WEBVTT 00:00:00.000 --> 00:00:07.020 Good morning and welcome to the regularly scheduled Public Utilities Board meeting. 00:00:07.020 --> 00:00:12.340 It is September 29th at 9 a.m. and the meeting is called to order. 00:00:12.340 --> 00:00:16.240 Do we have any presentations from the public? 00:00:16.240 --> 00:00:19.100 Seeing none we'll move on to the consent agenda. 00:00:19.100 --> 00:00:27.560 We need to pull items M and N to discuss and close session. 00:00:27.560 --> 00:00:30.120 Does anybody have any other items they wish to pull? 00:00:30.120 --> 00:00:33.120 I have a question. 00:00:33.120 --> 00:00:39.440 I had requested some further information from the Director of Water and Wastewater about 00:00:39.440 --> 00:00:43.960 items B through H because there were so many chemicals and didn't clarify which chemical 00:00:43.960 --> 00:00:47.900 was for which process and I don't know if other members of the board would like to see 00:00:47.900 --> 00:00:51.280 that before we vote on those things. 00:00:51.280 --> 00:00:52.280 We sent them to everyone. 00:00:52.280 --> 00:00:53.800 Oh you did send it out to everyone? 00:00:53.800 --> 00:00:54.800 Yes sir, I emailed it to everyone. 00:00:54.800 --> 00:00:55.800 Okay. 00:00:55.800 --> 00:00:56.800 Yes sir. 00:00:56.800 --> 00:00:57.800 But thank you very much. 00:00:57.800 --> 00:01:06.060 Would anybody like to discuss the chemicals or is everybody good with the email we received? 00:01:06.060 --> 00:01:09.720 If no one has an interest in it I will not ask to pull them from the consent agenda but 00:01:09.720 --> 00:01:15.520 I thought I'd give everybody the chance if they wanted to have a look at that. 00:01:15.520 --> 00:01:16.520 Thank you. 00:01:16.520 --> 00:01:23.520 Okay seeing, I think everybody got the email this weekend so with that I'll consider approval 00:01:23.520 --> 00:01:28.200 of items A, a motion for approval for items A through L. 00:01:28.200 --> 00:01:29.800 So moved. 00:01:29.800 --> 00:01:30.800 Second. 00:01:30.800 --> 00:01:32.440 All in favor say aye. 00:01:32.440 --> 00:01:33.440 Aye. 00:01:33.440 --> 00:01:38.320 Motion carries unanimously. 00:01:38.320 --> 00:01:42.640 Now moving on to our items for individual consideration. 00:01:42.640 --> 00:01:48.520 First item for individual consideration is approval of the September 15th minutes. 00:01:48.520 --> 00:01:54.280 We have a motion and a second. 00:01:54.280 --> 00:01:57.720 That was, Lee was the second on that. 00:01:57.720 --> 00:01:58.720 All in favor say aye. 00:01:58.720 --> 00:01:59.720 Aye. 00:01:59.720 --> 00:02:01.560 Any opposed? 00:02:01.560 --> 00:02:03.860 Motion carries unanimously. 00:02:03.860 --> 00:02:17.200 We are also going into closed session to discuss items B and C. So I guess we will start with 00:02:17.200 --> 00:02:22.640 item D. Consider recommending approval of resolution for City of Denton for the City 00:02:22.640 --> 00:02:48.360 of Denton Water Master Plan. 00:02:48.360 --> 00:02:53.080 So good morning, I'm Kyle Pedigo, Planning and Engineering Division Manager for Water 00:02:53.080 --> 00:02:54.080 Utilities. 00:02:54.080 --> 00:02:58.960 I'm here today to present our update to the Water Master Plan. 00:02:58.960 --> 00:03:03.200 The current Water Master Plan was adopted in December 2018 and was used as a planning 00:03:03.200 --> 00:03:05.680 tool for the Water Utilities Department. 00:03:05.680 --> 00:03:10.520 The Water Master Plan projects growth and identifies water infrastructure that is needed 00:03:10.520 --> 00:03:17.400 to support that growth through the 5, 10 and 25 year development windows. 00:03:17.400 --> 00:03:21.920 The Water Master Plan is updated regularly out of necessity when the prior Water Master 00:03:21.920 --> 00:03:30.780 Plan no longer, is no longer accurate with what the city is seeing in growth and projected 00:03:30.780 --> 00:03:32.000 infrastructure needs. 00:03:32.000 --> 00:03:37.760 The 2018 Water Master Plan estimated lower growth in the outer regions and higher growth 00:03:37.760 --> 00:03:42.520 in the infill, which is not accurate when compared to the growth trends that we've observed 00:03:42.520 --> 00:03:46.080 over the last seven years. 