Apr 11, 2023 Austin Energy Utility Oversight Committee

[00:00:02]

I'M LESLIE POOL.

[CALL TO ORDER]

AND, UM, I'D LIKE TO CALL THIS MEETING OF THE OVERSIGHT COMMITTEE TO ORDER.

IT IS TUESDAY, APRIL 11TH, 2023.

THE TIME IS 9:04 AM IT LOOKS LIKE I HAVE A QUORUM ON THE DIAS.

UH, COUNCIL MEMBERS, ALISON ALTER VELASQUEZ, MAYOR WATSON COUNCIL MEMBERS, UM, UM, CADRE FUENTES, KELLY AND MAYOR PROTE ELLIS.

UH, DO WE HAVE ANYBODY ON THE SCREEN REMOTE? AND I SEE COUNCIL MEMBER RYAN AL ALTER HAS JOINED US AS WELL.

SO, WELCOME EVERYONE.

UM, CALLED THIS MEETING TO ORDER.

AND I UNDERSTAND WE HAVE NO SPEAKERS TODAY FOR PUBLIC COMMUNICATION, IS THAT CORRECT? THANK YOU.

SO OUR

[Approval of Minutes]

AND I SEE A MOTION FROM COUNCIL MEMBER FUENTEZ AND A SECOND BY MAYOR PROTE ELLIS.

UM, ARE THERE ANY OBJECTIONS TO ADOPTING THE MINUTES AS SUBMITTED? HEARING NONE THESE, UM, MINUTES ARE ADOPTED.

WE HAVE A COUPLE OF DISCUSSION ITEMS, OR ONE DISCUSSION

[2. Discussion regarding committee and Council process for agenda items from Council members relating to Austin Energy]

I WANTED TO, UM, INTRODUCE AND KIND OF FRAME THE FIRST DISCUSSION ITEM, WHICH RELATES TO COMMITTEE AND COUNCIL PROCESS FOR AGENDA ITEMS HERE IN THIS COMMITTEE AND HOW WE MAY USE THIS COMMITTEE GOING FORWARD.

SO I JUST WANTED TO GIVE YOU A LITTLE BIT OF BACKGROUND ON TWO NEW TOPICS THAT I'LL BE INCLUDING ON OUR AE UOC AGENDAS GOING FORWARD.

FIRST, YOU'LL SEE A NEW AND RECURRING ITEM ON THE AGENDA TO CREATE SPACE FOR US TO DISCUSS ISSUES OR QUESTIONS THAT, UH, COUNCIL MEMBERS MAY HAVE, INITIATIVES YOU MAY BE THINKING ABOUT BRINGING FORWARD.

WE WON'T TAKE UP ANY ITEMS SPECIFICALLY TODAY.

WHAT I INTEND FOR THIS ITEM IS SIMPLY TO LAY OUT AND EXPLAIN THE NEW ADDITION OF THIS ITEM.

UM, AND IT'S IN ADDITION TO WHAT WE TYPICALLY HAVE ON OUR OVERSIGHT COMMITTEE AGENDA TO GIVE YOU A LITTLE BIT MORE CONTEXT PUBLICLY.

SO, AS WE KNOW, RESOLUTIONS RELATING TO MUNICIPALLY OWNED UTILITIES CAN BE NOTABLE AT THE STATE LEVEL.

FOR EXAMPLE, ABOUT A DOZEN BILLS RELATING TO AUSTIN ENERGY ARE CURRENTLY FILED AT THE LEDGE.

SOME OF YOU MAY BE PLANNING NEW RESOLUTIONS.

SO I WANNA CREATE A SPACE HERE WHERE WE CAN PUBLICLY SHARE IDEAS AND ASK QUESTIONS AND LEARN FROM STAFF WHETHER AN IF C MIGHT DIRECT THINGS OUR STAFF ARE ALREADY DOING OR POSSIBLY PLANNING TO DO.

AND SO YOU COULD LOOK AT THIS AS A BROADENING OF THE STANDARD FUTURE ITEMS AGENDA, UH, LISTING.

AND I HOPE TOO THAT WITH OUR NEW ACTION ORIENTED CITY MANAGER, THE CONCERNS WE EXPRESS IN OUR OVERSIGHT COMMITTEE MEETINGS CAN BE HANDLED IN A WAY THAT MAY MINIMIZE THE NEED FOR RESOLUTIONS AND, AND MAKE OUR PROCESSES MORE AGILE AND MAYBE EVEN STREAMLINED.

AND BECAUSE I HAVE BROUGHT SEVERAL RESOLUTIONS THIS YEAR MYSELF, FOR EXAMPLE, RELATING TO CREATING A BATTERY REBATE PROGRAM AND EXPANDING THE NUMBER AND LOCATIONS OF EV CHARGING STATIONS, I PROPOSE CREATING A SECOND RECURRING AGENDA ITEM.

THE FOCUS IS ON INNOVATIONS THAT AUSTIN ENERGY IS WORKING ON.

SO WE HAVE A NEAR HORIZON ON EXCITING NEW SOLUTIONS TO OUR ENERGY AND ENVIRONMENTAL CONCERNS.

I EXPECT AE TO LEAD THE CONVERSATION ON THESE ISSUES AND DEMONSTRATE ONE OF THE CITY'S CORE STRENGTHS, WHICH IS CREATIVITY AND INNOVATION IN PROGRAMMING.

AND I INTEND THESE CONVERSATIONS TO MOVE US FORWARD, PERHAPS EVEN MORE NIMBLY SAVING TIME, AND ALSO REDUCING THE NUMBER OF RESOLUTIONS TO PROMPT OR PROMOTE INNOVATIVE SOLUTIONS FROM OUR PROFESSIONAL STAFF INSTEAD, AND IDEALLY, OUR SUBJECT MATTER EXPERTS WILL GET THERE.

BEFORE WE DO SO, I'D LIKE TO PROPOSE THAT WE GIVE THIS A TRY IN THE COMING MONTHS.

I DON'T SEE IFCS BEING ELIMINATED AT ALL.

PLEASE DO PROCEED AS YOU AND YOUR STAFF DESIRE, BUT I DO ASK THAT WE MAKE USE OF THE COMMITTEE PROCESS FOR SOME OPEN DIALOGUE ABOUT INITIATIVES THAT WE'RE INTERESTED IN OR ARE PROPOSING.

AND SO I'LL OPEN THE CONVERSATION TO MY COLLEAGUES ON THE DIOCESE TO SEE IF THERE'S ANY QUESTIONS ON THE PROCESS OR HOW WE CAN MAKE IT MORE EFFICIENT.

UM, IN THE BACKUP, YOU'LL SEE AN UPDATED LIST OF IFCS CURRENTLY RELATING TO AUSTIN ENERGY.

YES.

COUNCIL MEMBER FUENTES.

THANK YOU.

THANK YOU, CHAIR.

PAUL, I GUESS MY QUESTION WOULD BE, IS THIS A POLICY? AND I APPRECIATE YOU PROPOSING THIS FOR AUSTIN ENERGY.

UM, WOULD THIS BE A POLICY THAT

[00:05:01]

OKAY.

UM, AND SO I GUESS THE OTHER QUESTION I HAVE IS, SO WE WOULD PUT FORTH A POLICY ON THE NEXT MONTH'S AGENDA THAT IF IT'S RELATED TO AUSTIN ENERGY, HOW MANY, WE WOULD JUST NEED ONE OTHER CO-SPONSOR TO GET ON THE COMMITTEE AGENDA.

IS THAT RIGHT? THAT'S CORRECT.

NO, ACTUALLY THAT'S NOT CORRECT.

WE HAVE THREE SPONSORS FOR AUSTIN ENERGY, BECAUSE IT'S A COMMITTEE OF THE WHOLE AND TWO SPONSORS IS FOR THE SMALLER COMMITTEES, WHICH ARE, UM, FOUR OR FIVE MM-HMM.

.

AND THIS ONE, BECAUSE IT WAS A COMMITTEE THE WHOLE, A FEW YEARS AGO, WE CHANGED THE NUMBER OF, UM, CO-SPONSORS TO THREE.

OKAY.

THANK YOU MAYOR.

IN, IN SOMEWHAT OF A RESPONSE TO, UH, COUNCIL MEMBER FUENTES.

ONE THOUGHT HAS BEEN, UH, AND I, BECAUSE OF, I DIDN'T HAVE TIME TO DO IT TODAY, BUT ONE THOUGHT THAT HAS THAT I'VE HAD TO HELP WITH COUNCIL MEETINGS WOULD BE THAT WE, WE UTILIZE WORK SESSIONS.

