Blog Archive

Thursday, September 19, 2019

September 24, 2019 Regular EPB Meeting

TENTATIVE REGULAR MEETING AGENDA
GLASGOW ELECTRIC PLANT BOARD
SEPTEMBER 24, 2019, 6:00 P.M.
1. APPROVAL OF AGENDA AND ANY ADDITIONS
2. CONSIDER MINUTES OF AUGUST 27, 2019 MEETING
3. CONSIDER REVIEW OF ELECTRIC RATE PERFORMANCE AND POSSIBLE APPROVAL OF RATE CHANGES
4. CONSIDER TVA LONG TERM PROPOSAL
5. CONSIDER PROGRAMMING COMMITTEE RECOMMENDATION
6. SUPERINTENDENT’S REPORT
A. AUGUST METRICS AND FINANCIAL METRICS REVIEW
B. OCTOBER FCA
C. CPD LEDGER
D. WINDSTREAM BANKRUPTCY
7. ADJOURN


MEMORANDUM
TO: Members of Glasgow Electric Plant Board
FROM: William J. Ray, PE
DATE: 9/19/2019
SUBJECT: Board Meeting Information
September Main Topics
Ø Continued Retail Rate Effectiveness Review
Ø Discussion of TVA Long Term Offer
Ø Programming Committee Recommendation
Ø Reports
📷October 1 FCA
Ø The October 2019 TVA FCA will increase to 1.528 cents per kWh. This is the first monthly increase to the FCA in the last few months, since the July increase. TVA’s explanation is that August sales and weather were in line with predictions, but rainfall was low, providing less hydro power than expected. That shortfall was replaced with higher cost coal generation and purchases of power from neighbors.
Ø On October 1, the energy component of our retail rates will adjust to reflect this anticipated increase to the wholesale cost of energy.
Action Items
Approval of Agenda and any New Items Desired by Board
Ø The present proposed agenda is attached to this narrative, but, as always, any board member can ask for additional items to be added.
Review and Approve Minutes of August 27, 2019 Meeting
Ø This is the customary review and consideration of formally adopting the proposed minutes for the last meeting.
Retail Rates Review
Ø We made a commitment to an Advisory Committee, and to the City of Glasgow, to conduct annual analysis of our retail electric rates. This is a sound business practice that should be followed, regardless of our commitments, and that review, which we began in August, will continue in the September meeting.
Ø As per the Board’s input, more gradual progress toward making EPB’s rates 100% non-volumetric, will be presented at the meeting for your consideration.
Ø Melanie Reed has completed her preliminary analysis of the performance of our various retail rates utilized by the different customer classes, and we will review those at the meeting, especially demonstrating the very small impact on total bills that would result from altering the Customer Charge, while reducing the kWh charge.
Ø It will be the Board’s decision on how we should proceed during September, and maybe October, as we move toward any adjustments necessary to stay the course.
Consideration of TVA Long Term Offer
Ø This matter really dovetails with the rate discussion above, and we will likely discuss both together, especially since the TVA offer would produce pretty dramatic changes in retail rate design.
Ø TVA’s new CEO has proposed a novel approach to the problem of declining energy sales, and that proposal is outlined in a document attached to this narrative, entitled “Long-Term Agreement.”
Ø This is a very complicated matter, but the simple elements are: TVA is willing to give LPCs a 3.1% credit to their power bills (for Glasgow, that means about $500,000 per year), they also want LPCs to alter their power contract to make the term a rolling 20-year agreement instead of the rolling 5-year term.
Ø There are many other “poison pills” in the proposed agreement, which is presently being reviewed by Ron Hampton.
Ø At the meeting, Ernie Peterson will be present to answer any questions about the proposed agreement that come up. Like I said, this is exceedingly complicated and will require much consideration, but it really must be considered along with our proposed actions which flow from the annual rate effectiveness study.
Consideration of Programming Committee Recommendation
Ø Due to an unreasonable rate increase proposal from the former vendor, who supplied the software and hardware for the local radar on Channel 9, we terminated our agreement with them. Since then, we’ve placed the NOAA weather radar on that channel, and many deem that unsatisfactory.
Ø Recently, a new vendor – WeatherPlay has made us a proposal to replace the NOAA weather radar with another product that seems more closely aligned with the former programming on Channel 9.
Ø The Programming Committee met and considered the cost and benefits of accepting the WeatherPlay offer, and unanimously voted to recommend we accept the offer.
Ø At the meeting we will quickly review some of the video and the pricing of this new product, for your consideration.
Reports
Ø AUGUST METRICS. Superintendent will do a brief review of the performance of the Glasgow EPB metrics for August.
Ø OCTOBER FCA. The Superintendent will go over the upcoming change to the Fuel Cost Adjustment for October, as dictated by TVA.
Ø CPD LEDGER. Since we altered our Variable Rate, at the request of an Advisory Council of our customers, to limit our peak predictions to four days per month, we have financial exposure when we miss the correct actual peak hour. To compensate for that exposure, we added a small amount to the wholesale cost of a peak kW, to collect funds to pay for missed predictions. The Superintendent will report on the status of that fund thus far in the fiscal year.
Ø WINDSTREAM BANKRUPTCY. Windstream Holdings (parent company of Windstream Company in Glasgow) filed Chapter 11 bankruptcy early this year. There is a large outstanding debt which is owed to EPB (about $40,000 now). To protect our interests and work to secure payment, as well as a suitable new relationship with Windstream going forward, I have engaged Scott Bachert, with the firm Kerrick Bachert PSC, to represent us in this matter. There will be a report on the progress at the meeting.
Friday, August 23, 2019

