Fort Collins Energy Board 7/13/2023 by Kevin Stearns
Meeting Summary
The meeting of the Energy Board included some (but not all) of the items on the agenda.
- Quarterly Financial Report
- Customer Information and Billing System
- Vice Chairperson Election
- Energy Board Objectives
The board was focused primarily on strategies needed to fund and deploy changes to Light & Power which would help the city reach its Our Climate Future goals. There was a debate over the scope of the board and whether or not it could recommend actions not specifically laid out by city council yet still in line with their broader objective of working towards being carbon neutral.
Meeting Readiness Checklist:
Full Meeting Notes:
Goals and Outcomes
The meeting of the Energy Board included some (but not all) of the items on the agenda.
- Quarterly Financial Report
- Customer Information and Billing System
- Vice Chairperson Election
- Energy Board Objectives
The board was focused primarily on strategies needed to fund and deploy changes to Light & Power which would help the city reach its Our Climate Future goals. There was a debate over the scope of the board and whether or not it could recommend actions not specifically laid out by city council yet still in line with their broader objective of working towards being carbon neutral.
Motions
Present to city council the plan for implementation of the new modernized billing system.
Motion Passed (unanimously)
Elect Vanessa Paul for vice-chair of the Energy Board.
Motion Passed (unanimously)
Quarterly Financial Report
Light & Power operating expenditures are high, which is causing the operating income to fall below the target. Operating revenues are over budget, as are non-operating revenues from new development and earned interest (but new development is slowing). Labor costs increased as they
had been deferred to Connexion (Connexion and Light & Power is one legal enterprise fund). Connexion buildup was also ramped up this year (in areas where it makes most financial sense from the number of gained customers weighed against the expense of expansion). There were also higher maintenance fees this year, such as from repairing two transformers which failed due to flooding.
The board has been awarded a grant proposal for zero carbon performance code, which is entering the negotiation phase.
Customer Information and Billing System
The current utility billing system for Fort Collins is 22 years old and is to be replaced with a new system. This system will use a software as service model, which will receive constant updates, unlike the current system. It will also be under a subscription rather than a licensing model.
Implementing the new system will cost an estimated $13,950,000 on top of an annual subscription fee of $1,250,000 a year (the current contract costs $700,00 a year). This will fund the project management, quality assurance, contract review, and contractual staffing for the project. This system will cover all four utilities (which does not include Connnexion). The goal is to implement a system which will increase security and integrate with other systems as the industry continues to evolve. The expectation is that the city will have some influence on the development of the software. Systems like this from this vendor have already been in use for about a decade. It will require staff and a cultural shift to keep up as the software changes. The system is expected to be in place by October 2025.
Software and technology in the energy sector is changing extremely fast. Outside help will be necessary for implementing the new system, and the contract should be viewed by an outside legal consultant.
Energy Board Objectives Debate
The Energy Board is currently focused on advising city council on the climate crisis, with a focus on objectives laid out in Our Climate Future. There is a balance needed between low emissions and low utility rates. Working with other boards, such as the Equity, Diversity, and Inclusion Board, is very important. The Energy Board should also engage with and advise the Plat River Authority board of directors. An 80% carbon reduction by 2030 is the top level goal to present to city council (who currently believes that a 70% reduction is the best case scenario). Plat River Power Authority claims that 88% carbon neutral is their best case.
There is a debate on focusing on a transition from a centralized to decentralized energy system. Since this is not a goal outlined by city council, this is a subject that could be seen as outside the scope of the Energy Board. However, it could also be seen as fitting within the greater goals outlined by Our Climate Future. There are disagreements within the board over the practicality of decentralization, such as who would pay for it and how it would impact Plat River Power Authority. There may not be enough financial incentive in Fort Collins to have people produce and sell their own power. However, decentralized energy production is happening all over the country. Also, Fort Collins already has the most distributed solar energy in Colorado. There is also some concern over a $1-2 billion investment that Plat River Authority is making, and a desire to know what that investment is for. The Energy Board was in general agreement over working to communicate with them, but hesitant to focus much on distributed energy.
Final Questions
How proven is the “software as service” model for improved security and functionality? Are there any unintended consequences from shifting from an ownership to a rental model for critical systems like this?
It was assumed that an energy market was needed for a distributed energy network, but is this the only route to distributed energy?