WE'RE GONNA GO INTO A WORK SESSION RIGHT AFTER THIS.

WE USE WORK SESSIONS, WE UTILIZE THOSE SO THAT WE CAN ANNOUNCE ITEMS THAT WE PULL FOR THE COUNCIL MEETINGS AND GET THAT STARTED.

YOU KNOW, I WANT, YOU KNOW, SOMEBODY SUGGESTS I'M GONNA HAVE AN AMENDMENT TO THIS, AND SO, UH, I, I WANNA BRING IT UP HERE, AND THEN WE CAN SET SOME TIMES, GRANTED, SOME DAYS YOU'RE GONNA HAVE THINGS ALL THE WAY TO THE COUNCIL MEETINGS, AND THAT, THAT'S NOT TO WIPE THAT THAT OUT, BUT IT MIGHT JUST SET UP A MORE EFFICIENT FASHION.

AND THE THOUGHT WAS THAT WHAT WE COULD USE WOULD BE COMMITTEE MEETINGS TO HAVE THINGS LIKE BRIEFINGS, UH, SO THAT YOU WOULD SPEND LESS TIME, UH, WORK SESSION.

THE WORK SESSION WOULD BE A WORK SESSION TO PREPARE FOR THE COUNCIL BRIEFINGS WOULD GO TO COMMITTEES WHERE YOU WOULD HAVE A FULL BRIEFING AND EVERYBODY WOULD KNOW, UH, WHAT THEY ARE.

SO IF A COUNCIL MEMBER WANTED TO COME, BUT YOU WOULD UTILIZE THOSE COMMITTEES AND THOSE THAT ARE CHAIRS OF THOSE COMMITTEES WOULD BE IN A BETTER POSITION TO HELP SET, SET, UM, AGENDAS IN THAT WAY.

SO I, I, I'VE ACTUALLY DRAFTED THE MESSAGE BOARD POST ON THAT.

WASN'T ANTICIPATING THE QUESTION TODAY, BUT, UM, BUT I, I WANTED TO WAIT BECAUSE I HAVE TO LEAVE, I MAY HAVE TO LEAVE IN THE MIDDLE OF THE, OF THE WORK SESSION TO GO TAKE CARE OF SOMETHING AT THE CAPITOL, BUT START THAT MAYBE NEXT WEEK, BUT START LOOKING AT THE COMMITTEES AS A MEANS TO BRING THOSE BRIEFINGS THROUGH.

UM, SO BACK TO YOUR POINT, COUNCIL MEMBER KELLY.

THANK YOU.

UM, I, I REALLY LIKE THE IDEA OF BRINGING MORE OF OUR WORK TO COMMITTEES AND UTILIZING THAT AS A WAY MOVING FORWARD.

AND CHAIR, I JUST WANNA SAY THANK YOU FOR BRINGING THIS TO THE AGENDA TODAY.

IT'S ESPECIALLY HELPFUL IN THESE MEETINGS THAT WE HAVE AUSTIN ENERGY EXPERTISE WITH US, SO THAT WHEN WE DISCUSS THESE ISSUES, THEY'RE READILY AVAILABLE.

THANK YOU.

APPRECIATE THAT.

ANY OTHER COMMENTS? YES, COUNCIL MEMBER RYAN AL ALTER, JUST ONE KIND OF AS WE DO THIS, UM, I REMEMBER TALKING TO MY STAFF A LITTLE WHILE AGO ABOUT SOME OF THESE ISSUES, AND ONE OF THE THINGS THAT WE HAD DISCUSSED IS JUST THAT SOME DEPARTMENTS DON'T REALLY HAVE A HOME IN COMMITTEES MM-HMM.

.

AND SO JUST MAKING SURE THAT, LIKE THE PARKS DEPARTMENT FOR INSTANCE, WHERE WOULD WE HAVE THAT DISCUSSION? UM, AND I, I KNOW I'M NOT OFFERING ANYTHING NEW, BUT JUST AS WE THINK THROUGH THIS NEW POTENTIAL PROCESS, WE THINK ABOUT ALL OUR DEPARTMENTS THAT DON'T NATURALLY FIT IN CERTAIN COMMITTEES.

YEAH, THAT'S RIGHT.

AND THAT WAS, UM, YOU'VE HIT ON SOMETHING THAT IS, IS PRETTY CLEAR AND PRETTY OBVIOUS.

AND, AND SO I WOULD SAY THAT, THAT HOW WE ARE HANDLING ISSUES THAT DON'T HAVE A NATURAL OR SPECIFIC HOME IN A COMMITTEE WOULD CONTINUE AS, AS THEY ARE.

I, I DON'T SEE, UM, INITIALLY WE HAD CREATED 10 COMMITTEES TO COVER ALMOST EVERY, IF NOT EVERY DEPARTMENT THAT WAS IN THE CITY AND PARKS OPEN SPACE AND SUSTAINABILITY WAS ONE OF THOSE COMMITTEES.

AND, UM, WHEN WE WERE FORMED THE NUMBER DOWN FROM 10 TO ABOUT SIX OR SEVEN, UM, I GUESS ABOUT TWO YEARS AFTER WE HAD CREATED IT, WE ELIMINATED SOME OF THOSE COMMITTEES.

AND THAT WAS ONE OF THEM.

THAT, THAT WORK HAS CONTINUED A PACE.

AND I WOULD ARGUE THAT IT WASN'T, IT WASN'T HARMED BY LOSING THAT.

UM, IN, IN THE CASE OF SOME OF THESE MORE TECHNICAL COMMITTEES WHERE THE EXPERTISE OF OUR STAFF IS CLEARLY AT THE FORE, I REALLY DID WANT TO BRING THE CONVERSATION MORE PUBLICLY SO THAT PEOPLE COULD HEAR, UH, THE VARIOUS THINGS THAT WE'RE CONSIDERING AND TALKING ABOUT.

AND IT, IT MAY AID IN SOME PUBLIC UNDERSTANDING, UM, ELSEWHERE AT SOME OTHER LEVELS OF GOVERNMENT OF THE WORK THAT WE'RE DOING HERE.

I HAVE ONE MORE.

YES.

COUNCIL MEMBER FUENTES.

THANK YOU CHAIR.

AND, AND, AND I, I SUPPORT US, UM, GOING

[00:10:01]

I'M A FIRM BELIEVER IN ITERATIVE PROCESSES, UH, BUT I STILL WANNA KEEP OPEN THE OPTION THAT WE HAVE THE LEGAL ABILITY TO STILL BRING FORWARD AN ITEM TO COUNSEL THROUGH OUR REGULAR COUNCIL AGENDA.

THIS IN NO WAY WOULD IMPEDE OR INTERPOSE ITSELF BETWEEN THAT AND, AND OUR REGULAR PROCESSES.

THANK YOU.

THAT'S CORRECT.

MAYOR, WAS THERE SOMETHING ELSE YOU WANTED? YEAH, BUT I THINK COUNCIL MEMBER ALISON MALTER HAD HER HAND.

YES.

COUNCIL MEMBER ALISON MALTER THANK YOU.

UM, I JUST WANTED TO, UM, FLAG THAT FOR AUDIT AND FINANCE, WE ARE ALREADY MEETING EVERY MONTH AND WE HAVE A PACKED AGENDA.

WE HAVE MULTIPLE DEPARTMENTS THAT ARE FEEDING IN THAT, SOME OF WHICH, UM, BY CODE HAVE TO COME TO US AND OTHER THINGS.

SO, UM, WE WOULD HAVE TO HAVE THE COMMITTEE BE WILLING TO MEET LONGER OR MORE IN ORDER TO BE ABLE TO ACCOMMODATE MORE AND MORE BRIEFINGS OR TO MAKE THE SPACE FOR THAT, WHICH WE CERTAINLY CAN DO.

UM, BUT IT, WE JUST HAVE TO BE UNDERSTANDING THAT THAT IS GOING TO HAVE TO HAPPEN BECAUSE WE HAVE TOO MANY, YOU KNOW, AS IT IS, WE ARE, WE ARE ALREADY AGENDA OUT THREE OR FOUR MONTHS IN ADVANCE, UM, FOR THAT PARTICULAR COMMITTEE, WHICH COULD TAKE, DEPENDING ON HOW YOU DEFINE WHAT GOES TO WHAT COMMITTEE COULD TAKE A LOT OF, UM, THE WORK.

AND SO WE SHOULD JUST BE MINDFUL OF THAT IF WE'RE GONNA MOVE TO THAT, THAT WE ARE GOING TO NEED TO, UM, THINK A LITTLE BIT DIFFERENTLY ABOUT HOW WE DO THAT WORK MOST EFFECTIVELY, MAYOR, AND THAT'S VERY CLOSE TO WHAT I WAS GETTING READY TO SAY.

