WEBVTT

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 Good morning, everyone. Sorry for the late delay. We are going to get started just a little bit late.

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 We do have another member coming in in just a little bit, and I am not prepared at the moment.

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 Here we are. We are the Sustainability Framework Advisory Committee.

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 It is Wednesday, August 31st, and it is 913, and we do have a quorum.

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 It has come to my attention that we have our first speaker, someone who has requested to speak,

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 and it is the Chair's discretion, and it is okay with me, but I want to make sure that it is okay with the members here as well.

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 And I do want to acknowledge that we have Mr. Stevens via webcam today before we get started.

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 Do we want to go ahead and have our speaker come up?

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 Scott Hazard, would you like to come on up? Yeah, come on up to the front. And we actually do not use the microphone there.

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 It is the microphones hanging from the ceiling. Thank you.

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 I am sorry? The white camera is working. We are being broadcasted as well. Just so you know, the white camera is working.

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 Oh, okay. I have got it. Thank you. Thank you for having me here today.

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 Seeing how I am speaking before the presentation, I will just go over a few things that you are going to hear in the presentation.

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 First of all, I would like to talk to you as two different people this morning.

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 First, as a homeowner who has invested in solar for his house, and secondly, as a professional who helps people go solar.

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 First, as a homeowner who has invested in his house, it is a little bit shocking to see my city, the same city that has worked so hard over the past decade,

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 to convince people, homeowners, to go solar and to do other sustainable energy efforts.

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 The same city that has given away literally millions of dollars in cash incentives to the same homeowners who they have been trying to convince to go solar.

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 Now making efforts that will knowingly hurt those who have converted to solar.

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 When we went solar at my house, our average utility bill for the 12 months previous was $130.

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 To that end, we financed a system for 20 years to cover our electrical usage, and the payment on that system is $133.

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 If we kill that metering, we will add about $50 to $60 to my personal electric bill every month on top of what I am already paying for my solar system,

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 which was recommended to me basically by the city of Denton.

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 I would also like to say that this isn't just me, this is every solar customer out there.

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 And that in Denton, we can't just switch to Green Mountain or somebody who is another utility company who is solar friendly.

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 We are locked into Denton Municipal Electric. We have no options. So this is not good.

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 I hope I am not the only one in this room who sees the city government assisting people in buying PV systems,

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 then enacting laws to make PV systems less efficient and indeed more expensive is plain wrong and is the opposite of sustainability.

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 Now, putting on my solar industry hat, let me clear up a few things that you are going to hear this morning from this presentation.

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 First of all, anybody in this room with a credit score of 640 or more, which is a very low bar,

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 can have a PV solar system installed on their house along the lines of what I did with a payment based on what you are already paying.

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 It ends up being about the same thing for most people unless your house is covered up with trees or other things or unless you are a very high electricity user.

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 So these solar systems are not for the wealthy elite. They do not have high upfront costs.

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 95% probably to 97% of my customers have purchased their solar system in this way and not a penny changes hands between the solar installer and the customer or between me and the customer.

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 It really is a matter of installing it and going from paying one to paying the other.

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 More than half of my customers are retirement age people or people who are close to retirement age who are setting themselves up for retirement by installing solar

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 and leveling out some of the billing peaks that you see from electrical usage throughout the year.

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 The Inflation Reduction Act that was signed a few weeks ago has additional solar centers for Americans, which it does. It bumps everybody up to 30%.

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 Regarding low income people and helping low income people, there is another 20% incentive for low income people in the Inflation Reduction Act.

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 There are different classes apparently of low income households or low income neighborhoods and I'll be honest with you, I have yet to do my research on that.

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 But there is another tier that bumps you up from a 30% to a 40% incentive and then yet another tier that bumps you up to a 50% incentive for people who have problems or income situations that might would prevent them.

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 But really, as I said before, if you can afford your current electric bill and if you have a credit score of 640 or more, you can have solar installed on your house that will cover your needs.

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 Please allow me to make some suggestions to you that might make up some of DME's shortfalls in what they're going to propose to you today.

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 Number one, create a post-solar account for customers. Many utilities that I work with do this throughout the state of Texas.

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 What this is, is when you go solar, after you're connected, now you have instead of a 15 or 20 dollar connection fee to the electric company, you have a 30 dollar connection fee to the electric company.

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 Some even increase the price you pay per kilowatt hour after you've gone solar.

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 If you use power above and beyond what you generate, that's billed at a little bit higher cost to help, again, make up some of the costs that the utility company has in administering everybody, including solar people.

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 Number two, the city of Denton, at the end of the month, when they compare my bill to what I have sent them and bill me for the net, that's called net metering, that's what they're trying to kill.

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 The city of Denton very generously pays me the wholesale rate for anything that I've produced over the month that is in excess of 100% of my usage.

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 They're the only utility company out there that does this that I know of. We don't need to be paying people back. Solar systems are designed to not send power back to the power company.

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 Even if you're going to pay me for it, you're paying me wholesale rates for it, it's still a losing proposition for me as a homeowner to send the city power back at the end of the month to have a credit because I'm paying more through the purchase of my solar system for those kilowatt hours than the city is giving me.

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 So to that end, we designed solar systems to achieve somewhere between an 80 and 100% offset.

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 Rebates. I asked for the rebates. I'll tell you. Yes ma'am.

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 I'm just going to say, we're almost out of time, so.

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 60 seconds.

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 Rebates from the industry side create everybody wanting to go solar all at once.

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 I'm sure from DME's perspective, rebates just your work stack goes from here to here in a day's time.

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 Rebates do have value to the customers. DME says their average rebate paid is $5,600.

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 I think that if we're going to keep rebates at the council, and you guys are wanting to recommend that we keep rebates, make it a flat fee.

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 Make it a flat $4,000 for everybody.

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 That'll give you almost twice the coverage that we're getting now with the rebates.

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 And $4,000 is enough money to motivate people to go solar.

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 The benefits to DME from my suggestions. Increased revenue through the post-solar program that I have recommended.

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 Increased revenue by not paying for excess generation.

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 Continued homeowner interest in solar, which helps us all. Which helps the Texas grid. It helps everybody.

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 And savings by getting free power from the spring months.

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 I've emailed you all a copy of my presentation, and I'll be happy to supply it to you guys.

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 There are some graphs here, and you can see, and it's only common sense.

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 In the spring months, we don't run our HVAC, yet we have this solar system on our roof that's designed to cover us in the summertime.

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 So in the spring, we're giving power back to DME.

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 And if they stop paying for that over generation, every household that has solar is going to give them a fair amount of power back over these three to four spring months.

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 That they're not going to pay for.

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 So that is yet another way that DME can recoup some of this money that they're talking about.

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 That's really all I've got to say. In conclusion, I'd like to say that there are a lot of ways to reduce upward pressure on rates.

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 Nobody's mentioned $4 an hour gas, or $4 a gallon gas, or any of the costs for everything are going up.

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 It's not just the solar companies, and it's not just the solar homeowners.

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 And I urge you to not let this happen to those people who you've convinced over the past decade to convert to solar.

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 Thank you.

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 Thank you, Mr. Hathaway. We appreciate your comments today.

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 All right, so we will move right along to our first item for individual consideration.

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 Receive a report, hold a discussion, and give staff direction regarding proposed update to the Green Sense Incentive Program and rates related to distributed generation from renewable sources interconnected within Denton Municipal Electric Service territory.

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 So Madam Chair, members of the PAB, members of the committee, my name is Tony Puendum, the General Manager for DME.

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 First of all, I just want to acknowledge we have a number of DME staff members here to try to make sure that we respond to any questions that you have.

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 We have Terry Nolte, who's our Assistant General Manager.

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 He's over our power supply.

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 Bill Sheppard, who's over our business services, will actually be doing a presentation.

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 We also have Elizabeth Ruiz, who's a long-term employee of DME and has been very involved with the Green Sense Program.

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 The first thing I want to mention is that we have ample time here.

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 We've certainly given you ample time today.

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 This is the only topic that you have.

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 Certainly appreciate you coming in on a special call meeting.

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 I was mentioning to the Chair that any change that we make, certainly I think at this point, certainly with the rebate,

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 would likely be next fiscal year, so it wouldn't be effective October of this particular year, just simply because of timing.

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 We still need to go to the PAB, get their recommendation, and then go to the Council for final direction.

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 If there is a change to the DGR, the distributed generation rate, likely we'd be looking at a January timeframe to make those changes,

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 again, pending the recommendations of this committee, the PAB, and then ultimately final direction of the Council.

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 So my message today is that we have time to continue to have discussions with you.

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 The other item that I'll mention is I know that there's a lot of different topics that may come up today,

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 and we're going to try to keep this to just the green sense issue.

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 I will tell you that we are planning to bring back to this committee an update to what is called the Den Renewable Resource Plan.

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 You may be familiar with that plan, but that sets the goal for VME to be 100% renewable, which, as a matter of fact, we accomplished in '21,

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 and Bill will talk to you a little bit about that some more.

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 There's also the topic of demand response, and that is a hot topic across the state of Texas and various utilities.

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 We are working on a program that will address that, and ultimately once we have that program sometime after the first of the year,

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 we will bring that back to you as well for discussion with you.

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 And then finally, just understand that there's a lot of issues going on in the electric market, as you can imagine,

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 not just as a result of Winter Storm URI, but a number of other issues.

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 We're continuously looking at those.

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 I will tell you that in the last now six years, DME has not raised rates. As a matter of fact, we've actually decreased rates within that timeframe.

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 Currently, if you look at our comparable utilities, both in the public sector and also in the private sector,

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 we have some of the lowest, if not the lowest, residential rates out there,

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 and that benefits all 61,000+ customers that we have in our utility system.

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 So with that, I just wanted to open that up. With that, I will go ahead and ask Bill Shepard to come up here and go through the presentation.

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 We would ask if you could hold your question, but certainly if there's something that's pressing, please just let Bill know and he'll go ahead and try to address your question.

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 If not, we'll wait until the end of the presentation.

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 Thank you, Tony. I'm going to get my screen up and then we'll get started here. Shift B, right?

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 Yes.

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 Can I take a moment to check in with Mr. Stevens to make sure he's good, and when the presentation's up, then you'll see it.

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 Mr. Stevens, you shouldn't see the presentation coming.

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 Okay, thank you.

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 There it is.

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 All right, good morning, Madam Chair, committee members. I'm Bill Shepard. I'm the executive manager of business services for DME.

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 I've never been in front of this body before, so thank you for having us, and it's nice to meet you. It's a pleasure talking to you today.

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 So today we're going to talk about our energy efficiency incentives, our green sense program, our solar rebates, and we're going to discuss some options with you.

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 And I'm going to have Michael Gagne come up a little bit later and talk about some more specifics on the green sense programs that his group oversees.

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 But before we get started, I did want to mention that as of 2021, DME met really an unparalleled milestone. And as of 2021, everything that DME buys to feed its load and then is 100% renewable energy.

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 So I think that's a huge celebration that we should all be proud of.

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 So our energy efficiency incentives, this is a whole list of them. I'm not going to go one for one, but we budget at a level of $500,000 to support these programs.

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 As you can see, most of them involve the building envelope, and there's a couple other ones that involve AC systems, too, in commercial.

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 Some of our stats over the last 12 years, we've issued 5,700 rebates for those program categories that I just showed you to the tune of about $2.1 million that we spent on those rebates.

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 So it's about $375 per measure. And through those measures, our customers have been able to reduce their usage well over 41 million kilowatt hours.

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 So you might ask yourself, what does that mean? What does that mean to reduce that much? Well, it's equivalent to about 3,400 homes, annual usage.

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 It's also equivalent to taking about 22,500 metric tons of CO2 off the system.

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 So really proud of those stats, and we'll hopefully continue to see those. But remember, as of 2021, DME is 100% renewable. So those are carbon-free, 100% renewable offsets.

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 So any reductions that these programs see are reductions of CO2 through across other industries that may be impacting the city.

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 Oh, before I go this way, let me go back. So just remember those impacts as we get into the solar part of the presentation because I'm going to make a point there.

