BOARD OF PUBLIC UTILITIES  ~  WORK SESSION
OCTOBER 1, 2025  ~  5:30 P.M.
LOS ALAMOS COUNTY, NM  ~  MUNICIPAL BUILDING  ~  COUNCIL CHAMBERS


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Anyhow, but we hope everybody, or people can check in by Zoom as much as possible when they're not physically here.

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Anyhow, uh, first order of business is public comment. Do we have any public comment?

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I don't see any in chambers. Thank you, Chair Gibson, for anybody joining us tonight on Zoom, if you'd like to make public comment, please use the raise hand function.

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And if you're participating by phone, that's star 9. If anybody would like to make a public comment, please raise your hand.

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Does it look like we have public comment, Chair Gibson? Okay, thank you very much.

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We do… did have a closed session last evening, and I'd like to read a statement on that.

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The matters discussed in the joint closed session with County Council.

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Held on September 30, 2025, began at 4pm. We're limited only to the topics specified in the notice of the closed session.

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And no action was taken on any matter in the closed session.

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We request that this statement be included in the meeting minutes.

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Um, is there a motion to approve the agenda this evening?

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Sure, I'll make a motion to approve the agenda. Thank you.

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Okay, agenda approval is… Moved and seconded.

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All in favor? Proposed.

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Okay, motion passes 5-0. And that takes us immediately to our first business item.

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An upgrade on the integrated resource plan. An implementation of it, and the plan for Foxtail Flats.

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As well as a little bit of discussion about Elvado. So, Ben.

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Thank you. Chair Gibson, members of the board, Ben Ulbrich, Deputy Utility Manager for Power Supply. Happy to be here before you today. This is the latest installment of our.

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Roughly 6-month, uh, rate, repeating. Progress meetings on achieving our integrated resource plan portfolio.

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Now, with the caveat that we've deviated entirely from. What was planned in the IRP, but with that being said, we do plan on getting a new IRP as soon as we can.

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Let's see if I can get this to work. All right, so in the past, I've given you a rundown on.

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All the resources that we're. Currently pursuing… Sorry, Ben, before you get started, is there a way to get these… the slides projected on these computers?

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It's not on our screens here. We're seeing a screensaver.

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There was a big on-off button I would press it.

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Well, in any case, I don't want to hold this up any more than these technical difficulties require, so I'll just go over the first slide here. You really don't even need to see it, but.

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Um, in the past, I've covered a lot of all the resources that we were pursuing.

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Um, and what we've done in the past, and how we're moving forward. This is more tightly focused, simply looking as.

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As Chair Gibson mentioned, at Foxtale Flats, what our plans are for that, and uh… higher level, and in the future, we're gonna refine that as we go forward.

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And second, it's gonna have a little piece on… Elvado, and the Hydros, both of the hydro facilities, and kind of a high-level economic review of.

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What it's cost us over the past 3 years to… run the facilities, and how much generation we've got out of them, and what that works out to at a.

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Dollar cost per megawatt hour. For the generation from those two facilities combined.

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And we have a comment on Zoom. Jonah Ahrens would like you to define LRSAP, and CGTG.

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And a few other acronyms when you get to them. All right, I can do that. Thank you.

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Since those ones were specifically mentioned, and we're still working here on the technical difficulties, I will say LRS stands for Laramie River Station.

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Which is the coal-fired power plant of which we have a 10 megawatt.

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Market participation share for power out of that facility, and that is located in Wheatonland, Wyoming.

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Ep stands for Electric Production, which is the name of the division that I run.

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Even though my title is. Your Deputy Utility Managers for power supply. My division is called Electric Production.

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Which I will point out. Doesn't include the fact that I also do all the gas.

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Scheduling. Um, there was another one she mentioned that I don't recall. Like, BESS is Battery Electrical Storage System, or Energy. Battery Energy Storage System.

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And then the combined gas. And there was, yes, the CGTG was a combustion gas turbine generator.

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And KISO. Kiso is California Integrated System. Operator. And then the last one is FTF.

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Ftf, Foxtail Flats, I believe. Thank you. I didn't think I used that one in there, but apparently I did.

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I try to avoid acronyms where possible. So, thanks for the question.

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So, the last time I gave this, uh, update was on April 2nd, 2025.

