Resolution No. 2012-245RESOLUTION NO. 2012-245
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON ADOPTING A CITY OF VERNON MINIMUM INVESTMENT
REPORT FIVE YEAR PLAN FY2013-FY2017 AS AN
ALTERNATIVE TO AN INTEGRATED RESOURCE PLAN UNDER
THE GUIDELINES SET FORTH BY THE WESTERN AREA POWER
ADMINISTRATION PURSUANT TO THE ENERGY POLICY ACT OF
1992
WHEREAS, on October 24, 1992, President George Bush signed
into law the Energy Policy Act of 1992 (EPA) which amended various
laws, one of which was the Hoover Power Plant Act of 1984 (Hoover Act),
in order to promote energy efficiency by the users of Federal power and
laid the basic groundwork for the deregulation of the electric utility;
and
WHEREAS, the amendments to the Hoover Act required all
Western Area Power Administration (WAPA) customers to prepare an
Integrated Resource Plan (IRP), which is a plan to meet long-term
power resource needs in the most efficient way possible and in
accordance with EPA provisions; and
WHEREAS, the City of Vernon adopted Resolution No. 6532 on
November 1, 1994, determining pursuant to the EPA that Vernon would not
implement 16 U.S.C. 32621(d)(9); and
WHEREAS, effective November 20, 1995, the WAPA Energy
Planning and Management Program (EPAM) adopted EPA mandates for WAPA's
customers to prepare an IRP and established the framework for extension
of firm power resource commitments; and
WHEREAS, on November 5, 1996, the City Council of the City
of Vernon adopted Resolution No. 6879 adopting an IRP for the period
1996 through 2001 under the guidelines set forth by WAPA pursuant to
the EPA; and
WHEREAS, the intent of AB 1890, which was signed into law on
September 23, 1996, was to lower the price of electricity for consumers
by opening California's electric utility industry to competition; and
WHEREAS, effective May 1, 2000, WAPA revised the IRP
regulations to allow its customers the choice of continuing to prepare
IRPs or adopt approaches that are emerging in lieu of IRP
requirements; and
WHEREAS, on November 8, 2001, WAPA granted Vernon's request
to prepare a minimum.investment report for its Public Benefits
Programs in lieu of the IRP requirements; and
WHEREAS, by memo dated December 3, 2012, the.Director of
Light & Power has recommended that the City of Vernon Minimum
Investment Report Five Year Plan FY2013-FY2017 be approved.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON AS FOLLOWS:
SECTION 1: The City Council of the City of Vernon hereby
finds and determines that the above recitals are true and correct.
SECTION 2: The City Council of the City of Vernon hereby
approves and adopts the "City of Vernon Minimum Investment Report Five
Year Plan FY2013-FY2017," a copy of which is attached hereto as
Exhibit A.
SECTION 3: The City Council of the City of Vernon hereby
determines that in the preparation and development of the Minimum
Investment Report there was ample opportunity for full public
participation.
SECTION 4: The City Council of the City of Vernon hereby
directs the Interim City Clerk, or the Interim City Clerk's designee,
to file with WAPA by January 31, 2013, the Minimum Investment Report
_2
Five Year Plan FY2013-FY2017 and a copy of this resolution to the
Western Area Power Administration.
SECTION 5: The Interim City Clerk of the City of Vernon
shall certify to the passage, approval and adoption of this
resolution, and the Interim City Clerk of the City of Vernon shall
cause this resolution and the Interim City Clerk's certification to be
entered in the File of Resolutions of the Council of this City.
APPROVED AND ADOPTED this 18th day of December, 2012.
Name: WilliA J. Davis
Title: Mayor / -a1�f' y—'r--F' �r---�
ATTEST:
Dana R ed, Interim City Clerk
- 3 -
STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
I, Dana Reed, Interim City Clerk of the City of Vernon, do hereby
certify that the foregoing Resolution, being Resolution No. 2012-245,
was duly passed, approved and adopted by the City Council of the City
of Vernon at a regular meeting of the City Council duly held on
Tuesday, December 18, 2012, and thereafter was duly signed by the Mayor
or Mayor Pro-Tem of the City of Vernon.
Executed this day of December 2012, at Vernon, California.