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 But again, remember the amount we spent here and how much we've got for that expenditure.

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 All right. So our solar rebates are also budgeted at a rate of $500,000 a year. And that rebate varies whether it's a standalone PV system or a system that's coupled with batteries.

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 It also varies for the depending on the size of the system. We've made some tweaks across the years based on customer feedback just to try to extend the dollars that we have available across more systems.

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 So over that same 12 years and into this year, we've issued 605 rebates for solar systems, about $3.4 million we've spent on those rebates for an average of about $5,700 a system.

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 So as of right now, we have 854 systems connected to the DME grid and those systems produce about 7,200 kW. You might want to ask what that means. That's about 11,500,000 kilowatt hours those systems produce.

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 And that's equivalent to about 957 homes or taking 6,200 metric tons of CO2 off the system. So again, just reflecting back to the energy efficiency programs, a little bit bigger bang for the buck on incentivizing energy efficiency measures versus the solar.

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 Yes, sir. Just a clarification, please. On the 854 systems, you say 820 are residential. What are the others? Commercial. Okay. Yes, businesses.

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 All right, so on the bang for the buck, so not only is DME paying for the rebate, that $3.4 million, but we're also paying heavily for that energy coming back from those systems. Last year was $428,000.

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 So that energy coming back is paid at full retail. It is by far the most expensive energy that DME purchases on a regular basis and is in fact three times more than the renewable energy that we get through our COD.

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 So that gives you an idea of the relationship of what we're paying with these systems versus what we get for the rest of our portfolio.

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 So over the next few slides, we're going to talk about how rebates are no longer driving installs. We're going to show you that the prices have been coming down steadily over the last decade for systems, and that's based on research done by the National Renewable Energy Lab, NREL.

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 We're going to talk to you about our current billing structure and how it's really encouraging oversizing of systems because of our generous payback amounts. And then also, I set all this context to the fact that we're already 100% renewable.

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 So we should celebrate the fact that everything we purchase for our load is 100% renewable energy.

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 So this first graph shows that the blue bars are the systems that actually got rebates, and the orange bars are the ones that got put in even when the rebate dollars were exhausted. So you can see all the way back to 2017, we started seeing systems being installed, regardless of whether or not they got paid a rebate.

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 In fact, in 2021, that's the second bar from the bottom, more systems were installed without a rebate than were installed with a rebate, and we're on track to do that same thing this year. That's data up through, I want to say, May, May or June.

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 And we're steadily getting about 20 applications a month for systems. So it's not slowing down. So why are we seeing this? Why are we seeing so many systems get installed even without a rebate? It's because the cost is coming down.

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 This is that data put together by NREL, and it shows that 64% reduction. So not only is the cost of the system going down, but there's also some pretty generous federal tax incentives out there too. Mr. Hazard alluded to the fact that the most recent passing of the Inflation Reduction Act, it actually extended tax credits another 10 years at a level of 30%.

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 So that's pretty hefty. And DME doesn't feel that our rebate dollars are spent wisely going towards such a flourishing market already.

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 So I mentioned before that one of the big things that we're paying for is the energy coming back. Well, that energy coming back is really a product of two things. One is the generous amount of money that we're paying for that energy as a form of credit on the customer's bill.

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 That's a flaw in that net billing rate structure, and it's driving these systems to get larger. These are the systems over the years, and you can see how they've been put in larger and larger. Because of our payback structure, we're seeing systems put in that are probably a little bit bigger than the customers need.

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 And then second and probably more problematic is the fact that as these systems get oversized, they're actually offsetting more than just their variable cost of the power to serve them. They're actually offsetting their fixed cost charges too.

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 So when they do that, when they're effectively canceling out their bill, they're not paying their fair share for the fixed cost recovery portion of the system that's put in place to serve them.

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 So when their system is down, when it's dark, when it's raining, when it's cloudy, we have to serve that customer's load. Not 10%, not 20%. We've got to be there for 100% of their load. We're obligated to do that. And we are, and we continue to be.

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 So who's paying that shortage? It's the rest of our DME customers. It's those 61,000 customers that Tony mentioned earlier. And they pay that in the form of upward rate pressure and the rates to support that system.

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 So if you recall what I already said, we're already 100% renewable. So those customers are effectively paying twice for that same renewable benefit.

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 This seems like the crux of the matter, and I can't wrap my head around it. You got me closer. I just wondered if you could say that again, because I'm not understanding how the existing solarized homes are being subsidized effectively by all the other rate payers.

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 It seems like everybody always pays for DME energy all the time. And here's a set of folks that only pay in certain times. So it seems like that's better. I understand that you're trying to tell me something else, but I can't quite get it. Can you just say that again?

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 Yeah, absolutely. And that's actually a great question. So some of the systems that are built such that at the end of the year, they have a net zero balance paid to DME. So some months they get a credit, some months they pay out.

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 At the end of the year, it's a bigger credit going to them than a payment coming to us. And those are the systems that I'm really talking about. But that adding and flowing throughout the year at any given time, we're paying for energy at a full retail rate.

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 That full retail rate encompasses everything. It's the fixed cost charges and the variable cost charges. So for every kilowatt hour they're offsetting, that's a fixed cost component that's not being recovered by that customer.

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 So it makes it difficult and it does put some upward rate pressure on the rest of our system because we're not recovering those fixed cost charges across our full customer base. Does that help?

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 That does help.

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 Yes, sir. So we're talking about systems that generate more than 100% of the household's needs. Is that what we're saying? That if somebody generates more than 100% more than what they use, that's when the city credits them or pays them.

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 For that excess electricity over 100%. Does that make sense?

00:27:38.000 --> 00:28:07.000
 Yes and no. So there's an extreme example of a customer that's well oversized and like I had mentioned before, by the end of the year there's more of a credit going to that customer than a payment coming to us. But at any given time, at any given month, there can be flow coming from that customer. And the way we do our net billing is we pay a full retail rate for that flow coming to us. Does that make sense?

00:28:07.000 --> 00:28:08.000
 Yes.

00:28:08.000 --> 00:28:28.000
 Okay. And then during the nighttime when they're using our system, we're effectively a battery for that customer, during the nighttime they're paying us that same retail rate, only a little bit less because we're tacking on a little bit of a solar premium on top of the retail rate that we're paying them.

00:28:28.000 --> 00:28:47.000
 Now, if you look at one month and have a total going out and a total coming in, to the extent that they send us energy that exceeds what they've used from us, then we're only paying that premium portion, that solar portion which at this point is like 3.8 cents.

00:28:47.000 --> 00:29:02.000
 What about a system that, say, covers only 30 or 40% of what the household needs, say an all electric home, but it's a small system, doesn't even come close to 100%.

00:29:02.000 --> 00:29:21.000
 In other words, this system, these people, still pay a sizable bill to DME because they can't produce all of their power and don't have, say, battery storage to have power overnight.

00:29:21.000 --> 00:29:49.000
 It doesn't seem fair that those people are seemingly, and I think they might think this, that they're being penalized for having a smaller system that is doing its share, for sure, to pay its portion of the electricity that they get off the grid.

00:29:49.000 --> 00:29:51.000
 Does that make sense?

00:29:51.000 --> 00:29:55.000
 Yeah, no, no, it makes perfect sense and actually it's a great question and it's a great point to make.

00:29:55.000 --> 00:29:57.000
 So, homes have a baseline usage.

00:29:57.000 --> 00:29:59.000
 What does?

00:29:59.000 --> 00:30:01.000
 A home has a baseline usage.

00:30:01.000 --> 00:30:06.000
 You've got the refrigerator, you've got the water heater, you've got just the things that are going on in the home all the time.

00:30:06.000 --> 00:30:16.000
 To the extent that that smaller system covers the usage of those things that are baseline there every time, we might not see anything coming back from that system.

00:30:16.000 --> 00:30:20.000
 It just might be overall reducing that bill on a monthly basis.

00:30:20.000 --> 00:30:35.000
 And that's really the most cost effective way to size a PV system is to actually slice off that base and now you're getting what's equivalent to a full retail benefit because you're not buying that kilowatt hour from DME.

00:30:35.000 --> 00:30:36.000
 Does that make sense?

00:30:36.000 --> 00:30:43.000
 So even though there's not a money transaction going back and forth, that system is offsetting that base load.

00:30:43.000 --> 00:30:47.000
 Can I jump in and just say is that the system that you're concerned about?

00:30:47.000 --> 00:30:50.000
 No, that's not really the systems we're concerned about.

00:30:50.000 --> 00:30:54.000
 We're concerned about the systems that are very much oversized.

00:30:54.000 --> 00:30:55.000
 Did you have one?

00:30:55.000 --> 00:30:56.000
 Yeah.

00:30:56.000 --> 00:30:58.000
 Do we know?

00:30:58.000 --> 00:31:06.000
 I want to make sure that we're clear about that question because, and I apologize, Terry Nolte, Assistant General Manager.

00:31:06.000 --> 00:31:12.000
 This is a really important point and Mr. Briegel, you brought it up, but I want to make sure we're clear on this.

00:31:12.000 --> 00:31:23.000
 It's not just the systems that are overproducing relative to their consumption and sending surplus back to us that create this inequity.

00:31:23.000 --> 00:31:43.000
 When I talk about inequity, I'm talking about the fact that as a utility, our fixed costs, that would be for the cost of poles, wires, transformers, substations, things like that, we are required by law to be the supplier of last resort to every customer.

00:31:43.000 --> 00:31:51.000
 So when the solar system is not running, I still have a requirement to provide that energy to them.

00:31:51.000 --> 00:32:02.000
 It costs me the same to build the system to serve a home that has a solar generator, a rooftop solar system, as it does to serve one that doesn't.

00:32:02.000 --> 00:32:12.000
 Regardless of the size of the system, we still have to invest the same amount of money in order to provide that backup for that system.

00:32:12.000 --> 00:32:25.000
 Those are some costs that in cost of service rate making, we distribute those costs and recover them to have rate sufficiency from every customer.

00:32:25.000 --> 00:32:39.000
 So when a solar panel is put on a home under our current system, we do not recover that fixed cost, their share of the cost to serve that home.

00:32:39.000 --> 00:32:49.000
 So in a system like Bill was talking about, a large system where they net zero through the year, so they never pay DME any money,

00:32:49.000 --> 00:33:04.000
 what happens is that shortfall of recovery of that fixed cost, which is in our base rate and our facility charge, has to be collected from the rest of the rate base in order to have revenue sufficiency.

00:33:04.000 --> 00:33:14.000
 So that is really the underlying issue here when we talk about equity and the equity between those 800, how many systems Bill?

00:33:14.000 --> 00:33:15.000
 854.

00:33:15.000 --> 00:33:24.000
 854 and the 61,000 customers that are effectively cross-subsidizing those systems.

00:33:24.000 --> 00:33:36.000
 That's kind of the, to your point Mr. Briggle, I hope that helps explain what we're getting at. So it's not just the large system, it is the smaller systems as well,

00:33:36.000 --> 00:33:48.000
 because to the extent, let's say they would consume 1,000 kilowatts every month normally, but because they have a solar system, they're only consuming 500 kilowatts.

00:33:48.000 --> 00:33:55.000
 We are losing the fixed cost component of that 500 kilowatts.

00:33:55.000 --> 00:34:11.000
 That fixed cost component that we're losing has to be collected from the rest of the rate base in order to have rate sufficiency and to meet our debt coverage ratios and all the other kind of financial metrics that we have to meet.

00:34:11.000 --> 00:34:16.000
 How do you break down fixed costs for individual systems?

00:34:16.000 --> 00:34:28.000
 We do what's called a cost of service study and we actually look at every asset that we have in our system and we allocate the cost to each rate plus.

00:34:28.000 --> 00:34:39.000
 So for a residential customer, we know precisely what it is. It's $64 change per month that we need to collect.

00:34:39.000 --> 00:34:41.000
 Regardless of the size of the system?

00:34:41.000 --> 00:34:52.000
 Regardless, because remember what I said, it cost me the same to build a system to serve your home that has a solar panel as it does my home that doesn't have a solar panel.