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So, what's that for? Roughly… Six months ago, so… I'm on schedule here.

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We're still working through the issue? Just keep going. I'll just keep going then. Do we know if people who… anybody who's looking at it online, if they're seeing.

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What's up there, or what's down here? Okay.

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Good, okay. We'll just pretend we're in the movie theater. It's a little hard for the Knicks of the people who are right against the screen. Well, I have a hard copy, so I'm good. Perfect.

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All right, and if anybody needs me to stop and say what they're looking at, just go ahead and let me know.

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And as Chair Gibson asked me earlier, I welcome any questions as you get them, feel free to interrupt me. I want to, you know, get the answers to you when you're thinking about them, and we can have the.

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The dialogue right then and there, rather than asking you to hold them.

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The land lease approval for Foxtale Flats was delayed. If you add it all up now, to approximately 10 months. The lease is now complete.

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Um, they got their final approvals, went through the review periods, and it's done.

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Um, that's a go. Ben, I'm so sorry to ask a question right off the bat and slow you down. Give it, Jim. But, uh… that, uh, land lease we got in, as I understand it, came in August.

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And the, kind of, the original plan to date was the end of December last year. That's only 8 months.

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Or the extra 2 months come from? December was their deadline when they expected to have everything done.

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Um, they really only didn't get it done until this last month.

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Finally. It was August when that came through, I believe. Right, but there was also an appeal.

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Period. Yeah, but that was… that's when the appeal ran out. They actually got the Fonzie in July.

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So… and my understanding is that the land lease was signed very quickly, like a day or two thereafter, in August.

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So, that's 8 months. They're rolling in all the delays they had for their design into that.

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Into that process. And that's understandable. They couldn't do a lot of their procurement and engineering at their financial risk until they had the surety of their lease in place, and then they could mobilize their teams to get started.

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So, I don't… I don't necessarily hold that against them on, you know.

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Adding that extra period in there. That's my personal thing.

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You know, legally, um, contractually, I do believe they have that.

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That is allowed for under the Excused Delay Clause. So there's absolutely no more approvals that need to be done, then?

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From the land lease standpoint, that's it, I believe, and that's the last one. The interconnection agreement with PNM, that's all settled years out… years ago. Years ago, okay. So as far as I'm aware.

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Um, they're ready to roll. Now, new market, new tariffs, new risks may arise. I can't speak to that.

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However, a lot of those things are not covered under the Excused Delay Clause.

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Um, specifically the lease was called out as one of the criteria for.

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An excused delay, and that's what they called on.

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Cool. Satisfied? Alright, good. Well, I'm not satisfied, but I've got the answer. Answer answers as good as it's gonna get.

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I still count 8 months, not 10, but uh… as excused. So where are we now, then, in the whole process? They're still designing? They're doing final design, they're working on their procurement, they've already, you know, solicited for.

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Offers for the pieces that they need. Um, a lot of the long list lead items.

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The transformers were procured months or years ago, so that's out of the way.

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Um, a lot of the interconnecting. Transmission line was already constructed as part of their previous phase that the San Juan Solar to…

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That they did with PNM. So that's in place. They just need to go and…

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Do their final arrangements on where they're going to build things out, their grading plans, that sort of stuff.

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So, as you see on the dates here, or you can't see unless you turn around.

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Um, March 1st, 2026 is what they're considering their new Phase 1 50% PV capacity date.

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And Phase 2 is what they're calling for March 15th, 2027.

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Or, sorry, did I say March 1st? March 1st, 2026 was when it was planned to be.

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And they moved that to January 1st, 2027. Followed on two months later by full capacity of the plant.

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As I say here, I got some description that already spoke to it about the excused delay, and there still are some.

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Potential tariff and tax credit risks. I can't quantify those. Who knows what'll happen? And they'll just have to deal with those as they come along.

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Risk exposures to the county. This is what we care about.

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Um. We have an excess of PV, 170 megawatts. The county cannot use 170 megawatts, even.

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When you include the… capacity that will be sunk to the storage, to the battery energy storage, just in more BASS.

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We come pretty darn close in the winter, because the… days or shorter, less PB generation. The battery capacity is the same in the winter.

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So you can sync more of your actual. Percentage of your daytime power to the battery. So we come pretty close in the winter.

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Um, there's still some access during the day. Now, in the summer, when the days get longer, and the.

