[1. Briefing by CPS Energy on the 2019 summer outlook, utility readiness, and an overview of the customer education and awareness campaigns. [Paula Gold-Williams, CPS Energy President and CEO]]
[00:00:06]
>> MAYOR, WE DO HAVE A QUORUM PRESENT.
I BELIEVE THEY'RE TAKING THEIR SEATS NOW, MAYOR.
MAYOR, THERE IS SIX PRESENT, SO YOU DO HAVE A QUORUM AND WE CAN START THE PRESENTATION.
WELCOME TO OUR CITY COUNCIL SPECIAL MEETING UTILITY BRIEFING TODAY.
OUR FIRST AND ONLY ITEM IS OUR CPS ENERGY PRESENTATION.
TURN IT OVER TO OUR CITY MANAGER, ERIK WALSH.
>> WALSH: THANK YOU, MAYOR AND COUNCIL.
THIS IS PART OF OUR ONGOING PROCESS OF KEEPING THE COUNCIL INFORMED OF THE ACTIVITIES OF OUR CITY-OWNED UTILITIES, CPS AND SAWS.
TODAY'S PRESENTATION WILL BE MADE BY PAULA GOLD-WILLIAMS, PRESIDENT AND C.E.O. OF CPS ENERGY.
AND WILL COVER THREE PRIMARY AREAS.
ONE IS THEIR COMMUNITY OUTREACH EFFORTS, TWO, THE PREPARATION AND READINESS FOR THE SUMMER MONTHS, AND THEIR SUMMER MARKETING AND EDUCATION CAMPAIGN.
WITH THAT I'LL TURN IT OVER TO PAULA TO KICK US OFF.
I HAVE A LOT OF SLIDES, A LOT OF THINGS GOING ON, BUT I'M GOING TO MOVE VERY, VERY QUICKLY AND TRY TO MAKE SURE THAT THERE IS PLENTY OF TIME FOR YOU TO PICK AND CHOOSE WHAT YOU WOULD LIKE TO TALK ABOUT.
SO I HAVE A LOT OF CATEGORIES BUT I'M JUST GOING TO JUMP RIGHT INTO IT.
THE FACT OF THE MATTER IS AGAIN THAT OUR INDUSTRY, WE'VE BEEN AROUND FOR 159 YEARS.
AND THE INDUSTRY HASN'T CHANGED A LOT, TECHNOLOGICALLY, PARTICULARLY AT THE GENERATION SIDE OF THE BUSINESS.
AND SO WE SEE AND UNDERSTAND THAT THERE'S A LOT OF EVOLUTION HAPPENING.
THERE'S A LOT OF INTEREST IN ENERGY.
THERE'S A LOT OF -- FROM THE TECHNOLOGY PERSPECTIVE, FROM THE ENVIRONMENTAL PERSPECTIVE, FROM VERY MUCH TRYING TO THINK ABOUT HOW WE CAN BE MORE EFFICIENT IN THE FUTURE.
AND, FOR US, WE ARE VERY INTERESTED IN TAKING IN THAT INPUT.
WE'RE VERY INTERESTED IN GETTING INPUT FROM OUR PARTNERS.
AND A LOT OF THEM ARE ALL OVER THE GLOBE.
BUT WE ALSO VERY MUCH LIKE TO FOCUS ON THE INPUT THAT WE GET LOCALLY.
SO I JUST WANTED TO HIGHLIGHT THAT RECENTLY THIS WEEK, JUST A MATTER OF FACT IT HAPPENED TO BE THE SAME WEEK, WE MET WITH OUR ENVIRONMENTAL STAKEHOLDERS.
WE HAVE BEEN MEETING WITH OUR ENVIRONMENTAL STAKEHOLDERS FOR PROBABLY OVER FOUR YEARS.
WE TRY TO MEET, AT A MINIMUM, QUARTERLY.
CHRIS, OUR COO, IS THE LEAD ON THAT, BUT HE ALSO MAKES SURE THAT HE'S AVAILABLE TO TALK IN BETWEEN THOSE MEETINGS.
WE THINK THE INPUT THAT WE GET FROM THEM IS VERY HELPFUL.
THERE'S A LOT OF GOOD THINGS THAT WE HAVE TO TALK ABOUT IN THE FUTURE.
WHAT ARE WE GOING TO DO IN THE FUTURE.
ULTIMATELY, I THINK I SAW MARIO BRAVO HERE.
HE ACTUALLY HEADS THE COMMITTEE FROM THE OTHER SIDE, FROM THE ENVIRONMENTAL SIDE.
WE ARE GETTING TO THE POINT WHERE WE HAVE BEEN ASKED TO KIND OF GENERATE MORE DIALOGUE.
WE'VE BEEN SHARING INFORMATION.
THERE'S MORE INFORMATION TO SHARE.
THEY ASKED FOR MORE DIALOGUE, SO WE'RE RETHINKING THOSE MEETINGS.
FOR EXAMPLE, ONE OF THE REQUESTS WAS FOR US TO MEET AT NIGHT, AND WE'RE GOING TO TRY THAT NEXT MEETING AT NIGHT TO SEE IF WE CAN GET MORE STAKEHOLDERS AT THAT MEETING.
THIS WAS AN EVENT THAT WE HAD.
ACTUALLY COUNCILMAN COURAGE WAS ABLE TO HELP KICKOFF THAT EVENT.
WE DID HAVE A PANEL DISCUSSION.
WE HAD AN ENVIRONMENTAL PERSPECTIVE, THE ENERGY PERSPECTIVE, SOLAR.
AND BASICALLY WERE INTERVIEWED BY THE BROWARD REPORT .
IT WAS A GOOD EXCHANGE AND THE COMMUNITY WAS ABLE TO ASK US QUESTIONS AND WE TALKED ABOUT COAL AND HOW WE MOVE FORWARD.
I WOULD IMAGINE WE WOULD HAVE MORE CONVERSATIONS LIKE THAT.
PART OF ENERGY EVOLUTION WILL INCLUDE CHANGING VEHICLES.
AND SO WE ARE MONITORING HOW THAT IS PROGRESSING.
WE HAVE BEEN WORKING WITH ELECTRIFY AMERICA.
WE HAD SOME CONVERSATIONS WITH TESLA.
AND I THINK WE'RE GOING TO TRY TO ENCOURAGE MORE AND MORE PEOPLE TO HELP PUT IN MORE INFRASTRUCTURE MORE CHARGING STATIONS.
AND I KNOW THE CITY IS DOING SOME THINGS, SO WE LOOK FORWARD TO BEING ABLE TO COLLABORATE FROM THAT PERSPECTIVE.
ANOTHER PART WHERE WE'RE THINKING ABOUT PART OF CHANGING THE EVOLUTION OF THE INDUSTRY IS INCREASING THE DIALOGUE AND SUPPORTING THOUGHT LEADERSHIP.
[00:05:01]
SO WE WERE VERY HAPPY THAT WHEN THE DARMSTADT DELEGATION CAME IN TO VISIT WITH THE CITY OF SAN ANTONIO, WE WERE ABLE TO GET THEM TO PARTICIPATE IN THAT.WE HAD MEMBERS FROM AUSTRALIA AND DIFFERENT PARTS OF THE NATION.
WE ARE NOW ATTRACTING THAT CONVERSATION AND PARTICIPATION IN SAN ANTONIO.
SO HERE ARE A COUPLE OF SLIDES OF THIS ONE.
WE HAD MULTIPLE PANELS, YOU CAN SEE.
ALSO ONE OF OUR SISTER CITIES HAS THE EXACT SAME AGE AS WE DO, ACTUALLY HAS A COUNCILMAN THAT IS VERY ACTIVE THAT CAME TO THAT MEETING AND REALLY KIND OF HELPED SHARE WHAT'S HAPPENING IN THE UNITED STATES AND HOW THEY'RE LOOKING AT SMART CITY PROGRESSION, FOR EXAMPLE.
AND THIS IS THE SAMPLE OF THE SLIDE WHERE WE HAD THE C.E.O. OF INTEGA RUNNING A HUGE ENERGY COMPANY.
WHAT WAS INTERESTING, THEY ARE LOOKING AT A LOT OF THE SAME ISSUES.
EVEN THOUGH IT'S HALFWAY ACROSS THE GLOBE, THEY HAVE THE SAME CHALLENGES THINKING ABOUT HOW ARE THEY GOING TO MOVE THEIR ENERGY INDUSTRY ALONG.
A COUPLE OF HIGHLIGHTS, WE HAVE A VERY DIVERSIFIED PORTFOLIO, WHAT WE'RE GOING TO DO WITH THE CARBON AND EMISSIONS.
AND FOR US WE'RE TAKING INPUT FROM CAP AND THINKING ABOUT THE FLEXIBLE PATH AND TRYING TO SHAPE AS A COMMUNITY DIALOGUE WHAT TO DO IN THE FUTURE.
IN TALKING TO THE C.E.O. OF INTEGA, THEIR APPROACH IS THEY ARE GOING TO BE SOLAR AND GAS, AND THAT'S THEIR PLAN FOR RIGHT NOW.
THEIR COUNTRY HAS DECIDED TO SUPPORT THAT, TO TAKE OUT NUCLEAR AND TO TAKE OUT COAL AND TO END UP MAKING SURE THAT THE FINANCIAL SUPPORT AROUND THAT IS REALLY A COUNTRY ISSUE.
SO WE CONTINUE TO STUDY HOW THAT PROGRESSES AND HOW THAT WILL MOVE FORWARD.
BUT A VERY INTERESTING DIALOGUE AND A POINT OF REFERENCE FOR US.
I WANTED TO HIGHLIGHT THIS, THE NEW ENERGY ECONOMY.
YOU KNOW, WE HAVE HAD THE NEW ENERGY ECONOMY FOR OVER FIVE YEARS NOW.
AND THIS, AGAIN, IS WHERE WE INVITE ENTITIES FROM ACROSS THE GLOBE AND NATION TO COME TO SAN ANTONIO AND NOT ONLY BRING THEIR BUSINESS, BUT BRING JOBS AND SUPPORT ECONOMIC DEVELOPMENT AND SUPPORT EDUCATION.
