Cordova Electric Cooperative

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Cordova Electric Cooperative

July 2020

Final

CORDOVA ELECTRIC COOPERATIVE, INC.

BOARD MEETING

July 22, 2020

The Regular Meeting of the Board of Directors of Cordova Electric Cooperative, Inc. was called to order at 6:00 p.m. by Chairman Pegau. Due to the COVID-19 pandemic Directors and staff have the option of participating via gotomeeting. Director Phillips and Beedle were present. Director’s Cook, Campbell, Ranney and Pegau participated via gotomeeting. Director Cooper was absent. CEO Koplin and Manager of Generation and Distribution Newlun participated in person. Manager of Administration and Finance Merritt, Executive Assistant/HR Bailer (Recorder), and Project and Technology Manager Kuntz participated via gotomeeting.

MEMBERSHIP PARTICIPATION

None

APPROVAL OF AGENDA

Phillips moved and Beedle seconded to approve the Agenda as presented. Roll call vote: Unanimous. Motion carried.

CONSENT AGENDA

Phillips moved and Beedle seconded to approve the consent agenda that includes the following:

  1. a) Minutes of Meeting of June 24, 2020
  2. b) Estate Payment
  3. c) Approve New Members 04/01/2020 – 06/30/2020

Roll call vote: Unanimous. Motion carried.

MANAGEMENT REPORTS

CEO REPORT

CEO Written Report

CEC Connection of Private Power Producers: In June I mentioned working on a “feed-in” tariff, a term used in the industry for customer-produced power “feeding in” to a utility grid. CEC does currently have provisions in our Tariff to allow these, as outlined in sections 4.7 Interconnection with Customer Owned Generation Equipment, approved in 1994 before Power Creek Hydroelectric Plant went into service. All the details of this interconnection and the associated rates, which are badly outdated and detrimental to CEC, are published in Tariff Rate Class 600 Qualifying Facilities. These are the documents that CEC staff are drafting revisions for Board consideration, under the principles of fairness to members and cost causer is cost payer.

Elevator Removal: We finally received a report on the condition of the elevator in the Illanka Clinic side of the building which indicates a safety hazard to tenants due to the advanced decay of portions of the roof and shaft walls. CEC Staff is drafting an RFP for repairs and hope to complete it soon for distribution; we were able to complete other time-critical projects in July that competed for time. We reduced the $100,000 building maintenance budget to $10,000 as part of cash flow positioning for lower revenues due to the pandemic. We will issue an RFP to get pricing to bring to the Board.

Electrify Alaska Conference (July): We are still evaluating a November 2-4 on-site conference and will make a final decision in July.

Hydro Kinetic Grant Overview: The grant overview was provided in earlier Board packets and a draft application to Department of Energy should be available soon. The deadline is July 30. This will be discussed in the PowerPoint presentation on renewables opportunities and status for Cordova as part of the CEO report.

Raging Creek Hydro Assessment: An assessment proposal with cover letter and staff recommendation are included in the packet as an action item.

Solar Grant Update: We have had two meetings with the project team and feel we are not ready for a tribal program application. However, we are starting preparations by exchanging preferred sites and partner interests. This will be discussed in the meeting PowerPoint as well.

CEO pandemic-related work time: I am now averaging about 1 hour per day of my time on pandemic items for the City of Cordova, much of which I am now conducting outside normal work hours where it will not conflict with CEC work.

Power Creek Dam Replacement: We are done with our avalanche season and are considering options for the timing for replacement of our worn-out dam.

BESS Update: The battery continues to perform well and keep us at or near 100% hydro. There are some controls issues identified as we entered our high-peaking season with greater system dynamics, and we are working through those with ABB; now merged/Hitachi (CEC featured in the press release)

BESS Funding Summary: We received $55,000 from Pacific Northwest National Laboratories. To date, we have billed PNNL $105,000 of $325,000 for a billable balance of $220,000. Sandia has been billed $420,000 of $500,000 for a billable balance of $80,000 ($80K in progress). Total to date: $525,000 of $825,000 for a billable balance of $300,000.

Orca Boiler Update: The new electric boiler is operating on excess hydro, savings are in the 1,500-3,000 gallon range per month, or $5,000-$9,000 range.

EAC Re-appointment: I was asked by the Department of Energy to serve another two-year term, this time in a leadership position as Vice Chairman of the Energy Storage Subcommittee and accepted on CEC’s behalf. The progression might be subcommittee chair next year, then a final term 2022-24.

Payroll Protection Program Loan. The PPP loan program has published the forgiveness application, and we are filling it out as we pay our eligible expenses. So far eligible expenses have been as expected which will ultimately qualify CEC for the maximum amount of forgiveness.

CEO Travel: None until further notice.

CEO Updates to Board: McMillen Feasibility Study and proposal letters for Raging Creek were circulated and added to Box. I have discussed the “feed-in” tariff above; the existing rate class 600 (attached). Training options for Credentialed Cooperative Director training is included in this packet. A renewables presentation at the July regular Board meeting will provide the Board background for strategic planning.

CEO and Board Chairman as Cooperative Spokespersons: Per staff/Board emails this month, the CEO and Board Chairmen have traditionally acted as the spokespersons for CEC. To clarify staff’s perspective and past practice, staff strives to provide the Board relevant, accurate information to share with members in their role as representatives. Official media and public announcements come from the Board Chair and/or CEO with the Chair speaking to policy and strategy (and CEO personnel) issues while CEO speaks to administration and operations. CEC policy is somewhat clear on CEO acting as a spokesperson, the Board Chair has been assumed/traditional spokesperson and CEO and Board Chair historically collaborate on how to communicate CEC issues.

