Longmont City Council – Study Session – August 16, 2022

Video Description:
Longmont City Council – Study Session – August 16, 2022

Note: The following is the output of transcribing from a video recording. Although the transcription, which was done with software, is largely accurate, in some cases it is incomplete or inaccurate due to inaudible passages or [software] transcription errors. It is posted as an aid to understanding the proceedings at the meeting, but should not be treated as an authoritative record.

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Unknown Speaker 0:00
what’s now called the 2022 Long Island City Council study session to order it to order. Remember that this meeting can be viewed on the livestream at www Longmont. colorado.gov also at the city’s YouTube YouTube channel. WW Longmont public media.org. UK. We have a roll call please. Mayor Beck, present councilmember Duggal fairing Here. Councilmember Martin here. Mayor Pro Tem Rodriguez, Councilmember waters, Councilmember Yarborough. Mary have a quorum. Thank you. Let’s stand for the Pledge please.

Unknown Speaker 0:45
I pledge allegiance to the flag of the United States of America and to the republic for which it stands, one nation, under God, indivisible, with liberty, justice for all.

Unknown Speaker 1:06
We usually have the city manager’s report, but assistant city managers, are you going to give one tonight or no reports tonight on your cards? Thank you. So as a message to the public, Anyone wishing to speak at public invited to be heard will need to add his or her name to the list outside council chambers. Only those on the list will be invited to speak. Do we have any council members that have motions to direct city manager to put things on future agendas? So we do have a couple of presentations about let’s do the public invited to be heard first. The first person on the list is Margaret worth. Can you please come up? You have three minutes and state your name and address please?

Unknown Speaker 2:06
Good evening, city council. I’m Margaret Werth. I live at 2305 Bobwhite lane. And I wanted to just make a quick comment on the lack of diversity of public waste receptacles on Main Street specifically. It’s an area that my friends and I frequent. It’s a great spot to get a snack, get a drink, hang out, you know, support local businesses as well. But last time I was there, I noticed that most of the receptacles there are just trash. I only noticed one recycling bin and took me a while to find it. And I noticed a very unfortunate lack of compost, which I think is sad. Sustainability is one of my biggest focuses. It’s something that’s very important to me. And I would love to see that be more present in Longmont and the downtown area. Another comment I’d like to add is the new sweet cow that was just put in, I’ve noticed it’s brought a lot more people into the area. And the containers that the ice cream comes in are actually compostable, but then there’s nowhere to compost them. So I think that would be very important to have that downtown so people are just more aware of it and are more likely to compost and recycle instead of just throw things away, because that’s the easiest thing and there’s a receptacle right there. So I just wanted to bring that to the city’s attention. So thank you.

Unknown Speaker 3:33
Thank you, Margaret. Great comments. The next is Lance Whitaker.

Unknown Speaker 3:46
As you know I’ve been here before,

Unknown Speaker 3:48
would you mind stating your name and address please?

Unknown Speaker 3:51
Of course. My name is Lance Whitaker. 1750 Collier street online Colorado longtime residents, active libertarian voter. I’m in here in support of House Bill 191230. Section 744 12 408 subsection two a as you all know. And like to tell you guys today is National tele joke day. So I would encourage you all to tell each other a joke today. And I look forward to hopefully bringing you a Sunday comic lineup in my future endeavors. You hope people have a nice day, and I won’t bother you for any more time.

Unknown Speaker 4:53
Thank you Lance.

Unknown Speaker 4:54
You’re welcome.

Unknown Speaker 4:57
Seth Miller

Unknown Speaker 5:00
Hey guys, my name is Seth Miller, I live at 1025 Neon forest circle in prospect. And I’m also in addition to being a Longmont resident, I am the convener of a group called northern Colorado partners for clean energy. And on the eve of our visit from the our, our esteemed colleagues appear PA, I just wanted to talk for a moment and say that, you know, Biden today signed the inflation Reduction Act. And I’ll be honest, I’d be having the same message whether he did or not. But with the inflation Reduction Act, we have new tools to be able to accelerate the transition to renewable energy into clean energy, and to get the carbon out of our economy and moving our electricity to clean and renewable energy is absolutely important. But we can do things in Longmont in particular, in order to be able to clean up the economy further, we have new tools that will allow us to electrify vehicles, we have new tools that will allow us to accelerate the transition to electrical homes, we have the ability to be able to allow P RPA. To take market share from excels natural gas to take market share from Exxon and selling oil to be able to move the entire economy away from carbon. And so the question is, what can we do now that we weren’t able to do yesterday? In order to accelerate this? How do we accelerate new housing to be able to move to entirely electrical utilities? How do we move folks into electric vehicle? What should we be doing to add or not add solar to homes which I’m sure the folks at PRP have some sincere opinions on? We have these tools. And so what I would ask counsel is we’re listening and talking about renewable energy today, to just ask ourselves, what can we as Longmont do, to be able to make PRP a bigger to be able to take all of the other sources of energy and move it over to the ones that we know are going to be green? Thank you.

Unknown Speaker 7:06
Thank you, Seth. So that closes public invited to be heard unless there’s anyone in the chamber who would like to make a comment. Seeing none, we will close that public invited to be heard. Do we have any special reports or presentations done? Thank you. We are now in our study session items the app was the first one is the update from Platte River Power Authority. And I would like to ask David Hornbacher to please come.

Unknown Speaker 7:42
Hi, good evening. I’m just looking for the presentation here. There we go. Do we have it all up? All right, Don. Gray. Thank you. Good evening, Mayor Peck and members of city council. I’m Dave Hornbacher, the interim assistant city manager here. And tonight we’re going to have a study session chat, really about Platte River and about the resource planning update that they’re going to provide. So about Platte River. So just at a glance. Platte River was formed in 1973. It was really formed by the four owner member communities of Longmont, Loveland, Fort Collins in Estes Park. It was formed for the express purpose to deliver wholesale energy and trance transmission to these four communities. And so they have been doing that now for four decades. And it’s a it’s a large enterprise when you look at the 2022 budget of 280 million, so that represents you know, a quite a bit of electrical energy being dispersed amongst these four communities. And with Platte River, Platte River has an eight person board. And so on that board, there are four the members each are the mayor’s from the individual communities, and the other four members are as designated by their city councils and so on the so Mayor Peck is on the board as well as myself as a designated merit member from the city of Longmont. And so, you know, Platte River has been doing this for for many, many years, and I think still today they are the lowest wholesale transmission energy and transmission providers in the state of Colorado and what that means to our community as well as other communities is that lower cost energy really helps fuel our economy and helps provide opportunities for our citizens. In fact, the city of Longmont has the second lowest Municipal Electric rates, residential rates in the state of Colorado. And that is, you know, in part because of the cost of energy that we get to this community, the electric load is continuing to grow. You know, and and you know, even as you know, one of our inputs tonight was about growing that load and the benefits of that. And so yeah, the load is continuing to grow. And in fact, last year, you know, Platte River reached an all time peak of 707 megawatts, and right towards the end of July, so right now we’re seeing that as a summer peak, at the same time, the city of Longmont had our all time high on that same day too. So we sort of these four cities are sort of mirroring, obviously what Platte River is saying, and they resources that they are gathering applying to provide energy to this community. And so, and, you know, all of this is said so as they are transitioning to a renewable energy resources of which you’re going to hear more about tonight, and sort of where that is. And so just a little snapshot about the four owner communities. So you can see from this slide, that sort of cut out of the pie is really the city of Longmont, and so projected in year 2022, long months, electric load overall represents about 26% of the overall load that Platte River serves to these communities. And so with that short overview, I’d like to now turn it over to Jason Frisbee. Jason is the general manager, and CEO for Platte River Power Authority, and I’ll have him come up, and he can go over the agenda that they’re going to present. And he also has several staff members with. So with that, Jason.

