a lot of discussion about it. I'm not afraid to go to go back to, you know, charging what it costs.

2:38:22 >> Yeah. So, Commissioner, thank thank you for bringing up the tiered rates. There's um there there's aspects that we need to keep in mind. So, the reason that we moved away from tiered rates on electric and not on water. Um on the electric side, the tier rates created an artificial deterrent um at the where where the the the tiers were placed and how they were structured from um electrification um aspects. What happened was you would um pay a lower rate if you had gas and if you went all electric, you would be moved into the higher tier. So there was a recognition that we wanted to remove that particular barrier. Um on the water

2:39:08 side the the tiered rates are really in recognition that u as an essential service um the water has a base level of consumption. We tried to keep that as affordable as possible for basically for drinking water, toilets, essential aspects of living. the the tears start to come into play when um personal choices take over. And so there's a little bit of a difference between water and electric on the the use of tears. >> So the problem that is solved by switching to the other rate is that

2:39:53 there's less cross subsidization. Correct. that that's a piece of it. Uh, Commissioner Carlson, I think the other aspect is when we start to get into more specific rate design, uh, the platform to create the the incentives around time of use, demand response has a foundation based in cost so that as people change their behavior, um, the benefits of that behavior will be more easily tracked and understood and thus divided um, between them and the rest of the customers at large. um when you have um a misrepresentation of where your costs actually lie in your prices, designing programs that that incentivize good behavior is becomes much more arbitrary

2:40:39 at that point. Um and so we see this as a little bit more foundational than just oh there's cross subsidy that's the only reason to do it. This this is why we would probably not take a big bang approach to this and do it all at once. We would do this in preparation for some of the other um pricing mechanisms a few years from now. >> So on the you can go back to the other one if you don't mind the chart with the Yeah, there we go. Okay. So >> did I go too far? >> The other one. >> So I have three screens here. So which one? >> Which one I'm looking at? Um so if we the decision that you would like us to make is either stay with current price or direct you to look at doing this

2:41:26 fixed delivery cost of service methodology and would that so that would mean then we're raising the basic charge up and then we're we're decreasing the energy charge overall >> essentially. Yes. Now, we're not necessarily asking for the whole big bang all at all all at once. There there is if you raise the fixed charges, there's a um a compensating lower variable charge because some of your costs are captured in one or the other. There it's kind of a zero someum game when you're at that midpoint. At the crossover point, it's a doesn't matter. It's it's the same cost. Um, I think over time we're going to have to look what what we're asking is is the board

2:42:13 still have the appetite to recognize that there are more fixed charges and we want to progress that way. It's maybe not all at once, but also as a kind of a platform to then springboard whether we want to have uh demand charges, time of use, some of these other things as they they develop. But if we did it today and it was truly pure, the fixed charge would go from something like 30 to more like 60 64. Um that's if we did it without gradualism and some of the other things that we talked to the board about. But um and then the energy charge would be reduced accordingly. But that's not we're we're asking for does this still make sense to make progress in this direction. So in some respects then

2:42:58 it would be a disincentive for um people who do solar and generation on site because where we would actually be lowering the energy charge and it might make their their because if you you have to pay the fixed rate you only get the payback on the energy charge, >> right? Right. So we might have a different um >> we we've also placed a number of constraints around those who net meter. Um for example um the net metering is reset every month. Part of that reset is because they don't pay for their full fixed charges. If they were paying for their full s fixed charges, you could you wouldn't have to reset that every

2:43:44 month. You could go a whole year. they they could basically build up some some level of credit in the summer and pay that off in the winter as long as they were paying for the infrastructure to send it both ways. Right now they are not. So that's why we have a reset every month. >> I'd be curious to see what that difference would look like. Also, can can you go back to that previous slide again? >> Which which direction? >> The one right before this. So 43. Yeah, that one. Okay. So if if the sweet spot is a thousand then so some of these folks it does seem like there I mean obviously it's especially in the higher tiers it seems more equal but in some of these lower

2:44:29 tiers it seems like there is a little bit more spread. Well I guess maybe not in the 100. I'm just trying to see if there is any more spreading. >> Yeah. Um >> and I think this is where the our our more detailed segmentation and understanding of of customer data >> starts to drive the program. So for example, we could have the rates sort of migrating like we are, but program design could be very specific around really trying to help and maybe maybe it's a a credit every month that goes toward um a certain part of their their bill, but it's the program design then takes care of this issue. It's not it's not a rate design issue at that point. my appetite for this um would be

2:45:18 persuaded one way or another. I think in more if I could see actual examples of what bills would look like in each of these categories in one scenario versus the other because this this doesn't quite tease that out for me in the same >> Okay. Yeah, that's we can put some examples together and then um I know that commissioners will hear more about some of the programmatic work from Julie's group um later this year. So that'll give you a little insight into how um some of the specific outcomes around um tenants versus limited income versus high bills, you know, those are those are all different things because somebody can be not all tenants are limited income. Not all people who are tenants have high bills or low bills.