Operations Update: June and July power production and line crew activities included:

  • ESS SEL-651 Recloser programming and installation
  • Power Plant breaker testing
  • New Underground down Orca Inlet Road from Orca Plant to Fleming Spit
  • Diesel Engines 3 and 7 one-revolution maintenance schedules
  • Purchased critical diesel replacement parts used in previous years
  • Tightened pandemic protocols after community cases 4th of July weekend
  • Continued daily 7 am tailboard meetings near company-wide daily call
  • Updating BESS controls for summer peaking and mode-changing improvements
  • Upgrades to Meridio mapping software and CEC Work Order process
  • Received and distributed masks from FERC & City, hand sanitizer from Barb
  • Responded to several customer requests for new services
  • Worked with ACEP on solar siting and CCMC projects with Nat’l labs and DOE
  • Working with CTC to repair powerline to Crater Lake tower
  • Started looking at alternatives for Power Creek transformer spares/backup – added to work plan
  • July production is currently about 86% of the last three even-year average; 98% hydro!

CEO Verbal Report

Koplin mentioned Jannik Kappel, who applied and was selected for the Engineering position, set up a consulting firm while waiting for the hiring process to be completed. Kappel notified Koplin that he accepted a management position at the company he was working for prior to accepting CEC’s offer. CEC’s 2020 Budget included an engineering salary for the year and with this position not being filled it frees up some funds in the Budget. Discussion on the position and budgeted amount.

Koplin said he was asked to accept another 2-year Electric Advisory Committee term, this time as the Vice Chair of the Energy Storage Subcommittee, which he accepted and which presents a good opportunity for CEC and Cordova.

Discussions ensued regarding the Feed-in Tariff, headquarters building elevator removal, and Battery Energy Storage System.

Upon question regarding the Payroll Protection Program Loan Merritt said CEC is using the funds for allowable programs.

Koplin proceeded to present his Renewable Energy Presentation and explained CEC’s various renewable options and other possible renewable options.

Administrative Reports

Merritt reviewed the following reports:

  • Financial Report for 6/30/2020
  • Revenue Report for June
  • Historical Revenue Breakdown – Supplement
  • Cash Flow Report for June
  • Cash Disbursements for June
  • Purchase Order Report
  • Generation & Sales Statistics
  • Member Disconnects

NEW BUSINESS

Policy 52C – Secondary Employment – Koplin mentioned Management recognizes some employees have secondary employment so revisions to the Policy were in order. Cook moved and Phillips seconded to adopt Policy 52C, Secondary Employment, as revised. Discussion. Beedle moved to amend the motion to include the words and/or in the Responsibility section, line three to read “…which has not been disclosed and/or which does not….” There was no second and the amended motion died. Roll call vote on the main motion: Unanimous. Motion carried.

Raging Creek Proposal – Koplin mentioned the Alaska Energy Authority suggested CEC look at Raging Creek as a hydro project and CEC took the McMillen-Jacobs geologist to look at the site. Koplin said staff recommends proceeding with this study.

Phillips moved and Campbell seconded to approve the Raging Creek Feasibility Cost Estimate to McMillen-Jacobs for a not to exceed amount of $55,040. Discussion on how project could bring CEC to 100% renewable energy, this project over other suggested projects, and storage options. Ranney said he would like the Board to go through the Strategic Plan before going on with future studies. Discussion.

Roll call vote: 5 – Nay, 1 – Yea (Campbell). Motion failed.

UNFINISHED BUSINESS

Board Evaluation – Review for 2nd Quarter – Board reviewed and updated.

INFORMATION ITEMS

CEO Travel – noted

Board Attendance at Regular Meetings – noted

Board Training- noted

Class of 2020 Safe & Sober Thank You Card – noted

OTHER ITEMS

Policy Review:

  • Policy #62 – Whistleblower Policy
  • Policy #64 – Information Security Program

Phillips said he would like more time to review these policies and Ranney agreed. Board directed staff to include these two policies on the August Agenda for review.

EXECUTIVE SESSION – none needed

PENDING AGENDA

  • Review Board Evaluation Quarterly (January/April/July/October)

BOARD PENDING EVENTS CALENDAR

Noted

SUMMARY OF BOARD DIRECTION TO CEO

  • Email Tariff section 600 to Board
  • Strategic Plan on August agenda
  • Equity Management Plan on August agenda
  • Circulate Existing Member Outreach Plan / Communication Strategy to Board
  • Add Policy 62 and 64 to August agenda
  • Include feed-in Tariff on September agenda

BOARD COMMENTS

Beedle – Thanked everyone for all the work done.

Phillips – Thank you Clay and staff for another informative meeting. Thank you to the Board.

Campbell – Thanked everyone.

Ranney – There is a very talented group of employees at CEC. He would like staff to look at the options presented and possibly new opportunities for Strategic Planning.

Cook – The Alaska Power Association (APA) meeting will not be in Homer this year due to the COVID pandemic but will be held virtually in November. APA was hit hard with less income this year and is looking for ways to make money. Good meeting.

Pegau – Thanks all for another good meeting. He is looking forward to Strategic Planning.

Phillips moved and Ranney seconded to adjourn at 8:10 p.m.

Date Approved Secretary/Treasurer

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