00:34:52.000 --> 00:35:18.000
 Still have to put a wire, still have to build the poles, structures, the capacitors, the transformers, the substations, all that equipment still is required for you to both deliver energy to me, to DME, as a solar provider and for me to provide energy to you at night when the solar panel is not running.

00:35:18.000 --> 00:35:20.000
 Does that make sense?

00:35:20.000 --> 00:35:25.000
 I know we wanted to hold questions, but this is really important for us to understand. So Brian, go ahead.

00:35:25.000 --> 00:35:43.000
 So we got the $425,000 in buybacks annually that DME pays out to solar producers. Out of the 854 systems, are we aware of how many of those you're concerned are designed to be overbuilt, that is they produce more than their net usage over the year?

00:35:43.000 --> 00:35:45.000
 I'm just curious about the scope of this issue.

00:35:45.000 --> 00:35:56.000
 So we're starting to dig into that data a little bit more. On average, annually it's about 25% of those systems are net producers versus takers from us.

00:35:56.000 --> 00:36:04.000
 But at certain times in the shoulder months, i.e. the springs and the falls, those numbers can be upwards of 50%.

00:36:04.000 --> 00:36:17.000
 So it is a good portion of them and I might have misspoken a little bit more. I mean, there's three components here. There's the facility charge that we're collecting that can be offset by the larger systems.

00:36:17.000 --> 00:36:24.000
 But there's also the regular charge that comes back by any system when they send energy back to us.

00:36:24.000 --> 00:36:38.000
 And then the third thing is that offset of usage that we expect to sell to that customer that they're no longer buying from us, their system is producing it. So all of those have an impact to us.

00:36:38.000 --> 00:36:46.000
 Does anyone else have a question about this specific topic before we move on?

00:36:46.000 --> 00:36:47.000
 Okay.

00:36:47.000 --> 00:36:48.000
 We good?

00:36:48.000 --> 00:36:49.000
 Yeah, thank you.

00:36:49.000 --> 00:36:59.000
 Okay. So this actually demonstrates that $428,000 that I was talking about. So that last blue bar shows what we paid last year.

00:36:59.000 --> 00:37:12.000
 That's $428,000 of that energy coming back to us. This year it's projected to be closer to $700,000 and you can see how quick that slope of that curve is going into the next few years.

00:37:12.000 --> 00:37:20.000
 So, as a matter of fact, in six years we're paying about $5.6 million if we don't change anything for that energy coming back to us.

00:37:20.000 --> 00:37:29.000
 And now, just to put that into context, every $1.5 million is about a 1% increase in rate pressure that we're seeing.

00:37:29.000 --> 00:37:37.000
 Is this chart what we're looking at, the progression? What does that take in? Is that taking new, how many new systems are coming online?

00:37:37.000 --> 00:37:41.000
 Yes, that's our projection of what we've seen in the last few years.

00:37:41.000 --> 00:37:44.000
 What are you estimating here each year?

00:37:44.000 --> 00:37:48.000
 This is the amount of energy flowing back to us from those systems.

00:37:48.000 --> 00:37:53.000
 Right, but how many systems are you estimating each year in this chart?

00:37:53.000 --> 00:37:59.000
 We didn't really look at it on a per system basis. What we looked at it on is a per kilowatt hour basis.

00:37:59.000 --> 00:38:03.000
 So the kilowatt hours that are flowing back are growing exponentially.

00:38:03.000 --> 00:38:10.000
 So if there weren't any more solar installations added from this point, would the chart still look like this?

00:38:10.000 --> 00:38:15.000
 No, it would level out.

00:38:15.000 --> 00:38:22.000
 I have one more, and I don't know if this is the appropriate place to ask it.

00:38:22.000 --> 00:38:42.000
 What about systems such as Mr. Hazard's, which he purchased himself without any city incentives or rebates?

00:38:42.000 --> 00:38:50.000
 Is a separate category made for people who have purchased without city help?

00:38:50.000 --> 00:38:54.000
 It seems like everything is being lumped together.

00:38:54.000 --> 00:39:05.000
 I still see differences between my neighbor who has a full system and a battery and the whole thing,

00:39:05.000 --> 00:39:16.000
 and someone such as myself who has a 3,000 watt system that generates, if I'm lucky, 40% of my energy,

00:39:16.000 --> 00:39:22.000
 which I bought myself because there was no Greensense program when I bought my system.

00:39:22.000 --> 00:39:47.000
 I don't understand how everybody would be affected by this change when not everybody is in the same boat initially.

00:39:47.000 --> 00:39:52.000
 You'll see when we get to our options, there's two things that we're looking at.

00:39:52.000 --> 00:39:56.000
 One is the rebate. We want to do some changes to that.

00:39:56.000 --> 00:40:01.000
 And then two is the net billing that we're paying for the energy coming back to us.

00:40:01.000 --> 00:40:06.000
 So all of those systems are hitting that latter part.

00:40:06.000 --> 00:40:10.000
 The rebate is something that we can stop moving forward.

00:40:10.000 --> 00:40:15.000
 Does that help?

00:40:15.000 --> 00:40:19.000
 All right, so just the last point on this slide.

00:40:19.000 --> 00:40:23.000
 That's just not a sustainable way to treat that billing structure,

00:40:23.000 --> 00:40:31.000
 is to continue to increase throughout the years and not make any changes.

00:40:31.000 --> 00:40:32.000
 So this is a comparison.

00:40:32.000 --> 00:40:35.000
 It's a little busy when I'm looking at it from up there,

00:40:35.000 --> 00:40:42.000
 but maybe you all can see it on the presentation that went to you all personally.

00:40:42.000 --> 00:40:47.000
 This is a compare to our peers across the state of Texas, our public power peers.

00:40:47.000 --> 00:40:52.000
 And it's using an example of a customer that is using 800 kilowatt hours from us

00:40:52.000 --> 00:40:56.000
 and sending a thousand kilowatt hours back to us.

00:40:56.000 --> 00:41:01.000
 So putting everybody on that level field, you'll see all of those utilities,

00:41:01.000 --> 00:41:06.000
 with the exception of Austin Austin is a little bit of a unique issue in and of itself,

00:41:06.000 --> 00:41:10.000
 how they bill for solar and charge back.

00:41:10.000 --> 00:41:15.000
 But the rest of those utility companies there are collecting a portion of,

00:41:15.000 --> 00:41:18.000
 or sometimes all of their fixed costs.

00:41:18.000 --> 00:41:23.000
 So they're not seeing that cross-subsidy that we're seeing within our system.

00:41:23.000 --> 00:41:30.000
 They've also, on that second column there, you've seen that the majority of them do not provide rebates.

00:41:30.000 --> 00:41:32.000
 As a matter of fact, some go one step further.

00:41:32.000 --> 00:41:34.000
 And actually, as Mr. Hazard alluded to,

00:41:34.000 --> 00:41:38.000
 they don't pay for anything that's in excess of the customer's usage.

00:41:38.000 --> 00:41:45.000
 So that's just sort of a gift to the utility, those extra kilowatt hours that are beyond the customer's usage.

00:41:45.000 --> 00:41:47.000
 So that sort of lays them all out there.

00:41:47.000 --> 00:41:55.000
 But one point I wanted to call to the attention of this graph is all of those utilities you see listed there, Austin included,

00:41:55.000 --> 00:42:00.000
 DME is the only one that supplies 100% renewable for their customers.

00:42:00.000 --> 00:42:10.000
 And we have one of the most generous paybacks to customers.

00:42:10.000 --> 00:42:15.000
 So this is a map of the solar installation, those 854 installations across town.

00:42:15.000 --> 00:42:21.000
 I draw that circle just to emphasize that big gap in the older parts of town,

00:42:21.000 --> 00:42:25.000
 or the parts of town that may have poorer housing stock.

00:42:25.000 --> 00:42:29.000
 It's not just a matter of income when it comes to install a solar system.

00:42:29.000 --> 00:42:32.000
 You have to have a roof that's able to hold it.

00:42:32.000 --> 00:42:38.000
 You have to have a building envelope that's not leaky and has broken windows or a broken air conditioning system.

00:42:38.000 --> 00:42:44.000
 You want to put on a system that's already assigned to a pretty efficient household.

00:42:44.000 --> 00:42:49.000
 But any which way, that's just to emphasize the fact that where you see those gaps,

00:42:49.000 --> 00:42:58.000
 those are the customers that we're talking about that are subsidizing the ones that have systems.

00:42:58.000 --> 00:43:01.000
 So all that information brings us to some options.

00:43:01.000 --> 00:43:04.000
 Option one is pretty much status quo.

00:43:04.000 --> 00:43:06.000
 We just keep going the way it is.

00:43:06.000 --> 00:43:12.000
 We'll continue to put out rebates to customers who probably don't need them.

00:43:12.000 --> 00:43:19.000
 And we'll continue to pay a retail rate for the energy coming back to us and continue to see that upward rate pressure.

00:43:19.000 --> 00:43:22.000
 Option two, we sunset the solar rebate

00:43:22.000 --> 00:43:30.000
 and instead redirect those funds to other green sense efficiency programs that have that bigger bang for the buck that we talked about.

00:43:30.000 --> 00:43:32.000
 This does not have an impact.

00:43:32.000 --> 00:43:36.000
 It doesn't lower the rate impact or the upward pressure on the rates,

00:43:36.000 --> 00:43:43.000
 but it rechannels some of those dollars to what we feel are more cost effective programs.

00:43:43.000 --> 00:43:49.000
 And then the final option three is everything that option two says, all the benefits of option two,

00:43:49.000 --> 00:43:56.000
 only it restructures our net billing, so it'll lower that amount that we're paying for all that energy coming back from those systems,

00:43:56.000 --> 00:44:01.000
 putting it more in line with those other utilities and paying out an ECA rate.

00:44:01.000 --> 00:44:06.000
 That first year savings for that is anticipated to be about $700,000 a year.

00:44:06.000 --> 00:44:12.000
 And as those systems continue to be installed, which would be no reason why they wouldn't,

00:44:12.000 --> 00:44:17.000
 that savings opportunity will increase.

00:44:17.000 --> 00:44:22.000
 Well, really what I was going to do, before I got into the staff recommendation,

00:44:22.000 --> 00:44:31.000
 I was going to have Mr. Gagne come up and talk about what he would do with some of those funds if they were rechanneled to the other green sense programs.

00:44:31.000 --> 00:44:32.000
 Could I ask my question?

00:44:32.000 --> 00:44:35.000
 Sure, yes.

00:44:35.000 --> 00:44:41.000
 Does this include commercial and industrial installations as well?

00:44:41.000 --> 00:44:43.000
 PV, yes. It includes all the PV.

00:44:43.000 --> 00:44:50.000
 Okay. Have any rebates been given to large commercial or industrial?

00:44:50.000 --> 00:44:54.000
 Yes.

00:44:54.000 --> 00:44:58.000
 I'm just wondering what their response to this would be.

00:44:58.000 --> 00:45:01.000
 Anyway, I think we're good to talk to them.

00:45:01.000 --> 00:45:07.000
 Well, again, so the larger that base load, the less energy we're seeing coming back to us.

00:45:07.000 --> 00:45:12.000
 The bigger impact to us is that offsetting of sales in those cases.

00:45:12.000 --> 00:45:18.000
 Thank you.

00:45:18.000 --> 00:45:23.000
 Michael Gagne, Director of Environmental Services and Sustainability for City of Denny.

00:45:23.000 --> 00:45:28.000
 So just as you saw back on slide three, there's various energy efficiency programs or incentives that we're focused on.

00:45:28.000 --> 00:45:36.000
 I just want to take a moment to make sure the public is aware that at the ENERGY STAR website, the EPA website, most of those programs are covered.

00:45:36.000 --> 00:45:40.000
 There's metrics there you can play with. You can look at your house, do different things with it.

00:45:40.000 --> 00:45:48.000
 It's a good resource, so the incentive programs we generally have are also recommended and anchored off the ENERGY STAR.