August 27, 2019 Regular EPB Meeting

TENTATIVE REGULAR MEETING AGENDA
GLASGOW ELECTRIC PLANT BOARD
AUGUST 27, 2019 - 6:00 pm
1. APPROVAL OF AGENDA AND ANY ADDITIONS
2. CONSIDER ENACTMENT OF GEPB RULES OF ORDER
3. REVIEW AND APPROVE MINUTES OF JULY 23, 2019 MEETING
4. CONSIDER RATIFICATION OF ADJUSTMENTS TO MATERIAL BID
5. CONSIDER PRELIMINARY REVIEW OF ELECTRIC RATE PERFORMANCE
6. CONSIDER TVA LONG TERM PROPOSAL
7. SUPERINTENDENT’S REPORT
A. JULY METRICS AND FINANCIAL METRICS REVIEW
B. SEPTEMBER FCA
C. CPD LEDGER
D. GLENVIEW HEALTH CARE BANKRUPTCY
E. WINDSTREAM BANKRUPTCY
8. ADJOURN

MEMORANDUM
TO: Members of Glasgow Electric Plant Board
FROM: William J. Ray, PE
DATE: 8/22/2019
SUBJECT: Board Meeting Information
August Main Topics
Ø Ongoing Discussion of Establishing GEPB Rules of Order
Ø Ratify Minor Changes to Materials Bid Authorized in July
Ø Preliminary Retail Rate Effectiveness Review and Discussion of TVA Long Term Offer
Ø Reports
📷September 1 FCA
Ø The September 2019 TVA FCA will decrease to 1.503 cents per kWh. This is the second monthly decrease to the FCA in the last two months, since the July increase. TVA’s explanation is that July sales and weather were in line with predictions, and ample rain provided more hydro power than expected.
Ø On September 1, the energy component of our retail rates will adjust to reflect this anticipated decrease to the wholesale cost of energy.
Action Items
Approval of Agenda and any New Items Desired by Board
Ø The present proposed agenda is attached to this narrative, but, as always, any board member can ask for additional items to be added.
EPB Rules of Order
Ø As we’ve all seen, proper compliance with Robert’s Rules of Order, as adopted by the Board earlier this year, was quite difficult due to the volume of rules contained therein, and the general lack of expertise on the many facets to Robert’s Rules.
Ø Since Glasgow EPB has operated quite effectively for over 50 years using simple parliamentary procedures to govern its meetings, the Board may want to consider adopting a written version of basic parliamentary procedure, perhaps customized to meet the specific desires of the Board, such that a return to less burdensome meeting procedures can occur.
Ø A copy of the parliamentary procedure document presented to you last month is attached again for the Board’s consideration. The document includes a few recommended changes, which would better reflect the established operational habits adopted by the EPB over the years. At the meeting this document can be discussed, and any desired alterations can be directed to the Superintendent. If the Board chooses to adopt the Rules of Order document, this document will be formally recorded in the minutes as to what meeting rules are in place for Glasgow EPB.
Review and Approve Minutes of July 23, 2019 Meeting
Ø This is the customary review and consideration of formally adopting the proposed minutes for the last meeting.
Consider Ratification of Changes to Materials Bid from July
Ø After the bid opening of "Transmission Project A" we separated items to find the best price for each item from each vendor. After the Board gave me authorization to proceed with purchase orders, we had a few instances where a vendor made contact with us requesting to be withdrawn from a couple of bids due to inaccuracy of their bid (bid wrong item or gave us wrong price), or instances where they bid materials together (buy all or none) to get us a better price (itemizing every quote still gets us a better price). After talking to each vendor and getting price changes on items such as Ductile Iron Poles, Fiberglass Crossarms, etc., the new price for the project was $241,544.39 vs. the original bid of $236,823.19, which you approved. This is not a material change on a project of this size -- an increase of only around $4700, but to get the minutes and the Purchase Orders to agree, we need you to ratify this change.
Preliminary Retail Rates Review
Ø We made a commitment to an Advisory Committee, and to the City of Glasgow, to conduct annual analysis of our retail electric rates. This is a sound business practice that should be followed, regardless of our commitments, and that review will begin to be shared with you at the August meeting.
Ø We will likely start off with a brief review of the presentation on the history of the EPB rate evolution, which ought to get everyone on the same page as to where we have been and where previous boards have set our course to follow.
