LADWP Crews Prepare for Runoff from Record Snowpack Melt
April 28, 2023
by Paul Ciampoli
APPA News Director
April 28, 2023
The Los Angeles Department of Water and Power on April 25 said it has begun preparing early for this year’s runoff based on lessons learned from the last extreme wet year in 2017.
The historic snowpack levels in the Eastern Sierra of 296 percent of normal translates into runoff that is 233 percent of normal, LADWP said. That translates into one million acre feet, or 326-billion gallons of water that will need to be managed.
The runoff season is expected to last through the summer months, requiring significant preparation work and coordination with partner agencies in the Eastern Sierra to implement public safety measures to mitigate the potential for flooding, the utility reported.
“We have had crews and personnel making the necessary preparations since last December and are ready to respond when the snow begins to melt,” said Anselmo Collins, Senior Assistant General Manager of LADWP’s Water System. “A typical runoff season can last anywhere from May to June. However, with our record snowpack this year and the volume of water that translates into once the snow melts, the season may push through to August.”
“We have already begun managing excess flows by spreading water throughout the aqueduct system to replenish local groundwater aquifers, and maximizing flows in the LA Aqueduct by emptying reservoirs to create more storage space for runoff waters,” said Adam Perez, LADWP’s Aqueduct Manager. “This allows us to supply Los Angeles with aqueduct water in place of purchased and pumped water wherever possible.”
Currently, approximately 130 billion gallons of water is expected to make its way to Los Angeles this spring and summer via the Los Angeles Aqueduct, potentially enough to meet 80 percent of LA’s annual demand, to serve more than 1 million LA households for a year, LADWP said.
The utility said that despite these efforts, a high volume of runoff will still remain in the Eastern Sierra and require management efforts. Additional emergency hires have been put in place to support the increased construction and operational needs. Equipment, such as excavators, backhoes, and in-flow meters, have also been purchased and strategically placed in key locations to expedite response during the runoff season.
Other preparation work includes repairing diversion structures damaged during heavy rainfall earlier this year to ready spreading grounds to receive the runoff; repairing and cleaning ditches that receive the runoff; and shoring up areas of Owens Lake to minimize the expected damage rising water levels may pose to dust mitigation infrastructure.
Wilson Energy’s John Maclaga Details Supply Chain Challenges in Meeting With Lawmakers
April 28, 2023
by Paul Ciampoli
APPA News Director
April 28, 2023
In a recent meeting with House members, John Maclaga, Assistant Director for North Carolina public power utility Wilson Energy, detailed the current supply chain challenges facing the electric power sector and offered potential solutions to alleviate those challenges.
Maclaga participated in an April 19 roundtable in Washington, D.C., convened by the bipartisan Supply Chain Caucus led by Reps. David Rouzer (R-NC), Dusty Johnson (R-SD), Colin Allred (D-TX), and Angie Craig (D-MN).
In an interview with Public Power Current, Maclaga praised the caucus members for “being a truly bipartisan group” of lawmakers who are “taking leadership on this, showing an interest in this” and seeking tangible solutions.
“The reliability and security of the electric grid is at stake if we don’t take action to address the supply chain crisis we’re seeing today,” Maclaga said in a statement related to the roundtable. “Lead times and prices for transformers, utility poles, bucket trucks, and other critical equipment have increased exponentially since the start of the pandemic, with lead times for trucks, for example, jumping from 12 to 60 months and prices increasing four-to-five fold.”
He said that Congress and regulators should make sure the federal government is supporting the development of more robust supply chains and onshoring of manufacturing of critical infrastructure components.
Specifically, Maclaga said that the Department of Energy should be encouraged to halt a proposed rule on transformer efficiency standards. In December, DOE announced it was proposing new energy efficiency standards for distribution transformers.
The proposed rule discourages the remaining U.S. grain-oriented electrical steel (GOES) steel producers and traditional transformer manufacturers from adding any GOES capacity or continuing existing capacity, he argued.
At the meeting, Maclaga noted that DOE has plans to expand electrification, promote electric vehicle use, add additional solar energy and create more energy efficient buildings. “I can’t bring these things online if I can’t connect them,” he said.
He also proposed appropriating $1 billion through the Defense Production Act to increase all forms of distribution and substation transformer manufacturing in the U.S. and directing the Federal Emergency Management Agency to invest in a national stockpile of distribution transformers when/if demand for distribution transformers falls below 2019 levels.