LOOK, THIS, THIS COUNCIL IS WORKING, IT SEEMS TO ME WORKING VERY WELL AND DIFFERENTLY AS A TEAM ON A VARIETY OF ISSUES.

IN ADDITION TO THAT, WE HAVE A, A NEW CITY MANAGER, AN INTERIM CITY MANAGER THAT IS APPROACHING THINGS IN A DIFFERENT WAY THAN WHAT SOME HAVE GREW ACCUSTOMED TO PREVIOUSLY.

SO WE'RE KIND OF AT A DIFFERENT PITCH POINT.

AND WHAT THAT MEANS, I THINK, IS THAT WE, WE DON'T NEED TO DO COMMITTEES NECESSARILY EXACTLY THE SAME.

AND THAT WOULD RAISE ISSUES LIKE THAT IF WE, IF WE, IF WE TRY TO DO SOMETHING DIFFERENT BUT STILL TREAT THE COMMITTEES EXACTLY THE SAME.

WE'RE GOING TO RUN INTO, TO ISSUES LIKE, UH, COUNCIL MEMBER ALLISON ALTER JUST BROUGHT UP.

SO, SO THE THOUGHT PROCESS THAT I THINK, UH, CHAIR POOL HAS LAID OUT WELL FOR THIS COMMITTEE IS THAT, AND, AND, AND TO FOLLOW UP ON COUNCILMAN RYAN AL ALTER'S COMMENT AS WELL, IT MAY BE THAT WHAT WE WANT TO DO IS HAVE COMMITTEE X BECOME COMMITTEE X AND Y, SO THAT YOU DO HAVE, IF WE WANT TO DO, DO IT THROUGH COMMITTEES OR WE MAY EXPERIMENT WITH SOME OF THOSE COMMITTEES, JUST STAY IN WITH THE COUNCIL AS A WHOLE.

THIS OUGHT TO BE, BECAUSE THE WAY THE COUNCIL'S WORKING TOGETHER AND WORKING WITH THIS MANAGER, I THINK THIS OUGHT TO BE AN EXPERIMENTAL PROCESS TO GET US AT OUR MOST EFFICIENT.

AND, UH, SO I'M GLAD YOU'RE PILOTING THIS AND THE, THE, WHEN YOU HAVE IDEAS LIKE THIS, PUT 'EM ON THE MESSAGE BOARD AS SUGGESTIONS AND, AND ALLOW FOR THAT COMMENT SO THAT WE CAN, WE CAN MAKE IT WORK BETTER.

AND, AND, UH, AND, AND RU NOT HAVE THE KINDS OF PROBLEMS THAT WE KNOW WILL HAPPEN IF, IF WE TRY TO DO THE SAME OLD BUT YET BRING ABOUT CHANGE.

ANY OTHER COMMENTS? I REALLY APPRECIATE THE INPUT FROM YOU ALL AND, AND LOOK FORWARD TO GIVING THIS A TRY AND, AND WE'LL SEE WHERE WE'RE AT.

AND ALSO TO KIND OF HAVE AN OPEN MIND AND, UH, TO BE FLUID WITH THE COMMITTEES AND WITH THE POINT BEING EFFICIENCIES AND REALLY GETTING GOOD WORK DONE AND, AND BEING AS TRANSPARENT AND OPEN TO THE PUBLIC AS WE POSSIBLY CAN.

GREAT.

THANK YOU ALL SO MUCH.

APPRECIATE THAT.

WE'LL GO NOW TO OUR BRIEFINGS AND I THINK OUR INTERIM GENERAL MANAGER, STUART RILEY,

[3. General Manager’s Report - Upcoming Recommendations for Council Action, events, awards.]

GOOD MORNING, STEWART.

I HOPE ALL AS WELL.

THANK YOU, CHAIR.

GOOD MORNING.

UM, CHAIR, VICE CHAIR COMMITTEE MEMBERS.

I'M STUART RILEY, INTERIM GENERAL MANAGER OF AUSTIN ENERGY.

AND BEFORE I GET INTO THE, THE SLIDES THIS MORNING FOR THE GENERAL MANAGER'S REPORT, I WOULD JUST LIKE TO ACKNOWLEDGE THE IMPORTANT WORK WE HAVE AHEAD OF US AT AUSTIN ENERGY, WORKING WITH ALL OF YOU AND WORKING WITH THE CITY OF AUSTIN AS A WHOLE.

OUR MISSION AT AUSTIN ENERGY IS TO SAFELY DELIVER CLEAN, AFFORDABLE, RELIABLE ENERGY AND EXCELLENT CUSTOMER SERVICE.

BUT WE ALSO KNOW WE NEED TO BE RESILIENT.

GRID RESILIENCE IS ONE OF OUR SIX STRATEGIC GOALS AT AUSTIN ENERGY, AND WE ARE WORKING TO DO BETTER TO THE CITY COUNCIL, TO OUR CUSTOMERS, AND TO THE PUBLIC AT LARGE.

WE HEAR YOU, WE HEAR YOUR CONCERNS ABOUT AUSTIN ENERGY NEEDING TO BE A MORE RESILIENT UTILITY SO THAT WE CAN HAVE A MORE RESILIENT COMMUNITY.

WE ARE WELL UNDERWAY

[00:15:01]

UM, BUT I'D JUST LIKE TO COMMIT TO YOU RIGHT NOW THAT WE ARE ENGAGING IN AN OPEN, HONEST, AND COMPLETE AFTER ACTION REVIEW PROCESS DESIGNED TO LOOK AT EVERYTHING RELATED TO OUR OPERATIONS DURING WINTER STORM MARA, WITH THE INTENT OF FINDING WHAT WE CAN LEARN FROM AND IMPROVE UPON.

AT THE END OF THAT PROCESS, WE WILL IMPLEMENT ACTIONS THAT WILL MAKE US BETTER EQUIPPED FOR THE SEVERE WEATHER WE ARE SEEING MORE AND MORE OFTEN AS A RESULT OF CLIMATE CHANGE.

AND AUSTIN ENERGY HAS AN IMMENSE RESPONSIBILITY OF POWERING EVERYTHING THAT HAPPENS IN OUR CITY AND IN THE SURROUNDED COMMUNITIES THAT WE SERVE.

AND WE ARE DEDICATED TO SERVICE.

WE TAKE THAT RESPONSIBILITY VERY SERIOUSLY.

WE ARE PASSIONATE ABOUT RELIABILITY, AND WHEN WE DON'T MEET CUSTOMER EXPECTATIONS AND WE DON'T MEET THE COUNCIL'S EXPECTATIONS, UM, WE ARE COMMITTED TO DOING BETTER.

SO THANK YOU CHAIR AND I WILL MOVE ON TO MY SLIDES.

THE FIRST ITEM IS A, AN ITEM ON THE COUNCIL AGENDA FOR THIS WEEK.

IT'S ITEM 21, A DESIGN BUILD AGREEMENT NOT TO EXCEED 34 MILLION FOR THE BRACKENRIDGE GAS INSULATED SWITCH GEAR SUBSTATION.

THIS SUBSTATION IS A KEY COMPONENT OF OUR REPOWERING DOWNTOWN INITIATIVE, WHICH IS AIMED AT IMPROVING UPON THE RELIABILITY, RESILIENCY, AND CAPACITY TO MEET OUR GROWING CUSTOMER NEEDS.

UM, YOU'LL HEAR IN A LITTLE BIT, UH, ABOUT ANOTHER COMPONENT OF OUR REPOWERING DOWNTOWN INITIATIVE, WHICH IS THE RECENTLY COMPLETED RAINY STREET SUBSTATION.

THE OTHER ITEM I'D LIKE TO HIGHLIGHT FOR YOU TODAY IS ON THE APRIL 20TH AGENDA THAT R C A IS TO APPROVE THE AGGREGATE ANNUAL REBATE APPROVAL FOR ENERGY EFFICIENCY REBATES FOR MULTI-FAMILY AND COMMERCIAL PROPERTY REBATES FOR A COMBINED AMOUNT OF $6 MILLION.

WE PROVIDE THESE INCENTIVES TO REDUCE ENERGY, DEMAND AND ASSOCIATED COSTS, THEREBY BENEFITING ALL CUSTOMERS.

SO FOR MULTI-FAMILY PROPERTIES THAT GO THROUGH THIS PROCESS, TYPICALLY EACH UNIT GETS THREE ENERGY EFFICIENCY MEASURES.

