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HomeMy WebLinkAbout2009-12-02 Utilities Advisory Commission Summary MinutesFINAL UTILITIES ADVISORY COMMISSION MINUTES OF DECEMBER 2, 2009 CALL TO ORDER Chair Melton called to order at 7:07 p.m. the meeting of the Utilities Advisory Commission (UAC). Present: Commissioners Ameri, Eglash, Foster, Keller, Melton, Waldfogel, and Council Member Yeh Absent: Commissioner Berry ORAL COMMUNICATIONS None. APPROVAL OF THE MINUTES The minutes from the November 4, 2009 UAC meeting were unanimously approved. AGENDA REVIEW No revisions were made to the agenda. REPORT FROM COMMISSION MEETINGS/EVENTS No reports were offered. UTILITIES DIRECTOR REPORT Utilities Director Valerie Fong delivered an oral report on the following items: 1. Smart Grid Consultant RFP: City received 11 proposals from consultants to assist the City in evaluating and developing a smart grid road map for the City. Staff expects to pick the winning proposal by end of December, seek Council approval and commence work by February 2010. 2. Fall 2009 Renewable Power RFP: The City received over 40 proposals to provide renewable energy to help meet the City’s Renewable Portfolio Standard. Staff is evaluating the proposals and will develop a short list of candidates in the coming weeks. 3. Economic Stimulus Funding – Energy Efficiency and Conservation Block Grant (EECBG) and Other Stimulus Funding Efforts: The EECBG funding of $663,000 was received at the end of October. A Request for Proposals for the Home Energy Report (or Utility Usage Report) portion of the stimulus grants has gone out to vendors. Proposals are expected in the first week in December. After review of the proposals, staff expects to go to Council with a contract for this service in January or February 2010. Other stimulus fund programs that staff is working on in coordination with other entities include: a statewide “CaliforniaFIRST” program to provide property-tax based energy efficiency loans for residents, “Keep Your Cool” program to enhance the provision of electronically controlled motors for coolers in convenience stores and commercial kitchens, and a partnership with Wave One to increase the funding available for small business efficiency projects in the City. Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 1 of 9 4. Landscape Water Efficiency Ordinance: The Department of Water Resources’ (DWR) model landscape water ordinance goes into effect for water purveyors and communities on January 1, 2010. Staff will be bringing a proposed water ordinance, developed to be at least as effective as the state’s model ordinance and in coordination with Bay Area Water Conservation Agencies (BAWSCA), to the UAC in January. The ordinance will then be heard by City Council in February and March. Also coming to the UAC in January 2010 will be a discussion on possible ways to implement water conservation efforts to meet the goal of reducing water usage by 20% by 2020. 5. Market Price Referent: The CPUC recently issued a Draft Resolution which will adopt the Market Price Referent (MPR) values for 2009. The Draft Resolution sets the market price referent for a 10- year contract with a start date of 2010 at approximately $84/MWh. Prices then increase incrementally based on the start date and contract term. The market price referent values for 2009 are significantly lower than the values for 2008 because of the low natural gas prices throughout 2009. The 2009 MPR values also include the cost of compliance with GHG regulations. Using a CO2 Price Forecast, the CPUC set the cost of emitting CO2 on a per ton basis at $10.44 in 2012, $24.35 in 2015, and $43.52 in 2015. The CPUC will vote on the Draft Resolution at its December 17, 2009 Business Meeting. 6. Direct Access: SB 695, enacted October 11, 2009, partially lifted the suspension of direct access, allowing non-residential customers to receive direct access service up to a maximum kWh level set by the CPUC. SB 695 requires the CPUC to set the annual limit on direct access for each IOU “at the maximum total kilowatt-hours supplied by all other providers to distribution customers of that [IOU]. SB 695 requires that the new cap be phased in over of period of at least three years, but no more than five years. On November 18, the Assigned Commissioner in the CPUC’s direct access rulemaking issued a ruling setting the schedule for the adoption of the new maximum direct access levels. The ruling requests each of the IOUs to file information showing what the applicable maximum cap is for its service territory is, based on the criteria listed in SB 695. The ruling anticipates a proposed decision in mid-February 2010, and a final decision in March. Implementation must begin by April 2010. 7. 3 Potential Topics for the Upcoming Joint Meeting of the UAC/Council, scheduled for December 14 at 7:00 p.m. 1) UAC response to Council on Ad Hoc Subcommittee Update on Review of the UAC’s roles and responsibilities. 2) Discussion of appropriate balance between the UAC’s focus on policy, plans, rates issues, legislative and regulatory issues, and environmental issues. 3) Discussion of protocols for Council/Commission communications. Chair Melton commented that another topic that could be included in the joint UAC/Council meeting is the extent of community engagement activities that the Council expects from the UAC. He said that the UAC should discuss this as a commission to establish the relative priority of these activities. Commissioner Waldfogel asked if the annual analysis of the Calaveras Reserve, including the calculation of stranded cost will include a discussion of SB 695. Director Fong assured him that this would be the case. Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 2 of 9 UNFINISHED BUSINESS None. NEW BUSINESS ITEM 1: ACTION ITEM: Recommendation to Approve Recycled Water Salinity Reduction Policy When the item was announced, Commissioner Ameri indicated that he would recuse himself from the discussion of this water related issue since he works for a water agency in the East Bay that receives water from the same supplier as Palo Alto. He explained that there was no financial conflict of interest, but since there could be a perception of a conflict, he has chosen to not participate in the discussion. He left the room for the item. Senior Resource Planner Nicolas Procos provided a presentation to the commission summarizing the written report. Environmental Compliance Manager for the Regional Water Quality Control Plant (RWQCP), Phil Bobel, also contributed to the report and was available for questions. He briefly reminded the Commission about the Palo Alto Phase 3 project that would provide about 900 acre-feet per year to the Stanford Research Park. The recycled water quality is a concern with respect to the use of recycled water for irrigation of landscaping, especially certain salt-sensitive species such as redwoods. Palo Alto’s recycled water has a higher content of Total Dissolved Solids (TDS), a salinity indicator, than would be expected given the extremely low TDS in the source potable water in the service area of the RWQCP. The plant partner making the biggest contribution of salt to the plant is Mountain View. It is the only partner whose influent to the plant has a TDS of above 650 parts per million (PPM). Procos explained that the proposed Recycled Water Salinity Reduction Policy establishes a TDS goal for recycled water produced by the plant of 600 PPM. This goal was developed using the following assumptions:  The source water for the different agencies has very low TDS levels (~100 PPM in aggregate)  Normal, unavoidable, human activities will contribute an additional 350-400 PPM to the total TDS levels  A buffer of 100-200 PPM is needed as it is impossible to completely eliminate saline groundwater infiltration. Procos further explained that the policy does not have an enforcement mechanism, although that could be a future feature. The policy does not provide, nor is it based on, an assessment of what number represents a suitable TDS level for irrigation purposes. This issue will be addressed in the near future during the environmental review phase for the Palo Alto Recycled Water (Phase 3) Project. In addition, the policy does not establish a firm “delivery guarantee” for future recycled water users. Public comment on Item #1: Jim Inglis, Director of Design and Construction for the Stanford Real Estate Office read prepared comments on the proposed Recycled Water Salinity Reduction Policy and provided the comments in writing:  “It is positive that the City is promoting a policy to minimize salinity in its recycled water. The proposed salinity reduction policy is an important first step, and as we support efforts by Palo Alto to take the lead and coordinate with the communities served by the Regional Water Quality Control Plant to identify salt inputs to their wastewater and to develop an implement concrete measures to control salinity. Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 3 of 9  “We realize that tonight the UAC is not addressing the specific issues associated with managing the use of recycled water for landscape irrigation. However, we want to present our concerns to the UAC, so that it is aware of the issues that may arise as the City moves forward with its recycled water program.  “The City is considering potential future use of recycled water to irrigate landscaping at the Stanford Research Park, which contains many salt-sensitive plantings and soils with poor drainage. We understand that the City intends at some point in the future to reinitiate the environmental review process for such use, and we understand that, as part of the process, the City will examine and consider the deleterious salinity impacts to plants and trees such as coastal redwoods.  “As reflected in the Recycled Water Guidelines prepared by HortScience that we have submitted to the City, we believe it is essential that potential future use of recycled water for landscape irrigation include appropriate mitigation and management measures. These measures, when they are ultimately adopted by the City, should include enforceable limits for all of the relevant constituents of concern for salinity, as identified in HortScience’s Guidelines, and not just a single constituent such as total dissolved solids. There measures should also recognize that recycled water failing to meet the appropriate limits for salinity should not be used to irrigate salt-sensitive landscaping.” Herb Borock, Palo Alto resident, commented that when the recycled water project has been presented by staff in the past, the price and fee schedule for the recycled water does not cover the cost of the project. Staff has compared the cost of the project to the wholesale cost of water, but it should have been compared to the retail rates, which are four times the wholesale rate. Staff should look at all costs of recycled water when establishing prices for recycled water to avoid potable water users subsidizing those who use recycled water. Commissioner Foster asked about the status of Palo Alto’s recycled water project. Procos replied that the planning has been completed, including development of a cost estimate of about $33 million. Foster asked if the project will address the concerns