In late 2022, APPA, the Edison Electric Institute, and the National Rural Electric Cooperative Association submitted comments in which they said that DOE should use Defense Production Act authorities to prioritize distribution transformers, large power transformers, and other critical grid components ahead of other technologies, and it should act quickly to alleviate the most acute supply chain challenge with distribution transformers.
Maclaga said in the interview that he urged the lawmakers to “appropriate money in orders of magnitude of billions of dollars to give manufacturers a chance.”
Elaborating on the stockpile idea, he said that “another way to incentivize manufacturers to make more stuff including transformers” would be to start stockpiling equipment. “Don’t buy anything now. Find out what you want to buy, get your specs right, make the announcement. Tell manufacturers we’ve got $20 billion in a FEMA fund to go buy these transformers and when your demand and your production loads gets back to a 2019 lead time again, we’ll start buying them to build the FEMA stockpile. So then if you’re a manufacturer and you’re on the edge of buying a new production facility – maybe you can get a grant to build it – and then go ahead and wear out your three-year backlog as fast as you can and then at the other end of it, FEMA’s going to be there. If you’re first to the trough, knowing that you’ve got your demand levels down, you can be first to the FEMA transformer sale and beat your competitors to the punch.”
What Wilson Energy is Doing to Address Supply Chain Challenges
Maclaga also detailed what Wilson Energy has done to address supply chain challenges.
He said that the utility has been working with ElectriCities of North Carolina to do more joint purchasing.
The utility has been making a push for more standardization when it comes to buying transformers, making the analogy to ordering a pizza.
When a manufacturer asks “what do you want on your transformer? I want it plain with cheese…because I really just want a transformer at this point and I don’t care whether it has taps, or special locks on it or my company’s sticker. I don’t care about that stuff anymore. I just want a transformer.”
Noting that Wilson Energy is an AMI and GIS system, “we have some talented people on staff that have been using those two systems to go look at where do we have transformers that are underused or overused. In other words, transformer right sizing.”
Maclaga said that pre-pandemic, it was not economical to keep old transformers. “In other words, we got them off from some old piece of line we were rebuilding, take those fifty-year-old transformers down, we’ll take them to a scrapper and sell them.” But now, “we’re not scrapping anything unless it can’t be safely turned on.”
House Members Urge DOE to Withdraw Proposed Rule for Distribution Transformers
More than 60 House members on April 3 urged Secretary of Energy Jennifer Granholm to withdraw the proposed rule to increase conservation standards for distribution transformers.
The efficiency standards for distribution transformers proposed by DOE would worsen current distribution transformer supply shortages and, to the extent that they are even feasible, would impose significant costs on consumers, the American Public Power Association said in March.
The electric industry is currently experiencing a critical shortage of distribution transformers, “and the efficiency standards included in the NOPR would likely exacerbate a supply shortfall that has already reached crisis levels, threatening electric reliability, economic development, and the ongoing transition to lower-emitting generating resources,” APPA argued in its March 27 comments to DOE regarding the NOPR.
Department of Energy Laboratories Test Virtual Nuclear-Renewable Hybrid Plant
April 27, 2023
by Peter Maloney
APPA News
April 27, 2023
Two national laboratories have completed a test of a virtual nuclear-renewable hybrid power plant.
The test involved a solar array, battery storage system, hydrogen fuel electrolyzer, and a controllable grid interface at the National Renewable Energy Laboratory in Golden, Colo., connected via a high-speed fiber optic network to simulations of a small modular nuclear reactor and high-temperature electrolysis unit at Idaho National Laboratory in Idaho Falls, Idaho.
Utah Associated Municipal Power Systems and its partners, NuScale Power Fluor Corporation, and the Department of Energy, are developing a small modular reactor project at an Idaho National Laboratory facility.
Utah Associated Municipal Power Systems and NuScale Power, along with Shell Global Solutions, are also assessing a process for producing hydrogen using small modular nuclear reactors.
The Colorado and Idaho operations were connected in real time using the Department of Energy’s Energy Sciences Network that uses fiber optic cable to provide high-speed, low-latency, and low-jitter data connections. The researchers said the connection created a “Super Lab” that allowed them to study energy systems currently not in existence to demonstrate that renewable and nuclear energy, combined within a hybrid system, can complement each other to support the grid.
During the demonstration, the researchers simulated a sudden loss in solar power from a passing cloud, and the nuclear reactor stepped in to support grid demand.