(SEAL)
Reed, Interim City Clerk
- 4 -
CITY OF VERNON, CALIFORNIA
MINIMUM INVESTMENT REPORT: FY2013-FY2017
. EXECUTIVE SUMMARY
The City of Vernon's Public Benefits Program report is prepared in lieu of the five year
Integrated Resource Planning ("IRP") report. The report covers the five-year planning
period from FY 2013-FY 2017. The Public Benefits Program allows the City of Vernon
("Vernon") to meet the objectives of Section 114 of the Energy Policy Act of 1992
through attaining a minimum level of investment in energy efficiency and collecting a
charge to support defined public benefits.
Effective May 1, 2000, the Western Area Power Administration ("WAPA") revised the
IRP regulations to allow its customers more alternatives in meeting the IRP
requirements. Western's customers can choose to continue preparing IRP's, or can
adopt approaches that are emerging in lieu of IRP requirements. These new
approaches are (1) complying with a defined level of investment in demand -side
management ("DSM") and /or renewable energy, including a public benefits program, or
(2) complying with mandated energy efficiency and/or renewable energy activities and
related reporting requirements.
California Assembly Bill 1890 (1890) deregulated the electricity industry and established
non -by -passable Public Benefits Charge("PBC") on all customers' bills in California to
support statewide public benefit programs in energy efficiency, renewable technology,
low-income, and research, demonstration, and development ("RD&D").
In compliance with the requirement of AB 1890, Vernon adopted and implemented
public benefits programs in the area of energy efficiency: Energy Audits, Energy
Education and Demonstration Workshops, Customer Incentive Program, and Customer
Directed Program.
The intent of the energy audit is to identify energy and cost savings for businesses in
Vernon. The on -site energy audit also increases the energy user's attention on how
energy is used thus promoting energy conservation. The findings and
recommendations are delivered to the participating customers. Customers are
encouraged to implement the audit recommendation and participate in the City's
Customer Incentive and Customer -Directed Programs.
The Energy Education and Demonstration Workshops are intended to increase
customers' awareness and promote customer participation in energy efficiency
programs.
The Customer Incentive Program is designed to encourage energy efficient lighting
systems and exploration and implementation of energy efficient technologies. These
technologies may address either equipment or operational change. This program
provides financial incentives (rebates) in two separate areas: lighting and energy
efficient equipment.
The Customer -Directed Program is intended to provide funds for customer -directed
projects involving the use of energy efficient technologies and research, development
and demonstration of energy related technologies. The program offers businesses in
Vernon the opportunity to submit a customized proposal itemizing energy and cost
savings for their facilities. The program permits customers to self design energy
efficiency measures that derive a public benefit.
Future plans include continuing implementation of existing programs with the
commitment to develop and expand the City's renewable energy resources portfolio.
CITY OF VERNON, CALIFORNIA
MINIMUM INVESTMENT REPORT: FY 2013-FY 2017
I. INTRODUCTION
The City of Vernon's Public Benefits Programs report is prepared in lieu of the five year
integrated resource planning (IRP) report. The report covers the five-year planning .
period from. FY 2013-FY 2017. The Public Benefits Programs allow Vernon to meet the
objectives of Section 114 of Energy Policy Act through attaining a minimum level of
investment in energy efficiency and collecting a charge to support defined public
benefits.
In the past, Vernon prepared its IRP pursuant to Western's IRP regulations. IRP is a
planning and selection process for new energy resources that evaluates the full range of
alternatives, including new generating capacity, power purchases, energy conservation
and efficiency, and renewable energy resources, to provide adequate and reliable
service to a utility's electric customer.
Effective May 1, 2000, Western revised the IRP regulations to allow its customers more
alternatives in meeting the IRP requirements. Western's customers can choose to
continue preparing IRPs, or can adopt approaches that are emerging in lieu of IRP
requirements. These new approaches are (1) complying with a_defined level of
investment in demand side management (DSM) and /or renewable energy, including a
public benefits program, or (2) complying with mandated energy efficiency and / or
renewable energy activities and related reporting requirements.
Requirements for the minimum investment report alternative are that the minimum
investment must be either: (1) A mandatory set percentage of customers' gross revenue
or other specific minimum investment in DSM and /or renewable energy mandated by a
State, Tribal, or Federal Government with jurisdictional authority; or (2) A required public
benefits charge, including charges to be collected for and spent on DSM; renewable
energy; efficiency and alternative energy -related research and development; low-
income energy assistance and any other applicable public benefits category, mandated
by a State, Tribal, or Federal Government with jurisdictional authority. On November 8,
2001, the City of Vernon was granted to prepare a Minimum Investment Report for its
Public Benefits Programs in lieu of the IRP requirements.