Unknown Speaker 11:40
Right. Okay. How much time do we have tonight? I want to be respectful. 1520 minutes,

Unknown Speaker 11:47
share it as much time actually as you can to make this person. Yeah, there’s

Unknown Speaker 11:51
quite a few slides here. All thanks for the introduction, Dave. One thing I’ll reiterate what, what Dave said is, people ask me this all the time. And whenever I’m out speaking, I try to make a point of this. I think one of the most misunderstood things about flow river is that for cities formed us and that you own us. And for years at Platte River, we were kind of out of sight out of mind building resources, doing things cities, customers. And then about 10 years ago, city started getting asked questions you know, about generation and renewables and things like that. And so we’ve had to beef up communications marketing, we’ve got a whole new division at Platte River. So with me tonight is Raj Singh. musetti. Very pleased to have him on board. He’s a new chief transition and integration officer. He hates his title, I told him, I’d come up with a better one at a later date. But at least it describes what he’s doing. He’s got it. He’s got ot, he’s got all the modeling. He’s going, going to go into a little bit of detail detail tonight. And then Edie Gutierrez is our newest addition, Chief Strategy Officer, still in transition, getting the rest of his household here, but you’re going to be seen a lot more him from a communications and marketing perspective. So he’ll come up later on and kind of close out the presentation, I thought it’d be good to kind of ground everybody on how we got to where we’re at now. And then I’ll kind of turn it over to Raj and let him really kind of focus on how we’re going to make this transition. And then again, let Eddie finish. But when you all form, Platte River you gave us you all had federal hydro allocations from the government. And so that 90 megawatts of hydro was the summation of all four communities. And your peak load at that time was about 100 megawatts between the four years. So immediately, when the organization was formed, we were kind of under duress. We need to we need to go out we were buying in the market, we needed to start building resources. The government said, Hey, we’re not building any more dams. You guys are on your own, your cities are going to grow. And so the first thing we did was we went out and started building baseload resources because back man, not to get too technical, but the cities were all winter peaking utilities lot, a lot higher load factors, pretty steady load wasn’t a lot of air conditioning, like there is now so we didn’t see that. Really peaky loads that we see now, in the summer months. We are one of five owners of two of the three coal units over the Craig’s station. Unit One is scheduled to be shut down by the end of 25. Unit Two September 28. We built the right energy station, we own and operate that ourselves, and there’s additional gas up there too. But that coal unit, by the time we got to 1984, we had about twice the amount of energy that we needed to serve city load. And so a lot of those sales went to Xcel Energy. Those of you who’ve been around here for a long time might recall that there was a nuclear unit at 14 brain that just never could quite run. And so Excel was actually short resources. And so we we built raw high knowing we would grow into it and then had a 20 year contract. So every year, we reclaimed part of that contract and grew our way into between 1984 and 2004. Were the first utility. You were all the first utility in the states to provide when in the form of Medicine Bow six megawatts that still serves you today. We no longer own it. Those turbans got quite old and there were was an opportunity for an organization to come in and kind of refurbish those turbines, and we entered into a purchase power of being with them for fixed pricing for another 15 years, so that’s still in our portfolio. And then I alluded to this earlier, but when we got to the late 90s, early 2000s, a lot of air conditioning penetration, and we saw different kind of load than we’d never seen before. And it was peaking load. And so not to steal much of Rogers thunder, but the most economical way to meet peaking load is with gas turbines, because they’re relatively inexpensive assets to put in, but they’re relatively expensive to run. Fortunately, they don’t run that off, and they come on in the afternoon, they shut off in the evening. In fact, if you’re looking at the data that I look at, as a CEO, I looked this morning in preparation for coming down here, year to date, combined, they’ve run it a 3% capacity factor, and that’s extremely high. For our system. We’ve had other utilities in the region, our short to serve our own load, they run about 1% of the time.

Unknown Speaker 15:57
So we had our base load and we had our peaking resources, and then we started to add more renewable silver SES, which if you go to Cheyenne, take a left, go about five miles overstayed sites up there. 12 megawatts, most expensive renewable resource we have on our system was silver sage, then we added spring Canyon at about half the cost was kind of a theme here we were kind of dollar cost averaging our way into renewables as they were starting to come down. We were increasing the volume to keep, you know, the the rate pressure down. In 2016. We put we’ve got about 4500 acres up our rights were plenty of land. We put 30 megawatts of solar up there that spans over about 150 acres of our ground. That represents about one and a half percent of the community load. Dave alluded to your eight to 900,000 megawatt hours combined all four cities between 3.23 point 3 million megawatt hours. And that first slide, if you looked at it close, will supply about 5 million this year. So what’s the difference between those two that’s being sold into the surplus market. Because we don’t operate in a vacuum by ourselves. We’re interconnected with Black Hills, we’re interconnected with Colorado Springs Utilities, we’re interconnected with Xcel Energy, we’re in a client connected with tristate and so we’re all constantly managing power with each other. And when other units are off, we’re selling in power and vice versa. You’ll see in some slides later on where we actually make purchases. So we added Rawhide flats. And then something significant was a joint dispatch agreement, we got together with the Colorado utilities and thought, hey, you know, we’re trading power with each other anyway, why don’t we create our own little mini market, and everybody put in their cost model profile, and then whoever needs energy can get the next least cost resource. And so we’ve been involved in that it was, it was Colorado Springs, Platte River, Black Hills in Excel, tri state chose not to participate. And Colorado Springs has since pulled out, but the three of us and it’s served us very well, our average cost of energy last year was one cent a kilowatt. Now, I will tell you that we’re buying a lot of our energy in the middle of the night when there’s a lot of wind on the system, not two stars. And so rather than curtail that, or dump that or sell that at a loss, it’s getting dispatched to under joint dispatch between five and a half of Santa Ana Santa kilowatt, or I’d like to talk in dollars per megawatt hour. So $5 to $10 a megawatt hour. That’s significant because we buy quite a bit of energy there. And it enables us to either save fuel cost on a resource, or saves us from starting another resource if we can bridge that gap. And you’ll see a theme in that when Ross talks about the intermittency of renewables and how we’re going to manage that in 2018. I’d been the CEO for a couple of years, and we’d been talking to the board. And we all felt like it was important because boards change mayors mayor’s turnover, utility directors turnover, we were in a significant transition as an organization. And so the board really wanted to lay the foundation for future boards to understand why we taken a major shift in direction. And they did that in the form of resource diversification policy. And we’ll get into that here in a little bit. But basically what it said was, Jason, you as the CEO, proactively work towards a non carbon energy future without sacrificing the three pillars of this organization that have served it well. Reliability, affordability, and environmental sustainability. We want you to maintain those things in no way shape or form, sacrifice those now. I’m the first one to tell you that we do a pretty good job of defining reliability. Affordability, I think is a collaborative effort between us and the owner communities. We’re talking about rates a little bit tonight. And I think decarbonizing our resource portfolio speaks volumes to the commitment to environmental responsibility. So, that was passed at the end of 2018. The next big resource the most significant everything else that I’ve talked about to date pales in comparison, but we added 225 megawatts of wind. About 15 miles north arrived just over the Wyoming border. Just that one resource conserve the whole Poun of Longmont for a year now. Not when you need the energy, but in aggregate it produces about 900,000 megawatt hours of wind energy, it runs at about 43 44% capacity factor. But thanks spring, fall night, that’s when you get more your wind penetration, we would like it to be on hot sunny days. But that’s typically not how it occurs. But that was a large part 28% of total community load with that project, we actually, the original project was contemplated at 150 megawatts, and we were able to resell some other wind that we had at cost to make room for this lower cost when it’s less than two cents a kilowatt and get it on our system. While prices were really low, we’ll talk a little bit about what’s taking place in the market as things started to go against us. And hopefully, they’re going to start coming back with previous speaker inflation Reduction Act, I think there’s some good things that we’re looking forward to to help the price of renewables, we added another two to 22 megawatts of solar up at ride. This time, we put a two megawatt battery with it, we talked to the board, hey, we want to get used to charging and discharging his batteries here how it works on our system before we go out and buy 1020 30 megawatts. In general, a batteries about a million dollars a megawatt in general, prices are starting to come down. But that’s about what it is. So that gives you two megawatts over 24 hours. You know, for a million dollars, you purchase PPA contract for that commodity, then we went into we are entering into I say then next spring, we’re going to move into the Southwest Power Pool, which is going to be critical for us the energy imbalance service market. So that’ll be the next step from join dispatch, where we’re trading on like a 14th, street region region with other folks. So broader geographic footprint, better opportunity to market renewables and purchase renewables. Through that contractual arrangement. We ultimately think by 24 or five will be in a full blown market. That’s what’s represented enter into the Southwest RTO West kind of a fancy word, but that would be full, organized market, which rods we’ll talk about in a little bit. We’ve been delayed our black holo solar, which will be our largest solar project to date, we had a written contract on that, and the pandemic hit, then inflation started to hit. And the counterparty walked in and basically said, hey, we’d rather pay you liquidated damages and honor this contract, because if we do, we’re gonna lose $100 million. We said, okay, we’d been out in the market for refreshed RFP prices. We said, refresh your RFP, because we really don’t want the liquidated damages. We want the non-carbon energy, give us a price. And still we’re still working through reconciling that with them. But I will tell you, this is a theme. It’s not all good news up here tonight, from a cost perspective, from that original contract that was confidential, their price to us more than doubled. That’s how significant it was. And we’re talking about liquidated damages well in excess of $10 million, if they’d rather just cut us a check and walk away from their losses, like, whoa, we’ve done a lot of work. We’ve got permitting, we’ve got a site, you know, we’ve got to design for a substation, the interconnect on our system, let’s not walk away from it, let’s see if we can come up with a deal that works for both parties. So we’re still working through that. They’ve indicated to us a price that we’re willing to accept, but we’re still the contract is I have not signed it yet. Because there’s still some back and forth between the attorneys to make sure that we get everything locked down, because we don’t want this to happen to us again, because time isn’t really our friend, as we’re trying to make this transition and you’re ready. cost us a year with this whole thing. Now, you know, in a little bit of their defense, I don’t think anybody contemplated what was going to happen as a result of, you know, the pandemic. And, you know, nobody predicted inflation like this and tariffs that have since been reconciled. But I can I can tell you stories of solar panels that were stuck on ships that people weren’t wanting to deliver into ports, because they didn’t know what they were gonna get charged for them from a tariff perspective, a lot of those things have since been reconciled. So that takes us through 2025. If you take a step back and say, Where are we now from a system perspective, you see the pie chart on the left, from a budget perspective that Dave told you we had a $280 million budget this year? If we’re right, and we’re never right 100% on our budget or resource performance, what we’re usually not too far off, we projected that 36.3% of the resources to serve all of this not just your cities, but all 5 million megawatt hours was going to come from non-carbon energy so far year to date. It’s at 40%. I don’t know what radio stations people listen to or where they get their news from one of the windiest years on record one of the sunniest years on record, one of the hottest years on record, been very good. We have overproduced almost every month through halfway through the year on renewable energy so you can see it reflected in the chart about one Almost 25% wind up there. And you can see solar production, although it looks very small is going to grow quite a bit as we get some of these bigger projects, compare and contrast that to 2030, our projected system total of about 88.4%, you could plus or minus a few percent on that, because the way we incrementally add renewables is we’re going to take advantage based upon price, we may add more or less in the next project, but Raj will come up here and tell you that we need to add three 400 megawatts of solar about 300 400 More megawatts of wind, and a couple 100 megawatts of battery storage, and some additional dispatchable resources to manage all that with. So that’s what that chart represents. I think it’s important as a counselor that you understand, we’re setting here in 2022. And I’m trying to tell you what it’s going to be in 2031, I just got done telling you how crazy this whole world has been over the last two years. So me predicting what prices are going to be going forward. You know, when we’re going to get permits, we would have probably the thing that we missed the most was the opposition against us to try to get a lot of these projects permitted. We were stunned at the pushback that we got from county commissioners not wanting them in their counties. And so, so much so that this most recent project, a town went and annex the property so that the project could go forward and put it under their own authority, because they’re like, Hey, we’re fine with it here. I think it’ll be a good benefit, tax benefit for our citizens. But that’s the kind of stuff we’re up against a year goes by having discussions with commissioners are ultimately going to go, we’re not going to support it. And that’s not just us, that’s happening all over. All over. It’s it’s been, it’s something that we, we incorrectly thought well, gee, you know, this will be a perfect complement to some other things that are already going on in the county and give you more diversified source of revenue. But we were wrong about that.

