Commission meeting 8-10-2021: A moment of silence to remember Commissioner Dale Walker
Commissioners remembered with kind words and a moment of silence, Commissioner Dale Walker, 75, who died Sunday from complications with lung cancer. He joined the commission in 2011.
"We'd like to recognize Dale for his leadership," said Commission President Larry Schaapman. He was an advocate for low-cost public power. He had a tenacity for the economics of this utility. He was passionate about fiber and the residents of this country are becoming the big recipients of that push that he had for bringing fiber. His supportiveness with staff, his soft spokenness, his smile and the twinkle that was in his eye will be greatly missed. Our hearts go out to his wife Cheryl and their family. We have all benefited from his service and it's our honor to have been able to serve with him."
Commissioner Nelson Cox added, "I've known him most of my life and I've really appreciated him the last three years. His experience and his mentoring. I could call him any time. He was always there for you. He's done a lot of our communities, our county. He was a great guy and he'll be sorely missed."
Commissioner Tom Flint also went "way back" with Walker. "One thing I like about Dale, he always had a smile and he always thought through things very well, very thorough. At the end of the day, we'd maybe agree to disagree on things but we both went forward from that. Big shoes there to fill, for sure."
Commissioner Judy Wilson remembered Walker as helpful both during her campaign and after election to the board. "He was very informative and willing to answer anything I wanted to know about. He was always a positive influence and encouragement for me to run for the board, which I'm very glad I did. And when I was elected to the board, I felt like I could ask Dale anything. He was always helpful and willing to share. And I certainly appreciated his positive influences. He's going to be missed."
General Manager and CEO Kevin Nordt called Commissioner Walker "A tremendous person, a tremendous friend and a tremendous pillar of the PUD. We all miss Dale and have benefited from knowing and working with him."
Updating aged infrastructure with field work, outreach, planning and technology
Grant PUD's Construction and Maintenance group is working to support a 10-year plan to reduce outage time and increase system reliability by identifying and replacing aged infrastructure before it fails.
"These are huge projects. This is game-changing for the PUD," Ron Alexander, senior manager of Power Delivery Construction and Maintenance, told commissioners
The Power Quality group is communicating with irrigators to improve the quality of electric service and stability of voltage needed to keep water flowing during growing season. They're reaching out in person and by letter, urging irrigators to keep Grant PUD informed of pump upgrades that could strain the electric system and reminding them to take extra care to ensure their irrigation equipment and water streams don't hit power poles and lines.
An electronic monitoring software system is now in place for outage-prone feeders that serve Wahluke-area irrigators and other customers. The software sends alerts when power usage on a feeder increases beyond it's designed specifications to give crews time to analyze and upgrade the feeders before damage can occur.
A new Asset Management data base, already well underway and to be completed in about two years, will record and track all transmission and distribution system equipment for both the power and fiber systems. This tool will ensure timely maintenance happens according to written standards and regulations. It will track corrective maintenance and aid in projecting life span of equipment to help ensure it is replaced before it fails, requiring a more costly repair.
The group's spending through June is 6.5% above budget. These costs include pole-top fire abatement and time crews spend helping other utilities through "mutual aid" agreements. The receiving utilities will eventually refund Grant PUD for this expense.
Federal money to increase dam safety, capacity present in giant infrastructure bill
The sweeping, $1 trillion, bipartisan "Infrastructure Investment and Jobs Act" that passed the Senate this week includes funding tagged for dam safety and capacity improvements that could benefit public utilities, including Grant PUD, commissioners learned.
Senate passage is a milestone, but the bill must still pass the House of Representatives before it heads to the President for signature.
Andrew Munro, senior manager of External Affairs, said the bill contains $125 million for new hydroelectric capacity, $75 million for other capacity increases and $553 million for safety improvements.
"We certainly have projects that qualify," Munro said of the funding. The External Affairs team will explore the details of applying for the funding, once it becomes available, he said.
Other federal money via a 30% investment tax credit for maintaining and enhancing hydropower could also be available for safety and environmental improvements and grid flexibility, he said. For public power, this would come in the form of a direct payment for eligible projects.
The funding is the result of years of PUD and National Hydropower Association lobbying efforts, he said.
"The big takeaway is that we're positioning hydropower really well here," Munro said.
Grant PUD has received $155,000 from the state to extend its fiber-optic network to Wanapum Village, in Yakima County on the Columbia River shoreline at Priest Rapids Dam. Another $258,000 in state funding could expand Grant PUD fiber for advanced, "precision" agriculture in Grant County and a $1.6 million state loan and grant is available to for network expansion.