The tested scenarios provide developers a baseline and high-quality operational data for how hybrid renewables-nuclear designs might operate together for a reliable power grid, the researchers said.
For the next SuperLab demonstration, scheduled for late 2023, Department of Energy researchers plan to simulate a national-scale disaster across eight national laboratories to study how a major outage from a hurricane or cyberattack would play out on a distributed energy system. The scale of the experiment would involve 10,000 devices and be much larger than previous demonstrations, they said.
California CCA Group Issues Request for Information on Offshore Wind Projects
April 27, 2023
by Peter Maloney
APPA News
April 27, 2023
California Community Power recently issued a request for information for offshore wind projects in the Humboldt and Morro Bay areas, as well as other possible offshore wind developments.
California Community Power, which represents nine community choice aggregators from Humboldt to Santa Barbara counties, said it plans to use the results of the RFI to inform board recommendations regarding procurement, readiness, and barriers to offshore wind projects.
In 2021, the Department of the Interior with the Department of Defense and the state of California identified Morro Bay off California’s central coast as an area that could support up to 3 gigawatts of offshore wind projects. Together with the Humboldt area off the state’s northern coast Interior the areas could support as much as 4.6 gigawatts of offshore wind energy.
In December 2022, the Bureau of Ocean Energy Management, a division of the Department of the Interior, awarded five leases for offshore wind power development along the California coast.
“Offshore wind energy can provide steady, valuable, and renewable energy to meet California’s clean energy needs, including during heat storms when the grid is taxed,” Matthew Marshall, California Community Power board member and Redwood Coast Energy Authority executive director, said in a statement. “This RFI fits with the goals of CC Power. Gathering information and signaling interest in offshore wind is a prudent step for CC Power to gear up in exploring contracting for new offshore wind resources.”
If contracted for development by California Community Power, the offshore wind projects would be included in each community choice aggregator’s resource plan, and California Community Power said it would administer contracts to drive development and operations of new resources.
California Community Power members represent 2.7 million customers across 112 municipalities.
“This joint-action RFI will focus on California’s opportunity for floating offshore wind turbines, a technology gradually being deployed around the world,” Alex Morris, general manager of California Community Power, said in a statement. “This RFI helps us build formal recommendations on procurement for our Board and will inform strategies to address needs for port infrastructure and expanded electrical grid transmission, known barriers for offshore wind development in California.”
More information regarding the California Community Power Request for Information is available at https://cacommunitypower.org/solicitations/.
N.Y. Legislative Commission Delivers Draft Report on Transitioning LIPA to Owner, Operator of Grid
April 26, 2023
by Paul Ciampoli
APPA News Director
April 26, 2023
The New York State Legislative Commission on the Future of the Long Island Power Authority on April 18 approved a draft report for submission to the New York Legislature detailing its preliminary findings and plan for transitioning LIPA into a public power provider that would both own and operate the electric grid on Long Island and in the Rockaways.
The Commission will now conduct another round of public hearings and consult with its fifteen member advisory committee before delivering a final report to the legislature in time for its recommendations to be acted upon this legislative session.
The draft report lays out the operational, legal, and legislative steps necessary to achieve full public power at the expiration of PSEG Long Island’s contract on December 31, 2025.
The draft report’s key financial finding is that LIPA can save between nearly $50 million and $80 million a year by operating its electric grid itself without hiring an outside, for-profit utility – PSEG Long Island – to operate it for them, after one-time transition costs of between $16 million and $59 million.
In late 2021, LIPA announced a revised management services contract and settlement with PSEG Long Island that included reforms designed to drive performance and accountability, while providing an unprecedented level of oversight of PSEG Long Island’s operations.
North Carolina Planning Collaborative Identifies 38 Major Transmission Projects
April 26, 2023
by Paul Ciampoli
APPA News Director
April 26, 2023
Participants in the North Carolina Transmission Planning Collaborative have identified 38 major transmission projects that will improve the electric transmission infrastructure as part of a 2022-2032 collaborative transmission plan, ElectriCities of North Carolina said on April 13.
The 38 major transmission projects in the 2022 plan represent $1.49 billion in new transmission investments during the next decade. This includes 24 reliability projects representing more than $936 million in investments and 14 additional public policy projects representing more than $554 million in investments that will enable the interconnection of new resources and replace aging infrastructure.