2:46:04 So, we're we're trying to find that intersection and we're make it there's a lot of data that that we have, some that we don't have. So, that's but getting a sideby-side bill comparison helpful. >> The impact on limited income specifically across these different categories would would be a a persuading point for me. And so, for me, I can't say, you know, yeah, and yeah, let's go do it. I I I think what the data shows us, Commissioner, is that the impact to our general population will be the same impact as to limited income. >> Okay. But I still want to see what that impact is. >> Okay. Got it. >> Thanks. >> Thank you, Chair. Yeah. Um just make

2:46:52 sure I understand the X-axis. That's kilowatt per hour >> on this one. >> Yes. >> Okay. >> Yeah. That's the average monthly kilowatt hours consumed. And so, um, I think our overall average of all our customers is somewhere a little under a,000. Um, it's a little different. We when we give you rate comparisons with other utilities, we use something like 1,600. And part of the reason for that is that represents an electric residential home. So, but this is based on so those categories there are our average overall system average being a little under a thousand. But those are the way things we just grouped those to look at a comparison.

2:47:39 Um what's consumption for those who are on our limited income program versus our general population just as a side by side to see if there was a difference between consumption and income. >> I appreciate that. Yeah, I this chart I'm finding really challenging and I think taking a step back to respond to your question where we're at large is it is really hard to have this conversation and it's in just a vacuum and I want to acknowledge I know I looked it up December 2nd is when we're having the energy efficiency with low so I'm ready for that conversation for sure but um the impact of this partic like for if I'm uh a person who is seeking an ability to lower my cost for energy usage. I'm going to look for our programs, duckless heat pumps, you know, window because if I'm a moderate income

2:48:26 homeowner, the approach of that is extremely simple. It is I contact EB, go for the rebate, uh put in the installation myself, bing bang, boom, I'm done within a month or change. Um, if I'm a tenant who's especially low income, that re that requires contacting my landlord, making sure that they have that permission, going forward with that permission, potentially subjugating myself to rent increases. And in addition to that, a lot of our programs are geared towards homeowners, not renters or or renterowned homes. The the Duckless heat pump in particular, I looked up today, is uh 4,500, I think, for a rebate for owner occupied home. it's a thousand for for uh renter owned homes. And so there's just not I think

2:49:11 the impact of long-term reduction of use by with our programs is is not reflected well here. Um >> so I'll I'll make I'll make you're absolutely right. I'll also point out you're talking about two different things. >> Sure. >> Program design is different than rate design. >> Absolutely. So what this basically is illustrating is that in that 501 to,000 kilwatt hours a month the uh our general across the board population 37% of our gen I got get make sure I'm getting at the right scale here. um 37.7% of our limited income participants are

2:49:56 in that usage category and 36.9% of our general population is in that category. So this is basically from a rate design perspective telling you that basically low usage doesn't mean low income, high usage doesn't mean high income that the profiles are similar. Program design is a different intentional outcome. what you just described is this is harder to get to that that's harder to get to is is really part of that program design discussion. So rate design and have and program design have absolutely different purposes. Rate design is for cost recovery. Program design is to help customers achieve something. So that's

2:50:43 that's where the the actual intentions of those are different. I I fully understand and but my point here is that I'm there's an assumption to be made. If I'm a limited income person and I'm owning or renting my home, typically that home would probably be cheaper or less maintained than a more moderate or wealthier individual in our community. And therefore, uh program response can be more impactful because there is there are not duckless heat pumps already installed. The windows may be out of repair. the the front door might be falling off its hinges, you know, and so there are direct efforts that but like I my my point here is is to respond of it is hard to have this conversation of

2:51:28 rate design without the in tandem conversation of programmatic response as well. Um, so I I do like I I can see support for um moving forward with uh more fixedterm cost um while also maintaining the balance to support people in that variable. You know, if I lower my my bills or if I turn off my lights at a very appropriate time and I'm responding in that way, um then I want to see that reflected on my bill. But also I I want to recognize that that this is not a a a singular insular conversation that this has to be >> absolutely agree and I and I think that one of the I I know that staff has been frustrated a bit with the the discussion around rentals because what we want are

2:52:15 trying to figure out and this is where where Julie those concentric circles start to happen is just to say rentals uh rental properties is is different than you want to help specific categories within rentals. So that's why I use the example you're looking for tenants who have high bills and inefficient properties that they live in who are tenants. You know those you start to really design your programs with intentional outcomes and you don't confuse that with your rate design which is cost recovery. you really design your programs with an outcome that are is very well understood, tailored, fine-tuned. Um, and um, that's it's

2:53:01 going to be fun actually. I'm sorry, it might not be fun for Julie at the moment. That's going to be really fun to be able to have programs that have such a really clear purpose that we have the data for to to really find out and prove segment by segment, profile by profile, demographic by demographic that yes, this is working. It market penetration is great. Um versus it's we're not meeting the need. And this is really in response to commissioner's interest and interest in public. >> I I have a final point and then I I'll be done of I I I appreciate that and I just like my my concern is is how much can we reduce the the amount of of price