2021 expenses estimated to finish the year slightly above budget target
Grant PUD's 2021 expenses are tracking somewhat higher through the first half of the year, with total direct expenditures of $260 million now forecast through year end, which is $4.7 million more than originally budgeted.
Lead Financial Analyst, Jeremy Nolan shared that 2021 capital expenditures are forecast to end the year at $120.1 million approximately 6% more than the planned $113.1 million budgeted.
Nolan outlined that year-end direct labor expenditures are anticipated to be nearly flat at $80.7 million, while operations and maintenance expenses is expected to be approximately 4% below budget at $59.2 million
Senior Manager of Financial Planning and Analysis, John Mertlich provided an overview of the capital expenditures saying the higher than anticipated capital spending is driven largely by adjustments in the scope for some of the electrical system projects as well as the expansion and connectivity work on the fiber-optic network.
General Manager/CEO, Kevin Nordt added that the utility continually strives be effective with allocated funding and focuses on utilizing resources to ensure critical work is getting completed and does not end up costing the district more in the future.
View the detailed presentation on pages 1-19 of the presentation materials. Listen to the discussion beginning at 40:00 on the commission audio.
Preliminary 2022 budget presented to the Commission
The Budget forecast for 2022 is still preliminary and as the 2022 budget process moves toward completion and an analysis will be completed to determine if any electric retail rate adjustments are warranted.
John Mertlich, Senior Manager of Financial Planning and Analysis reviewed the process and timeline for commissioners to review and approve the final budget for 2022. The initial filing provides a high-level overview of the proposed budget with a more detailed version to be released in the coming weeks. In October, the public will have an opportunity to provide input into the budget during planned public meetings.
Total preliminary budgeted expenditures for 2022 are currently forecast at $381.6 million with offset of nearly $103.2 million for net total budgeted expenditures of $278.5 million, but that is expected to vary as estimates continue to be finalized during the budgeting process.
Final commission review of the budget is planned for late October, with an anticipated vote to adopt the budget by the commission on Nov. 9.
View the presentation on pages 20-28 of the presentation materials. Listen to the discussion beginning at 1:27:10 on the commission audio.
—Heard about the projects and activities the Enterprise Technology group has been focusing on this year.
Chief Technology Officer, Derin Bluhm outlined the groups many accomplishments to-date in 2021.
Efforts included the deployment of Service Desk Plus that has enabled improved response times and outcomes for service desk and District staff, launching new business analytics infrastructure and a tool for recording close calls/incidents, completed the first tri-annual update to the utility's Oracle Customer Cloud Services (CCS), and updates telecom engineering is undertaking.
Bluhm also shared the cyber security group's work to protect Grant PUD's technology systems, estimating the organization experiences as many as one million attempted cyber-attacks each year.
See the full presentation and additional details on pages 59-83 of staff presentations and hear the discussion which begins at 4:01:15 of the commission audio.
— Unanimously approved a resolution to support Grant PUD's Employee Appreciate Event, planned annually to recognize the superior performance of its employee body, especially the extra efforts required during the COVID-19 pandemic to keep critical system operating and customers served. Planned for Sept. 16, the event will take place in-person but with COVID precautions in place on Crescent Bar island with food, games and speeches.
— Unanimously approved a 5-year, $3.2 million contract with Automation Exchange, a South Africa-based company to utilize their proven software service to provision, monitor and manage broadband service over the Grant PUD fiber-optic network. These tasks are currently performed less efficiently in-house by Grant PUD staff using multiple stand-alone systems. Commissioners Schaapman, Cox and Wilson all expressed concern about outsourcing the work to a company overseas. Commissioner Tom Flint said he supported the contract because software licensing, which can be a challenging process, would fall to Automation Exchange, not Grant PUD.
Chief Technology Officer Derin Bluhm, General Manager & CEO Kevin Nordt and Senior Manager of Wholesale Fiber Russ Brethower explained that staff performed due diligence and found that Automation Exchange is the most capable of handling open-access networks like those operated by area PUDs, including Grant. Bluhm said protections are in place to reduce risk and end the contract if Automation Exchange fails to perform. Its software will be hosted on Microsoft Azure cloud-hosted servers in the U.S., and Grant PUD will have the ability to take over control, if necessary, Bluhm said.A significant concern expressed by commissioners is the security of end-user data and how this new service might increase risks of hacks or data theft.Bluhm and Brethower explained that this new solution will provide no access to or visibility of end-user data. These will continue to be managed by the retail service providers.