Board Members Present: Dorothy Anderson, Patrick Lanning, Sandra Bishop, and Paul Conte. Commissioner Ron Farmer was sworn in after appointment of the position.
Others present: Randy Berggren, JoAnn Andersen, Tom Buckhouse, Jim Origliosso, Dick Helgeson, Dick Varner, Jim Wiley, Ken Beeson, Kathy Grey, Steve Still, and Krista Hince of the EWEB staff; Joe Sams, City of Eugene Minutes Recorder; and members of the public.
President Anderson called the Regular Board Meeting to order at 5:45 p.m.
AGENDA CHECK
There were no changes to the agenda.
APPOINTMENT OF WARDS FOUR AND FIVE COMMISSIONER
Commissioner Bishop, seconded by Commissioner Lanning, moved to appoint Ron Farmer as Commissioner for Wards Four and Five. The motion passed unanimously.
OATH OF OFFICE FOR RON FARMER
City Recorder Kate Fieland administered the oath of office to Commissioner Farmer.
APPROVAL OF CONSENT CALENDAR
Minutes
Commissioner Bishop, seconded by Commissioner Lanning, moved to approve the items on the consent calendar. The motion passed unanimously.
ITEMS FROM BOARD MEMBERS
President Anderson raised concern over a letter from a customer who had gone on sabbatical and had come back to be required to submit a deposit of $400 because the computer system did not have records older than 12 months.
Commissioner Bishop called for a Board discussion on the matter. She raised concern that the deposit policy was affecting customer relations.
General Manager Randy Berggren noted that there was an upcoming agenda item on the matter. He said he would return to the Board with more information.
Commissioner Bishop said she was planning on going on the McKenzie Watershed Council rafting trip later in the month.
Commissioner Bishop expressed a desire to have full agreement on the Board level for statements of Board approval made to the public.
Commissioner Bishop said she had set up a tour the Hayden Bridge filtration facility and had invited additional members. She noted that she was not requesting staff time to organize the tour. She said she would still invite others but would tour the facility on an informal basis.
Commissioner Bishop thanked John Femal for sending the board the anthology of poetry and stories that children of the area had written.
Commissioner Lanning thanked Ms. Andersen for her help in making him understand the lost call/customer communication issue.
CORRESPONDENCE
Mr. Berggren reported that the EWEB annual picnic was going to be held on July 27, and noted that the Board members were invited.
Mr. Berggren said the Board retreat was July 9 - 10. He said a booklet would be sent to Board members before the retreat for review. He noted that there would be additional information distributed at the retreat.
Regarding the July 16, Work Session, Mr. Berggren said the entire Work Session would be dedicated to the retired medical benefits issue. He said the regular session would have an item on the upcoming budget.
DISTRIBUTED GENERATION WORK PLAN
Ken Beeson, Energy Resource Projects Manager, provided a power point presentation on distributed generation. He introduced the members of the staff who would also participate in the presentation, (Jim Maloney, New Resource Projects Manager, and Mat Northway, Energy Management Services Manager). The presentation included:
Mr. Beeson said the objective of the presentation was to get board concurrence on the need for staff to learn more about distributed generation.
Mr. Maloney noted that some of the best distributed generation projects, nation wide, were cooperation between utilities and the public. He said the Bonneville Power Administration was preparing to invest a billion dollars in upgrading distributed generation transmission systems.
Mr. Beeson said there was considerable activity around the country in distributed generation projects. He defined the term as:
"Those technologies that generate electric energy from within the utility distribution system at or near the customer's point of use."
In response to a question from Commissioner Anderson regarding the necessity of making sure that equipment owned by customers was maintained correctly, Mr. Beeson said there were standards in place to ensure that distributed generation equipment owned by others was maintained to the standards of the utility.
Mat Northway, Energy Management Services Manager noted that there were a surprising number of people in the City who were generating electricity with photovoltaics.
In response to a question from Commissioner Conte regarding economies of scale, Mr. Maloney said that currently the economies of scale still favored large generation plants. He noted that once photovoltaic technology improved there would be some significant cost savings seen. In response to a question from Commissioner Bishop regarding whether a customer could be compelled to add its generation into the system, Mr. Northway said that utilities were required to purchase generated power of more than 25 kilowatts.
In response to a question from Commissioner Bishop regarding who paid for connecting a generation system to the general system, Mr. Northway said the cost was covered by the customer. Mr. Maloney added that the utility had to make sure that the connection was up to the standards of the utility.
In response to a question from Commissioner Conte regarding where the biggest development in distributed generation would be, Mr. Beeson commented that photovoltaics (PV) had large potential but noted that it was still expensive technology. Mr. Maloney commented that cogeneration had large potential, not only for utilities, but for smaller businesses as well.
Commissioner Conte acknowledged that photovoltaics were becoming more attainable but expressed a preference for staff to concentrate on areas in distributed generation that would have the most rapid pay off.
Commissioner Bishop stressed the importance of environmental quality and said she would want to make sure the utility supported the least offensive distributed generation.
In response to a question from Commissioner Farmer regarding a timeline for implementing final strategies in distributed generation, Mr. Beeson noted that there were limited resources to work with at the moment. He said distributed generation was less than one percent of the utility's budget expenditures. He said staff were sensitive to the fact that there were limited resources but were still very interested in learning more about the concept. He said there was no target date on coming before the board with final ideas but would notify the board if any formal ideas were formulated.
Mr. Berggren said that policy direction would evolve further as more concrete ideas were formulated.