II. CITY OF VERNON PUBLIC BENEFITS PROGRAMS
A. Legislative Mandate
California Assembly Bill 1890 (AB 1890) was passed by the State Legislature in
August 1996 and signed into law by former Governor Pete Wilson in September
1996. The intent of AB1890 was to lower the price of electricity for consumers by
opening California's electric utility industry to competition. AB 1890 deregulated
the electricity industry and established non -by -passable Public Benefits Charge
(PBC) on all customer bills in California to support statewide public benefit
programs in energy efficiency, renewable technology, low-income, and research,
demonstration, and development (RD&D). The legislation specifies the amount
of money that California IOUs - PG&E, San Diego Gas and Electric, and
Southern California Edison - must collect from ratepayers to fund public benefit
programs, as well as how those funds must be spent.
For publicly owned utilities including the City of Vernon (Vernon) the legislation
contains two mandates. The first one is pursuant to Section 9606, a requirement
to report on the periodic electric bill the amount expected to be transferred to the
general fund on a no less than annual basis.
The second mandate is pursuant to Section 385; a requirement to collect a non -
by -passable usage based PBC on local distribution service to fund investments
in energy efficiency, low-income, renewable energy, and RD&D programs. The
amount that publicly owned utilities must designate for these programs is tied to
historical levels of funding by the IOUs. The legislation was interpreted by the
California Municipal Utilities Association to require publicly -owned utilities to
collect and spend the equivalent of 2.85% of the utility's revenues during the
years 1998 through 2000, and 2.7% of revenues.in 2001.'
Assembly Bill 995, which was approved by the Governor on September 30, 2000,
extended the collection of the non -by -passable PBC through January 1, 2012 at
a rate not to exceed the level that was used to collect these charges on January
1, 2000. Pursuant to the mandates of Assembly Bill 995, a publicly -owned utility
will collect and spend the equivalent of 2.85% of the utility's revenues through
January 1, 2012. The full text of AB 1890, Article 8 is as follows.
Article 8. Publicly Owned Utilities
385. (a) Each local publicly owned electric utility shall establish a non -by -passable,
usage based charge on local distribution service of not less than the lowest expenditure
level of the three largest electrical corporations in California on a percent of revenue
basis, calculated from each utility's total revenue requirement for the year ended
December 31, 1994, and each utility's total annual expenditure under paragraphs (1),
(2), and (3) of subdivision (c) of Section 381 and 382, to fund investments by the utility
and other parties in any or all of the following:
(1) Cost-effective demand -side management services to promote energy- efficiency and
energy conservation.
(2) New investment in renewable energy resources and technologies consistent with
existing statutes and regulations which promote those resources and technologies.
(3) Research, development and demonstration programs for the public interest to
advance science or technology, which is not adequately provided, by competitive and
regulated markets.
(4) Services provided for low-income electricity customers, including but not limited to,
targeted energy efficiency services and rate discounts.
' California Municipal Utilities Association, Energy Services and Marketing Committee, AB1890 Public Benefits
Program Guidebook May 7, 1997. Sacramento, California.
B.
Adoption of Public Benefits Charge
At its meeting on December 16, 1997, the City Council of the City of Vernon
approved implementation of the public benefits charge effective January 1, 1998.
The City Council approved a public benefits charge for electric customers equal
to 2.85% of net revenue collected from such Vernon customers to be used for
certain defined public benefits pursuant to AB 1890. The City of Vernon Council
has approved to continue collecting AB 1890 funds since there is no sunset date
which is described in the Public Utilities Code Section 385.
C. Policy Statement
It is the policy of the City of Vernon to allocate revenues derived from Public
Benefits Charges, less the cost to administer programs, in a fair and equitable
manner
The Public Benefits Programs shall consist of projects conducted by the Utilities
Department and approved projects conducted by other entities under the
supervision of the Utilities Department. Specific projects and expenditures will be
determined according to the following criteria:
1. Consistency with Section 385 of.the Public Utilities Code
2. Input and recommendations by electric utility customers
3. Other public input, and
4. Cost -benefit analysis.
Entities conducting approved projects shall maintain appropriate records to
document project -related expenditures and project -related benefits. These
records shall be available to the Utilities Department upon request. The rapid
growth in demand for electric energy is in part due to wasteful, uneconomic, and
inefficient uses of power. The energy efficiency programs recommended by The
Utilities Department may provide opportunities for participating Vernon customers
to reduce energy usage and costs. As customers become more conversant with
energy management, they may discover new ways to save energy and improve
the bottom line. Low energy costs can improve the competitive position of
businesses. All Vernon electric utility customers may benefit from energy
efficiency programs, as energy efficiency may control rising energy demands,
assisting the City of Vernon to maintain its low energy rates.