WHAT'S FASCINATING ABOUT THIS IS WE ALSO ARE TELLING THEM TO ACTUALLY LAUNCH THEIR BUSINESSES AND GROW THEM OUT OF THE SAN ANTONIO MARKET.
I WANTED TO HIGHLIGHT THIS ONE BECAUSE THIS IS A RECENT CONTRACT WITH MEXICO WHERE THEY HAVE A BIG CONGLOMERATION AND THEY'RE ABLE TO DO BUSINESS IN THAT COUNTRY AND THEY'RE LOOKING TO USE MOST OF THE SUPPLY CHAIN FROM THE NEW ENERGY ECONOMY FOR THAT.
WE LOVE IT BECAUSE IT WAS SELF-GENERATED.
THEY'RE MOVING THE INDUSTRY ALONG.
THEY'RE REALLY BENEFITING THE LOCAL ECONOMIC DEVELOPMENT WHILE MAKING SURE THAT THEY'RE PART OF THE ENERGY EVOLUTION.
RECENTLY CHRIS WAS ABLE TO DO AND PRESENT AT THE COMMITTEE FOR COUNCILMAN PELAEZ.
WE VERY MUCH ARE VERY INTERESTED IN THE FOCUS THAT HIS TECHNOLOGY COMMITTEE IS DOING AND LOOKING AT WHAT WE CAN DO IN THE FUTURE, FOCUSED ON NEW TOOLS, NEW RESILIENCY OPPORTUNITIES, THAT KIND OF THING.
AND HERE ARE SOME THINGS NOW THAT WE MOVE FROM THE INDUSTRY OUT TO COMMUNITIES.
WE ARE TRYING OUR BEST TO CONTINUE TO DO ALL TYPES OF OUTREACH IN THE COMMUNITY.
HERE'S AN EXAMPLE WHERE WE HAD THE CUB SCOUTS COME IN.
THEY ASKED ALL KINDS OF QUESTIONS BUT VERY MUCH WE SUPPORT THAT.
ONE OF OUR VICE PRESIDENTS IS ACTUALLY A SPONSOR OF THE BOY SCOUTS.
SO WE LOOK AT WAYS THAT WE CAN GET OUR EXECUTIVES INVOLVED BASED UPON THEIR INTERESTS AND THE NEEDS OF THE COMMUNITY.
ABOUT A YEAR AGO, MAYBE A LITTLE OVER A YEAR AGO, WE BOUGHT A BIG VAN THAT WE USE AS PART OF OUR SUPPORT TO THE COMMUNITY.
WE CAN ACTUALLY DO INTAKE, EDUCATION, SAFETY, AND ALL THE PROGRAMS THAT WE HAVE.
AND WE USE IT AS OFTEN AS WE CAN, BUT WE DECIDED TO MAKE AN INVESTMENT IN A SMALLER VEHICLE WHERE WE CAN DO MORE COMMUNITY OUTREACH.
WE CAN GO TO WHERE THE CUSTOMERS ARE, BE CONVENIENT TO THEM AND ALSO HAVE OUR TECHNOLOGY TO HAVE THOSE MATERIALS THERE, SIGN PEOPLE UP, GET THEM INTO PROGRAMS AND REALLY BE HELPFUL.
SO THIS IS JUST AN EXPANSION OF THAT PROGRAM THAT WE HAVE.
RECENTLY THE MAYOR SPONSORED THE UNITED NEGRO COLLEGE FUND.
IT WAS THE BIGGEST FUNDRAISER LUNCHEON IN THE NATION AND IT WAS EXTREMELY SUCCESSFUL.
WE WERE VERY PROUD TO PARTICIPATE IN THAT.
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YOU SEE EXECUTIVES AND YOU SEE PEOPLE THAT MAKE TIME FOR THE COMMUNITY.ONE OF OUR PASSIONS IS CHILDREN AND BEING HELPFUL TO CHILDREN.
WE ACTUALLY HAVE A LITERACY PROGRAM WHERE PEOPLE FROM THE FIELD CAN BE OFF OF WORK AND GO TO SCHOOLS AND HELP DIFFERENT SCHOOLS AND STUDENTS IN LEARNING.
BUT WE ALSO HAVE JUST GOING OUT AND TALKING ABOUT SAFETY AND LETTING CHILDREN KIND OF TOUCH OUR PERSONAL PROTECTION EQUIPMENT, TO TRY IT ON, GET USED TO IT, ASK THEM QUESTIONS.
IT'S A LOT OF FUN FOR THE KIDS.
A LOT OF FUN FOR OUR TEAM MEMBERS.
WE CONTINUE TO SUPPORT ECONOMIC DEVELOPMENT RELATIVE TO THE PIPELINE OF TALENT.
SO RUDY GARZA, ONE OF OUR SENIOR VICE PRESIDENTS, SUPPORTED AN EVENT AND WAS OUR REPRESENTATIVE AT THE JOB SHADOWING PROGRAM AT LA VILLITA.
I KNOW WE'RE TRYING TO HAVE STUDENTS GET SUMMER JOBS.
THESE ARE A COUPLE OF SLIDES ABOUT OUR PUBLIC INPUT SESSION.
WE DID THREE PUBLIC INPUT SESSIONS AT LA VILLITA LAST YEAR.
I HAD COUNCILWOMAN COUNCILWOMANW UP AND COUNCILMAN COURAGE WAS ALSO THERE.
AND WHAT WE HAD IS DOUG MELNICK DID A VERY GOOD PRESENTATION ON CAP.
I TALKED ABOUT THE FLEXIBLE PATH.
AND WE WERE ABLE TO GET ADDITIONAL INPUT ON BOTH OF THOSE.
WE CONTINUE TO DO OUR COMMUNITY OUTREACH.
ONE OF THE THINGS THAT HAPPENED, I THINK, ABOUT FIVE YEARS AGO, THE COUNCIL AT THE TIME ASKED US TO MAKE SURE THAT WE ARE GOING OUT AND CONDUCTING FARES FOR ENROLLMENT PROGRAMS, THOSE KIND OF THINGS.
WE WILL CONTINUE TO CREATE THAT OUTREACH.
YOU TELL US WHERE YOU WANT US TO GO IN OUR DISTRICTS AND WE WILL BE THERE.
YOU CAN SEE IT FINALLY HAS STOPPED LOOKING LIKE JUST A BUNCH OF BEAMS. AND NOW WE HAVE THE SIDES COMING UP.
AND RECENTLY COUNCILMAN PERRY WAS ABLE TO MAKE A VISIT, A HARD HAT TOUR OF THAT LOCATION.
ANY COUNCIL MEMBER WHO WOULD LIKE THAT TOUR, PLEASE LET US KNOW AND WE WOULD BE GLAD TO ACCOMMODATE THAT, BUT HERE IS ONE OF THOSE PICTURES.
ADDITIONALLY, WE HAVE -- ONCE WE MOVE INTO THE NEW LOCATION, THE CURRENT COMPLEX THAT WE HAVE WILL OF COURSE BE AVAILABLE FOR SALE.
AND WE HAVE OTHER PROPERTIES ACROSS TOWN THAT WE ARE PUTTING UP FOR SALE.
AND THAT IS HELPING US MITIGATE THE COST OF THE BUILDING.
SO THAT MARKETING LAUNCH HAPPENED RECENTLY AND WE'RE IN A PERIOD NOW WHERE INTERESTED BUYERS ARE VERY MUCH ABLE TO GO OUT AND SEE WHAT'S AVAILABLE.
NOW, IT IS ACTUALLY ATTRACTING A TREMENDOUS AMOUNT OF ATTENTION GLOBALLY.
IT'S DESIGNATED, PART OF IT, AS AN OPPORTUNITY ZONE, PARTICULARLY OUR HEADQUARTERS BUILDING.
IT'S EXCITING TO SEE PEOPLE STARTING TO CALL AND EXPRESS INTEREST FOR WHAT COULD BE OUR CURRENT FACILITY.
AND SO IT'S A WIN-WIN FOR THE COMMUNITY.
ALSO, WHAT WE LIKE TO DO IS ALSO MAKE SURE THAT WE PUT IN AND USE TECHNOLOGY.
SO WE ARE REININSTITUTING OUR LIVE CHAT OPPORTUNITIES WITH CUSTOMERS.
WE'RE PUTTING EXECUTIVES AND MANAGERS AVAILABLE TO ANSWER QUESTIONS ONLINE.
SO I WANTED TO HIGHLIGHT THAT THAT IS ALSO AVAILABLE TO OUR COMMUNITY.
WE RECENTLY WERE HONORED AGAIN FOR OUR CONTINUED INVESTMENT IN RENEWABLES.
WE HAVE UTILITY SCALE, PROBABLY OVER 650 MEGAWATTS, UTILITY SCALE AND DISTRIBUTION ASIDE FOR SOLAR.
BUT THIS ACTUAL AWARD ACTUALLY MEASURES THE SOLAR WITHIN THE CITY PROPER FOR SAN ANTONIO.
AND WE WERE STILL IN THE TOP TEN.
WE ARE NUMBER ONE IN THE STATE OF TEXAS.
AND IN THAT ONE, COUNCILWOMAN SHIRLEY GONZALES WAS ABLE TO JOIN US, SO THAT WAS A REALLY GREAT DAY.
WE ALSO RECENTLY -- IN AN INDUSTRY ORGANIZATION, A RECOGNITION FOR BEING ENVIRONMENTAL CHAMPIONS.
YOU KNOW, THE FOCUS IS ENERGY COMPANIES ACROSS THE GLOBE, IF NOT THE NATION, ARE REALLY TRYING TO FIGURE OUT HOW TO MAKE CHANGES AND IMPROVEMENTS.
VERY MUCH I THINK WE'VE GOTTEN CREDIT FOR THE DEALY CLOSURES FOR OUR BIG ENERGY EFFICIENCY AND CONSERVATION PLAN FOR OUR ACTIVITIES.