THAT CAN BE HVAC, TUNE-UPS, SOLAR SCREENS, UH, SMART THERMOSTATS, AND ENERGY EFFICIENCY LIGHTING, ENERGY EFFICIENT LIGHTING.

AND THIS AGGREGATE ANNUAL APPROVAL PROCESS WAS DEVELOPED A FEW YEARS AGO IN RESPONSE TO OUR CUSTOMER'S CONCERNS ABOUT BEING MORE, UM, AGILE AND QUICK WITH PROVIDING THE REBATE FUNDS.

AND SO THIS WAY WE DON'T HAVE TO COME BACK TO COUNCIL EACH TIME A REBATE EXCEEDS OUR ADMINISTRATIVE SPENDING AUTHORITY.

I'D ALSO LIKE TO POINT OUT THAT ON THAT AGENDA ITEM, THE 6 MILLION INCLUDES RATIFICATION OF THE REBATES ISSUED SO FAR THIS YEAR AS WE MISSED BRINGING THIS FORWARD TO COUNCIL AT THE START OF THE FISCAL YEAR 23.

AND WE WILL BE BRINGING THIS WITH THE ANNUAL BUDGET GOING FORWARD TO PREVENT A SIMILAR OVERSIGHT IN THE FUTURE.

NEXT SLIDE.

UM, SPEAKING OF ENERGY EFFICIENCY, FOR THE SIXTH YEAR IN A ROW, AUSTIN ENERGY HAS BEEN PRESENTED BY THE EPA WITH THE AWARD FOR ENERGY STAR PARTNER OF THE YEAR FOR SUSTAINED EXCELLENCE.

THIS IS ENERGY STAR'S, HIGHEST HONOR AUSTIN ENERGY'S 2023 ACHIEVEMENTS.

WERE FOR OUR TWO WHOLE HOME ENERGY EFFICIENCY PROGRAMS. THAT'S THE ENER HOME PERFORMANCE WITH ENERGY STAR PROGRAM AND OUR WEATHERIZATION ASSISTANCE PROGRAM FOR QUALIFYING LOW TO MODERATE INCOME CUSTOMERS.

WE REMAIN FOCUSED ON ENERGY EFFICIENCY AND LOWERING CUSTOMER BILLS.

PART OF WHY WE HAVE SOME OF THE LOWEST BILLS IN THE STATE, AND I'M PROUD OF OUR AUSTIN ENERGY TEAMS FOR THE WORK THEY'VE DONE.

THAT'S ONCE AGAIN BEEN RECOGNIZED.

NEXT SLIDE, PLEASE.

AND FINALLY, I HAVE A VERY SHORT VIDEO TO SHOW, UH, REGARDING THE COMPLETION OF THE RAINY STREET SUBSTATION.

AS I MENTIONED EARLIER, THIS IS PART OF OUR REPOWERING DOWNTOWN INITIATIVE.

AND, UM, THIS VIDEO GETS INTO A LITTLE BIT ABOUT THE PROJECT AS WELL AS THE COMMUNITY ENGAGEMENT PROCESS FOR THE RAINY STREET DISTRICT.

AND HOPEFULLY THAT'S GONNA WORK.

WELL, WE WILL SEND THE LINK OUT TO ALL OF YOU.

UM, BUT BASICALLY WHAT WE, WE DID FOR THAT SUBSTATION IS WE ENGAGED IN A COMMUNITY ENGAGEMENT PROCESS WITH THE NEIGHBORHOOD TO MAKE SURE THAT THE, THE FEATURES OF THAT SUBSTATION INCLUDED, UH, PUBLIC ART, UM, ENVIRONMENTAL FEATURES, INCLUDING CHARGING STATIONS.

AND THERE WAS A ROBUST PROCESS OF WORKING WITH THE COMMUNITY TO MAKE SURE THAT IT HAD ALL THE FEATURES AND FIT IN NICELY IN WITHIN THE RAINY STREET DISTRICT BECAUSE WE REALIZED THAT THAT'S IN A, A CORE AREA OF OUR CITY AND, UM, NEEDED TO FIT IN WITH THE CHARACTER, UH, OF, OF THAT NEIGHBORHOOD.

AND THAT'S ALL I'VE GOT FOR YOU, UH, CHAIR.

I'M HAPPY TO ANSWER ANY QUESTIONS YOU HAVE.

UM, INTERIM GENERAL MANAGER.

I, I WAS LOOKING, I JUST HAVE A QUESTION FOR YOU AND YOUR STAFF.

ITEM NUMBER SIX IS THE WINTER STORM AFTER ACTION UPDATE.

AND I KNOW THAT WE HAVE SOME ITEMS RELATING TO OTHER DEPARTMENTS REPORTING ON AFTER ACTION FROM THE WINTER STORM, AND I WANTED TO KNOW IF YOUR STAFF WOULD BE ABLE TO STAY AND MAKE THAT PRESENTATION IN THE CONTEXT

[00:20:01]

YES.

UM, I'VE BEEN ENGAGED WITH, UH, ALL THE CITY DEPARTMENTS ARE WORKING TOGETHER ON THE CITY'S COLLABORATIVE AFTER ACTION PROCESS.

SO WE'VE, UH, COMBINED FORCES ON THAT PRESENTATION.

SO I HAVE A SECTION OF THAT, UH, AS WELL.

SO I'LL BE HERE FOR THAT.

UM, SANDRA INTERRUPT YOU GUYS REAL QUICKLY, I DO HAVE THE VIDEO AVAILABLE IF WE WANNA SHOW THAT.

SURE.

THAT'S GREAT.

IT'S OKAY.

TWO MINUTES OR LESS.

AS PART OF THE REPOWERING DOWNTOWN INITIATIVE TO ADDRESS THE GROWING NEED FOR RELIABLE ENERGY IN DOWNTOWN AUSTIN, AUSTIN ENERGY BEGAN DEVELOPING PLANS FOR THEIR NEWEST SUBSTATION IN 2017.

THE RAINY STREET SUBSTATION IS ONE PROJECT IN A SERIES OF IMPROVEMENTS THAT WILL INCREASE THE CAPACITY, RESILIENCY, AND RELIABILITY OF THE DOWNTOWN AUSTIN ELECTRICAL GRID.

THIS PROGRAM INCLUDES UPGRADES TO EXISTING ENERGY FACILITIES AND INFRASTRUCTURE, ALONG WITH NEW FACILITIES THAT WILL EXCEED THE GROWING ENERGY NEEDS IN DOWNTOWN.

THE SUBSTATION WILL INCREASE AVAILABLE ENERGY RESOURCES IN DOWNTOWN BY 33%, PRESERVING THE QUALITY OF LIFE FOR YOU AND YOUR NEIGHBORS FOR YEARS TO COME BY ENSURING THE SERVICES, JOBS, ENTERTAINMENT, SHOPPING, AND TRANSPORTATION IN DOWNTOWN HAVE AMPLE POWER TO THRIVE.

AUSTIN ENERGY RECOGNIZED THAT THE SUBSTATION SITE WAS IN THE HEART OF THE RAINY DISTRICT, A SPECIAL PLACE WITH A UNIQUE CHARACTER.

OUR TEAM COLLABORATED WITH THE LOCAL COMMUNITY TO BUILD A SPACE WHERE NEIGHBORS AND VISITORS COULD FEEL AT HOME.

COMMUNITY VALUES WERE AT THE CORE OF THE DESIGN PROCESS.

AUSTIN ENERGY PRIORITIZED SAVING BELOVED HERITAGE OAK TREES, AND EQUIPPED THE NEW SUBSTATION WITH ECO-FRIENDLY RAIN GARDENS THAT IMPROVE WATER QUALITY AND DRAINAGE, NEW SIDEWALKS FOR BETTER WALKABILITY AND BENCHES, TREES AND STREET LIGHTING TO CREATE A COMMUNITY GATHERING PLACE.

THERE ARE EVEN ELECTRIC VEHICLE CHARGING STATIONS FOR YOUR ECO-FRIENDLY RIDE.

THE RAINY STREET SUBSTATION IS THE FIRST IN AUSTIN TO INCORPORATE THESE UNIQUE DESIGN ELEMENTS, INCLUDING THE ONE-OF-A-KIND PERIMETER WALL DESIGNED IN PARTNERSHIP WITH THE COMMUNITY.

THIS SUBSTATION IS A CREATIVE BLEND OF NEEDED INFRASTRUCTURE AND A LANDMARK DESIGN FOR ALL TO ENJOY WITH THE PATIENCE AND SUPPORT OF THE LOCAL NEIGHBORHOOD.