D. Approval and Adoption of Public Benefits Programs
Based on customers' response to the survey conducted, the Utilities Department
of the City of Vernon (Utilities Department) assessed customers' needs and
interests and determined that programs in the area of energy efficiency would be
of benefit to electric customers.
The proposed Public Benefits Programs consisted of the following five projects in
the area of energy efficiency.
1. Energy Audits
2. Energy Education and Demonstration Workshops
3. Equipment Loans
4. Customer Incentive
5. Customer Directed Projects
At its meeting on March 21, 2000, the City Council of the City of Vernon
approved and adopted the Public Benefits Programs and authorized for
implementation at that time two of the five projects contained in the Public
Benefits Programs, the Energy Audits and the Energy Education and
Demonstration Workshops.
Later, at its meeting on September 19, 2000, the City Council approved and
authorized for implementation at that time two of the three remaining projects
contained in the Public Benefits Programs, the Customer Incentive Program and
the Customer Directed Program, with the one remaining program to be
implemented when it is completed.
E. Implementation
Vernon's Public Benefits Program consist of four categories: 1) Energy Audits; 2)
Customer Incentive Program;3)Energy Education and Demonstration
Workshops and 4) the Customer Directed Program. Each of these programs is
outlined below. For the period from 2012-2016, the City of Vernon continues to
rely on these programs to achieve demand side management.
1. Energy Audits
Vernon offers energy audits to all commercial and industrial customers.
The intent of the audit is to identify energy and cost savings for
businesses in Vernon. On -site energy audit also increases the energy
user's attention on how energy is used thus promoting energy
conservation.
Energy audits include three key parts:
Data gathering: identification of where and how a structure, process or
equipment uses energy, along with the costs and utility uses affecting
the energy usage;
• Data analysis: identification of energy conservation measures that
when implemented, will make the energy usage more efficient, less
expensive or more environmentally friendly; and
• Recommendations: a final report detailing the findings, areas for
improvement and recommended actions accompanied by some type of
economic justification.
A team of energy professionals conducts an on -site review and analysis of
customers' energy usage patterns and recommends energy efficiency
measures.
An energy audit report is prepared and delivered to participating
customers approximately thirty days after the facility review. Utilities staff
delivers and reviews the audit findings with participating customers and
promotes the interface between the audit findings and other Public
Benefits Programs.
Conformance of the Energy Audit Program with the Intent of AB
1890
The Energy Audit Program provides interested Vernon utility customers
with the initial energy usage analyses needed to develop a broader
energy management plan. Informed decision -making is a critical first step
to implementing energy efficiency and conservation measures, which are
key objectives of the Public Benefits Programs required by AB 1890.
Activities and Results
As of the fiscal year ending June 2012, one energy audit was
performed. The findings and recommendations are delivered to the
participating customers. Customers are encouraged to implement
the audit recommendation and participate in the City's Customer
Incentive and Customer Directed programs.
The following table summarizes recommended measures and the
intended benefits.
The following table summarizes recommended measures and the associated benefits.
Table 1 - Audit Recommendations
Recommended Measure Estimated Demand Reduction (kW) Estimated Energy
Saving kWh
Lighting
57
316,671
Occupancy Sensors
0
20,042
Air Compression
6.67
34,684
HVAC
1.31
6,807
The intent of energy audit is to first analysis the energy consumption
at the customers facility. This analysis includes proportional estimates of
the major components of electricity consumption. This information will
enable both corporate and facility management to better understand the
energy use at the facility, which in turn will enhance the ability of personnel
to focus on prudent and productive energy conservation actions, whether
temporary or permanent.
2. Customer Incentive Program
The Customer incentive Program objectives are as follows:
Promote long-term energy efficiency by encouraging commercial and
industrial customers to implement energy efficiency measures that
exceed the minimum standards established by Title 24 of general
industry standards;
• Provide incentives for customers to apply the latest technology and
energy using devices that are otherwise cost -prohibitive;
• Promote economic development and business retention by serving as
an instrument to attract and retain customers who will enjoy the long-
term benefits of energy efficiency.
The Program is designed to encourage energy efficient lighting systems
and the exploration and implementation of energy efficient technologies.
Often the latter technologies are overlooked because customers are either
unfamiliar with them, think they are too costly to apply at their facilities, or
do not believe such technologies can effectively meet their energy needs.