WE KNOW OUR JOB IS NOT DONE BUT IT WAS A GOOD MILESTONE AWARD FOR 2019.
AND THEN OUR CUSTOMER SERVICE FOCUS.
I MEAN, I THINK WHEN I STARTED COMING TO YOU ALMOST FOUR YEARS AGO TALKING ABOUT OUR CUSTOMER SERVICE, WE HAD LOTS OF CHALLENGES.
TECHNICALLY WE WERE TRYING TO PUT IN A NEW CUSTOMER WEB
[00:15:04]
PORTAL.WE WERE HAVING PROBLEMS WITH OUR PHONE SYSTEMS. AND A LOT OF THINGS WEREN'T WORKING RIGHT.
BUT WE PUT A TREMENDOUS AMOUNT OF FOCUS ON ALL OF THAT PLUS TRAINING.
AND SO IT HAS ENDED UP TO WHERE OUR CUSTOMER SERVICE IS REALLY GETTING TO BE TOP IN THE INDUSTRY.
SO WE HAVE NOW BEEN ANSWERING THE PHONE IN 30 SECONDS, OVER 90% OF THE TIME, WHICH IS A BIG CHANGE FROM WHERE WE WERE.
WE WERE PROBABLY BELOW 50% OF THE TIME AT ONE POINT IN TIME.
I WOULD LIKE TO SHARE WITH YOU A COUPLE OF THINGS THAT RELATE TO HOW WE OPERATE.
AND, OF COURSE, YOU EXPERIENCE THE SAME STORMS THAT EVERYONE ELSE DOES.
BUT WHAT I LIKE TO HIGHLIGHT IS WHY IT'S NOT ALWAYS CLEAR.
WHAT HAPPENS FOR US IS THAT LIGHTNING ACTIVITY IS SOMETHING THAT, YOU KNOW, IT RESONATES BECAUSE IT IS ATTRACTED TO OUR DISTRIBUTION SYSTEMS. AND SO IT CAN ACTUALLY CAUSE DISRUPTION, IT CAN BRING POWER LINES DOWN.
IT CAN CREATE UNSAFE AREAS AROUND WHERE THAT LIGHTNING HAS STRUCK.
THIS IS SOME DAMAGE THAT WAS DONE RECENTLY THAT WE HAD TO RESTORE.
THIS IS A SITUATION WHERE THE LINE CAUGHT FIRE AND WE HAD TO MAKE SURE THAT THE CUSTOMER WAS SAFELY SECURE AND AWAY FROM THAT WHILE WE WERE ABLE TO GET ANOTHER CHALLENGE, THOUGH, A LITTLE BIT DIFFERENT FOR CHALLENGES THAT ARE OPPORTUNITIES, OUR PEOPLE ARE OUT ALL THE TIME.
AND THEY -- MANY TIMES, EVEN FOR THE FIRE DEPARTMENT, WE NEED TO BE THERE BEFORE THE FIRE DEPARTMENT OFTENTIMES GOES IN A BUILDING TO MAKE SURE THE POWER IS APPROPRIATELY CUT OFF.
WE NEED TO MAKE SURE OUR PEOPLE ARE GETTING THINGS DONE, SO THE COMMUNITY CAN OPERATE EFFECTIVELY AS THEY WISH.
WHAT WE HAVE EXPERIENCED FOR A VERY LONG TIME AND INTENSELY, IT HAPPENED, WE SAW IT A LOT AROUND WHEN THE TORNADOES CAME IN, A LOT OF PEOPLE ARE NOT DRIVING SAFE WHEN OUR PEOPLE IN THE WORK AREAS.
AND LAST YEAR WE HAD ONE OF OUR EMPLOYEES HIT, JUST IN THE MORNING, CONES OUT, WORKING.
SOMEBODY WENT THROUGH THE COPNE AND HIT THEM.
IT HAS BEEN A PASSION OF OURS TO GET SAFETY DESIGNATIONS FOR OUR EMPLOYEES.
OUR EMPLOYEES GOT SIGNED THIS WEEK BY THE GOVERNOR, ARE NOW INCLUDED AND FIRST RESPONDER STATUS, AND BASICALLY DRIVERS ARE REQUIRED TO MOVE OVER WHEN THEY SEE OUR WORKERS IN THE FIELD.
SO WE'RE VERY, VERY EXCITED ABOUT THAT.
WE'RE GOING TO PUT TOGETHER OUR OWN CAMPAIGN TO TALK ABOUT SAFETY, TRY TO PARTNER WITH THE CITY ABOUT THAT, AS WELL AS THERE'S THINGS WE CAN DO WITH TEX DOT AND OTHER ENTITIES ACROSS THE STATE.
THE ADVISORY COMMITTEE, MOST OF THE MEMBERS OF THE COMMITTEES, 10 OF THE 15 ARE DESIGNATED BY YOU.
AND THEN THE OTHERS ARE AT-LARGE MEMBERS.
WE ALSO ENSURE THAT THEY GET UP TO AUSTIN DURING THE LEGISLATIVE SESSION, AND VERY MUCH ARE ABLE TO MEET REPRESENTATIVES, TALK TO THEM ABOUT ENERGY ISSUES, AND REALLY KIND OF MAKE THAT CONNECTION GOING FORWARD, SO THAT WAS A VERY SUCCESSFUL VISIT RECENTLY.
THIS IS ANOTHER EXAMPLE OF A FIRST RESPONDER ISSUE THAT WE DID RECENTLY.
YOU PROBABLY SAW THIS, WE GOT A PHONE CALL FROM THE FIRE DEPARTMENT.
ONE OF THE WORKERS THAT WAS WORKING ON A TOWER ACTUALLY BROKE THEIR ARM WHILE THEY WERE UP IN THE AIR AND COULD NOT GET DOWN.
SO WE HAD TO BRING OUR BUCKET TRUCK AND BRING THE WORKER DOWN, AND BRING THE FIREFIGHTERS DOWN TO MAKE SURE THAT IT WAS VERY, VERY SAFE.
AND IT WAS A GREAT COLLABORATION WITH THE FIRE DEPARTMENT AND WE WERE HAPPY TO DO THAT.
I'M MOVING ON TO ANOTHER SECTION.
NOW WE'RE GOING TO TALK ABOUT ENERGY.
I GOT A COUPLE OF SLIDES HERE, AND I'M GOING TO TALK ABOUT WHAT POWER LOOKS LIKE ACROSS THE MARKET AND WHAT IT LOOKS LIKE FOR US.
IF YOU LOOK, IT HAS BEEN ESCALATING ENERGY DEMAND IN TEXAS.
AND THAT'S TIED TO THE INCREASE IN POPULATION.
THE GROWTH, PEOPLE MOVING TO TEXAS, IS ACTUALLY DRIVING MORE POWER, NOT -- IT'S A LOGICAL CONCLUSION, BUT IT IS DEFINITELY HAPPENING.
HERE'S KIND OF AN INTERESTING SLIDE, THOUGH.
WHAT HAPPENS IS, THE STATE DOES EVERYTHING IT CAN TO MAKE SURE THAT WE HAVE ENOUGH POWER TO SUPPLY ALL OF THE PEOPLE IN TEXAS FOR ALL THE NEEDS AT PEAK.
AND FOR US, THE BIGGEST PEAK WE HAVE IS DURING THE SUMMER.
IT CAN BE ANYWHERE FROM JULY TO AUGUST NORMALLY.
WHAT THIS SLIDE SHOWS IS THERE'S A DIFFERENCE -- IT SHOWS SEVERAL THINGS, BUT ONE THING IT SHOWS
[00:20:01]
IS THERE'S A DIFFERENCE IN THE TOTAL CAPACITY OF THE NAME PLATE AND HOW MUCH ENERGY YOU ACTUALLY GET.FOR THE MOST PART YOU CAN GET A GREAT DEAL OF IT, EVEN COASTAL WIND, IF IT'S RUNNING AND TYPICALLY COASTAL WIND IS RUNNING DURING THE HEAT OF THE DAY, YOU'RE GOING TO GET THAT POWER.
BUT WE HAVE A LOT OF OUR WIND BROADCAST ].
IT PRIMARILY BLOWS AT NIGHT BECAUSE OF THE WIND PATTERN.
EVEN THOUGH WE HAVE A LOT OF CAPACITY, IT'S NOT ALL AVAILABLE AT THE PEAK WHEN WE NEED IT.
SO WHAT THE STATE DOES, AND WHAT WE ALL DO AS OPERATORS IS WE ALSO MEASURE AT THE PEAK HOW MUCH EXCESS CAPACITY REALLY IS AVAILABLE ACROSS THE BOARD.
AND WE CALL THAT EXCESS RESERVE MARGIN.
AND IF YOU LOOK AT THE RED LINE, THE RED LINE SAYS THERE'S A THRESHOLD THAT THE STATE, PARTICULARLY ERCOT, THE OPERATOR, HAS BEEN ABLE TO DETERMINE IS A REALLY GOOD BUFFER OF SAFETY IN TERMS OF HAVING CAPACITY, IN CASE ANOTHER PLANT GOES DOWN OR THERE'S SOME ISSUE IN THE SYSTEM.
AND FOR THE MOST PART, YOU SEE A LOT OF CONSISTENCY ACROSS THAT LINE.
WE'VE BEEN AS HIGH AS 21.8%, IN 2010.
BUT THEN IF YOU LOOK AT THE OTHER END OF THE SPECTRUM, YOU'LL SEE THAT THIS IS PROBABLY OVER THE LAST, ALMOST DECADE, THE SUMMER THAT WE'RE EDGING UP ON IS -- WE'RE GOING TO HAVE THE LOWEST LEVEL OF RESERVE MARGIN.
WE HAVE IT, BUT IT IS THE LOWEST LEVEL THAT THE STATE HAS HAD OVER THIS PERIOD.
SO THERE HAVE BEEN A LOT OF CONVERSATIONS ABOUT HOW DO WE REALLY CONTINUE TO DO A LOT OF PREVENTIVE MAINTENANCE, GOOD COMMUNICATION, WORKING BETWEEN ALL OF THE SYSTEM OPERATORS, AND THE ERCOT AND PUC, BECAUSE WE NEED TO MAKE SURE THERE'S A LOT OF FOCUS OF REALLY PERFORMING WELL THIS SUMMER.