00:45:48.000 --> 00:45:53.000
 So looking at the actual energy efficiency programs that were outlined on slide three earlier,

00:45:53.000 --> 00:46:01.000
 the most use is coming through the HVAC system upgrade that goes for both single-family and multi-family.

00:46:01.000 --> 00:46:04.000
 Also, our smart thermostats are a big user.

00:46:04.000 --> 00:46:07.000
 Then the next three somewhat get grouped together.

00:46:07.000 --> 00:46:12.000
 To me, the windows, insulation, solar screens are all similarly used.

00:46:12.000 --> 00:46:17.000
 And then ductwork, ceiling improvements on the actual ductwork is the next.

00:46:17.000 --> 00:46:25.000
 Radiant barriers are somewhat tricky. Those are usually better done either at the time of re-roof or at new build, so they're not quite used as much.

00:46:25.000 --> 00:46:31.000
 And we haven't seen anybody take up the solar hot water heater or our weatherization materials.

00:46:31.000 --> 00:46:41.000
 So on the far right, it's just a graphic representation of if you look at some of those categories on the money we invested into those to what we're getting back at.

00:46:41.000 --> 00:46:44.000
 So it's just a different little graphic representation.

00:46:44.000 --> 00:46:50.000
 So now to take the big mouthful. If you listen to the presentation from Bill and all the different things,

00:46:50.000 --> 00:46:55.000
 this slide attempts to summarize everything that's been touched on within the Greensense program.

00:46:55.000 --> 00:47:02.000
 So it gets that million dollars total. As you walk through it, the left-hand side talks to the programs.

00:47:02.000 --> 00:47:07.000
 The second column is total participation from 2017 through 2021.

00:47:07.000 --> 00:47:11.000
 The next column, or the center column, is our current program budget.

00:47:11.000 --> 00:47:16.000
 In other words, the amount of dollars currently budgeted for each of those efforts.

00:47:16.000 --> 00:47:21.000
 Then you get to the current cost structure. Far right is our proposed cost structure.

00:47:21.000 --> 00:47:30.000
 Effectively, on most of these, we want to go up. So we want to actually increase the amount of rebate that would go out for those affected areas.

00:47:30.000 --> 00:47:33.000
 Some things on here, as you'll see, are recommended to be removed.

00:47:33.000 --> 00:47:39.000
 To be determined, we haven't had the audit programs for energy and water audits were paused during COVID.

00:47:39.000 --> 00:47:43.000
 And we're currently looking to seek to get a contractor on board again.

00:47:43.000 --> 00:47:47.000
 And that's why that's kind of to be determined at this point.

00:47:47.000 --> 00:47:51.000
 But that was just what we would change within the current program.

00:47:51.000 --> 00:47:54.000
 We're also looking to some potential additions.

00:47:54.000 --> 00:48:00.000
 So with the additions, we recently did a fan giveaway program that was well received, well respected.

00:48:00.000 --> 00:48:02.000
 We want to continue that going forward.

00:48:02.000 --> 00:48:06.000
 Weatherization. You saw that it wasn't used under the current rebate program.

00:48:06.000 --> 00:48:14.000
 We want to change that. Instead of doing a rebate, we want to actually look at possibly buying the kits to help people get the materials they need to do that weatherization.

00:48:14.000 --> 00:48:18.000
 Also do targeted education and outreach to help them make that happen.

00:48:18.000 --> 00:48:24.000
 So change how we're doing that. Instead of saying, hey, go do it, come back for a rebate, we want to change that program.

00:48:24.000 --> 00:48:26.000
 Also, HVAC programs are a great thing.

00:48:26.000 --> 00:48:34.000
 If you can't afford to either keep it up or keep up with it on an annual basis, that system is not as efficient, doesn't last as long, all kinds of things.

00:48:34.000 --> 00:48:40.000
 So we want to add in a tune-up rebate to help people actually do the maintenance on their systems annually.

00:48:40.000 --> 00:48:50.000
 We also want to expand and try to look more further at the multifamily to make a bigger impact on multifamily properties to make the impact on those residents.

00:48:50.000 --> 00:48:55.000
 The bottom two get into basically appliances, but there's Energy Star appliances.

00:48:55.000 --> 00:49:01.000
 And if you're lucky enough to have a pool, pool pumps can be a large demand on your system year-wide.

00:49:01.000 --> 00:49:10.000
 Is this currently available funding or is this only potentially available funding given the options presented?

00:49:10.000 --> 00:49:15.000
 This is funding in the Greensense program that would have to be reallocated or reshuffled.

00:49:15.000 --> 00:49:23.000
 So if we stop doing some of the PV incentives, things like that, those dollars would then go to these new potential program additions.

00:49:23.000 --> 00:49:25.000
 Does that answer your question?

00:49:25.000 --> 00:49:32.000
 And Michael, how much CO2 reduction do these programs take out?

00:49:32.000 --> 00:49:42.000
 Like if we take away the solar that removes the CO2, how does this environmental sustainability committee,

00:49:42.000 --> 00:49:50.000
 so if we're adding these programs in, how does that compare to the CO2 that we're not removing?

00:49:50.000 --> 00:49:55.000
 First and foremost, we're 100% renewable currently through DMV, but the second part to that question is

00:49:55.000 --> 00:49:59.000
 without knowing how many people are using it, I can't do that calculation.

00:49:59.000 --> 00:50:04.000
 I can estimate on how much usage is there. I can't do that. These are just expansions.

00:50:04.000 --> 00:50:09.000
 I don't have that calculation because again, we don't know how many people would actually be using them to be able to do that calculation.

00:50:09.000 --> 00:50:13.000
 That's a little premature at this point, unfortunately. Does that make sense?

00:50:13.000 --> 00:50:22.000
 Yeah. I would just have estimations on what programs can do, so I just thought maybe we would have that.

00:50:22.000 --> 00:50:24.000
 Okay, thank you.

00:50:24.000 --> 00:50:28.000
 So to take all of my slides and kind of put them on one, this will help.

00:50:28.000 --> 00:50:35.000
 The far left-hand side is possible additions. Those are things we'd like to add in if we could reuse the money differently.

00:50:35.000 --> 00:50:42.000
 The middle section is removals. The bulk of that removal, if you look at that, the bulk of that removal would be the PV install incentives.

00:50:42.000 --> 00:50:49.000
 There's really the big change there, the biggest dollar, and the far right-hand side summarizes some of the changes.

00:50:49.000 --> 00:50:52.000
 Some of those, we want to actually increase the amount of rebate.

00:50:52.000 --> 00:50:58.000
 One thing we do want to lock in flat rate is on the smart member stats. We did a 50% or up to $50.

00:50:58.000 --> 00:51:04.000
 We'd probably just recommend doing that as a flat $50. That's not specifically on this slide. It was on two slides earlier.

00:51:04.000 --> 00:51:09.000
 So this is just the overall summary of how we would use that.

00:51:09.000 --> 00:51:16.000
 And once we go down the road of seeing how we can push the funds and see what the estimate is for the users on all the various rebates,

00:51:16.000 --> 00:51:22.000
 then we can come back with a recommendation on the CO2 impacts on that, to your question prior.

00:51:22.000 --> 00:51:26.000
 So with that, I'm going to turn it back over to Bill to go through staff recommendations.

00:51:26.000 --> 00:51:31.000
 So I know this is your last slide, and I was looking at this the other night.

00:51:31.000 --> 00:51:38.000
 Demand response is listed under removals, but when we were talking the other day, I didn't think we had any demand response.

00:51:38.000 --> 00:51:46.000
 And I thought somebody just said, we're thinking about doing demand response. So I don't understand how we could remove it.

00:51:46.000 --> 00:51:53.000
 Yeah, I think from the context of removal, it's really bringing it back to DME and having DME looking at demand response.

00:51:53.000 --> 00:51:58.000
 That's one of the things that we're going to be doing next year, is looking at demand response programs.

00:51:58.000 --> 00:52:01.000
 So it's going to be pulled out of the green sense category.

00:52:01.000 --> 00:52:08.000
 Thank you.

00:52:08.000 --> 00:52:17.000
 Okay, so in summary, we're looking at those three options. Again, option one, status quo, no impact to the programs that we have right now.

00:52:17.000 --> 00:52:29.000
 And we'll continue to see that over great pressure. Option two, sunset the rebate and send that over so Michael can invest more dollars in some of those cool programs that he was just talking about.

00:52:29.000 --> 00:52:35.000
 And on option three, it's option two with the addition of restructuring that that green rate.

00:52:35.000 --> 00:52:41.000
 So that's the only one of these options that really starts lowering that pressure that we're seeing on rates.

00:52:41.000 --> 00:52:51.000
 And just to put that into perspective, 24 FY 24, 25 and 26 were anticipating about a 12% increase to rates across those three years.

00:52:51.000 --> 00:52:58.000
 So this will have an immediate impact on trying to lighten that load that we're looking at and trying to deal with.

00:52:58.000 --> 00:53:01.000
 So, could I ask a question?

00:53:01.000 --> 00:53:02.000
 Yeah, go ahead.

00:53:02.000 --> 00:53:06.000
 I actually have to take off in a minute. I apologize everyone for being late.

00:53:06.000 --> 00:53:09.000
 So I wanted to ask, can you go back to the last slide?

00:53:09.000 --> 00:53:10.000
 Sure.

00:53:10.000 --> 00:53:16.000
 Like, my question is like, what's the biggest bang for the buck of all the programs that Michael mentioned?

00:53:16.000 --> 00:53:27.000
 And it's hard to know that like we can calculate that in dollar amounts, or it was brought up with what were the CO2 comparisons between those.

00:53:27.000 --> 00:53:36.000
 So I think with the CO2 comparisons, what that gives us is an idea about what would be the biggest bang for the buck of all of the various options and the different things.

00:53:36.000 --> 00:53:41.000
 Sure. Well, and he's going to do some deeper analysis on those programs.

00:53:41.000 --> 00:53:46.000
 But how we were measuring that CO2 reduction was purely from a kilowatt hour standpoint.

00:53:46.000 --> 00:53:54.000
 So a kilowatt hour reduction applied to the standard heat rate across the state of Texas is that CO2 reduction.

00:53:54.000 --> 00:53:58.000
 However, moving forward, everything that we're buying is renewable anyway.

00:53:58.000 --> 00:54:03.000
 So any CO2 reduction, I would argue, would probably be calculated that same way.

00:54:03.000 --> 00:54:06.000
 But it can be applied to the city as a whole.

00:54:06.000 --> 00:54:15.000
 So whatever that carbon footprint that the city has, these programs can start digging in and offsetting those carbon productions.

00:54:15.000 --> 00:54:16.000
 Does that make sense?

00:54:16.000 --> 00:54:26.000
 It does. But I think having some, you know, like just that simple question, well, what's the biggest bang for the buck? Like, what can we get the most back for these different programs?

00:54:26.000 --> 00:54:35.000
 Because even in my mind, I'm like, PV is still, you know, like better than some of these other programs, getting more of that.

00:54:35.000 --> 00:54:41.000
 It's a great question. It's, as a sustainability committee, it's the question you should ask, right?

00:54:41.000 --> 00:54:47.000
 And so here's the qualitative answer.

00:54:47.000 --> 00:54:59.000
 Since we're already 100 percent renewable on every kilowatt hour that's consumed in the city, the carbon footprint of your demand on the system is zero.

00:54:59.000 --> 00:55:08.000
 If you can reduce the kilowatt hours that are consumed qualitatively, that is the biggest bang for the buck.

00:55:08.000 --> 00:55:20.000
 And so when we talk about energy efficiency programs, HVAC programs, high efficiency appliances, weatherization, all these things, weatherization especially,

00:55:20.000 --> 00:55:25.000
 because think about it, how many homes in Denton are fueled by natural gas, fossil fuel, right?

00:55:25.000 --> 00:55:34.000
 If you can tighten that up and reduce the energy consumption, the BTUs that are used to heat or cool that space,

00:55:34.000 --> 00:55:39.000
 you're having the biggest bang for the buck in terms of a CO2 footprint.

