Electricity use combined with requests for electricity from the county's cryptocurrency firms has declined since the higher-cost Rate Schedule 17 for nascent, higher-risk industries was approved in 2018, commissioners learned Tuesday.
Cryptocurrency is currently the only industry in Grant County that Grant PUD qualifies as an "evolving industry" — a designation for customer groups who use electricity in a way that that presents higher-than-usual business or regulatory risk for Grant PUD and whose energy use could account for considerable percentage or concentration of total county demand for electricity.
Over the last year, the total energy used, combined with the outstanding requests for energy, by current and/or prospective cryptocurrency firms in Grant County declined from about 10% of total and forecast county demand for electricity, to approximately 3% — two points below the minimum 5% threshold for a nascent industry to meet the concentration-risk criteria for Rate Schedule 17.
"Rate Schedule 17 has proven to be a sound mechanism for managing the nascent industry risks. It is working as intended," Baxter Gillette, Large Power Solutions Manager, told commissioners.
Since the cryptocurrency mining industry does not currently meet the concentration risk minimum, staff has determined the county's existing six cryptocurrency firms no longer meet the "emerging-industry" criteria. Staff will determine in future weeks when the affected customers will move to other rate schedules, likely rate schedules 2 and 7, depending on their energy use.
Commissioner Tom Flint expressed concern that the value of bitcoin, the leading cryptocurrency, is on the rise. Bitcoin recently set a new all-time high and is currently valued at over $18,000 per bitcoin.
Bitcoin has again reached a value that sparked a boom in requests for electric service from cryptocurrency firms in 2017. If this happens again, now-existing policy would trigger Rate Schedule 17 — with its higher electricity prices — for these nascent, evolving-industry customers.
An inter-departmental team at Grant PUD analyzes the electric demand from the county's customers and determines, at least annually, if any industries or load activities should be included or removed from the evolving-industry designation, subject to Rate Schedule 17.
Hear the full discussion beginning at 57:00 on the commission audio. For more information, see pages 1-19 of the presentation materials.
— Heard from Fish and Wildlife Manager Tom Dresser that his department succeeded in reducing the "No Net Impact" fund by $106,000 this year. Grant PUD currently pays approximately $600,000 annually into a fund overseen by agency, tribal stakeholders and Grant PUD to compensate for impacts to juvenile salmonids as a result of operation of Priest Rapids and Wanapum dams. Payments into the NNI fund decline as Grant PUD achieves survival standards for yearling spring Chinook, summer Chinook, sockeye and steelhead. Grant PUD has made great progress in this area, Dresser said.
"I think things went extremely well this year, with the curve balls thrown at us by COVID," Dresser told commissioners. "The Fish and Wildlife staff is very adaptable." Hear the full discussion of the Fish and Wildlife quarterly business report at 2:05:45 on the commission audio. For more information, see pages 38-48 of the presentation materials.
— Heard from Manager of Cultural Resources, Brett Lenz who reported on the efforts of Grant PUD's River Patrol Team in helping protect an archaeological site from looting.
Lenz said earlier this fall the River Patrol team discovered a person attempting to remove culturally sensitive artifacts below Rock Island Dam near the mouth of Moses Coulee. It was the second time the same person was caught allegedly attempting to illegally remove artifacts. Douglas County prosecutors have charged the person with disturbing an archaeological site.
Lenz said the department's external stakeholders recently shared their appreciation for the team's effort in protecting the artifacts.
Through October the department is 37.8% below its forecasted budget for 2020. Lenz said this is mainly due to the impacts of COVID-19 that has limited the amount of summer fieldwork staff could accomplish, led to the current temporary closure of the Heritage Center as well as other impacts on the department's programs.
Hear the full discussion at 3:10:15 of the commission audio and see the presentation on pages 49-60 of staff presentation materials.
— Heard from Senior Manager of Wholesale Fiber, Russ Brethower as he provided a construction update of the 2020 fiber expansion areas. Brethower said permits and weather permitting, all residents and businesses within Areas 12 and 13 will have fiber available by year's end.
