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HomeMy WebLinkAbout05.17.2019 IMC Meeting MinutesAlaska Intertie Management Committee Friday, May 17, 2019 Alaska Energy Authority Board Room 813 West Norther Lights Boulevard, Anchorage, Alaska 99503 1. CALL TO ORDER Chair Brian Hickey called the meeting of the Alaska Intertie Management Committee to order on May 17, 2019, at 9:03 a.m. A full quorum was established. 2. ROLL CALL FOR COMMITTEE MEMBERS Members present: Brian Hickey (Chugach Electric Association); Leo Quiachon (Golden Valley Electric Association) (phone); Tony Izzo (Matanuska Electric Association); Jeff Warner (Anchorage Municipal Light & Power); and Kirk Warren (AEA). 3. PUBLIC ROLL CALL Public present in Anchorage: Sunny Morrison (Accu-Type Depositions); Owen Berklund (AEA); Jocelyn Garner (AEA); David Lockard (AEA); Beazit Redzepi (sp) (AEA); Curtis Thayer (Arrived 9:20 a.m.) (AEA); Brandi White (AEA); Stefan Saldanha (Department of Law); Russ Thornton (Chugach Electric Association (CEA)); John Foutz (City of Seward); Dan Bishop (phone) (Golden Valley Electric Association (GVEA)); Cory Borgeson (phone) (GVEA); Peter Saravan (sp) (GVEA); Kirk Gibson (phone) (McDowell Rackner & Gibson PC); Ed Jenkin (Matanuska Electric Association (MEA)); Jay Layne (phone) (Regulatory Commission of Alaska (RCA)); and Bernie Smith (Public). 4. AGENDA APPROVAL MOTION: Mr. Izzo made a motion to approve the agenda. Motion seconded by Mr. Warner. The motion was approved unanimously. 5. PUBLIC COMMENTS 6. APPROVAL OF PRIOR MINUTES - March 22, 2019 MOTION: Mr. Warner made a motion to approve the March 22, 2019 minutes. Motion seconded by Mr. Izzo. The motion was approved unanimously. 7. NEW BUSINESS 7A. Approve FY20 Preliminary Operating Budget for Public Comment - Budget Subcommittee AIMC Draft Meeting Minutes -May 17, 2019 Page 1 of 5 Chair Hickey requested Jocelyn Garner, AEA Budget Subcommittee, to present the FY20 preliminary operating budget. Ms. Garner noted the preliminary budget is included in the member packet and will go out for the 30-day public comment period after today's approval. A meeting will be scheduled at the conclusion of the public comment period to approve the budget. Ms. Garner described the line item under FERC 570 entitled GVEA - Healy, Teeland, Goldhill Dampers is listed in the budget at $50,000. The Intertie Operating Committee (IOC) updated the project budget estimate to $150,000, and recommends the amount be changed in the preliminary budget. GVEA issued a request for proposal (RFP) for repairs at all three sites and a contractor returned a proposal for the scope at $150,000. Mr. Warner discussed the manufacturer is GE. He explained the airflow dampers are associated with the SVCs at all three sites. Mr. Quiachon recognizes the line item is a necessary fix for the SVC. However, the scope of the work, including the actual value to the warranty, has not been delineated. He commented AEA has not followed through with the requested pursuit regarding the warranty issues with the manufacturer GE regarding the initial SVC damper repairs. GVEA recommends keeping the budget line item at $50,000 until further clarification is received from GE regarding the warranty status. If additional funding is needed, the item can be addressed in the 2020/2021 budget. Mr. Warren requested David Lockard, AEA and IOC, to comment. Mr. Lockard informed GE performed repairs on the installed SVC dampers during the warranty period. Additionally, a contractor was hired by GVEA to perform repairs independently of GE. The original warranty period and the warranty period after the GE repairs have expired. It appears there may be a common problem with the dampers that could be the basis of a claim. Mr. Lockard noted the claim would be decided within the legal process. Mr. Warren agreed with Mr. Quiachon's recommendation to keep the budget line item at $50,000 until further clarification can be sought. Kirk Gibson, McDowell Rackner & Gibson PC, agreed with Mr. Quiachon's recommendation. Mr. Gibson noted the amount is de minimis. Ms. Garner highlighted another line item in the preliminary budget under FERC 571 entitled MEA - Equipment Repair and Replacement is stated at $581,000. Previous discussion occurred within the Budget Subcommittee regarding the possibility of a lowered amount. However, the IOC recommends the budgeted amount remains. Chair Hickey requested Ed Jenkin, MEA and Chair of IOC, comment on the recommendation. Mr. Jenkin explained various warning marker balls that were in place at the time of installation are now missing. This is a recognized liability issue. The project to replace the warning marker balls is scheduled to begin next summer and could possibly slip into the next budget cycle. Mr. Quiachon commented GVEA recognizes the safety hazard that is posed by the missing marker balls. GVEA recommends an overall study of the entire intertie be conducted prior AIMC Draft Meeting Minutes -May 17, 2019 Page 2 of 5 to moving forward in order to provide an economy of scale by addressing the whole project at once. Chair Hickey requested clarity if the missing marker balls present safety problems or if this is general maintenance activity. He believes safety problems should be addressed immediately. Mr. Jenkin noted the Maintenance Subcommittee could conduct a full report of all locations and present the findings to members. Chair Hickey noted he will make an assignment for the Maintenance Subcommittee to provide an evaluation and prioritization of the known locations