00:55:39.000 --> 00:55:44.000
 So I think although we don't have the exact numbers and rank order then, right?

00:55:44.000 --> 00:55:56.000
 I think qualitatively, eliminating the demand is the most environmentally beneficial program that we could invest in.

00:55:56.000 --> 00:56:05.000
 You know, when you think about what is per ton, ton per kilowatt hour, yeah, we can probably calculate that for you.

00:56:05.000 --> 00:56:16.000
 But again, I think eliminating those, that demand in the first place is beneficial, more beneficial.

00:56:16.000 --> 00:56:28.000
 And you know, so that's where I would recommend you kind of think about this. Recommendation is we're taking money from a program

00:56:28.000 --> 00:56:33.000
 that's already achieved its goal, 100% renewable energy with zero carbon emissions.

00:56:33.000 --> 00:56:41.000
 And we're directing, we're recommending you redirect that money to programs that are going to improve efficiency, energy efficiency.

00:56:41.000 --> 00:56:43.000
 I hope that answers your question.

00:56:43.000 --> 00:56:50.000
 I have a couple of questions. For me, the solar completely takes the demand off of the system, right?

00:56:50.000 --> 00:56:56.000
 So if somebody's generating their own power, we're not using our system.

00:56:56.000 --> 00:57:04.000
 But I do want to ask about the 100% renewable. Are we still counting RECs or is it all physical energy now?

00:57:04.000 --> 00:57:11.000
 It is a combination. There's a small portion that is RECs from a legacy contract that we have.

00:57:11.000 --> 00:57:13.000
 I think you were involved in this discussion.

00:57:13.000 --> 00:57:21.000
 Because for me, the solar is 100% renewable. That is actual physical energy that we can, we can generate.

00:57:21.000 --> 00:57:31.000
 And some of that, and I don't know if we have the numbers, how much of that offsets the emissions from our local gas plant too.

00:57:31.000 --> 00:57:37.000
 So, you know, there's some, there's some emissions and offsets there that I would like to know more about.

00:57:37.000 --> 00:57:51.000
 Yeah, a couple of points. One, there is a thought process that if I install solar on my home, I'm having, I'm offsetting the emissions.

00:57:51.000 --> 00:57:57.000
 So why not increase the energy consumption in my home, right?

00:57:57.000 --> 00:58:08.000
 So there's some studies out there that show that for some homeowners, that's an issue. They turn their conditioning down from 68 to 65 in the summer

00:58:08.000 --> 00:58:18.000
 because they justify it by saying, "Hey, I'm producing my own clean energy." And that's an individual choice.

00:58:18.000 --> 00:58:31.000
 With respect to the, this rooftop solar's indents, 7.2 megawatts that we have today, we don't actually count any of those avoided emissions in our 100% renewable gold.

00:58:31.000 --> 00:58:47.000
 Because ERCOT has no way to allocate RECS, renewable energy credits, to those because they don't know what the actual generation is on a rooftop solar across the entire ERCOT footprint.

00:58:47.000 --> 00:58:56.000
 There's no way to meter right now. They don't mandate that. It would drive the cost up considerably. So we don't include that today.

00:58:56.000 --> 00:59:10.000
 The only RECS that we include are the ones that are verified by ERCOT that those megawatts, those kilowatt hours, came from a generator that is renewable, that had no emissions associated with it.

00:59:10.000 --> 00:59:21.000
 So we could get in a whole discussion about RECS. And we probably, as Tony said, we will when we come back with the Dent Renewable Resource Plan and how we think we could score that better.

00:59:21.000 --> 00:59:32.000
 Right. And thank you, thank you for that clarification. Do you, since you have to go, do you have direction you want to give?

00:59:32.000 --> 00:59:43.000
 Yeah, that was about it. I just have one more slide, too, for a while. Michael, again, I just had one thing to Max question.

00:59:43.000 --> 00:59:50.000
 So the biggest bang for the buck on money when you get to energy consumption, energy efficiency, there's going to be two things when you look at most buildings.

00:59:50.000 --> 01:00:00.000
 It's going to be your HVAC equipment, how that's run, the efficiency, the duct work, how it's all sealed, then it's the building envelope, which gets into your weatherization, your insulation, your windows, all of that.

01:00:00.000 --> 01:00:06.000
 When you combine those two things and do it correctly, that type you reduce the demand. And that's actually where we see this.

01:00:06.000 --> 01:00:19.000
 So what we're recommending coming out is to take part of the money that was being to incentivize solar and put that into making it be more available across the city to all users to do better things with every building.

01:00:19.000 --> 01:00:31.000
 So I understand that, and I appreciate the qualitative aspect of it. To me, it's more just, I think people want to see something that they can grasp, like a comparative.

01:00:31.000 --> 01:00:42.000
 So that's why I was saying, like, you can do dollars, you can do kilowatt hours, which is a really hard thing to understand. It's really hard to record now if you had around 40-50 kilowatt hours.

01:00:42.000 --> 01:00:48.000
 I mean, I'm sorry, I've tried to teach that for years. It's really hard to understand.

01:00:48.000 --> 01:00:58.000
 CO2 emissions, I think it's closer to like a dollar in terms of what that is. So that's, my point is more of a recommendation that if you can set those things up.

01:00:58.000 --> 01:01:07.000
 Though I appreciate the qualitative aspect, I totally appreciate that, and I think people hear that. I'm just saying, I think that sells it better.

01:01:07.000 --> 01:01:12.000
 I think that's my point.

01:01:12.000 --> 01:01:22.000
 I appreciate that comment on teaching kilowatt hours, and then when you talk about demand, then you ratchet it up that education curve. So you and I are on the same line there.

01:01:22.000 --> 01:01:26.000
 Last slide.

01:01:26.000 --> 01:01:31.000
 I think.

01:01:31.000 --> 01:01:43.000
 There we go. So the staff recommendation is option three, and that's the one that sunsets the solar rebate, sends those dollars over to green cents. It also restructures that net billing program.

01:01:43.000 --> 01:01:53.000
 So instead of paying a retail rate, we're paying more of an appropriate rate. In our case, it's the energy cost adjustment or that 3.4 cents.

01:01:53.000 --> 01:02:01.000
 And then our first year savings is anticipated to be about $700,000 with that if we're able to make those changes.

01:02:01.000 --> 01:02:07.000
 So with that, that concludes the presentation, and we'll take any more questions.

01:02:07.000 --> 01:02:15.000
 I do have one more question about 100% renewable, and I understand that's probably going to come back to us.

01:02:15.000 --> 01:02:31.000
 We take down so that we can see.

01:02:31.000 --> 01:02:34.000
 There he is.

01:02:34.000 --> 01:02:45.000
 Yeah, it's my understanding and it could be have changed, but each year it depends. And I remember seeing a chart where sometimes 100%. Sometimes we're not. Sometimes we are.

01:02:45.000 --> 01:02:57.000
 And I mean, it just it fluctuates. So there's not like 100% guarantee that we're at 100% each year as things come and go. And that might might be true.

01:02:57.000 --> 01:03:11.000
 I'm seeking clarification on that because if our main reason for us being 100% is trying to eliminate these programs, but we may not be in four years, like then that's a concern for me.

01:03:11.000 --> 01:03:29.000
 Yeah, you know, our mandate from the council is to be 100% every year. And so we procure contracts, power purchase agreements with renewable energy resources based upon a forecasted load that we're going to serve in the future.

01:03:29.000 --> 01:03:37.000
 So our goal is to always be 100%. Will we achieve it every year? Our goal is to do that.

01:03:37.000 --> 01:03:46.000
 We just went through a summer where we had very high electrical demand, about 20% higher than we thought we would have in the summer.

01:03:46.000 --> 01:04:07.000
 What does that mean? That means going forward, rather than being 101% renewable like we were in 2021, maybe we need to target 110% renewable to ensure that we've got enough carbon free emission generated kilowatt hours to serve.

01:04:07.000 --> 01:04:25.000
 What is a variable load? Any forecast that you've heard me say before, any forecast that I give you is going to be wrong, right? But we use a lot of science, a lot of math, a lot of statistics to try to make sure that we're getting as close to a realistic estimate as possible.

01:04:25.000 --> 01:04:41.000
 So, yeah, we do not plan in any year to not be 100% renewable. We will be 100% renewable, unless there's something that happens that doesn't enable us to do that.

01:04:41.000 --> 01:04:53.000
 For example, if we had a wind resource that we're under contract with, that the wind turbines got blown down during a hurricane or tornado, obviously they wouldn't be producing anything.

01:04:53.000 --> 01:05:12.000
 We'd have to go out and replace those kilowatt hours, either through a new contract, through a bilateral transaction with another entity, or by recs. And again, our goal is 100% renewable. I hope that answers your question.

01:05:12.000 --> 01:05:30.000
 Just one follow-up, and I'm going to let the committee talk, because just while you're on this. And so, can those extra generations from the localized solar fill in that 10% that you're saying, like, you know, to the grid that we're missing? Like, can that supplement?

01:05:30.000 --> 01:05:49.000
 I mean, if through the Dent Renewable Resource Plan revision that we bring to this committee and to the PUB and the council, they give us guidance that says, yes, you can count those emissions, those avoided emissions, then yeah, we can count those.

01:05:49.000 --> 01:06:05.000
 But we would, in the accounting for the year, we would have to forecast what we thought the rooftop solar were going to contribute to the total reduction. So, that variability is always going to be there.

01:06:05.000 --> 01:06:20.000
 You know, we don't typically go out and say, well, we're going to buy an option on an asset that could produce additional renewable energy credits and clean energy. We're going to pay somebody for the option, just in case we're going to need it.

01:06:20.000 --> 01:06:37.000
 That's something we have not done, and I wouldn't recommend it, because it would be very, very expensive. I'm just saying, in my head, that could offset, that could be physical renewable energy going into the grid that we haven't planned for that can help us maintain our 100% renewable.

01:06:37.000 --> 01:06:56.000
 Again, today, in the way that we, the metric that we use to determine the 100%, we do not give any credit to that. But certainly, we can think about it, and you know, if we see a proliferation of additional rooftop solar, yeah, I think it would be a good idea.

01:06:56.000 --> 01:07:08.000
 Okay, thank you. Ed? Adam? Anyone? Go ahead. I haven't forgotten about you, Mr. Stevens. I know you have questions.

01:07:08.000 --> 01:07:14.000
 Is this so clearly just so I'm clear? Is this a time where we can kind of weigh in about what we think about?

01:07:14.000 --> 01:07:19.000
 Yeah, is this a time, right? You're looking for direction or suggestions from us, from our community?

01:07:19.000 --> 01:07:21.000
 Sure. Any comments, thoughts, suggestions?

01:07:21.000 --> 01:07:38.000
 Adam, go ahead. So I have some, I want to just say some thoughts about the way I think about this and the way, Matt was talking about teaching, the way I teach this stuff, which is really complex, just to make sure you think I'm approaching this from a way that makes sense, right?

01:07:38.000 --> 01:07:57.000
 And then at the end of that, about a couple of recommendations/questions, I guess. So I always think what we're trying to do is accomplish three goals, reliability, rates, and renewables, I call them the three R's, right?

01:07:57.000 --> 01:08:10.000
 In this conversation, we're mostly talking about rates, and what's interesting is the goal of rates isn't just to have them low, but what I've learned through this conversation is to have them equitably distributed, right?

01:08:10.000 --> 01:08:24.000
 So we're trying to have rate equity accomplished, while also not sacrificing the other goals, right, of renewables and a reliable grid, right?

01:08:24.000 --> 01:08:38.000
 And as I see it here, there's, you know, look at your proposals. Within that, there's two issues. There's the rebates, which is the sort of initial install, and then there's the metering. So what do we do once it's operational?

01:08:38.000 --> 01:08:53.000
 Okay, so that's the way I'm thinking about this. Now on the rebates, I think it does make sense to sunset them, for the reasons you've talked about, because the feds are picking up more of the slack, it sounds like, and the market costs keep dropping.

01:08:53.000 --> 01:09:03.000
 And it seems like people are installing them, regardless of a rebate program. And if you think about this question, well, where do we get our most bang for the buck?

