07-29-2020 HUCMMINUTES
R
Wednesday, July 29, 202,0
Call to order — 3:00 p.m.
President Don Martinez called the meeting to order. Members present: President Don
Martinez; Vice President Matt Cheney; Secretary Robert Wendorff; G,M Jeremy Carter;
Attorney Marc Sebora;
Absent: Commissioner Monty Morrow, Commissioner Anthony Hanson
Conflict of Interest
2. Approve Consent Ager'
a. Approve Minutes
b. Ratify Payment of Billsl
111otion by Commissioner Cheney, second by Commi i ssioner Wendorff to approve
the Consent Agenda. Motion, carried unanimously.
3. Approve Financial Statements
Commissioner Hanson joined the meeting at 3:02pm
GM Carter presentedthe Financial Statements. In the Electric Division, net profit
increased by $198,785 mostly due to receiving insurance proceeds from the
transformer fire of $240k. There was not a power cost adjustment (PCA) for June,
which will most likely be the last month with no PCA. In the Natural Gas Division,
June 2,020 financial numbers are very similar to June 2019.
Motion by Commissioner Wendorff, second by Commissioner Cheney to approve
the financial statements. Motion carried unanimously.
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5. Communication
a, City Administrator— Matthew Jaunich — Absent
b. IDivisiions.
i. Dan Lang, Engineering Services Manager — Absent
ii. Dave Hunstad, Electric Transmission/Distribution Manager— Absent
iii. Randy Blake, Production Manager — Absent
iv. John Webster, Natural Gas Division Director — Absent
v. Jared Marti, Financial Manager- Absent
e. General Manager — Jeremy Carter
L Power outage earlier in the day that lasted about 10 minutes. Traced fault
back and Staff will assess into if a new wire or new conductor is needed.
ii. Projects are going well, along with maintenance and generation.
6. Policies
a. Review Poes,
L Appendices of Exempt Handbook
ii. Appendices of Non-Exem;ipt Handbook
No changes recommended at this time.
b. Approve Changes
No changes recommended at this time.
7. Unfinished Business
a, None
8. New Business
a. Re -adopt the Data Practices Act it Public Records Request Policy
Mr. Sebora presented Re -adopt the Data Practices Act & Public Records Request
Policy. The State of Minnesota requires that political subdivisions l,ike HUC adopt
a data practices policy, which, guides both the HUC and members of the public in
obtaining information from HUC. State of Minnesota also requires that HUC adopt
the data practices policy annually prior to August 1.
A motion by Commissioner Hanson, second by Commissioner Cheney to Re-
adopt the Data Practices Act & Public Records Request Policy. Motion carried
unanimously.
GM Carter presented the Continuity of Operation Plan. Originally, HUIC had an
older internal plan. With the current COVI D-1 9 Pandemic, Staff has been working
on, making the needed changes and updates to encompass more of an overall
plan. The Continuity of Operation Plan has been updated with Centers for
Disease (CDC) and MN Department of Health guidelines. Since HUC is
considered an essential operation, Staff needs to do what is possible to protect
the workers by also keeping the power on out in the community. This Continuity
of Operation Plan is, a broad document and changes will be incorporated as
needed and on an annual basis.
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The Commission Board agreed that the Continuity of Operation Plan should be
reviewed annually.
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c. Approve Virginia Transformer, Corporation Contract —Plant #2 25/467 MVA
LCT Transformer
President Martinez stated that Staff is still waiting for the Certificates of Insurance
for thus item and item d. A special meeting will be held for both, agenda items
when Staff receives the Certificates of Insurance. Therefore, agenda item c and d
willl Ibe tabled from this meeting.
A motion by Commissioner Hanson, second by Commissioner Wendorff to tabile
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both agenda items c and d. Motion carried unanimously.
d. Approve Virginia Transformer Corporation Contract — Plant #2 Groundi
Transformer I
GM Carter presented Approval of Requisition CE Power Plant #2
Substation Improvements. Due to the Plant 2 substation transformer fire, H'UC
will need to upgrade the site to accommodate the new transformers and
switchgear, Staff is requesting approval to ow CE Power to, provide the
required technical labor, supervision, basic equipment, materials, and engineering
to perform the scope of work.