Unknown Speaker 26:55
The diversification policy, I’ve referenced a little bit I’m almost done. And I’ll turn it over to Raj. And the purpose was to provide guidance for resource planning, portfolio diversification and carbon reduction. I won’t read the goal to you and I know I said it pretty close button, not word for word, but the points are up there. The important point on the right side of the slide, he knows a lot of words on there. So the first part, the first bullet, we got a checkmark by we are moving into a market. That’s not a question it’s going to happen. We’re going in the imbalance market. And just so you know what, okay, Jason, what does that mean, your senator telling you moving in the market, millions of dollars of infrastructure, computers, software, staffing, data scientists, it’s a whole new area that we’ve never been in before, at Platte River. And so we’re really ramping up in preparation, because it’s a much more transactional utility, think of it kind of like a stock market and you not wanting to be on the wrong side of a transaction, because you can lose millions of dollars very quickly. If you’re not competent. You don’t have the right data to make good business decisions. Everything that’s in yellow up there, Raj is really going to speak to but these were all caveats that the board contemplated, were going to be challenges for us as we made this transition. And so you can see things about there needs to be continued investment in transmission and distribution, infrastructure distribution being on your side of the system transmission being on our side of the system, we take it to the substation, Dave and Darrell take it from there down to businesses and homes, that those those that has to be there has to be new communication structure, there has to be two way communication. There’s a lot of stuff in there, the Ross can speak to you better than I can. And then finally in blue battery storage, and we’re cautiously optimistic. I don’t think battery storage cost and technology have advanced as much as people thought they were a couple of years ago. There’s been some setbacks with some fires on some large lithium ion batteries out west, things like that. But what we’re starting to look at is there’s a lot of promise out there with some startup companies on long duration storage. That’s a much safer technology. Really, basically all you need is land and water to make these batteries work. And we’re a traditional lithium ion battery, you can discharge for two hours or four hours. There are startups out there doing 10 hour discharge, and there’s others. Raj and I went out and visit Cal Berkeley 100 Our discharge battery game changer for us, if we can, because the lithium ion batteries just gonna shift load throughout a day. We get a snowstorm, no son, for four or five days over the course of winter. We’ve got to serve your load from somewhere. If we’re not getting it from renewables, we have to have storage, already charged and ready to deploy over that period of time. We do model run after Malarone after model run to make sure that the reliability that you’ve enjoyed for 49 years next year is our 50th celebration at Platte River, that that’s not being sacrificed as we move forward. So Roger and we’ll get into a little bit more about that. When he talks, let me talk a little bit, because I don’t want to lay this off on my staff. I’m your CEO, I’m accountable. We’ve talked to the board, our recommendation is a 5% rate increase back in 2020. When we did high level estimates of what it would cost between now and 2030. To make this transition, we estimated to be 3.2% a year. I can tell you since that time, I can’t think of much that’s gone our way. Inflation has gone up, commodity costs have gone up, labor costs have gone up. Yesterday, things started to go our way. But back then we were criticized for the price that we were estimating we were going to pay for wind and solar in the future. Turned out that those estimates back in 2020, were 50% Too low based upon what we’re seeing now. Now, we’re hopeful we’ve asked all of our vendors that we have bids from, they say give us two weeks we’ll refresh the bids is a reduction in the reflation inflation reduction outcome and to let us run that through our models. And so we’re gonna know within the next two weeks, what it means to the price of our next solar project, we’re going to know what it means to the price of our next wind project. And I think one of the most significant things that may get missed by people that aren’t in the businesses, for the first time ever, we’re going to be able to charge a battery from any source, and it’s still going to be able to take advantage of a tax credit. That was something that I’ve argued against for six or seven years, why does it have to be limited to be charged by solar? Why does it have to be limited to be charged, if you really want advancement of renewables, let us use it to manage the entire system. And so, folks in Washington agreed that’s also in there. So that’s a game changer for us, that’s going to put us on a level playing field as we go to procure storage. But what you’re looking at up here, there are five categories. If you take the four on the right.