THE ONE THING THAT WE DO AS WELL, IF WE HAVE AN EXTRA-HOT, DRY SUMMER, THAT WILL PUT MORE PRESSURE ON THE SYSTEMS, IT'S MORE STRAIN ON THE SYSTEMS, AND MORE LIKELIHOOD THERE WILL BE OUTAGES.
THE HOTTER AND MORE INTENSE IT IS.
THE INTERESTING NEWS IS ALL THE FORECASTS THAT WE HAVE SAYS IT'S NOT GOING TO BE NABNORMALLY HOT.
THAT'S WHAT WE'RE HAVING RIGHT NOW.
THE RAIN THAT WE HAVE NOW ACTUALLY CREATES A PATTERN THAT ACTUALLY DOES START TO INDICATE THAT WE'LL MORE THAN LIKELY HAVE A MODERATELY HOT SUMMER, NOT AN EXTREMELY HOT SUMMER.
AGAIN, JUST SOMETHING AS KIND OF PROACTIVE INPUTS THAT WE LOOK AT SO WE CAN THINK HOW BEST TO MANAGE THE SYSTEMS. SO THEN HERE WE ARE, WE'RE TALKING ABOUT US.
WHILE THE STATE IS BELOW -- IS RIGHT AROUND 7% RESERVE MARGIN, YOU KNOW, WE, AND THE TARGET FOR THE GENERAL THRESHOLD IS ABOUT 13.75%, WE ACTUALLY HAVE A 19% RESERVE MARGIN, WHICH IS ONE OF THE HEALTHIEST IN THE SYSTEMS. AND POWER TYPICALLY HAS HISTORICALLY TRIED TO HAVE A HEALTHY LEVEL OF RESERVE MARGIN FOR THE SUMMER AND WE'RE STILL IN GOOD POSITION RIGHT NOW.
I'M NOT GOING TO GO OVER THIS SLIDE, BUT THIS ALSO GIVES YOU SOME CONSIDERATION, THOUGH, WE LOOK AT EVERYTHING WE CAN TO BE FOCUSED ON PREVENTION, TO MAKE SURE THE MAINTENANCE IS UP TO SPEED.
AND WHEN YOU GET TO THIS SLIDE, THIS IS AN EXAMPLE OF WORK ACTUALLY HAPPENING INTENSELY, BECAUSE WE REALLY MAKE SURE OUR PLANT MAINTENANCE IS UP EXTENSIVELY.
WHAT YOU SEE THERE IS -- ACTUALLY THE HEAD OF OUR GENERATING POWER UNITS, HE REPORTS TO CHRIS, AND HE'S MAKING SURE HE'S VISITING THESE LOCATIONS AND MAKING SURE WE'RE GETTING ALL THE MAINTENANCE DONE.
WE ARE OUT TALKING ABOUT -- ASKING PEOPLE IF THEY CAN USE THERMOSTATS, MAKE SURE THEY DON'T RUN THEIR AIR CONDITIONING HARD, ESPECIALLY AT PEAK, AND AT THEIR BIG INSTITUTIONS, ALL OF THOSE THINGS HELP US MANAGE MUCH BETTER THROUGH THE SUMMER.
THIS IS A THING THAT YOU MAY HAVE SEEN.
WE'RE SUPER EXCITED ABOUT PUTTING DISTRIBUTED SOLAR INTO OUR SYSTEMS, MEANING LOCALLY WITHIN WHERE WE LIVE.
IT'S ACTUALLY A HEALTHY PART OF ACTUALLY MANAGING DEMAND.
WE RECENTLY ANNOUNCED THAT WE HAVE A NEW 5 MEGAWATT COMMUNITY SOLAR PROJECT.
THE FIRST TIME WE DID IT, IT SOLD OUT VERY QUICKLY.
WHAT HAPPENS IS, WE PUT A FARM INSIDE THE CITY LIMITS, AND PEOPLE CAN GO BUY PANELS.
AND THOSE PANELS, THEY CAN GET THE CREDIT OF ENERGY OFF OF THOSE PANELS.
AND SO WE'RE EXCITED TO DO THIS.
WE EXPECT TO HAVE MORE COMMUNITY
[00:25:02]
SOLAR OUT THERE.THIS IS EVEN SPECIAL, TOO, BECAUSE IT ACTUALLY IS MORE OF A CARPORT COVER.
IT ACTUALLY SHADES THE CAR AND PROVIDES OFFSET IN POWER.
I JUST WANT TO GIVE YOU A LITTLE STATUS.
YOU KNOW WE HAVE A PROJECT WITH SOUTHWEST RESEARCH INSTITUTE.
WE'RE PUTTING IN ENERGY STORAGE UNITS AND A SOLAR SYSTEM.
IT'S EFFECTIVELY A VERY LARGE MICROGRID.
WE'VE GOT -- IT'S SHAPING UP VERY WELL.
ANYONE WHO WOULD LIKE A TOUR OF THAT LOCATION, WE'D BE GLAD TO ACCOMMODATE THAT.
I DID WANT TO GIVE YOU A STATUS, TOO, THAT WE CAME UP WITH THE ENERGY EFFICIENCY AND CONSERVATION PROGRAM CALLED SEP.
AND THAT WAS APPROVED BY THE COUNCIL AROUND THE 2008 TIME FRAME.
WHEN WE DID IT AGAIN, IT WAS PRIMARILY A LIGHT BULB PROGRAM.
IT TURNED INTO A WEATHERIZATION SUPPORT PROGRAM, A SOLAR REBATE PROGRAM, ALL TYPE OF PRODUCTS THAT WE CAN DO WHERE PEOPLE CAN HELP AND CONSERVE ENERGY.
WE HAD PROJECTED THAT THIS PROGRAM, IT WOULD TAKE US THROUGH THE END OF 2020 TO SAVE 771 MEGAWATTS AT A COST OF ABOUT $849 MILLION.
AND IT ALLOWED US TO DEFER OUR INVESTMENT IN INFRASTRUCTURE.
SO IF WE HAD NOT DONE THIS, WE WOULD HAVE BUILT ANOTHER PLANT, AND I OFTEN SAY IT PROBABLY WOULD HAVE BEEN A COAL PLANT.
BECAUSE THAT WAS THE PREVAILING TECHNOLOGY AT THE TIME.
AND SO IT HELPED US NOT DO THAT, IT HELPED US PAY ATTENTION TO THE EVOLUTION OF TECHNOLOGY.
AND IT ACTUALLY WAS THE -- THE PRECURSOR TO THE FLEXIBLE PATH, BECAUSE IT GAVE US A LOT OF FLEXIBILITY FOR THE FUTURE.
THE REALLY INTERESTING THING ABOUT IT IS, THE PROGRAM IS DOING VERY, VERY WELL.
WE BELIEVE THAT WE'RE GOING TO ACTUALLY MEET THE MEGAWATT TARGET THIS YEAR, AND THEN WE'RE GOING TO START A DISCUSSION ABOUT WHAT STEP 2.0 MIGHT LOOK LIKE, AND ASK FOR COMMUNITY INPUT ON THAT.
THESE ARE SOME OF THE BENEFITS THAT WE HAVE GOTTEN.
AGAIN, I WOULD HIGHLIGHT THE LAST ONE OVER THERE, 212 MEGAWATTS OF DEMAND RESPONSE.
AGAIN, THAT'S WHERE WE CAN CONTROL THE THERMOSTAT, WORKING WITH AN ENTITY, AND REDUCE THE DEMAND OF POWER.
THAT IS ONE OF THE BIGGEST PROGRAMS IN THE NATION.
SO AS WE LOOK FORWARD, TO THINK ABOUT ALL OF THOSE PROGRAMS, AGAIN, WE WANT TO KEEP THE ONES THAT ARE MOST EFFECTIVE, BUT WE WANT TO MAKE SPACE FOR NEW ONES.
WE WANT TO KNOW WHAT CUSTOMERS THINKS REALLY WORKS IN TERMS OF GIVING MORE INCENTIVES FOR THAT.
THE ONE THING I WILL SAY, AGAIN, THAT'S A COMMUNITY PROGRAM.
SO EVERYONE IN THE COMMUNITY PAYS INTO IT, AND THEN THOSE WHO ARE INTERESTED GO AFTER THE SPECIFIC BENEFITS OF DIFFERENT ASPECTS OF THE PROGRAM.
SO WE THINK IT'S REALLY GOOD TO HAVE A CONVERSATION ABOUT HOW WE PERFORMED.
WE'LL EXPLAIN THAT, THE PROGRAMS WE HAVE, AND THEN WE'LL TALK ABOUT WHAT DOES THE FUTURE LOOK LIKE.
LOTS OF SLIDES, LOTS OF STUFF.
I'M DONE, SO I AM READY TO TRY TO ANSWER YOUR QUESTIONS.
>> MAYOR NIRENBERG: VERY MUCH.
OUR PROPER PROTOCOL AND ROLL CALL.
I'LL FIRST ANNOUNCE WE'RE RECONVENED FROM EXECUTIVE SESSION.
THE CLERK IS GOING TO READ THE ROLL CALL NOW THAT WE HAVE A QUORUM.
>> MAYOR NIRENBERG: THANK YOU VERY MUCH.
THIS IS A LOT OF WORK THAT I'VE SEEN AT THE BOARD OF DIRECTORS MEETINGS.
SO I'LL MOVE TO COUNCIL COMMENT.
I'LL START WITH COUNCILMAN COURAGE.
I KNOW THAT YOUR PRESENTATION COVERED SOME OF THE HIGHLIGHTS OF WHAT YOU'VE BEEN DOING THIS YEAR, AND I WAS GLAD TO SEE KIND OF ANOTHER EXPLANATION OF WHERE WE ARE AND THE BASIS PRODUCING ENERGY, FOR EXAMPLE.