raised about recycled water quality. Procos confirmed that the environmental document would address that issue. Commissioner Eglash asked why staff said that there would be no cost to Palo Alto to implement the policy. Procos responded that Palo Alto’s wastewater collection system CIPs are doing the job well of repairing leaks, which reduces the introduction of saline groundwater into the wastewater collection system. Bobel added that the partners also understand the problem and Mountain View is moving forward to repair or modify its systems. Commissioner Eglash noted that the approach was not to set a goal at a level to meet irrigation needs, but to see what is reasonable based on source water quality and what is achievable. Procos confirmed that this was correct. Bobel added that it’s very difficult to establish an acceptable level for irrigation needs since it depends on many factors such as soil types, drainage conditions, and plant materials. Eglash asked how staff plans to address the other constituents besides TDS. Bobel responded that they will be addressed in the environmental document. Commissioner Keller asked what adopting this goals means since it is not enforceable. Fong stated that it was important to establish a goal as a first step. Bobel added that enforcement may need to be added in the future, but it may not be easy as there are many contracts that govern operations of the plant and responsibilities of the plant and the partner agencies. These contracts cannot be unilaterally changed by Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 4 of 9 Palo Alto. Keller asked how motivated the partners are to adopt such a policy. Bobel responded that Mountain View is motivated since it is using the recycled water now. Keller asked about the timeline for achieving the goal. Bobel said that it relates to how fast Mountain View can respond by re-directing its CIPs or spending more on the repairs or taking a longer time to complete them. Keller asked if goals would be established for other constituents. Bobel said that that plant is working on this now and installing improved monitoring to track these constituents and determine where they are coming from and the impacts of the treatment process on them. Commissioner Waldfogel stated that the overall objective of the policy is to reduce the potable water use. He wanted to see how much more recycled water could be used by achieving the goal. Procos said that this analysis has not been done, but that lower TDS will make the water more acceptable and make the exemption process in the Recycled Water Mandatory Use Ordinance less likely to be needed to protect certain landscaped areas. Waldfogel questioned whether reducing TDS would increase usage of recycled water. Bobel said that if we wait to agree on a magic number, work will never get started. Council Member Yeh stated that if there were no enforcement mechanism, why call it a policy, rather than a goal or a target. Since it is presented as a policy, he suspects that Council may ask questions about the costs, benefits and environmental impacts of implementing the policy. Bobel noted that policies are the tool that Council uses for these types of actions and that staff can use them to show Council support for programs. Assistant Director Jane Ratchye also stated that the RWQCP has successfully used this mechanism in the past on several occasions, but that they hadn’t gone through the UAC and that it was possible that Council Member Yeh had not see such a policy in his tenure on the Council. Bobel confirmed that the plant has used the policy mechanism where Palo Alto first adopts a policy developed by RWQCP staff and then the policies are adopted by the other plant partners. He cited examples of using the policy mechanism to reduce mercury and pesticides, but acknowledged that it was before Yeh was on the Council and that, since they are related to wastewater, and not recycled water, the policies had not been considered by the UAC. Council Member Yeh questioned whether the goal of 600 PPM would have cost implications and whether an environmental review should be completed first. He asked if the environmental analysis that will be completed for the recycled water project will show the relationship between the amount of water used and TDS values of 400, 500, 600, 700, etc. PPM. Bobel stated that the goal of 600 PPM was arrived at in two ways: One method was to add allowances for human activity and for the fact that one can’t stop all infiltration to the TDS of the aggregate source water; the second method was to determine the outcome if Mountain View fixed the problems that have been identified. Chair Melton asked the Commission to stay focused on this policy and noted that the environmental document is not being considered at this time. He added that the Stanford Real Estate Office has indicated support for the policy and has indicated an acceptable TDS value that is in line with the goal in the policy. He indicated that he supports Palo Alto taking the lead and hopes that the other partners will follow suit. Commissioner Keller asked if the there is a Plan B if the policy doesn’t work. Bobel responded that the plant will continue to assist the partners in finding problem areas that need to be fixed. Keller added that she has heard about many issues with the use of recycled water and knows that Palo Alto has been using recycled water on the Municipal Golf Course and at Greer Park. She asked if we are doing baseline studies prior to the application of recycled water. Bobel responded that there are baseline studies being Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 