Unknown Speaker 31:52
And trust me, because I’m good at math, they kind of wash each other out. You’ve got operations and maintenance costs. Right now, this year’s budget, the total $80 million budget, and our projected 2032 budget. Why 2032 And RDPs, only 20. We always take a 10 year look in our strategic financial planning budgets award has given the board a 10 year look ahead. So that’s the only reason it’s 2032 snapshot right now actual projection for 2032. What’s the difference? You see oh nm go down a little bit. You see AMG costs go up, more software, more hardware, more staff, you see the ER, spending go up, no surprise, and then other, there’s a lot of portions of that debt, capital, things like that in there. But they wash each other out. And what’s driving the rate is a little over $100 million of cost right now, for all the energy that we delivered your system and sell into the market, our projection for that same energy 10 years from now doubles. And we’re accelerating at putting in those resources. And so in order to grow into that rate, right, what we thought was three to is now five for the next several years, we’re hopeful that maybe it will come down. But at least we have gotten a commitment from the board, because Dave and his team and the other cities need to put together their own budgets for you to approve. And in order to do that, they got to know what their wholesale cost is from us. And so we’ve agreed to live with five, we do modeling every couple of months. There’s always portions of that that are changing. But we feel very fairly confident with that recommendation. It’s on their slide, the original, it started around 6.8. But we have looked at some ways that we can drop that back down to five. And we’re going to we’ll need a vote from the board, Platte River Board to approve a revenue deferral policy. I don’t want to take any money through the boring accounting world, but we’re going to defer expenses and revenues. Because as we grow into that rate, we project to have some fairly good years here over the next couple of years, until some significant expenditures come up. So we’ll take some of those gains right now. And then we will show those on the books in future years when we have rate pressure. It’s a common practice in an industry like ours where we don’t add costs incrementally every year on an equal basis, we tend to have one big expanse and then live with it for five, six years as the city grows into the next resource. And so accounting worlds recognize the ability to do that. The average wholesale rate this is blended, it depends on you know your peak for the year and everything else but from a budget perspective, this year $64.63 A megawatt hour or 6.463 cents a kilowatt, however you want to say it going to 67.86 that shows the 5% change. For you turn it over to Raj. I went through a lot of stuff, try to go quick. There’s a lot of information out there. Some of you are going to sit down for the love of God let the other guy talk but I wanted to make sure that I got you kind of framed as to how we got to where we are now. Things haven’t really gone our way. We’re still moving forward, we’re still committed to doing everything we can to reach our goals. But it’s not any easier. It’s it hasn’t gotten any easier. But hopefully, we’re gonna see a little bit of relief in the form of PPA pricing here over the next couple of weeks.

Unknown Speaker 35:20
Thank you, Jason, do we have any comments from councillors? Councillor waters?

Tim Waters 35:30
Thanks, Mayor peg, it’s really not a question. It’s just maybe to reinforce that last slide that we should be anticipating, as show our rate or customers in Longmont a 40% increase over a 10 year period of time. Yeah, I mean, listen, I’m trying to project everything I got. I got a whole bunch of variables. Yeah. Kind of like from the last 10 years. Yes. Things You Didn’t Know. In the in the context of a bunch of unknowns? Yeah, future pandemics supply chain for labor costs, correct, you know, tariffs or whatever. Today, the projection is a 40% increase. And I just think I think, you know, what we will hear every, you know, we’re gonna get, as we go through budgets fell here from David, and you know, what our, whether it’s the 5%, or 5%, plus or minus in 2023, we’re gonna get feedback from our residents. And we’ll hear in terms of, in spite of what are, what the cost is, in comparison to other municipalities, people will tell us Yeah, but I don’t live in that municipality I live here. I just think we people need to be, I understand, when there’s a cost that’s gone up, it’s because of the cost of the wholesale cost in the production of that energy requires acts that gets translated to to ratepayers like us, right, that are building a budget and have to make certain we keep our supplier in business. And that’s going to be on the backs of everybody in the community.

Unknown Speaker 37:01
Correct. A couple of things, I would just say, I think you make a great point, in general rule of thumb, that 40% that you see, we’re about two thirds of your cost, right? So if you did the math on that, you’re gonna see straight through from from Wholesale to retail, that’ll impact you about 31% or so. Right? That doesn’t mean that they even Darryl and his team don’t have AMI other things that they need to put into infrastructure on their side as well. But in general, it’s a little bit different in every city. It’s a little bit less in Estes, because there are winter peaking utility, but the front rains utilities for cones, Longmont, Loveland, we’re about two thirds of the total cost. And thanks, yeah. And then one more thing, since you brought it up. I also think it’s important to know this only stops at 10 years, when we kind of grow into this resource portfolio, what we project going forward is very little rate pressure at this point in time, because you’ve added all the resources on your fixed PPA agreements, right? To the extent I’m a good manager, and I put together a good team, we manage other controllable cost. This is two things. It’s putting them in quicker than plan and cost going against us while we do it. So to get through that period of time, we’ve got to accelerate and grow into that. But once we get through it, we actually project it. Let’s say we did none of this. We run scenarios, let’s say we never did any of this. We just kept running coal plants. And, you know, we added things when they were financially advantageous. We projected that by 2040, we’d be at the same place difference is with this plan, no carbon. Right. So Eddie and his team are going to work with your staff and talk about, okay, full transparency, we’re asking you to pay for more. What are you getting for that? Right, because I think there’s a great story to tell as to why we’re making this transition, why it should matter to people and what they’re paying for. Counseling.

Unknown Speaker 39:11
Thank you, Mayor Peck. Just in terms of of the history, can you describe the role of the four cities in driving the resource diversification policy to be adopted?

Unknown Speaker 39:26
I think that I’m not sure where you’re going with it. Councillor Martin, but I think that for cities that own Platte River all had kind of different opinions on where the organization should go. And probably 1012 years ago there were a lot of discussions about well maybe play river should start building customized portfolios to match each owner community. It was about that time then it came in he said well, oh wait, timeout like you formed this organization to take advantage of economies of scale you have for for owners, that requires compromise. Let’s talk about where the cities want to grow together, right and what their goals are combined. And that really led to 1415 really earnest conversations about, hey, let’s try to decarbonize this portfolio. Ultimately, it was memorialized in 2018. But I think, I mean, look, we’re here We exist to provide value to their own communities, and communities. So they want to decarbonize, it’s our job to figure out a way to do it. So my easy answer to your question is, we wouldn’t be here without the four cities driving this organization to carry out this mission.

Unknown Speaker 40:33
So you don’t think that the that the 2030 goals adopted by all four cities in 2018, slash 19. had much to do with it. You think you’d have been there anyway?

Unknown Speaker 40:45
No, I said the exact opposite. Okay. Yeah, I said, but for the four cities changing course. Ah, I see. Yeah. We wouldn’t be going down this road. Okay. I don’t believe no, because I think up until then, might, I think, you know, the best evidence as I can offer is, I don’t think anybody has been a more polite river board meetings than me by proxy of my job. I’ve been in senior manager there for a long time, probably 24 years. First, 15, are those low cost reliability? It’s all we care about. And I’m not minimizing that but low cost reliability. There are customers let us deal with them. We don’t care what resources you have just keep the cost low. This is completely different than that.

Unknown Speaker 41:26
Okay, thank you. Yep.

Unknown Speaker 41:29
I was just going to add to it because some of these questions also transpired directly to the city of Longmont to LPC and so I’ll touch on councilmember Martens, too. So, you know, Councilmember Martin, I appreciate what you pulled forward and some of the information that you actually had in your council packet, document documented, really the many steps that this council in previous councils have taken that have rolled into the diversification policy, including the 100% renewable goal by 2030. And then we’ve also had the Climate Action Task Force and a lot of other things that are have happened and are currently happening in the we’re going to talk about beneficial electrification here in the coming month. Also, there’s a lot of things being driven at this council seat that that work here at home, as well as broader at Platte River. And then also, Councilmember waters to your question about that. So we were based on Platte rivers previous estimates, we were anticipating a 3.2%, approximate average. So this would be an increase from what was earlier projected. And I think as as Jason was alluding to, and you’ll see in the rest of that it’s being driven by you’re essentially rebuilding a complete electric system, you know, training, changing from what you currently use for assets to generate energy to much different and we’re accelerating that. So a lot of these assets are online earlier, so that you have a time to operate them and make sure they all work. But since some of these things were sort of in the LPC wheelhouse, I just wanted to add that part to it.

Unknown Speaker 43:10
Thank you. You’re a counselor waters.

Tim Waters 43:14
Thanks, Mayor Beck. And thanks, David. As I’m listening, and I should have probably asked this question to Jason when he was at the mic, and maybe and maybe we get this from from from the next two speakers. But to circle back to what we’ve heard from Seth, and I’m certain there’s a ton of detail that’s yet to be learned about the bill that was signed yesterday, or I guess today by the President. In where that might were that might show up in in either different costs or covering costs or, or has that all been factored into what these what these projections are? How will how will the four cities in the ratepayers benefit, potentially or the utility be able to capitalize on that 300 billion $370 billion? It’s going to be available?

Unknown Speaker 44:06
Yeah, so to your first question, and I’ll let Dave answer the second one. Nothing from the inflation and Reduction Act has, in this information, what I alluded to earlier, as we have two projects slated right to move forward to different solar projects. So we’ve asked the finalists to go back as a result of this being signed. So we’ll know exactly. Their view on what kind of relief this gives, at least as it relates to Wholesale Solar prices and storage prices and what

Tim Waters 44:37
there’s some of that potentially show up in your in your estimate to your forecasting or or have you already baked that in?

