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WELCOME TO OUR CITY COUNCIL SPECIAL SESSION.
TODAY, WE WILL BE BRIEFED, UH, BY C P SS ENERGY ON A NUMBER OF TOPICS.
THE TIME IS 1:05 PM ON THE FIRST DAY OF JUNE, 2023.
WE'LL CALL OUR SPECIAL MEETING TO ORDER.
UM, MADAM CLERK, COULD YOU READ THE ROLE? COUNCIL MEMBER BRAVO HERE.
COUNCIL MEMBER MCKEE RODRIGUEZ.
COUNCIL MEMBER COURAGE PRESENT.
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AGAIN, EVERYONE.UH, WE HAVE A SPECIAL MEETING TODAY, UH, FOR, TO BE BRIEFED BY C P S ENERGY STAFF.
UH, SO, UH, ERIC, DID YOU WANNA KICK US OFF OR DO YOU WANT ME TO BRING RUDY UP? UH, NO, JUST, UH, LET'S KICK IT OVER TO RUDY.
THERE'S THREE PRESENTATIONS, MAYOR, ON THREE DIFFERENT TOPICS, AND SO I WOULD SUGGEST THAT WE JUST GO THROUGH ALL OF THEM AND RUDY WILL INTRODUCE US.
UH, I JUST WANT TO KICK THIS OFF BY, UH, THANKING, UH, ERIC AND, UH, STAFF ARE THE INVITE OVER TODAY.
UH, WHAT WE'RE TRYING TO DO TODAY IS JUST KIND OF CLOSE THE LOOP ON A FEW ISSUES, UH, THAT, UH, WE KNOW ARE KIND OF OUTSTANDING WITH COUNCIL.
UH, I THINK WE'VE BEEN, YOU KNOW, HAVING SOME REALLY GREAT, UH, BRIEFING SESSIONS WITH THE M U C, UH, OVER THE LAST COUPLE OF MONTHS.
THEY'VE BEEN BRIEFED ON A COUPLE OF THESE.
SO, UH, WE'RE GONNA BE PROVIDING THE FULL COUNSEL, UH, WITH THE SAME UPDATES, AND THEN ONE ADDITIONAL THAT'S COME THROUGH HERE RECENTLY ON THE OVERHEAD TO UNDERGROUND.
SO, WITH THAT, I'M GONNA TURN IT OVER TO SHANNON RAMIREZ, UH, WHO'S, UH, MY CHIEF LEGAL OFFICER TO WALK YOU THROUGH OUR, UH, OPERATIONAL EFFICIENCY REVIEW THAT WE DID.
UM, I'M GOING TO VERY QUICKLY, UM, WALK THROUGH THE AGENDA.
UM, THIS IS REALLY AN OVERVIEW OF THE OPERATIONAL EFFICIENCY REVIEW.
UH, JUST AS A REMINDER, THAT IS THE THIRD PARTY REVIEW THAT OUR BOARD INSTRUCTED US TO GO THROUGH LAST YEAR.
UM, I WANT TO, UH, TALK ABOUT WHAT THEY FOUND AND WHAT OUR APPROACHES TO THEIR RECOMMENDATIONS.
JUST TO GIVE YOU AN IDEA OF WHAT ALL WAS INCLUDED IN THE OVERVIEW.
UM, WE SAID WE WERE GONNA GO OUT AND, UM, COMPETITIVELY BID THE PROCESS.
WE SELECTED GALLUP AND DAYMARK TO DO THAT EXTERNAL REVIEW, AND THEY LOOKED AT A NUMBER OF AREAS THAT INCLUDED, UM, CULTURE AND VALUES, LEADERSHIP AND COMMUNICATIONS OPERATIONS, FINANCIAL HEALTH, CUSTOMER ENGAGEMENT, AND OUR E R P TRANSITION.
UM, AFTER TAKING A LOOK AT ALL OF THOSE AREAS, THEY RETURNED TO US A SERIES OF OBSERVATIONS OF GAPS THEY NOTICED AND RECOMMENDATIONS TO CLOSE THOSE GAPS.
ONE OF THE MAIN REASONS THAT WE'RE HERE TODAY IS TO WALK YOU THROUGH WHAT OUR APPROACH IS TO TAKE THE FEEDBACK THAT WE RECEIVED FROM THAT THIRD PARTY REVIEW AND PUT IT INTO PRACTICE AT C P S ENERGY.
OUR FIRST STEP THAT WE TOOK WAS TO PUT TOGETHER A CROSS FUNCTIONAL TEAM.
UM, I TELL YOU THIS, TO LET YOU KNOW THAT THIS REALLY HAD, UM, RESULTS THAT IMPACTED EVERY PART OF THE ORGANIZATION.
I CAN'T THINK OF A BUSINESS UNIT THAT DIDN'T GET SOME FEEDBACK ABOUT WAYS THAT WE COULD IMPROVE, UM, OUR OPERATIONS IN TERMS OF, UM, HOW WE INCORPORATE THAT FEEDBACK.
WE ARE NOT CREATING A STANDALONE MITIGATION PLAN.
WHAT WE'RE DOING IS REALLY INTEGRATING THOSE FINDINGS INTO ALL OF THE PLANS THAT WE HAVE AS A BUSINESS.
SO, FOR INSTANCE, WE ARE INCORPORATING THOSE INTO OUR STRATEGIC PLAN, OUR ORGANIZATIONAL GOALS, AND ALL OF THE MEASURES THAT WE USE TO DRIVE OUR BUSINESS PRACTICES.
WE HAVE, UM, INCORPORATED THESE INTO OUR OPERATIONAL PLANS AND ALREADY BEGUN TO EXECUTE AGAINST A LOT OF THOSE RECOMMENDATIONS.
WE HAVE ALSO, UM, COMMITTED OURSELVES TO COMING TO THE BOARD AND PROVIDING PERIODIC UPDATES ON OUR PROGRESS SO THAT YOU CAN BE ASSURED THAT OUR TRUSTEES KNOW THAT THEY ARE BOTH UNDERSTANDING HOW TO MEASURE THE PROGRESS AND MAKING SURE THAT WE MEET THOSE OBLIGATIONS.
I WANNA TAKE A LOOK AT SOME OF THE KEY RISK AND RECOMMENDATIONS THAT THEY REALLY CAME UP WITH FOR THE ENTIRE ORGANIZATION.
THE TECHNOLOGY TRANSITION THAT WE HAVE TALKED ABOUT A NUMBER OF TIMES BEFORE YOU ALL IS REALLY IMPORTANT FOR A PROJECT OF THIS, UM, SIZE, SCOPE, AND COMPLEXITY.
WE KNOW THAT THERE ARE A LOT OF RISKS IN PUTTING THAT INTO PRACTICE.
SO ONE OF THE THINGS THEY IDENTIFIED AS A RISK, UM, IS EXECUTING AGAINST THAT PLAN, NOTING THAT THE PLAN IS ABSOLUTELY NECESSARY, BUT IT IS HIGH RISK AND IT'S RESOURCE INTENSIVE.
ONE OF THE OTHER RISKS THEY IDENTIFIED IS OUR SHORT-TERM RESOURCE CONSTRAINTS.
THE DEMANDS ON OUR STAFF AS WE TRANSITION ONE TECHNOLOGY PLATFORM TO ANOTHER ARE GOING TO BE TREMENDOUS, AND WE'RE GONNA HAVE TO TAKE THAT INTO
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ACCOUNT AS A, AS WE PLAN TO MEET ALL OF OUR OBLIGATIONS OVER THE NEXT FEW YEARS.MAINTAINING STAFFING GOALS IS GONNA BE ABSOLUTELY CRITICAL FOR US IN TERMS OF THE LONG-TERM FINANCIAL SUSTAINABILITY OF THE COMPANY.
UH, ONE OF THE KEY THINGS THAT THEY NOTED IS THAT THE REALITY FOR C P S ENERGY IS THAT OUR COSTS ARE INCREASING.
WE ARE GOING TO HAVE TO CONSIDER THAT FACT.
WE'RE GOING TO HAVE TO CONSIDER IT AS WE, UM, LISTEN TO OUR CUSTOMERS AND THEY, WHAT THEY WANT IN TERMS OF CONTINUING THE RELIABLE SERVICE THAT WE HAVE RIGHT NOW, AND HOW WE DO THAT FOR A COMMUNITY THAT IS GROWING SO QUICKLY.
SO WE'RE PREPARING FOR THOSE INCREASED COSTS IN TERMS OF RECOMMENDATIONS AND HOW TO MOVE FORWARD.
ONE OF THE CRITICAL THINGS THEY NOTICE, THEY NOTICE FOR US IS THAT, UM, WE ABSOLUTELY HAVE TO BALANCE THE RISK OF OUR END OF LIFE SYSTEMS WITH THE RISK OF MANAGING THE EXECUTION OF THAT TRANS, OF THAT TRANSITION.
UM, I SAY THAT IT SEEMS REALLY SIMPLE AND IT IS REALLY STRAIGHTFORWARD, BUT IT IS NOT GOING TO BE EASY AT ALL.
UM, WE SIMPLY HAVE TO BE ABLE TO BE VERY AGILE IN THE PROCESS, HAVE A LOT OF CONTINGENCY PLANS, AND UNDERSTAND THAT EXECUTING AGAINST A COMPLEX LARGE PROCESS LIKE THIS REQUIRES US TO BE ABLE TO ACCOUNT FOR WHEN THINGS JUST DON'T GO AS PLANNED.
THE OTHER RECOMMENDATION THAT THEY MADE WAS PRIORITIZING, UM, ATTRACTING, RETAINING AND UPSKILLING OUR WORKERS.
UM, THIS IS SOMETHING THAT I ACTUALLY AM PERSONALLY PROUD OF.
I THINK C P S ENERGY HAS HAD A FANTASTIC HISTORY OF DOING THAT FOR ITS WORKERS, BUT WE'VE GOTTA FIGURE OUT A WAY TO CONTINUE DOING THAT.
LASTLY, WHAT THEY SUGGESTED IS THAT WE WORK WITH THE BOARD TO DEVELOP, UM, REAL SCENARIOS AND CONTINGENCIES TO SHOW THAT AGILITY THAT I SPOKE ABOUT BEFORE.
PLANS FOR IMPLEMENTATION OF VISION 2027 CANNOT BE A SINGLE PLAN.
WE HAVE GOT TO HAVE A NUMBER OF DIFFERENT PLANS IN CASE THINGS GO, UM, DIFFERENT WAYS.
WE'VE GOTTA BE FLEXIBLE AND WE'VE GOTTA SHIFT QUICKLY AS OUR OPERATIONS DEMAND.
I'M GONNA GO THROUGH SOME OF THE KEY, UM, FINDINGS THAT THEY HAD IN SPECIFIC AREAS.
I DON'T WANNA READ YOU ALL THESE SLIDES BECAUSE I FIND THAT TO BE REALLY BORING AND I TRUST THAT ALL OF YOU ARE REALLY GREAT READERS.
UM, SO I'M GONNA SUMMARIZE THEM AS WE GO THROUGH.
UM, I THINK THIS ONE AT THE TOP, UM, IS SOMETHING THAT WE HAVE HAD A LOT OF DISCUSSION ABOUT.
C P S ENERGY IS IN A SUSTAINABLE FINANCIAL POSITION WITH ITS DEBT CAPITALIZATION RATIO, AND IT'S FAVORABLY COMPARABLE TO OUR PEER UTILITIES.
TO ME, I THINK THAT THAT IS IMPORTANT TO UNDERSTAND CONSIDERING OUR RECENT HISTORY OVER THE PAST COUPLE OF YEARS IN OUR COMMUNITY AND THE NUMBER OF EVENTS WE'VE BEEN THROUGH.
C P S ENERGY SHOULD CONTINUE THOUGH, TO WORK VERY ACTIVELY WITH ITS BOARD, UM, TO ENSURE THAT WE CONTINUE OUR EFFORTS IN THIS AREA.
UM, I ALSO THINK, UM, YOU KNOW, IT WAS IMPORTANT TO NOTE THAT, UM, IF NECESSARY, WE'RE GOING TO HAVE TO ADDRESS OUR OVERDUE CUSTOMER BALANCES IN OUR REQUEST FOR RATE INCREASES AS WE GO FORWARD, IF IT CONTINUES, AND IF OUR CURRENT PLANS THAT ARE ACTIVELY IN PLACE TO REDUCE THAT DEBT AREN'T SUCCESSFUL.
THE NEXT POINT IS REALLY ON OUR TECHNOLOGY CHALLENGES.
UM, I WENT THROUGH THIS, YOU KNOW, IN DEPTH FOR THE ORGANIZATION, BUT IT APPLIES IN THE FINANCIAL HEALTH AREA AS WELL.
THEY NOTED THAT SOME OF OUR TECHNOLOGY LIMITATIONS SIMPLY DON'T ALLOW US TO BE AS EFFICIENT AS POSSIBLE IN TERMS OF OUR OPERATIONS AND IN TERMS OF EXECUTING AGAINST THE CONTROLS WE NEED IN OUR SYSTEMS. SO, UM, I THINK A LOT OF THAT IS BECAUSE OUR PROCESSES ARE MANUAL AND A LOT OF 'EM ARE DECENTRALIZED.
THE NEXT AREA THAT THEY MADE KEY RECOMMENDATIONS ON ARE OUR ELECTRIC OPERATIONS.
THEY ENCOURAGED US TO REALLY USE CIRCUIT LEVEL AND ROOT CAUSE, UM, TYPE ANALYSIS TO REFINE OUR INVESTMENT STRATEGIES, TO REFINE OUR, UM, O AND M STRATEGIES AND TO DOCUMENT THOSE.
UM, SOME OF THE LIMITATIONS WE HAVE RIGHT NOW HERE ARE BECAUSE OF THE LIMITATIONS WITH OUR TECHNOLOGY PLATFORM.
WHEN I'M TALKING ABOUT THIS, I'M SPECIFICALLY TALKING ABOUT OUR OPERATIONAL TECHNOLOGY THAT'S PART OF THAT OVERALL DIGITAL UPGRADE, BUT THEY CONSTRAIN US SOMEWHAT HERE.
THEY ALSO ADVISE THAT WE UNDERTAKE, UM, ANALYSIS OF OUR CONTRACTED RESOURCE USAGE.
UM, THERE IS A, THERE IS A CONSTANT SHIFT IN EVALUATION OF WHETHER OR NOT THE WAY WE ARE USING CONTRACTED LABOR REMAINS EFFICIENT.
THE NEXT IS RE THE NEXT RECOMMENDATION REALLY IS, UM, LOOKING AT KEY METRICS THAT TRACK THE ACHIEVEMENT OF THE BENEFITS THAT WE ARE TELLING FOLKS ARE GOING TO OCCUR BECAUSE WE MAKE THESE UPGRADES.
UM, IF I SAY TO YOU, LET'S MAKE OUR OPERATIONAL TECHNOLOGY MORE EFFICIENT TO THE LAY PERSON, THAT IS VERY HARD TO UNDERSTAND HOW WE'RE MAKING PROGRESS.
SO THE ENCOURAGEMENT WAS TO MAKE GOALS THAT ARE ACTUALLY EASIER TO, UM, MEASURE THE PROGRESS ON IN A WAY THAT'S MEANINGFUL TO BOTH OUR CUSTOMERS AND TO OUR STAKEHOLDERS.
UH, THEY ENCOURAGE US TO, AGAIN, RESOLVE TECHNOLOGY BARRIERS.
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IS A SIGNIFICANT PART OF THE UPGRADE TO OUR OPERATIONAL TECHNOLOGY.THEY ALSO ENCOURAGE US TO REALLY BE CLEAR ABOUT THE ALLOCATION OF RESOURCES BETWEEN WHAT I ALWAYS THINK OF AS OUR RUN THE BUSINESS INVESTMENT AND NEEDS, AND OUR SPECIAL PROJECT INVESTMENT AND NEEDS, UM, A CONSTANT LOOK BACK AT THOSE TO MAKE SURE THAT THE ALLOCATION OF RESOURCES IS PROPERLY ALIGNED THERE.
AND LAST IN TERMS OF THE KEY RECOMMENDATIONS FOR THE ELECTRIC OPERATION, IS TO MAKE SURE THAT, UM, OUR STAFF WHO ARE ACTIVELY ENGAGED WITH OUR ERCOT STAKEHOLDERS REMAIN THAT WAY AND MAKE SURE THAT WE ARE DOING SO IN A WAY THAT ENHANCES OUR INTERNAL PROCESSES AND REALIZES THE FULL POTENTIAL OF THE BENEFITS THAT WE'RE, THAT WE'RE GETTING HERE.