Starting in mid-January, some of the homes and businesses in Area 14 will begin to have service available with the entire area completed by mid-February. Area 15 will not be ready until mid-April.
Brethower and the commissioners also discussed the fiber expansion sequence list that was established in 2018 and how the boundaries were developed. The group discussed the protocols and procedures involved if customers choose to fund fiber construction to their location outside of the build-out sequence.
Hear the full discussion beginning at 1:36:05 of the commission audio
— Received an update regarding the various community engagement activities Grant PUD have most recently participated in. Community Relations Coordinator, Annette Lovitt shared that even though the impacts of COVID-19 altered some of the group's traditional plans, there were still multiple opportunities to meaningfully contribute and connect to with local communities throughout the county.
- Partnering with local non-profits as part of the utility's Pay-it-Forward program
- Supporting local food banks and community pantries
- Educational outreach efforts for students
- Electrical safety trainings for community partners
Select marketing efforts for various programs were also highlighted during the group's update. Hear the entire presentation beginning with 3:28:25 of the commission audio and on pages 61-79 of staff presentation materials.
— Heard that Grant PUD is meeting or improving upon most of its key strategic plan metrics through September. Metrics are goals for monitoring financial, organizational and operational progress throughout the organization, as well as outstanding customer service. Hear the full discussion of the Third Quarter metrics report at 2:57:15 on the commission audio. For more information, see pages 20-37 of the presentation materials.
— Approved new commission officers for 2021. Commissioners rotate annually into officer positions. The lineup, effective Jan. 1, 2021:
President:Larry Schaapman (taking over from Tom Flint)
Vice-President: Judy Wilson(taking over from Larry Schaapman)
Secretary: Nelson Cox(taking over from Judy Wilson)
Commissioner: Dale Walker
Commissioner: Tom Flint
Commissioners unanimously approved:
-A contract with Shell Energy North America for a 20% slice of Grant PUD's 63.31% share of generation from Priest Rapids and Wanapum dams. Shell Energy submitted the best bid for 3-year contract which will begin Jan. 1, 2021.
A contract with Shell for 53.31% for Grant PUD's share of the dams' generation expired in September 2020. The approved 20% slice contract is a new contract with Shell.
Slice contract holders benefit Grant by reducing water risk from year to year, sharing some operational risk, paying a premium for ancillary services and non-carbon attributes, and providing predictable revenue. These slice contracts are viewed favorably by Fitch, Moody's and other agencies that provide ratings for Grant PUD credit.
Commissioner Tom Flint thanked staff for their work on the agreement saying the contract is a good opportunity for the utility to reduce some of its water risk.
Hear the discussion at 2:41:12 of the commission audio and read more on pages 12-67 of the commission packet.
-Approved a change order to an existing contract with GE Steam Power, Inc. The change order increases the existing contract by $1,246,414 due to schedule delays and stop work notices due to the COVID-19 pandemic at Priest Rapids Dam which impacted the generator rehabilitation project.
Read more on pages 68-88 of the commission packet.
-Approved a change order with Arch Staff and Consulting, increasing the not-to-exceed contract amount by $3,750,000. Arch provides personnel with specialized experience needed on a temporary basis by Grant PUD across a wide range of current and planned projects. The change increases the total contract amount with Arch to $6 million. Grant PUD has contracted with Arch Staffing since November 2019.
Hear the discussion at 2:44:25 of the commission audio and read more on pages 89-96 of the commission packet.
-Approved a five-year $2,150,000 contract with RH2 Engineering to provide professional engineering services to support the utility's operations and various resources. RH2 was one of four companies that responded to a request for proposal in September. RH2 will provide, on as-needed project support on current, future work during the five-year not-to-exceed contract.Work may include support related to the maintenance, rehabilitation and upgrading of existing and new infrastructure facilities.
read more on pages 97-126 of the commission packet.