Unknown Speaker 44:45
We did not assume that that would happen going forward.

Tim Waters 44:48
So that might show something might change. That’s what I was doing. We

Unknown Speaker 44:51
may get some relief in subsequent years depending upon how it plays out. Yeah.

Tim Waters 44:55
And David it

Unknown Speaker 44:58
you know, I don’t have anything real specific other than it is a game changer. Yeah. Because it it provides some more flexibility, eliminate some barriers. And and frankly, in some ways being missa palette and having an organization that works for missa palette, it meant that there were certain things not available to us that were available to the private sector. And so I think this will change quite a bit, and we’ll see the, you know, we’ll see it for the next several years. Thanks.

Unknown Speaker 45:27
So I did have a quick note. That’s okay, Raj. Jason, did you want to make a comment?

Unknown Speaker 45:34
Oh, no. Okay, trying to figure out what to get out here.

Unknown Speaker 45:38
So, in the next presentation, or perhaps you someone will cover it, I want to know, as the cities start selling their own power generated from renewable energy, how does that work? Since you’re going out to the market now buying renewable energy and project to do that in the future? How does it work when individuals cities are producing their own energy and selling it to PRP?

Unknown Speaker 46:08
So if it’s alright, with you, bear pack, when we circle back to that question, as Raj has made his the rest of the presentations because you’ll give us more foundation to talk off

Unknown Speaker 46:20
of okay, that’d be great. Thank you. Thank you.

Unknown Speaker 46:24
Raj, you’ve been introduced five times.

Unknown Speaker 46:26
Yeah. And it’s always tough to follow someone who’s really tall. Okay. So we Jason talked about a lot of uncertainties and cost is not known what’s the future going to look like. But one of the engineering principles is planning. We plan everything. engineers know everything. And that’s part of what this integrated resource planning is. We try to plan everything. And we work with the city staff in developing a plan, a plan that is the future. And it’s based on the three pillars that Jason mentioned, reliability, affordability, and environmental sustainable. And this is also to make sure the board approved resource diversification plan is implemented as part of this integrated resource plan. So IRP is like a blueprint that we create. And once we have the blueprint, it is not something that we start working on it, it’s a continuous process. And the next IRP is going to happen in 2024, it’s going to go through the same process where the city staff is going to work with the Platte River, the community stakeholder meetings are going to be conducted, the feedback is taken. And all that is put into a model and an integrated resource plan. We run through tons of scenarios, we do reliability studies, we also look at what our future looks like. And we look at costs, all that is made through it is a long process, just the model runs takes about two, three days to just run. And then in the middle, if it fails, we have to go back and run it again. So it’s a long process. But why do we do this? IRP is a strategic plan for the future. We it’s guiding post, we look at the plan, we go with it. We also need that for the clean energy plan, how do the how is the Clean Energy Plan matching with how we are adding resources to the portfolio. And finally, when it all started integrated resource planning was a requirement by the Western Area Power Administration. They wanted to understand what’s our Lord, what kind of resources we are gathering so that they can do the hydro allocation. That was kind of the basis for all this high Integrated Resource Plan. It has obviously evolved into something new now, which is the guiding principle for the new resources that we are adding a specifically new resource meaning the clean energy resources that we are adding to the portfolio. So we did the last IRP in 2020. And then we refer to this thing called RP 22. And again, engineers like code words, or pod two is nothing but a refresh to the Integrated Resource Plan of 2020. With the new facts, facts, meaning, we said how can everything come online on January 1 2030? Obviously, the models do what’s good, good at it’s saying, Oh, the costs are going to be least if we push everything to the end. And then once that happens, obviously the model said turn it on in January 1 2030. But then we said that is not realistic. So we let that resource plan 2022 And we accelerated the renewable integration. The blue line that you see is that accelerated we are bringing on renewable resources sooner than we had planned in our initial Plan. And that is what, what really what does that do is we are able to actually reduce the carbon emission 5.5%, more than what we had initially planned. Also, we are also going to see all this integration going to happen by 2028. By January 1 2028, all these renewable resources are going to be in the portfolio. This gives us that two years to actually work with our renewable resources, work with our existing dispatchable resources. It is another engineering thing where, you know, we plan for everything, but there can always be something that we missed, this will give us that planning requirement to do two years of managing the portfolio.

Unknown Speaker 50:43
And then, one key thing that is happening, we have all heard the are shutting down the coal plant by 2030. And today that coal plant produces about 2.4 million megawatt hours. And that translates to three different colors. The green is solar, which is about 999 megawatts, 1000 megawatt hours. And what that is, is about 41%, of that resource is being replaced with solar 44% is being replaced with wind, and the blue line that’s there. Now, when you add this green bar and blue bar, which is intermittent, and is a function of the weather, we need something to manage the system reliability. And that dispatch ability is coming from that blue that’s on the top, the idea of that dispatchable resources is to maintain the system reliability. And the question that you would say is, we talked about storage, how come storage is not replacing, the reason storage is not showing up in the bar chart stacked bar chart is because storage is not really producing energy, it is just shifting the time, you charge one hour, and then you discharge another hour. So it’s not really producing new energy, but shifting the time, which is very important, which is adds more control dispatch ability to the system. So the whole we are going from 2.4 gigawatt hours to just 357 gigawatt hours of dispatchable resources in the new plan. Again, I’m sorry, it’s 2412 gigawatt hours. Now, this is a chart from a recent past August 6, it is a chart looks like wiggly chart. But the idea here is to show a few things. The black line is the demand the Platte River served on August 6, throughout the day, it goes up down and then comes back to normal, it’s kind of the shape, or we serve the load. And if you look at the resources, the bottom is the hydro that we get from hydro allocation that’s at the bottom. And then the green is the wind, if you can see the when it is coming in the morning. And then when we really need in the afternoon, it’s not there. And then again in the evening, it picks up so there is this what is called a variability in that renewable resources. And then on top of the green is that yellow, which is the solar that comes during sun. And that’s and when sun’s gone, you lose it. And on that particular day, we even lost sun, solar energy around 3pm. The blue thing that you see is all the coal resources. And today we are going to talk about how are we going to replace all that blue coal, with the clean energy, the green has to go up, the yellow has to go up. And the red which is there, which has today supported the grid from dispatch ability when solar dropped, wind dropped, we were able to use the dispatchable resources that were in the system to provide energy and maintain the requirement of load. So that’s what’s happening. And you can say, okay, Roger, how why don’t we replace blue with one color, let’s say when but the thing is, even if we were to quadruple how much when during that morning, we still would need some more energy. So this brings the concept of fourths portfolio fit. One resource cannot solve all our problems. One, one color cannot replace all one blue color. So it’s a combination of wind solar storage dispatchable capacity that is needed to maintain and support the grid and Main and serve the load. So I’m going to go this is like

Unknown Speaker 54:48
I would say at the high level how the grid is served of Platte River looks at serving the load. Now if I translate this to a house, and I didn’t pick everything that’s how Also, it’s a small house, where we have led, refrigerator and AC. And there is a residential solar in it. And if you look at the shape, the refrigerator is running all 24 hours, and in the morning, but as soon as we get up, we turn on the LED lamps, which is the blue triangle in the morning. And then as the day goes, we turn on the AC, the AC load picks up. And then in the evening, when we come back, we crank up the AC again. And we also turn on the LEDs. Now, if you look at the shape of your solar energy, it is a perfect shape, which is between six and evening. Seven. But that shape really doesn’t match with the energy demand of your house, meaning in the morning, it’s not available, it’s not available in the evening. And throughout the day, when it’s available, you don’t have as much load, meaning you, you produce more than what you need. So that is a good example. But what how would you solve this, the one way to solve is to shift the hours with storage, that would be a logical way to do it. And I agree with that. So the next slide, I’ve got, you have solar, plus the storage, you were able to charge your solar with the storage. So this is charged the storage with the solar energy, and you discharge the storage when you need it in the morning and in the evening. But the key is, even in the evening, which we could refer to evening peak or evening ramp, you did not have enough storage to cover your load, you’re still dependent on your local utility to provide you the energy that you need. And then throughout the day, when you’re producing more solar energy, you can the dark orange line actually represents the solar energy can be used to charge your battery. So given all that, you can say Roger Hawai, can we resize it, we can make it Yes. The it’s all coming down to the costs? What is the right sizing? What is the reliability needed? What does the utility have to do to support you when you are pushing energy to the grid, as well as consuming energy from the grid, this is a way it is not energy efficiency, it is not where the load is lost, the load is still there load meaning the demand for the electricity is still there. Your residential solar has to match what we need, as well as what that really translates is we need the data from the customers, the data needs to come to us so that we can account for that information and make a good planning, call load forecasting, and make sure that enough resources are available to support that. So that is the idea of combination of solar and storage.