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And more intense, and your battery fills up, you have excess PV.

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And we don't plan on having excess PV, you know, charging the battery all up front, and then having a big.

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Hunk of BV left over at the end of the day. We plan on making it a little smoother, or whatever the market dynamics, you know, optimize for us.

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However, we still are facing a need to sell some daytime power.

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Um, throughout the year, and mostly during the summer, and. Spring and fall.

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The issue is, um… Potentially, we could have a loss if we.

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The worst case we could do is if we can't sell the power.

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Absolute worst case, in which case we're curtailing the power, which means we tell them.

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Just stop. Don't… don't put any power on the grid for us. We can't take it.

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Um, maximum worst-case impact of that is… in the ballpark of $70 a megawatt hour that we pay to not get power.

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So, just want to be clear there. That's why I put $70 a megawatt hour loss.

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For power that we can't use. That's… not something we want to do. So we're looking at all the different approaches we have to avoid that scenario.

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Uh, that's… but that's still a risk that we're working to… to, uh, mitigate or eliminate.

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Edam pricing uncertainty. So, P&M has elected to join the EDAM, which is the Extended Day Ahead Market.

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It's part of the California ISO, or CAISOs. Market arrangements. We already participate in CAISO's.

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Eim, which is the Energy Imbalance Market, which works on an hourly interval.

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And this EDAM takes it to a. Daily basis. Um, so day out in advance, you go and say, here's my generation, here's my loads.

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They match. I'm balanced. And then you go into the… into the next state.

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That's gonna happen sometime in, uh, late… I think it's October 2027 is when P&M is planning to.

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To turn that on, functionality. We, as a… Transmission customer under P&M's.

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Balancing area. Don't get a choice about entering this. We go along for the ride with PNM.

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We will be a participant. Exactly what role and function we'll have in that is still to be.

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Determined, and we're working with PNM to understand what our role will be, and what services and support we'll need to either do internally.

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Contract out, or that P&M can support as a service. Do we have a, um, an obligation or responsibility to…

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To, uh, send excess power. To, let's say, Kirtland, you know?

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Uh, as part of our arrangement, overall arrangement. How does that affect… in other words, how does entering that market affect, sort of, our current arrangements, I guess, is the question?

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Chair, Board Member Knockley, the… We have an obligation under our scheduling services agreement with.

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Sandia National Laboratory, Kirtland Air Force Base. To schedule their power and their energy resources.

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They have… they independently go through the Western Area Power Administration, otherwise known as WAPA.

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Contract for the bulk of their. Their energy needs.

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We make up the difference of what they need, or if they have excess. So they have, uh, recently engaged in their latest agreement with.

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Through WAPA for the coming calendar, next, I believe it's the next three coming calendar years.

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Um, and we still are engaged with them to do their scheduling services. So when they're short, we can provide them extra power through whatever most economical sources… resources are available.

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Which may well include foxtail Flats.

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Sorry, can you remind us, too, um, are there needs typically, unlike residential, meaning they operate more in the day.

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And could utilize… daytime power.

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More. Is that… Board Member Holnsworth, that's absolutely correct. Their load is typically a daytime industrial-type commercial load, primarily during the five weekdays.

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You'll see it drop during the holidays, and you'll see it drop on the weekends, and you'll see it drop at night.

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So they typically are buying, and they have in the past, bought shaped blocks of power. So, seasonally adjusted, as well as hours of day and weekends.

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Thank you. Ben, when we were looking at Foxtail Flats.

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18 months ago, whenever that was. Uh, you were… Suggesting at that point that about 30 megawatts would go to Sandia and Kirtland.

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Is that still the likely scenario? Sure, Gibson, board members, yes, that is…

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Written into our… Currently draft, 2026 ECA.

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Our electric coordination agreement between. The county and DOE and NSA.

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Um, and that language is in there and in place for them to take a pro-rata share, notionally. 30 megawatts of the PV capacity, and 25.

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Percent of the battery energy storage system as well. Thank you.

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Moving on with risks, Southwest Power Pool. So, I mentioned… I mentioned EDAM, the Extended Day Ahead Market. That's a California ISO thing that's being.

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Uh, joined by PNM, and we're going along with that. There's another regional organization called the Southwest Power Pool.

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Sometimes abbreviated as SPP. Uh, they handle a different geographical area.