before the next committee meeting. Discussion and concurrence was reached regarding addressing safety issues immediately. Ms. Garner recommended the language under administrative costs in FERC 566 be changed from Miscellaneous Studies to Miscellaneous System Studies, and to remove the listing of the actual prior budget studies. No comments were made. Ms. Garner noted the LIDAR survey line item for $300,000 is also up for discussion today. Mr. Warner explained the IMC assigned the IOC to determine the cost of the LIDAR survey. MUP met with a potential bidder and received additional information from HEA regarding their LIDAR survey experience. Based on the information, the cost of $300,000 was determined and is included in the preliminary budget. Who will administer the survey has not been decided. Mr. Quiachon agrees LIDAR would add extreme value to the intertie. The issue is determining the appropriate budget line item under which the project oversight is placed. He noted the possibility of directly assigning one of the utilities to oversee the LIDAR survey versus AEA overseeing the survey. Chair Hickey requested Ms. Garner provide members with the description of the uniform system accounts for FERC 566 and 571 before the next meeting. Ms. Garner noted the LIDAR survey is within the administrative costs because surveys are considered to be miscellaneous transmission expenses under the Intertie agreement. She will verify the budget classification is correct. Ms. Garner reviewed the utilities' usage rate and capacity rate calculations shown on page two, entitled Alaska Intertie Fiscal Year 2020 Energy Projection. Ms. Garner described the minimum intertie transfer capability rights (MITCR) calculations for FY20. MOTION: Mr. Izzo made motion to approve the amended FY20 Preliminary Operating Budget for the 30-day comment period. Motion seconded by Mr. Warner. The motion was approved without objection. 8. REPORTS 8A. Budget to Actual Report - Budget Subcommittee Ms. Garner presented the Budget to Actual Report for the period July 1, 2018 through February 28, 2019. The actual revenues to -date was $2.3 million. The actual expenses to- AIMC Draft Meeting Minutes -May 17, 2019 Page 3 of 5 date was $570,000. The current surplus was $1.7 million. The budget has been adjusted to collect less revenue. The refund will be minimized after the expense reports for March, April, May, and June are received. Any work completed in 2019 will be applied to the 2019 budget. The contractor for the repair tower 748 has updated its schedule and will mobilize next week Foundation work should be complete by June 1. 8B. Operators Reports - ML&P / GVEA Mr. Warner provided the Operators Report and highlighted the predicted significant delta between the first quarter of 2018 and the first quarter of 2019. The intertie trend usage has decreased and is more likely to be lower than higher going forward. Mr. Warner explained the manual trips listed in the report. There was an effort to coordinate a Railbelt stability testing for the oscillation study. Mr. Warner reviewed the first quarter reportable trips. He noted the formatting issue with the report of events will be corrected. There were no questions. 8C. Intertie Operating Committee Report Mr. Jenkin provided the IOC Report and highlighted specific requests from the IMC. A review and discussion of the data exchanged by the utilities through ICCP is ongoing by the SCADA and Telecommunications Subcommittee. The final review of the Alaska Critical Infrastructure Protection (AkCIP) standards has been completed by the IOC and the recommendations will be presented at the upcoming Railbelt Utility Managers (RUM) meeting. Next steps will then be determined. Any changes will be reviewed by the IOC and brought before the IMC. Chair Hickey requested additional information regarding the cyber security AkCIP standards. Mr. Jenkin noted the IOC reviewed the cyber security standards and provided recommendations and modifications. Chair Hickey asked John Foutz, City of Seward, to provide an update. Efforts are ongoing for the recommended cyber security AkCIP standards to be presented as a discussion item at an upcoming RUM meeting. Mr. Jenkin commented the intertie usage projections are decreasing. The 10-year projections are being developed. Discussions continue regarding alternate means of value allocation. The current reserve allocations are similar to current usage amounts. The IOC will continue to monitor the Railbelt initiatives and consider those impacts for future recommendations. 9. COMMITTEE ASSIGNMENTS Chair Hickey made assignments. The IOC will oversee the review of the damper issue related to the SVC and provide analysis regarding delaying the process. An update on the GE warranty will be given, as well as recommendations for immediate work. The IOC will oversee the review of locations and prioritization of the marker ball issues on both the northern and southern parts of the line. Replacements that need to occur this year will be identified. AIMC Draft Meeting Minutes -May 17, 2019 Page 4 of 5 The IOC will evaluate the sequence of events that occurred on the intertie during the earthquake. 10. NEXT MEETING DATE - July 26, 2019 The next regular meeting will be scheduled after the 30-day notice period has expired and before the June 30, 2019 deadline. Members will be notified. 11. ADJOURNMENT There being no further business of the AIMC, the meeting adjourned at 9:56 a.m. I . Brian "Ic 4!Z/ILGtA ISWregky AIMC Draft Meeting Minutes -May 17, 2019 Page 5 of 5