CONSTRUCTION STARTED IN THE FALL OF 2021 AND WAS COMPLETED ON TIME AND WITHIN BUDGET WITH THE RAINY STREET SUBSTATION ENERGIZED IN JANUARY, 2023, THE DOWNTOWN ELECTRICAL GRID IS STRONGER AND MORE RELIABLE, POWERING THE BRIGHT FUTURE AHEAD FOR DOWNTOWN AUSTIN.

I'M GLAD YOU WERE ABLE TO PULL THAT UP.

THANK YOU.

THAT WAS LOVELY.

DOES ANYBODY HAVE ANY QUESTIONS FOR MR. RILEY? GREAT, THANK YOU SO MUCH.

THANK YOU, SIR.

OKAY, ITEM

[4. ERCOT Market and the Power Supply Adjustment]

.

GOOD MORNING, ERICA.

GLAD YOU'RE HERE.

GOOD MORNING.

UH, COUNCIL MEMBERS, MY NAME'S ERICA BIEROCK AND I'M VICE PRESIDENT OF ENERGY MARKET OPERATIONS AND RESOURCE PLANNING AT AUSTIN ENERGY.

AND I'M HERE TODAY TO TALK TO YOU ABOUT THE POWER SUPPLY ADJUSTMENT OR THE PSA AND HOW IT IS IMPACTED BY THE ERCOT, NO MARKET.

THANKS.

SO THE PSA IS A DOLLAR FOR DOLLAR RECOVERY OF, UH, COSTS THAT INCLUDE ERCOT SETTLEMENTS.

UH, YOU'LL SEE THERE ARE CHARGES AND CREDITS, AND WE'RE GONNA DELVE INTO THAT SPECIFICALLY AND HOW THAT FLOWS THROUGH THE PSA.

THERE'S ALSO ALL OF OUR FUEL FOR OUR POWER PLANTS, UM, THE TRANSPORTATION OF THAT FUEL AS WELL AS TRANSACTIONS WE ENTER INTO TO MANAGE THE VOLATILITY AROUND THOSE COMMODITIES.

ALSO INCLUDED IN OUR POWER SUPPLY ADJUSTMENT ARE THE, UH, POWER PURCHASE AGREEMENTS.

SO THOSE ARE OUR RENEWABLE CONTRACTS.

THOSE ARE, UM, UH, BILATERAL, UH, PURCHASES AND SALES WE ENTER INTO TO PROVIDE PRICE CERTAINTY AS WELL AS PROGRAMS LIKE OUR GREEN CHOICE VALUE OF SOLAR, AND THEN DISTRIBUTED GENERATION.

SO ALL OF THESE ITEMS, UM, ARE IN THE PSA AND THAT IS A, UH, THE PSA IS, IS SET ANNUALLY BY CITY COUNCIL, AND IT'S A MECHANISM TO RECOVER THE PRIOR YEAR'S EXPENSES THAT WE INCUR TO BE ABLE TO PROVIDE ELECTRICITY FOR OUR CUSTOMERS.

NEXT SLIDE.

SO, UM, LAST FALL, UH, YOU MAY REMEMBER THAT, UM, UH, CITY COUNCIL AUTHORIZED AUSTIN ENERGY TO ADMINISTRATIVELY CHANGE THE PSA AS CONDITIONS REQUIRE THAT CHANGE CAN ONLY BE A PLUS OR MINUS 5% TO THE EXISTING PSA RATE FOR ANY GIVEN MONTH.

AND, UH, COUNCIL ENABLED AUSTIN ENERGY TO BE ABLE TO DO THIS TO

[00:25:01]

UM, IN DECEMBER, AUSTIN ENERGY BEGAN SENDING A MEMO TO COUNSEL, AND IN THIS MEMO, WE ARE PROVIDING A STATUS OF WHAT THE PSA BALANCE IS, AS WELL AS, UH, INDICATING WHETHER OR NOT WE WILL BE USING THIS, UH, ADMINISTRATIVE AUTHORITY.

WE HAVE NOT USED THIS ADMINISTRATIVE OR EXERCISE THIS AUTHORITY TO DATE, BUT I WANT TO TALK TO YOU ABOUT, UH, PROVIDE SOME BACKGROUND, UH, ABOUT SOME FACTORS SHOULD WE NEED TO USE THIS ADMINISTRATIVE AUTHORITY, WHAT COULD CAUSE US TO, TO INCORPORATE THIS CHANGE SLIDE.

SO, BEFORE WE GET INTO HOW THE PSA IS IMPACTED BY ERCOT, I WANNA TALK A LITTLE BIT ABOUT WHAT ERCOT ROLE IS.

SO ONE OF THEIR PRIMARY RESPONSIBILITIES IS SYSTEM RELIABILITY.

SO THEY ARE RESPONSIBLE FOR POWER DISPATCH THROUGHOUT THE ENTIRE SYSTEM.

THEY'RE, THEY'RE RESPONSIBLE FOR MAINTAINING THAT RELIABILITY, THAT 60 HERTZ ACROSS THE ENTIRE, UH, NETWORK.

UH, AND THEY DO THIS BY SCHEDULING AND MANAGING THAT POWER FLOW THROUGH THE NETWORK.

IN ADDITION TO THAT, THEY ARE ALSO RESPONSIBLE FOR OPERATING ERCOT ELECTRIC MARKET.

SO THEY ARE RESPONSIBLE FOR, THEY'RE KIND OF LIKE THE, LIKE A STOCK EXCHANGE FOR ELECTRICITY.

SO THEY PROVIDE, THEY DO ALL THE FINANCIAL SETTLEMENTS FOR ALL THE SELLERS AND ALL THE BUYERS THAT ARE, THAT ARE IN THE, IN THE MARKET.

SO WHEN I SAY FINANCIAL CEMENT SETTLEMENTS, WHAT I MEAN IS HOW OUR, HOW OUR SUPPLY OR OUR ELECTRIC PRODUCTION IS VALUED IN THE MARKET AS WELL AS OUR CONSUMPTION.

AND, UH, THEY'RE ALSO RESPONSIBLE FOR OPEN ACCESS TO THE TRANSMISSION SYSTEM.

AND WHAT YOU'LL SEE HERE, UH, ON THE SLIDE TO THE RIGHT IS, IS A HEAT MAP.

AND THIS IS FROM LAST WEEK.

AND ALL OF THOSE DOTS ARE NODES.

THERE'S THOUSANDS OF THEM, UH, IN THE ERCOT MARKET, AND THEY ALL RECEIVE THEIR OWN DISTINCT, UH, PRICE EVERY 15 MINUTES OF EVERY DAY.

AND WHAT YOU CAN SEE, LIKE IN THE NORTH PART NEXT TO THE PANHANDLE, UH, THAT RED, UH, UH, RED PART OF THE STATE, UH, THOSE PRICES HAVE GOTTEN AS HIGH AS $5,000.

SO THAT'S THE CAP.

UM, THAT'S AS HIGH AS PRICES CAN GET RIGHT NOW IN THE AIRCO MARKET, BUT THEY CAN GET AS LOW AS NEGATIVE $250 AS WELL.

AND THERE'S, THERE'S JUST A LOT OF DIFFERENT REASONS WHY THIS HAPPENS.

UM, UP IN THE PANHANDLE, YOU SEE THAT THAT'S BLUE.

UM, IT, THERE, THERE, THERE COULD BE SOME, UH, SOME SUPPLY THAT'S STRANDED.

THERE'S NOT ENOUGH LOAD TO BE ABLE TO CONSUME THAT, AND THERE'S NOT ENOUGH WIRES TO, TO PULL THAT, UH, OUT OF THAT PART OF THE STATE.

SO FOR THIS VARIATION OF PRICES FROM A HIGH 5,000 DOWN TO A LOW NEGATIVE TWO 50 IS, UH, WHAT THE PSA IS IMPACTED BY THAT VARIATION, THAT VOLATILITY AND PRICES.

AND SO WE'LL SEE A LITTLE BIT ABOUT HOW, UH, THAT PASSES THROUGH THE PSA AND HOW WE MANAGE THAT.

SO THIS IS A SNAPSHOT OF AUSTIN ENERGY, AND WE TALKED A LITTLE BIT, I MENTIONED ABOUT THOSE CHARGES AND THOSE CREDITS THAT ARE IN ERCOT SETTLEMENTS.

SO A CHARGE REFERS TO ALL THE ELECTRICITY THAT OUR CUSTOMERS CONSUME, WHICH WE BUY FROM ERCOT.