UM, I THINK OF THIS REALLY IS, UM, ENSURE THAT OUR INTERNAL PROCESSES EVOLVE AT THE SAME PACE AS OUR TECHNOLOGY PROCESS ARE EVOLVING THROUGH THESE UPGRADES.
UH, REALLY TO GET THE MOST BENEFIT OUT OF ALL OF THAT, I'M GONNA LOOK NEXT AT THE KEY RECOMMENDATIONS FOR GAS.
UM, THE FIRST ONE, UM, IS REALLY JUST TO CONSOLIDATE WHAT WE HAVE IN A BUNCH OF DIFFERENT AREAS INTO A SINGLE PLACE FOR OUR WINTER SEASON MANAGEMENT.
UM, THEY SUGGESTED PUTTING IN, UM, IN TERMS OF OUR INVESTMENT, UM, STRATEGIES FOR THE GAS AREA IN TERMS OF OUR PRACTICES AND PROCEDURES AND SOME OF THE REPORTING JUST TO CONSOLIDATE THAT INTO A SINGLE PLACE.
THEY ALSO ENCOURAGED A METRIC THAT IS DIFFERENT THAN WHAT WE USE RIGHT NOW TO TRACK GAS LEAKS.
THAT REALLY FOCUSES ON BEING ABLE TO LOOK AT, AT THE END OF THE YEAR WHAT GAS LEAKS REMAIN OPEN FOR LONGER THAN 45 DAYS.
SO, UM, WE TRACK A NUMBER OF THOSE THROUGH THE TEXAS RAILROAD COMMISSION.
THERE'S NOT ONE THAT SPECIFICALLY TRACKS IN THAT MANNER, BUT THEY SUGGESTED THAT THAT WAS A, AN ESPECIALLY GOOD ONE TO USE.
THEY ENCOURAGED, UM, INVESTING IN ADDITIONAL STAFF FOR OUR GAS DIVISION, AND THEY ENCOURAGED US TO DO SOMETHING THAT WE ARE ALREADY WORKING ON, BUT TO DO IT MORE VIGOROUSLY.
AND THAT IS DEVELOP TO DEVELOP, UM, WORKING PARTNERSHIPS WITH WORKFORCE ORGANIZATIONS AND PARTNERS SO THAT WE CAN HAVE AN IN-HOUSE TRAINING PROGRAM THAT ALLOWS US TO REALLY EFFECTIVELY RECRUIT AND RETAIN YOUNG WORKERS.
THE LAST AREA THAT HAD, UM, RECOMMENDATIONS I'M GONNA GO THROUGH SPECIFICALLY IS CUSTOMER ENGAGEMENT.
THEY ASKED TO LOOK AT A, A THREE TO FIVE YEAR PLAN THAT REALLY IS A COMPREHENSIVE LOOK AT CUSTOMER ENGAGEMENT, BUDGETING, STAFFING, AND DATA GATHERING IMPROVEMENTS.
SO WE'VE ALREADY STARTED THERE.
THEY ASKED US TO COMMIT, UM, SPECIFICALLY TO E R P SPECIFICATIONS THAT SUPPORT THE THINGS THAT WE NEED TO DO THAT SO THAT IMPROVE, UM, DATA GATHERING, STORAGE AND ANALYTICS FOR THAT PURPOSE.
AND LASTLY, THEY, UM, ENCOURAGE US TO REWORK THE CUSTOMER SURVEY, AND THAT ALLOWED FOR MORE CUSTOMER SEGMENTATION OVERALL.
THERE WERE SOME COMMON THEMES, UM, THAT WE SAW IN THE IDENTIFICATIONS, UM, OF THE GAPS AND THE MITIGATION MEASURES.
ALL OF THEM, I THINK OF AS COMMON THREADS FOR ADVANCING OUR VISION 2027.
SO I WANTED TO REITERATE THOSE TO YOU.
UM, OUR CURRENT SYSTEM UPGRADES ARE ABSOLUTELY ESSENTIAL TO CONTINUING TO PROVIDE THE LEVEL OF SERVICE THAT WE NEED TO, TO OUR COMMUNITY.
THE SYSTEMS AND UPGRADES ARE GOING TO REQUIRE RATE, SUPPORT, RATE INCREASES, AND SUPPORT FROM OUR COMMUNITY, AND HAVING SUFFICIENT QUALIFIED EMPLOYEES TO EXECUTE AGAINST ALL OF THESE ASKS ARE ABSOLUTELY ESSENTIAL.
THAT IS THE END OF MY PREPARED REMARKS, BUT I'D BE HAPPY TO ANSWER ANY QUESTIONS THAT YOU ALL HAVE.
I THINK WE'LL GO THROUGH THE THREE PRESENTATIONS AND THEN WE'LL DO QUESTIONS ALL AT ONCE.
COUNSEL, UH, THANK YOU FOR THE OPPORTUNITY TO PRESENT TO YOU TODAY.
SO TODAY I'M JOINED BY MY COLLEAGUE FROM BLACK AND BEACH, MR. JIM SHIELDS, WHO WILL, UH, JOIN ME IN A LITTLE BIT TO, UM, UH, PRESENT OR HELP ME PRESENT, UM, UH, ONE OF OUR RELIABILITY IMPROVEMENT STRATEGIES, WHICH IS SPECIFICALLY LOOKING AT UNDERGROUNDING, UH, ELECTRIC FACILITIES.
SO, MR. SHIELDS IS GONNA GIVE US A BROADER INDUSTRY-WIDE PERSPECTIVE, WHICH INCLUDES INSIGHTS FROM IOUS.
UH, THAT'S NOT US, OF COURSE, WE'RE A MUNICIPALITY.
BUT, UH, IT DOES ALLOW US TO DO COMPARISONS, UH, BEYOND OUR, OUR, THE EDGES OF OUR TERRITORY.
THEN I'LL COME BACK AND I'LL GIVE YOU SPECIFIC INFORMATION AND DETAILS ON OUR PROGRAMS HERE AT C P S ENERGY.
SO WITH THAT, I'M GONNA TURN IT OVER TO MR. SHIELDS.
MR. MAYOR COUNCIL, THANKS FOR THE OPPORTUNITY TO PRESENT TODAY.
UM, WE'VE BEEN ASKED TO KIND OF TAKE AN OVERVIEW OF THIS PRACTICE AROUND CONVERTING OVERHEAD LINES TO, AND
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THEN BURYING 'EM TO UNDERGROUND.AND SO, UH, JUST A FEW SLIDES HERE TO, TO WALK THROUGH THAT.
I WANTED TO START OUT WITH A, UM, SORT OF A SUMMARY.
UM, THE CHANGING CONDITIONS, RIGHT? THERE'S MORE EXTREME WEATHER CONDITIONS, AND THAT'S TRYING TO DRIVE THE NEED TO, UM, TO MITIGATE THE EFFECTS OF, YOU KNOW, THAT INCLEMENT WEATHER AND, UM, YOU KNOW, THE DURATION OF OUTAGES ASSOCIATED WITH THAT.
SO THERE'S A DRIVING NEED FOR IT.
UM, THERE IS SOME LEGISLATIVE SUPPORT ACROSS THE NATION, UH, ALONG THAT AS WELL.
UM, AND WE SEE THAT IN MANY JURISDICTIONS WHERE THERE'S RECOVERY MECHANISMS ASSOCIATED WITH, UM, RESILIENCY AND GRIN HARDENING.
AND, AND A GOOD PORTION OF THAT IS, IS ASSOCIATED WITH UNDERGROUNDING LINES.
UM, HOWEVER, THERE'S A BALANCE HERE, RIGHT? UM, IT IS MORE COSTLY TO BURY LINES.
AND SO, UM, WE'RE TRYING TO STRIKE THAT BALANCE BETWEEN COST AND EFFECTIVENESS.
UH, THERE'VE BEEN A COUPLE STUDIES.
ONE WE CITE HERE THAT, UM, YOU KNOW, WHEN WE LOOK AT THE ENTIRE GRID, UM, IF YOU LOOK AT WHOLESALING, UH, THE CONVERSION FROM OVERHEAD TO UNDERGROUND, UM, THE ECONOMICS REALLY DON'T WORK OUT.
AND SO WHAT WE SEE IN THE INDUSTRY IS IF AS A BEST PRACTICE IS TARGETED UNDERGROUNDING AND, UM, WHERE YOU REALLY TAKE A LOOK AT, WELL, THE SOURCES OF THE OUTAGES AND WHERE THEY'RE AT, AND, AND TARGET THOSE LOCATIONS.
SO IN SUMMARY, THAT'S, THAT'S KIND OF WHERE WE'RE AT FROM AN INDUSTRY PERSPECTIVE.
UM, THERE ARE A COUPLE DRIVERS HERE.
UM, YOU KNOW, THESE ARE THE FOUR MAIN DRIVERS.
AND IN PARTICULAR, UM, JUST WANNA NOTE HERE THAT FROM A COST PERSPECTIVE, UM, MORE COST EFFECTIVE TO BUILD, YOU KNOW, THE THREE PHASE MAIN LINE OVERHEAD, UH, UM, OVERHEAD, RIGHT? UM, AND THEN, UM, BUT THERE IS A DOWNSIDE, RIGHT? IT, IT'S EXPOSURE TO THE INCLEMENT WEATHER AND IT, IT TAKES RESOURCES AND TIME TO, TO PUT THAT BACK UP WHEN IT, WHEN THEY COME DOWN.
AND THEN, UM, YOU KNOW, SOME OF THE DOWNSIDES OF THE OVERHEAD PIECE IS, OF COURSE, WIDESPREAD OUTAGES, UH, DURING INCLEMENT WEATHER, UH, THE COSTS FOR RESTORATION.
AND THERE IS A PUBLIC SAFETY PORTION OF THAT TOO, RIGHT? WHEN WE'VE GOT FACILITIES LAYING ON THE GROUND, UH, THERE'S A, A SAFETY PORTION OF THAT.
BUT THE FOUR MAIN DRIVERS I LISTED HERE, RELIABILITY, OPERATING COST, SAFETY, AND, UM, FROM A CUSTOMER SATISFACTION PER PERSPECTIVE, WE'RE ROLLING IN THERE.
UM, YOU KNOW, AESTHETICS AND RELIABILITY AS WELL.
SO, JUST A LITTLE DEEPER DIVE IN HERE.
UM, WE'VE TOUCHED ON THE RELIABILITY PIECE.
UH, JUST WANTED TO, UM, ILLUSTRATE HERE THE OPERATING COST, RIGHT? THERE'S, UM, YOU KNOW, THERE IS NO, THERE'S SMALLER AMOUNTS OF RESTORATION COSTS.
IF IT'S UNDERGROUND, TYPICALLY THE INCLEMENT WEATHER DOESN'T TOUCH THAT.
UM, THE DOWNSIDE IS IT'S MORE EXPENSIVE TO INSTALL.
SO THERE'S A BALANCE, UH, THAT NEEDS TO BE REACHED THERE.
UM, ONE NOTE HERE ON, ON EASEMENT.
THIS IS MORE AROUND LAND RIGHTS THAN ANYTHING ELSE.
YOU NEED A, A SMALLER EASEMENT TO PUT IN OVERHEAD.
UM, YOU NEED A MARGINALLY LARGER, UH, EASEMENT TO, TO BURY UNDERGROUND JUST BECAUSE OF THE, THE FACILITY TYPES.
UM, AND THEN ON THE CUSTOMER SATISFACTION PIECE, UM, JUST WANTED TO NOTE HERE ON IMPROVING AESTHETICS, UM, THAT, THAT NEEDS TO TAKE INTO CONSIDERATION THE TELECOM PIECE OF, OF WHAT'S ON OUR OVERHEAD WOOD POLES AS WELL.
AND, UM, FROM A COST PERSPECTIVE, YOU KNOW, IT IS A LITTLE HIGHER TO, TO BURY THE FACILITIES.
UM, I WANNA NOTE HERE A COUPLE THINGS ON PUBLIC SAFETY.
UH, ALSO, UM, YOU'VE PROBABLY HEARD IN THE NEWS, UM, AROUND THE WILDFIRE PIECE, AND IT'S UNIQUE TO CERTAIN AREAS OF THE COUNTRY.
UH, AND THOSE ARE TARGETED PROGRAMS TO HELP MITIGATE THAT.
AND THEN ALSO, UM, FROM A, UH, PUBLIC SAFETY PERSPECTIVE, OVERHEAD LINES, UM, YOU KNOW, THEY, THEY ARE ENERGIZED AND THEY'RE HIGHER ON THE POLE.
UH, YOU STILL CAN COME IN CONTACT WITH THOSE.
UH, THERE'S RULES AND REGULATIONS AROUND THAT FROM A NATIONAL ELECTRIC SAFETY CO PERSPECTIVE, BUT THERE IS THAT EXPOSURE.
UM, I HAD MENTIONED THAT THE BEST PRACTICE WITHIN THE INDUSTRY IS AROUND TARGETING CERTAIN AREAS OF CIRCUITS FOR UNDERGROUNDING.
AND THERE'S A SET OF CRITERIA THAT, THAT WE SEE, UM, WIDELY USED ACROSS THE INDUSTRY.
I WANNA START OUT WITH OUTAGE FREQUENCY AND OUTAGE DURATION FIRST, RIGHT? UM, FROM AN OUTAGE FREQUENCY PERSPECTIVE, UM, EVERY TIME THERE'S AN OUTAGE, UM, WE GOTTA SEND CREWS, WE GOTTA GET MATERIAL OUT THERE SOMETIMES.
AND THE MORE WE DO THAT, IT'S, MOST OF THAT'S OPERATIONAL COST.
UH, THERE IS A LITTLE BIT OF CAPITAL COST IN THAT.
UM, AND SO THAT DIRECTS WHERE FUNDING WOULD BE, UM, SUPPORTED, UH, FOR UNDERGROUNDING, UH, THE DURATION AS WELL, RIGHT? A LOT OF THESE CASES, UM, ARE IN REALLY BAD TERRAIN.
UM, THEY'RE SORT OF DANGEROUS TO GET TO, UH, ESPECIALLY DURING INCLEMENT WEATHER AND, UM, YOU KNOW, AT NIGHT A LOT OF THE TIMES.
SO, UM, IF WE TAKE THOSE FACTORS,
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UH, AND HELP LET THOSE DIRECT WHERE WE, UH, FUND BEARING FROM OVERHEAD UNDERGROUND IS ONE OF THE CRITERIA.OF COURSE, THE LENGTH OF LINE IS, IS PART OF THAT AS WELL.
UM, YOU KNOW, THE LENGTH OF LINE, THE NUMBER OF CUSTOMERS SERVED, UM, ALL PLAY INTO THAT.
AND, UM, ALSO FROM A PUBLIC SAFETY PERSPECTIVE, UM, YOU KNOW, WHEN WE TALK ABOUT, UH, VEHICLE ACCIDENTS AND THINGS, UM, THAT COULD BE REDUCED, UH, WITHOUT HAVING THE OVERHEAD LINES, UH, WE JUST HAD A COUPLE EXAMPLES HERE.
UM, THE FIRST THREE HERE ARE DOMINION, DUKE, AND A E P.
AND THESE ARE REALLY TARGETED PROGRAMS. UM, THEY'RE WELL ESTABLISHED, THEY'VE GOT A SET OF CRITERIA THEY GO THROUGH AND, UM, CANDIDATE PROJECTS ARE, UH, PROPOSED, AND THEN THEY'RE RAN THROUGH THIS CRITERIA.
AND THEN FUNDING'S AVAILABLE FOR THOSE, UM, SECTIONS OF LINE THAT ARE, UH, CHOSEN FOR UNDERGROUNDING.
AND THE PG E IS, UM, THE EXAMPLE WE HAVE THERE IS, IS, IS REALLY A, UM, AN OPTION WHERE, UH, COMMUNITIES, UM, THAT HAVE HIGH, UM, TRAFFIC AREA OR FOR BEAUTIFICATION REASONS, THEY CAN GO AHEAD AND UNDERGROUND THAT, AND THAT THE COST OF THAT IS ROLLED INTO, INTO THE RATE BASE.
THE OTHER TWO OPTIONS THERE ARE REALLY CUSTOMER FUNDED OR DEVELOPMENT FUNDED.
UH, JUST WANTED TO LEAVE YOU OF THESE TWO, UM, MAJOR PROGRAMS THAT, THAT YOU MAY HAVE HEARD OF.
UH, THE PACIFIC GAS ELECTRIC ONE, UH, THEY PLAN ON BURY 10,000 MILES OF UNDERGROUND, UM, AT A COST OF ABOUT THREE AND THREE QUARTERS MILLION PER MILE.
UM, AND THAT'S MORE OF A WHOLESALE, UH, IT IS SOMEWHAT TARGETED IN THE SENSE THAT THEY'RE TARGETING AREAS THAT ARE MORE SUSCEPTIBLE TO WILDFIRES.