These technologies may address either equipment or operational change.
If the Department can quantify a demand reduction and /or energy
savings, financial incentives to assist customers are justified.
This program provides financial incentives (rebates) in two separate
areas, lighting, and energy efficient equipment.
The lighting incentive portion of the program is designed to provide a cash
incentive to Vernon customers interested in implementing the latest
lighting technology. Developments in technology have produced new
LED's, including T-5 fluorescent lamps, electronic ballasts, and more
affordable compact fluorescent lamps that use less energy and last longer.
The lighting incentive portion of the program provides rebates of $0.075
per kWh of reduced lighting energy usage. The maximum incentive for
lighting improvements by qualified customers during a one-year period is
$75,000 or 50% of the lighting retrofit cost, whichever is less.
The non -lighting incentive portion of this program can include, but is not
limited to: variable speed drives, air compressors, motors, refrigeration,
chiller replacement, and building envelope. The Incentive Program also
includes energy management systems and other load and energy
controlling devices. The following is a discussion of the measures and
incentives covered under the non -lighting portion of the Customer
Incentive Program:
Motors - Rebates are based upon qualifying equipment exceeding the
standards set by the National Energy Policy Act (NEPA) passed in
October 1997. Customers receive $150/kW of reduced demand above
NEPA standard whether the motor is new or a replacement.
The following two tables list minimum qualifying motor efficiencies.
Table 2. Open Motors Minimum Qualifying Efficiency
Hp
2 Pole
4 Pole
6 Pole
8 Pole
1.0
-
82.5
80.0
74.0
1.5
82.5
84.0
84.0
75.5
2.0
84.0
84.0
85.5
85.5
3.0
84.0
86.5
86.5
86.5
5.0
85.5
87.5
87.5
87.5
7.5
87.5
88.5
88.5
88.5
10.0
88.5
89.5
90.2
89.5
15.0
89.5
91.0
91.0
89.5
20.0
90.2
91.0
91.0
90.2
25.0
91.0
91.7
91.7
90.2
30.0
91.0
92.4
92.4
91.0
40.0
91.7
93.0
93.0
91.0
50.0
92.4
93.0
93.0
91.7
60.0
93.0
93.6
93.6
92.4
75.0
93.0
94.1
93.6
93.6
100.0
93.0
94.1
94.1
93.6
125.0
93.6
94.5
94.1
93.6
150.0
93.6
95.0
94.5
93.6
200
94.5
95.0
94.5
93.6
250
94.5
95.4
95.4
94.5
300
95.0
95.4
95.4
350
95.0
95.4
95.4
400
95.4
95.4
450
95.8
95.8
500
95.8
95.8
Motor efficiencies stated at 100% load
12
Table 3. Enclosed Motors Minimum Qualifying Efficiency
Hp
2 Pole
4 Pole
6 Pole
8 Pole
1.0
75.5
82.5
80.0
74.0
1.5
62.5
84.0
85.5
77.0
2.0
84.0
84.0
86.5
82.5
3.0
85.5
87.5
87.5
84.0
5.0
87.5
87.5
87.5
85.5
7.5
86.5
89.5
89.5
85.5
10.0
89.5
89.5
89.5
88.5
15.0
90.2
91.0
90.2
88.5
20.0
90.2
91.0
90.2
90.2
25.0
91.0
92.4
91.7.
89.5
30.0
91.0
92.4
91.7
91.0
40.0
91.7
93.0
93.0
91.0
50.0
92.4
93.0
93.0
91.7
60.0
93.0
93.6
93.6
91.7
75.0
93.0
94.1
93.6
93.0
100.0
93.6
94.5
94.1
93.0
125.0
94.5
94.5
94.1
93.0
150.0
94.5
95.0
95.0
93.6
200
95.05
95.0
95.0
94.1
250
95.4
95.0
95.0
94.5
300
95.4
95.4
95.0
350
95.4
95.4
95.0
400
95.4
95.4
450
95.4
95.4
500
95.4
95.8
Motor efficiencies stated at 100%`load.
Air Compressors - Rebates are based upon the efficiency on the installed
device. There are two sets of efficiencies for two different types of air
compressors oil flooded and oil free. The rebate is $150/kW of reduced
demand above the set standard for new or replacement air compressors.
The following table lists qualifying efficiencies for air compressors.