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Um, up in Colorado towards Wyoming, where our. Coal-fired Laramie River Station, LRS facility is located.

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And they have elected to join a different regional organization. Called the, uh… so they're forming, uh, what's part of… our power plant up there, LRS, is going to be part of the.

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Spp, RTO, Western Expansion. So they are expanding to include that in their regional transmission organization, which means that, similar to what's happening with.

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Edam, um, they're going to have another system where our power will be scheduled into their regional market the same way, similar to the way we'll be scheduling power into the.

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Extended day, I haven't market through P&M. So we're gonna have to deal with power from two different balancing areas and two different regional transmission organizations.

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So there's a little bit of a… technical risk there, and financial risk about how we're going to handle that. We're working through that right now.

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I'll go into more detail in that when we get to the following slides.

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But that is something that we're working on, and a risk that we're tracking and working to mitigate and eliminate.

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Lap load forecast uncertainty. Lapp stands for the Los Alamos Power Pool. It is the joint.

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Uh, load, electrical load, between the county and the DOE and NSA.

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Los Alamos National Laboratory. That's what that term refers to. There is some uncertainty in that load forecast in the coming near years.

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Primarily arising from the linear accelerator. Lance, um, I couldn't tell you offhand what that stands for.

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I think it's Los Alamos… Neutron Scattering Center. Board Member Knockley is familiar with it more than I have.

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Um, but that… that facility is facing. First of all, they are, I believe they are… they haven't run at full capacity.

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For the past year. Um, full power capacity is typically about 20 megawatts.

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Plus or minus. Um, they've been running it. Maybe 8 to 12, typically.

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Um, so significantly less than we would normally plan on. And given their plan for.

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The, uh, LAMP project. The linear accelerator modernization program.

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I believe that is likely to be the case for the… at least the next coming 4 or 5 years.

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Given the schedule that I've seen for that project. That we're not going to see much load from that.

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So we're trying to factor that into our load forecasts so that we don't… have excess power that we're exposed to market risks on selling that.

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Another uncertainty is LANL computing facilities. Um, that was scheduled to come on in 2027 with a… With a new load, however, and I do believe that may still be at roughly that schedule.

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But my indications are that it may be at a lower power load requirement than was originally forecast.

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So we're looking at that to make sure we get that built in there.

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And then the final piece of the puzzle is, uh, lacon-lion oil electrification.

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Now, I know that electrification goals have maybe been evolving for various reasons.

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Um, so there's some uncertainty there. Um, it seems to be, maybe, at least electrification of vehicles, maybe slowing below what, uh.

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Was projected as little as a year or two ago. We'll try and do our best. We have an electrification study that we recently did for the electric distribution department, and that will be served to help inform.

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Load forecasting for that particular aspect. For the county side, at least. And then I'm gonna rely on Lanl.

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And DOE staff for what they think is going to happen on the… on the DOE side of the power pool.

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Tariffs and tax credits, I already mentioned that once, nothing more to say about there.

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Other than it… who knows what'll happen. Uncertain hydro water flows and pool elevations, we have talked about that at the last, um, meeting I presented to you.

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Uh, or when, uh, Don Wickers was here presenting the status for the Hydro's annual… on his annual update.

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Um, still don't know what the forecasts are going to be.

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Um, as soon as we know, and we… Still don't know what the repair plan is going to be for Elvado, but we're anticipating maybe another couple years before they figure out what they're gonna do there.

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So hopefully the pool elevations will stay where they're at now.

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And uncertain future market loads and prices. And I mention this because.

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Um, we're seeing a lot of volatility in prices. Favorable in some ways, uh, when we last signed for our Mercuria.

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40 megawatt around the clock. Firm power agreement.

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Two years ago, when we… simultaneously, when we did the Foxtail Flats agreement.

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Power was trading in the high $70 range. It has since fallen anywhere for firm around-the-clock power. Again, not.

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Not renewable power. We're likely going to get coal or gas, natural gas units.

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Into the ballpark of $65 to $55 a megawatt hour. So, dramatic change over the past couple years.

00:23:55.000 --> 00:24:04.000
Um, could that change again? Yeah, probably. Possibly. You hear all this stuff about it in the news about, uh, data center loads jumping up.