The major transmission projects identified in the 2022 plan are expected to be implemented during the next 10 years by the transmission owners to enhance system reliability and resiliency, support addition of new generation resources, and potentially enable increased economic electricity transfers across the transmission network. Major projects are defined as those requiring transmission investments of more than $10 million each.
The 2022 plan includes nine new Duke Energy Carolinas reliability projects totaling more than $255 million in new transmission investments. The in-service dates and cost estimates for some planned or underway 2022 reliability projects have been revised from the previous year’s plan report.
The 2022 plan includes four new DEC and ten new Duke Energy Progress public policy projects totaling more than $554 million in new transmission investments.
The NCTPC was formed in 2005 by the load-serving entities to ensure DEC and DEP develop a shared plan for electric transmission system enhancements located in the states of North Carolina and South Carolina.
Those LSEs include DEC, DEP, ElectriCities of North Carolina, which serves public power communities across the state, and North Carolina’s Electric Cooperatives’ generation and transmission arm, North Carolina EMC, which serves as the power supplier for most of the state’s electric cooperatives.
Since its inception in 2005, transmission projects totaling more than $2.919 billion have been identified in the NCTPC plans. More than $1.158 billion in projects have been placed in service through the end of 2022, $1.46 billion are still in the planning stage and another $299 million were deferred until after 2032 or cancelled as a result of changing transmission system requirements. The plan is updated annually.
The NCTPC was established to provide participants and other stakeholders an opportunity to participate in the electric transmission planning process and develop a single coordinated transmission plan that includes reliability, resource supply additions, public policy, and local economic study transmission planning considerations. The group’s priority is to appropriately balance costs, benefits and risks associated with the use of transmission and generation resources.
Another goal of the NCTPC is to study the strength of the transmission infrastructure of DEC and DEP. The scope of the 2022 NCTPC study included a base reliability analysis for transmission needs to meet load growth between 2022 and 2032.
For a variety of reasons, such as load growth, generation retirements, or power purchase agreements expiring, LSEs may wish to evaluate other resource supply options to meet future load demand. These resource supply options can be either in the form of transactions or some hypothetical generators added to meet resource adequacy requirements for this study.
In 2022, the NCTPC also examined the impacts of 14 different hypothetical transfers into, out of, and through the DEC and DEP systems under the Local Economic Planning Process. The results of these studies are documented in Section VI of the 2022 Plan report.
“The NCTPC provides a valuable function by allowing stakeholders to better understand the electric transmission planning process,” said Marty Berland of ElectriCities of North Carolina, Chairman of the NCTPC Oversight/Steering Committee. “By offering greater transparency and opportunity to provide input to the process, entities that rely on the transmission system can collaborate to develop plans for future enhancements in a manner that optimizes cost effectiveness and reliability.”
SPP Market Participation Helps Colorado Springs Utilities Save Customers $2.1 million
April 26, 2023
by Paul Ciampoli
APPA News Director
April 26, 2023
From August to December 2022, Colorado Springs Utilities saved its customers approximately $2.1 million through its involvement in the Southwest Power Pool’s Western Energy Imbalance Market, the public power utility recently said.
The cost savings were realized thanks to energy-related purchases through the WEIS market that were below Colorado Springs Utilities’ cost to generate electricity locally and market sales of excess power generation.
Colorado Springs Utilities entered the SPP WEIS market in August 2022 to ensure reliable supplies of power, adequate transmission infrastructure and competitive wholesale electricity prices, it said.
“To realize more than $2 million in cost savings in just five months highlights why we joined SPP WEIS,” said the utility’s CEO Travas Deal. “By participating in shared resource pools like SPP WEIS, we can help maintain system reliability and manage energy costs for our customers – no matter regulatory mandates or market-related pressures.”
SPP’s WEIS helps Colorado Springs Utilities manage current and future energy costs “by having real-time access to the latest market intelligence, enhance the resiliency of its electric grid and help the organization access the lowest cost resources from other member utilities,” the utility said.
FERC Approves Incentive Rate Treatment for Cybersecurity Investments
April 24, 2023
by Paul Ciampoli
APPA News Director
April 24, 2023
The Federal Energy Regulatory Commission on April 21 issued a final rule providing incentive-based rate treatment for utilities making certain voluntary cybersecurity investments.
The final rule follows Congress’ direction under the Infrastructure Investment and Jobs Act of 2021 that the Commission revise its regulations to establish incentive-based rate treatments to encourage utilities to invest in advanced cybersecurity technology and participate in cybersecurity threat information sharing programs for the benefit of consumers.