OF COURSE, ENTERGY, UH, LOUISIANA AND FLORIDA POWER LIGHT, THEY'RE IN THE HURRICANE ZONE.
AND SO, UM, THEY HAVE PLANS IN FRONT OF THEIR COMMISSIONS, UM, TO DO SOME RESILIENCY AND HARDENING OF THEIR SYSTEM.
AND, AND GOOD PORTIONS OF THAT IS, IS BEARING, UH, UH, OVERHEAD FACILITIES.
SO, UM, WITH THAT, I THINK I'LL TURN IT BACK OVER TO RICK AND, UH, HE'LL GO THROUGH THE C P S ENERGY PROGRAMS. THANK YOU.
OKAY, SO, UM, I'M GONNA SPEND SOME TIME TALKING ABOUT C P S SPECIFIC, UM, UH, UH, INFRASTRUCTURE.
UH, SO JUST A LITTLE BIT OF BACKGROUND.
UH, SO OUR DISTRIBUTION ELECTRIC SYSTEM HAS ABOUT 15,000 TOTAL MILES.
UM, AND, AND MOST OF IT IS OVERHEAD.
ABOUT 55% OF IT IS, UH, BUT THE GAP IS SHRINKING EVERY YEAR.
SO, UM, THE, OUR DISTRIBUTION SYSTEM GROWS AT ABOUT 300 MILES PER YEAR.
AND, UH, AT LEAST 250 OF THOSE MILES ARE MADE UP BY UNDERGROUND ALONE.
AND THAT'S PRIMARILY DRIVEN BY OUR, OUR RESIDENTIAL DEVELOPMENTS.
ALL SUBDIVISIONS ARE UNDERGROUND.
UM, NOW ON THIS SLIDE, WE HAVE A COUPLE OF, UM, UH, WHAT WE IDENTIFY THE DIFFERENT UNDERGROUND STRATEGIES THAT WE HAVE.
SYSTEM IMPROVEMENT IS REALLY FOR, UH, ACCOMMODATING GROWTH, NEW SUBSTATIONS, ET CETERA.
UH, OUR U R D PROGRAM TARGETS, UH, THE REPLACEMENT OF 50 YEAR OLD DIRECT BURIED CABLE, ALSO IN OUR RESIDENCE, UH, RESIDENTIAL DEVELOPMENTS, SUBDIVISIONS.
UH, BUT THE PROGRAM THAT I WANNA HIGHLIGHT IS OUR STRATEGIC UNDERGROUNDING, WHICH IS SOLELY BASED ON RELIABILITY DRIVEN METRICS.
SO IT'S A DATA DRIVEN APPROACH, AND THAT'S WHERE WE AT, UH, TAKE OVERHEAD LINES THAT ARE PROBLEMATIC THAT WE CAN'T, UH, IMPROVE OTHERWISE AND UNDERGROUND THEM TO, UH, UH, USING THIS ALTERNATIVE.
SO THIS IS A RELATIVELY NEW PROGRAM.
UH, AS YOU CAN SEE FROM THE, UH, FROM THE CHART, WE'VE RAMPED IT UP OVER THE YEARS, UH, BUT IT'S A PROGRAM THAT WE'RE COMMITTED TO.
UH, SO, UH, WE, UH, ARE COMMITTED FOR THE NEXT 10 YEARS TO FUND THIS AT A RATE OF A HUNDRED MILLION DOLLARS A YEAR, UH, OH, A HUNDRED MILLION DOLLARS FOR THE 10 YEAR PERIOD.
UH, SO, UH, HERE WE HAVE A COUPLE OF, OF, UH, PICTURES, WHICH, UM, JUST, UH, REALLY ILLUSTRATE THE, THE, THE, THE LEVEL OF DISRUPTION THAT, UM, THE UNDERGROUND IS.
IT HAS A SIGNIFICANT IMPACT ON THE COMMUNITIES WHERE WE'RE, WHERE WE'RE, UH, PERFORMING THIS WORK.
SO WE DO, UM, UH, WE, WE SPEND A LOT OF TIME COMMUNICATING WITH THE, THE CUSTOMER BASE, UH, WITH HOAS, UH, TO MAKE SURE THAT, THAT THE LEVEL OF DISRUPTION, BECAUSE WE ARE INTERRUPTING STREET TRAFFIC.
UM, UH, BUT, YOU KNOW, THE, THE BENEFIT IS THAT, YOU KNOW, WE, WE WANT TO SOLVE THE RELIABILITY ISSUE THAT THESE NEIGHBORHOODS HAVE, HAVE, UH, EXPERIENCED PERSISTENTLY.
SO OUR, OUR PROGRAMMERS REALLY TARGETED TO GOING AFTER THE
[00:25:01]
WORST OF THE WORST IN TERMS OF OVERHEAD CIRCUITS.UM, WE ESTIMATED, AND THIS IS A LITTLE DATED, BUT WE ESTIMATED, UH, CONVERTING THE REST OF OUR, OUR OVERHEAD INFRASTRUCTURE, UH, THAT IT WOULD TAKE US AT LEAST 20 YEARS TO COMPLETE, AND APPROXIMATELY $19 BILLION TO, UH, UH, TO FUND, WHICH IS, UM, UH, ASTOUNDING.
UH, BUT JUST TO GIVE YOU SOME CONTEXT, UH, THE FOOTNOTE AT THE BOTTOM INDICATES, YOU KNOW, JUST THE, THE TOTAL NUMBER OF TOTAL ASSETS THAT CCP HAS, C P SS ENERGY HAS, INCLUDING OUR PLANTS, UH, AND OUR, AND OUR GAS INFRASTRUCTURE AT $13 BILLION.
SO, IN ADDITION TO THOSE PROGRAMS THAT IDENTIFIED, AND WE HAVE SEVERAL OTHER PROGRAMS THAT TARGET OUR OVERHEAD INFRASTRUCTURE, UM, WE ALSO, UH, PARTICIPATE AND WE FUND AND WE SUPPORT THE CITY'S BOND PRO PROGRAMS, UH, WITH THEIR CIVIC IMPROVEMENTS.
UH, AND WE FUND THAT THIS YEAR.
WE'RE FINDING IT AT A RATE OF $44.6 MILLION.
UH, AND THIS IS AN ONGOING, UH, UH, PROJECT THAT WE INTEND TO, UH, SUPPORT.
UH, BUT ONE OF THE, THE, THE, THE OUTCOMES IS, YOU KNOW, SO EFFECTIVELY C P S IS GETTING OUTTA THE WAY.
SO OTHER, UH, THE, THE OTHER CONSTRUCTION CAN HAPPEN.
BUT IN THE PROCESS OF DOING THAT, WE ARE CONSTRUCTING A BRAND NEW LINE.
SO THAT HAS INHERENT IMPROVEMENTS IN RELIABILITY, UH, FOR THOSE, UH, AREAS THAT ARE, UH, UM, UH, HAVING THIS, UH, CIVIC IMPROVEMENT WORK BEING PERFORMED.
SO, SOME KEY, SO SOME KEY TAKEAWAYS.
UH, SO, UH, OUR UNDERGROUND SYSTEM IS OUTPACING THE GROWTH OF OUR OVERHEAD SYSTEM.
UM, AND, AND THAT'S PRIMARILY DRIVEN BY RELIABILITY.
SO WHEN WE HAVE THE OPPORTUNITY TO, TO INSTALL SOMETHING NEW, UM, WE TAKE ADVANTAGE OF IT.
UH, THERE, THERE ARE, UM, UH, THERE ARE SOME OPPORTUNITIES, UH, BUT NOT ALL OF 'EM ARE, ARE AS ECONOMICALLY FEASIBLE.
SO WE ALSO INVEST IN OUR OVERHEAD INFRASTRUCTURE, UH, WHICH WE, WE DO NOT IGNORE.
THERE'S A TREMENDOUS AMOUNT OF INNOVATION THAT'S GOING ON TO IMPROVE OVERHEAD RESILIENCY, AND WE HAVE ADOPTED MANY OF THOSE PRACTICES AND THOSE STRATEGIES.
SO OUR ELECTRONIC RECLOSER PROGRAM IS ONE, UM, YOU KNOW, THAT PROGRAM ALONE, UH, HAS IMPROVED THE PERFORMANCE OF OVER A HUNDRED DIFFERENT CIRCUITS OVER THE LAST TWO YEARS.
SO BOTH SYSTEMS HAVE ADVANTAGES AND DISADVANTAGES.
UM, OUR STRATEGY IS TO EXTRACT THE BEST OF EACH AND TO MINIMIZE THE IMPACTS, UH, TO OUR RATE PAYERS, WHILE STILL PROVIDING RELIABLE AND SAFE POWER.
I BELIEVE THAT'S MY LAST SLIDE, SO I'M GONNA PASS IT ON TO THE NEXT SPEAKER.
I'M REPRESENTING THE SUPPLY CHAIN TEAM FROM C P SS ENERGY, AND WE APPRECIATE THE OPPORTUNITY OF PROVIDING THIS UPDATE THIS AFTERNOON.
I WILL BE TOUCHING ON SOME OF THE, UM, SUPPLY CHAIN CONSTRAINTS THAT WE'RE EXPERIENCING, AND I WILL FOCUS ON THOSE AND THEN INVITE OUR EXECUTIVE VICE PRESIDENT OF CUSTOMER STRATEGY, DEANNA HARDWICK, AND SHE WILL BE OVER GOING OVER THE CUSTOMER IMPACTS.
UH, BUT PLEASE KNOW THAT OUR TEAM REMAINS FOCUSED ON MITIGATING ALL OF THE SUPPLY CHAIN CHALLENGES THAT WE KNOW ARE CURRENTLY IMPACTING OUR COMMUNITY.
AND THESE ARE SOME OF THE ITEMS THAT ARE BECOMING MORE AND MORE DIFFICULT TO PROCURE, UM, BECAUSE OF THE GLOBAL SUPPLY CHAIN CONSTRAINTS, I WILL CALL OUT, UH, DISTRIBUTION TRANSFORMERS.
WE'VE SEEN RECENTLY, UM, RECEIVE A LOT OF, OF MEDIA ATTENTION, WOODEN AND STEEL POLES, UH, COMMERCIAL AND INDUSTRIAL METER CANS, UM, AS WELL.
UM, AND OUR, OUR TEAM IS REMAINING ENGAGED WITH STAKEHOLDERS, SPECIFICALLY OUR DEVELOPERS AND OUR BUILDERS, UM, SO THAT WE ENSURE THAT THERE IS TWO-WAY COMMUNICATION WHEN IT COMES TO THE, UH, SHARING OF, OF UPDATES.
OUR TEAM HAS DEPLOYED THESE MITIGATION EFFORTS, AND I WILL, UM, CALL OUT THE FIRST, UM, IN ORDER TO INCREASE THE DIVERSITY OF MATERIALS, UM, AND EXPAND THE LIST OF SUPPLIERS WE'VE HAD TO RELAX OUR TRANSFORMER STANDARDS, UM, THAT RESULTED WITH FAILED TRANSFORMERS, UM, IN JANUARY.
UM, BUT I'M VERY PLEASED TO REPORT THAT OUR MANUFACTURERS, UM, ENDED UP INVESTING MORE INTO TRAINING AND QUALITY ASSURANCE, UH, BEFORE
[00:30:01]
SHIPPING THESE TRANSFORMERS TO C P S ENERGY.I ALSO WOULD LIKE TO SHARE THAT WE'VE RAMPED UP COMMUNICATION WITH, UM, A LOT OF OUR SUPPLIERS, OUR MANUFACTURERS, WE TALK TO THEM ONCE A WEEK, UM, TO GET, RECEIVE, UH, UPDATES.
AND WE ARE ALSO CLOSELY CONNECTED TO A LOT OF THE TRADE ORGANIZATIONS IN OUR INDUSTRY, UM, IN ADDITION TO PEER UTILITIES.
UM, AND BECAUSE WE, UH, HAVE, UH, COVID BEHIND US NOW, MY TEAM AND I ARE NOW, UH, TRAVELING TO VISIT MANUFACTURING FACILITIES TO RECEIVE, UM, UPDATES AND WALK THE PRODUCTION LINES, UM, AND BRING BACK THOSE UPDATES TO OUR, OUR COMMUNITY.
BUT WE ARE COMMITTED TO WORKING TOGETHER AND FINDING SOLUTIONS TO MAKE SURE THAT WE STAY AHEAD AS MUCH AS POSSIBLE.
UM, WHEN IT COMES TO THESE SUPPLY CHAIN ISSUES, I WILL FOCUS ON TRANSFORMERS, UM, AND THE PRIMARY DRIVERS, UM, THAT ARE MAKING IT VERY DIFFICULT FOR US TO PROCURE THESE, UM, OUR RAW MATERIAL AND LABOR SHORTAGES.
THIS IS THE THIRD YEAR NOW, UM, THAT OUR MANUFACTURERS HAVE BEEN EXPRESSING, UM, THAT IT'S, IT'S REALLY GETTING CHALLENGING TO FIND SOME OF THE RAW MATERIALS AND LABOR AND IN OUR COMMUNITY THAT WAS COMPOUNDED BY THE GROWTH.
UM, AND ONE DATA POINT IS THERE IS 50% HIGHER MATERIALS USAGE, UM, THIS YEAR COMPARED TO 2019.
UM, WE'RE ALSO COMPETING WITH A LOT OF OTHER EFFORTS UNDERWAY, UM, IN OUR STATE AND ALSO NATIONAL AND INTERNATIONAL.
UM, ONE ITEM THAT'S NOT LISTED THERE, BUT, UM, IT, IT KICKS OFF TODAY.
TODAY IS THE BEGINNING OF HURRICANE SEASON, AND SO UNFORTUNATELY, IF THERE ARE ANY OF OUR COASTAL COMMUNITIES THAT ARE IMPACTED, THE, UH, MATERIALS WILL BE PRIORITIZED AND WILL BE SENT OVER TO THESE CITIES, UH, FOR RESTORATION ON THE RIGHT ARE SOME SAMPLES OF SOME OF THE INFORMATION THAT WE HAVE SHARED.
UM, AND I WILL ALSO, UM, LIKE TO POINT OUT THAT OUR C E O, OUR PRESIDENT, C E O RUDY GARZA, SENT A LETTER TO THE TEXAS PUBLIC UTILITIES COMMISSION FEBRUARY OF LAST YEAR, UM, ESCALATING THE TRANSFORMER SHORTAGE SITUATION.
UM, AND WE ALSO, UM, MADE SURE THAT IT WAS ON THE AGENDA FOR THE, UH, SA TO DC TRIP THIS YEAR AS WELL.
UM, THERE WAS AN AMERICAN PUBLIC POWER ASSOCIATION PODCAST THAT I WAS INVITED TO RECORD ABOUT THREE WEEKS AGO, AND I WAS ABLE TO EXPLAIN WHAT WAS GOING ON LOCALLY WHEN IT COMES TO TRANSFORMERS AND THE EXPRESS NEWS ALSO PUBLISHED A STORY OVER THE WEEKEND ON THIS, ON THIS ITEM.
WE'VE BEEN ACTIVELY MONITORING GOVERNMENT RESPONSE.
MANY OF, UH, MY PEERS, A LOT, LOT OF OUR UTILITIES HAVE BEEN, UM, LOOKING TO SEE IF THE D O E WOULD, UM, ASSIGN FUNDING TO RAMP UP, UH, THE DOMESTIC PRODUCTION OF ELECTRIC TRANSFORMERS.
UNFORTUNATELY, UM, THE ENERGY EFFICIENCY WAS PRIORITIZED, AND SO THE FUNDS WERE, UM, INVESTED IN PRODUCTION OF ELECTRIC HEAT PUMPS AND OTHER ITEMS THAT ARE NEEDED FOR, FOR ENERGY EFFICIENCY.
UM, AND AS THE D O E, UM, LOOKS AT SOME OF THESE, UM, CHANGES OR, OR, UM, CHANGES IN FUNDING, THEY ALSO, UM, ARE PROPOSING CHANGES TO STANDARDS SUCH AS, UM, THEOR, AMOROUS, STEEL CORE, AND TRANSFORMERS, UM, THAT WOULD BEGIN IN 2027.
THEY'RE MORE ENERGY EFFICIENT, BUT THEY'RE HEAVIER THAN WHAT WE SEE TODAY.
OUR, OUR TRADITIONAL, UH, TRANSFORMERS HAVE GRAIN ORIENTED, ELECTRIC STEEL CORES.
UM, THAT WEIGHT OF THE, OF THE MORE ENERGY EFFICIENT WILL REQUIRE THICKER POLES, WHICH ARE ALREADY HARD TO FIND.
AND THEN THE US FORESTRY SERVICES ALSO, UH, PUSHING BACK CONSERVATION, UM, AND MINIMIZING CUTTING OF TREES.