WE STILL HAVE A PRETTY SIGNIFICANT MARGIN OF ENERGY THAT WE CAN PRODUCE, WHEN NECESSARY, TO HELP MEET OUR NEEDS, OR STATE NEEDS IN THE SUMMERTIME.
EVEN THOUGH WE'VE CLOSED DOWN THE DEALY PLANTS.
I'VE ATTENDED SEVERAL OF YOUR MEETINGS, AS YOU KNOW, AND I RECALL THAT THE BUDGET MEETING THAT STICKS IN MY MIND WAS INDICATING THAT FOR THIS CURRENT FISCAL YEAR, I BELIEVE YOU WERE ANTICIPATING BEING IN THE BLACK BY ABOUT $2 MILLION.
WHICH IS A VERY THIN MARGIN, TO BE PROFITABLE, SO TO SPEAK, TO COVER ALL YOUR EXPENSES.
[00:30:01]
THAT CAME OUT, WHICH WAS A FEW MONTHS AGO, IF YOU FIND THAT CPS IS IN A BETTER FINANCIAL POSITION THAN WAS EXPECTED, OR ARE THERE DARK CLOUDS AHEAD? WHAT CAN YOU TELL US?MY TEAM IS LED BY MY SENIOR CHIEFS, WHO ACTUALLY MEET REGULARLY.
THEY'RE CONTINUING TO LOOK FOR OPPORTUNITIES.
EVERYTHING FROM MAINTENANCE TO RENEGOTIATING CONTRACTS.
AS A MATTER OF FACT, OUR BOARD REQUIRES THAT EVERY MONTH WE COME IN TO TELL THEM WHAT WE'RE DOING.
BUT AT A $2.6 BILLION COMPANY, AS WE'RE CHISELLING AWAY, IT'S NOT BIG DOLLARS.
HUNDREDS OF THOUSANDS OF DOLLARS.
THE BEST THING WE'VE DONE SINCE WE'VE HAD THE BUDGET APPROVED IS, WE RE-LOOKED AT OUR DEBT PLAN AND WE WERE ABLE TO CAPTURE SOME SAVINGS ON RESTRUCTURING SOME DEBT.
SO WE MOVED UP A BIT FROM 2 MILLION TO ABOUT $7 MILLION.
AND THEN WE HAVE QUITE A FEW THINGS IN THE PIPE THAT WE CONTINUE TO WORK ON.
I WOULDN'T TELL YOU THAT IT'S A BLEAK PICTURE, IT'S A TOUGH PICTURE.
WE'RE NOT READY TO DECLARE DEFEAT.
LAST YEAR, JUST AS AN EXAMPLE, LAST YEAR WE WERE CONCERNED ABOUT THE YEAR, AND WE THOUGHT THAT IT WAS GOING TO BE MAYBE IN THE 30 MILLION RANGE, WHICH IS VERY TIGHT FROM WHERE WE WERE BEFORE.
AND YOU ALWAYS HAVE RISK, BECAUSE SOMETIMES YOUR INVESTMENTS, YOU HAVE TO HOLD ON TO INVESTMENTS TO SUPPLY YOUR TRUSTS AND DIFFERENT THINGS.
SOMETIMES THOSE MARKETS GO AGAINST US AND SOMETIMES THEY GO WITH US.
LAST YEAR WE HAD A GREAT YEAR.
WE HAD OUR INVESTMENTS PERFORMED WELL.
WE DIDN'T HAVE ANY NEGATIVE IMPACT IN THAT.
SO THAT HELPED US A TREMENDOUS AMOUNT.
AND QUITE FRANKLY, EVERY PLANT PERFORMED WELL LAST YEAR, INCLUDING THE DEALY UNIT THAT WE RETIRED.
SO THE DIFFERENCE FOR THIS YEAR IS, THE MARKETS DON'T -- WE REALLY CAN'T TELL WHETHER OR NOT THE MARKET'S GOING TO GENERATE ANY BENEFIT FROM US.
WE STILL KIND OF HAVE THAT RISK.
WE DON'T HAVE THE DEALY UNITS, THE CAPACITY ISN'T THERE TO GENERATE THAT EXCESS POWER.
THAT'S WHY WE THINK THERE'S UPSIDE IN THE WHOLESALE BUSINESS AND WE'RE REALLY TRYING TO MONITOR IT.
WE'RE STILL NOT READY TO GIVE UP TO SEE IF THERE ARE SOME SAVINGS WE'RE MISSING, SOME EFFICIENCY, IN TERMS OF NEW TECHNOLOGY THAT WE MIGHT BE ABLE TO GET THE BENEFIT OF THIS YEAR.
BUT I'M GOING TO BE HONEST, INCREASINGLY, AFTER FIVE YEARS OF DOING ALL THOSE THINGS AND BRINGING BENEFITS AND BRINGING JOBS, ECONOMIC DEVELOPMENT, ALL THE STUFF WE'VE DONE, IT'S LOOKING MORE AND MORE LIKE MAYBE SOMETIME THIS YEAR I WILL BE COMING TO THE COMMUNITY AND TO YOU, IF WE JUST CAN'T MANIFEST THAT WITH A REQUEST FOR RATE INCREASE.
BUT WE'RE NOT READY TO DECLARE THAT.
AS SOON AS WE DO, I'LL BE HERE IMMEDIATELY WITH OUR BUSINESS CASE.
>> COURAGE: I THINK THAT'S WHAT I WAS GETTING TO, I THINK YOU KNEW THAT.
WE'VE BEEN FORTUNATE OVER THE LAST FOUR, FIVE, SIX YEARS THAT WE HAVEN'T HAD TO COME UP WITH A RATE INCREASE.
THAT'S CERTAINLY BEEN TO THE BENEFIT OF OUR CONSUMERS.
BUT ALSO, OF COURSE, HAVING THE ELECTRICITY AVAILABLE IS THE GREATEST BENEFIT TO THE CONSUMERS THAT WE CAN OFFER.
SO I APPRECIATE YOUR FRANKNESS ON THAT.
SOMETHING ELSE THAT CONCERNS ME IS THAT, YOU KNOW, WE'VE BEEN LOOKING AT A CLIMATE ADAPTATION AND ACTION PLAN.
AND A COMPONENT OF THAT HAS TO BE WHAT'S THE FUTURE PRODUCTION OF GREENHOUSE GASES THROUGH CPS ENERGY'S COAL PLANTS AND GAS PLANTS.
AND THERE'S BEEN A LOT OF CONCERN THAT PEOPLE PRESENTED TO ME THAT WE SHOULD BE CONSIDERING CLOSING THE COAL PLANTS, CLOSING THEM A LOT SOONER THAN THE FLEXIBLE PATH MAY HAVE LAID OUT.
I KNOW THAT WE'VE CLOSED THE DEALY POWER PLANTS AND THAT'S REDUCED SOME OF OUR CAPACITY, ESPECIALLY IN THE SUMMERTIME, TO MAYBE PRODUCE EXTRA ENERGY THAT CAN BRING IN SOME MORE MONEY.
WHAT IS THE EFFECTIVE LINE SPAN FOR THE TWO PLANTS THAT ARE CURRENTLY COAL-BURNING PLANTS RIGHT NOW?
>> THE ONE THAT'S PROBABLY CAUSING THE MOST CHALLENGE IS THE NEWEST ONE.
IT HASN'T BEEN OUT THERE, NINE YEARS THAT IT'S BEEN IN PLACE.
IT TECHNICALLY HAS THE CAPACITY TO RUN PAST 2040.
AND SO IT'S A PATH, AND NOT A PLAN, AND SO WE CONTINUE -- AND WE WILL CONTINUE TO LOOK AT TECHNOLOGY.
IF IT REALLY IS THE BEST ECONOMICS, AND WE HAVE THE PRICE OF GENERATION GO DOWN.
PEOPLE WILL SAY, WELL, THE PRICES ARE ALREADY DOWN.
WELL, THEY ARE, BUT IT'S ENERGY STORAGE IS WHAT WE'RE REALLY PAYING ATTENTION TO.
[00:35:01]
BECAUSE WE NEED THAT TYPE OF FIRMING CAPACITY, NON-EMITTING FIRMING CAPACITY TO MAKE SURE WE CAN GET THE MOST THAT WE CAN, TO QUADRUPLE DOWN ON RENEWABLES.IF THAT DOES SHOW UP, THEN WE HAVE A DIFFERENT TRAJECTORY ON THIS ONE.
THE SPRUCE 1 PLANT IS IN THE -- REACHING 2030, I BELIEVE, TIME FRAME.
WE HAVE BEEN ASKED AGAIN, CAN YOU DO IT SOONER.
THAT'S FROM A REGULATORY STANDPOINT, HOW LONG IT CAN LAST.
SO WE DO HEAR AND ACCEPT THE CHALLENGE OF, IS THERE ANY WAY TO GET THERE, AND WE THINK THAT EVERY YEAR WE'RE GOING TO LOOK AT IT AND SEE HOW WE CAN MOVE IT.
THAT'S WHAT THE FLEXIBLE PATH IS ABOUT.
BUT IT'S NOT ABOUT DECLARING THAT WE MAKE THE CHANGE WITHOUT KNOWING THAT WE HAVE A WAY TO MOVE THERE WITH RELIABILITY, AND WITH AFFORDABILITY, BALANCED TO THE ENVIRONMENTAL NEEDS THAT WE NEED TO GO THROUGH, THE SECURITY NEEDS THAT WE NEED TO MANAGE.
SO FOR US, WE'RE MANAGING THE WHOLE THING, AND WE UNDERSTAND THAT THERE IS INCREASED INTEREST, AND WE'LL DO ALL WE CAN TO GET THERE.
>> COURAGE: I KNOW WE HAVE GAS-FIRED PLANTS.
AND ARE WE LOOKING AT ACQUIRING ANY OF THOSE TO MAYBE MAKE IT EASIER TO REPLACE COAL PLANTS QUICKER?
>> WE CONTINUALLY LOOK AND SCAN TO SEE IF THERE ARE ANY GAS-GENERATING UNITS.