01:09:03.000 --> 01:09:17.000
 You can say, well, rooftop solar is a demand reduction strategy, but the only kind of thing you're reducing is the electrons that are already fossil free, right?

01:09:17.000 --> 01:09:32.000
 Whereas if we put rebate money into home weatherization programs, we're reducing BTU demand, which is often fossil generated. We were talking about, like, if you're heating your home, like I do with natural gas, I get better insulation.

01:09:32.000 --> 01:09:46.000
 Now we're really actually contributing more to 100% renewable goal that's our climate action plan, which is actually 100% not just in electricity, but across the building sector and everything. So that's the way I'm thinking about that.

01:09:46.000 --> 01:09:59.000
 On metering, I'm less clear, and I'm sensitive to, you know, this is really where the questions of equity for installed, who's already installed it, and all of that comes up with our first presentation.

01:09:59.000 --> 01:10:14.000
 But I'm just wondering, I have a couple questions. Isn't there a way, so one idea, this is probably really stupidly simplistic, if you could just say your bill, if you have a rooftop system,

01:10:14.000 --> 01:10:32.000
 will be $64 minimum, because that's your fixed cost per month, and then plus any other costs that you incurred above the net sort of feeding back into the system, right?

01:10:32.000 --> 01:10:54.000
 So that's, I don't know if that could work. Or could you say, you could have a net zero bill, right, if, and maybe you'd cap it there, if you sent enough electrons at the market rate back into the system to cover your fixed cost, right?

01:10:54.000 --> 01:11:06.000
 That is, if you sent enough to cover your demand, plus at market rate, not the rate you're paying, then it would cover your $64 fixed cost. Does that make sense?

01:11:06.000 --> 01:11:12.000
 I'm just trying to brainstorm, how can we structure equitable metering, you know, and billing structure?

01:11:12.000 --> 01:11:22.000
 Sure. First of all, the comments you made, Linden, up to that point, you're spot on. I mean, I think you hit all our points very well, or the points that we were trying to convey anyway.

01:11:22.000 --> 01:11:35.000
 Certainly, if we could recover that fixed cost component, I mean, you know, our work here is done, you know, we can all pack up and go, so that's the question here, and that's the one that we're trying to solve.

01:11:35.000 --> 01:11:47.000
 That's certainly an option, what you mentioned, having a minimum of $64, and then everything that happens above and beyond that is just sort of the ebb and flow of the electrons, which are not the big portion.

01:11:47.000 --> 01:12:04.000
 And then that final, I'm a little less clear on what you're thinking about for that final part, because that would take quite a few KWHs coming back to us, or flowing to the customer at that smaller rate.

01:12:04.000 --> 01:12:08.000
 I didn't say it very well, because I don't understand it.

01:12:08.000 --> 01:12:26.000
 I think I messed it up saying it. Couldn't you have a rate structure where if somebody's got a really big rooftop system, that they're essentially giving you well beyond what they're consuming, so they're net generating.

01:12:26.000 --> 01:12:45.000
 It's interesting, because they're like prosumers, right, they're production end consumers. So they're doing more production than consumption by a large amount, but those electrons are just free for y'all, and that amounts to enough to cover that fixed cost.

01:12:45.000 --> 01:12:55.000
 So those big systems could have a zero bill, and you can still cover your, because you're essentially getting free electrons to cover that.

01:12:55.000 --> 01:13:03.000
 Yeah. Well, the devil's in the detail. Rate making is definitely a bit of a science and a bit of an art. It's certainly something that we can look at.

01:13:03.000 --> 01:13:07.000
 That's how many kilowatt hours you'd have to sell back each month to make the $64.

01:13:07.000 --> 01:13:08.000
 Oh, okay. Thank you.

01:13:08.000 --> 01:13:09.000
 At the current market price.

01:13:09.000 --> 01:13:22.000
 So about 1,280 kilowatt hours a month would have to flow back to us. That's a pretty substantial amount. Maybe the commercial systems can come close to that, but then we're sort of talking about a different customer category altogether.

01:13:22.000 --> 01:13:33.000
 Okay, but you could say you don't cover all of that, but you start chipping away at that $64. So your bill could be lower than $64 if you're feeding free electrons.

01:13:33.000 --> 01:13:34.000
 Sure.

01:13:34.000 --> 01:13:44.000
 It's like you're paying, what's that called, when you pay, you don't pay in cash, in kind. It's like an in kind payment with electrons.

01:13:44.000 --> 01:13:50.000
 Yeah, that's certainly a different way to look at it. We can take a look at that.

01:13:50.000 --> 01:13:53.000
 Do you mind if I go to Mr. Stevens real quick?

01:13:53.000 --> 01:13:54.000
 For sure.

01:13:54.000 --> 01:14:01.000
 Mr. Stevens, do you have any questions or comments or anything on the options or non-options?

01:14:01.000 --> 01:14:03.000
 Yes, I do.

01:14:03.000 --> 01:14:09.000
 Can we turn that up, please? Hold on one second. We want to make sure we can hear you.

01:14:09.000 --> 01:14:14.000
 Okay. Testing. Testing. One, two, three, two, one.

01:14:14.000 --> 01:14:18.000
 That's better. Yeah, that's better. That's good. Thank you.

01:14:18.000 --> 01:14:22.000
 All right, very good. I have a ton of questions, I'm sure.

01:14:22.000 --> 01:14:27.000
 And I'm sorry, but gentlemen, I guess I'll probably form it up.

01:14:27.000 --> 01:14:43.000
 And a great question from an equity perspective. Some of the things that I'm missing in the presentation, if you would, what is the impact on the consumer, categorized consumer?

01:14:43.000 --> 01:14:59.000
 I would like to see information that those that are making those major contributions back into the system and costing the system, what is the percentage of customers that are actually in that category?

01:14:59.000 --> 01:15:16.000
 And I think about, when I talk about the toll roads, I know that I'm going to have to pay for my uses of that toll road. Can we laser focus this cost recovery that you need in order to offset your costs?

01:15:16.000 --> 01:15:41.000
 I need a little bit more understanding on how is it that if I'm giving energy and I don't have a solar system, I am a customer in a brand new home, I am considering going solar, I am looking at the new federal legislation, I'm looking at how we can get away from more fossil fuels and enter energy generation through wind and solar.

01:15:41.000 --> 01:15:49.000
 But it would sound like that I would be penalizing the system if I were to go solar penalizing myself to a certain degree.

01:15:49.000 --> 01:16:18.000
 And my concern is, can we identify the MEUs, the starship users, in a sense that, how DME is described, can we identify that percentage of the population? And can there be a building structure that would impact those rather than, as I've heard you say earlier, why would we want to impact the mass audience?

01:16:18.000 --> 01:16:36.000
 Where are the numbers, such as what Mr. Hazard presented, where are the consumer based numbers that I really need to see the impact on the consumer community, sexualized, cataparized, what is this going to put back to us?

01:16:36.000 --> 01:17:01.000
 We are here, yes, for sustainability of this community. That tells me that I am a target audience. That is both of the citizens of this community. So in addition to protecting their health through our involvement, our direction, I'm very concerned about the sustainability of the community from a cost perspective as well.

01:17:01.000 --> 01:17:12.000
 Why would the solar community be strapped with additional costs, additional expenses, to take it out and shift it to just a different pocket?

01:17:12.000 --> 01:17:32.000
 I understand weatherization and new windows and so forth, but for the new housing community, I don't need to look at that for the next 10 years. How can I participate in reducing our carbon emissions? That would be just some of the concerns that I have with regards to this presentation.

01:17:32.000 --> 01:17:45.000
 Thank you. I'll try to unpackage that a little bit before you, Member Stevens. First of all, you're not going to be penalized to put in a system. We're still going to interconnect systems.

01:17:45.000 --> 01:17:53.000
 Those are the utilities that I showed up on that comparison. They're seeing systems going into their service territories as well, even with that rate structure.

01:17:53.000 --> 01:18:02.000
 It just changes the economics that you're going to use personally, along with the tax credits, to justify your expense on that system.

01:18:02.000 --> 01:18:13.000
 So part of that is going to be economics. Part of that is just going to be your overall feeling and desire to be renewable as an individual and as a household.

01:18:13.000 --> 01:18:30.000
 So I don't look at it as a penalization, more so really correcting how we're billing moving forward. So in as far as your impact on the consumer, are you talking about the impact to the solar consumer or are you talking about the impact to the rest of the 61,000 customers?

01:18:30.000 --> 01:18:47.000
 I would actually like to suggest that you do a presentation or present information that would show us the impact to the expense, like your expense to the entire community, and then even sectionalize it down to just the solar community.

01:18:47.000 --> 01:18:59.000
 So are we talking about just solar impact to DMV's cost system or are we talking about there going to be impact across the 61,000 consumers?

01:18:59.000 --> 01:19:08.000
 Well, that's a great question, and right now there's already impact to the rest of the customers that aren't solar, and that's the part that we're trying to correct.

01:19:08.000 --> 01:19:14.000
 One, by removing that rebate. Two, by restructuring that net metering.

01:19:14.000 --> 01:19:26.000
 And the third thing is the part that is going to be hard for us to capture or correct, and that's the offset of electrons that we would originally sell to a customer.

01:19:26.000 --> 01:19:31.000
 If they're generating their own, we're no longer seeing those sales, so it's a lost opportunity for us.

01:19:31.000 --> 01:19:42.000
 And when you add those three categories together, we're already at a level of $1.5 million a year, and that's going to go up exponentially like that curve that I showed you.

01:19:42.000 --> 01:19:49.000
 But we're already at a $1.5 million a year that's providing that 1% pressure on the rest of our customers.

01:19:49.000 --> 01:19:58.000
 Now, if you're looking at it from a solar standpoint, yes, their economics will change a little bit on their systems that they've already installed.

01:19:58.000 --> 01:20:06.000
 However, they're still going to offset those kilowatt hours that they would have otherwise purchased from us at full retail.

01:20:06.000 --> 01:20:10.000
 So that economic piece is still going to be in their equation.

01:20:10.000 --> 01:20:16.000
 It's just it may extend their original thought of when they were going to pay that system off.

01:20:16.000 --> 01:20:20.000
 Does that make sense?

01:20:46.000 --> 01:20:56.000
 So are we talking about just the fact that there's a lot of retail potential because of the growth of solar?

01:20:56.000 --> 01:21:02.000
 Or are we actually talking about real savings to the community, to the consumer themselves?

01:21:02.000 --> 01:21:05.000
 No, it's real savings to the community.

01:21:05.000 --> 01:21:13.000
 It is real savings to the community because right now, the folks that don't have solar are, in fact, subsidizing the ones that do.

01:21:13.000 --> 01:21:16.000
 So we're trying to correct that cross-subsidy.

01:21:16.000 --> 01:21:19.000
 And this is one step closer to doing that.

01:21:19.000 --> 01:21:21.000
 So I'll finish with that.

01:21:21.000 --> 01:21:27.000
 That's where I would like to see what savings would be added to the consumer base.

01:21:27.000 --> 01:21:33.000
 I don't see the consumer represented in this conversation at all.

01:21:33.000 --> 01:21:46.000
 This conversation, with the exception of what Mr. Adams just presented, what I do not know is whether I'd be moving, you know, would he be moving? Would he add? But this is the only part of the conversation that has any impact on the consumer.

01:21:46.000 --> 01:21:49.000
 So thank you very much.

01:21:49.000 --> 01:21:50.000
 Thank you.

01:21:50.000 --> 01:21:51.000
 Brian?

01:21:51.000 --> 01:21:58.000
 Yeah, so I'm going to concur with kind of Adam's thought because based off of our framework and one of our guiding principles,

01:21:58.000 --> 01:22:04.000
 it is to maintain a diversified power portfolio under the way we review energy generation.

01:22:04.000 --> 01:22:15.000
 I just conceptually kind of hate the idea of penalizing these early adopters that for a decade we've encouraged them to build these systems and a lot of those systems finances out, you know, 20 years.