00:03:46.080 --> 00:03:50.600 The objective of the Water Master Plan update is to address the imbalance growth trends 00:03:50.600 --> 00:03:53.280 seen from the 2018 Water Master Plan. 00:03:53.280 --> 00:03:58.840 This imbalance is driving the need for additional treatments, treatment and conveyance infrastructure 00:03:58.840 --> 00:04:02.080 that wasn't contemplated in 2018. 00:04:02.080 --> 00:04:06.720 The current overall growth rate has exceeded projections in the western and northern parts 00:04:06.720 --> 00:04:14.560 of the city, driven primarily by industrial land use initiatives south of US 380 and west 00:04:14.560 --> 00:04:22.000 of I-35, as well as the hunter and coal developments in the west. 00:04:22.000 --> 00:04:27.880 This heat map shows the change in the growth trend between the projections in the 2018 00:04:27.880 --> 00:04:31.500 Master Plan and the observed rates over the past seven years. 00:04:31.500 --> 00:04:37.240 The map is color coded where red represents areas where the growth has far exceeded the 00:04:37.240 --> 00:04:45.360 2018 projections and blue represents areas where the growth is lower than the 2018 projections. 00:04:45.360 --> 00:04:51.840 As you can see, the high growth area is concentrated around the perimeter of the city, while infill, 00:04:51.840 --> 00:05:02.000 which is the expansion of the mostly developed core, has slowed. 00:05:02.000 --> 00:05:06.400 The three growth charts shown here compare the observed population growth, which is the 00:05:06.400 --> 00:05:12.000 solid line, in each service area to the projections from the 2018 Water Master Plan. 00:05:12.000 --> 00:05:17.960 In Service Area 1A, we've seen a 65% reduction compared to the projection. 00:05:17.960 --> 00:05:24.000 In Service Area 1B, we've seen a 185% increase from the projection. 00:05:24.000 --> 00:05:26.960 And in Service Area 2, go ahead. 00:05:26.960 --> 00:05:28.080 I just have a question. 00:05:28.080 --> 00:05:36.040 These service areas, are they based on the current water production facilities and their 00:05:36.040 --> 00:05:41.480 conveyance or are they just by percentage of growth? 00:05:41.480 --> 00:05:47.520 So the service areas were established at the previous Water Master Plan and it's not specific 00:05:47.520 --> 00:05:52.140 to the water facility since our entire system is interconnected. 00:05:52.140 --> 00:05:58.140 So Lake Louisville water and Lake Ray Roberts water serve the entire city. 00:05:58.140 --> 00:06:03.700 The service areas are established for specific growth regions. 00:06:03.700 --> 00:06:09.600 So the heat map is based off the service areas, so you see 1A is the center, downtown, which 00:06:09.600 --> 00:06:14.880 typically requires less infrastructure growth, versus 1B, which is the perimeter and 2, which 00:06:14.880 --> 00:06:15.880 is the west. 00:06:15.880 --> 00:06:19.440 Okay, so these are growth-based areas, not service-based areas. 00:06:19.440 --> 00:06:20.440 Correct. 00:06:20.440 --> 00:06:24.100 Okay, thank you. 00:06:24.100 --> 00:06:28.760 And then Service Area 2, we've seen a 14% increase. 00:06:28.760 --> 00:06:33.320 These are all compiled with data through the end of 2024, but the growth trends that we're 00:06:33.320 --> 00:06:40.020 seeing in 2025 are aggressive and consistent with this trend. 00:06:40.020 --> 00:06:41.880 So our consultants work with the city of... 00:06:41.880 --> 00:06:43.400 I'm sorry, one more question. 00:06:43.400 --> 00:06:47.880 Water service unit, is that a meter or is that like a million gallons a year or something? 00:06:47.880 --> 00:06:52.600 The water service unit is based off of the meter size, which is based off of consumption. 00:06:52.600 --> 00:06:58.920 So our base service unit is our 5/8 by 3/4 meter, which is enough for a single family 00:06:58.920 --> 00:06:59.920 household. 00:06:59.920 --> 00:07:04.800 So one unit might be a house, 50 units might be a house, or 50 houses, or like a small 00:07:04.800 --> 00:07:05.800 commercial. 00:07:05.800 --> 00:07:10.800 Yes, or like an industrial use or something like that. 00:07:10.800 --> 00:07:14.400 So our consultant worked with the city of Denton's development service department to 00:07:14.400 --> 00:07:18.520 create growth projections for the next 25-year window. 00:07:18.520 --> 00:07:22.320 This projection helps to form the capital improvement plan to accommodate what the city 00:07:22.320 --> 00:07:25.880 will see in development during that timeframe. 