I WILL NOW TRANSITION TO MS. HARDWICK, AND SHE WILL BE GOING OVER SOME OF OUR CUSTOMER IMPACTS AND MITIGATIONS.
AND, AND THANK YOU COUNSEL FOR ALLOWING ME THE OPPORTUNITY TO BE HERE TODAY.
SO FOR THOSE OF YOU, I HAVEN'T HAD THE OPPORTUNITY TO MEET, MY NAME IS DEANNA HARDWICK, AND MY TEAM SUPPORTS PRETTY MUCH EVERYTHING, CUSTOMER, COMMUNITY, AND COMMUNICATIONS.
AND ONE OF THE BIG AREAS THAT WE DO A LOT OF WORK IN REALLY IS THE NEW CONSTRUCTION, UH, AND, UH, SUPPORTING DESIGN WORK FOR OUR, UM, COMMUNITY AND BEING ONE OF THE FASTEST GROWING COMMUNITIES IN THE NATION.
UH, WE'VE BEEN ABLE TO WORK, UH, CLOSELY AND WE'VE BEEN MONITORING THE IMPACTS FROM SUPPLY CHAIN, SPECIFICALLY ON TRANSFORMERS VERY CLOSELY.
AND ONE OF THE KEY COMPONENTS, SO I'LL TALK ABOUT TWO DIFFERENT TYPES OF TRANSFORMERS.
THE FIRST ONE YOU SEE REFERRED TO A SINGLE PHASE.
THIS IS REALLY THE RESIDENTIAL DEVELOPMENT, UH, COMMUNITIES AND, UH, WE SEE ARE SEEING LEAD TIMES UP TO 12 MONTHS.
AND WE HAVE, UM, CLOSE TO 4,400 TRANSFORMERS ON, ON ORDER.
UH, BUT WE ARE CONTINUING TO WORK WITH OUR, UM, OUR PARTNERS AT THE GREATER SAN ANTONIO ASSOCIATION BUILDERS ASSOCIATION, UM, AS WELL AS THE REAL ESTATE COUNCIL,
[00:35:01]
SAN ANTONIO, UH, MANUFACTURERS ASSOCIATION, TO MAKE SURE THAT WE CAN SUPPORT THE GROWTH WHERE WE DO GET THE, THE TRANSFORMERS IN THAT WE ARE MEETING THE DEVELOPERS' NEEDS AS, AS QUICKLY AS WE POSSIBLY CAN.SO PART OF THAT IS MAKING SURE THAT WE ARE WORKING SIX DAYS A WEEK AND, UH, DOING EVERYTHING THAT WE CAN.
UH, ON TOP OF THAT, WE'RE ALSO STARTING TO SEE IMPACTS ON THE THREE FACE SIDE.
SO, UH, THAT'S MORE ON THE COMMERCIAL, YOUR, YOUR COMMERCIAL, UM, DEVELOPMENT.
AND, UM, WHILE INITIALLY THIS HADN'T BEEN AN ISSUE, MORE RECENTLY, WE HAVE STARTED SEEING CHALLENGES AND THESE, UH, ARE SO SPECIALIZED, UH, AND, AND BIGGER IN NATURE.
SO, UH, THERE IS UP TO 24 MONTHS OF LEAD TIME FOR THESE THREE PHASE TRANSFORMERS.
UM, BUT WE'RE, AGAIN, WE ARE WORKING WITH OUR PARTNERS.
AND ONE OF THE KEY PIECES HERE IS THAT, UM, IF SOMEONE IDENTIFIES A TRANSFORMER, THEY WANT US TO GO VET, WE WILL GO AND, UH, AND LOOK AT 'EM.
SO WE'VE BEEN ABLE TO BRING ON AN ADDITIONAL 22 TRANSFORMERS BY WORKING AND GETTING FEEDBACK FROM OUR PARTNERS, AND WE'RE CONTINUING TO BE OPEN AND LOOKING TO HOW WE CAN, UH, SUPPORT OUR COMMUNITY.
SO HERE'S A LOT OF THE KEY, UH, MITIGATION STRATEGIES THAT WE'RE DOING.
THE NUMBER ONE THING IS SOMETHING THAT I KNOW COUNCIL HAS, UH, IMPRESSED UPON US IS, IS REALLY ABOUT BEING, UH, AS TRANSPARENT AS POSSIBLE.
SO WE STARTED CONVERSATIONS IN, IN SEPTEMBER OF, UH, 2021 ON THIS.
AND, UM, WE'VE CONTINUED TO TRY AND BE AS FLEXIBLE AS POSSIBLE.
SO WHERE WE CAN, UH, WHERE WE DON'T, UH, HAVE A SAFETY ISSUE OR RELIABILITY ISSUE, WE ARE SEEING WHAT WE CAN DO TO ADJUST OUR, OUR SPECIFICATIONS TO ALLOW FOR, UH, MORE TRANSFORMERS TO COME IN.
UH, AND, AND AT THE SAME TIME, WE'RE JUST MAKING SURE THAT WE'RE HAVING THE RIGHT CONVERSATIONS.
SO WE'VE HAD OVER 16,000 ENGAGEMENTS WITH OUR PARTNERS, AND THE, THE PARTNERSHIP WITH THE CITY IS, IS, IS EXTREMELY IMPORTANT AS WE MOVE THROUGH THIS.
WE UNDERSTAND THE IMPORTANCE OF GROWTH IN FOR THE CITY OF SAN ANTONIO, AND WE'RE DOING EVERYTHING WE CAN AND CONTINUING TO BE OPEN TO ANYTHING ELSE THAT WE SHOULD, UH, CONSIDER.
VERY PROUD TO SAY THAT OUR RELATIONSHIPS HAVE CONTINUED TO EVOLVE.
IF YOU BOARD WON, UH, NIGHT, YOU WANNA SEE WHAT THE TRANSFORMERS ARE LOOKING LIKE, YOU CAN GO ONLINE AND SEE IT ON OUR WEBSITE, BUT WE CONTINUE TO LOOK FOR AS MANY OPPORTUNITIES AS POSSIBLE TO UPDATE THE COMMUNITY AND FIND SOLUTIONS.
AND I BELIEVE THAT, UH, ENDS OUR, UH, PRESENTATION.
SO WE'LL OPEN IT UP TO COUNT, UH, QUESTIONS.
THANK YOU VERY MUCH EVERYBODY FOR THE PRESENTATIONS.
RUDY, FOR THE ENTIRE TEAM FOR BEING HERE.
I ALSO WANNA ACKNOWLEDGE THE PRESENCE OF THE CHAIR OF THE BOARD OF TRUSTEES OF C P S ENERGY, JAN GONZALEZ, AS WELL AS OUR VICE CHAIR, UH, DR.
FRANCINE ROMERO, WHO ARE BOTH HERE AS WELL.
UH, WE'RE GONNA GO INTO COUNCIL DISCUSSION.
I JUST WANNA MAKE NOTE FOR THE RECORD, WE ARE STARTING TO SEE SOME MEMBERS OF THE PUBLIC COME IN.
THAT'S BECAUSE WE HAVE A TWO O'CLOCK AGENDA FOR ZONING TODAY.
IF THIS CONVERSATION LINGERS TOO LONG, I WILL LIKELY HAVE TO RECESS THE MEETING, GO TO ZONING SO WE DON'T HAVE FOLKS WAITING ALL DAY, AND THEN COME BACK TO THE DISCUSSION.
SO, UH, JUST MAKE NOTE OF THAT.
WE'RE GONNA START THE DISCUSSION NOW WITH, UH, COUNCIL MEMBER COURAGE.
UH, YOU KNOW, AS CHAIRS OF THE, OF THE M U C, I WANT TO THANK C P SS ENERGY FOR THEIR COOPERATION.
ALWAYS, UH, YOU KNOW, ANSWERING THE QUESTIONS THAT WE MAY HAVE, AND OF COURSE, THESE PRESENTATIONS BRING OUT A FEW MORE WITH ME.
UM, ONE OF THE AREAS YOU TALKED ABOUT EARLY ON WAS, UH, EMPLOYMENT, UH, OF STAFF.
SO HOW MANY EMPLOYMENT VACANCIES, UH, ARE THERE IN C P S TODAY? UM, I THINK THAT RIGHT NOW WE ARE, UM, FULLY STAFFED.
AND IN FACT, WE HAVE, UM, BEEN, UM, PERFORMING ACTUALLY BETTER THAN WE THOUGHT WE WOULD IN TERMS OF BEING ABLE TO GET THE PEOPLE THAT WE NEED HIRED.
UM, I WOULD SAY THAT THE NUMBER OF HOVERS RIGHT BETWEEN 400 AND 500 POSITIONS THAT WE'VE FILLED SINCE LAST YEAR.
SO ARE THERE ANY KEY AREAS THAT ARE, THAT YOU STILL HAVE VACANCIES? I KNOW SOME COMPANIES ARE SAYING IT'S HARD TO GET SPECIFIC TALENT TO FILL SOME OF THEIR, AND I WANNA, SORRY, I WANNA CORRECT WHAT I JUST SAID.
I THINK WE ARE FILLING VACANCIES AT THE RIGHT RATE.
THERE ARE STILL SOME VACANCIES AND THEY'RE POSTED ONLINE, I WOULD SAY, UM, THAT WE ARE FOCUSING ON THE AREAS OF IT FRONTLINE WORKERS IN ALL AREAS.
UM, AND, UM, ALL OF OUR FIELD WORKERS, AGAIN, WE'RE ALWAYS REPLENISHING THOSE RANKS.
I, I NOTICED ON SLIDE SIX OF YOUR PRESENTATION, UH, IT WAS NOTED BY ONE OF THE, UH, COMPANIES THAT, THAT DID THE SURVEYS AND EVERYTHING, SAID YOU'RE IN STABLE FINANCIAL POSITION.
UM, BUT WHAT ARE THE, THE UN THE CURRENT UNPAID BALANCES OWED BY, UH, THE PUBLIC TO C P SS FOR ENERGY COSTS? COUNCILMAN? WE'RE, UH, CURRENTLY LOOKING AT ABOUT $189 MILLION PAST DUE, UH, OVER THE LAST SIX MONTHS, WE'VE SEEN SIGNIFICANT PROGRESS.
[00:40:01]
NAMELY WE WERE AT THE PEAK OF ABOUT $207 MILLION PAST DUE.SO WE'VE BEEN ABLE TO BRING IT DOWN TO 189.
BUT THE BIGGEST PIECE I WOULD LIKE TO, UM, JUST PROVIDE, UH, SOME CONTEXT ON, AND, UH, COUNCILMAN BRAVO, I KNOW THIS IS SOMETHING THAT YOU HAD ASKED US ABOUT, IS REALLY TALKING ABOUT INSTALLMENT PLANS THAT WE CAN DO FOR OUR CUSTOMERS.
SO OVER THE PAST SIX MONTHS, WE'VE BEEN ABLE TO, UH, DOUBLE THE AMOUNT OF CUSTOMERS THAT ARE ENROLLED, UH, IN INSTALLMENT PLANS.
THE, THE TOTAL AMOUNT WENT FROM CLOSE TO $60,000, UH, TO, UH, IT'S, I'M SORRY, 600, UH, YEAH, $600,000 TO, WE'RE UP SIGNIFICANTLY.
WE ACTUALLY HAVE A HUNDRED, UM, $110 MILLION IN INSTALLMENT PLANS.
SO WE'RE SEEING MORE CUSTOMERS COMMIT TO WHAT WE HAVE FOR INSTALLMENT PLANS AND, UM, BEING ABLE TO HELP PREVENT DISCONNECTIONS.
BUT WE'RE STILL MOVING ALONG ON DISCONNECTIONS.
THE MONTH OF APRIL, WE DID ABOUT 7,000 ACCOUNT DISCONNECTIONS, ABOUT 90% OF THOSE RECONNECTED WITHIN A FEW DAYS.
WE'RE STILL FINDING VACANCIES AND CUSTOMERS MOVING OUT, UH, ESPECIALLY AS WE GO INTO, UH, THE END OF SCHOOL.
UH, AND WE, WE WILL CONTINUE TO GO THROUGH AN ADHERENCE TO OUR TERMS AND CONDITIONS, UH, FOLLOWING UP ON DISCONNECTIONS, BUT AT THE SAME TIME DOING EVERYTHING, UH, DOWN TO KNOCKING ON DOORS TO GET CUSTOMERS TO SIGN UP ON ACCOUNT.
IS IT FAIR TO SAY THAT THE 110 MILLION THAT HAVE SIGNED UP TO PAY OFF THEIR BILL ARE PART OF THE 189 THAT'S SOLD? IT IS.
SO OVER HALF OF THE PAST DUE BALANCES IS, UH, AN INSTALLMENT PLAN.
I KNOW THERE'S BEEN TALK ABOUT C P S HAVING A 2% RATE HIKE COMING TO THE COUNCIL FOR THAT, AND I'M SURE THAT HAS NOT BEEN FINALIZED IN ANY KIND OF WAY, BUT I'D LIKE TO KNOW, YOU KNOW, WHAT, WHAT'S THE, THE ANTICIPATED REVENUE FROM A 2% RATE HIKE? COUNCILMAN? YOU KNOW, WE'LL GO THROUGH THE PROCESS WITH STAFF.
UH, THE LAST RATE INCREASE, I BELIEVE, RAISED SOMEWHERE IN THE NEIGHBORHOOD OF $70 MILLION.
AND WE DID EXACTLY WHAT, YOU KNOW, WHAT WE TOLD COUNCIL WE WERE PRIORITIES, UH, FOR THAT.
I WILL TELL YOU THAT ANY PROPOSED, UH, INCREASE THIS YEAR, UH, TO BE CONSIDERED REALLY WOULD BE FOCUSED ON THE TECHNOLOGY, UH, WORK AHEAD OF US.
UH, AND, UM, AND, AND SHOULD THERE BE A NEED BEYOND, BEYOND THIS YEAR FOR NEXT, YOU KNOW, TWO YEARS FROM NOW, THAT REALLY WOULD BE THE TRANSITION TO, YOU KNOW, ON THE, ON THE GENERATION PLAN, YOU KNOW MM-HMM.
RIGHT NOW, WE DON'T NEED INVESTMENT NECESSARILY.
'CAUSE THERE'S SOME WORK TO DO TO GET READY TO CONVERT PLANS AND TO DO THE THINGS THAT THE COMMUNITY AND THE BOARD HAVE, HAVE, HAVE, UH, APPROVED.
SO, SO THAT'S KIND OF HOW IT BREAKS DOWN, RIGHT? THIS TIME, TECHNOLOGY, NEXT TIME, GEN GEN PLAN, IS IT FAIR TO SAY IF WE HAD A, A REAL INCREASE IN PEOPLE PAYING OFF THEIR BILLS, IT MAY AFFECT WHAT YOU ASKED FOR, FOR A RATE INCREASE? WELL, FOR CUSTOMERS WHO ARE BEHIND ON THEIR BILL, ANYBODY WHO'S ON AN AFFORDABILITY DISCOUNT, WE GENERALLY WORK AND OFFSET INTO THE RATE INCREASE SO THAT THOSE FOLKS AREN'T IN WORSE SITUATIONS.
SO, YOU KNOW, WHATEVER THE AFFORDABILITY DISCOUNT IS WOULD INCREASE TO KIND OF MAKE UP, YOU KNOW, FOR WHATEVER THE, THE, THE, THE NEW RATE, UH, WOULD BE.
UH, SO THAT WE DON'T PUT THEM IN ANY, YOU KNOW, FURTHER BEHIND.
UH, BUT I'LL TELL YOU, I MEAN, YOU KNOW, RELATED TO PAST DUE BALANCES, THERE'S ONLY TWO THINGS THAT YOU CAN DO.
YOU CAN PUT 'EM ON, ON, ON, UH, UH, PAYMENT PLANS, WHICH WE'RE DOING AT A REALLY STRONG CLIP, RIGHT.
YOU KNOW, THOSE ARE THE ONLY TWO TOOLS WE HAVE TO DEAL WITH THE ISSUE RIGHT.
OUTSIDE OF COUNCIL DOING, YOU KNOW, SOMETHING ELSE.
UH, LET ME ASK ABOUT THE UNDERGROUND, UH, INSTALLATION OF, UH, OF NEW CONNECTIONS.
UH, WHAT, I GUESS, UH, ON SLIDE SIX, IT TALKS ABOUT IN GENERAL COSTS FOR UNDERGROUND.
UH, HOW MUCH ARE WE BUDGETING FOR CONVERTING TO, UH, UNDERGROUND THIS YEAR? UH, 12 MILLION A YEAR.