IN ONE SENSE, PEOPLE HAVE SAID, DON'T DO GAS EVEN, BECAUSE IT HAS EMISSIONS.
BUT IT HAS HALF THE AMOUNT OF EMISSIONS THAT COAL DOES.
AND IT CAN OPERATE VERY WELL, AND IT CAN BE A GREAT TRANSITION TECHNOLOGY, AGAIN, AS WE ULTIMATELY GET TO NON-EMITTING.
IF WE SEE A GOOD OPPORTUNITY TO ACTUALLY BUY A PLANT -- BECAUSE IF WE CAN BUY A PLANT, THEN WE CAN CONTROL THE USAGE.
NOW, IN THE INTERIM, WE DON'T NEED TO BUY A PLANT.
WE CAN GO OUT AND GET CAPACITY.
THERE IS CAPACITY, WE'RE LOOKING AT THE ABILITY TO FIRM UP AND INCREASE OUR RESERVES WITH SOME EXISTING CAPACITY IN THE MARKET.
AND WE THINK THAT THAT IS A LOWER RISK OPTION, BECAUSE WE'RE NOT PUTTING STEEL IN THE GROUND IN THAT CASE, JUST UTILIZING THE ASSETS AVAILABLE IN THE MARKET.
>> COURAGE: YOU'VE JUST MENTIONED WE'VE ADDED 5 MEGAWATTS OF POWER IN SOLAR.
>> COURAGE: IT WILL BE IN THE AREA OF COVERED PARKING AND THINGS OF THAT NATURE.
ARE THERE OTHERS ON THE DRAWING BOARD THAT YOU WANT TO BRING ONBOARD?
>> COURAGE: WHAT MEGAWATTAGE MIGHT BE OVER THE NEXT YEAR OR TWO OR THREE?
DISTRIBUTED SOLAR USUALLY IS MORE CHUNKY AND SMALLER, BECAUSE YOU'RE PUTTING THEM ON HOMES.
EVEN LARGE BUSINESSES, IT'S NOT A TREMENDOUS AMOUNT.
ON THE UTILITY SCALE SIDE, WE ARE LOOKING FOR OPPORTUNITIES TO DO THOSE.
I MEAN, I WOULD IMAGINE THAT THERE WILL BE -- WE'LL ULTIMATELY TRY TO BUILD THOSE IN 100-MEGAWATT CHUNKS AND ABOVE AS QUICKLY AS WE CAN.
AGAIN, THOUGH, WE'RE GOING TO NEED TO BRING IN FIRMING CAPACITY.
WE'LL TRY TO BRING IN ENERGY STORAGE, AND FIRM IT UP IN SOME WAY ALSO WITH PROBABLY SOME EXISTING GAS UNITS.
SO THE MORE WE DO THAT, WE WILL COME FORWARD AND KIND OF TELL YOU HOW WE'RE THINKING.
WE'RE KIND OF THINKING MORE IN A BUNDLING PERSPECTIVE, TO KEEP RENEWABLES FLOWING, BUT MAKE SURE THAT IT HAS THE RIGHT LEVEL OF FIRMING CAPACITY.
>> MAYOR NIRENBERG: THANK YOU, COUNCILMAN.
>> PERRY: LET ME GO BACK A LITTLE BIT ON THE NEW FACILITY THAT'S BEING CONSTRUCTED.
WHAT WAS THE ORIGINAL COST ON THAT?
>> THE BUDGET ON THAT IS $210 MILLION.
>> PERRY: ARE WE STILL AT 210?
>> PERRY: YOUR SURPLUS PROPERTIES?
>> NOT SURE EXACTLY, BUT WE THINK THAT THEY MAY BRING IN ANYWHERE FROM 50 TO $90 MILLION.
AND YOUR PLAN IS TO BUY DOWN THAT DEBT ON THE NEW BUILDING?
>> WE PLAN TO NOT PUT ANY DEBT ON THAT BUILDING.
AND TO MANAGE THIS THROUGH THE CASH FLOW THAT WE GET FROM THE BUILDINGS, AND OUR EXISTING CASH FLOW, BECAUSE WE DO NOT WANT TO PUT DOWN THAT BUILDING.
YEAH, IF YOU CAN KIND OF KEEP US UPDATED ON WHERE THE -- WHERE YOU ARE IN THE SALES.
YOU PIQUED MY INTEREST, COUNCILMAN COURAGE TOUCHED ON IT, YOU TALKED ABOUT A RATE INCREASE.
WE HAVE BEEN VERY FORTUNATE HERE OVER THE YEARS ABOUT NOT HAVING A RATE INCREASE, AND I DON'T KNOW THAT PEOPLE ARE EXPECTING ONE.
BUT IF THERE'S ANYTHING OUT ON THE HORIZON ABOUT A RATE
[00:40:02]
INCREASE, OR YOU'RE THINKING ABOUT ONE, WE NEED TO START GETTING THAT OUT INTO THE PUBLIC ARENA NOW, INSTEAD OF WAITING UNTIL, OKAY, IT'S COMING TO COUNCIL FOR A RATE INCREASE.WE'RE GOING TO HAVE TO REALLY ADVERTISE AS TO WHY.
AND WHEN I LOOK AT THIS, I HOPE THAT IT'S NOT GOING TO BE TIED TO THE CAP.
>> PERRY: BECAUSE, YOU KNOW, THERE'S A LOT OF CONSTERNATION ABOUT THE CAP RIGHT NOW.
RESIDENTS AS WELL AS INDUSTRY, ABOUT THE COST OF THE CAP, AND WHAT IT'S GOING TO DO TO INDIVIDUALS' POCKETBOOKS HERE IN TOWN, ALONG WITH BUSINESSES THAT MAY LEAVE.
AND WHAT IT'S GOING TO DO TO CPS.
AND THE THINGS THAT IT'S GOING TO BE FORCING IN THE FUTURE.
SO I'M CERTAINLY GOING TO BE VERY INTERESTED IN THAT, ALONG WITH RENEWABLES.
YOU KNOW, RENEWABLES DOES NOT GIVE YOU THE RETURN ON INVESTMENT AS OUR CURRENT PLANTS.
SO IF THERE'S ANY RATE INCREASE COMING UP HERE IN THE FUTURE, IT'S GOING TO HAVE TO BE VERY CLEAR WHAT'S DRIVING THAT RATE INCREASE.
BECAUSE THERE IS -- THERE ARE COSTS ASSOCIATED WITH A CAP.
AND THERE'S GOING TO BE COST IMPLICATIONS FOR CPS.
SO I HOPE THAT WHATEVER IT IS OUT THERE IN THE FUTURE, IT'S GOING TO BE VERY CLEAR AND DELINEATED AS TO, OKAY, THIS IS WHY THIS COST IS GROWING.
AND HERE'S THE COST THAT'S BEING ATTRIBUTED TO THE CAP.
>> PERRY: ALL RIGHT? HAVE Y'ALL THOUGHT ANY MORE ABOUT NUCLEAR POWER?
WE'VE LOOKED AT IT IN MANY WAYS.
THE CURRENT TECHNOLOGY THAT IS AVAILABLE, THE CHALLENGE IS, IT'S NOT COMPETITIVE WITH GAS.
SO GAS IS BEATING IT IN TERMS OF THE INVESTMENT REQUIREMENT.
IT'S LIKE MULTIPLE FOLDS OF A GAS INVESTMENT.
WE'RE NOT SEEING THAT'S A GOOD OPPORTUNITY FOR US, NUCLEAR CURRENTLY.
WE'RE ACTUALLY NOT SEEING THAT IT'S REALLY BEING PROMOTED NATIONALLY.
THERE'S ONLY ONE, I THINK, ACTIVE NUCLEAR PROJECT.
A LOT OF THE OTHER ONES HAVE STRUGGLED EITHER BECAUSE OF PARTNERSHIP ISSUES, OR JUST OTHER COST ISSUES.
IT DOES HAVE A TENDENCY TO END UP BEING A FAIRLY EXPENSIVE INVESTMENT.
NOW, AFTER YOU GET IT IN, THAT ASSET CAN LAST YOU A TREMENDOUSLY LONG TIME.
SO THE ISSUE IS WHETHER OR NOT IT'S THE BEST INVESTMENT FOR A COMMUNITY RIGHT NOW.
BUT BECAUSE GAS ITSELF IS JUST SO RELIABLE AND SO AFFORDABLE, IT TENDS TO BEAT OUT NUCLEAR EVERY TIME RIGHT NOW.
THAT'S WHAT I WANTED TO HEAR IS THAT, OKAY, WE'VE LOOKED AT IT, THE RETURN ON INVESTMENT ISN'T AS GOOD AS GAS.
AGAIN, I THINK WE NEED TO LOOK ON THAT RETURN INVESTMENT, RETURN ON INVESTMENT ON ANY PARTICULAR OPTION OUT THERE.
WHETHER IT'S RENEWABLES, GAS, C COAL.
YOU KNOW, WE'VE GOT THE COAL PLANTS, THAT'S PART OF OUR PRODUCTION RIGHT NOW.
SO LET'S DON'T ALWAYS DISCOUNT COAL JUST BECAUSE OF THE CLEAN AIR AND CLIMATE.
AND YES, WE CAN WORK TOWARDS MOVING AWAY FROM THAT, BUT THERE'S A COST ASSOCIATED WITH THAT.
AND I DON'T WANT TO LOSE SIGHT OF THAT, AND MAKING SURE THAT PEOPLE UNDERSTAND, OKAY, THIS IS WHAT IT'S GOING TO COST US TO DO THAT.
>> MAYOR NIRENBERG: COUNCILWOMAN SANDOVAL?
>> SANDOVAL: THANK YOU, MAYOR PRO TEM.
THANK YOU FOR YOUR PRESENTATION.
FIRST I'M GOING TO JUST ADD ON, I THINK WE ALSO NEED TO CONSIDER THE OTHER COSTS OF USING COAL, WHICH IS THE HEALTH IMPACTS.
IT'S ONE OF OUR DIRTIEST FUELS.