00:07:25.880 --> 00:07:33.600 In the 0-5 year window, we see an 8.6% growth projection that tapers down to a 2.9% growth 00:07:33.600 --> 00:07:42.240 in the 5-10 year window and down further to a 2% growth rate in the 25-year window. 00:07:42.240 --> 00:07:48.200 To estimate growth, we used a multitude of internal data sources, such as existing water 00:07:48.200 --> 00:07:54.840 meter data, plan developments in the 25-year development window, and the comprehensive 00:07:54.840 --> 00:08:01.400 plan, which helps to determine future land use categories as well as associated population 00:08:01.400 --> 00:08:02.400 projections. 00:08:02.400 --> 00:08:07.960 Furthermore, we reviewed historic and current population projections from the North Central 00:08:07.960 --> 00:08:10.000 Texas Council of Governments. 00:08:10.000 --> 00:08:14.360 All of these sources are then combined and used to build the population base on which 00:08:14.360 --> 00:08:16.760 the capital improvements are planned. 00:08:16.760 --> 00:08:23.680 The master plan is a living document that changes to adapt the treatment and conveyance 00:08:23.680 --> 00:08:28.360 systems according to the city's evolving needs, and to ensure that water efforts meet the 00:08:28.360 --> 00:08:36.340 Texas Commission on Environmental Quality Planning and Permitting Standards. 00:08:36.340 --> 00:08:41.240 The capital improvement plan prioritizes projects to optimize the city budget. 00:08:41.240 --> 00:08:47.720 It utilizes existing capacity available in existing infrastructure to accommodate future 00:08:47.720 --> 00:08:49.440 growth. 00:08:49.440 --> 00:08:55.040 It improves the system operation by serving customers more efficiently and improving water 00:08:55.040 --> 00:09:00.140 quality, and it ensures water reliability by guaranteeing water supply is adequate to 00:09:00.140 --> 00:09:05.600 meet the anticipated demand and ensure redundancy in the system. 00:09:05.600 --> 00:09:10.760 Because the population growth projections were lower in the 2018 water master plan, 00:09:10.760 --> 00:09:15.560 the conveyance and treatment improvements of that capital improvement plan were less 00:09:15.560 --> 00:09:21.520 intense compared to what we're seeing today. 00:09:21.520 --> 00:09:26.040 So this shows the capital improvement plan projected cost for the 25-year window for 00:09:26.040 --> 00:09:29.920 both the 2018 water master plan and today's update. 00:09:29.920 --> 00:09:37.000 The 2018 water master plan anticipated $245 million worth of infrastructure over that 00:09:37.000 --> 00:09:43.580 time period, while that's upped to $1.124 billion in today's update. 00:09:43.580 --> 00:09:48.360 The reason for the large difference in the projected costs are material costs, which 00:09:48.360 --> 00:09:56.640 have over doubled since 2018, primarily due to inflation and shortages through COVID. 00:09:56.640 --> 00:10:01.600 The population growth in the outer regions is occurring much faster than anticipated, 00:10:01.600 --> 00:10:06.360 so the city of Denton's water conveyance system must be expanded to those regions in order 00:10:06.360 --> 00:10:09.040 to serve the customers. 00:10:09.040 --> 00:10:15.640 And finally, the overall population growth exceeding expectations, more treatment capacity 00:10:15.640 --> 00:10:23.120 is necessary, which causes further expansion of the water treatment plants. 00:10:23.120 --> 00:10:26.920 So the next step is to bring this to city council tomorrow, September 30th for consideration 00:10:26.920 --> 00:10:29.640 and adoption. 00:10:29.640 --> 00:10:32.640 Any questions? 00:10:32.640 --> 00:10:40.920 Could you go to slide 8 for me, so the 2018 you said it was lowered, what was the reason 00:10:40.920 --> 00:10:42.040 for that? 00:10:42.040 --> 00:10:48.480 So the 2018 didn't consider as much growth in the outer regions as we're seeing, so the 00:10:48.480 --> 00:10:54.560 conveyance infrastructure was much smaller based on the growth projections that were 00:10:54.560 --> 00:10:56.240 put together at that time. 00:10:56.240 --> 00:10:59.280 And could you go to slide 7 for me? 00:10:59.280 --> 00:11:08.440 So on the 10 year and the 25 year projections, is that based on interpolation with land availability 00:11:08.440 --> 00:11:09.440 and zoning? 