Unknown Speaker 57:58
So the next thing, again, I’m trying to say, Yeah, we have the storage, we have the solar great, that can solve the problem. But we live the northern Colorado, we also get snow, we have what’s called Dark calm where there are days when we don’t have solar energy, when we don’t have solar energy for five days. How do you charge your battery. So we kind of do did similar some simulations on dark calm in our resource planning, we looked at what would it take if we were to completely rely on battery and solar to serve your load. So with day one, it’s great three, we started with three batteries, we said we can serve it great. But by midnight, we have two batteries that we couldn’t charge anymore. And the next day, we had to bring on another two batteries to serve from midnight to the morning. So by day two, we needed about five batteries to serve the Lord. And then the bigger problem if there is a dark calm, meaning we don’t have sun for a couple of days, five days to be precise. We have an issue, we have a long we have reliability issue that we have to manage. Again, these are some of the problems that we are as an engineering problems we are trying to deal to make sure we have the right kind of resources to support the grid. And then we had like Jason said, we went to Berkeley looked at long duration storage technology, which is 100 hours of discharge. We’re looking at 16 hours of storage. We’re looking at all possible combinations that can support these problems. So it is we like solar, we like carbon free energy, but we have to make sure reliability is maintained so that our customers get electricity all the time. So those are some of the challenges that we’re dealing and we’re trying to solve the problems with industry and we’re constantly looking at new solutions for that. Now coming to To the resource diversification plan a timeline. The big thing that’s happening from 2024 to 2028 is 2020. Forward, we will have a new integrated resource plan which is 2024. And we are going to be adding 300 megawatts of solar in the grid platter which is going to have 300 megawatts. So what that translates to is about approximately 50,000 residential homes on behalf of 50,000 residential homes, you have 300 megawatts of solar, we’re going to add 200 megawatts wind on behalf of 30,000 homes, different time of the day, it’s not adding, but it is available different time of the day. And then we are adding 200 megawatts of energy storage to maintain the dispatch ability needs of the system, we are also adding another 166 megawatts of reciprocating engines which are Quickstart. What really the problem that we are trying to solve? Previously, Jason talked about peak load, and then load when it suddenly spiked, we turned on the peakers. But we are new problem, we have flexible generation, we have flexible demand, flexible generation, meaning variable, generation and demand which is flexible, we could have electric vehicles, we talked about inflation Reduction Act, great for electric vehicles electric load. So we start seeing this flexibility in the system. And to support that we need to have what is called dispatch ability. And top of that, we are also going to be building 100 megawatt virtual power plant, you may say what’s a virtual power plant, we’ll talk about that. But the idea is the virtual power plant, the future of energy, electricity industry, all the consumers in future are going to be the producers as well. So they’re prosumers. So we have to talk about how they use the residential solar distribution generation, beneficial electric load, and even electric vehicles, again, data, all that needs to come in to develop that virtual power plant. And we are going to build 100 megawatt virtual power plant by 2028. That’s our target. So at the bottom, you see the retirements that Jason already talked about. And the big thing is, by 2030, we’re going to get back our 60 megawatts of the wind resource that we you know, sent out of the system, and the raw is going to retire by 2030.

Unknown Speaker 1:02:25
Before I talk about virtual power plant, Jason talked about organized market. It’s very important to understand Jason did mentioned stock market risk and the volatility in the market, organized market for electricity market specifically also referred as independent system operator or regional transmission operator ISOs and RTOs. ISO sonatinas, Platte River will become a market participant of an ISO RTO. It is what does an ISO to do, it allows economic dispatch of all the resources that are in that market. The power markets will allow all the utilities to bring show up all their load that they have the demand that they have, and also are required to show the capacity that they have to carry. And once an ISO a market, ISO is a big software to begin with, they run these economic dispatch models to make sure the load is served at the least cost. Their objective is to serve the load at a minimum cost. And that’s what’s happening. It also allows us to monetize the virtual power plant a virtual power plant that will be built based on the information and the data that is given to Platte River by the cities and the customers of those cities. And all this comes with a challenge to some talked about volatility risk, cost of integration, because these requires systems infrastructure and integration with the markets integration with the cities and the AMI data to actually develop and monetize virtual power plants in these markets. On Jason also covered that we are joining an imbalance market next year and we will be joining a full fledged day to RTO market in 2020 fi so imbalanced market is on a high level, you know whenever you are short or less energy, you can go to the market and pick that up. And in a day two market which is a full fledged market in the day ahead. You tell the market, what is your demand overload? And you also tell them what resources do you have in the market takes all the participants of that market and identifies the least cost to serve your load that’s happening, but the key is all load serving entities have to come to the market with capacity. You cannot just go to the market saying that I’m just going to buy You’ll have to come there with resources that are required to serve the Lord. This is actually probably was very happy slide because President Biden signed the bill, because this will be actually accelerated with that inflation Reduction Act. Because everything that you see there, there is lot with building electrification, heat pumps, electric vehicles is another piece, all that information, distributed generation, investment tax credit, production tax credit for other smaller utilities as well. And the demand response linked to energy efficiency, if you looked at that words will power plant and power plants typically need fuel, this virtual power plant, the fuel for this data, data is the one that fuels this power plant, you tell what is needed, what is available, and we take that information and identify what is available by each city. And then we take that information and offer that information to the market. So there are two levels. First City has control of all these distributed generation electrification information. And then whatever access is available, we can take that and go to the market and monetize it. So the customers ultimately benefit from forming the virtual power plant, and taking advantage of what’s needed in the market. If some other participant in the grid needs it, your virtual power plant can also support that. So that’s the whole idea.

Unknown Speaker 1:06:42
And finally, I talked about all these things that are happening, these are great. So the two things, and Jason mentioned that I didn’t like my title, because it’s basically looks like what I do, which is what it should reflect. But integration is digital transformation. We live in the world where data is the key. And we at Platte River and our members, there is lot that needs to happen. We are merging operation Technology, Information Technology and bringing data science, data science is going to the future to be very precise on data science. We are looking at artificial intelligence, machine learning performance indicators. Why is all that important? Because the producers are also the consumers we know need to know how did they perform? How much did they perform, so that we can use that to forecast identify the trends and patterns identify what customers will do in terms of performance, will they perform, then the system needs them so that we can use we can count their capacity as something that is confirmed. All that information comes to this big information technology gets all this data that needs to be processed. On the transmission side. All the cities, including Longmont, there are a lot of things that have to happen in terms of policies, the rates and energy solution, customer solution, ami data, all of that the smart grid program that’s being done, all of that will fuel the virtual power plant that we are building. And this virtual power plant will allow us to participate in the markets, which I talked about. And again, it not only serves just the load that is long onslaught, but the system as such helps everyone with us. And then finally we have other assets. We have new resources, wind solar, we have to do a lot of resource planning a lot of planning to get this virtual power plant with other physical assets, bring it together and get into the market so that we serve our load at the least cost. And make sure we are managing the risks around that the volatility and make sure the key goal is how do we make sure that by 2030, we have that 100% carbon free goal we maintain. So the words will power plant is the last mile we can do these things, but without the support the communities to get to that last mile. It is the data information working collaborative with the staff. All of that is needed to get to the endpoint. And Edie we’ll talk more about what is needed How can we communicate and how do we work together? That is my last slide. I know I covered a lot of things some going to take questions or if I think I’ve made everyone sleep but it’s not that interest.

Unknown Speaker 1:09:41
Councillor Martin?

Unknown Speaker 1:09:43
Thank you Mayor pack about the virtual power plant I’m I am confused because when I hear about this, I am always Talk hearing about the city selling power back to P RPA. However, it’s my understanding that today, the substations we have in the substation meters and other regulatory equipment that regular the regulate the flow of real power are one way the city is a consumer only. And that to change the city to a producer, consumer, or even one of the city’s substations to a producer consumer, you have to make a capital investment in both substation equipment, which is a moderate amount of cost. And the transmission transmission lines, which are a rather large amount of cost. Am I correct? So far?