01:22:15.000 --> 01:22:21.000
 And so they're now fixed in this cost that they may have adopted a decade ago.

01:22:21.000 --> 01:22:24.000
 And we're kind of going to flip the switch on them.

01:22:24.000 --> 01:22:34.000
 I would hope we could find a way to structure this to where it doesn't hurt the folks that did the thing that we asked them to do, but also make sure that it's equitable going forward.

01:22:34.000 --> 01:22:45.000
 And that the way that we develop this future rate structure enables folks who are generating local power to pay back into the system up to the point where we're not subsidizing their bill.

01:22:45.000 --> 01:22:54.000
 So if they get to a net zero, including with your facilities fees, and no further, the rest of those electrons just go to D&E for free.

01:22:54.000 --> 01:23:10.000
 I would think that would be a more ideal scenario than somehow building that out to where they're paying more than the standard user might.

01:23:10.000 --> 01:23:18.000
 Yeah, I concur with my fellow member on what he just said.

01:23:18.000 --> 01:23:22.000
 Just some really broad things here.

01:23:22.000 --> 01:23:26.000
 I really appreciate the complexity of this.

01:23:26.000 --> 01:23:41.000
 And I really appreciate your expertise in trying to solve this in a positive, beneficial way.

01:23:41.000 --> 01:23:59.000
 I don't want to in any way discourage PV installation. And that to me is the biggest concern, especially installations in lower income neighborhoods.

01:23:59.000 --> 01:24:18.000
 And I know that the idea that it's these lower income neighborhoods to some degree that are subsidizing other people's solar installations.

01:24:18.000 --> 01:24:41.000
 I don't really, I don't see that. What I do see is the need to make solar available to those people, to those neighborhoods, by continuing some form of a rebate program.

01:24:41.000 --> 01:24:59.000
 And I thought even a rebate program that could be incrementally reduced as the market price gets cheaper and cheaper, as prices fall, there could be a sliding scale in that respect.

01:24:59.000 --> 01:25:12.000
 Again, there's the issue of people who have already spent their money and are continuing to pay for their systems, having the rug sort of pulled out from underneath their feet.

01:25:12.000 --> 01:25:19.000
 I think that really needs to be looked at closely in a more equitable approach found.

01:25:19.000 --> 01:25:32.000
 The first DME-permitted solar installation was put in 17 years ago. And it's amazing to see what's happened in 17 years. It's incredible.

01:25:32.000 --> 01:25:39.000
 And because of what's happening climate-wise, it's going to have to happen even faster.

01:25:39.000 --> 01:25:51.000
 And I think that we must also look at the big picture here. Denton's part of a big organism, or just one part of it.

01:25:51.000 --> 01:26:02.000
 And we need to think about what we can do in the big picture too. And we're doing that to a certain degree.

01:26:02.000 --> 01:26:24.000
 We are getting 100% renewable from RECs. And the interesting thing is that the people who are putting power back into the grid are basically giving you or providing RECs in another form.

01:26:24.000 --> 01:26:32.000
 And in a way being paid for, if that makes sense.

01:26:32.000 --> 01:26:54.000
 And the point of this is that when that renewable energy that homes generate that they don't use, that they put back into the grid, they are continuing the greening of the grid.

01:26:54.000 --> 01:27:07.000
 Right now, as of the first quarter of 2022, 34% of the grid's energy is generated by wind and solar.

01:27:07.000 --> 01:27:15.000
 Solar alone is only 4.9% at this point.

01:27:15.000 --> 01:27:43.000
 So the more we can do to increase those numbers, I think it's something that should be promoted by having some form of rebate still in effect for people who want to put in solar installations.

01:27:43.000 --> 01:27:52.000
 But I think that we're not going to be on where we need to be until the grid is 100% renewable energy.

01:27:52.000 --> 01:28:01.000
 And it's going to be. You know better than I what's coming down the highway. Batteries becoming more economical and all.

01:28:01.000 --> 01:28:13.000
 And frankly, it's just amazing. It amazes me how quickly the tide has turned and continues to turn.

01:28:13.000 --> 01:28:22.000
 And the more we can do to enhance that shift, I think is very important.

01:28:22.000 --> 01:28:37.000
 And I don't see removing this current rebate program in its current removing it without serious discussion of how it can still be implemented in some way

01:28:37.000 --> 01:28:46.000
 so that there's equity involved in allowing people to have the opportunity to put solar on their homes.

01:28:46.000 --> 01:29:00.000
 And equity involved in not pulling the rug out, as I said, for the people who are still paying for their, who got to install their solar systems

01:29:00.000 --> 01:29:10.000
 knowing that they were going to have, that the payback of that system was going to be helped by a net metering.

01:29:10.000 --> 01:29:19.000
 I just don't see how that can be done in a way that's going to make people feel great, feel wow, that's wonderful.

01:29:19.000 --> 01:29:26.000
 I'm glad you're doing that. So those are just some observations. Thanks.

01:29:26.000 --> 01:29:41.000
 I have, I have a few comments and some questions and you have to forgive me. I've got everything scattered. So one, I want to ask if this will affect our SolSmart designation?

01:29:41.000 --> 01:29:53.000
 If we stop giving out rebates? Okay. Well, I'm actually not in favor of getting rid of the rebates and I'd like to look beyond the three options.

01:29:53.000 --> 01:30:02.000
 I feel like there's something there that we could do with maybe reducing the rebate or spreading it out further.

01:30:02.000 --> 01:30:10.000
 I feel like there's some things, some finagling we could do with the rate structure that, you know, would be a little bit more fair.

01:30:10.000 --> 01:30:25.000
 But we talk about equity and we heard our speaker say is that there are a lot of individuals who can actually get credit to financing to afford systems.

01:30:25.000 --> 01:30:33.000
 The way we structure our rebates is you have to, and correct me if I'm wrong, make the investment upfront.

01:30:33.000 --> 01:30:43.000
 And for a lot of these that we have proposed, there's not financing available, maybe for Windows, maybe not, but they use a different structure.

01:30:43.000 --> 01:30:55.000
 And so somebody who may be wanting to get a rebate on Windows is going to have to pay a 20% interest rate so that they can get that receipt to get a municipal rebate from us.

01:30:55.000 --> 01:31:03.000
 So I don't know that that's equitable. With a solar system, they can do that and it's a little bit different.

01:31:03.000 --> 01:31:13.000
 As far as like HVAC or any kind of other system, you have to have that $1,000, $12,000, I think, even upfront and then show a receipt.

01:31:13.000 --> 01:31:19.000
 And I don't know how that is adding equity into our rebate system, as you suggest.

01:31:19.000 --> 01:31:26.000
 And that's just something, if I could be wrong on how that's handled, but I think that's what we used to do.

01:31:26.000 --> 01:31:36.000
 I feel like we're leaving out the whole economic development aspect of having rebates for solar on our commercial buildings.

01:31:36.000 --> 01:31:49.000
 I do know that when I was on that committee, we have that as an item to attract businesses to our community, that they look for those things.

01:31:49.000 --> 01:31:59.000
 And so to get rid of that, I think would be a little bit harmful on that aspect when we're looking to get businesses to our city.

01:31:59.000 --> 01:32:17.000
 I wonder if we can, let me see, and do we have to pay wholesale, at least minimal wholesale, to someone who is providing energy to the grid?

01:32:17.000 --> 01:32:24.000
 Like say, I think Mr. Hazard said, don't pay us at all, you know, just take that energy and then use it.

01:32:24.000 --> 01:32:34.000
 Are we required by state or law or some things maybe to pay at least wholesale for those?

01:32:34.000 --> 01:32:41.000
 I'll default that to the attorney, but there are utilities, as Mr. Hazard said, that are doing just that.

01:32:41.000 --> 01:32:44.000
 It's part of the agreement upfront, the interconnection agreement.

01:32:44.000 --> 01:32:48.000
 Anything that flows beyond the customer's usage is sort of a gift.

01:32:48.000 --> 01:32:58.000
 So I mean, I would like to look at what that would look like if we just did wholesale rather than retail, how that affects the chart that we saw.

01:32:58.000 --> 01:33:06.000
 And on the chart, I would like to know how many kilowatts we're estimating each year as that chart goes up.

01:33:06.000 --> 01:33:15.000
 It's actually embedded, so if you hover over it, it'll show you the amount of kilowatt hours that that's indicating.

01:33:15.000 --> 01:33:25.000
 So and then I know we're getting a lot of data centers, which is going to increase our demand load.

01:33:25.000 --> 01:33:31.000
 And as those come on, we're going to have to produce a lot more energy.

01:33:31.000 --> 01:33:40.000
 And so having more actual solar generation locally may be useful.

01:33:40.000 --> 01:33:46.000
 And the other thing is that with climate change, as Mr. Sof recommended, and weather extremes,

01:33:46.000 --> 01:33:53.000
 that's another reason why people want to get these systems put in now that batteries are available.

01:33:53.000 --> 01:33:58.000
 And so I don't want to take away that ability for them to do.

01:33:58.000 --> 01:34:07.000
 And I know we have federal credits coming down, but I also think that if we could do not get rid of that rebate program,

01:34:07.000 --> 01:34:13.000
 but maybe lessen it or spread it out or put restrictions on the size of systems,

01:34:13.000 --> 01:34:22.000
 say per square feet to make it more fair and equitable so we don't have, you know, a smaller house, just like an oversized system.

01:34:22.000 --> 01:34:28.000
 There are certain things that we can require of the consumer before they get the rebate.

01:34:28.000 --> 01:34:37.000
 Just throwing it out completely, I'm not in favor of.

01:34:37.000 --> 01:34:48.000
 So yeah, just the COSO, restricting the size, maybe reducing the incentive.

01:34:48.000 --> 01:34:53.000
 Yeah, those are some of my suggestions.

01:34:53.000 --> 01:34:54.000
 I have one more thing.

01:34:54.000 --> 01:34:55.000
 Okay.

01:34:55.000 --> 01:35:07.000
 At some point, I'd appreciate a discussion about the possibilities of community solar installations.

01:35:07.000 --> 01:35:11.000
 Thanks.

01:35:11.000 --> 01:35:15.000
 Great questions and discussions, excellent.

01:35:15.000 --> 01:35:21.000
 But I want to address just a couple of specific questions that I heard there.

01:35:21.000 --> 01:35:26.000
 The wholesale reimbursement of energy that we buy from the customer.

01:35:26.000 --> 01:35:36.000
 There's no requirement under the law that I'm aware of that would require us to pay that customer the wholesale price.

01:35:36.000 --> 01:35:42.000
 As everything is in this business, it's highly technical and complicated, right?

01:35:42.000 --> 01:35:52.000
 If your solar panels are producing surplus energy at 9 o'clock in the morning because your air conditioning load is lower

01:35:52.000 --> 01:36:01.000
 and your system's generating at peak output and I'm buying that energy from you at the wholesale rate.

01:36:01.000 --> 01:36:08.000
 The wholesale rate at 9 o'clock in the morning is not the same as the wholesale rate at 5 p.m.

01:36:08.000 --> 01:36:15.000
 It's considerably less, much less.

01:36:15.000 --> 01:36:26.000
 And we don't have the technology to be able to price that wholesale energy at that spot wholesale price.

01:36:26.000 --> 01:36:28.000
 DME is not equipped to do that.

01:36:28.000 --> 01:36:31.000
 It would be a very large investment for us to be able to do that.

01:36:31.000 --> 01:36:35.000
 It would be like real-time pricing of energy.

01:36:35.000 --> 01:36:38.000
 We don't offer that currently to any customers.

01:36:38.000 --> 01:36:50.000
 We'd love to get there, but it's going to require a significant capital investment in metering systems and data management.

01:36:50.000 --> 01:36:55.000
 Ten years from now, we'll probably be there, but we're not there today.

01:36:55.000 --> 01:37:05.000
 I just want to go back to the kind of broader question, the policy question, which is, you know, today, from an equity perspective,

01:37:05.000 --> 01:37:19.000
 we have 61,000 customers who are paying 842 customers for those fixed costs that we cannot recover.