00:11:09.440 --> 00:11:14.360 Yes, so with the comprehensive plan, so the shorter term projections, the 5 and 10 year 00:11:14.360 --> 00:11:20.280 are based off of known developments and known areas where growth is going to occur. 00:11:20.280 --> 00:11:25.120 When you get out to the 25 year window, that's based more on the comprehensive plan, which 00:11:25.120 --> 00:11:31.360 looks at land usage and then estimates population based off of those usage types and acreage. 00:11:31.360 --> 00:11:36.560 And so if we run into, let's say, another 2018 where there's been a decrease, what you're 00:11:36.560 --> 00:11:43.780 presenting, is there a sliding scale as to how you will address those expenses? 00:11:43.780 --> 00:11:46.560 We don't have a sliding scale established, but what we do is-- 00:11:46.560 --> 00:11:49.320 Pardon the expression, just you know what I mean by that. 00:11:49.320 --> 00:11:53.760 Right, we go through, so that's with this as a living document, we go through and do 00:11:53.760 --> 00:11:59.320 regular updates to it to accommodate differences in growth trends. 00:11:59.320 --> 00:12:04.960 So if suddenly we're seeing lower growth in an area, we can push some of that infrastructure 00:12:04.960 --> 00:12:10.300 need out into the farther windows, which would change that final number. 00:12:10.300 --> 00:12:14.760 And with this being the master plan, if something were to occur like that, then does that come 00:12:14.760 --> 00:12:19.860 back to us for just the courtesy of knowing that there's going to be that kind of change 00:12:19.860 --> 00:12:24.520 and then we can recalibrate costs and such at that time, or am I-- 00:12:24.520 --> 00:12:28.440 Yes, we can provide updates as we make changes, regular updates. 00:12:28.440 --> 00:12:32.000 I would like that, if nothing else, just prudent. 00:12:32.000 --> 00:12:33.000 Thank you very much. 00:12:33.000 --> 00:12:34.000 Yes. 00:12:34.000 --> 00:12:40.640 Are there any additional questions? 00:12:40.640 --> 00:12:43.960 Could you move back to slide six? 00:12:43.960 --> 00:12:51.520 So continuing on the vein of Mr. Rayner's comments, I've seen this over the last 20 00:12:51.520 --> 00:12:56.000 years in other areas in the city. 00:12:56.000 --> 00:13:00.420 We're growing really fast right now, 8%, 10%, whatever it is. 00:13:00.420 --> 00:13:06.440 But in five years, we're going to curve down to like a 2% growth rate or 3% growth rate. 00:13:06.440 --> 00:13:15.960 And of course, what happens is that 7%, 8%, 9% growth continues to the next decade. 00:13:15.960 --> 00:13:19.600 So I realize that we don't want to over plan. 00:13:19.600 --> 00:13:22.160 We don't want to make it where that line goes straight up. 00:13:22.160 --> 00:13:32.380 And in 2040, we're looking at 700,000 population yet, and then put in a $5 billion plan. 00:13:32.380 --> 00:13:34.800 But that's likely where we're headed. 00:13:34.800 --> 00:13:40.480 If you look at the map over here, you have all the shaded areas where we're talking about 00:13:40.480 --> 00:13:41.480 growth. 00:13:41.480 --> 00:13:45.480 And then there's a whole lot of other stuff, other area that's just unmarked. 00:13:45.480 --> 00:13:52.240 There's no growth planned at all kind of north of maybe Milam Road area. 00:13:52.240 --> 00:13:56.440 But there are I don't know how many thousands of acres out there. 00:13:56.440 --> 00:14:00.440 And then same thing on the southwest and the far south, maybe mostly built out, but there's 00:14:00.440 --> 00:14:01.920 still areas of development there. 00:14:01.920 --> 00:14:09.880 So I'm just making that comment to say that I know that we're going to come back in the 00:14:09.880 --> 00:14:11.760 next five years. 00:14:11.760 --> 00:14:12.760 That growth rate is going to continue. 00:14:12.760 --> 00:14:18.240 And we're going to have to update it again to account for that additional growth. 00:14:18.240 --> 00:14:24.320 I don't know what the balance is between being conservative, not over projecting, but also 00:14:24.320 --> 00:14:28.840 making this realistic where we can plan 10 or 15 years in the future. 