AND, UH, HOW MUCH DO WE SPEND ON REPAIRING AND UPGRADING THE OVERHEAD LINES EVERY YEAR? UH, WE'D HAVE TO GET YOU THAT NUMBER, UH, SINCE A LOT OF THAT IS, IT'S, IT'S SPLIT BETWEEN CAPITAL.
WE CAN CAPITALIZE POLES AND WIRE.
UM, WE CAN'T CAPITALIZE A LOT OF THE OTHER ELEMENTS, UH, JUST LIKE WHEN, WHEN WE DON'T REPLACE AN ACTUAL POLE.
UH, SO THERE'S AN O AND M COMPONENT.
UM, WELL, I GUESS I'M, I'M ASKING THAT BECAUSE, UH, WE'RE TALKING ABOUT SPENDING A HUNDRED MILLION DOLLARS A YEAR.
UH, I MEAN, NO, WE'RE TALKING ABOUT SPENDING A HUNDRED MILLION DOLLARS OVER NINE YEARS TO GO AHEAD AND BURY LINES, BUT HOW MUCH ARE WE SPENDING EVERY YEAR ON MAINTAINING THE LINES THAT EXIST TODAY? IS IT EVEN, UH, A BETTER WAY TO GO AHEAD AND BURY MORE LINES? BECAUSE OVER TIME, OVER NINE, 10 YEARS, WE MIGHT BE ABLE TO SAVE A LOT MORE MONEY.
AND I, AND I LOOK AT ENERGY IN LA, THEY'RE GONNA SPEND $9.6 BILLION IN 10 YEARS TO BURY THEIR LINES.
AND WE'RE SPENDING A HUNDRED MILLION EVERY NINE YEARS TO BURY OUR LINES.
[00:45:01]
INVESTING ENOUGH IN BURYING LINES COMPARED TO WHAT THEY'RE DOING IN LOUISIANA? NOW, I DON'T KNOW HOW BIG ENERGY IS, HOW MANY MILES IT HAS OF LINES COMPARED TO WHAT WE HAVE AT C P S, BUT I'D JUST LIKE TO SEE THAT KIND OF COMPARISON TO UNDERSTAND, SHOULD WE BE INVESTING MORE THAN A HUNDRED MILLION DOLLARS IN 10 YEARS TO BURY LINES WHEN WE LOOK AT THE COST OF REPLACING AND REPAIRING THOSE BECAUSE OF STORMS OR ET CETERA? UH, OKAY.UH, COUNCILMAN, WE'LL GET YOU THE INFORMATION AS TO WHAT THE MAINTENANCE AND AND CAPITAL, UH, BREAKDOWN IS BETWEEN OVER OVERHEAD AND UNDERGROUND TO DO MORE ON, UNDER LIKE UNDERGROUNDING KIND OF HOLISTICALLY.
IT'S GONNA, I MEAN, WHAT WE'RE SPENDING IS WHAT OUR CURRENT RATE, RATE SUPPORT.
SO IF WE CHOOSE TO SPEND MORE AND YOU KNOW THAT IT'S, YOU KNOW, THREE, FOUR TIMES MORE EXPENSIVE TO, TO, TO CONVERT FROM OVERHEAD TO UNDERGROUND, THEN THERE ARE RATE IMPLICATIONS TO THAT, THAT WE'LL JUST HAVE TO AGREE THAT, THAT, THAT WE WANNA GO DOWN THAT ROAD.
COULD WE DO IT? SURE, WE COULD DO IT, BUT, UM, YOU KNOW, BUT, BUT, BUT I DO THINK THERE'S AN AFFORDABILITY COMPONENT THAT WE JUST HAVE TO HAVE TO PAY ATTENTION TO.
AND YOU, I REALIZE YOU MIGHT NEED TO DO A LITTLE BIT WORK AND GET IT TO US AT THE M U C.
THE LAST THING I REALLY WANTED TO ASK, IT'S ABOUT TRANSFORMERS.
UH, AND I NOTICED THAT YOU HAVE IN HERE THAT, UH, THERE'S A DISCUSSION, OUR, OUR SENTENCE OR TWO THAT TALKS ABOUT, UH, REUSING, UH, CERTAIN EQUIPMENT OR TRANSFORMERS.
CAN YOU TELL US ABOUT THAT? YES, SIR.
COUNCILMAN, THERE ARE SOME TRANSFORMERS THAT WE'RE ABLE TO, UH, BRING DOWN, TAKE TO OUR TRANSFORMER SHOP, AND THEN WE HAVE A CONTRACTOR WHO PICKS THEM UP, TAKES THEM TO THEIR SHOP, AND THEN THEY REFURBISH 'EM.
SO THEY MAKE 'EM ALMOST LIKE NEW AGAIN, AND THEN THEY BRING THEM BACK AND WE'RE ABLE TO REUTILIZE 'EM.
HOW MANY OF THOSE CAN WE HAVE WE DONE IN A YEAR OR THEREABOUTS? UM, I CAN GET YOU THAT NUMBER.
BUT YES, SIR, WE'VE, WE'VE HAD TO DO THAT, UM, HERE IN THE LAST COUPLE OF YEARS.
YOU KNOW, WE TALK A LOT ABOUT AFFORDABLE HOUSING UP HERE, AND WE'VE DONE A LOT WITH AFFORDABLE HOUSING, BUT, UM, THE TRUTH IS THAT, YOU KNOW, THE CITY'S GOING REALLY FAST AND, UM, YOU KNOW, WE HAVE AN IMBALANCE IN, UH, SUPPLY AND DEMAND WHEN IT COMES TO HOUSING.
AND SO WHILE WE'VE DONE GREAT WORK IN, IN FUNDING AFFORDABLE HOUSING, WE ALSO NEED TO BE ABLE TO BUILD HOUSING.
AND SO THIS CONVERSATION ABOUT TRANSFORMERS AND THE SUPPLY CHAIN ISSUE IS REALLY, UH, KEY TO THAT BECAUSE WE DO, I DO HAVE CONVERSATIONS WITH DEVELOPERS WHO SAY, I WANNA BUILD THIS NEW NEIGHBORHOOD, BUT I CAN'T GET ELECTRICITY THERE.
AND, AND THAT'S KEY FOR US TO BE ABLE TO, UH, SOLVE THIS PUZZLE OF AFFORDABLE HOUSING.
I DO WANT TO GO IN A LITTLE BIT INTO, UH, THE DAY, THE DAY MARK AND GALLUP REPORTS.
YOU KNOW, WHEN I GOT INTO THIS OFFICE, UM, WHAT WAS FRESH ON PEOPLE'S MINDS WAS, UM, THE ROLLING BLACKOUTS DURING, UH, WINTER STORM URI, THE, THE HUNDREDS OF MILLIONS OF DOLLARS LOST, UM, A LOT OF MID AND SENIOR LEVEL MANAGEMENT LEAVING C P S ENERGY THERE, NEGATIVE NEWS STORIES ABOUT EXPENSE ACCOUNTS.
AND AT THAT TIME, I TRIED TO DO A PASS AN AMENDMENT WHEN I FIRST GOT INTO OFFICE IN THAT FIRST BUDGET SAYING, HEY, LET'S, LET'S SET ASIDE SOME FUNDING FOR SOME OUTSIDE EXPERT EVALUATIONS OF C P SS ENERGY.
AND I WAS TOLD, NO, THERE'S NO MONEY IN THE BUDGET FOR THAT COUNCILMAN.
YOU KNOW, WE'RE NOT GONNA DO AMENDMENTS.
AND, AND SO MY AMENDMENT FAILED.
UM, BUT THEN I WENT BACK AND I HAD CONVERSATIONS WITH BOARD MEMBERS AND, UH, ASKED THEM, WHAT DO YOU THINK NEEDS TO BE FIXED AT C P S ENERGY? AND I HAD SOME CONVERSATIONS, AND I HAD A GREAT CONVERSATION WITH JENNY GONZALEZ, WHO WAS THEN THE VICE CHAIR, NOW THE CHAIR OF C P S ENERGY.
AND SHE REALLY TOOK THE, THE BALL AND RAN WITH THIS WHOLE CONCEPT OF LET'S DO SOME OUTSIDE EXPERT EVALUATIONS.
UM, AND SO WHAT I WANTED EVERYBODY TO KNOW THOUGH, IS WHEN, WHEN, WHEN THE BOARD TOOK THAT ON, THAT THESE WERE NEVER THESE OUTSIDE EXPERT EVALUATIONS, THEY WERE NEVER INTENDED TO BE AN EVALUATION OF RUDY, RUDY GARZA, BECAUSE HE WAS THE INTERIM C E O.
WE DIDN'T EVEN KNOW FOR SURE IF HE WAS GONNA BE THE C E O AT THAT TIME.
BUT THE, THE IDEA WAS THAT THIS WAS GONNA BE AN EVALUATION OF THE ORGANIZATION THAT RUDY WAS GONNA BE INHERITING, RIGHT? IT'S NOT, IN NO WAY A CRITICISM OF HIS LEADERSHIP, AN EVALUATION OF WHAT HE'S DOING.
AND JUST IN TIME, MY SCREEN, UH, WENT OUT.
SO GIMME ONE SECOND, BECAUSE WHAT I WANT TO DRAW YOUR ATTENTION TO, UH, IS, UH, ONE THING THAT, THAT I WAS, THAT STOOD OUT TO ME IS, UM, ON PAGE NINE OF THE GALLUP, UM, THE GALLUP EVALUATION, UM, WHICH WAS AN AREA OF FOCUS OPERATIONS AND THE OBSERVATIONS HERE WHERE LEADERS AND EMPLOYEES RECOGNIZE THE IMPORTANCE OF CHANGING HOW DECISIONS ARE MADE WITHIN THE ORGANIZATION.
EMPLOYEES EXPRESS SOME FRUSTRATION WITH A
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LONG PROCESS TO GET APPROVAL FOR BASIC REQUESTS.C P S ENERGY LEADERS UNDERSTAND THE CURRENT DECISION MAKING PROCESS COULD BE MORE EFFICIENT.
THE TIME LEADERS SPEND ON THE LENGTHY DECISION MAKING PROCESS TAKES AWAY FROM THEIR ABILITY TO FOCUS ON MORE STRATEGIC OBJECTIVES.
EMPLOYEES FEEL THERE IS SOME MISALIGNMENT BETWEEN THE BEHAVIORS THEY'RE TOLD ARE EXPECTED AND THE DISTRIBUTION OF PROMOTIONS AND RECOGNITION.
AND SO, UM, THAT RESONATED WITH ME, I GUESS TO EXTENT WITH THE OLD C P S ENERGY THAT I HAD EXPERIENCED, AND WITH WHAT I HEARD FROM PEOPLE TRYING TO DO BUSINESS WITH C P S ENERGY.
AND WHEN I THINK ABOUT THE, THE BUSINESS MODEL, UH, FOR, UH, FOR ENERGY UTILITIES, IT'S RAPIDLY EVOLVING.
AND SO WE NEED TO EVOLVE WITH THAT MARKET.
WE NEED TO BE ABLE TO MAKE DECISIONS FAST.
AND I UNDERSTAND YOU HAVE TO BALANCE THAT WITH A CONSERVATIVE APPROACH.
BUT I JUST WANTED TO SEE, RUDY, IF YOU COULD SPEAK TO THAT A LITTLE BIT ABOUT WHAT YOU'RE DOING TO ADDRESS THIS IN, IN, IN GETTING THIS, UH, MOVING US IN THE RIGHT DIRECTION.
I WOULD, UH, CHARACTERIZE C P S ENERGY.
YOU KNOW, IT'S NOT A, A PORSCHE THAT TURNS ON A DIME.
UH, YOU KNOW, IT'S, IT'S MORE LIKE A LARGE BOAT THAT YOU'VE GOTTA TURN OVER, YOU KNOW, A COUPLE OF MILES IN THE OCEAN.
SO IT TAKES TIME, UH, TO CHANGE THE CULTURE.
BUT I'LL TELL YOU, MY DIRECT LEADERSHIP TEAM, UH, THEY'RE MAKING MORE DECISIONS THAN I THINK THEY'VE EVER BEEN ALLOWED TO MAKE, UH, IN, IN THE PAST.
I THINK WE'RE STILL GOT WORK TO DO, PUSHING THAT ACCOUNTABILITY AND, AND THE EMPOWERMENT DOWN TO THE, THE, THE CLOSEST LEVEL, UH, TO THE WORKFORCE AT THE, AT THE DIRECTOR AND THE MANAGER LEVEL.
UH, BUT I THINK WE'RE MAKING PROGRESS.
I THINK WE'RE, WE'RE CONSTANTLY REINFORCING THAT WE WANT PEOPLE TO MAKE DECISIONS THAT ARE IN THEIR WHEELHOUSE.
UH, I'M HONESTLY, YOU KNOW, I'VE SAID IT BEFORE, I'LL SAY IT AGAIN.
I'M THE LEAST IMPORTANT PERSON IN MOST ROOMS WHERE THERE ARE C P S ENERGY EMPLOYEES.
MY JOB IS TO ENABLE 'EM AND TO TRY TO STAY OUTTA THEIR WAY AND MAKE SURE THEY HAVE THE RESOURCES THAT THEY NEED TO DO THEIR JOB.
AND SO, YOU KNOW, ALL I CAN TELL YOU IS A TYPE OF, OF, UH, CULTURE I'M TRYING TO CREATE.
UM, BUT WE, WE WILL ALWAYS HAVE WORK TO DO, AND WE CAN ALWAYS BE BETTER.
THANK YOU FOR THAT ANSWER, RUDY.
AND, UH, I, I WANT EVERYONE TO KNOW THAT I, I REMEMBER WHEN THIS, THE RESULTS OF THESE EVALUATIONS WERE PRESENTED TO C P S ENERGY.
I KNOW THEIR BOARD MEETS ON A MONDAY, AND, UH, THAT SUNDAY I CALLED UP RUDY GARZA AND I SAID, RUDY, SO WHAT DO YOU MAKE OF THESE, UM, THE, THE RESULTS OF THESE EVALUATIONS? BECAUSE FROM MY THOUGHT THESE WERE GONNA BE, CREATE A ROADMAP FOR SUCCESS FOR THE NEW C E O, RIGHT? AND I SAID, WELL, WHAT DO YOU THINK OF THESE EVALUATIONS AND, YOU KNOW, DO YOU FIND THEM USEFUL? AND HE SAID, COUNCILMAN, I HAVEN'T SEEN THEM.
I DON'T GET TO SEE 'EM UNTIL YOU DO AND THE PUBLIC DOES IN THE MEETING TOMORROW.
AND THAT IS SOMETHING THAT I THINK A LOT OF PEOPLE WANTED.
THEY WANTED TO KNOW THAT THIS WAS DONE COMPLETELY INDEPENDENT OF C P S ENERGY STAFF.
AND SO I WANNA STAY TO, TO CHAIR JAMIE GONZALEZ, YOU NAILED IT.
COUNCIL MEMBER MCKEE RODRIGUEZ.
AND THANK YOU FOR ALL THREE PRESENTATIONS.
UH, I, I DO WANT TO GIVE A COUPLE FLOWERS.
I, I BELIEVE C P S HAS MADE, UH, GREAT PROGRESS IN REGAINING THE TRUST OF OUR CONSTITUENTS.
AND, UH, FOR EXAMPLE, CP S'S RESPONSE TO THE PAST FEW CRITICAL WEATHER EVENTS THAT WE HAD, INCLUDING THE ASSISTANCE THAT YOU PROVIDED IN AUSTIN, ALL PLAYED A KEY ROLE IN THAT.
EVERY CONVERSATION THAT WE HAVE, ESPECIALLY AS WE APPROACH MONTHS OF INCREASING HEAT AND RISING ENERGY, UH, COST IS GOING TO BE INCREASINGLY SCRUTINIZED.
AND SO THESE CONVERSATIONS IN THE FUTURE MIGHT NOT BE AS FLOWERY.
UM, SO I DO APPRECIATE YOUR TRANSPARENCY REGARDING SUPPLY CHAIN ISSUES AND THE STEPS YOU'VE TAKEN TO MITIGATE THOSE CHALLENGES, BECAUSE IT'S AN ISSUE THAT'S LARGELY OUTSIDE OF OUR CONTROL.
UM, A FEW OF THE KEY TAKEAWAYS, UH, THAT I SAW WERE THAT SYSTEM UPGRADES AND OTHER IMPROVEMENTS WILL BE NECESSARY, AND THEY WILL COME AT A COST THAT WILL LIKELY LEAD TO A PROPOSED RATE INCREASE.
I'D BE INTERESTED IN DEEPER CONVERSATIONS THAT YOU'VE HAD ABOUT COST EFFICIENCIES THAT CAN BE IDENTIFIED WITHIN THE STRUCTURE OF C P SS.