01:37:19.000 --> 01:37:25.000
 The policy question for you is really, do you want to continue that inequity?

01:37:25.000 --> 01:37:27.000
 I call it an inequity.

01:37:27.000 --> 01:37:29.000
 It's a policy question.

01:37:29.000 --> 01:37:38.000
 It's pure policy that we're going to give you the numbers, and we're looking at the economics for the benefit of all ratepayers,

01:37:38.000 --> 01:37:42.000
 not just the ratepayers that have made the decision to install.

01:37:42.000 --> 01:37:53.000
 And I get the issues of, hey, I made a bargain with you based upon a program that was in place five years ago, and now you're changing it.

01:37:53.000 --> 01:37:55.000
 It happens all the time, right?

01:37:55.000 --> 01:38:00.000
 When you buy a stock in the stock market, you're not guaranteed a price.

01:38:00.000 --> 01:38:12.000
 When you attach your home to the DME system, whether you have a solar panel or not, we're not guaranteeing you a price for the next 20 years.

01:38:12.000 --> 01:38:14.000
 It's going to vary.

01:38:14.000 --> 01:38:22.000
 I can't go buy electricity in the wholesale market at a fixed price for the next 20 years without paying a huge premium.

01:38:22.000 --> 01:38:25.000
 So really, there's no right answer on this.

01:38:25.000 --> 01:38:33.000
 This is why we brought it to you, is because it's a policy issue that you as a committee have got to provide a recommendation to us.

01:38:33.000 --> 01:38:46.000
 We're just providing you with the facts about what we think is the most equitable way to deal with it on a per-customer basis, all customers.

01:38:46.000 --> 01:38:54.000
 And I'm not trying to lecture or preach or anything, but I just want to make sure that we're not telling you that your only option is

01:38:54.000 --> 01:38:56.000
 you've got to do what we're recommending.

01:38:56.000 --> 01:39:03.000
 No, it's a policy decision that this committee and the PUB and council is going to have to make.

01:39:03.000 --> 01:39:04.000
 Right. I appreciate that.

01:39:04.000 --> 01:39:11.000
 This committee is for sustainability framework, and we have a framework that we abide by in goals and things that we set.

01:39:11.000 --> 01:39:16.000
 So we're looking at it in a different way than your other two committees will.

01:39:16.000 --> 01:39:21.000
 And so I appreciate you bringing it to this committee to hear our side.

01:39:21.000 --> 01:39:26.000
 And I've written down every comment that you all made.

01:39:26.000 --> 01:39:29.000
 So we want to make sure that we go back and address those.

01:39:29.000 --> 01:39:34.000
 So have you thought about increasing the connection fee?

01:39:34.000 --> 01:39:44.000
 What I'm hearing is that it's the net metering, it's the money that you have to pay, or increase the fixed cost on the bills of those with solar.

01:39:44.000 --> 01:39:50.000
 I feel like there's a way to fix it without just getting rid of everything.

01:39:50.000 --> 01:39:55.000
 So I don't know if you've run numbers on that, what that would look like,

01:39:55.000 --> 01:40:00.000
 or what the connection fee increase would be to help compensate for that.

01:40:00.000 --> 01:40:06.000
 So a connection fee, just to be clear, I want to make sure, Bill, that we're speaking the same language.

01:40:06.000 --> 01:40:11.000
 A connection fee, when you say that, is that a one-time charge or is that a recurring monthly charge?

01:40:11.000 --> 01:40:16.000
 Well, it would be a one-time charge to connect the solar to the DME system.

01:40:16.000 --> 01:40:21.000
 So I don't know what that is currently because I'm not a solar customer.

01:40:21.000 --> 01:40:26.000
 Or maybe it is, and then the fixed rate would be a monthly charge.

01:40:26.000 --> 01:40:29.000
 So, you know, to cover the...

01:40:29.000 --> 01:40:41.000
 I mean, again, from a pure equity perspective, the best system we could put in place would be to charge every solar customer $62 a month fixed cost.

01:40:41.000 --> 01:40:48.000
 And then whatever you can offset by your own self-generation, you're avoiding our full rate, right?

01:40:48.000 --> 01:40:54.000
 And then the surplus that you generate that we would pay, we'd pay the wholesale price for.

01:40:54.000 --> 01:40:57.000
 That would be the most equitable way that we could do things.

01:40:57.000 --> 01:41:04.000
 However, that's a big $62. Our current rate is, what, $8 and $8.67.

01:41:04.000 --> 01:41:06.000
 So that's a big jump.

01:41:06.000 --> 01:41:13.000
 Now, granted, we could structure it so it only applies to the solar PV customers.

01:41:13.000 --> 01:41:19.000
 But, you know, I'm not aware that anybody's charging that type of a structure at this point.

01:41:19.000 --> 01:41:25.000
 Yeah, there's a couple of utilities that charge that added rate for the facility cost.

01:41:25.000 --> 01:41:31.000
 And I think to the answer to your question, there's several different ways to slice the Apple rate.

01:41:31.000 --> 01:41:35.000
 The rate structure that we were talking about is one way of addressing it.

01:41:35.000 --> 01:41:41.000
 Talking about loading some of those costs into the facility charge is another way to recover those costs.

01:41:41.000 --> 01:41:51.000
 So, I mean, that's the top note I have here is flesh out these rates a little bit more to see if there's something that's a little bit more palatable to all the groups.

01:41:51.000 --> 01:41:57.000
 Because you're just one of three that we're going to have to, you know, go forward with and talk about the information.

01:41:57.000 --> 01:42:05.000
 So, yeah. So, Madam Chair and community members, I think, kind of hearing different kind of thoughts here.

01:42:05.000 --> 01:42:13.000
 And as I mentioned earlier on, I mean, at this point, from my standpoint, there's not a big rush, right, to get a decision today.

01:42:13.000 --> 01:42:17.000
 I'm hearing one community member is asking for some additional information.

01:42:17.000 --> 01:42:21.000
 Ms. Briggs, you've asked for, hey, what other options are out there?

01:42:21.000 --> 01:42:26.000
 I think what would make sense from my standpoint is let us go back, let us look at your questions.

01:42:26.000 --> 01:42:37.000
 We'll provide a response. We'll come back to the committee to try to give some context to some of those questions and, you know, what other possible rate structure we could have.

01:42:37.000 --> 01:42:42.000
 And then we can bring that back to the committee. I think you guys meet at the end of the next month.

01:42:42.000 --> 01:42:45.000
 And then we can have this conversation again.

01:42:45.000 --> 01:42:54.000
 I think ultimately what we would like is a consensus recommendation from the committee that we can then eventually take forward to the council in whatever form you would like that to be.

01:42:54.000 --> 01:43:00.000
 But it doesn't sound like we're quite there yet. So we're happy to do that. So that would be okay with you and the rest of the committee.

01:43:00.000 --> 01:43:18.000
 Yeah, I think there's a lot of questions that we need to answer a little bit more. I don't feel like we're at consensus, mostly, except for that we just want to hear more information, basically, and that we want to provide, you know, equity and fairness.

01:43:18.000 --> 01:43:27.000
 I think there may have been a couple that were okay with getting the rebates and then some that weren't. So there's not consensus there yet.

01:43:27.000 --> 01:43:28.000
 Adam?

01:43:28.000 --> 01:43:40.000
 I agree. One thing that might be helpful is really helpful. In one of your slides you took, let's take a paradigmatic house and how much their bill would be in different cities.

01:43:40.000 --> 01:43:54.000
 If you all could work that, something like that up within Denton, what would a rate look like for somebody with a solar system with this rate structure versus that rate structure?

01:43:54.000 --> 01:44:15.000
 That would help me a lot to think through. I think we're all on board with equity. There's different understandings of equity, though. If we could look at comparisons, because I don't quite understand what this ECA is and how that would actually map out onto somebody's monthly bill.

01:44:15.000 --> 01:44:20.000
 That might help. I don't know.

01:44:20.000 --> 01:44:35.000
 I'd be curious to know if there are any other municipally owned companies that have faced this same problem. And if so, how they have solved it or not solved it.

01:44:35.000 --> 01:44:54.000
 I know there's a big confrontation in California over it, but I think it's called Net 3. I think that's still up in the air. But I've found state situations where they've tried to change this policy.

01:44:54.000 --> 01:45:10.000
 But I couldn't find any municipalities that have been grappling with the same problem. And I don't know if that would be a problem because of our 100% power that we've got now.

01:45:10.000 --> 01:45:20.000
 But in any case, have there been any other instances similar to or equal to what we're dealing with now?

01:45:20.000 --> 01:45:30.000
 I want to thank you for your time today and bringing this to our committee. We really appreciate it that you thought about us.

01:45:30.000 --> 01:45:57.000
 Madam Chair, can I just summarize what we heard to make sure we're all going off in the same direction? So the recap, I'm seeing a little bit more work with the rates impacts to customers more specifically than we showed Member Stevens. I apologize that we didn't get too granular with that $700,000. But that is a direct rate savings impact to customers. But we'll flesh that out a little bit more.

01:45:57.000 --> 01:46:13.000
 Let's see. I don't want to discourage solar in the community. And this certainly is not going to discourage. What it's going to do is just more level of scale as to what we're paying already. So anybody can look at that as discouragement.

01:46:13.000 --> 01:46:36.000
 But we look at it as just sort of even enough to tie a little bit. We'll talk a little bit more about that. Maybe a low income focus on some solutions. Business impact, what it's going to do to businesses. I can tell you that at least one of the businesses that we did, we entered into a PPA with their generation from their system. And that was lucrative for them.

01:46:36.000 --> 01:46:54.000
 It is much, much, much less than we're paying for the renewables now. But they were pleased with that PPA. And that comes into play when we have a large system that has a potential large impact to our system.

01:46:54.000 --> 01:47:12.000
 I think Terry already addressed the legality of energy coming back to us. Looking at it from a size-based rebate. We already have a little bit of that in there, but I like your thought, Madam Chair, on capping that size for a more appropriate size for a house.

01:47:12.000 --> 01:47:30.000
 Rate compared internally. Member Grable will certainly look at that and show you some options on a matrix. And then the last thing I have is what other munis have done. And Member Sothe, you're absolutely right. We're on a different platform than those other munis.

01:47:30.000 --> 01:47:47.000
 There's not a handful of munis in this country that can make the claim that we're making right now. And we should celebrate that. We should be proud of the fact that we're 100% renewable. When I was doing some research last night and before I wanted to make that statement broadly that says,

01:47:47.000 --> 01:48:04.000
 "Hey, everybody on this list, none of them is 100% renewable." I was like, "Well, I know Austin really fools with it a little bit." Austin wasn't even 50% renewable. So, I mean, that is huge. That's a huge accomplishment that we really need to celebrate, really take to heart.

01:48:04.000 --> 01:48:25.000
 And to me, that puts us on a different platform when we're looking to incentivize customers to do these things. We've already done it for them. So, but yeah, we'll talk a little bit more about that. And that was really what I wanted you all to go home with is the fact that, you know, we're doing a great job being 100% renewable now. We should be proud of that.

01:48:25.000 --> 01:48:49.000
 And also to add to your list, to look at maybe reducing the rebate so that it can spread out further. And right, I do want to make the comment that, you know, our speaker said that we do not have a choice that this is, you know, our utility. But in Russia, it is our utility, right? It's DME. It's locally on.

01:48:49.000 --> 01:49:05.000
 So, it's up to us and we can, you know, make it what we want and we're 100%. So, we get to have these conversations and a lot of others don't. So, you know, that's what's really great. We don't want to lose sight of that.

01:49:05.000 --> 01:49:06.000
 Right.

01:49:06.000 --> 01:49:08.000
 Yeah. So, thank you.

01:49:08.000 --> 01:49:09.000
 Thanks for hearing us.

01:49:09.000 --> 01:49:24.000
 Yep. All right. We have concluded that item and we do have concluding items. Does anybody have anything they want to add today? No.

01:49:24.000 --> 01:49:39.000
 All right. So, we will in the meeting at 1102. Thank you. Thank you, Mr. Stevens. It's good to see you.