CREDITS ARE ALL THE ELECTRICITY THAT OUR PORTFOLIO GENERATES AND SELLS TO ERCOT CAUGHT AUSTIN ENERGY HAS GENERATION RESOURCES ALL OVER THE STATE, BUT WE ONLY CONSUME ENERGY HERE IN AUSTIN.

THERE IS, WHAT, WHAT IS THE TAKEAWAY I WOULD LIKE FOR YOU, FOR YOU TO, TO, TO, TO TAKE AWAY FROM TODAY'S PRESENTATION IS THAT THERE IS NO PHYSICAL LINK BETWEEN THESE TWO.

THE AMOUNT OF ELECTRICITY THAT OUR CUSTOMERS CONSUME IS NOT DEPENDENT ON THE AMOUNT OF GENERATION THAT OUR PORTFOLIO PRODUCES.

THERE IS, UH, NO ELECTRIC PROVIDER IN ERCOT THAT SERVES THEIR OWN LOAD.

AND UNDER STATE LAW, WE ARE REQUIRED TO BUY OUR, UH, ELECTRICITY FROM ERCOT AND SELL OUR ELECTRICITY TO ERCOT.

SO ON THE RIGHT HAND SIDE, YOU'LL SEE THAT THAT IS OUR SERVICE TERRITORY.

AND THAT SERVICE TERRITORY IN, UH, ERCOT IS CALLED AUSTIN ENERGY'S LOAD ZONE.

AND THAT IS THE, UH, PRICE OF THE PRICE OF POWER IS, UH, SETTLED EVERY 15 MINUTES.

AND THAT IS WHAT, UH, WE INCUR AND THAT PASSES THROUGH THE PSA, ALL OF THAT GENERATION THERE ON YOUR LEFT, WHICH IS DIVERSE AND IS ALL OVER THE STATE.

WE OFFER THAT POWER INTO THE ERCOT MARKET.

WE, UH, SEND THEM THEM, UH, A, UM, UH, A PRICE CURVES, AND THEN ERCOT TELLS US WHAT, UH, WE, WHAT THEY WILL BUY FROM US BECAUSE THEY'RE LOOKING AT THE CONSUMPTION ALL ACROSS THE MARKET.

SO OUR GENERATION GOES TO THE ENTIRE MARKET, UM, AND WE RECEIVE REVENUE FOR THAT GENERATION.

SO

[00:30:01]

IT'S A FINANCIAL LINK.

IT PROVIDES, UH, PROTECTION FOR THOSE HIGH PRICES THAT YOU SAW ON THAT HEAT MAP.

IT PROVIDES AN AFFORDABLE HEDGE.

SO THEN WE CAN PROVIDE, UH, UH, AFFORDABLE POWER TO OUR CUSTOMERS.

SO ERCOT IS REALLY RESPONSIBLE FOR THAT PHYSICAL GENERATION, THAT POWER FLOW, MAKING SURE THAT EVERYTHING BALANCES ON THE GRID.

AUSTIN ENERGY IS RESPONSIBLE FOR BALLING, BALANCING THE COST AND THE REFU REVENUES THAT FLOW THROUGH THE PSA.

CAN YOU GO TO THE NEXT ONE? SO ALL THE WAY TO THE LEFT, YOU'LL SEE AN ORANGE BAR, AND THERE IS OUR LOAD ZONE.

THAT IS OUR LOAD ZONE COST FOR THE LAST 12 MONTHS, ENDING FEBRUARY.

THAT STANDS AT ONE POINT, A LITTLE OVER 1.1 BILLION.

UM, THAT IS WHAT WOULD FLOW THROUGH THE PSA IF WE STOPPED RIGHT THERE, BUT, BUT AUSTIN ENERGY DOESN'T ALL THE WAY TO, UH, CONTINUING TO THE RIGHT, YOU'LL SEE OUR OWNED ASSETS, OUR CONTRACTED ASSETS, THOSE PROGRAMS I TALKED ABOUT, AND THE BILATERAL AND HEDGING, UH, RISK MANAGEMENT ACTIVITIES THAT WE DO THAT ADD VALUE TO OUR PORTFOLIO AND HELP EITHER OFFSET OR MINIMIZE THE EXPOSURE WE HAVE TO THOSE PRICES IN THE ARCO MARKET.

SO OVER THE LAST 12 MONTHS, ALL OF THOSE ACTIVITIES WE'RE ABLE TO BRING DOWN THAT ONE POINT OVER 1.1 BILLION, DOWN TO 562 MILLION.

SO PROVIDING A 50%, UH, CREDIT, UH, 15% OFFSET TO OUR PSA, UM, AND PRO ALLOWING US TO BE ABLE TO PROVIDE MORE AFFORDABLE POWER TO OUR CUSTOMERS.

WE GO TO THE NEXT SLIDE.

SO WE TALKED ABOUT WHAT WOULD, WHAT ARE SOME OF THOSE COST DRIVERS? UM, WE TALKED ABOUT LOAD ZONE, COST, OWN AND CONTRACTED ASSETS.

THAT PSA IS SET ONCE A YEAR.

ANNUALLY, THAT RATE IS APPROVED BY CITY COUNCIL, BUT THE LOAD ZONE COST, THE OWNED ASSETS, THE CONTRACTED ASSETS, THOSE PRICES MOVE EVERY 15 MINUTES.

WE SAW THAT ON THE HEAT MAP.

WHAT ARE SOME OF THE THINGS THAT AFFECT THOSE PRICES THAT AFFECT, UH, THOSE SETTLEMENTS, THOSE CREDITS AND CHARGES THAT WE TALKED ABOUT? SO THERE'S A LOT OF THINGS, AND YOU'LL SEE THEM UNDERNEATH CUSTOMER GROWTH.

UH, THE AMOUNT OF POWER THAT ARE CUSTOMERS ARE PULLING FROM THE GRID, THE WEATHER, WHETHER IT'S HOT OR WHETHER IT'S REALLY COLD IN THAT ELECTRIC HEAT, THEY NEED TO, THEY, THEY NEED TO WARM UP THEIR HOMES.

THE WEATHER ALSO AFFECTS OUR RENEWABLE, UH, CONTRACTS.

UM, IF THE SUN ISN'T THERE OR THE WIND ISN'T BLOWING, THEN OUR, UH, IT WON'T BE GENERATING, UH, UH, UH, POWER FOR US TO BE ABLE TO, UM, RECEIVE REVENUE.

UM, EVEN THINGS LIKE, UH, WHETHER OR NOT OUR ASSETS ARE AVAILABLE.

SO GENERATOR AVAILABILITY, VERY IMPORTANT.

I NEED MY, UH, MY, UH, ASSETS TO BE MAINTAINED SO THEN WHEN THOSE HIGH PRICES OCCUR, THEY CAN COME ON QUICKLY AND PROVIDE THE REVENUE TO OFFSET THOSE LOAD ZONE COSTS.

NATURAL GAS IS A REALLY IMPORTANT PART OF, UM, OUR COMMODITY COSTS.

IT'S AN IMPORTANT, UH, FEATURE OF THE ERCOT MARKET BECAUSE THERE'S SO MUCH NATURAL GAS GENERATION IN THE MARKET, IT KIND OF SETS THE PRICE.

SO WHETHER WE HAVE THAT GENERATION IN OUR PORTFOLIO OR NOT, WE'RE STILL AFFECTED BY THOSE NATURAL GAS PRICES.

AND THEN WE SAW ALL THOSE DIFFERENT COLORS ON THE HEAT MAP, THAT'S TRANSMISSION CONGESTION.

I COULD HAVE A HIGH PRICE IN MY LOAD ZONE, BUT A LOW PRICE, UH, AT, UH, AT ONE OF MY POWER PLANTS.

AND SO IT MAKES IT DIFFICULT FOR ME TO OFFSET THOSE COSTS.

SO WE ENTER INTO DIFFERENT TYPES OF TRANSACTIONS TO BE ABLE TO, UH, BRING THOSE PRICES TOGETHER.

SO THERE'S A, UH, THERE'S DIFFERENT, UM, TYPES OF INSTRUMENTS THAT WE USE TO BE ABLE TO MANAGE THE DIFFERENCE BETWEEN WHAT YOU SEE THERE, THE PSA RATE TO MARKET PRICE SPREAD.

SO THE RATE THAT I'M, UH, SELLING THAT, UH, POWER TO MY CUSTOMER, UH, THAT ANNUAL RATE AND THAT RATE THAT FLUCTUATES, OR THOSE PRICES THAT FLUCTUATE EVERY 15 MINUTES IN THE MARKET EVERY DAY.

UM, SO LET'S GO TO THE NEXT SLIDE.