00:14:28.840 --> 00:14:35.000 Because when we're talking about billion dollar water treatment plants and land acquisition 00:14:35.000 --> 00:14:39.480 and new conveyance systems for entirely new wastewater treatment plants, you know, those 00:14:39.480 --> 00:14:43.160 are 20 year processes. 00:14:43.160 --> 00:14:56.000 And if we make our projections too low, then we're always racing to catch up to the growth. 00:14:56.000 --> 00:15:00.600 So just my comment is we need this update. 00:15:00.600 --> 00:15:09.920 And I would I would like to see how we can make the longer term forecasts as realistic 00:15:09.920 --> 00:15:15.120 as possible to to really account for the fact that we're going to we're going to need like 00:15:15.120 --> 00:15:21.480 this one point one billion dollars in infrastructure is kind of what we know we need basically 00:15:21.480 --> 00:15:26.520 in the next probably 10 years, and then we're really going to need another one or two billion, 00:15:26.520 --> 00:15:30.840 especially in 2040 dollars at that time. 00:15:30.840 --> 00:15:34.680 We could provide that information with regular updates as well as it changes. 00:15:34.680 --> 00:15:38.920 Are you suggesting they make some modifications to this? 00:15:38.920 --> 00:15:42.520 I don't I think it's I think it's too late in this process. 00:15:42.520 --> 00:15:46.440 And you know, there's like I said, there's I know there's this balance of we don't want 00:15:46.440 --> 00:15:47.440 to overestimate. 00:15:47.440 --> 00:15:52.440 We don't want to like make these huge, scary projections, but we tend to decide for the 00:15:52.440 --> 00:15:58.880 last 20 years, I've seen on planning on city budget on, you know, utility budget, this 00:15:58.880 --> 00:16:02.240 five years of growth, and then it's going to flatten out and it just kind of keeps having 00:16:02.240 --> 00:16:06.040 this little the turndown that never happens really. 00:16:06.040 --> 00:16:09.880 And it and it skews our planning and makes it where we're always behind because we're 00:16:09.880 --> 00:16:13.480 really only planning for the next five years of growth and not the next 10 or 20 years 00:16:13.480 --> 00:16:20.160 of growth, so just something that going forward, we want to be aware of and not and I think 00:16:20.160 --> 00:16:24.120 everybody on the commission agrees, it's not really realistic that we're just going to 00:16:24.120 --> 00:16:28.360 stop growing in 2030. 00:16:28.360 --> 00:16:39.040 If there are no other questions or comments, chair would entertain a motion. 00:16:39.040 --> 00:16:43.240 Second, we have a motion and a second. 00:16:43.240 --> 00:16:48.680 For recommending approval of adoption of the new water master plan. 00:16:48.680 --> 00:16:49.880 All in favor say aye. 00:16:49.880 --> 00:16:50.880 Aye. 00:16:50.880 --> 00:16:51.880 Any opposed? 00:16:51.880 --> 00:16:53.920 The motion carries unanimously. 00:16:53.920 --> 00:16:56.040 Thank you. 00:16:56.040 --> 00:16:59.800 Thank you. 00:16:59.800 --> 00:17:01.720 Now we'll move into management reports. 00:17:01.720 --> 00:17:06.840 Mr. Chair, members of the board, we don't have any items on the new business section. 00:17:06.840 --> 00:17:07.840 There's nothing pending. 00:17:07.840 --> 00:17:12.360 I do want to point out on the future agenda items, there's two things that are coming 00:17:12.360 --> 00:17:18.640 up for you on the 13th, we'll be bringing to you the 2026 schedule, so we'll try to 00:17:18.640 --> 00:17:19.640 get that out to you. 00:17:19.640 --> 00:17:24.680 So please look at that and if there's dates on there that may be a conflict, you know, 00:17:24.680 --> 00:17:29.240 there might still be an opportunity here to try to reorder some of that schedule and then 00:17:29.240 --> 00:17:37.020 I want to also remind everyone that on June 12th, we will be reelecting or electing officers 00:17:37.020 --> 00:17:39.120 to this board, right? 00:17:39.120 --> 00:17:46.240 There are no term limits per se, but certainly if one of our incumbents is no longer wishing 00:17:46.240 --> 00:17:52.400 to continue in a position, please let us know so that we can communicate that to the other 00:17:52.400 --> 00:17:53.400 board members. 