Table 4. Air Compressors Qualifying Efficiencies
TYPE SIZE
EFFICIENCY
(ACFM/BHP)
Oil Flooded Below 50 HP
3.6
50 to 100 HP
4.2
Above 100 H P
4.6
Oil -Free Below 50 HP
3.2
50 to 100 HP
3.7
Above 100 HP
4.1
Other Equipment - Rebate is based upon $200/kw of reduced demand or
$0.075/annualzed kWh saved, whichever is greater., for replacement of
existing equipment. Saving is established either through customer
metering of .load for the existing and new machines or by the Department's
calculation of savings.
Air Conditioning - All qualifying electric air conditioning equipment
(including heat pumps) that are installed as replacement equipment
qualifies for rebates based on cooling capacity. Rebates for customers
range between $75 and $150 per ton. The following table shows rebate
amounts for the air conditioner replacement program
Table 5. Rebates for Air Conditioner Replacement Program
Type
Size
Efficiency
Rebate
(Btu/hr)
(EER)
($/ton)
Through the Wall Air
Less than 65,000
8.7 and above
$75
Conditioner
Air -Cooled Central
Less than 65,000
11 - 11.9
$75
Package & Split System
12 - 12.9
$100
13 and above
$150
65,000 - 135,000
9.2 - 9.4
$75
9.5 - 9.9
$100
10 and above
$150
135,000 - 760,000
8.7 - 8.9
$75
9.0 - 9.5
$100
9.6 and above
$150
760,000 and greater
8.4 - 8.6
$75
8.7 - 9.2
$100
9.3 and above
$150
Other Unspecified Measures - All other measures not specified above that
qualify (including building envelope, refrigeration equipment and
operational modification, motor controllers, variable volume pumps,
variable speed drives, chiller replacement, etc.) earn rebates in the
following manner:
1. $200/kW reduced demand or
2. $0.075 per annualized kWh saved
The greater of the two methods for determining rebates is applied at the
Department's discretion.
The maximum rebate per customer for all measures under the non -lighting
portion of the program is the lesser of $75,000 or 50% of the investment
(material, labor and taxes).
In addition to cash incentives, the Customer Incentive Program includes
funding for feasibility studies. The feasibility study is often the first step in
determining whether a particular technology applies to a specific operation
or energy -using device. Feasibility studies are limited to a maximum of
$10,000 per project.
Activities and Saving Results
The following table is a summary of measures implemented under the
Customer Incentive Program from FY 07/08 thru FY 11/12
Table 6. Implemented Measures
Implemented
Demand
Energy Reduction
City Rebate
Measure
Reduction (KW)
(KWh)
Amount
Lighting Retrofit
1633
10,997,448
$835,058
AC/Air
18
56,378
$15,112
Compressors
Replacement
Total
1651
11,053,826
$850,170
3. Energy Education and Demonstration Workshops
A necessary first step to promoting energy efficiency measures among
utility customers is creating heightened awareness for the existing
,opportunities. The "market transformation" intended by AB 1890 begins
with imparting the knowledge and tools crucial for customers to become
active participants and beneficiaries of the Public Benefits Programs.
The Energy Education and Demonstration Workshops are intended to
increase customers' awareness and promote customer participation in
energy efficiency programs. Vernon hosts several energy efficiency
workshops with presentations and discussions on various topics lead by
energy experts.
The workshops cover a variety of topics relative to energy efficiency and
current technologies. The range of topics are based on customer survey,
discussions with a cross section of Vernon's electric utility customers, and
the projected need of Vernon's customer base.
4. Customer - Directed Program -
The Customer -Directed Program is intended to provide funds for
customer -directed projects involving the use of energy efficient
technologies and research, development & demonstration (RD&D) of
energy related technologies. The following are the objectives of the
program:
• Help business customers develop sound and effective energy projects to
grow their businesses through appropriate strategies and partnerships.
• Increase the efficiency and productivity of energy use, while limiting
environmental impacts.
• Support the development and demonstration of new energy technologies
and products for business opportunities.
• Stimulate increased energy efficiency in buildings and operations and the
increased use of alternative energies.
• Lead community efforts to develop and utilize efficient energy
technologies and to accelerate their acceptance and use at the community
level.
• Strengthen working relationships and networking among the business
community in Vernon.