Unknown Speaker 1:10:52
Up? You’re correct, but I don’t follow the transmission investment because you’re talking about the substation upgrade. And we’re also talking about the in the two way communication. It’s the data that’s flowing.

Unknown Speaker 1:11:06
Well, yeah, there’s data flowing, but ultimately, if I mean, I’m surprised that you couched it in those terms, because if Longmont doesn’t have access data, Lamont has excess power. Right. And so I’m the way the mayor asked her a question that I think got deferred to you was the city sells power back. And I don’t understand why you are not modeling first, where the city never sells power back, but simply shifts its load curtails its demand and allows PR PA to put power where it is most needed based on the virtual power plant. So my question is, are you modeling that scenario, where the city delivery substations never have to be to a

Unknown Speaker 1:12:04
right? So, yes, we do model. So we in our resource planning model, we do model about 9200 megawatts of energy being available at the cities at different as different percentages based on the load ratio. And based on the forecast,

Unknown Speaker 1:12:23
not 100 megawatts for one city. But among

Unknown Speaker 1:12:27
all the four cities because when Platte River looks at it, it is one load note we serve one load, which is an aggregation of all four cities. So, for example, let’s say that there is 10 megawatts of energy storage or distributed generation, that is at Longmont. And that energy and remember, I also said the virtual power plant has two steps to it. One is What Does the city need? If there isn’t reliability need that girl and Dave thinks they need it and they would not move that information forward saying hey, this 10 megawatts is needed to serve our load right here, right to for the city. And if there are others that you don’t need that then you tell that this additional 10 megawatts is available for you to do it. This virtual power plant is the mechanism of doing that. Two things, when I say that 10 Mega we have model that we are expecting that this load that would have you would have been served by Platte River is serving with its own local generation. It just load reduction. Yes, right. That’s where

Unknown Speaker 1:13:41
I’m going it because

Unknown Speaker 1:13:42
so virtual power plant, if you’ve looked at it has got both demand. The electric vehicles, for example, could be charging an hour discharging another hour. When it’s charging, it’s a load when it’s discharging. It’s a generator, demand response, same thing. There are times when you reduce your load. All that information is for me to know how much generation I don’t need that I have accessed that I can sell it to the market. It’s a mathematical problem, whether you subtracted the load or subtracted the generation I understand

Unknown Speaker 1:14:11
what I am asking you is are you considering scenarios where long months excess for example, stored energy or long mines current solar generation is actually transmitted on the real grid out of Longmont to another city. So,

Unknown Speaker 1:14:38
you will have to look at this you are in that scenario, the electrons will flow out of the grid of the Longmont grid, right. Yes. And guess back to the power grid. Once it is there, it is a flow of electrons that are going to serve the load. So when I when I knew your question, if you say that Just let’s put some numbers maybe,

Unknown Speaker 1:15:02
I think I think you’re answering a different question than I’m trying to ask. Okay. Okay. I’m trying to there are two scenarios. One is where Longmont physically can in fact, push electrons back onto the transmission line and they are consumed somewhere else. Yep. It’s not really electrons. But anyway, you know, you give it the other scenario is where it can’t. Longmont can store more energy locally, it can use more energy locally, it can demand morely energy from P RPA. Or, but P RPA. cannot demand more energy from Longmont. And in that scenario, there are no capital investments needed at the substation. Correct in in the scenario where long launch in fact becomes a supplier to another city. There are capital investments needed. So what I’m asking you is, are you modeling the easier scenario where Longmont can increase its demand, curtail its demand? Increase its storage, but not ever serve loads in a different city, which is the capability that Longmont has now.

Unknown Speaker 1:16:35
I may still answer it in a different way. But when I’m because when you talk about Longmont specifically when Platte River is modeling the system, it is entire load that we are serving, it is one node that we serve,

Unknown Speaker 1:16:51
I understood that as well. But what I am not understanding is whether you are planning to make the investments in the physical infrastructure of the transmission system, including your half of the substations so that Longmont can produce power in the network as opposed to simply being a variable load.

Unknown Speaker 1:17:21
Now I follow your question. Yes. Okay. Thank you. So the investment in the distribution generation or the substation upgrade, which could be a non wire solution or a storage at that will be part of the after understanding, what is the inflation Reduction Act? How does that support that will help us to make identify, where could we strategically place that distributed generation and substation upgrades needed that will help your system? What that means is if I can avoid building a big, big storage, for example, and say that if I can distribute that storage among four cities, what would it need to support those for energy storage at the distribution system will definitely be something that we will be analyzing as part of this next IoT study.

Unknown Speaker 1:18:20
Okay, so you are saying that that? I mean, my intuition is that it’s cheaper not to upgrade the transmission lines and the store and the substations than it is to do that. So you are saying that, and I’m saying that’s just my intuition, because I haven’t run your model. But I never hear about that part. Okay. And it seems to me that that is potentially the least cost scenario. So Mike, my question is, are you modeling it?

Unknown Speaker 1:18:55
This point, we have not but the next RP 24, we will work with the city staff and identify those locations, what would be the right thing to do in terms of cost to serve the Lord? And if there is an alternate solution? Because till now, things were not looking in a way that it looked like you could do that distributed generation, it didn’t have that kind of infrastructure to support it, meaning there were no bills that would make sense for us to do it. Now, things have changed in the new with this bill, it’s where is that location, we are more independent, because the storage is never now doesn’t have to be charged with solar, it gets its own investment tax credit. That will change it. That will mean that where is the new location has got more, if that needs more transmission to support that and it’s the least cost that will be part of the analysis in the next resource plan. In the first in the RP 22. We said we were expecting 100 megawatts, but now it’s going One level deep and saying, Okay, now you, you’re asking, What if there is a system upgrade that can be done that still a least cost solution? We have not done in the past. But that is something that we will look because of the new changes. We have not done that in past we have now things are changing. That is the reason we have to look at that.

Unknown Speaker 1:20:24
The mayor doesn’t want me to answer any ask any more questions. So I have follow ups. But I have to ask permission. I don’t think my question was answered.

Unknown Speaker 1:20:39
mean, if you’re if I’m allowed. Yes, please. If you’re asking I think there are two parts to your question, right? Like I’ve I modeled that before? And my answer is no, I have not modeled a distribution system transmission upgrades at the distribution system. But my next answer, or the part two is next resource planning, we will look at those things because the system now there’s things in the bill that allows us to look at things like that, which we never were able to look before.

Unknown Speaker 1:21:09
I understand. So my my real question is, you’re not assuming you have to upgrade the substations and the transmission lines, your lease cost solution, if it involves the the cities being loads only. Is is acceptable,

Unknown Speaker 1:21:29
wouldn’t that I wouldn’t come to that conclusion that we’re that we wouldn’t look at an upgrade at the substation or because the loads. And so

Unknown Speaker 1:21:36
I was asking you whether you’re looking at the scenario where you don’t need to upgrade this substation, because every time I have heard it discussed, you are assuming that you upgrade the substations

Unknown Speaker 1:21:50
mean, we are assuming meaning we to support the 100 megawatts, I’m assuming that that 100 megawatts that is, or your portion of that 100 megawatts would require some kind of upgrade to the system to support that

Unknown Speaker 1:22:02
to the distribution system? Yes. Yes. That’s the assumption not to the transmission system, necessarily. Buggy. That’s what I wanted to get to. But

Unknown Speaker 1:22:13
it’s also important the new renewable resources that we are adding in the portfolio. In that scenario, we are looking at what transmission system upgrades we have to do to bring those renewable energy to server load as well, of course,

Unknown Speaker 1:22:25
for the remote ones. Yep.

Unknown Speaker 1:22:29
Thank you rush. there any more questions? I think we’re good. Thank you very much. Thank you.