5 of 9 done in Mountain View to monitor selected locations that will receive recycled water. This will need to be done in the Stanford Research Park as well. Procos added that the environmental document will have to address this, too. Commissioner Waldfogel commented that the goal was good, but that he has trouble since no analysis was provided about how much money may be spent to achieve the goal and how much additional potable water would be saved by achieving the goal. He also noted that the policy seems to not require Palo Alto to go anything, but it may obligate others (i.e. Mountain View) to spend millions of dollars. Commissioner Eglash added that he was concerned that some partners might be expected to reduce further and that Palo Alto should not have to do anything. He would much rather see a policy that conveys that Mountain View is the problem. Commissioner Foster asked if Palo Alto should be the first to adopt the policy, or whether Mountain View should go first. Bobel said that Palo Alto, as the operating partner of the RWQCP, always leads. This has been the practice in the past on many policies of this type. Council Member Yeh expressed concern about the lack of enforcement for the policy and wondered what has been done in the rest of the country. Bobel said that he was not aware of any such policy for TDS for any other wastewater treatment plant. Council Member Yeh also suggested that staff delay taking the policy to the Council to provide him/others some time to do outreach to Mountain View to assess its Council’s willingness to also adopt such a policy. Chair Melton noted that the protocol in the past is that Palo Alto initiates and then the other plant partners follow. Commissioner Eglash asked why the goal was put on the recycled water output rather than on the plant influent. Bobel said that this is in the spirit of cooperation and not to complicate it since each partner has a slightly different water supply source mix. Commissioner Eglash stated that if staff thinks that the policy would be a useful tool to get partners to act, he is supportive of it. Commissioner Waldfogel asked if the best way to achieve the goal is to adopt this policy. He questioned whether it would be productive to show how Palo Alto is doing well, but that Mountain View is not. ACTION: Commissioner Eglash made a motion that the UAC recommend that the Council adopt the proposed Recycled Water Salinity Reduction Policy. Chair Melton seconded the motion. The motion passed (4-1) with Commissioner Waldfogel voting NO. After the item was completed, Commissioner Ameri returned to the meeting. ITEM 2: ACTION ITEM: Utilities Legislative Policy Guidelines for 2010 Senior Resource Planner Debra Lloyd noted that the commission discussed the 2010 legislative policy guidelines at the November 2009 meeting. The proposed guidelines incorporated the recommended change provided at that meeting. Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 6 of 9 Commissioner Keller asked if the goals presented in the guidelines were listed in priority order. Lloyd responded that they were not in order of priority; rather, staff attempts to balance the goals for each issue that arises. Commissioner Foster asked if it would be possible for staff to email the UAC when the City has decided to take a position on a legislative initiative to allow individual members of the UAC to comment. Director Fong stated that this would be a burden on staff and that there could be compliance issues with the Brown Act for such a practice. Commissioner Eglash stated that this suggestion to solicit UAC input on a position taken could put a wrench in the works, but that he would like to know about the position taken after the fact. In support of Commissioner Eglash’s suggestion, Commissioner Foster then withdrew his suggestion. Commissioner Waldfogel stated that he appreciates the concerns about staff needing to act quickly to respond to legislative initiatives and take positions in line with the guidelines, but noted that the UAC has an affirmative responsibility under the municipal code to be involved in legislative initiatives. He said that he understands the problem with dealing with issues real time, but approving guidelines annually is at the other end of the spectrum. Fong stated that the City Attorney has said that the municipal code refers to cases where the City is actually proposing new legislation, not necessarily to the development of positions with respect to legislative initiated by others. She added that generally the City will participate in the development of positions with other multi-agency groups, such as the Northern California Power Agency (NCPA) or the California Municipal Utilities Association (CMUA) Chair Melton agreed that Palo Alto only rarely takes a position alone. Instead, it participates with other agencies to negotiate positions so that the weight of more agencies can be brought to bear on the issue at hand. Melton added that he finds the weekly summaries of legislative information that staff passes on from NCPA to be highly informative and uses them as an opportunity to ask questions of staff. Public comment on Item #1: Herb Borock, Palo Alto resident, commented on three areas: 1. The UAC’s authority in the municipal code should be unambiguous and he would like to hear from the City Attorney’s office on the interpretation of it, not from staff. 2. At one time, the Council had a standing legislative committee. This could be done again. 