MINUTES FOR THE STUDY SESSION MEETING
ASHLAND CITY COUNCIL
January 19, 2000
Council Chambers, 1175 E Main
CALL TO ORDER
Mayor Shaw called the meeting to order at 12:00 p.m. in the Council Chambers at 275 E Main.
Councilors Laws, Reid, Hauck, Wheeldon and Fine were present. Staff present: Assistant City Administrator Greg Scoles, Finance Director Jill Turner and Administrative Services Director Dick Wanderscheid.
1. Discussion regarding Electric/Telecommunications Department philosophy for providing Ashland Fiber Network services within the Ashland area.
Director of Electrical Utilities Pete Lovrovich explained that the primary cost for the network is the portion of hardware that lies within the community. He stated that there is an interest by individuals that live adjacent to the urban growth boundary for Ashland Fiber Network services. Lovrovich stated that these individuals have inquired for services both for business and personal use. He noted that the city is providing electric services to some individuals adjacent to the urban growth area and that it would be natural to offer AFN services.
Council discussion on the merits of offering this service to individuals who are not residents of the City of Ashland. Discussed examples of providing city electrical services to individuals who live outside the city limits.
Council discussed the issue of how this may encourages urban sprawl by providing city services outside the city limits. Councilor Reid felt that there is an opportunity to benefit the whole community by offering these services and stated that she would like to see something worked out that would encompass some of the issues surrounding urban sprawl. It was noted that the city does provide electrical services to the urban growth boundary.
Shaw voiced her concern with urban sprawl and felt that if other cities are offered the AFN services, that it would be wise to ask that this service be limited to their city limits only. Shaw questioned just how much you want to encourage urban growth and voiced concern with these property owners not paying city taxes. Fine suggested pursuing a franchise agreement with the City of Talent to provide telecommunications services.
Laws suggested that consideration could be made for homes that are existing and not allow service for new construction.
Hauck noted that offering these services may have a greater impact than what is expected, but feels that consideration may be okay for existing home owners.
It was suggested that a policy be drafted that would deal with providing services inside and outside the city limits for the council to discuss. Noted the need to look at all of these concerns.
Lovrovich explained that an initial plan was to use a US West link until the system could become self sufficient. Noted that Asante in Medford has approached the city for a connection, and they are willing to extend their own fiber to the nearest city fiber for a connection, and pay the fees. Noted that both Talent and Phoenix have also expressed interest in connections for their city functions.
Council consensus that providing services to other entities inside city limits -- whether it's the City of Medford or the City of Talent, as long as it is within the city limits -- and does not affect the level of service to citizens of Ashland, would be agreeable to them.
Council requested that staff put together a proposed policy for council consideration.
Lovrovich stated that television and internet services will be available and offered on February 1, 2000 in four nodes. He explained that a press release will be distributed to advise the community of expected service dates by area. In addition, an updated information piece will be prepared to indicate the status of AFN service for the various nodes.
2. Presentation by Bonneville Environmental Foundation regarding Environmentally Preferred Power options available to Northwest Utilities (Green Power)
Angus Duncan and John Lebens, Account Executive for BPA made a presentation to the council. Lebens explained that Environmentally Preferred Power (EPP) is produced by renewable resources and has minimal impact on the environment. He explained that BPA manages an inventory of EPP resources and that the resources are endorsed by environmental groups as clean. Lebens stated that EPP is all but offering choice and this would enable BPA power customers to support renewable development.
Lebens explained that the inventory of EPP resources is growing, and is currently made up of wind and hydro. He stated that future additions may include solar (Ashland), geothermal and additional wind. He explained several projects currently in the inventory. Duncan explained how "bird kill" is minimized at hydro projects. Lebens noted the groups that endorse Bonneville' EPP resources as an "Environmentally Preferred Source of Power."
Lebens raised questions as to why the city may want to choose EPP as part of their resource portfolio and noted the benefit from improved air quality and fish and wildlife habitat. He explained that there is an increasing number of customers that want a choice and that utilities and customers want power from environmentally friendly resources and are willing to pay more for it. He noted several utilities that are already offering EPP or "green" power.
The environmentally preferred power costs $35.75 per megawatthour and $15.70 per megawatthour more than a flat block of Priority Firm Power. Lebens explained that 60% of the money goes to the Bonneville Environmental Foundation for new renewable energy and fish and wildlife projects, and noted that 40% of the money is used to cover BPA project costs and to invest in new projects. He stated that the cost of new renewable resources like wind, geothermal or solar photovoltaic is at least $45.00 per megawatthour.