Unknown Speaker 1:22:48
Good evening, good evening, Mayor Paik Mayor Pro Tem Rodriguez Councilmembers, respectful people’s times, they wanted to kind of summarize on behalf of Platte River, kind of the main takeaways from our presentation. And I asked, of course, many questions. Key key highlights that we want that Raj kind of mentioned is our conclusion of a resource planning guide, as we described as our blueprint, we concluded in 2020. Internally, we have some new organizational structures and new expertise around communications and transition technology, we’ll add on board with Roger nine colors on board. Our board did approve our zero portfolio for both our RFP and our clean energy plan. And as Raj mentioned, we do have an update already currently in the queue. So what’s in the inflamation implementation phase as which Jason might have mentioned is that we’re currently in the request for proposals. With the changes to legislation, there could be an impact, which may be a reduction, obviously, hopefully, in terms of the rate pressure, but we’re still monitoring that. And then in terms of our strategic plan for the company as a whole, not only looking at our workforce transformation in terms of our employees, but also kind of looking ahead to the future. So we can, the way I like to see it is 50 years ago, the organization was born out of the corner communities. And now it’s the next 50 years of investment innovation, strategically outlining that for both the board and our owner communities to understand and can’t say this enough collaboration with our owner communities around the integration and data systems that we’re going to be implementing. And this is a good chart that I think summarizes some of the things that we talked about today. The acceleration of our intermediate resources, right, shows the reduction. And I want to make a point that that 90% reduction is is in this point in time, you know, as we look ahead for the last, how do you get to the last 100% of the non-carbon that 10% goal, working with our owner communities on the integration datas system integrations around our work around that virtual power plant that Raj is discussing. And if you notice, kind of the the impact of our reduction in hydro, right, the carbon, the carbon reduction, and the impact that we’re doing. So if I had to summarize is the the implementation of acceleration of our resources, the intermittent work, the need for dispatchable resources that we’re going to need to make some decision on that may include thermal or not, and looking ahead towards what our portfolio will look like after our rate pressures that you’ll see In a consecutive period of let’s say, five or six years, hopefully then it decreases after 2030. And at least in my wheelhouse, you know, I’m going to take this opportunity. You know, we’ve been, we’ve been meeting with your staff, with both Becky and Scott and Darryl, and Dave, on working on how to create what it would it sounds like, to me, is a better communication to work together. Right. There’s a lot of complexity in this. And I think understanding explain to our communities kind of the impact, you know, what is the impact of their bill? What is the value proposition that the change in portfolio is doing, and then our engagement in our own communities in a way that he hadn’t seen before? And I think we look forward to having that partnership. So I, I respect people’s times, because no, we’re a little over. But we certainly take any more questions from the council. We appreciate this opportunity. And we look forward to continuing this conversation.

Unknown Speaker 1:25:53
Seeing no questions, I thank you very much for this presentation. It was very helpful. And I personally liked the way the PowerPoint took us through it step by step. Who, Oh, I see counselor what? And Brett, you snuck in

Tim Waters 1:26:13
there this? Honestly, this is probably for Jason more than I appreciate the all the information. And it’s less about power generation than it’s about kind of corporate priorities and and incentives. I assume you made a point, Jason earlier that for years for decades, right, the priority was reliability and affordability. And I assume that if I was on your board, I’m sure your board created incentives to make certain that those priorities drove management, thinking strategy, resource allocation, etc. Could you just share kind of just conceptually, I’m not trying to dig into your compensation schemes, but to the degree to which the commitment to zero carbon is, is tied to your incentives. For all for for you and for your for your senior staff. Is that a corporate priority? And is it reflected in how you guys earn bonuses?

Unknown Speaker 1:27:15
Yeah, all the way throughout the entire organization. But I would generalize it more to say, I wouldn’t point towards, because carbon reduction is volatile, right? It’s a bite, you have to look at the trend and over a period of time, but we take a step back. And a portion of incentive is based upon reliability metrics, right? A portion of its on affordability metrics. And another third of it is on environmental responsibility. And carbon reduction is a part of that. There are a lot of other compliance obligations environmentally to operate the existing facilities we have. So you can imagine

Tim Waters 1:27:53
so third of that incentive program is reflected to say sustainability, I should have framed as a sustainability priority.

Unknown Speaker 1:27:59
Yeah, it’s incorporated into all of that. And it’s helpful to know Yeah, and then I think if you take another layer back and look at it, you look at the strategic plan of the organization. I know personally, when I get my review from the board, right, we go over, hey, there’s the four initiatives in the strategic plan. We’re in year three of it, you thought you’d be here, you’re here. That’s what we discussed, and why I just hidden some areas behind.

Tim Waters 1:28:21
I think that’s it to know that we’re all on the pole and hard in the same direction or pushing hard in the same direction. And the

Unknown Speaker 1:28:28
point I want to make to answer your question is it’s throughout the whole organization, not just you, it’s it’s not just senior managers or directors, it’s all the way down to an accountant. Yep. But they all have a role to play in it. Thank you.

Unknown Speaker 1:28:43
Now, do I see any other comments? Nobody’s sneaking in here. Okay, thank you very much. Again, I really appreciated it. So let’s take a five minute break before we do the next presentation.

Unknown Speaker 1:38:01
So we are ready for our second presentation Platt. No, this is land development code amendments.

Unknown Speaker 1:38:09
You don’t want me to present on Platte River?

Unknown Speaker 1:38:10
No, I don’t think yeah, we’re done with that one.

Unknown Speaker 1:38:14
be entertaining at best. Good evening, Mayor, Members of Council. I’m Erin Fosdick with the Planning and Development Services Department. I’m joined tonight by exactly Zack, our environmental and sustainability planner and Ben Ortiz, our transportation planner, and we’re going to talk to you about land development code updates related to the Main Street corridor plan. We have a short presentation for you, um, obviously, we provided information in your council packet. But what we really want to do tonight is just do a little bit of background on the Main Street corridor plan. I know most of you are pretty familiar with this plan. So we’re not going to spend a lot of time on that. And then we’re really going to spend the bulk of our time talking about the proposed code amendments. Zacks gonna go through the proposed Red Line ordinances that were included in your packet. And this is really intended to be like a zero reading. We’re not introducing these obviously on first reading as this is a study session, but we wanted you to see the changes that you’ve initially directed us through the Main Street corridor plan acceptance to make so Zack will go through those and get into some additional details. Do you want to take this opportunity to note and Zack will reiterate this. These amendments are not intended to impact existing businesses. So we can talk a little bit more about other opportunities for future code amendments, but do want to get that get that out there that these amendments are really not intended to impact existing businesses along the corridor. I also want to mention that these amendments are part of a larger suite of amendments. And so you’ll see in the packet there’s some additional Main Street corridor plan amendments that we can talk a little bit more about. There’s also additional amendments that council is aware of that the planning department has been working on. I know Glenn spent some time with you all talking about those and you probably just talked about those a little But this evening, but those are work on housing incentives, the historic code updates, industrial design standards, and some other things. So those aren’t included in tonight’s discussion. But I do just want to remind council that this Main Street corridor plan amendments are part of those larger code amendments that that planning has been working on. I also want to mention that as we were working on these updates related to the Main Street corridor plan, we did note that there may be some additional items council wants to consider in the future. And those may be related to some of our greenhouse gas reduction goals, some of our other sustainability, or equity related goals. And so we haven’t included anything above and beyond what was recommended in the Main Street corridor plan in those red line ordinance the attachments that you have, but we will spend a little bit of time tonight talking about some of those options in case council wants to direct staff to take a look at future amendments. So again, Zack will go through the red lines and what we’re proposing that’s related to the corridor plan and then we’ll we’ll talk about some additional options if Council is interested. We do hope to get direction tonight on the red line ordinances that are in your packet. So as I mentioned, I want to take just a second at refreshing Council’s memory on the the main street corridor plan which was accepted by council in October 2019. This plan, as you’ll recall, provides a vision for the five mile long Main Street corridor that stretches from Plateau road on the south, all the way up to highway 66 on the north, and obviously spans Main Street. The plan does identify four character areas which you can see here. The purpose of the plan was really to develop a vision for the corridor, identify those areas of strength and stability along the corridor as well as some opportunities for areas of change. The plan really sets forth a plan for revitalization and redevelopment of the corridor and really emphasizes those catalyst development sites, and transportation improvements to help us enhance mobility and create a sense of place. The plan also contained a number of land use recommendations, and those are in your council column as a reminder, but these are really important for us to think about as we talk about the code amendments sites. It’s part of the why behind what we’re bringing you tonight. So several the proposed amendments directly support these recommendations such as providing additional opportunities for mixed use development and residential development within the corridor, diversifying and enhancing the economic base through strategic infill focusing on those catalyst sites and areas of change, when considering redevelopment and probably most importantly, is creating and enhancing that overall sense of place throughout the corridor. So these updates that we’re talking about tonight are one piece of plan implementation. Obviously, there’s a whole host of other actions that are contained in the plan. We’re not going to go through those tonight. But these code amendments are really critical in helping helping us start to realize that vision that’s articulated in the plan. I’m happy to provide more information on the Main Street corridor plan but hopefully that can

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