00:24:04.000 --> 00:24:10.000
Around the country. Haven't seen that in New Mexico yet, but Meta is planning on putting a facility in New Mexico.

00:24:10.000 --> 00:24:18.000
So that could increase. Um, doesn't necessarily affect us, maybe. But only when we buy power.

00:24:18.000 --> 00:24:24.000
So we'll… and there's a big disconnect right now between the cost of new generation resources.

00:24:24.000 --> 00:24:29.000
And buying market power, like I said. $55 to $65 to buy power today.

00:24:29.000 --> 00:24:36.000
You want to go buy a new resource? It's going to cost you $100 to $150 a megawatt hour.

00:24:36.000 --> 00:24:43.000
So, big, big separation there. Been since you brought up Mercuria, this is a good time to… I was going to raise this question anyway.

00:24:43.000 --> 00:24:50.000
Our current contract with Mercuria. Yeah, it goes until the 1st of March.

00:24:50.000 --> 00:24:58.000
2026, based on the original. Uh, first operation date of Foxtail Flats.

00:24:58.000 --> 00:25:06.000
Obviously, they are 8 months, 10 months, who knows? Behind schedule? Are we exploring.

00:25:06.000 --> 00:25:13.000
Extending a deal with Mercuria on… on whatever the appropriate terms would be.

00:25:13.000 --> 00:25:19.000
Or, uh, how are we planning to cover that gap, since we know it's gonna be there?

00:25:19.000 --> 00:25:25.000
Sure, there's some good questions. Yes, we are planning for that. I have reached out to multiple different, uh, energy suppliers to get.

00:25:25.000 --> 00:25:31.000
Indicative pricing at this point, that's where the $65 to $55 megawatt hour range comes from.

00:25:31.000 --> 00:25:38.000
Specifically for that purpose. Starting in March 1st through, say, September-ish, October-ish kind of time frame.

00:25:38.000 --> 00:25:43.000
When we expect to get first test energy deliveries from Foxtail Flats.

00:25:43.000 --> 00:25:49.000
Um, that said. I can't actually act on any of those offers at this time.

00:25:49.000 --> 00:25:55.000
Because we don't have a… ECA that covers that term.

00:25:55.000 --> 00:26:04.000
So… but I do have those numbers in hand, so we can at least compare them as soon as we can roll on it and see what the price is at the time.

00:26:04.000 --> 00:26:08.000
But this'll be a… let's consider a little marker of where we were at today.

00:26:08.000 --> 00:26:16.000
Thank you. So, I mentioned earlier, the cost risk is bounded by the curtailment option, where we.

00:26:16.000 --> 00:26:23.000
Shut down production, don't take any power from the PV. And that comes out to the way this agreement is structured is the cost of energy.

00:26:23.000 --> 00:26:29.000
About $38, plus the potential. Foregone tax… production tax credits.

00:26:29.000 --> 00:26:40.000
Which is roughly $30, I believe. Um… adding up to $68, which I rounded to $70 on the previous slide.

00:26:40.000 --> 00:26:46.000
Generation load modeling, as I mentioned earlier, we work with that annually with DOE.

00:26:46.000 --> 00:26:57.000
Flannel to make sure that we. Come as close as we can. We haven't done a great job in years prior, um, primarily, again, due to Lance and loads that didn't appear on when they were expected.

00:26:57.000 --> 00:27:01.000
Um, we're gonna work on that getting a little closer this year to reality, hopefully.

00:27:01.000 --> 00:27:09.000
Um, and starting sooner. Uses it… uses a calendar year 22 to 24 loads and plan generation, so.

00:27:09.000 --> 00:27:17.000
My, uh… staffer here, Nick Nelson, who is actually the, uh, power systems.

00:27:17.000 --> 00:27:23.000
Supervisor, so your supervisors are real-time operators. Who sit at the desk 24-7.

00:27:23.000 --> 00:27:28.000
He has been, uh, very helpful in helping model out our actual loads.

00:27:28.000 --> 00:27:36.000
And piecing together how our future generation. Fit together with that in order to balance out.

00:27:36.000 --> 00:27:41.000
And identify when and where we need to either buy or sell power.

00:27:41.000 --> 00:27:47.000
To make us balanced. Um, I said here, $70 megawatt hour to buy.