AND, UH, YOU KNOW, I KNOW COUNCILMAN BRAVO HAS BROUGHT UP THE IDEA OF INDEPENDENT THIRD PARTY CONSULTANTS PROVIDING SUCH A SERVICE.
AND I, I KNEW YOU WAS GONNA, I KNEW YOU WERE GONNA BRING IT UP AGAIN.
UH, AND I SAY THAT BECAUSE, YOU KNOW, I VOTED AGAINST THE LAST RATE INCREASE, AND I FEEL LIKE I WAS CONSISTENT IN WHAT I ASKED FOR, UH, IN THE MONTHS LEADING UP TO THAT VOTE AND IN WHAT MY EXPECTATIONS WERE.
AND THIS TIME, I WANNA STRESS THAT BEFORE YOU ASKED MORE OF OUR CONSTITUENTS, YOUR CUSTOMERS AND ASK THEM TO MAKE A FISCAL SACRIFICE, UH, THEY'RE GONNA WANNA KNOW WHAT YOU DID TO PREVENT THAT.
WHAT CUTS DID YOU MAKE? WHAT SACRIFICES DID YOU MAKE? AND IF YOU AREN'T MAKING ANY CUTS, BUT YOU'LL BE IMPROVING YOUR LEVEL OF SERVICE, I THINK YOUR JOB THEN IS TO SELL CUSTOMERS ON THAT.
EXPLAIN TO THEM, YOU KNOW, WHY THEY NEED THOSE IMPROVEMENTS AND WHAT IS THAT GONNA DO FOR THEIR
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QUALITY OF LIFE, THEIR FUTURE ENERGY BILLS, ALL OF THAT.AND I THINK, YOU KNOW WHAT THE REASONS ARE, YOU'VE CONVEYED THEM TO US.
AND SO I REALLY EXPECT HEAVY, UH, CUSTOMER ENGAGEMENT ON YOUR END PRIOR TO, PRIOR TO COMING TO US FOR A RATE INCREASE.
UH, BUT THAT'S MY 2 CENTS AND I'LL LEAVE IT THERE.
MY FOCUS, UH, IN THIS PRESENTATION IS GONNA BE NARROW.
AND I'M VERY INTRIGUED BY THE PRESENTATION ON UNDERGROUNDING AND WHAT'S BEING DONE NOW AND WHAT WE COULD BE DOING.
AND EARLIER THIS YEAR, COUNCILMAN COURAGE, COUNCILWOMAN CAB HDA AND I CO-AUTHORED A C C R, UH, REQUESTING THE INCLUSION OF POWER LINE BURIAL IN THE SCOPE OF WORK OF OUR EXISTING INFRASTRUCTURE PROJECTS.
SO LARGELY I'M TALKING TO, UH, MR. WALSH AND PUBLIC WORKS.
UM, BUT I WOULD LIKE TO, UM, EXPRESS TO CITY STAFF AND MY COLLEAGUES LET THE ISSUE OF ABOVE GROUND VERSUS UNDERGROUND POWER LINES IS A QUALITY OF LIFE ISSUE.
AND IT SHOULD BE A KEY PRIORITY TO US.
AND I WANNA BE VERY CLEAR THAT SOMETHING THAT THAT SHOULD BE SOMETHING THAT WE AS A CITY ARE DOING AND PRIORITIZING IN ADDITION AND IN COORDINATION WITH THE UNDERGROUNDING STRATEGY THAT C P S HAS IMPLEMENTED.
SO WHAT THAT LOOKS LIKE TO ME IS THAT A HIGH LEVEL OF COORDINATION, UH, COULD ALLOW US TO SCHEDULE CCP IS UNDERGROUNDING PLAN WITH INFRASTRUCTURE WORK ON OUR END THAT'S ALREADY BEING SCHEDULED.
AND THAT IN TURN ALLOWS US TO LEVERAGE RESOURCES AND STRETCH OUR DOLLARS.
AND I KNOW THERE'S A HABIT TO SAY BEFORE WE GET THERE, THERE'S A HABIT TO SAY WE'RE ALREADY COORDINATING.
BUT I GET CALLS FROM MY CONSTITUENTS WHO SAY THE CITY JUST CAME IN AND THEY TORE MY ROAD AND REDID IT, AND THEN UTILITIES CAME IN AND THEY TORE IT UP AGAIN, AND, YOU KNOW, WHY DIDN'T THEY COORDINATE BETTER? AND LAST MONTH NEWS A BROKE OF ONE OF OUR FORMER UTILITY COORDINATORS PLAYING GOLF WHEN HE SHOULD BE WORKING.
AND I KNOW THAT'S ONE EXTREMELY UNCOMMON SITUATION, AND I KNOW HE WAS LET GO, BUT TO ME, IT DRAWS A PICTURE, UH, FOR MY CONSTITUENTS OF WHAT COORDINATION LOOKS LIKE BETWEEN US AND OF OUR UTILITY.
AND IT HAS NOT INSPIRED CONFIDENCE.
AND SO I IMAGINE THAT, UH, I'LL GO BACK TO THE BIGGER ISSUE IS THAT I IMAGINE THAT A BULK OF UNDERGROUND ABOVE GROUND POWER LINES ARE IN LOW INCOME COMMUNITIES OF COLOR.
SO THIS IS ALSO AN ISSUE IN A MATTER OF EQUITY.
UM, AND I, I DON'T WANNA GET SIDELINED BY THE CONVERSATION I JUST MENTIONED ABOUT THE EMPLOYEE, BUT IN NEIGHBORHOODS LIKE SUNRISE WHERE ALMOST EVERY ROAD IS AN F STREET AND THEY HAVE ABOVE GROUND POWER LINES, WHEN THEIR ROADS ARE IMPROVED, YOU KNOW, THEIR, THEIR POWER LINES LIKELY ARE NOT GONNA BE BURIED.
AND SO WHAT MY SPECIFIC REQUEST IS, 'CAUSE I'VE, I'VE HIT THE ISSUE.
WHAT I'M SPECIFICALLY ASKING IS THAT THE BURIAL OF THOSE POWER LINES TO BE INCLUDED IN THE EXISTING SCOPE OF WORK OF MAJOR INFRASTRUCTURE, UH, PROJECTS.
AND I BELIEVE THAT THE CONVERSATION HERE TIES IN BECAUSE WE COULD BE COORDINATING.
I DIDN'T REALIZE THIS WAS A PROGRAM THAT YOU HAD INVE THAT YOU WERE INVESTING SO MUCH MONEY IN.
AND I THINK THAT MAKES IT EVEN MORE PARAMOUNT THAT WE DO THAT.
THAT'S ALL MY, THAT'S ALL MY COMMENTS.
COUNCIL MEMBER MICKI RODRIGUEZ, COUNCIL MEMBER KEO.
THANK YOU MAYOR, AND THANKS FOR THE PRESENTATION.
THANKS RUDY AND ALL OF THE C P S TEAM FOR YOUR WORK TO CONTINUE TO PROVE, IMPROVE THE CULTURE OF C P S AND OF COURSE, THE MOST IMPORTANT THING.
UM, RELIABILITY AND RESPONSE TO OUR, OUR CUSTOMER, TO YOUR CUSTOMERS, I GUESS OUR CONSTITUENTS.
THERE'S BEEN A LOT OF CHANGES, UH, MADE SINCE WINTER STORM, YURI, AND, UM, AND I'M GRATEFUL FOR THE COMMUNICATION PLAN AND INCREASED OUTREACH THAT Y'ALL HAVE BEEN DOING.
I CREDIT YOU, RUDY, AND OF COURSE, THE BOARD.
UM, AND AS WE CONTINUE TO FACE SUPPLY CHAIN SHORTAGES AND INCREASE IN COST AND LACK OF LABOR, I'M GLAD TO HEAR THAT YOU'RE WORKING WITH OUR BUSINESS COMMUNITY TO ENSURE QUALITY PRODUCTS ARE STILL BEING PREPARED AND OFFERED TO SAN ANTONIANS.
I HAVE JUST A COUPLE QUESTIONS, BUT FIRST I WOULD LIKE TO INVITE, UM, CHAIR MARTINEZ.
UM, IF YOU WOULDN'T MIND COMING TO THE PODIUM, JUST TO THANK YOU FOR YOUR HARD WORK AND YOUR DEDICATION TO, UM, OUR COMMUNITY.
YOU HAPPEN TO BE MY REPRESENTATIVE ON C P SS, SO I, I'M THANKFUL FOR THAT.
BUT BEING A WOMAN IN TECH AND THE BACKGROUND THAT YOU HAVE, CAN YOU TALK A LITTLE BIT, A BIT ABOUT, OR DO YOU HAVE ANY RESERVATIONS ABOUT THE TECHNOLOGY TRANSITION? I DON'T NECESS GET ON HERE.
I DON'T NECESSARILY HAVE RESERVATIONS.
I THINK LIKE WITH ANY TECHNOLOGY PROJECT, A KEY COMPONENT TO THAT IS THE GOVERNANCE.
AND SO BASED ON THE FEEDBACK FROM THE DAY MARK REPORT, UH, SOMETHING THAT WE'RE ALREADY DOING, I THINK ONE OF THE SMARTEST THINGS THAT WE'RE DOING IS IMPLEMENTING IT IN PHASES.
AND THAT INCLUDES, UM, THE BUDGET IS ALSO IN PHASES, RIGHT? AND SO THAT'S A LITTLE BIT MORE PALATABLE.
I THINK A KEY COMPONENT ALWAYS WITH A SUCCESSFUL E R P ROLLOUT IS THREE THINGS.
AND THAT'S GONNA BE YOUR PEOPLE, YOUR PROCESS AND THE TECHNOLOGY THAT WE APPLY.
AND OBVIOUSLY THE GOVERNANCE COMPONENT IS THAT.
AND SO ONE KEY AREA IN HOW GOVERNANCE IS GONNA BE KEY TO THIS IS INVOLVING THE BOARD OF TRUSTEES THROUGH THE VARIOUS COMMITTEES THAT WE HAVE.
'CAUSE THE E R P SYSTEM, FRANKLY, IN ALL FAIRNESS, WILL TOUCH MANY COMPONENTS OF HOW WE DELIVER SERVICE TO OUR CUSTOMERS.
AND THEREFORE, AN INTERNAL GOVERNANCE WOULD BE A KEY KEY INDIVIDUALS WITH SPECIFIC SKILL SETS
[01:00:01]
WITHIN THE C P S ORGANIZATION, THAT'LL BE PART OF A BOARD OF AUTHORITY, WHAT WE CALL PROGRAM MANAGEMENT OVERVIEW, WORKING HAND IN HAND, UM, THROUGH THE COMMITTEES OF THE BOARD OF TRUSTEES TO BE KEPT UP TO DATE ON WHERE WE'RE AT.SO AGAIN, I THINK THE KEY COMPONENT IS PHASING IT OUT.
UH, KEEP IT IN MIND THAT WE GOTTA MAKE SURE THAT THE RIGHT PEOPLE ARE INCLUDED IN THE PLANNING.
THAT INCLUDES EVERYBODY FROM THE KEY STAKEHOLDERS, INTERNAL AND EXTERNAL, AS WELL AS, YOU KNOW, HIRING THE RIGHT TALENT.
I THINK THAT ONE RISK ALWAYS WITH IT PROJECTS IS A HIGH TURNOVER IN TALENT, AND THAT IS JUST BECAUSE IT'S SUCH A COMPETITIVE ARENA.
I THINK SOME OF THE OTHER THINGS TO CONSIDER THAT A RISK IN ANY PROJECT WOULD BE, YOU KNOW, ENVIRONMENTAL CHANGES THAT ARE ABOVE AND BEYOND OUR CONTROL AND, UH, ECONOMY, YOU KNOW, INFLATION, UH, THE COST OF SUPPLIES BEING HIGHER SOFTWARE PEOPLE.
AND SO I THINK OVERALL, UM, WE'RE TAKING SOME REALLY GOOD BABY STEPS IN HOW WE'RE ROLLING IT OUT, AND I THINK PHASES ARE A KEY TO IT.
SO THANK YOU FOR ASKING THAT QUESTION.
AND WHILE YOU'RE UP HERE, IS THERE ANYTHING ELSE YOU WANNA ADD JUST AS CHAIR? UM, I WOULD JUST SAY THAT, YOU KNOW, WE NEED THE E R P.
UM, IT IS A KEY COMPONENT TO HOW WE POSITION C P S FOR TOMORROW.
UM, IT'S NOT GONNA, LIKE ANYTHING ELSE, THE, THE SYSTEM IS NOT GONNA ALWAYS SOLVE THE PROBLEM.
AT THE END OF THE DAY, IT'S THE ADOPTION AND HOW WE USE IT AND HOW IT'S APPLIED TO THE ARRAY OF THE DIFFERENT PEOPLE THAT WOULD TOUCH THE SYSTEM.
BUT IT'S A MUCH NEEDED, UH, COMPONENT IN ORDER FOR US TO SUCCEED AND COMPETE AND TO, YOU KNOW, BE A STRONGER C P S TOMORROW.
AND SO I THINK WE, AS A, AS A CITY COUNCIL, YOU'VE MADE SOME REALLY GOOD INVESTMENTS, LIKE THE GENERATION PLAN, UH, THE WEATHERIZATION, YOU KNOW, INVESTMENTS.
AND THE E R P SYSTEM WILL END AT HAND IN HOW WE DELIVER THOSE SERVICES.
SO I THINK IT'S A GOOD BEGINNING.
UH, I THINK THAT, AGAIN, THE BOARD OF TRUSTEES HAS AN IMPORTANT ROLE, UH, FOR OVERSIGHT IN THE E R P SYSTEM AND WILL LEVERAGE THE COMMITTEES TO DO SO.
UM, JUST ONE MORE QUESTION ACTUALLY, AND IT'S ABOUT, UH, I GUESS MORE FOR RUDY, UM, THE UNDERGROUND ELECTRICAL LINES AND SLIDE ONE OF THE SLIDES YOU TALK ABOUT.
UM, WELL, THE INCREASED COST, I MEAN, WE TALKED ABOUT THAT.
I THINK, HOW MUCH WAS IT OVER 20 YEARS? IS IT 2 BILLION? YEAH, SO I MEAN, MEAN TO UNDERGROUND OUR ENTIRE SYSTEM, 20.
OUR WHOLE SYSTEM TODAY IS WORTH $13 BILLION.
THAT'S HOW MUCH ASSET, THAT'S OUR ASSET BASE.
SO WE WOULD ACTUALLY NEED TO INCREASE IT ONE AND A HALF TIMES TO BE ABLE TO, TO MOVE IT ALL TO UNDERGROUND.
SO IT, IT'S A BIG LIFT TO EXPECT OUR WHOLE SYSTEM TO BE UNDERGROUND AND ONE THAT I QUITE FRANKLY DON'T THINK OUR CUSTOMERS CAN AFFORD.
IS IT, I THINK THE SLIDE SAID SOMETHING ABOUT, UM, IN 20 YEARS, LIKE THERE WAS A TIMEFRAME.
I THINK WHEN THE TEAM WAS LOOKING AT IT, IT WAS LIKE, YOU KNOW, YOU CAN'T GET ENOUGH RESOURCES AND MATERIALS TO UNDERGROUND THE ENTIRE SYSTEM.
THERE'S JUST NOT ENOUGH RESOURCES.
SO THEY WERE, THAT'S LOOKING AT IT AT THAT APPROACH.
THEY WERE TALKING ABOUT, WELL, MAYBE 20 YEARS TIMEFRAME TO UNDERGROUND EVERYTHING.
I, I, YOU KNOW, AS, AS MUCH AS IT SOUNDS CRAZY TO, TO, UM, DO SOMETHING LIKE THIS OVER 20 YEARS, I DO THINK IT'S WORTH THE INVESTMENT.
UM, YOU KNOW, WE JUST TALK WITH THE, THE CHAIR ABOUT, UM, THE INVESTMENTS THAT WE'VE MADE AS A COUNCIL.
UM, IN C P S AND I, I'LL TELL YOU, I, I WAS AT THE WET SEA.
I DON'T KNOW IF Y'ALL HAVE BEEN TO THE WEST SIDE EDUCATIONAL TRADING CENTER IN, IN MY DISTRICT.
AND WE HAD THIS BIG, BEAUTIFUL NEW FACILITY.
AND I WAS STANDING ON THE SECOND FLOOR, LOOKING OUT AT THE, THE NEIGHBORHOOD.
AND ALL I COULD SEE WERE POWER LINES.
AND IT WAS, IT'S KIND OF, YOU KNOW, A LITTLE DISHEARTENING, RIGHT? TO BE IN THIS BIG, BEAUTIFUL NEW BUILDING AND THEN THIS, THIS VERY OLD NEIGHBORHOOD, VERY ESTABLISHED NEIGHBORHOOD, AND IT HAS, UH, THIS POWER LINES EVERYWHERE.