00:17:53.400 --> 00:17:57.040 If somebody's interested, I can't remember the last time we had a contested race, you 00:17:57.040 --> 00:18:01.440 know, but if there is that, there is a process for us to go through that as well. 00:18:01.440 --> 00:18:06.120 I'm sure Marcella would love to help us kind of walk through that, but with that, that 00:18:06.120 --> 00:18:12.140 is our management update, happy to answer any questions you may have. 00:18:12.140 --> 00:18:18.480 Seeing no questions, I think we can go ahead and move on to our closed meeting. 00:18:18.480 --> 00:18:23.920 So the Public Utilities Board will now at 918 a.m. convene into a closed meeting to 00:18:23.920 --> 00:18:28.520 deliberate closed meeting items set forth in the agenda. 00:18:28.520 --> 00:18:35.760 Item A, deliberations regarding certain public power utilities competitive matters, and item 00:18:35.760 --> 00:18:40.600 B, deliberations regarding real property. 00:18:40.600 --> 00:18:51.400 Do I need to call those as two separate ones or can we call it as one? 00:18:51.400 --> 00:18:57.680 The Public Utilities Board has now at 952 a.m. reconvened from the closed session and no 00:18:57.680 --> 00:18:59.680 official action was taken. 00:18:59.680 --> 00:19:08.320 We'll just mention that Commissioner Rayner was recused from the item B in the closed 00:19:08.320 --> 00:19:11.920 session. 00:19:11.920 --> 00:19:23.880 We will now consider items for individual consideration B, the recommendation of adoption 00:19:23.880 --> 00:19:29.880 of an ordinance for a PPA for utility scale battery storage. 00:19:29.880 --> 00:19:30.880 Thank you. 00:19:30.880 --> 00:19:34.640 Good morning, Chairman, members of the PUB. 00:19:34.640 --> 00:19:40.200 My name is Jose Gaitan, Executive Manager of Power Supply for DME and I'm here to provide 00:19:40.200 --> 00:19:49.120 you a presentation on one of the 1,300 proposals that we received as part of RFP 8678 that 00:19:49.120 --> 00:19:57.480 was issued back in November of 2024 to continue to procure additional renewable sources for 00:19:57.480 --> 00:20:02.560 the Denton Renewable Resource Plan. 00:20:02.560 --> 00:20:07.800 Again as a summary for some of the challenges that both ERCOT and DME will be facing over 00:20:07.800 --> 00:20:13.940 the next several years into the future is this concept of the duck curve. 00:20:13.940 --> 00:20:19.360 When the duck curve is those hours between 6 and 9 p.m. as the sun goes over the horizon 00:20:19.360 --> 00:20:25.240 solar production goes down to zero and wind will be ramping into the afternoon, could 00:20:25.240 --> 00:20:26.800 be close to zero. 00:20:26.800 --> 00:20:34.280 The reduction in renewable output and the demand still being high due to temperatures 00:20:34.280 --> 00:20:39.920 whether it's high temperatures in the summer or low temperatures in winter creates price 00:20:39.920 --> 00:20:47.060 volatility as the renewable production drops down into those hours. 00:20:47.060 --> 00:20:54.720 And so the utility, our customers, could be impacted as more and more of our load is exposed 00:20:54.720 --> 00:20:58.960 to those $5,000 prices. 00:20:58.960 --> 00:21:08.440 So as a way to mitigate those risks we're bringing forward is battery storage solution. 00:21:08.440 --> 00:21:16.880 Some of the details of this proposal is it's a 10-year term for 100 megawatts of capacity 00:21:16.880 --> 00:21:19.240 with two hours of duration. 00:21:19.240 --> 00:21:25.480 It's available starting June of 2026 and the pricing is inclusive of federal investment 00:21:25.480 --> 00:21:29.600 tax credits. 00:21:29.600 --> 00:21:35.400 It is a financial hedge for the utility, right, so it allows us to avoid having to go and 00:21:35.400 --> 00:21:41.240 procure additional sources of energy over in the market. 00:21:41.240 --> 00:21:47.480 It's a stop gap from those events where we have abnormally hot winters or abnormally 00:21:47.480 --> 00:21:49.260 cold winters. 00:21:49.260 --> 00:21:57.920 So it helps mitigate some of those cost increases to our utility while, you know, providing 00:21:57.920 --> 00:22:04.480 us a stop gap for those additional costs that we've seen in the past like 2023 where we 00:22:04.480 --> 00:22:12.100 saw a $30 million increase in costs for purchase power. 00:22:12.100 --> 00:22:20.320 This facility is located in central Texas, just southeast of Waco, about 70 miles southeast. 00:22:20.320 --> 00:22:26.960 This facility is owned and operated by Jupiter Power, one of the largest battery storage 00:22:26.960 --> 00:22:31.440 owners in ERCOT and developer in North America. 