The
Customer-Directed Program offers businesses in Vernon the opportunity to ,
submit a customized proposal itemizing energy and cost savings for their
facilities. The program permits customers to self -design energy efficiency
measures that derive a public benefit. Projects may fall within one of the
following two categories:
1. In-house opportunities
In-house opportunities consist of installing or retrofitting companies'
facilities with RD&D technologies. Some examples may include
photovoltaic systems, electric vehicles charging systems, heat retention
electro-technologies, and energy efficient or new energy technologies that
are applies to facilities and/or processes:
2. Product Commercialization
Product commercialization consists of developing new technologies that
will be used for production and sale. These items will most likely fall in the
RD&D category and must be energy related. Products must be ready for
testing and/or production to be considered for funding. Some examples of
past technologies that were developed for commercialization include:
nickel -metal hydride batteries; aerosol duct sealer, which plugs air leaks in
duct systems; and compact fluorescent lights.
The program funds up to $150,000 or 50% of total project cost for each
project selected that demonstrates energy -related and/or future
commercial potential in the area of energy efficiency. The customer must
provide at least twenty-five percent of the total project cost.
III. PUBLIC BENEFITS CHARGE AND EXPENSES
1.0 Public Benefits Charge
Pursuant to the mandates of Assembly Bill 1890 and as amended by Assembly
Bill 995, the City of Vernon assesses a charge of 2.85% the total customer's bill
before any special fees or charges. The following table shows Public Benefits
charge collected by fiscal year (July 1 through June 30) starting from 7/1/07
through 6/30/12.
Public Benefits Charge Collected
FY 07/08
FY 08/09
FY 09/10
FY 10/11
FY 11/12
$ 2,770,954
$ 2,985,456
$ 2,959,026
$3,010,805
$3,442,913
2.0 Public Benefits Programs Expenses
Up until recently most of the work has been in the area of assessing and
developing public benefits programs. The following table shows Public Benefits
Programs expenses by fiscal year (July 1 through June 30) starting from 7/1/07
through 6/30/12.
RD&D Investments
The City of Vernon purchased land in the Tehachapi Mountains in Kern County,
California with the intent to develop a wind farm project. This project is currently
In the early data collections and research stages.
Public Benefits Programs Expenses
Description
FY 07/08
FY 08/09
FY 09/10
FY 10/11
FY 11/12
Salaries and Benefits
$47,940
$60,838
$54,269'
Energy Audits
$10,000
$19,010
Misc.
$2,600
$92
Rebate Amount
$39,622
$60,259
$271,459
$156,089
$320,741
RD&D Investments
$26,184,000
Totals
$52,222
$60,351
$319,399
$216,927
$26,578,020
IV. Future Plans
1.0 Existing Programs
As part of its future plans, the City of Vernon Light & Power Department
will continue to implement existing programs. Great efforts will be
expended on encouraging customers to implement energy efficiency
projects & energy audits.
2.0 Renewable Portfolio Standard (RPS)-Senate Bill 1078 (SB 1078)
This law defines qualified renewable energy resources and requires the
State's Investor Owned Utilities to increase total procurement of eligible
renewable energy resources at least by an additional one percent of retail
sales per year so the 20% of retail electric sales are procured from eligible
renewable energy resources by December 31, 2017. SB 1078 defines
eligible renewable energy resources as in -state electric generating
facilities using one of the following technologies: photovoltaic, wind, solar
thermal, biomass, geothermal, small hydropower of 30MW or less, waste
tire, digester gas, landfill gas, and municipal solid waste generation
technology. For local publicly owned electric utilities such as the City of
Vernon, the law requires the following:
• The governing body of a local publicly owned utility is,
responsible for implementing and enforcing a Renewable
Portfolio Standard (RPS) that recognizes the intent of the
legislature to encourage renewable energy resources taking
into consideration the effect on rates, reliability, financial
resources and the goal of environmental improvement,
• Each local publicly owned utility must report to its customers
annually: 1) expenditure of public benefits funds collected for
renewable energy resources including a description of each
program and the expected or actual results and 2) the
resources mix by fuel type including contribution of renewable
energy resources to the mix.
The RPS represents the City of Vernon commitment to renewable energy
resources procurement consistent with the legislative intent of SIB 1087.
The City's resource mix will consist of the electricity from "eligible"
renewable energy resources of 20% by 2017. Qualifying renewable
energy resources from the "eligible" list consist of: hydroelectric
generation, photovoltaic, wind, solar thermal, biomass, geothermal, fuel
cells using renewable fuels, renewable distributed generation on the
customer side of the meter, waste tire, digester gas, landfill gas and
municipal solid waste generation technology. The City of Vernon will place
emphasis to locate local renewable energy resources with the City's limits,
particularly on City -owned facilities and their local power plant. One
particular project that the City has been planning is the use of biomethane
fuel at the local power plant which will utilize the plant to its full capacity.
