|
Services & Resources
 City Forms and
Applications
Job Opportunities
Utility Information
Pay Utilities Online
City Departments
Building & Safety Division
Code Enforcement
New Development
Fire Department
Legal Services
Leisure Services
Parks Maintenance
Police Department
More...
City Council
Agendas & Minutes
Mayor Dan McArthur
Council Members
Public Transportation
Conservation
|
|
Water & Power Board
Water and Energy Services Board Meeting
April 09, 2008
Water and Energy Board Room
811 E Red Hills Parkway
St. George, UT
3:00 PM
PRESENT:
Chairman Ross Hurst
Board Member Marge Shakespeare
Board Member Max Rose
Energy Services Director Phillip Solomon
Water Services Director Barry Barnum
Conservation Coordinator René Fleming
City of St. George Staff: Scott Taylor, Laurie Mangum
Excused:
Board Member Craig Hammer
Board Member Brad Rich
Council Member Jon Pike
Opening:
Chairman Hurst called the meeting to order and welcomed everyone in attendance.
Approval of Minutes
The minutes of January 9, 2008 were reviewed.
Motion:
Board Member Rose made a motion to approve the minutes as corrected.
Second:
Board Member Shakespeare seconded the motion.
Vote:
All voted aye, motion carried.
Chairman Hurst inquired about customer options for assistance with their utility bills and if there were any available funds to those who need them.
Conservation Coordinator René Fleming responded saying limited funds are available.
Review of Financial Statements
Water February Financial Statement
Water services Director Barry Barnum said even though the financial report indicate revenues are down for the month, they are actually up for the year.
Conservation Coordinator René Fleming explained to the board how the new billing cycle will be processed. Instead of billing twice a month, the billing will be broken up into four cycles.
Chairman Hurst suggested it could be the year 2009 before getting an accurate comparison.
Water Services Director Barry Barnum said last years fiscal year-to-date dollar amount spent on transmission and distribution was 2.6 million dollars. This was due to building a new water tank at the Ledges. So far, no new tanks have been built this year.
There was some discussion regarding Alpha Engineering and the designing of the South Tank. The City is still working with State Lands regarding the easements and the location of the tank.
Water Services Director Barnum said the City would like to build two (2) million gallon tanks but, School and Institutional Trust Lands Administration (SITLA) wants the City to build only one (3) million gallon tank.
Mr. Barnum said there are several benefits in having two tanks: lower building costs; maintenance issues; fire hydrants remain active and water pressure to surrounding areas is not disturbed.
Information regarding the value of two tanks vs. one tank was submitted by Alpha Engineering to SITLA and they are looking at the footprint. This option is still under consideration. New tanks are now constructed from concrete, they fit better in the ground and they are safer.
Mr. Barnum said there is a slight profit showing for the year with the heavy use season still to come, which would help to end the fiscal year better than the budget reflects.
Energy February Financial Statement
Energy Services Director Phillip Solomon explained the difference between the two statements handed out (see attached). Mr. Solomon said, Energy Services will continue to try and shave the actual aggregate cost of power. Last year’s fiscal year-to-date shows 5.5 cents per kWh and today it’s at 5.75 cents.
Mr. Solomon indicated industry costs are rising significantly. Energy rates are on the rise; APPA dues will be increased by 10%, which reflects on the City’s cost, there is an increase in the Deseret Generation and Transmission (DGT) contract that was built in, gas prices are extremely high and going higher.
Mr. Solomon said the department’s cash position is still healthy at this point. There was 1.8 million dollars expenditure to pay the down payment of the new gas turbine. In estimation, by the end of the fiscal year the cash position should be approximately nine million dollars.
Impact fees are tracking close to last year because of commercial installations. The Data Center, even though a small building, will be using 4MW of power.
In reviewing the cash flow, and with a very volatile market, the overall amount in reserve for the year was up to 2.856 million dollars and the forecast was at 2.2 million dollars. More was spent on capital improvements than forecasted but the Department’s reserve is still ahead by 2.4 million dollars.
Energy Services Director Phillip Solomon talked about hedging gas for the summer. May, June and September are OK but July and August still need more stripes of gas. Mr. Solomon said because there was an abundance of water this year hydro resources will be very good, which causes the demand for natural gas to go down. Because natural gas is still at the $10 mark there has been discussion of selling the hedge and using the profit to buy on the market with hopes the gas prices will crash.
Energy Services Director Phillip Solomon said there is a possibility of a metering problem and would like to have Phil Peterson review. Overall the financials are reasonable.