Ø Melanie Reed has completed her preliminary analysis of the performance of our various retail rates utilized by the different customer classes, and we will review those at the meeting.
Ø It will be the Board’s decision on how we should proceed during September, and maybe October, as we move toward any adjustments necessary to stay the course.
Consideration of TVA Long Term Offer
Ø This matter really dovetails with the rate discussion above, and we will likely discuss both together.
Ø TVA’s new CEO has proposed a novel approach to the problem of declining energy sales, and that proposal is outlined in a document attached to this narrative, entitled “Long-Term Agreement.”
Ø This is a very complicated matter, but the simple elements are: TVA is willing to give LPCs a 3.1% credit to their power bills (for Glasgow, that means about $500,000 per year), they also want LPCs to alter their power contract to make the term a rolling 20-year agreement instead of the rolling 5-year term.
Ø There are many other “poison pills” in the proposed agreement, which is set to be considered by the TVA board on August 22. Like I said, this is exceedingly complicated and will require much consideration.
Reports
Ø JULY METRICS. Superintendent will do a brief review of the performance of the Glasgow EPB metrics for July.
Ø SEPTEMBER FCA. The Superintendent will go over the upcoming change to the Fuel Cost Adjustment for September, as dictated by TVA.
Ø CPD LEDGER. Since we altered our Variable Rate, at the request of an Advisory Council of our customers, to limit our peak predictions to four days per month, we have financial exposure when we miss the correct actual peak hour. To compensate for that exposure, we added a small amount to the wholesale cost of a peak kW, to collect funds to pay for missed predictions. The Superintendent will report on the status of that fund thus far in the fiscal year.
Ø GLENVIEW HEALTHCARE FACILITY BANKRUPTCY. This was a big surprise to us. At the meeting I will provide an estimate of our likely loss due to our security being lower than our exposure. This matter again points out the wisdom of getting adequate security on all commercial customers, no matter how trustworthy they believe themselves to be. This customer has paid their bills in proper fashion for decades. But, still, bad things happen to good businesses.
Ø WINDSTREAM BANKRUPTCY. Windstream Holdings (parent company of Windstream Company in Glasgow) filed Chapter 11 bankruptcy early this year. There is a large outstanding debt which is owed to EPB (about $40,000 now and increasing each month). To protect our interests and work to secure payment, as well as a suitable new relationship with Windstream going forward, I have engaged Scott Bachert, with the firm Kerrick Bachert PSC, to represent us in this matter. There will be a report on the progress at the meeting.
Conclusion
Please let me know if you have any questions before the meeting.
Friday, July 19, 2019

July 23, 2019 EPB Regular Meeting


TENTATIVE REGULAR MEETING AGENDA
GLASGOW ELECTRIC PLANT BOARD
JULY 23, 2019


1.  CONSIDER RULES OF PROCEDURE DOCUMENT

2.  REVIEW AND APPROVE MINUTES OF JUNE 25, 2019 MEETING

3.   ANNUAL COMPARATIVE REVIEW OF EPB METRICS

4. CONSIDER BIDS – MATERIALS FOR TRANSMISSION POLE
REPLACEMENT PROJECT

5. REVIEW AND CONSIDER PROGRAMMING COMMITTEE RECOMMENDATIONS

6. CONSIDER TEMPORARY AUTHORIZATION FOR EXECUTION OF DOCUMENTS

7.  SUPERINTENDENT’S REPORT

A. JUNE METRICS REVIEW
B. AUGUST FCA
C. CPD LEDGER
D. AG RULING ON GDT COMPLAINT – TRAINING COMPLETED
E. WINDSTREAM BANKRUPTCY
F. TVA DISCUSSION ON GREEN POWER PROGRAM ISSUE


 8.  ADJOURN  



MEMORANDUM
TO: Members of Glasgow Electric Plant Board
FROM: William J. Ray, PE
DATE: 7/19/2019
SUBJECT: Board Meeting Information
June Main Topics

Ø Consider Rules of Procedure document
Ø Annual Comparative Review of EPB Metrics
Ø Bids for Transmission Pole Replacement Project Materials
Ø Programming Committee Recommendations
Ø Temporary Authorization for Execution of Documents
Ø Reports


August 1 FCA
Ø The August 2019 TVA FCA will decrease to 1.673 cents per kWh. This is the first decrease to the FCA since May of this year. TVA’s explanation is that this decrease is due to higher expectations for hydro generation and lower purchased power and gas rates.      
Ø On August 1, the energy component of our retail rates will adjust to reflect this anticipated decrease to the wholesale cost of energy.

