Board Members present: Dorothy Anderson, Peter Bartel, Susie Smith, Patrick Lanning, and Sandra Bishop.

Others present: Randy Berggren, Dick Helgeson, John Yanov, Steve Hill, Jim Bemis, Jim Wiley, Ken Beeson, Marty Douglas, Roseanna McArthur, Mat Northway, Mike Logan, JoAnn Andersen, Tom Buckhouse, Jim Origliosso, and Krista Hince of the EWEB staff; members of the public; and Ruth Atcherson, City of Eugene Minutes Recorder.

President Anderson called the Special Board Meeting of the Eugene Water & Electric Board (EWEB) to order.

AGENDA CHECK

There were no changes to the agenda.

CONSENT CALENDAR

1. Minutes of the March 17, 2001 Board Planning Session.

Bond Resolution

1. Electric Bond Resolution - Capital Plan - Finance Division.

Business Service Agreement

2. Harza Engineering Company - Trail Bridge Spillway Expansion - Engineering Services - Electric Division - 25,300.

3. Cable Huston Benedict Lloyd and Haagensen - Relicensing Leaburg - Walterville - Electric Division - $30,000.

Load Curtailment Contracts

4. Safeway,

Industrial Adhesives

University of Oregon Housing

There were two additions to the Load Curtailment Contracts on the Consent Calendar.

President Anderson pulled the minutes of March 17, 2001. The remaining items on the Consent Calendar were approved.

ITEMS FROM BOARD MEMBERS

President Anderson said, regarding the Geothermal Project, that it was important to monitor the actions of Steve Munson.

President Anderson stated that the Snohomish Public Utility District came forward with a resolution opposing the DSI tiered rate proposal.

Commissioner Bishop expressed concern regarding House Bill 3633 and its effect on public utilities. She noted that the Steelworkers Union has chosen to back HB 3633 and may not be aware of its impact to utilities.

CORRESPONDENCE

General Manager Randy Berggren highlighted his participation in the University of Oregon Alumni discussion. He said that the forum featured Peter DeFazio and Philip Romero as well as himself.

Mr. Berggren confirmed that June 16 and July 21 are the two days that the next Board Governance meetings will be held. He noted that Commissioner Bishop may not be able to attend the June meeting if the legislative session is not finished.

Mr. Berggren announced that there was a river rafting trip being planned to foster team-building. Commissioner Bishop expressed concern that the expense was high. Mr. Berggren stated that the trip had been conceived of in a governance meeting and should the Board feel that it is too costly it can be canceled.

Mr. Berggren reminded Board members that the retirement banquet will be held on June 8.

Continuing, Mr. Berggren noted that there had been a letter sent to Board members on the Sierra Pine short-term purchase agreement. He said that a longer term agreement was being worked on.

Mr. Berggren discussed the memorandum sent by Marty Douglas, Public Affairs Manager, on public access television and the possibility that EWEB Board meetings could be televised.

Mr. Berggren stated that all of the signage for the Lloyd Knox Water Board Park had been completed and installed. Commissioner Smith said that she knew of a source for recycled timbers to be used to build a shelter.

Mr. Berggren highlighted the agendas for the June 5, 2001 Work Session and Regular Board Meeting, which included the final report on the Telecommunication Business Plan and the October rate proposal among others. He added that the discussion was beginning before the rate information was available from the Bonneville Power Administration (BPA) so as to facilitate planning for the rate increase.

PUBLIC INPUT

There were no members of the public present who wished to speak.

NEW POWER FACTOR RATES

John Yanov, Senior Rate/Financial Analyst, gave a brief overview of a memorandum regarding power factor rates. He stated that staff is recommending a change from an average power factor to an average peak power rate. He said that this would affect approximately 1.5 percent of EWEB customers, noting that most utilities have converted to the peak power rate for the rate assessment. He added that, due to the meter shop backlog, it was now proposed to take place August 1 rather than July 1.

Vice President Bartel, with a second from Commissioner Bishop, approved of the change in power factor rates. The motion carried unanimously.

REVIEW OF CURTAILMENT CONTRACTS

Steve Hill, Key Account Manager, presented an overview of the mechanics of how the curtailment program works with the aid of overhead projections. He stated that there were currently 25 customers on the load curtailment program. He highlighted some of the activities that the larger customers engaged in to curtail the load on the utility.

In response to a question from Vice President Bartel, Mr. Hill stated that out of a possible 300 metering points in the large demand-side class, 77 are part of the program. He said that large loaders were screened carefully so as to find the customers who could give "the most bang for the buck."

It was explained that the software to handle the billing assessment for load curtailment was in the process of being installed and that all of the billing for the month of April had been done manually.

BPA 10% CONTRACT REDUCTION

Mr. Wiley began his presentation by thanking the previous presenter for the work done on large load curtailment. He explained that EWEB is presently in negotiation with the Bonneville Power Administration (BPA) for the next power contract. He said that the 10% reduction amounted to 30 average megawatts. He stated that the contract reduction is financially advantageous to EWEB.

Mr. Wiley outlined the contingencies that EWEB is including in the contract, which include that the augmentation load is not any larger than 1200 megawatts and that the BPA is paying DSI's at approximately $20 for every megawatt. He noted that Seattle City Light is requesting $27.60 per megawatt and that EWEB has adjusted its request to match it. Continuing, Mr. Wiley said that another important bargaining item is that should EWEB reduce its load by 25 average megawatts it should not lose its entitlement to power at that level after two years. He added that another contingency is that the power saved not be sold to DSI's (Direct Service Industries). He explained the scheduling of the load reduction and that the reduction will come from the "Slice" portion of the contract. He said that the rate increase will occur in late June or early July.

Ken Beeson, New Resource Project Manager, presented an analysis of the curtailment of the load and what it will take to implement it with the aid of overhead projections. He suggested that one avenue of load curtailment that is being considered is to promote the conversion of hot water heaters to the use of natural gas. He added that there are approximately 20,000 transformers and that staff would be analyzing them to determine if any were being underused and over-powered. He noted that it was still early in the process. Mr. Berggren remarked that it is possible to supply the extra 25 average megawatts with alternative modes of power generation. Mr. Wiley countered that, while the possibility existed, it was unlikely that an alternative mode of generation would be up and running by October.

Commissioner Bishop moved, with a second from Vice President Bartel, to authorize staff to enter into a contract reduction with the Bonneville Power Administration. The motion carried unanimously.

ITEMS REMOVED FROM THE CONSENT CALENDAR

President Anderson requested that the minutes of March 17 be changed on page 6, second paragraph to reflect that JoAnn Andersen had made the statement regarding internet access and that it had been incorrectly attributed to herself.

Vice President Bartel moved, with a second from Commissioner Lanning, to approve the minutes of March 17, 2001 as amended. The motion carried unanimously.

President Anderson adjourned the meeting prior to 9:30 p.m.

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Assistant Secretary President