Brief Project Updates by Water and Energy Department Staff
Energy Services Department
Energy Resource Planner Laurie Mangum spoke about the planned resources chart handed out (see attached). Ms. Mangum said resources have been arranged as far ahead as the year 2024. Since the last quarterly meeting, the only changes that were made in the graph are one extra unit at Millcreek Generation Facility (MGF) and writing in another coal plant at some point. By the year 2013 the City should have another 20MW of base from the proposed Two Elks project and in the year 2016 another 30MW from the Bonanza resource project. Also added to the graph are the solar, landfill gas and the Jordanelle projects.
Energy Services Director Phillip Solomon talked briefly about the Two Elks project and getting a Memorandum of Understanding (MOU) within the next week. This project is located in Gillette, Wyoming in the heart of three coal mines. It will be a waste coal project with no rails involved, natural gas comes through the site. In the term sheet, the City has requested first right of refusal for all resources developed at this site. Phase one will be 325MW. The City is currently working with UMPA to get the power transmitted to St. George.
There are three equal partners in Two Elks: Yempa Valley Electric at the Colorado border; UMPA and Northern Energy (Two Elks). Northern Energy will hold 51% of the project. Being locked in to a Power Purchase Agreement (PPA) means being guaranteed a price. In the event the project doesn’t deliver, there will be liquidated damages and the project will pay the City.
In looking at the real time market purchases and sales, for the year 2009 31MW is still needed. With implementing the Two Elks project, the need for gas is significantly lowered bringing the City’s market exposure very minimal.
Energy Services Director Phillip Solomon said according to APPA power costs have increased by 71% in the last nine months. These increases are primarily due to construction costs like steel, copper and labor.
Energy Services Director Phillip Solomon gave an update on the MGF and the anticipated purchase of two turbines. Because of circumstances with Questar Gas, and their non-commitment to deliver enough gas to operate two turbines, it was decided to only purchase one. The site expansion and air permit submitted to the state will be for two turbines for the purpose of growth. The development agreement will start in June.
Conservation Coordinator René Fleming talked about the energy consumption in homes today and will be doing an analysis to try and determine how much it has increased within the past 8-10 years.
Water Services Department
Water Services Director Barry Barnum gave an update on the extension of the reuse line to the east side of the freeway at the Interchange mile post #2. This will be used for construction water and possibly the golf courses. Construction of the reuse line will be going along the construction of the southern corridor. Phase 2A will go from the interchange to approximately halfway to River Road. Phase 2B will continue from where 2A ends to the rest of the way to River Road. This will take approximately six months to complete. The City of St. George, UDOT and SITLA have all agreed to share the cost.
There is an agreement in concept that the same participants will continue to extend the line to the new airport. Any extension beyond the new airport will be between the City of St. George and UDOT if the City chooses to do so. This allows the City to get a good expansion of the reuse system at a low cost.
Chairman Hurst asked if the Bloomington Country Club was using the reuse water.
Water Services Director Barry Barnum responded stating Sun River and Bloomington Country Club have six year contracts with the Shivwitts Band of Indians (the Band) to purchase their reuse water. Currently, the City is delivering the water on the same terms as the Indian contract on behalf of the Band. The City is collecting the money from Sun River until the Band and the City come together regarding an easement resolution for the West side improvements.
Another reuse expansion project currently in progress is from Southgate to Snow Park. Part of this project is boring under the Santa Clara River for the pipeline with the 9th boring hole underway.
Water Services Director Barry Barnum reported on the west side improvements. This project is still under design. The issues regarding the easements with the Band still need to be resolved, but a temporary solution will be implemented. A new five million gallon tank, known as the Anasazi tank, will be placed on a hill south of Ivins City and will become the blending tank rather than the Gunlock tank. Water access to and from this tank has been resolved in order not to trespass on Indian property.
The West side improvements will provide additional storage and the mixing of arsenic for the Gunlock wells. Ivins City, Washington County Water Conservancy District (WCWCD) and the City of St. George will be participating.
Mr. Frank Kell, Irrigation Division, is retiring after 32 years of service. There will be a reception for him on 4/15/08 from 2:30 – 4:00 p.m. at the City office. With Frank’s retirement, the Water Department will be undergoing some reorganization and reassigning some employees to different positions.
Water Services Director Barry Barnum expressed to the Board the department looks good for this year. Everyone should be getting their full allotment of water with no anticipated problems.