AND SO, I MEAN, I, I AGREE WITH, UM, COUNCILMAN
'CAUSE THEY'RE HAVING TO PAY FOR THE DIFFERENCE.
SO THEY'RE PAYING, THE COSTS ARE UNDERGROUNDING.
SO AREAS LIKE THE PEARL, IT'S ALL BUILT IN THOSE, UH, THE DEVELOPMENT COST, UH, NEW SUBDIVISIONS, PRIMARILY EVERY NEW SUBDIVISION, NO MATTER WHERE IT IS IN TOWN, IS GOING UNDERGROUND BECAUSE OF THE COST JUST FOR THE UNDERGROUND IN A RESIDENTIAL AREA IS A LOT CHEAPER.
AND IT'S SMALLER WIRE, SMALLER INFRASTRUCTURE.
SO WE CAN DO A SUBDIVISION FAIRLY EASY AND FAIRLY CHEAP.
EVERYTHING ELSE, ALL THE THREE PHASE LINES GOING DOWN THE STREETS, THE CABLES GET REALLY BIG AND IT'S A LOT OF POWER.
AND YOU'RE HAVING TO CONCRETE ENCASE AND PUT MANHOLES TO PULL, UH, THE CABLES JUST THROUGH THOSE SYSTEMS. AND THEN, YOU KNOW, UM, A CONNECTION THAT WE CAN MAKE BETWEEN WHEN YOU SEE POLES AT AN INTERSECTION, YOU KNOW, IT'S JUST, IT'S A SIMPLE CONNECTION OF TWO WIRES.
BUT IF YOU'RE CONNECTING UNDERGROUND SYSTEMS, YOU HAVE TO SPEND ON, UH, AN INVESTMENT ON BIG EQUIPMENT THAT'S VERY EXPENSIVE JUST TO MAKE THOSE CONNECTIONS.
SO IT'S JUST, IT'S VERY PRICEY.
[01:05:01]
HEAR YOU.AND I, AND WHEN WE TALK ABOUT AFFORDABILITY AND, UH, I THINK THAT IT'S, UM, IN THE LONG TERM, IT'S, IT'S WORTHWHILE.
WE HAVE, AS EVERYBODY KNOWS, UH, JUST HUNDREDS OF PEOPLE MOVING TO OUR CITY ALL THE TIME.
IT'S HAPPENING A LOT IN MY DISTRICT.
UM, BUT WE HAVE TO TAKE CARE OF THE PEOPLE THAT ARE HERE, THAT HAVE BORN AND RAISED HERE, THAT HAVE GENERATIONS OF SAN ANTONIANS, WHO ARE, ARE LOOKING UP AT THE SKY AND SEEING POWER LINES WHERE THE NEWER, UH, AREAS OF TOWN ARE, ARE, DON'T HAVE TO NECESSARILY DEAL WITH THAT.
AND I UNDERSTAND THE REASON WHY.
I DON'T THINK IT'S AN INTENTIONAL, UM, UH, CIRCUMSTANCE, BUT, BUT I THINK THAT WE NEED TO BE INTENTIONAL ABOUT KIND OF CORRECTING THAT AS WE LOOK BACK.
ONE THING I'LL SHARE IS EVEN WITH OUR PROGRAM OF THE $10 MILLION THAT WE'RE UNDERGROUND IN, UH, THE TELECOMS KEEP THE POLES THERE, SO THE POLE INFRASTRUCTURE'S NOT COMING DOWN.
SO WE'RE, YOU KNOW, SOMETIMES IT'S IMPACTING THE COMMUNITY DOUBLE BECAUSE YOU GOT THE POLES, PLUS YOU GOT BOXES AND PEOPLE'S YARDS, AND WE'RE TEARING UP THE STREETS.
SO IT'S JUST, WE CAN'T FORCE THE TELECOMS TO GO UNDERGROUND EITHER.
SO THE, THE, THE, THE POLES WOULD REMAIN FOR TELECOM ISSUES, BUT NOT THE ACTUAL LINES.
THEY WOULD BE, THE POWER LINES ON THE VERY TOP ARE REMOVED, BUT ALL THE THICK MM-HMM.
THE POLES MAY BE A FIGHT FOR ANOTHER DAY.
BUT, UM, I THINK TO START WITH, YOU KNOW, YEAH, JUST THE, NO, I, THAT'S GOOD TO KNOW.
I DIDN'T, I DIDN'T UNDERSTAND THAT BEFORE.
BUT I, I THINK, UH, UM, LOOKING AT BEARING THE POWER LINES, EVEN THOUGH IT'S, I MEAN, JUST BECAUSE IT'S NOT GONNA BE EASIER OR CHEAP DOESN'T MEAN IT'S NOT WORTHWHILE DOING.
AND, AND MAYBE IT DOES TAKE US LONG, MAYBE IT TAKES US LONGER THAN 20 YEARS, BUT I THINK TO START, UM, PLANTING THAT SEED NOW WOULD BE, WOULD BE GREAT.
COUNCIL MEMBER, COO HDA, COUNCIL MEMBER CASTILLO.
AND THANK Y'ALL FOR THE PRESENTATION.
UH, I, I'M PLEASED TO HEAR WITH WHAT THE FINDINGS OF THE THIRD PARTY STUDIES, UM, ARE RECOMMENDING THAT C P S IS ALREADY IMPLEMENTING, UH, INTO THEIR STRATEGIES AND THEIR PLANNING.
UM, I, I ALSO WANNA RECOMMEND COUNCILMAN BRAVO FOR HIS LEADERSHIP.
AND AGAIN, I REMEMBER THOSE CONVERSATIONS ABOUT, UH, ADVOCATING FOR A THIRD PARTY STUDY AND THAT WHOLE DEBATE.
AND, AND AGAIN, UH, I, I WANNA COMMEND JANIE AS WELL FOR TAKING THAT ON.
UH, I HEAR IT FROM COMMUNITY, AND I'VE SHARED THIS WITH RUDY ABOUT THE, THE REBUILDING OF THE TRUST WITH C P S AND PARTICULARLY LEADERSHIP.
UH, AND HEARING THAT THEY'RE, THEY'RE GRATEFUL THAT, UH, THERE'S OPEN COMMUNICATION AND IT'S RESPECTFUL AND IT'S GENUINE.
SO I WANTED TO, TO THANK YOU FOR THAT.
UM, THAT MEANS A LOT TO COMMUNITY.
UM, IN REVIEWING THE DAYMARK STUDY, IT STARTS, UH, STATES RATHER THAT C P S ENERGY HAS A FORECAST THAT WILL REQUIRE AN ADDITIONAL 5.5% RATE INCREASE IN THE FISCAL YEAR, 2025 AND 2027, AS WELL AS, UH, THE INTENT TO ADJUST RATES ON A MORE REGULAR BASIS.
AND I'M WONDERING IF THERE'S OPPORTUNITY, UM, WITHIN THE BOARD TO, TO COMMIT TO AGGRESSIVELY GOING AFTER FEDERAL GRANTS, UM, THAT CAN HELP SCALE UP CASA VERE, RIGHT, TO HELP OFFSET THE COST OF ENERGY USAGE, UH, BY HELPING TO, UM, TO REHAB THE HOME OR GIVE INSULATION, WHATEVER THE CASE MAY BE FOR THE HOME TO WHERE, UM, WE'RE DRASTICALLY SCALING UP THAT BUCKET FOR CASA VERE.
IS THAT SOMETHING YOU'RE CURRENTLY DOING? UH, IS THAT A, A COMMITTEE OR A BOARD CONVERSATION? UH, COUNCIL M CASTILLO, THANK YOU FOR THAT QUESTION.
WE ARE AGGRESSIVELY GOING AFTER C P S ENERGY FOR WHATEVER REASON, REALLY HASN'T BEEN REAL AGGRESSIVE, UM, ON, ON THE GRANT SIDE IN THE PAST, BECAUSE THE STRINGS ATTACHED AND THINGS YOU HAVE TO DO TO ACCESS THE GRANTS.
UM, YOU KNOW, WE'VE REALLY, UH, UH, CREATED AN ORGANIZATION TO ACTUALLY LOOK AT EVERY GRANT THAT WE THINK IS, IS DOABLE, UH, AND GET MORE AGGRESSIVE.
OUR, OUR, OUR BOARD HAS ASKED US, UM, TO, TO, TO LOOK AT NEW WAYS TO BRING IN REVENUE.
SO THAT'S LESS REVENUE WE ASKED, WE HAVE TO ASK, UH, FROM OUR CUSTOMERS.
AND SO, UH, FEDERAL DOLLARS THAT ARE AVAILABLE.
UH, I THINK COUNCILMAN, I MEAN, UH, CONGRESSMAN CASTRO, UH, UH, UH, COUNCILWOMAN CASTRO PUT A, A A A, UH, APPROPRIATION IN FOR US TO GET MORE DOLLARS FOR WEATHERIZATION.
UM, SO YES, WE'RE DOING MORE ACROSS THE BOARD AND WE'RE WORKING VERY CLOSELY, UH, WITH THE CITY WHERE THERE ARE WAYS THAT WE CAN PARLAY ONE PROGRAM ON TOP OF ANOTHER TO HELP THOSE MOST IN NEED IN OUR COMMUNITY.
YOU KNOW, C P S ENERGY'S KIND OF ON BOARD WITH WHATEVER OUR, OUR ROLE TO PLAY IN THAT IS.
SO, SO FEDERAL DOLLARS WILL BE A WAY WE, WE DIVERSIFY OUR REVENUE GOING FORWARD.
THAT, THAT'S, UM, AMAZING TO HEAR.
AND I KNOW OUR CONSTITUENTS ALWAYS CALL ABOUT THE PROGRAM, UH, AND IT'S GOOD TO HEAR THAT Y'ALL CONTINUE TO ADVOCATE AND GO AFTER THOSE DOLLARS.
UM, WITH THE GALLUP REPORT, I WAS REALLY PLEASED TO SEE THAT LABOR WAS INCLUDED AND THAT THE I B E W WAS, UH, INCLUDED IN THAT CONVERSATION ABOUT, UH, HOW TO IMPROVE.
UM, SO JUST A, A LOT OF GOOD THINGS BEING IDENTIFIED.
UH, I WANTED TO SHIFT TO UNDERGROUNDING, UM, DISTRICTS LIKE MINE, RIGHT? WE HAVE SOME OF THE CITY'S OLDEST INFRASTRUCTURE BEFORE THERE ARE ZONING CODES.
[01:10:01]
HAVE A LOT OF VERY NARROW SIDEWALKS WITH, UM, C P S POLLS RIGHT IN THE CENTER.AND IT'S DIFFICULT TO, TO EXPAND THE SIDEWALKS 'CAUSE THIS, THE STREETS ARE SO NARROW.
UM, BUT HEARING THAT IT'S ROUGHLY $19 BILLION TO, UM, PUT UNDERGROUND LINES ALL ACROSS THE CITY, I THINK IS SOMETHING THAT WOULD BE GREAT FOR A PUBLIC EDUCATION CAMPAIGN.
UH, LETTING CONSTITUENTS KNOW THAT, UM, WHILE WE UNDERSTAND THE NEED TO ADDRESS, UH, THE UNDERGROUNDING OF THE, THE UTILITIES, IT IS VERY EXCESSIVE, RIGHT? AND WE HAVE TO PAY FOR THAT.
UH, AND I, I, WE WILL SAY AT LEAST ONCE A WEEK, OUR CONSTITUENT SERVICES TEAM GETS A CALL ABOUT, UM, THE NEED TO, UM, LAY THE, THE UNDERGROUND UTILITIES COUNCILWOMAN.
LEMME JUST SAY, UM, IF THERE'S A POLE IN THE MIDDLE OF A SIDEWALK, THAT YOU PROBABLY JUST GET THAT TO US AND LET US SEE WHAT OUR OPTIONS MIGHT BE TO, TO MOVE IT.
I MEAN, WE, WE CERTAINLY ACCESSIBILITY'S IMPORTANT TO US TOO.
SO, UM, IF, IF, YOU KNOW, IF IF SOMEONE IN A WHEELCHAIR CAN'T GET PAST OUR POLE ON A SIDEWALK, THAT'S SOMETHING THAT, THAT WE SHOULD BE ABLE TO RECONCILE.
SO, SO DON'T ASK US, AND LET US TAKE A LOOK AT WHAT THE OPTIONS ARE BEFORE YOU JUST KIND OF, OF GIVE UP ON THAT.
I, I THINK WE CAN WORK TOGETHER.
AND, AND AGAIN, WITH THE SUPPLY CHAIN PRESENTATION, I, I THINK IT'S VERY INFORMATIVE AND, UH, I DON'T KNOW IF IT'S A LOT TO ASK FOR.
I THINK A COMMERCIAL WOULD BE VERY BENEFICIAL FOR THE PUBLIC TO UNDERSTAND THE DIFFERENT MOVING PIECES, RIGHT.
TO THIS, THIS, UH, BIG ORGANIZATION, JUST THE SUPPLY CHAIN.
UM, BUT THOSE ARE ALL MY COMMENTS.
OH, YOU HAVE SOMETHING TO ADD? MY CHAIR ASKED ME TO JUST, WE CAN DEVELOP AN INFOGRAPHIC THAT EDUCATES THE COMMUNITY ON OVERHEAD VERSUS UNDERGROUND AND, YEAH.
AND I WANNA THANK ALL THE WOMEN THAT CAME OUT AND PRESENTED TODAY.
I SEE Y'ALL, UH, AT THE RAC COMMITTEE.
ROMERO, THANK YOU FOR JUMPING IN.
I THINK APPOINTING YOU TO, UH, C P SS WAS ONE OF THE FIRST THINGS I DID AS A COUNCILMAN AND CHAIR GONZALEZ, YOU'VE BEEN AMAZING IN TERMS OF MOVING US FORWARD OUT OF WHERE WE WERE.
UM, I, I WANNA JUST, I JUST HAVE SOME BRIEF RECOMMENDATIONS.
THE OPERATIONAL, UH, EFFICIENCY APPROACH.
WHAT I SAW IS, WHAT I WOULD LIKE TO HAVE IS C P S COME BACK TO THE COUNCIL AT A B SESSION AND LET US KNOW HOW THE PROGRESS ON THOSE RECOMMENDATIONS ARE GOING UP, UPDATE ON WHAT WAS SUCCESSFUL AND THE COST EFFICIENCY.
THE ONE THING I'D LIKE Y'ALL TO REMEMBER ABOUT THE SOUTH SIDE IS A LOT OF, A LOT OF MY RESIDENTS ARE IN LOVE WITH THEIR GAS STOVES.
UM, AND THAT IS SOMETHING THAT IS GONNA HAVE TO BE ADDRESSED WHEN, AS YOU GO OUT INTO THE COMMUNITY.
THE OTHER THING IS, AS WE TALK, UH, C P S TALKS ABOUT SUNING, POSSIBLY THE RATE ADVISORY COMMITTEE.
I THINK YOU HAVE A LOT OF PEOPLE SERVING ON THAT COMMITTEE, UH, THAT WERE APPOINTED BY THE COUNCIL MEMBERS.
I THINK OF THE DISTRICT FOUR REPRESENTATIVE AND DISTRICT TWO THAT ARE READY TO HELP WITH SOLUTIONS FOR SOME OF THOSE RECOMMENDATIONS TOO.
SO I, I THINK YOU HAVE THE COMMUNITY MEMBERS READY TO GO, UH, THERE ON THE UNDERGROUND IT UNDERGROUND GROUNDING.
I WANT IT WHERE IT CAN BE DONE.
AND I WOULD LOVE TO FIND THE INVESTMENTS FOR MORE FUNDING, BUT THE OVERWHELMING MESSAGE I HEAR FROM MY RESIDENTS, WHAT I HEARD ON THE, WHAT I HEAR ON THE RATE ADVISORY COMMITTEE IS AFFORDABILITY AND RELIABILITY.
AND I, AND SO I AM IN AGREEMENT WITH, UH, COUNCILMAN CASTILLO THAT WE GET THAT INFOGRAPH INFOGRAPHIC, AND THAT YOU INCLUDE THAT AFFORDABILITY AND RELIABILITY IN TERMS OF SOMETHING GOES WRONG WHEN IT'S UNDERGROUND.
HOW LONG IS IT GOING TO TAKE FOR THEM TO FIX IT? UM, WHAT THE AFFORDABILITY IS, BECAUSE THAT'S THE BIG QUESTION.