SO THIS SLIDE RIGHT NOW HERE, I JUST WANT TO, UH, TWO TAKEAWAYS FROM THIS SLIDE.

AND THIS IS GONNA SHOW AN THE, THE SAME, UH, PICTURE I WAS SHOWING PREVIOUSLY WITH REGARDS TO OUR LOAD ZONE COST, AND THEN WHAT THE GENERATION DOES FOR THAT.

IT SHOWS IT TO YOU A LITTLE BIT DIFFERENTLY.

UM, BUT THIS RIGHT HERE SHOWS, UM, WHERE OUR PRICE, WHAT THE LOAD ZONE COSTS WERE FOR, UH, AUSTIN ENERGY, UM, BY THE END OF LAST SUMMER.

AND IF WE HAD JUST, JUST HAD, UH, UH, THE LOAD COSTS AND NO GENERATION OR NO OTHER RISK MANAGEMENT ACTIVITIES THAN WE WOULD HAVE, UH, EXPERIENCED AND PASSED THROUGH THAT, UH, ORANGE, UH, BAR TO OUR CUSTOMERS.

BUT WITH THE GENERATION, WITH THE RISK MANAGEMENT ACTIVITIES, WE'RE ABLE TO STABILIZE AND WE'RE ABLE TO BRING DOWN, UM, THOSE TOTAL COSTS.

AND WE WENT FROM $96 TO $40.

ONE THING I WANNA

[00:35:01]

UH, WE ALSO HAD VERY HIGH NATURAL GAS PRICES.

THEY REACHED $9, UH, UH, AN M BTU U AND ERCOT WAS ALSO, UM, VERY CONSERVATIVE IN HOW WE THEY MANAGED THAT SYSTEM.

RELIABILITY THAT I EXPLAINED, THE POWER DISPATCH AND THAT POWER FLOW, UM, COMING OUT OF URI, THEY WERE BEING MUCH MORE CAREFUL ABOUT HOW THEY MANAGED THE GRID AND KIND OF ADDED ON EXTRA INSURANCE POLICIES.

UM, AND IT'S THE MARKET PARTICIPANTS THAT PAY FOR THAT.

SO PART OF, UH, THOSE HIGH COSTS WERE ALL OF THOSE FACTORS THAT I MENTIONED.

UM, AND ALTHOUGH WE WERE ABLE TO BRING DOWN, WE WERE ABLE TO BRING DOWN, UH, THOSE COSTS, UH, UH, QUITE A BIT.

WE STILL HAD AN UNDER COLLECTION, UH, AT THE END OF LAST SUMMER.

AND THAT BRINGS ME TO THE BLACK AND GRAY LINE.

AT THE END OF, WHEN WE CAME OUT OF YURI, WE HAD ACTUALLY AN OVER COLLECTION, UM, OUR GENERATION AND, UH, OUR POWER PLANTS DID QUITE WELL, AND WE GAVE THAT REVENUE BACK TO OUR CUSTOMERS.

SO WE LOWERED THE RATE FROM THE BLACK LINE TO THE GRAY 28.62 LINE, BUT WE LOWERED THAT RATE INTO, UM, A VERY HOT SUMMER, HIGH NATURAL GAS PRICES IN A VERY CONSERVATIVE, UH, MANAGEMENT OF, UH, THE, UH, ERCOT GRID.

SO IN, UM, UH, NOVEMBER OF LAST YEAR, UM, WE RAISED THE POWER SUPPLY ADJUSTMENT TO ACCOUNT FOR, UH, WHAT YOU SEE HERE ON THE GRAPH.

AND AT THAT SAME TIME, UH, CITY COUNCIL AFFORDED US THAT ADMINISTRATIVE, UH, AUTHORITY.

SO THEN WE CAN INCREMENTALLY ADJUST THE PSA AND HAVE A MORE FINE TUNED ABILITY TO MANAGE, UM, THE CUSTOMER COST IMPACTS.

AND IS THAT THE LAST ONE? SO, UH, ANYONE HAS ANY QUESTIONS, I'M HAPPY TO TAKE THEM.

THANKS, MS. BIEROCK.

ANY QUESTIONS? VERY GOOD, THANKS.

THANK YOU SO MUCH.

MOVING ON TO ITEM NUMBER

[5. Austin Energy Innovations and Program Highlights - Electric Vehicle Program Overview]

AND WE HAVE THE VICE PRESIDENT FOR CUSTOMER ENERGY SOLUTIONS WITH US TODAY, RICHARD GENE, AND TELL ME IF I'M SAYING YOUR NAME CORRECTLY.

UH, CAMERON FREEBERG, WHO IS INTERIM MANAGER FOR ELECTRIC VEHICLES AND EMERGING TECHNOLOGIES.

GOOD MORNING, GENTLEMEN.

YES, GOOD MORNING CHAIR.

GOOD MORNING COUNCIL MEMBERS, UH, CITY MANAGER.

UH, MY NAME IS RICHARD GENY.

I'M THE VICE PRESIDENT OF CUSTOMER ENERGY SOLUTIONS, WHICH IS MANY OF OUR CUSTOMER FACING PROGRAMS AT AUSTIN ENERGY.

AND AS AS YOU HEARD, UH, CAMERON FREEBERG IS OUR INTERIM MANAGER OF ELECTRIC VEHICLES AND EMERGING TECHNOLOGIES.

UH, SOME OF YOU MAY HAVE KNOWN, UH, CARL POPHAM, WHO WAS OUR PREVIOUS, UH, UH, MANAGER OF ELECTRIC VEHICLES, VEHICLES AND EMERGING TECHNOLOGIES.

AND HE RETIRED FROM, UH, AUSTIN ENERGY IN THE CITY OF AUSTIN.

LAST, LAST, UH, WEEK.

NEXT SLIDE PLEASE.

SO WE HAVE STRONG, UH, ELECTRIC VEHICLE GROWTH IN AUSTIN.

WE HAVE RECORD EV REGISTRATIONS.

UH, THERE ARE MORE EVS BEING DRIVEN IN AUSTIN THAN EVER BEFORE.

A MAJOR CONTRIBUTING FACTOR IS THERE'S MORE AVAILABILITY OF, UH, NEW VEHICLE MODELS COMING INTO THE MARKET.

ONE OF THE, UH, TRENDS THAT YOU SEE HERE, UH, THAT WE EXPECT TO CONTINUE IS AN EX, UH, CONTINUING DIVERGENCE BETWEEN HYBRID HIGH PLUGIN, HYBRID EVS AND BATTERY EVS.

AND THAT'S DRIVEN BY, UH, ENERGY DENSITY IN BATTERIES AND EV RANGE GETTING LONGER.

THE PLUG-IN HYBRID EVS HAVE A GAS, UH, ENGINE IN ADDITION TO AN ELECTRIC COMPONENT THAT IS USUALLY USED AS A RANGE EXTENDER, BUT AS THE ENERGY DENSITY INCREASES, THERE'S LESS AND LESS, UM, ACTIVITY WITH PLUG-IN HYBRID EVS, AND YOU'LL CONTINUE TO SEE THAT GROW.

SO MUCH OF OUR WORK HERE, UM, IS IN SUPPORT OF THE AUSTIN AND AUSTIN CLIMATE EQUITY PLAN.

UM, A LOT OF WHAT WORK HAS ALREADY BEEN DONE IN, IN PROGRESS AND REDUCING EMISSIONS IN BUILDINGS, UH, IS, YOU KNOW, THROUGH THE AUSTIN ENERGY GREEN BUILDING PROGRAM HAS REALLY, UH, UH, WORKED TO REDUCE, UH, UH, EMISSIONS.

NOW WE ARE FOCUSED ON THE TRANSPORTATION SECTOR AND WE ARE AT, UM, AUSTIN IS LEADING, UH, THE STATE OF TEXAS AND AUSTIN IS ACTUALLY, UH, LEADING THE COUNTRY IN TERMS OF THE PERCENTAGE OF NEW VEHICLE REGISTRATIONS THAT ARE EVS VERSUS, UH, NON EVS.

AS YOU CAN SEE ON THE SLIDE, IT'S 11% FOR AUSTIN, IT IS 5% FOR THE STATE OF TEXAS AND AROUND 9%, UH, FOR THE COUNTRY.

NEXT SLIDE.

WE HAVE A FIVE PILLAR STRATEGY, UH, TO SUPPORT OUR MISSION OF DELIVERING

[00:40:01]

OUR APPROACH IS UNIQUE BECAUSE IT'S VERY COMPREHENSIVE, UH, INCLUDING CHARGING INFRASTRUCTURE, EQUITY AND AFFORDABILITY FLEETS AND NEW MOBILITY, OUTREACH AND EDUCATION AND GRID INTEGRATION, ALL OF WHICH WE'RE GOING TO TOUCH ON, UH, TODAY.