In response to the notice of proposed rulemaking that preceded the final rule, APPA urged FERC to reconsider several aspects of the NOPR, including a proposal to allow a 200-basis point return on equity adder on eligible investments.
FERC said that the final rule largely tracks the Notice of Proposed Rulemaking issued September 22, 2022.
However, it also includes some important additions, the Commission said.
Specifically, the Commission expanded the definition of eligible cybersecurity investments to include not only a pre-qualified list of cybersecurity investments, but also those investments that are made on a case-by-case basis, allowing utilities to request incentives for a variety of solutions tailored to their specific situations.
The Commission will also allow utilities to seek incentives for early compliance with new cybersecurity reliability standards.
The final rule adopts the NOPR’s proposed requirement that expenditures materially improve a utility’s cybersecurity posture.
It also adopts the proposal to allow deferred cost recovery that would enable the utility to defer expenses and include the unamortized portion in its rate base, but does not adopt the proposed return on equity adder of 200 basis points.
The rule also states that approved incentives, with certain exceptions, will remain in effect for up to five years from the date on which expenses are incurred, provided that the investments remain voluntary.
The final rule takes effect 60 days following publication in the Federal Register.
Commissioner Danly Dissents
FERC Commissioner James Danly dissented from the final rule.
He said the final rule is not in line with the Infrastructure Investment and Jobs Act directive to establish incentive-based rate treatments that encourage investments by utilities in advanced cybersecurity technology and participation by utilities in cybersecurity threat information.
Fitch Upgrades Ratings for Keys Energy Services to ‘AA-‘
April 24, 2023
by Paul Ciampoli
APPA News Director
April 24, 2023
Fitch Ratings on April 12 upgraded revenue bonds for Florida public power utility Keys Energy Services to AA-.
Specifically, the rating agency upgraded approximately $76 million in outstanding electric system revenue bonds, series 2019 and series 2014 to ‘AA-‘ from ‘A+’ and the Issuer Default Rating (IDR) to ‘AA-‘ from ‘A+’.
The bonds and IDR have been assigned a Stable Rating Outlook.
Keys Energy Services is the public power utility for the Lower Florida Keys. Headquartered in Key West, Florida, it provides electricity from Key West to the Seven-Mile Bridge and serves more than 30,000 customers.
Keys Energy Services’ rating upgrade to ‘AA-‘ from ‘A+’ “reflects the utility’s very strong and improved financial performance, evidenced by consistently strong operating margins, strong liquidity position, and lower leverage, since 2017,” Fitch said.
Over the past five years, net adjusted debt to adjusted funds available for debt service has declined from approximately 6x to approximately 4.6x, as the utility “has demonstrated significant resilience in demand and financial performance following disruptions from Hurricane Irma in late 2017, impact of the coronavirus pandemic in 2020, and inflationary pressures felt in 2022.”
The rating also considers “the system’s strong revenue defensibility underpinned by the highly monopolistic nature of its revenue source, independent legal ability to raise rates, and favorable demographic trends within its service area,” Fitch said.
The utility’s strong operating risk profile is based on the system’s access to a diverse resource base as an all-requirements member of the Florida Municipal Power Agency and a low operating cost burden, and also factors the system’s isolated geographic location and related risks, Fitch said.
City Utilities of Springfield, Mo., Awarded $10 Million for Natural Gas Infrastructure Projects
April 24, 2023
by Paul Ciampoli
APPA News Director
April 24, 2023
City Utilities of Springfield, Mo., has been awarded $10 million from the U.S. Department of Transportation and Pipeline and Hazardous Materials Safety Administration to partially fund a pipeline replacement project.
City Utilities is one of 37 utilities, in almost 20 states, that will receive a portion of the nearly $200 million in grant funding through the PHMSA program.
“This funding will allow CU to more rapidly replace aging natural gas infrastructure in the Zone 1 area of Springfield where older natural gas mains are scheduled for replacement,” said Gary Gibson, President and CEO of City Utilities of Springfield. “The safety and reliability of the natural gas system is critical, and the ability to replace mains without additional costs for our customers is an economical benefit for the entire community.”
PHMSA grant funding will allow CU to replace approximately 11 miles of legacy gas main and associated services in the Zone 1 area of the service territory.
CU will apply for additional funding to continue the replacement project in several Zone 1 locations of Springfield. Work on the project is expected to begin during the last quarter of 2023.