2:53:48 and patterns for more lower income, more more challenged homes habitability wise rather than you know how much how much can that ball be pushed further. And so that's that's just my my my thought here of yeah wanting to address that. Yeah. Thank you. >> Um I guess for me I think I just what would be useful is a translation like maybe some scenarios would uh illustrate what you're trying to say better. I think like I can look at the graph or whatever, but just if you gave us different scenarios about uh homeowners uh mid versus low income in different situations, same with lower income. Um I

2:54:33 just think it would be maybe just easy a little easier to >> digest. So okay, >> maybe in December we can go from some quantitative to qualitative kind of presentation. Go ahead, Sonia. >> I just wanted to make another point that I I you know, as I look at this chart, I see okay, there's limited income that are still paying over I mean or have consumption of over 5,000 kilowatt hours. I mean, we don't know the situation. They're maybe they have a business that they run at home and that consumes a lot of energy. Um but to the extent possible if they are consuming that much and there are resources or ways that we

2:55:18 could assist and also limited income doesn't mean that they are poor or challenged financially. It just doesn't mean that they have money that's coming in. We could have a big savings account and not have a lot of in new income coming in. So I get I will just say I think the nuances of that are challenging and I appreciate that you all are looking at it with that nuance and intentionality. Thank you. >> Yeah, absolutely. I think those are the the demographics questions are particularly part of what what we're interested in. Um and then sort of aligning and and it's it's a little bit like playing 4D chess. Um we're we're trying to have multiple layers. Um the

2:56:05 premise the income there are certain individual demographics like like income that we're looking at. Then then we're also looking at consumption. Consumption now could be related to the size of the bill. So you know those are all things that that's why there were four circles on there. I probably could have put more circles and narrowed that in even more. But the intent is to really understand when we say limited income, which part of limited income are we talking about? Are we talking high consumers means high bills, but is that really how does that cross with the high bill is because it's inefficient or is the high bill because there's a whole bunch of people living in I mean I you know, you don't know that we're trying to get into those details. And it seems like maybe it

2:56:50 would be more valuable to say like who is vulnerable and who can we actually help >> because that's what we're really looking for. >> Exactly. I mean would would we if someone lives in a super efficient um place and um they were still limited income. there's a certain support that we have for that versus trying to design the energy efficiency program for a particular. So those >> it's not one program meets everybody either. You can have different program design. So I think that's that's where we're headed. Like I said, it's going to be fun for Julie.

2:57:37 >> Great. Did you get what you needed? We got more than what we needed. >> Great. All right. Thank you. >> Thank you, Commissioner Morris, for that all that stuff >> specific. >> All right. Well, we are winding up here. Uh, agenda item 13, future board agendas. This does seem pretty fluid. Um, got some some things to incorporate. I I will make a note that I will be remoting into the October meeting. Um I'll be um at a conference, so I'll turn over certain duties to assistant general manager Hart while she's um present. And then um I'll be able to support remotely

2:58:24 as as needed. That's just one note. And then we do have the the safety fair um safety expo September 11th. Um all of you are as as always invited to that. And so those are just a few of the comments I'll make. But other thing things are pretty fluid and now we will start to uh work with Diedra on incorporating um some of the general manager processes >> and there is no work session on September 16th. Correct. >> There is not. you were so efficient today that um Dedra did not Oh, she's back there. Yeah, she she did not need to spill over either into rate design discussions or

2:59:09 to a September work session. >> Just have a question noting that none of the GM recruitment processes in any of the agendas. um what's going to give because I'm looking at uh are we going to kick off recurring things or are we going to just have extended meetings or you haven't figured that out yet? >> Oh, um I haven't figured it out yet, but just to answer your question directly, I would tend to probably prioritize the emerging the goals. Recurring items can in some ca in many cases be handled through correspondence. Um this this uh group of commissioners is particularly good about reading the

2:59:55 400page background materials. Um not all boards are like that. So um probably some of the recurring items would be maybe lowest on the priority. Um open for questions certainly comments discussion as needed. Um then there's certain emerging issues, goals related things, things like we talked about program design, where we're at with that. So th those some of the things that we would highlight on in the quarterly report with specific discussions, um those would um be a little bit higher priority than recurring items. >> Thank you.

3:00:46 Well, I forgot to thank folks earlier for putting on the Hayden Bridge and Lower River um tour, and I wanted to say I really appreciated that. It was very nice to get to walk out there and see the the region and hear about um some of the different issues with water uh movement that I was unaware of. So, I thanks uh for those who came out and put that together. Um, and then uh also just wanted to say how excited I am for the new features that are included in the system. That's just so amazing. I'm thrilled that we can keep pushing that forward and providing better um customer service. Um, just want to take a brief moment to acknowled

3:01:42 part of that. So, I just I really wanted to say uh just my thanks of of the responses. U yeah, thank you. >> All right, with that we will adjourn. Yeah. >> How'd she do on time?