Commissioner Hanson inquired if there are any issues moving forward with this
agenda item if the agenda items c and d were tabled from above. GM Carter
stated that there are no issues since the specs on both, the Transformer contracts
will stay the same', Staff is just waiting for the Certificates of insurance.
A motion by Commissioner Wendorff, second by Commissioner Hanson to
Approve Requisition #8478 — CE Power Plant #2 Substation Improvements.
Motion carried unanimously.
f. Solar Array Discussion
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GM Carter initiated the Solar Array discussions. GM Carter noted that revised
numbers were sent out to all the commissioners from two developers that do handle
utility scale solar systems. Along with the revised numbers, points to consider are
financing structures and if this could be self-fundled or financed through a PPA
structure. Conversations were held on the size and price of a solar array or solar
garden that HUC would consider for the community along with moving forward, with
an RFP. There are many programs that can be established out of solar array project
of a larger scale or with a second phased approached...
Consensus from the Commission Board is to proceed on receiving pricing and to
continue down the path of Solar Array.
g. Great Energy Choices Discussion
GM Carter noted this should be stated Bright Energy Choices not Great Energy
Choices. GM! Carter initiated the Bright Energy Choices discussion. A wholesale
supplier provides this program. The wholesale supplier on behalf of its members
provides customers in town with the ability to be 100% renewable or 100% carbon
free if customers choose to be. For the amount of KWH that is needed to become
100% renewable or 100%, carbon free HUC would submit those KWH to MIRES
on a regular basis. Customers would essentially be buying REC's (Renewabile
Energy Credits) that signify the amount of KWH going to the customer from HUC
through MIRES are renewable,s or carbon free sources. Customers would now
have certification/ certificates that validate renewablles came from a wind farm,
solar garden or other renewable source. GM Carter noted that many municipal
utilities are involved with Bright Energy Choices and' have customers that are a
part of this program. There is an up charge/auction cost of .05 cent added onto
the KWH that HUC would be buying. This.05 cent could be passed on to the
customer's bill. Every uitil'lity is different depending on renewables that are being
offered in their current power supply portfolios.
Discussions were held on when a program like this could be rolledout, the length
and flexibifity a cuistomer has to stay on this program and if this program
competes or compliments the proposed solar project.
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h. Electric/Natural Gas Glide Path Discussion
GM Carter initiated the Electric/Natural Gas Glide Path discussions. GM Carter
recapped conversations and meetings that were held on the COS study from
previous years. Utility Financial Services had proposed a 2-year rate adjustment
for both, the Electric and Natural Gas divisiion. As part to the, rate designs for each
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division, a 6-year glide path for the Electric division and a 9-year glide path for the
Natural Gas division was determined. Currently HUC has been using the first two
rate adjustments that were adopted 2 years ago, that went into effect Oct 2018
and Oct 2019, At last year's Strategic Planning meeting, discussions were held
on if HIUC is to continue moving down the glide paths to rebalance the customer
classes. GM Carter noted if the Commission wants to stay on, the same
implementation date of Oct 1, conversations are now needed to stay ahead of
that date because the City Council needs time to veto any previous rate
adjustment changes if so chosen.
GM Carter reviewed an overall table of what the COS rates were back then,
where the rates have been and what the proposed rates, will be for the next 2
years to show how the glide paths have been working.
After discussions were held, the consensus of the Commission Board is to stay
on the current glide path for all customers and businesses. GM Carter will plan
on having a resolution for the next 2 years at the August Commission meetings.
9. Adjourn
There being no further business, a motion by Commissioner Wiendorff, second by
Commissioner Cheney to adjourn the meeting at 4:12ip.m. Motion carried
unanimously.
ATTEST:
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