Pre-Meeting Q & A from the Board - February 5, 2019

The following questions have been posed by Commissioners prior to the scheduled Board Meeting on February 5, 2019.  Staff responses are included below, and are sorted by Agenda topic.  

Quarterly Strategic & Operational Report for Q4 2018

If we continue to have warmer winters, will that have a significant impact on our revenue as energy demand decreases during those months? Will that be offset by hotter summers? If so, is that something we are already seeing? (FAHEY)  Weather patterns and climate trends have a significant impact on customer consumption. As a winter peaking utility, historically December and January provide approximately 20% of the Electric Utility's annual revenue.Staff has been monitoring potential load impacts due to climate change for several years. In the past five years the December/January period has ranged from under 5% of the historical heating degree days (2014-15) to 95%(2016-2017). Cooling degree days in the summer have been above average in each of the last five years,although we don't expect summer peaks to approach winter peaks. The cooling load provides a partial offset for lost heating load, but loss of heating load is much more impactful to revenue. To manage weather volatility and other risks, EWEB maintains power reserves, made rate design changes to increase fixed cost recovery, and budgets conservatively by including a contribution margin risk tolerance.

Most climate change models indicate continued warmer winters and summers in our region. This may reduce winter peaks, increase summer consumption, and potentially lower hydroelectric water potential. Staff will continue to monitor the impact of climate trends and weather conditions for both retail demand and water supplies for hydro resources and update long term plans as appropriate.

Collections: It appears that we saw a 50% increase in uncollected accounts. The description states that part of the reason was due to staff working on another project. Are these funds lost or is there a chance that staff can recover them once they are back focusing on them? Did any of the changes the board make affect their ability to collect payments? (FAHEY)  In 2018 several improvements were made to the credit and collections process which helped efficiency handwork flow. Credit and collections staff worked on receivables from multiple years, including 2017. Recovery of accounts previously written off is achieved by staff through direct payment collection efforts and when a customer wishes to reinstate utility services. After EWEB staff have attempted multiple collection efforts,accounts over $100 are sent to EWEB's contracted collection agency. In 2018, recoveries of previously written off accounts totaled approximately $300,000. No changes made by the Board impacted EWEB's ability to collect payments.

EL1 Report: Many of the projects in the report are over budget, but still received a green rating. Does the green rating only cover the timing of when the project will be completed? Other than those affected by the acceleration of AMI deployment, what are the other main drivers of spend exceeding budget? (Please focus on those that exceed 10% of budget. (DAMEWOOD/PRICE/BARTON)  The green light signifies a combination of scope, schedule, and budget. Since we are not directly reporting scope or schedule metrics on the report, only budget, the light is a judgment that overall the projects are going as planned and accounting for adjustments to schedule, scope and possibly budgets. The budgets are set up approximately to 18 months prior to the work, and trued up in March/April the year of implementation. Pricing and other decisions affecting scope and budget can occur after the spring true up, such as in the case of the metering deployment. Generally, if the projects are proceeding per our direction and intent, we give them a green regardless of exact budget. We try and explain the variations in the notes. Per project comment.

Grants: What does the Springfield School District grant support? (FAHEY)  The $47,000 Springfield School District grant supports staff time for grant coordination and to provide middle school teacher classroom release time for STEM (science, technology, engineering and math) professional development, student supplies for watershed field studies and the solar challenge, as well as field trip transportation.

2019 Organizational Goals and Performance Measures (LAWSON)

I appreciate the attention given to climate change under Explicit Programs, but I'm curious as to why it's not a priority under Strategic Direction as well. I know that EWEB is a good steward of the environment, but is there a reason that we are not explicitly planning (or stating that we are planning) for resiliency under a new normal, climate-wise?  All of the goals listed contain some strategic components, which is why they rise to this level. The two explicit goals could be contained in the first goal, given policies and resolutions already exist providing policy-level guidance. You are correct, resiliency is multifaceted and recognizes the importance of delivering our vital products and circumstances under a variety of known and unknown conditions, including climate trends. Our resiliency requires financial, infrastructure, procedural, and human flexibility.

Conservation (FAHEY) - There seems to be a lot of attention given to energy conservation as it relates to climate change and affordability, but I don't see as much focus on water conservation. I know we have an abundance of water, but with changing precipitation, is this an area we should consider encouraging? I know that EWEB isn't discouraging water conservation, but it doesn't seem like it is a focus area.  EWEB has created programs and offered incentives to promote water conservation for many years. Beginning in 2018, we increased efforts to focus on water conservation and watershed protection, and have since developed additional programs and incentives. We have also increased marketing efforts to promote water programs and incentives, specifically as it relates to general water conservation, watershed protection and emergency preparedness. Existing EWEB programs and incentives include water-efficient toilet rebates, smart meter leak detection, water service line repair/replacement loans and grants, as well as septic system loans and maintenance rebates. Additionally, EWEB distributes thousands of free irrigation monitoring gauges to customers over the summer.

For additional information, please visit eweb.org:
http://www.eweb.org/residential-customers/rebates-loans-and-conservation/water-conservation-rebates
http://www.eweb.org/residential-customers/rebates-loans-and-conservation/water-conservation-loans-and-grants

CORRESPONDENCE

Limited Income Program Updates (FAHEY)

I appreciate all the work the team has done on revamping the Limited Income program. I have a question about the target goals of reducing non-payment by 50% by 2023: If EWEB maxes out efforts on level payment plans and conservation efficiency, what else is needed to meet this target? Who would we need to partner with (city, county, etc.) and are efforts underway to do so?  The Board direction we received indicated an ongoing desire to help the limited income segment of our community. As a result, we identified the four areas (utility burden, peak burden, crisis funding, and education) as the primary role we could fill as a utility to help our customers afford our services. Staff is evaluating several additional processes in an effort to assist EWEB's customer-owners who struggle financially. These include a different marketing approach for the energy efficiency education program, evaluating assistance eligibility guidelines, revising deposit procedures, and communicating with customers at risk for disconnection earlier in the process. The Customer Experience project which will provide customers self-service options and allow them to interact with EWEB at a time, and using a method, convenient for them, should mitigate the current burden of making payment arrangements during business hours. While most of these can be accomplished solely by EWEB, staff will continue to partner with other agencies providing services to at-risk community members. We will continue to monitor the program for effectiveness going forward, especially given that our entire customer base is financing the effort.

Small Cell Installations on EWEB Facilities (FAHEY/PRICE)

Is there any PR effort underway to educate the community in EWEB's (non) role in rolling out 5G? There is a lot of misconception out there about this.  There are implications to our response on this issue. Even by repeatedly saying it's not our issue, association is made between EWEB and Cell Services. So, we are continuing to gauge our response.

As you know, EWEB does not install cellular equipment, and we are merely following federal, state and city rules. Staff has developed three communication templates to respond to various audiences around the co-location of cellular antennas on utility poles, all of which describe EWEB's role in detail. These include an email response for customer/community inquiries, key messages for customer service analysts and others at EWEB, and a response for news media inquiries. The templates are attached.