I WOULD BE REMISS IF I DIDN'T BRING THAT UP, THAT THAT SHOULD BE PART OF THE WHOLE EQUATION.
SO THANK YOU FOR THE PRESENTATION, AND FOR ALL THE OUTREACH YOU'VE DONE IN THE SESSIONS THAT YOU'VE HELD AND BRINGING YOUR BOARD MEMBERS THERE.
I THINK THAT SHOWS A REAL WILLINGNESS ON THE BEHALF OF THE STAFF TO CONNECT THE BOARD MEMBERS TO THE COMMUNITY, AND TO BE FAITHFUL TO THE REQUESTS FROM THE COMMUNITY AS A PUBLICLY OWNED UTILITY.
YOU AND I HAD A PRESS CONFERENCE FOR THE SMART SNIFFER LAST YEAR.
[00:45:04]
SMART SNIFFER NOW.I THINK THE FIRST TIME WE GOT IT, IT WAS NEW TECHNOLOGY AND WE WERE TRYING TO GET OUR OPERATIONAL PRO ES SESS DOWN WITH THE SMART SNIFFER.
NOW WE'RE ACTUALLY REDOING OUR WHOLE VIEW OF COMPLIANCE AND FOCUS ON ENTERPRISE COMPLIANCE OVERALL.
AND WE'RE TRYING TO FIGURE OUT A FORMALIZED PLAN SO THAT THE SMART SNIFFER IS CONTINUING TO BE DEPLOYED.
AND WHAT ADDITIONAL INVESTMENTS DO WE NEED, TWO SMART SNIFFERS, WHAT OTHER TYPE OF TECHNOLOGY WE CAN INCORPORATE TO HELP US IMPROVE THE SYSTEMS THAT WE HAVE.
SO WE'RE LOOKING AT ALL OF THAT.
>> SANDOVAL: SO WHEN WILL WE SEE -- I GUESS HAVE THERE BEEN ANY RESULTS FROM THE USE OF THE SNIFFER? LIKE ANY LEAKS THAT WERE FIXED AND IDENTIFIED?
ACTUALLY, WHAT'S INTERESTING ABOUT THE SMART SNIFFER, IT HAS A HIGH DEGREE OF ACCURACY TO PINPOINT A LEAK.
AND WHAT WE HAVE SEEN, EVEN IN SOME OF THE CONSTRUCTION PROJECTS THAT WE HAVE, RECONSTRUCTION WHERE WE'RE GOING TO REPLACE PARTS OF OUR LINES, WE CAN TELL EXACTLY WHERE TO GO TO THAT BASED UPON THE SMART SNIFFER.
SO IT'S ACTUALLY SAVED US TIME AND MONEY IN SOME OF THE PROJECTS WE'VE BEEN ABLE TO DO BEFORE.
AND IF THERE IS A LEAK, IT ALSO HELPS US VERY QUICKLY SWEEP THE AREA, TO DETERMINE HOW BIG THAT LEAK MIGHT HAVE BEEN, AND ARE THERE ANY LEAKS IN THE AREA.
YES, WE'RE SEEING DIRECT RESULTS FROM THAT.
I ALSO WANTED TO THANK YOU AND YOUR BOARD FOR DISCUSSING THE ITEM OF THE CITIZENS ADVISORY COMMITTEE.
I THINK MAYBE COUNCILMAN COURAGE AND I HAD BROUGHT IT UP PREVIOUSLY ABOUT BEING ABLE TO PUBLISH THEIR AGENDAS ONLINE.
I THINK THAT'S GOING TO BE HELPFUL TO MY COMMUNITY, SO I'LL PROBABLY PROMOTE THAT IN MY NEWSLETTER AS WELL.
I UNDERSTAND THAT THEY'RE NOT ENTIRELY COMFORTABLE OPENING THEIR MEETINGS UP TO THE PUBLIC AT THIS POINT.
>> SANDOVAL: YEAH, THAT CAN ALWAYS BE REVISITED.
BUT UNDERSTOOD FOR THE MOMENT.
BUT THANK YOU FOR PUTTING THAT ON THE AGENDA.
ONE OF THE OTHER THINGS THAT YOUR LAST BOARD I WAS READING ABOUT IS SOME CONCERNS ABOUT THE STEP PROGRAM FROM ONE OF YOUR BOARD MEMBERS.
IS POLICY GOING TO CHANGE ON THAT? OR WHAT'S THE DIRECTION ON THE STEP PROGRAM?
>> WELL, YES, THERE WAS A LIVELY DISCUSSION ABOUT THAT.
BUT THE COMMENT ABOUT THE STEP PROGRAM IS THAT, WHEN YOU'RE RUNNING A UTILITY, OR IN THE BUSINESS ENVIRONMENT, IT IS VERY DIFFICULT TO TELL SOMEBODY THAT YOU'RE GOING TO PAY THEM NOT TO USE YOUR PRODUCT.
IT'S HARD TO SAY I'M GOING TO -- THAT'S NOT WHAT THE STEP PROGRAM DOES, IT DOESN'T PUT YOU OUT OF BUSINESS, BUT YOU'RE BASICALLY PAYING PEOPLE TO USE LESS OF IT.
SO WE HAD A BOARD MEMBER THAT WAS EXPRESSING, THAT'S CONTRARY TO TRYING TO DRIVE YOUR BUSINESS, IN ITS EXISTING STATE.
HE WAS JUST BASICALLY INDICATING THAT, IS THAT THE RIGHT THING FOR US TO BE DOING.
I THINK IT'S GREAT TO HAVE A BOARD MEMBER THAT SAYS, LET'S HAVE A CONVERSATION ABOUT THAT.
IN THAT SAME CONVERSATION, WE TALKED ABOUT, WHILE THERE IS EXTREME VALUE STILL IN THE STEP PROGRAM, BECAUSE, YES, WE ARE PAYING PEOPLE -- JUST FOR CLARITY, EVERYBODY PAYS ABOUT $5 A MONTH FOR THAT PROGRAM.
AND I ALWAYS SAY, IT'S NOT POPULAR, EVERYTHING COSTS MONEY.
RENEWABLES COST MONEY, GAS COSTS MONEY, THERE ARE SOCIAL ISSUES, THERE ARE DISPOSABLE ISSUES.
EVEN THE PANELS, DISPOSING OF PANELS IN THE LONG RUN IS GOING TO BE AN ISSUE FOR THE COUNTRY.
NOT THE ONE THAT WE CAN'T RESOLVE, BUT EVERYTHING IN THE PRO AND CON THAT YOU HAVE TO DO.
AND THE PROGRAM ITSELF, EVERYBODY IN THE COMMUNITY PAYS FOR THAT.
BUT IN WORKING WITH THE COUNCIL, THAT WAS A GOOD INVESTMENT, BECAUSE WHAT IT DOES IS IT CREATES A PATHWAY TO ACTUALLY THINK ABOUT NEW TECHNOLOGIES, AND MANAGING HOW MUCH ENERGYNE PEOPLE USE.
AT ONE POINT IN TIME BEFORE WE DID THE STEP, I WOULD SAY MOST PEOPLE CUT OUT THEIR LIGHTS AND NOT THINK ABOUT BROADCAST ].
DISCUSSION ABOUT CONSERVATION.
IF WE DON'T MANAGE IT, THAT MEANS WE'LL PUT MORE IRON IN THE GROUND NO MATTER WHAT IT IS.
SOLAR SYSTEMS ARE IRON, COAL PLANTS -- WE WON'T SEE ANY MORE COAL, BUT GAS PLANTS, THAT'S IRON IN THE GROUND.
SO IF WE CAN BE SMART ABOUT IT AND USE TIME TO FIGURE OUT
[00:50:02]
WHAT'S THE NEXT BEST STEP, WHILE TECHNOLOGY IS GETTING BETTER, OVERALL IT IS GOOD FOR US.AS THE CEO OF THE COMPANY, I STAND BEHIND THE STEP PROGRAM.
BECAUSE AGAIN, WE WOULD HATCH MADE AN INVESTMENT IN A TECHNOLOGY THAT IS STRUGGLING RIGHT NOW.
AND NOW WE CAN LOOK AT OTHER TECHNOLOGIES -- I MEAN, GAS WAS MORE EXPENSIVE IN 2008 THAN BUILDING A NUCLEAR UNIT.
AND SO YOU GET THAT ADVANTAGE OF TIME AND PROGRESS, AND THE STEP HELPS YOU CHANGE BEHAVIOR.
IT HELPS YOU THINK ABOUT MAKING YOUR INVESTMENTS SMART.
AND SO WHILE IT -- IN THE FOREFRONT SAYS YOU'RE PAYING PEOPLE TO USE LESS OF YOUR PRODUCT, IT'S HELPING YOU MAKE A TRANSITION TO THE FUTURE IN THE RIGHT WAY.
THAT'S THE REAL CONTEXT OF WHAT THE CONVERSATION WAS, AND KIND OF ENDED ON THAT.
>> SANDOVAL: I'M JUST GLAD TO HEAR YOU SAY THAT YOU STILL STAND BEHIND IT.
I THINK IT MAKES COMPLETE SENSE, IT BUYS US TIME TO WAIT UNTIL BETTER TECHNOLOGY COMES OUT BEFORE COMMITTING OURSELVES TO SOMETHING THAT MAY BE PASSING RIGHT NOW.
IT'S ALSO LIKE, I DON'T KNOW, ALMOST LIKE PAYING SOMEONE WHO USES OUR AMBULANCES VERY FREQUENTLY, TO TAKE CARE OF THEMSELVES.
SO IN TERMS OF THE NEXT ITERATION, OR USING THE STEP PROGRAM, HOW CAN WE HELP IN GETTING MAYBE THE BIG ENERGY USERS TO SIGN UP FOR THE STEP PROGRAM? OR IS IT JUST WHOEVER APPLIES?
>> WE ACTUALLY CONTINUE EVERY YEAR TO GO OUT TO BUSINESSES THAT ARE NOT IN THE PROGRAM AND ASK THEM TO COME IN.
AND ACTUALLY, WE DID A REFRESH AGAIN THIS YEAR.