00:22:31.440 --> 00:22:39.760 They have over 11,000 megawatts of battery storage. 00:22:39.760 --> 00:22:44.120 As we've mentioned, this facility, again, is a financial hedge for the utility. 00:22:44.120 --> 00:22:50.000 It's available in June of 2026 and the majority of the project is not subject to tariffs, 00:22:50.000 --> 00:22:55.480 which is great for us in reducing costs overall for this project. 00:22:55.480 --> 00:23:02.360 Again, our staff recommendation is to provide a recommendation to City Council to approve 00:23:02.360 --> 00:23:07.100 the Tudwell Prairie II PPA. 00:23:07.100 --> 00:23:08.520 And that concludes my presentation. 00:23:08.520 --> 00:23:14.360 Are there any questions? 00:23:14.360 --> 00:23:16.080 I see no questions. 00:23:16.080 --> 00:23:17.280 I just want to have a comment. 00:23:17.280 --> 00:23:25.720 This is a good way for DME, I think, to begin operating a battery. 00:23:25.720 --> 00:23:29.440 It'll be built and operated by Jupiter, but we will have control of it. 00:23:29.440 --> 00:23:30.440 That's correct. 00:23:30.440 --> 00:23:35.560 So this will be a good way for DME to get that experience. 00:23:35.560 --> 00:23:41.320 It has a cost, but it has a risk benefit, a pretty good risk benefit. 00:23:41.320 --> 00:23:45.240 And I expect that we'll be seeing more of these in the coming decade as they become 00:23:45.240 --> 00:23:49.200 more common and are caught as prices come down. 00:23:49.200 --> 00:23:53.360 With that comment, I would entertain a motion recommending adoption. 00:23:53.360 --> 00:23:56.880 I recommend it's adoption and I second your comments. 00:23:56.880 --> 00:23:57.880 We have a motion. 00:23:57.880 --> 00:23:58.880 Do we have a second? 00:23:58.880 --> 00:23:59.880 I'll just second the motion. 00:23:59.880 --> 00:24:00.880 All right. 00:24:00.880 --> 00:24:01.880 I think Mr. Neuquist second. 00:24:01.880 --> 00:24:02.880 All in favor say aye. 00:24:02.880 --> 00:24:03.880 Aye. 00:24:03.880 --> 00:24:04.880 The motion carries unanimously. 00:24:04.880 --> 00:24:16.880 We'll move on to item for individual consideration C, recommending adoption of an ordinance for 00:24:16.880 --> 00:24:24.120 a PPA for the Blue Summit 1 wind generation. 00:24:24.120 --> 00:24:27.540 Good morning, Chair, members of the Public Utility Board. 00:24:27.540 --> 00:24:31.680 My name is Jose Gaitan, Executive Manager, Power Supply for DME. 00:24:31.680 --> 00:24:37.800 I'm here to present to you the proposal for Blue Summit 1 wind generation facility as 00:24:37.800 --> 00:24:48.200 part of RFP 8678 that was issued in November of 2024 to procure additional renewable energy 00:24:48.200 --> 00:24:56.520 sources to continue our 100% goal of having renewable energy as part of the Dention Renewable 00:24:56.520 --> 00:25:01.000 Resource Plan. 00:25:01.000 --> 00:25:08.600 Some of the details of this proposal is it's a 15-year term for about 140 megawatts of 00:25:08.600 --> 00:25:09.920 capacity. 00:25:09.920 --> 00:25:13.000 The good thing is that this facility is available now. 00:25:13.000 --> 00:25:19.680 The prices for this project are inclusive of current federal production tax credits. 00:25:19.680 --> 00:25:24.320 So because it's already producing energy, it's more than likely going to be grandfathered 00:25:24.320 --> 00:25:30.560 in should there be any changes in the future for the PTC. 00:25:30.560 --> 00:25:37.040 On top of that, this facility, it provides us a diversification of generation production 00:25:37.040 --> 00:25:41.960 as we have a lot of solar projects currently. 00:25:41.960 --> 00:25:48.840 This facility will, again, allow us to generate power at night and into the afternoons, which 00:25:48.840 --> 00:25:54.600 is where we believe what we'll have a need due to the duck curve and other issues that 00:25:54.600 --> 00:26:00.480 we see as nighttime prices start to increase, as we see in more and more development of 00:26:00.480 --> 00:26:05.740 data center load, which will start absorbing a lot more of that cheaper nighttime power. 00:26:05.740 --> 00:26:13.880 So we see in the future increases in nighttime power costs going forward. 