Energy Services Staff Project Update
Energy Services Director Phillip Solomon gave an update on the County Landfill Project. A letter was received from the County Solid Waste District giving St. George the go-ahead to move forward with the bio mass project. The letter states the gas will be issued, but negotiations on how to get it need to be completed first in contract form. Siemens would now like to move forward with the design and construction but the gas rights contract needs to be established first with the County. Test wells will have to be completed prior to the gas system installation to make sure there is a viable supply of gas for the project. Siemens is currently working on a revised LOI and some sample gas contracts.
Transmission on the West side is moving very well and ahead of schedule in some ways.
Issues have come up regarding the Lakes property. A signed development agreement between the Lakes and the City of St. George has been executed but rights-of-way still need to be recorded. A cease and desist order was issued to stop the project until a model can be done to show what the new poles would look like in a populated area.
Energy Resource Planner Laurie Mangum gave an update on the Solar Farm Project. Approximately 6,000 panels will be placed on seven acres of land which will produce one MW of power. Installation will be done after each 100kw is sold by the Energy Services Department. This project is in joint venture with Dixie Escalante Electric with a cost of approximately $6,000 per/kW. This should give the customer a tax credit of roughly $1,500/per kW share. The program will be designed so the customer will sign a contract with the City, once the project is on line the customer will start getting the credit on their bill. Also, the customer can buy, sell or transfer their shares within the City. Assessment charges will be charged every 20 years in order to replace the panels as needed. The panels are guaranteed for 25 years. A campaign meeting will be set to meet with a marketing group in Salt Lake City to create a marketing plan.
Energy Resource Planner Laurie Mangum shared an email from Western Area Power Authority (WAPA) stating the City of St. George will receive 15% more power, which is 5,000/kWh more at $10 per kWh because of the abundance of water.
Energy Services Director Phillip Solomon gave an update on UAMPS. After numerous years of being a part of the Payson Project the City has finally been removed from the Project. This is a savings of $180,000 per month. The City has also sold the UAMPS wind and received $200,000. This brings the monthly UAMPS visit to one day per month instead of three. There are only three projects the City is still involved with: Pool Project; Craig/Mona Project, which is a transmission project and should be paid off in the year 2009 and the Central – St. George 138 Project.
Energy Services Director Phillip Solomon talked about industry changes, reliability and APPA Awards.
APPA Awards: Energy Services received awards for being reliable (the RP3 at the Platinum level). Energy Services also received the First Place Safety Award which is very coveted and hard to get.
Industry Changes: There are still a great deal of climate related issues and the push to mandate renewable portfolios. The House Bill 201, sponsored by State Representative Brambell says 25% of new resources must be renewable by the year 2025. It is unclear if this bill applies to municipal or public power utilities.
Reliability Standards: A considerable amount of staff time has been spent toward complying with the reliability standards. Federal Energy Regulatory Commission (FERC) and the North American Reliability Council (NERC) is pressuring the local area coordinating councils to make sure that all standards are in compliance. Audits are being done and large fines are being imposed for those who do not comply.
Conservation Coordinator René Fleming explained to the Board the upcoming energy fair that will be held on Saturday, October 11, 2008 from 10 – 3 p.m. in Town Square. Community involvement is a priority so there will be competitions, energy saving informational booths, free hot dogs, water conservation, career information and demonstrations. Different companies will be approached to be sponsors. The solar farm will also be a main element at the fair.
There are now 15 blocks of green power sold per month. Another ad will be inserted in an upcoming utility statement to help educate the public.
Approval of Amendment to the Billing Policy #10.87.87
With the approval of Mr. Phillip Solomon and Mr. Barry Barnum the billing policy has been amended with the parameters being clarified.
Motion
Board Member Rose made a motion to recommend to the City Council to approve amendment to the billing policy.
Second
The motion was seconded by Board Member Shakespeare
Vote:
All voted aye, motion carried.
New business:
The APPA National Conference will be held June 21-25 in New Orleans.
Phillip Solomon and Ross Hurst will be attending.
Motion
Chairman Ross Hurst made a motion to adjourn the meeting.
Second
The motion was seconded by Board Member Rose
Vote:
All voted aye, motion carried.
Calendar:
Next meeting: July 9, 2008 at 3:00 pm
Minutes recorded by:
Becky L. Rivera, Administrative Professional |
|
|
|
Sunbrook |
SG. Golf Club
Red Hills |
Southgate
Junior Assoc. of Golf
Weather Information
|
|