Action Items
         
Consider Rules of Procedure Document
Ø The Board voted at last month’s meeting to repeal Robert’s Rules of Order and develop a document centered around Parliamentary Procedure for operation of Board meetings.  All suggested changes have been incorporated into the document uploaded for your review.  Please review the Rules of Procedure document before the meeting.  

Review and Approve Minutes of June 25, 2019 Meeting
Ø This is the customary review and consideration of formally adopting the proposed minutes for the last meeting.

Annual Comparative Review of EPB Metrics
Ø We have access to a wide range of statistics on all TVA distributors.  At the meeting, we will present a review comparing EPB metrics to those of other TVA distributors.  This is presented to the Board on an annual basis.    

Bids for Transmission Pole Replacement Project Materials
Ø A bid opening for this project is planned for the afternoon of July 18.  I will have a full report on the bids and recommended vendors at the Board meeting.   
   
Review and Consider Programming Committee Recommendations
Ø At this month’s Programming Committee meeting, members voted to recommend addition of the ACC Network to the EPB’s cable lineup.  We do not yet have a final ACC Network agreement from NCTC for review.  If that is presented to us before the Board meeting, we will present it for your review.  Pricing for ACC Network was included in the rate increase that took effect July 1.
Ø At the July meeting, Committee members also voted to recommend execution of the Agreement for A&E Networks to secure pricing through 2022.  I will have a report on that pricing at our meeting.  
Ø The Programming Committee also voted to recommend approval of a new agreement for Viacom Networks, guaranteeing pricing through 2024.  I will also have a report on pricing for these networks.
Ø The Committee also considered signing a PCM from NCTC for negotiations on Fox Cable Networks.  PCM stands for Pre-Commitment Module and allows for NCTC to negotiate pricing with Fox Cable Networks on the EPB’s behalf.  The Programming Committee voted to recommend signature of this PCM.

Consider Temporary Authorization for Execution of Documents
Ø We will discuss written policy regarding execution of documents in my absence.

Reports
Ø JUNE METRICS. Superintendent will do a brief review of Glasgow EPB metrics for June.
Ø AUGUST FCA. The Superintendent will go over the upcoming change to the Fuel Cost Adjustment for August, as dictated by TVA.
Ø CPD LEDGER. Since we altered our Variable Rate, at the request of a committee of our customers, to limit our peak predictions to four days per month, we have financial exposure when we miss the correct actual peak hour. To compensate for that exposure, we added a small amount to the wholesale cost of a peak kW, to collect funds to pay for missed predictions. The Superintendent will report on the status of that fund thus far in the fiscal year.
Ø OPEN MEETING LAW TRAINING. The Kentucky Attorney General ruled on the appeal of Glasgow Daily Times, regarding their complaint against EPB which alleged violations of Kentucky Open Meetings Law. The ruling found EPB violated the law by failing to respond to the complaint in a timely matter, consistent with the law. The Board elected to attend the training recommended in the GDT complaint. Training on Open Meetings Law and Open Records Law was completed on July 15.    
Ø WINDSTREAM BANKRUPTCY. Windstream Holdings (parent company of Windstream Company in Glasgow) filed Chapter 11 bankruptcy early this year. There is a large outstanding debt which is owed to EPB (about $40,000 now and increasing each month). To protect our interests and work to secure payment, as well as a suitable new relationship with Windstream going forward, I have engaged Scott Bachert, with the firm Kerrick Bachert PSC, to represent us in this matter. Since last month’s meeting, Finance Manager Melanie Reed has filed a proof of claim with bankruptcy court, as well as filed claim against a Surety Bond the EPB held for Windstream.
Ø TVA GREEN POWER PROGRAM. As directed, I’ve reopened the subject of how the Green Power Program pays developers of distributed generation projects for the energy they produce, with TVA.  Ernie Peterson from TVA plans to attend the meeting and give a progress report on this topic.  

Conclusion

Please let me know if you have any questions before the meeting.