Lebens gave some reasons to consider buying BPA's "Green" power: it is endorsed by Northwest environmental groups, so it is the real thing; there are flexible amounts and contract lengths available to allow customers to test customer preferences to fit budgets; there are a variety of resources to help keep costs down; and revenues are invested in new projects.
Lebens pointed out that Ashland has one of the best records in the region for marketing energy efficiency and renewables. He stated the BPA needs the participation of Ashland to help expand this market. He explained that customer demand will enable future new renewable projects.
Duncan explained the Bonneville Environmental Foundation and gave a brief history of the foundation. He stated that the Board and staff have raised around $2.5 million to cover administrative costs, and the will be reinvested in the foundation. He commented on three projects that are currently underway. Two are watershed restoration projects in the Chinook River and Mohawk River Partnership and the third is the Solar Ashland project. He requested the city's assistance in finding the best renewable energy and watershed restoration ideas that can help turn into real projects with enduring environmental benefits. Duncan commented on the need to bring costs down and to share the nation's resource mix which would make economic sense, not just environmental sense.
Council discussed the incentive for customers to use "green" power and what the assurances would be that the coal-fire plants will be taken off-line eventually. Laws emphasized that the more green power generated and used, the better the total mix will be. Explained that natural gas is being used now in place of coal, and no new coal generation plants are being constructed. Emphasized that not to far down the line, even wind power may reach a point where it is cost competitive with coal generated power.
Duncan explained that in central California, there are wind farms that originally were placed outside the city limits but over time the cities have grown toward and around the farms. Noted that the farms in Oregon and Wyoming are in areas far from cities.
Discussion of hydro-projects in watershed areas and the criteria for placement of these projects. Duncan explained that he was not aware of any testing for geothermal in the Ashland area. Wanderscheid commented that some testing had been previously done for geothermal in this area with minimal results. Lovrovich noted the possibility for using the existing Reeder Gulch hydro project to generate nearly 1 megawatt of green power. Lebens explained that Buckhorn Springs will also be used to generate green power.
Duncan briefly explained that in the coming years, green power to be generated will be geothermal, solar, some landfill gas and biomass products.
Duncan commented on the importance of Ashland's participation and stated that Ashland is one of the leaders in environmental efficiency. He stated that their goal is to produce renewable resources in the region using the leadership qualities of Ashland. He felt that Ashland's involvement would be reassuring to other communities.
Lovrovich explained that staff would look at what the annual overall expense may be for the preferred power plan, and provide a variety of scenarios to pay for the additional expense (rate-based, volunteers, percentages of green power) and make this program viable. Discussed what has been done in other communities to introduce green power.
Wanderscheid explained that information from a previous survey could be used in preparing information for council to consider in deciding whether to provide this service. Noted that while there has been a strong expression of support for the program in surveys, it may be less so when people actually have to pay to express their support.
Reid would like to look at phasing in a rate-based option, and also committing to more than one year to get a better rate. Suggested rate basing a certain level of the program, while giving customers the option to pay for an increased percentage of green power. Wanderscheid confirmed that Bonneville would give a better price if the city bought on a longer term contract
Fine voiced concern, and suggested making the City's own turbine environmentally acceptable. Questioned whether the environmental community could serve as salesmen in a sense, by encouraging people to pre-sign for the service. The City would then commit to the green power purchase once pre-signs reached a certain level.
Lovrovich explained that staff will be pursuing the Reeder Gulch option, but that there are issues including fish passage that must be addressed. Fine emphasized that a City-owned facility should not be harming the environment in any way.
Wanderscheid explained that no one believes the generator is harming the environment, but that the issue of getting it certified as "green" involves certifying the entire reach of the stream. Explained further that a BPA expert had looked at the facility and felt it was fish friendly, but stated that there were problems in the lower reaches of the stream.
Wanderscheid emphasized concern for charging more for a green power source that is city-controlled, and suggested that instead there would likely be an exchange with BPA's foundation.
Wanderscheid noted that the response to the solar pioneer program will be an indicator of what sort of support there is in the community for the program. Discussed the council's desire to work locally on the solar program as well as regionally to support the push for green power.
Shaw concerned with any general increase in the utility rate being perceived as a way to augment the fledgling AFN system which is perceived as some as being unable to sustain itself. Suggested that any rate increase should be voluntary.
Stated that staff will bring back a set of options with costs and benefits to a future meeting for council consideration.
ADJOURNMENTThe meeting was adjourned at 1:50 p.m.
Submitted by Barbara Christensen, City Recorder/Treasurer