3. There is a Brown Act issue as Commissioner Foster’s suggestion sets the stage to violate the Act. A response would put staff in an intermediary position. Council Member Yeh agreed with staff that time doesn’t allow for direct input into the process, but UAC members can talk directly to individual Council Members. Also, UAC members sometimes attend legislative advocacy meetings. Chair Melton suggested that the words “preserve/enhance” found in the first goal under “All Utilities” should be used instead of “protect/enhance” found in the first goal under “Gas” and “Electric.” Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 7 of 9 ACTION: Commissioner Waldfogel made a motion to recommend that the City Council approve the proposed Utilities Legislative Policy Guidelines for 2010 with the change suggested by Chair Melton. Commissioner Eglash seconded the motion. The motion carried unanimously (6-0). ITEM 3: ACTION ITEM: Formation of Ad Hoc Subcommittee to Review Utilities CIP Budget ACTION: Chair Melton appointed Commissioners Waldfogel and Eglash to an Ad Hoc Subcommittee to review the Utilities CIP budget. ITEM 4: DISCUSSION ITEM: Protocols on Response to Public Input Chair Melton stated that the public can provide input to the UAC in two ways: 1) at the beginning of each UAC under the “Oral Communications” section for any items that are not on the agenda; and 2) on specific agenda items. During the first type of communication, the proper response is to thank the person providing the input, but that no discussion can occur since the item raised is not on the agenda. However, on specific items on the agenda, commissioners can ask clarifying questions, or ask staff to respond to the issues raised. Commissioner Foster added that the public can also receive input from letters or email directed to the UAC. He understands that individual commissioners can respond to this input, but wants to make sure that there is a mechanism to get back to the commenter. Council Member Yeh indicated that all communications with the Council are provided in the Council packet, which is something that could be done with the UAC. ITEM 5: DISCUSSION ITEM: Response/Recommendation to Suggestions on Verbatim Minutes Chair Melton stated that the UAC used to have verbatim minutes and that they were “ineffective” and noted that the current sense minutes are great. In addition, the meetings are recorded so actual meetings can be reviewed by any members of the public. He added that developing verbatim minutes requires additional staff resources. Commissioner Foster stated that he, too, preferred sense minutes to verbatim minutes and would recommend that staff get back to the member of the public that requested consideration of verbatim minutes. Commissioner Waldfogel also preferred sense minutes, but have heard from one Council Member who prefers verbatim minutes. Chair Melton summarized that the sense of the commission is to remain with sense minutes and to request that staff respond with that decision to Mr. Hoel, who raised the issue. ITEM 6: DISCUSSION ITEM: Protocols for Adding Topics for Future UAC Meetings Chair Melton noted that Commissioners can request topics for future meetings under the standing item on the agenda, “Potential Topic(s) for Discussion at Future UAC Meetings.” Commissioners could also use “colleagues’ memos” to introduce an item. He added that the Commission should decide how many votes should be required to add an item to the agenda. Council Member Yeh said that the Council usually reaches consensus or uses a Colleagues’ Memo. Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 8 of 9 Commissioner Foster stated that at least three Commissioners should agree that an item be placed on an agenda. Commissioner Eglash warned against adding a burden or directing staff. Chair Melton proposed to refer requests to the Director and noted that even if the Commission all wanted an item on the agenda, it would be up to her to set the timing of bringing the item forward based on her other priorities. Commissioner Waldfogel noted that these types of protocol issues should be found in bylaws and recommended that the Commission should take up the preparation of the bylaws to establish such protocols. ITEM 7: ACTION ITEM: Potential Topic(s) for Discussion at Future UAC Meetings Chair Melton asked if there were any Commissioners who wanted to add any future topics. Commissioner Waldfogel said that he wanted to find out about commercial customer interest in the PaloAltoGreen program. He was interested in hearing about the level of interest, participation levels and the City’s marketing efforts to commercial customers. There was concurrence by the rest of the Commission that this topic should be added to a future agenda. Chair Melton asked that the agenda for the January meeting include an action item to form an Ad Hoc Subcommittee to work on bylaws for the UAC. He noted that he has already begun some work on the bylaws. INFORMATIONAL REPORTS The following reports were provided for information only, but were not discussed by the Commission:  Utilities Quarterly Update  City of Palo Alto’s Energy Risk Management Report for the First Quarter, Fiscal Year 2010 COMMISSIONER COMMENTS Commissioner Foster sated that he was disappointed at the low response rate for solar hot water heating program that was noted in the quarterly update. Council Member Yeh noted that at the beginning of each year the Mayor appoints liaisons to various commissions including the UAC, so Council Member Yeh may or may not continue as the UAC Liaison. He expressed gratitude to the UAC for its service to the City in 2009. Meeting adjourned at 9:50 p.m. Respectfully submitted, Marites Ward City of Palo Alto Utilities Utilities Advisory Commission Minutes Approved on: January 6, 2010 Page 9 of 9