Committee on Economic Development, Technology, and City Light 5/10/23

All right, you can go ahead.

Good morning, everybody.

Today is May 10th and the meeting of the Economic Development Technology and City Light Committee will come to order.

It is, let's see, 9.33, sun is shining and the sound you hear turbines spinning because we're at the snow melt and having a pretty good week so far when it comes to hydropower.

Anyway, I'm Sarah Nelson, chair of the committee.

Will the clerk please call the roll?

Council President Juarez.

Here.

Council Member Sawant.

Present.

Council Member Strauss.

Present.

Council Member Herbold.

Here.

Chair Nelson.

Present.

Five present.

Okay, thank you.

It's a full house.

All right, the first and only item on today's agenda is the rate stabilization account transfer ordinance.

which is a carryover from the last committee meeting where Seattle City Light staff and our central staff presented and answered initial questions from the committee.

And today we can go back and answer further questions and then hopefully vote this out of committee.

All right, are there any objections to the agenda?

Seeing none, the agenda is adopted.

With that, we'll move into the public comment period on items on our agenda.

And speakers will have two minutes.

Make sure to press star six to unmute yourselves.

I do not believe that we have anybody online.

We do not.

We do not.

So when you hear the chime, you will have 10 seconds left.

If you exceed your time, your microphone may be cut off so that we can move on to the next speaker.

So far, we've just got one signed up to speak in chambers.

So let's go ahead.

and begin with Dakota Donley.

Hello, council.

My name is Dakota Joseph Donley.

Now, I came here within the last two meetings to try to share an idea.

We speak about, is this pertaining to the legislation on the agenda?

Otherwise we- It pertains to the economy.

I'd like the chance to speak as I've been denied it twice.

I'm sorry.

I appreciate it if you would send your comments to us because that is the rule of our committee.

It got denied.

It got denied.

Yes.

Nobody has let me speak about my idea.

So I'd like to present it to this council.

Well, I have got to be consistent in the way that I apply the rules.

And so my clerk, Steven, could you please give him an email for him to be able to send?

I've already been given an email and was denied.

I'm sorry, sir.

I think this council would like to hear what I have to say.

I really do.

I agree with you, probably.

And I'm sorry, this is not the forum.

100% end homelessness.

All right, we will be coming to a close of the public comment period.

Just one moment while we get you a good email address.

Got it, thank you very much.

Okay, we have now had everybody speak who is signed up.

There's nobody else signed up.

And I will now close the public comment period.

Will the clerk please read item one into the record?

Agenda item number one, council bill 120556, an ordinance relating to the city light department authorizing the transfer of certain funds in the light fund into the rate stabilization account in 2023 and superseding certain provisions of subsection 21.49.086.E of the Seattle Municipal Code.

Sir.

Please.

Please leave the chambers or you can you're happy.

You're welcome to wait and listen to the meeting.

This is what we're going to do.

We will start the clock.

We are going to back up and you may speak.

I do not want to prolong this conflict anymore.

So I am reopening public comment and thank you very much for your patience and go ahead and please let us know what's on your mind.

Founders of an organization called Second Chance Outreach Solutions.

My organization has 100 percent solved the solution to end the homeless crisis in Seattle.

We own the patent for it and I want to bring it to Seattle.

Now we are getting ready to file for our status as an S-Corporation.

At the status of that I am offering to give the City of Seattle 15 shares upon the formation.

Let me tell you about what my organization can do.

Not only can we provide jobs to people who are struggling, but we can provide housing, shelter, water, food, referrals, and we can provide any service that any man, woman, or child is struggling with.

Any service.

We are aiming to do this worldwide.

Now I will have my business cards later this week.

If anyone is interested, I'd be more than happy to speak with you more.

I just ask that this council share the word.

Thank you and have a good day.

Thank you very much.

That's why I said it's about the economy.

Thank you.

I appreciate it.

I am closing again, public comment.

Would the clerk please read item one into the record?

Agenda item number one, Council Bill 120556, an ordinance relating to the City Light Department authorizing the transfer of certain funds in the light fund into the rate stabilization account in 2023 and superseding certain provisions of subsection 21.49.086.E of the Seattle Municipal Code.

For briefing, discussion and possible vote.

Yes.

So anyway, thank you very much.

City Light buys and sells energy on the wholesale energy market.