00:27:47.000 --> 00:27:56.000
Market energy, that's what we put in our model, just for the cost estimate. Um, the $65 was… The estimate I had a month ago.

00:27:56.000 --> 00:28:00.000
Um, and by the time I got to, uh, submitting these slides, I got.

00:28:00.000 --> 00:28:09.000
Additional information at $55, so… take that for a grain of salt. It changed a bit over the past week, after I submitted the presentation.

00:28:09.000 --> 00:28:12.000
So here we go. Here's the meat and potatoes of this subject.

00:28:12.000 --> 00:28:20.000
What are we gonna do with the XSPV? Um, this is a roughly… prefer… ordered by preference of what we want to do.

00:28:20.000 --> 00:28:27.000
Um, what we think we can do and the options we have. First one is to… sell Laramie River Station.

00:28:27.000 --> 00:28:31.000
10 megawatts during the day. When we all have plenty of PV.

00:28:31.000 --> 00:28:39.000
And use PD in place of it. Um, we believe that'll be a perfectly viable option, especially with the entrance of.

00:28:39.000 --> 00:28:44.000
Both the, uh, LRS going into SPP, the Southwest Power Pool.

00:28:44.000 --> 00:28:49.000
Regional transmission organization. It presents an opportunity to simply sell the power.

00:28:49.000 --> 00:28:53.000
At the generating site. And then, during the day.

00:28:53.000 --> 00:28:59.000
We can bid it in for the daylight hours when we don't need it, and keep it at night.

00:28:59.000 --> 00:29:05.000
That's certainly a possible option. Um, the exact mechanics of… and cost impacts of how that works.

00:29:05.000 --> 00:29:16.000
Aren't yet characterized, because. Um, they rely on future forecasts of power, which are not known, and it's kind of a complex interaction between buying and selling power and.

00:29:16.000 --> 00:29:21.000
Nodal, what's called vocational. Uh, marginal prices.

00:29:21.000 --> 00:29:24.000
I haven't talked about that in the past, and I don't want to get into it now.

00:29:24.000 --> 00:29:28.000
But we'll get into more detail when we actually have some numbers to show you.

00:29:28.000 --> 00:29:33.000
Down the road. That's first option. Second option is to sell some or all.

00:29:33.000 --> 00:29:41.000
Of the excess PV that we anticipate through some fairly short-term, say, 1-5 year agreement.

00:29:41.000 --> 00:29:52.000
That's what we had planned to do with Mercuria, and that just didn't work out at the time. Um, but those opportunities may still present themselves. In fact, I'm talking right now with a potential off-taker.

00:29:52.000 --> 00:29:57.000
Who's, uh, maybe has some interest in it. So, I do believe there may be some potential for this.

00:29:57.000 --> 00:30:06.000
Um, it'd be a great option for us to sell some power that we don't need, and take the risk away from us, at least for that short term, until our loads increase to where we can use it all.

00:30:06.000 --> 00:30:11.000
Third option is, and Chair Gibson alluded to this in his question, I spoke a little bit to it.

00:30:11.000 --> 00:30:15.000
Third option is to sell more PV to Sandia National Lab, and Air Force Base.

00:30:15.000 --> 00:30:20.000
Uh, based during the day. We are not… they're not on contract to take power from us.

00:30:20.000 --> 00:30:32.000
But if their load grows, they have some plans for, um… a… I believe it's a solar… thermal plant of some kind, uh, for power storage called Asgard.

00:30:32.000 --> 00:30:39.000
Maybe that'll happen, maybe it won't. If it doesn't happen, that presents an opportunity for us to supply the load that that could potentially serve.

00:30:39.000 --> 00:30:48.000
Um, as well as additional purchases, um, during the day and night, if as needed beyond the 30 megawatts that they're signed up for.

00:30:48.000 --> 00:30:55.000
Fourth option is to modify the lentil gas turbine. By modifying it, I mean just the controls so that we can actually have.

00:30:55.000 --> 00:31:06.000
Automatic generator controls onto it that tie into the California. Iso EDAM system that can turn it on automatically without us having to manually.

00:31:06.000 --> 00:31:10.000
Dispatch it. Um, that presents, like I said, PNMs entering EDAM.

00:31:10.000 --> 00:31:16.000
That, again, presents another opportunity for us to. Bid in that generation.