BUT I WOULD LIKE THE CITY TO BE A LITTLE MORE, UM, THOUGHTFUL WHEN IT COMES TO OUR STREETS PROJECTS, IF WE DO HAVE A PROJECT WHERE THERE'S A POSSIBILITY TO PUT, UM, UH, C P SS UNDERGROUND OR, OR TO GO UNDERGROUND, OR IF THERE IS A POSSIBILITY TO MAKE SURE THAT THOSE POLES ARE IN A, IN A PLACE THAT GIVES US A, AN ULTRA ACCESSIBLE SIDEWALK.
UM, SO THAT'S, THOSE ARE MY THOUGHTS ON UNDERGROUNDING AND THEN ON THE SUPPLY CHAIN.
UM, THANK YOU FOR THE PRESENTATION AND, AND THAT YOU'RE MONITORING TO MAKE SURE THAT THEY KEEP QUALITY AND RELIABILITY.
'CAUSE I BELIEVE THAT THAT IS KEY.
AND I THINK WHEN WE HAVE AN OPPORT, WHEN WE HAVE A SITUATION LIKE THIS, UM, A LOT OF LESS THAN PRODUCTS START TO, TO FLOOD THE MARKET.
AND SO I'M, I'M GLAD THAT YOU GUYS ARE, ARE MONITORING THAT.
AND, BUT I WOULD ALSO LIKE FOR, UM, YOUR TEAM TO LET US KNOW WHAT WE AS
[01:15:01]
A CITY CAN DO TO MAYBE ENCOURAGE OUR FEDERAL REPRESENTATIVES TO HELP ALONG WITH THE, THE PROCESS.SO I THINK THAT'S ONE THING WE CAN DO AND, AND WE CAN HELP WITH SO THAT MAYBE THE MARKET GROWS A LITTLE, WE LOOK AT OUR TRADE RESTRICTIONS.
MAYBE THERE'S SOMETHING, YOU KNOW, I I ALWAYS THINK, UM, I ALWAYS THINK THAT SOUTH KOREA HAS GREAT PRODUCTS TOO, SO I'M NOT SURE WHAT WE CAN DO, BUT IF THERE'S SOMETHING THAT WE CAN DO, PLEASE LET US KNOW.
BUT THANK YOU FOR THE PRESENTATION.
I KNOW WE CAN'T GET IT ON THE CALENDAR RIGHT NOW, BUT, UM, HOPEFULLY WHEN WE GET BACK FROM THE SUMMER BREAK, WE CAN, WE CAN HEAR HOW THE PROCESS IS GOING WITH THOSE RECOMMENDATIONS.
HEY, UM, JUST BRIEFLY, UH, WE, YOU MENTIONED EARLIER, 180 MILLION, $189 MILLION IN, IN PAST DUE ACCOUNTS.
UM, AND I READ THAT THERE'S SORT OF BEEN AN UPTICK THERE OVER THE PAST FEW YEARS.
ANY PARTICULAR REASON, UH, FOR THE, FOR THE INCREASE? WELL, FIRST OFF, COUNCILMAN WHITE, CONGRATULATIONS AND WELCOME TO THE DAIS.
WE, BECAUSE OF THE PANDEMIC, WE THOUGHTFULLY, AND WITH COUNCIL APPROVAL, OUR BOARD AND COUNCIL ACTUALLY HAD TO PASS A RESOLUTION, ALLOWING US, UH, TO DO CERTAIN THINGS TO HELP OUR CUSTOMERS, UH, WHO ARE NOW OUTTA WORK OR WHATEVER THE CASE MIGHT BE.
SO DURING THE PANDEMIC, WE SUSPENDED DISCONNECTS.
AND AS, AND, AND AGAIN, WHEN YOU'RE NOT BEING DISCONNECTED, BALANCES WILL NATURALLY START TO RISE.
YOU DON'T HAVE THAT LEVER YOU CAN PULL.
UM, SO OVER TWO YEARS, IT ROWS UP TO ABOUT 200 MILLION.
AND OVER THE LAST YEAR, WE'VE BEEN TRYING TO BRING, UH, THAT, THAT NUMBER BACK INTO, INTO PLAY.
AND, AND IT TOOK US A COUPLE YEARS TO, TO GET THERE.
IT'S GONNA TAKE US A COUPLE YEARS TO GET OUT OF IT.
UM, IT, IT, IT, IT, IT IS A, A, AN ACCOUNTS RECEIVABLE.
WE CARRY ON OUR BALANCE SHEET, BUT, YOU KNOW, WE'VE GOT THE MONEY WE NEED TO RUN THE ORGANIZATION.
THE TEAM IS DOING THE WORK, THE WORK THEY NEED TO DO TO GET BACK TO WHERE WE NEED TO BE.
AND MOST OF THAT, UH, UH, 180 MILLION ISH THAT, THAT, THAT IS THERE TODAY IS ON PAYMENT PLANS.
UM, SO, YOU KNOW, AGAIN, THAT'S, THAT'S ALL WE CAN DO.
AND AS PEOPLE NEED TO CHANGE THEIR PAYMENT PLAN, WE, WE WORK WITH THEM TO TRY TO GET 'EM IN A PLACE WHERE THEY CAN PAY.
WHAT IT, WHAT IT MAINLY DOES FOR US TO GET 'EM ON A PAYMENT PLAN IS IT STOPS THE BLEEDING.
SO TO BE ON A PAYMENT PLAN, YOU, YOU CAN'T, YOU CAN'T CONTINUE TO NOT PAY.
YOU HAVE TO PAY YOUR CURRENT BILL, AND THEN YOU'VE GOTTA PAY WHATEVER YOU OWE PAST TO STAY ON THE PAYMENT PLAN.
AND SO THAT'S THE STRATEGY FOR WHY THAT'S, YOU KNOW, THAT'S HOW WE'RE GONNA GET OUT OF THIS.
AND THAT WAS GONNA BE ONE OF MY NEXT QUESTIONS.
IF THERE'S A DEFAULT ON THE PAYMENT PLAN, UM, THEY, THEY GET DISCONNECTED, THEY GET HIT WITH LATE FEES THERE, YOU KNOW, THERE'S RAMIFICATIONS OF, OF NOT COMPLYING WITH THE PAYMENT PLAN.
AND, UM, PRIOR TO C O I D, WHAT WAS THE USUAL ACCOUNTS RECEIVABLE? YEAH, THAT WAS PROBABLY DOWN AROUND 10, 15, $20 MILLION A YEAR.
SO I MEAN, IT'S A DRASTIC INCREASE.
AND, AND OVER WHAT PERIOD OF TIME ARE WE THINKING THAT WE CAN GET THIS 180 9 BACK DOWN TO THOSE LEVELS? IT'S GONNA TAKE US A COUPLE YEARS.
UM, THE RATE INCREASE THAT WAS MENTIONED EARLIER, THAT, THAT SEEMS TO BE HEADED OUR WAY.
YOU SAID THAT'S GONNA BE SOLELY BASED ON THE NEED FOR NEW TECHNOLOGY.
YEAH, SO NOT, THERE WON'T BE NOTHING NEW.
WE TALK ABOUT THIS NEXT GO ROUND THAT WE DIDN'T TALK ABOUT LAST GO ROUND.
THE LAST RATE INCREASE, UM, CONVERSATION WAS AROUND KIND OF FOUR KEY AREAS.
UM, YOU KNOW, WHAT STAFF ASKED US TO DO WAS TO, TO FINE TUNE THE ACTUAL COST OF WHAT WE WERE ASKING FOR.
WELL, LIKE RIGHT NOW, THE R F P IS OUT FOR OUR E R P SYSTEM, WE WILL KNOW EXACTLY WHAT THAT IMPLEMENTATION COST IS GONNA BE.
WE CAN COME BACK TO COUNCIL AND TALK ABOUT THAT.
SO, SO WHAT IT WILL BE IS JUST SPECIFICS ABOUT WHAT WE TALKED ABOUT LAST TIME, NOTHING MORE DECARBONIZATION, UM, OBJECTIVES AND THINGS LIKE THAT.
NONE OF THAT IS, IS GONNA BE, UH, UH, RELATED TO THIS, THIS COMING RATE INCREASE.
SO NOT NECESSARILY THIS RATE, RATE CASE CONVERSATION, BUT WE'VE, WE'VE GOT A PLAN THAT WE'VE APPROVED THAT MOVES US AWAY FROM COAL THAT WILL FIND ITS WAY INTO RATE IMPLICATIONS IN THE FUTURE.
SO I'M NOT GONNA STAND HERE AND TELL YOU THAT'S NOT COMING, BUT WE GOT SOME WORK TO DO BEFORE, AGAIN, WE KNOW EXACTLY WHAT THAT COST IS, AND WE CAN COME TALK TO YOU ABOUT THAT.
SO WE, WE CAN SAVE THOSE CONVERSATIONS FOR
UM, UH, THIS NEED FOR THE NEW TECHNOLOGY.
WE'VE SEEN THAT COMING FOR, FOR A WHILE, I ASSUME, WELL, WE'RE RUNNING THE EQUIVALENT OF WINDOWS 2000 AT C P S ENERGY.
OUR, OUR SYSTEMS, OUR BILLING SYSTEM, OUR ACCOUNTS PAYABLE, OUR PAYROLL SYSTEMS, ALL OUR SYSTEMS, OUR END OF LIFE, OUR VENDORS AREN'T EVEN RUNNING ANYMORE.
WE WENT EIGHT YEARS WITHOUT A RATE INCREASE.
WHEN YOU GO EIGHT YEARS WITHOUT A RATE INCREASE, YOU
[01:20:01]
DEFER THOSE TYPE OF INVESTMENTS.AND SO WE'RE AT A POINT NOW WHERE, YOU KNOW, WHETHER WE GET THE RATE INCREASE OR NOT, WE'RE GONNA HAVE TO SPEND THIS MONEY, UH, TO UPGRADE OUR SYSTEMS, OR WE'LL FIND OURSELVES IN THE SAME SITUATION.
YOU KNOW, SOUTHWEST AIRLINES WAS IN OVER THE LAST, YOU KNOW, HOLIDAY WHERE OUR SYSTEMS, YOU KNOW, UH, UH, FAIL US.
SO WE CAN'T ALLOW THAT TO HAPPEN.
UH, IT, IT'S A THREAT TO RELIABILITY.
SO, SO THIS INVESTMENT IS, IS NOT AT THIS POINT DISCRETIONARY.
AND, AND IS THERE ANY, UH, UH, CLIFFNOTES VERSION OF, OF WHAT EXACTLY THIS NEW SOFTWARE WILL DO THAT, THAT THE OLD ONE DOESN'T? IT IS AN UPGRADE TO A, A VERY OLD ENTERPRISE SYSTEM.
SO WHATEVER SYSTEM YOU USE FOR, AT YOUR LAW FIRM, FOR INSTANCE, TO RUN, TO BILL YOUR CUSTOMERS, AND IT'S THAT SYSTEM, BUT IT'S A VERY OLD VERSION OF THAT SYSTEM THAT'S STILL, YOU KNOW, UM, UM, AGAIN, YOU KNOW, WE, IN ORDER TO CREATE NEW RATES AND TO DO THE THINGS OF THE FUTURE THAT ARE GONNA REQUIRE US TO MOVE INTO THE FUTURE, WE'VE GOT TO MAKE THIS SYSTEM UPGRADE.
AND IT AIN'T GONNA HAPPEN OVERNIGHT.
IT'S, IT'S A FIVE YEAR PROCESS.
SO, UH, IT IS A REAL, I MEAN, THIS IS OUR NUMBER ONE PRIORITY RIGHT NOW, IS THIS E R P SYSTEM UPGRADE.
UM, MY LAST QUESTION IS IN TERMS OF LA LABOR, UM, HOW DOES IS C P S COMPETITIVE WITH THE OTHER COMPANIES AROUND THE CITY IN TERMS OF, UH, ATTRACTING AND THEN RETAINING TALENT? WELL, I TELL YOU, YOU KNOW, YURI WAS TOUGH ON US.
WE LOST A LOT OF GOOD PEOPLE BECAUSE THEY JUST GOT TIRED OF GETTING BEAT UP EVERY DAY.
AND SO THE LAST, UH, RATE CASE CONVERSATION WE HAD WITH COUNCIL, ONE OF THE ELEMENTS OF THAT DISCUSSION WAS TALENT MANAGEMENT.
YOU KNOW, WE'VE IMPLEMENTED STRATEGIES, WE'VE DONE MARKET MATCHING, WE'VE DONE A LOT OF WORK, UH, TO ALLOW US TO SHORE UP, UH, THE PEOPLE THAT WE NEED.
AND WE'RE A GROWING COMMUNITY, WE'RE GROWING IN EVERY DIRECTION.
SO WE'RE GONNA NEED MORE PEOPLE AS OUR SYSTEM GROW GROWS, JUST TO MANAGE, UM, YOU KNOW, A, A GROWING SYSTEM.
WE'RE AT THE TAIL END OF OUR TALENT MANAGEMENT STRATEGY THAT'S ALLOWED US TO SHORE UP OUR PEOPLE NEEDS.
LOOK, I GOTTA TAKE CARE OF MY PEOPLE.
IF I DO THAT, OUR PEOPLE WILL TAKE CARE OF OUR CUSTOMERS.
AND, AND WE'VE BEEN FOCUSED ON THAT TRACK FOR THE LAST TWO YEARS.
AND I THINK THE TEAM HAS DONE A REALLY GREAT JOB OF DOING WHAT WE NEED TO DO TO GET IN A BETTER PLACE.
UH, FIRST OF ALL, THANK YOU VERY MUCH FOR THE REPORTS.
UM, I REALLY ENJOYED LISTENING TO WHAT IS COMING IN THE FUTURE, BUT I HAVE A COUPLE OF QUESTIONS.
WELL, BEFORE I DO THAT, LET ME JUST SAY THIS.
I REALLY WANT TO CONGRATULATE YOU, AND THANK YOU ALSO FOR THE FARES THAT YOU DO IN OUR DISTRICTS, BECAUSE THEY'RE VERY USEFUL.
UM, I WENT TO THE LAST ONE IN SEVEN AND THERE WERE LOTS OF FOLKS THERE AND INCLUDING CHILDREN LEARNING EARLY ABOUT ENERGY.
UH, AND PEOPLE ENJOYED THE FAIRES AND THEY LEARNED A GREAT DEAL.
SO I HOPE THAT YOU'LL CONTINUE THOSE IN OUR DISTRICTS BECAUSE THEY'RE VERY VALUABLE.
THE FIRST ONE IS, DO YOU ALREADY HAVE A PLAN FOR THE UNDERGROUND, WHERE THE UNDERGROUND WILL BE PUT? UH, YES.
SO EVERY EVERY YEAR WE'LL GO THROUGH AND WE LOOK AT THIS, THE ENTIRE SYSTEM, AND LIKE RUDY, LIKE, UH, RICK WAS MENTIONING, UM, THEY'LL LOOK AT SEGMENTS WHERE WE'RE HAVING, UH, DIFFICULTIES RESTORING POWER, UH, YOU KNOW, 'CAUSE A LOT OF THE LINES WERE BUILT A LONG TIME AGO, AND SOME OF THEM ARE IN ALLEYS AND YOU KNOW, THE CITY IS NOT MAINTAINING SOME OF THOSE OLD ALLEYS AND THERE'S A LOT OF VEGETATION AND GROWTH AND YOU CAN'T GET VEHICLES BACK THERE.
SO SOME OF THE AREAS WHILE IDENTIFY AND THEN WE'LL, WE'LL TARGET THOSE AREAS BECAUSE OF THE RELIABILITY AND THE DIFFICULTY ON RESTORING POWER, THEN WE WILL, WE'LL, UNDERGROUND 'EM, WE'RE HAVING TO MOVE 'EM TO THE FRONT IN, IN THE, IN THE, IN THE RIGHT OF WAY.
WELL, I GUESS SEVERAL OF THE COUNCIL MEMBERS HAVE EXPRESSED, UH, THE NEED TO MAKE SURE THAT, UH, WE SEE THIS UNDERGROUND HAPPENING IN ALL THE DISTRICTS ARE AND THOSE DISTRICTS THAT PARTICULARLY NEED IT.
UM, CAN WE SEE THAT PLAN? UH, YES, WE CAN PROVIDE THAT TO YOU.
THAT, THAT WOULD BE GREAT IF WE COULD TAKE A LOOK AT IT.
I'M SURE WE'D BE VERY INTERESTED.
COUNCIL MEMBER CASTRO, ANY FURTHER CONVERSATION ON OUR SPECIAL SESSION WITH C P SS.
THANK YOU VERY MUCH TO OUR C P S EIGHT JOB, TO OUR, UH, ENERGY EXECS AS WELL AS OUR BOARD.
ALRIGHT, THE TIME IS 2:30 PM ON THE FIRST DAY OF JUNE, 2023.
I WILL ADJOURN OUR SPECIAL MEETING.