BUT IF YOU HAVE SOMEONE THAT YOU THINK WE SHOULD BE TALKING TO, LET US KNOW AND WE'LL GO OUT, AND WE EXPLAIN EVERYTHING.
YOU KNOW, EVEN THE UNIVERSITIES --
>> SANDOVAL: I HAVEN'T SEEN THEIR ENERGY BILLS.
>> WE CAN'T PUBLISH THEIR ENERGY BILLS, BECAUSE THAT'S PRIVATE DATA INFORMATION.
BUT IF YOU KNOW THERE'S A LARGE ENTITY, WE'LL DO THAT WORK FOR YOU.
>> SANDOVAL: BUT YOU CAN DO THE MARKETING BASED ON WHAT YOU KNOW ON YOUR END IN TERMS OF ENERGY USE EASIER THAN --
AND THEN I DO HAVE A QUESTION ABOUT THE EXCESS CAPACITY.
AND THIS MAY REQUIRE A FOLLOW-UP CONVERSATION.
SO YOU CLOSED DEALY, AND I BELIEVE THAT WAS PART OF YOUR EXCESS CAPACITY.
BUT SOMEHOW WE STILL HAVE A 19% EXCESS CAPACITY FOR PEAK DAYS.
WAY ABOVE -- WE WERE WAY ABOVE 20%.
AT ONE TIME IN OUR HISTORY, AND I CAN GET YOU THAT SLIDE, WE WERE OVER 30%.
SO REMIND ME, I REMEMBER YOU SAYING THAT DEALY WAS USED KIND OF AS A PEAKER, YOU ONLY -- IT WAS LIKE ON SOME IDLE MODE AND THEN YOU WOULD FIRE IT UP IF YOU NEEDED MORE.
CAN YOU TELL ME A LITTLE BIT MORE ABOUT HOW THAT WORKS WITH THIS EXCESS CAPACITY.
IS IT ALWAYS GOING? AND WHAT I'M GETTING AT, PAULA, IS WE'RE IN NON-ATTAINMENT RIGHT NOW, AND I BELIEVE THESE ARE THE HIGHEST EMITTERS OF NOX.
I'D LIKE TO EXPLORE WHAT FLEXIBILITY WE HAVE.
IF OUR EXCESS CAPACITY IS REALLY THAT MUCH, IS IT POSSIBLE TO SORT OF TURN DOWN THE VOLUME JUST A LITTLE BIT ON A DAY THAT'S ANTICIPATED TO BE AN OZONE DAY? WE'RE EXPECTING THOSE TO COME BACK.
WE'RE IN OZONE SEASON RIGHT NOW, BUT WE PROBABLY WON'T SEE OTHER PEAKS IN OZONE UNTIL SEPTEMBER.
FOR SOME REASON WE SPLIT IT OVER TWO PARTS OF THE SUMMER.
THAT'S WHAT I'M INTERESTED IN EXPLORING WITH YOU AND YOUR TEAM.
I DON'T KNOW IF THAT'S BEEN EXPLORED BY GETTING TO 70 GROUP.
>> SO WE CAN TALK A LITTLE BIT ABOUT IT, AND THEN WE CAN COME BY AND SPEND SOME MORE TIME WITH YOU.
SO I THINK PART OF YOUR REFERENCE, WE TALKED ABOUT SOMETIMES WHEN THEIR BASE LOAD UNIT, LIKE A COAL UNIT, YOU DON'T MODULATE THAT LIKE A LIGHT SWITCH.
YOU JUST DON'T CUT IT ON AND CUT IT OFF, BECAUSE YOU CREATE MORE AND WEAR AND TEAR ON THE UNIT.
THERE ARE CERTAIN POINTS IN TIME WHERE WE WOULD DIAL THE CAPACITY BACK WITHOUT CUTTING IT OFF.
SO THAT THE NEXT MORNING, WHEN POWER STARTED TO COME BACK FAST, WE COULD RAMP THE UNIT BACK UP AGAIN.
SO TO YOUR POINT, WE WOULD REDUCE IT.
WE'D ALSO REDUCE THE CAPACITY OF COAL, BECAUSE AT NIGHT, MORE WIND COMES THROUGH, AND YOU DON'T NEED IT.
AND IT'S A PRETTY GOOD FLOW OF WIND AT NIGHT.
SO THAT'S PROBABLY THE MODULATION THAT WE'VE REALLY BEEN TALKING ABOUT.
WHEN THE PEAK HAPPENS AND THE SUMMER HAPPENS, WE'RE RUNNING
[00:55:02]
THOSE THINGS PRETTY FULL, BECAUSE THEY'RE NEEDED HERE OR THEY'RE NEEDED BY ERCOT.AND THAT EXCESS CAPACITY IN THE COMMERCIAL MARKETS THAT WE HAVE, WE'RE RUNNING IT FOR ERCOT, BECAUSE IF WE SAID WE'RE NOT GOING TO RUN IT BECAUSE OF EMISSION CHALLENGES, THEN WE'LL CAUSE INSTABILITY IN ERCOT, BECAUSE THAT -- WE NEED THE WHOLE SYSTEM TO BE AVAILABLE.
WE BENEFIT BECAUSE WHEN WE SELL THAT CAPACITY, WE MAKE MONEY, AND THAT HELPS US KEEP RATES LOW IN SAN ANTONIO.
NOW, WE THINK CONSCIENTIOUSLY, IS THERE ANY TIME THAT WE CAN KEEP THE CAPACITY OF A UNIT DOWN, TAKE IT OFFLINE, LIKE A DEALY UNIT.
WHEN THE DEALY UNITS ARE COMING OFF, IT'S SIGNIFICANTLY REDUCING ALL -- YOU KNOW, EMISSIONS ARE GONE, IT'S BENEFICIAL TO THE OZONE.
WE'RE SEEING BENEFITS FOR THIS YEAR BECAUSE THOSE UNITS ARE DOWN.
BUT RELATIVE TO THEM BEING USED, WE THINK ABOUT IT, WE MANAGE IT, WE CAN COME BY AND TELL YOU A LITTLE BIT MORE ABOUT HOW WE TRY TO CONTROL IT AND CONSIDER THE ENVIRONMENTAL IMPACTS AS WE GO THROUGH THE SUMMER.
>> SANDOVAL: AND I REALIZE THAT WE HAVE THE ABILITY TO SELL THAT, AND THAT'S HELPFUL TO CPS AND THE COMMUNITY.
I DIDN'T REALIZE IT WAS DIRECTLY TIED TO THE RATES.
>> SANDOVAL: SO EVERY TIME WE OF REBATE.AWATT, I GET SOME SOR-
>> YOU DON'T GET A RATE INCREASE FOR THAT YEAR.
SO WE PRODUCE, LIKE $70 MILLION EXTRA FROM THE DEALY UNITS.
THAT MEANS WE DIDN'T HAVE TO COME IN AND ASK FOR A RATE -- WE USE IT LIKE THE STEP PROGRAM AND DEFER THE NEED FOR A BASE RATE INCREASE BECAUSE WE'RE OPTIMIZING THAT EXCESS CAPACITY IN A WAY THAT'S BENEFICIAL TO CUSTOMERS.
>> SANDOVAL: SO NOT IMMEDIATE, BUT IN THE COMING YEARS.
AND SO THERE'S A RATE INCREASE AND THEN THERE'S THE SELLING IT ON THE MARKET.
I JUST THINK IT'S WORTH DOING A COST BENEFIT ANALYSIS FOR THIS, BECAUSE SEEING HOW MANY TIMES OUR REDUCIBLE, IF WE WERE TO DIAL IT BACK, AND I UNDERSTAND ABOUT THE INSTABILITY IN THE ERC ARE OT MARKET, BUT IF WE WERE ABLE TO TELL THEM -- I DON'T KNOW, I THINK WE SHOULD JUST EXPLORE IT.
WE'LL COME BY AND TALK TO YOU AND TELL YOU HOW WE DO IT.
THE ULTIMATE THING IS OVER TIME, WE'LL BE ABLE TO CHANGE THIS PORTFOLIO.
AND IT WILL CHANGE THE WHOLE PROFILE AND DYNAMICS.
HOW WE MANAGE WHAT WE HAVE NOW, AND HOW WE'RE LOOKING AT THE FUTURE.
WE'RE JUST IN NON-ATTAINMENT REVIEW FOR THE NEXT TWO YEARS, AND THOSE TWO YEARS ARE ABSOLUTELY CRITICAL FOR US SO WE DON'T GO INTO THE NEXT LEVEL OF NON-ATTAINMENT, WHICH WOULD BE EXTREMELY MORE COSTLY FOR THE CITY.
SO I JUST -- I THINK WE HAVE TO CONSIDER THAT, IF IT'S POSSIBLE.
BUT IF WE TAKE THAT CAPACITY OFFLINE, IT MAKES THE RATE INCREASE BIGGER.
WE HAVE TIMING ISSUES BOTH WAYS.
SO WE WILL SHOW YOU MORE OF THE WHOLE COUNCIL ABOUT THE IMPLICATIONS.
WE CAN MAKE AN INCREASE LIKE THIS, OR WE CAN MAKE ANOTHER INCREASE AND MODULATE.
>> SANDOVAL: THAT'S WHAT I'M ASKING FOR.
I'M NOT ASKING YOU TO SAY YES RIGHT NOW.
>> SANDOVAL: I'M JUST SAYING THE THREAT OF THE NEXT LEVEL OF NON-ATTAINMENT IS SO GREAT, THAT IT'S WORTH AT LEAST KNOWING WHAT THESE NUMBERS LOOK LIKE, AND THE FACT THAT THIS IS OUR LARGEST POINT SOURCE FOR NOX, WHICH IS OUR BIGGEST DRIVER FOR OZONE.
WE WOULD BE REMISS IF WE DID NOT --
>> I'LL BE GLAD TO TELL YOU HOW THAT LOOKS.
THAT CONCLUDES OUR SPEAKERS, AND QUESTIONS.
>> THANK YOU FOR
* This transcript was compiled from uncorrected Closed Captioning.