UM, I WANT TO MAKE, UH, PAINT FOR YOU THAT OF THESE FIVE PILLARS, WE HAVE 25 PROGRAMS SITTING UNDERNEATH, UM, THEM AND FOR US, INNOVATION, UH, EXTENDS BEYOND TECHNOLOGY INTO PROGRAM DESIGN AND PARTNERSHIPS AND STAKEHOLDERS.

SO WE REALLY WANT TO TAKE A HOLISTIC VIEW AND APPROACH, UM, TO THIS SECTOR.

NEXT SLIDE, PLEASE.

OUR REBATE PROGRAM, UH, HAS REBATES FOR RESIDENTIAL, COMMERCIAL AND, UH, DC FAST STATIONS, UH, FROM 1200 AT A LOW ALL THE WAY UP TO 15,000 AT A HIGH.

OUR PLUG-IN EVERYWHERE DRIVER PROGRAM IS REALLY IMPORTANT BECAUSE, UH, ONE OF THE CHALLENGES IN, UH, ELECTRIC VEHICLES IS AN INCONSISTENT USER EXPERIENCE ACROSS, UH, MANY CHARGING STATIONS.

SO OUR PLUG-IN EVERYWHERE DRIVER PROGRAM PROVIDES THAT CONSISTENT USER EXPERIENCE ACROSS 1,542 LEVEL TWO PORTS.

UM, AND THEN WE, YOU KNOW, WE SUPPORT, UH, DC FAST CHARGING.

WE HAVE 30 DC FAST CHARGERS IN OUR, UH, NETWORK.

AND WE'RE GONNA GONNA TALK MORE, UH, THROUGHOUT THIS PRESENTATION ABOUT DC FAST CHARGING AS WELL.

NEXT SLIDE, PLEASE.

SO WHERE IS ALL THE EV CHARGING TAKING PLACE? WELL, IMPORTANT TO UNDERSTAND THAT 80% OF IT, UH, IS AT HOME AND 20% OF IT IS, YOU KNOW, AT PUBLIC STATIONS WITH WHICH, WITH WHICH ARE PROVIDING THAT MIX OF LEVEL ONE, LEVEL TWO, AND DC FAST CHARGING.

NEXT SLIDE, PLEASE.

UM, THIS SLIDE REALLY JUST MAKES SURE THAT, YOU KNOW, WE ARE APPLYING THE RIGHT CHARGING INFRASTRUCTURE TO THE RIGHT APPLICATION.

THERE ARE THREE LEVELS OF CHARGING, UH, THAT WE HAVE IN OUR NETWORK.

LEVEL ONE, LEVEL TWO, AND LEVEL THREE.

UH, LEVEL ONE IS YOUR STANDARD 120 VOLT, UH, OUTLET.

AND IT'S NON-INTELLIGENT, UH, NON-COMMUNICATION, BUT IT'S, UH, A GOOD APPLICATION FOR RESIDENTIAL AND OVERNIGHT CHARGING.

UH, LEVEL TWO CHARGING IS THE, UH, MAJORITY OF OUR 1,542 PORT NETWORK PUBLIC CHARGING, UH, THAT IS, UH, LEVEL TWO CHARGERS ARE ALSO AVAILABLE FOR HOME OR THEY'RE AVAILABLE FOR THE PUBLIC AND THEY, UH, THEY'RE FASTER.

UM, AND YOU KNOW, WE, WE, AS I SAID PREVIOUSLY, WE DO DELIVER OR WE DO OFFER REBATES FOR THEIR INCENTIVE.

DC FAST CHARGING, UM, ARE THE FASTEST.

UH, BUT IT IS, IT'S IMPORTANT TO UNDERSTAND THEY CAN CHARGE OUR VEHICLE IN MINUTES AS OPPOSED TO OURS.

THEY HAVE VERY HIGH POWER DENSITY.

UH, TO PUT IT IN CONTEXT, A SINGLE DC FAST CHARGER COULD DRAW AS MUCH POWER AS A LARGE COMMERCIAL BUILDING, SO THEY HAVE MUCH FASTER CHARGING SPEEDS, BUT THERE NEED TO BE CONSIDERATIONS FOR COST, PHYSICAL SPACE, AND GRID IMPACT.

SO, UM, IMPORTANT TO UNDERSTAND THE CONTEXT OF RIGHT MATCHING THE RIGHT CHARGER FOR THE RIGHT APPLICATION.

NEXT SLIDE.

IN TERMS OF OUR TOTAL, UH, NETWORK, UM, I WANTED TO PAINT THE PICTURE FOR YOU OF, YES, WE HAVE 1,542 LEVEL TWO CHARGERS IN OUR NETWORK AND 30 DC FAST CHARGERS.

OUTSIDE OF THAT, THERE'S PROBABLY ABOUT ANOTHER THOUSAND CHARGERS THAT ARE NOT ASSOCIATED WITH OUR NETWORK AND NOT BRANDED AE.

UM, BUT WITHIN THE ONES THAT ARE IN PART OF OUR NETWORK, WE ONLY OWN AND OPERATE 19%, UH, APPROXIMATELY 292 OF THAT 1,542.

WE WORK WITH THE OTHERS, THEY ARE OUR PARTNERS.

AND, UH, THEY ARE, YOU KNOW, SO THE 81% PRIVATE PARTICIPATE IN THE AUSTIN ENERGY NETWORK AND PROVIDE THAT CONSISTENT USER EXPERIENCE.

THEY SIGN A HOSTING AGREEMENT WITH AUSTIN ENERGY AND, UM, AND WE WORK WITH THEM THROUGH THAT HOSTING, UH, ARRANGEMENT.

UM, YOU KNOW, IN OUR HISTORY OF THIS PROGRAM, THE FIRST 10 YEARS WE WERE FOCUSED ON GROWTH AND, YOU KNOW, WE WANT THE NEXT 10 YEARS TO BE FOCUSED ON RELIABILITY AND PERFORMANCE.

NEXT SLIDE.

THANK YOU, RICHARD VING.

GOOD MORNING.

UM, AS WE DISCUSS CHARGING INFRASTRUCTURE AND OPERATIONAL EXCELLENCE, I WANT TO GIVE A STATUS OF THE HEALTH OF OUR CHARGING NETWORK THAT WE HAVE HERE IN AUSTIN AS WELL.

UM, SO IT IS A INDUSTRY-WIDE KNOWN ISSUE THAT, UM,

[00:45:01]

AND I WANNA ADDRESS OUR PORTION OF THAT.

IN JANUARY OF 2023, WE LOOKED AT A 28% OUTAGE RATE OF OUR CHARGING NETWORK.

AND SINCE HAVE REDUCED THAT TO 17% THROUGH SOME ACTIONS THAT WE'VE TAKEN TO INCLUDE REPLACING LEGACY HARDWARE, PERFORMING REGULAR MAINTENANCE ON THESE STATIONS, AND WORKING WITH OUR MAINTENANCE CONTRACTOR TO MAKE REPAIRS, UH, WE WANT TO TAKE THAT EVEN FURTHER.

AND THEN WE HAVE AN ACTION PLAN AND NEXT STEPS TO REDUCE THE OUTAGE FROM 17%.

EVEN FURTHER TO INCLUDE, WE'RE GONNA BE RUNNING A PREVENTATIVE MAINTENANCE SCHEDULE, UH, STARTING IN APRIL TO VISIT ALL FIFTEEN A HUNDRED FORTY TWO OF OUR, UH, CHARGING STATION COURTS, UM, WHERE WE CAN DO ADVANCED DIAGNOSTICS ON THESE STATIONS, UM, AND GET DIRECT REPORTING FOR US TO BE ABLE TO MAKE REPAIRS, AS WELL AS TO COMMUNICATE THAT TO OUR STATION HOST PARTNERS THAT HAVE THESE CITED ON THEIR PROPERTY.

WE'RE ALSO LOOKING INTO EXTENDED WARRANTY AND SERVICE PLANS THAT CAN SERVICE THESE STATIONS.

AND THEN, UH, ONE OF THE BARRIERS IS FINDING AVAILABLE REPLACEMENT PARTS FOR SOME OF THESE MORE MODULAR SYSTEMS. SO IDENTIFYING VARIOUS STREAMS FOR THESE REPLACEMENT PARTS AND REPLACING THEM, UH, WILL SIGNIFICANTLY REDUCE THAT OUTAGE AS WELL.