Recently, the City purchased land in the Tehachapi Mountains in Kern
County, California with the intent to develop a wind farm. This project is
the beginning stages of development.
3.0 City of Vernon Solar Incentive Program -Senate Bill 1 (SB1)
This legislation requires the governing body of a local publicly owned utility
such as the City of.Vernon ("City") to adopt, implement and finance a solar
initiative program for the purpose of investing in and encouraging the
increased installation of residential and commercial solar energy systems
by January 8, 2008.
A local publicly owned electric utility is required to offer monetary incentives
for the installation of solar energy systems of at least two dollars and eighty
cents ($2.80) per installed watt, or for the electricity produced by the solar
energy system, measured in kilowatt-hours, as determined by the
governing board of a local publicly owned electric utility, for photovoltaic
solar energy systems. The incentive level shall decline each year thereafter
at a rate of no less than an average of 7 percent per year. Further, the
legislation requires a local publicly owned electric utility to initiate a public
proceeding to determine what additional funding, if any, is necessary to
provide the incentives pursuant to the legislation. The City of Vernon Solar
Energy and Net Metering Program is intended to encourage increased
installation of residential and commercial solar energy systems. The
program offers monetary incentives to eligible customers in City of Vernon
territory. The City currently has one customer that installed a Solar system
with the capacity of 30 KW. The hope is that the City continues to add
more customers to its portfolio.
4.0 Energy Efficiency Upgrades Saving from Transmission & Distribution
In addition to achieving efficiency through its Public Benefits Programs, the
City of Vernon has been successful focusing on improving energy
efficiency of its electric distribution system. Some of the long term plans
include is to rebuild the City's 7 KV and16 KV circuits from its
substations by installing new conduit, manhole system and new cabling
which would extend the life of the City of Vernon distribution system.
The City of Vernon is also adding new switching capacitor banks
throughout its distribution system which will improve the City's overall
power factor.
5.0 City of Vernon Street Lighting replacement with LED's
For several decades high pressure sodium lamps have been considered a
standard for roadway lighting around the world. With emerging advances
in LEDs technology, the City of Vernon has committed itself and will
evaluate and study replacing all street lighting fixtures with LEDs. This
project is in the commencement stages but the energy savings could have
an immense impact in KWh savings for the City of Vernon.
CITY CLERK'S OFFICE
INTER -OFFICE MEMORANDUM
DATE: December 20, 2012
TO: Carlos Fandino, Director of Light & Power
FROM: Deborah Juarez, Records Management Assistant
RE: Resolution No. 2012-245 - A Resolution of the City
Council of the City of Vernon Adopting a City of
Vernon Minimum Investment Report Five Year Plan
FY2013-FY2017 as an Alternative to an Integrated
Resource Plan Under the Guidelines Set Forth By the
Western Area Power Administration Pursuant to the
Energy Policy Act of 1992
Transmitted herewith is a copy of Resolution No. 2012-245 with
the Minimum Investment Report attached as Exhibit A, approved on
December 18 2012.
Please send a copy of the communication used to transmit the
report to WAPA to.the City Clerk's office for the file.
c: Anthony Serrano
Resolution No. 2012-245
RECEIVED
DEC 10 2012
cep - -
40
STAFF REPORT
LIGHT &POWER
DATE: December 3, 2012
TO: Honorable Mayor and City Council
FROM: Carlos Fandino Jr., Director of Light & Powero1-
RE: City of Vernon Minimum Investment Report
FY 2013 — FY 2017 Five Year Plan
PURPOSE
RECEIVED
DEC 0 5 2012
CITY ADMINISTRATION
On January 22, 2002, City Council adopted Resolution No. 7900 establishing City of
Vernon Minimum Investment Report as an alternative town Integrated Resource Plan
under the guidelines set forth by the Western Area Power Administration (WAPA)
pursuant to the Energy Policy Act of 1992.
Attached is the City of Vernon Minimum Investment Report Five Year Plan covering the
period FY 2013 to FY 2017, which needs to be filed with WAPA by January 31, 2013.
RECOMMENDATION
The Light and Power Department recommends that:
1. At the December 18, 2012 meeting, City Council approves the implementation of
the City of Vernon Minimum Investment FY 2013 thru FY 2017 Five -Year Plan.
2. City Council authorizes staff to submit annual updates. to Western Area Power
Administration (WAPA).
CRF:ah
Attachments