00:26:13.880 --> 00:26:23.240 Again, this facility is owned and operated by Nextera, one of the largest generators 00:26:23.240 --> 00:26:28.320 of clean power in not just ERCOT, but North America. 00:26:28.320 --> 00:26:36.580 They have over 119 projects in the U.S. and Canada. 00:26:36.580 --> 00:26:42.520 The Blue Summit One Wind Facility is located near Vernon, Texas, near the Panhandle, and 00:26:42.520 --> 00:26:44.360 so we have a great source. 00:26:44.360 --> 00:26:46.720 Production will be relatively high. 00:26:46.720 --> 00:26:55.160 Again, this is a repowered facility with more modern blades and modern turbines. 00:26:55.160 --> 00:27:00.960 So great location, great facility, great owner, actually. 00:27:00.960 --> 00:27:06.900 So now we kind of take a look at what our portfolio of renewables looks like. 00:27:06.900 --> 00:27:12.740 If Council were to approve this facility, that would bring us to about 594 megawatts 00:27:12.740 --> 00:27:13.900 of energy. 00:27:13.900 --> 00:27:22.240 The 15-year term for this facility will take us all the way to January of 2040. 00:27:22.240 --> 00:27:33.600 So again, just recapping what we've gone over, again, this facility helps us by diversifying 00:27:33.600 --> 00:27:40.400 the renewable production over the day and years going out. 00:27:40.400 --> 00:27:45.440 We have production at night, which is one thing that we're not seeing as much of is 00:27:45.440 --> 00:27:48.200 development of wind farms. 00:27:48.200 --> 00:27:53.320 So this may be one of the last abilities to get some additional wind. 00:27:53.320 --> 00:27:56.960 Again, this facility is available now. 00:27:56.960 --> 00:28:05.680 It doesn't really provide us 100% price mitigation, but again, the diversity we believe is a value 00:28:05.680 --> 00:28:12.120 to this facility, and it helps us continue our renewable goals. 00:28:12.120 --> 00:28:20.360 So with that, the staff recommendation is that the PUB provide a recommendation to Council 00:28:20.360 --> 00:28:24.120 to approve the Blue Summit One Wind PPA. 00:28:24.120 --> 00:28:26.840 And with that, that concludes my presentation. 00:28:26.840 --> 00:28:27.840 Are there any questions? 00:28:27.840 --> 00:28:36.080 >> I just have a comment, I really appreciate the complementary nature of these two proposals 00:28:36.080 --> 00:28:37.080 together. 00:28:37.080 --> 00:28:38.080 >> Absolutely. 00:28:38.080 --> 00:28:39.080 >> Excellent work by staff. 00:28:39.080 --> 00:28:42.080 >> Thank you. 00:28:42.080 --> 00:28:43.080 >> Any further questions? 00:28:43.080 --> 00:28:47.480 I'll entertain a motion. 00:28:47.480 --> 00:28:52.600 We have a motion. 00:28:52.600 --> 00:28:53.600 And we have a second. 00:28:53.600 --> 00:28:55.960 All in favor say aye. 00:28:55.960 --> 00:28:59.200 And the motion carries unanimously. 00:28:59.200 --> 00:29:08.200 And now we'll move on to our last two items pulled from the consent agenda. 00:29:08.200 --> 00:29:21.040 And we will bid Commissioner Rayner farewell for the day. 00:29:21.040 --> 00:29:32.400 Now, item M, consider of the consent agenda, consider recommending adoption. 00:29:32.400 --> 00:29:35.880 Do we consider them both together or do we have to vote on them individually? 00:29:35.880 --> 00:29:36.880 >> On them individually. 00:29:36.880 --> 00:29:37.880 >> Okay. 00:29:37.880 --> 00:29:43.000 Consider adopting, recommending adoption of an ordinance to purchase 3.682 acres of land 00:29:43.000 --> 00:29:47.440 for the DME, near the DME campus. 00:29:47.440 --> 00:29:48.440 >> So moved. 00:29:48.440 --> 00:29:49.440 >> We have a motion. 00:29:49.440 --> 00:29:50.440 Do we have a second? 00:29:50.440 --> 00:29:51.440 >> Second. 00:29:51.440 --> 00:29:52.440 >> Commissioner Newquist. 00:29:52.440 --> 00:29:53.440 All in favor say aye. 00:29:53.440 --> 00:29:54.440 >> Aye. 00:29:54.440 --> 00:29:55.440 >> Motion carries. 00:29:55.440 --> 00:30:02.320 Now, item N, recommended adoption of an ordinance purchasing 9.218 acres of land along Shady 00:30:02.320 --> 00:30:03.320 Oaks Drive. 00:30:03.320 --> 00:30:04.320 >> So moved. 00:30:04.320 --> 00:30:06.120 >> We have a motion. 00:30:06.120 --> 00:30:07.120 And another second. 00:30:07.120 --> 00:30:08.120 All in favor? 00:30:08.120 --> 00:30:09.120 >> Aye. 00:30:09.120 --> 00:30:10.880 >> Motion carries unanimously. 00:30:10.880 --> 00:30:13.320 I believe we are adjourned.