PHOTOVOLTAICS PROJECT UPDATE
Mr. Northway provided a power point presentation on photovoltaic technology. He reiterated that many citizens in Eugene were using photovoltaic technology to supply energy to their homes. He noted that interest had increased around 2000. He said the design team at the University of Oregon's redesign of Gilbert hall included photovoltaics in a "major way".
Mr. Northway said staff had decided to scrap its planned demonstration of photovoltaics and concentrate on helping customers demonstrate their own projects.
Mr. Northway said there were plans for a PV partnership that would show customer demonstration projects and plans for a PV Eugene program of 10 - 30 projects that would total 210,000 kWh generation per year.
Bob Lorenzen, Energy Management Section Manager, outlined projects in photovoltaics around the local area. He noted that there was a teacher at Willamette High School who was interested teaching and advancing photovoltaics as a teaching tool. He noted that there was a monitoring system on the University of Oregon website. He went on to say that there was a HACSA project that had been completed in April, 2002 that powered a low income housing development.
In response to a question from President Anderson regarding the total cost of that project, Mr. Lorenzen cited a figure of $35,000.
In response to a question from Commissioner Farmer regarding the cost of the photovoltaic system being installed in Gilbert Hall at the University of Oregon, Mr. Lorenzen cited a figure of $400,000. He noted that it would pay for its self in 30 years.
Mr. Lorenzen said there was consideration from the architects of the new federal courthouse to integrate photovoltaics in the design of the building.
In response to a question from Commissioner Lanning regarding what the percentage of annual electric load the photovoltaics at Gilbert hall would be, staff estimated six percent.
Ms. Anderson left the meeting at 7:35 p.m.
STEAM STRATEGY UPDATE
Dick Helgeson, Director of Water & Steam Divisions, provided a presentation on steam strategy. The presentation included:
Mr. Helgeson said 20 percent of the steam customers were responsible for approximately 80 percent of steam use. He said that the majority of steam customers still viewed steam as their primary choice due to the increases in rates of alternative sources.
Mr. Helgeson said there was a strongly established customer base with no real outcry for refitting to alternative sources.
Mr. Helgeson said the Sacred Heard contract had been extended. He noted that there had been a rate adjustment but added that it amounted to a net decrease in steam rates.
Mr. Helgeson said there was some talk about relocating boilers to have a less visual impact on the river front and to be closer to the downtown steam customers. He noted that there would be some capital investment for that alternative which would have to be figured against the ultimate plan for the future of the steam utility.
Mr. Helgeson said some alternatives and strategies would be presented more formally to the Board in the Fall. He suggested a tour of the steam plant for the new members of the Board.
Mr. Helgeson said steam operations were a comparatively small portion of the utility's revenue and was not considered a high priority.
Mr. Berggren noted that there was an issue regarding why the utility was still in the business of supplying steam. He said that the customer base was not economically able to make the conversion to other sources. He said if the utility decided that steam was not a viable operation then the question was how much resources to dedicate to the steam utility. He called for Board direction on where the utility should put its time and effort.
Commissioner Conte said there was no reason to get out of the business until something happened to make that decision necessary.
In response to a question from Commissioner Conte regarding the usefullness of steam in courthouse development or other new development, Mr. Helgeson said there were inherent inefficiencies in distributing steam to new development and added that new development was more and more efficient regarding heat. He opined that there was no likelihood of adding to the steam customer base.
In response to a question from Commissioner Conte regarding how much power was generated at the cogeneration plant and why it was halted, Mr. Helgeson said about 50 megawatts was generated but noted that it had been discontinued because it was 1920's-1930's technology and was not economically viable by the advent of the 1980's.
In response to a question from Commissioner Farmer regarding the total revenue of the steam utility, Mr. Helgeson said the total revenue matched the $2.8 million operating costs. He said it was a break even operation. He said the strategy had been to manage costs of the operation to keep things stable. He noted that the steam utility paid back its cost. He said the system was old but was still in good shape. He opined that the equipment would last at least another ten years and probably closer to 20 years.
Commissioner Farmer said he would have some concern if the useful life of the equipment was only 10 years.
In response to a question from Mr. Berggren regarding what the fuel situation was, Mr. Helgeson said staff were purchasing gas on the spot market. He said staff would be looking to lock in fuel prices by the end of August.
Commissioner Bishop said the basic issue to address was how to best serve the customer balanced with how to maintain a cost effective fuel source for steam generation.
Commissioner Bishop said she was not in favor of a joint steam operation with the University of Oregon.
Mr. Berggren said he was not optimistic about any joint steam operation with the University.
Commissioner Bishop said it was premature to think about a phase out of the steam utility.
Mr. Helgeson said he would provide a summary of the Board feedback in memo form and provide it to the Board.
PUBLIC INPUT
Zack Vishnoff, 1312 Mill Street, said the courthouse neighborhood was on the wrong track and urged the Board to use its influence to make sure the entire area was not paved. He said if the utility were moved it would allow the area to be planned in a more environmentally friendly way. He suggested requiring more of a focus on opening the mill race. He said the Board could help by attaching conditions to its moving. He raised concern that the City of Eugene was only interested in leveling the entire area, trees included. He urged the Board to meet jointly with LTD and the Planning Commission and other committees to make sure that the City was being more environmentally friendly.
ITEMS REMOVED FROM THE CONSENT CALENDAR
There were no items removed from the Consent Calendar.
The meeting adjourned at 9:30 p.m.
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Assistant Secretary President