And because the utility typically has more energy than needed to meet retail demand, the sum of these sales are referred to the net wholesale revenue.

To insulate the utility and retail customers from the dynamics of the wholesale energy market in 2020, excuse me, In 2010, the City Council created the Rate Stabilization Account, which is what we're talking about today.

That is a cash reserve that serves to buffer the net wholesale revenue.

So our presenters are at the table and I'll just finish my remarks, then you can go ahead and be on hand for any questions that you might have or anything that I might have missed.

So we heard in last committee meeting that the combination of cold weather lower than normal hydropower production and high energy market prices require the utility to tap into the rate stabilization account.

This has brought the RSA below the $75 million threshold to trigger a rate surcharge for our customers.

The good news is that strong retail sales due to colder than normal winter temperatures has the utility in a strong financial position to allow for the transfer of funds into the RSA to avoid a rate surcharge coming in June.

What's important to me is to understand what are we doing to plan for and accommodate what will clearly be unusual and perhaps extreme weather events.

And so this we heard a presentation last night about how we are, how this transfer is in response to things that are completely out of our control.

And the this ordinance will simply transfer money from the light fund into the RSA.

So the longer term actions include the adoption of the 2022 Integrated Resource Plan, which is the IRP.

And if that sounds familiar, we did have a long briefing and some legislation about that last year.

And that calls for new resource acquisition and engagement with the Western Resource Adequacy Program, both actions taken by this committee in this past year.

We have City Light staff here today and Central Staff Eric McConaghy to answer any questions.

And so with that, I will open it up to my colleagues.

Okay, I'm not seeing any hands now.

What do you think policymakers should be thinking about right now when it comes to the fact that we do have this reserve?

And it seems as though we might have to do this in the future.

Are there any next steps that we didn't discuss last time that we should consider?

I don't mean to put you on the spot.

I'm sorry.

Good morning.

Carson Croft, manager of financial planning and rates.

I think you summed it up very well.

You know, activity in the wholesale market is a very dynamic process.

Right.

And we're continuing to address a variety of risks, you know, both with climate change and our hydro flows, as well as emerging markets.

So those are all things that we have on our radar and we will be watching and changing our trading and hedging practices accordingly.

Thank you.

Eric, it looks like you had something to say.

Yeah, just just very briefly Eric McConaghy and the council central staff.

Just a reminder that the rate stabilization account is in the code, it's it's set up to work automatically to smooth out unexpected swings in revenue from the wholesale markets.

It was working the way it's supposed to and this is a fortunate circumstance where City Light has cash on hand to avoid the automatic surcharge.

I think it's in an emergency, sort of a good situation to be in.

But I just want to remind folks that the RSA does exist.

Should there be a circumstance where there isn't extra cash on hand, RSA is there to smooth things out.

And that's codified and seems to be so far working through time.

Thank you.

I had a question, which was, if we weren't doing this legislation and possibly considering a vote, how much would the typical household experience in expense?

What would the surcharge cost?

Surcharge would be about 4%.

So it would be a little bit on a typical residential bill, about $80 a month.

4% would be roughly $4, give or take.

Okay.

Saving the big dollars, but that is significant.

It does add up.

And when you think about that spread out over our whole rate payer base, that is a lot of money.

And it's very fortunate that we do have reserves to accommodate the shortfall in our wholesale revenue.

Okay, I am not seeing any questions or comments.

If that is the case, I will go ahead and move that the committee recommend passage of Council Bill 120-556.

Is there a second?

Second.

It's been moved and seconded to recommend passage of the Council Bill.

And are there any further questions or comments?

And if not, we'll head into a vote.

Okay, seeing none, will the clerk please call the roll?

Council President Juarez?

Aye.

Council Member Sawant?

Yes.

Council Member Strauss?

Yes.

Council Member Herbold?

Yes.

Chair Nelson?

Aye.

Five in favor, zero opposed.

Excellent.

The motion carries and the committee recommendation that Council Bill 120556 pass will be forwarded to the city council for final consideration on May 16. So this concludes the agenda for today's economic development technology and city light committee and our next meeting is scheduled for Wednesday, May 24 at 930am.

And to preview that meeting, the committee will have briefing and discussion on two bills for City Light, a platted easement ordinance and a distribution easement ordinance.

And if there's no further business, this meeting is adjourned.

It is 946. Have a great day, everybody.

Thank you.

Thank you, Madam Chair.