00:31:16.000 --> 00:31:20.000
Basically say, hey, we have this generator, we can run it.

00:31:20.000 --> 00:31:25.000
At this price. And if it gets called upon, then we run it and we sell that power.

00:31:25.000 --> 00:31:37.000
Potentially at a profit. Um, and reduce… and what it does is, normally we run the CGTG to offset behind the meter, the load from Lance.

00:31:37.000 --> 00:31:44.000
That's a conceptual plan that we use for operating it. In this case, we would say, okay, we're going to decouple those two things.

00:31:44.000 --> 00:31:49.000
We'll run it when the market calls for it, and we won't otherwise.

00:31:49.000 --> 00:31:53.000
Therefore, it'll sit idle, and we'll be able to, instead of… if Lance is running at full power.

00:31:53.000 --> 00:31:57.000
We'll be able to send all of our PV to operate it during the day.

00:31:57.000 --> 00:32:04.000
So it's another opportunity for us to sell excess daytime power by avoiding running the CGTG.

00:32:04.000 --> 00:32:12.000
Fifth option is to sell excess PV. Straight into the market through EDAM or another third party.

00:32:12.000 --> 00:32:19.000
There are good… that's definitely an option. Um… like I said, no idea what the cost of that would be at this point.

00:32:19.000 --> 00:32:28.000
Sixth option, sell, uh, get more battery. If we use more… get more battery, we have a mo… we did modeling on this. If we get more battery, we can use more PV during the day.

00:32:28.000 --> 00:32:32.000
Which helps us out in the summer, lowers the excess that we need to sell.

00:32:32.000 --> 00:32:37.000
And in the winter, it allows us actually to use the battery to run through the whole night. Pretty much.

00:32:37.000 --> 00:32:44.000
Match our load in the middle of winter. Um, it's certainly an option, uh…

00:32:44.000 --> 00:32:49.000
Problem there is… is cost. And I'll get into that in the coming slide.

00:32:49.000 --> 00:32:59.000
The last least desirable option is to curtail the PV. For the reasons that I mentioned, the $70 hit on every megawatt hour, we don't take.

00:32:59.000 --> 00:33:08.000
Any questions, feel free to… speak up. So, I'm gonna go into more detail, these are the options right now. Selling LRS daytime.

00:33:08.000 --> 00:33:21.000
I largely actually talked to this on the previous slide, I guess I jumped ahead here. Um… But as I mentioned, LRS joining SPPRTO starting April 2026, um, so that'll be in advance of when.

00:33:21.000 --> 00:33:25.000
Foxil Flats actually comes online, so it'll be available from the get-go.

00:33:25.000 --> 00:33:32.000
It does allow a straightforward sale of LRS power on an hourly basis. So, like I said, we'd sell it during the day, keep it at night.

00:33:32.000 --> 00:33:37.000
And drop down, uh, or actually allow us to sync an extra 10 megawatts of.

00:33:37.000 --> 00:33:43.000
Power from Foxtail Flats during the day. Ben, have you?

00:33:43.000 --> 00:33:54.000
Done any modeling. One form or another, to look at the reliability of that option, because you're talking about shifting more and more of our.

00:33:54.000 --> 00:34:01.000
Resource needs to… Foxtail Flats, which is a brand new resource.

00:34:01.000 --> 00:34:07.000
One that we are not familiar with yet. We don't have operating experience with it.

00:34:07.000 --> 00:34:16.000
Uh, the, uh… Um, if we shift more and more of our load, projected load there.

00:34:16.000 --> 00:34:23.000
And give up our, um… Traditional supplies, shall we say.

00:34:23.000 --> 00:34:32.000
Are we putting ourselves at a reliability risk? Chair Gibson, Board Members, potentially, and…

00:34:32.000 --> 00:34:39.000
Maybe not. Um, the… our entrance into the… these new markets, we entered into the extended.

00:34:39.000 --> 00:34:47.000
Or not extended, the EIM. Um, and then we're going to be entering into EDAM. Those both provide new opportunities on an hourly basis.

00:34:47.000 --> 00:34:58.000
To schedule power. Um, and deal with those… unexpected or intermittent behaviors that you're referring to, which could affect reliability.

00:34:58.000 --> 00:35:04.000
Um, with the EDAM market, you bid in previous… every hour, uh, one day ahead.

00:35:04.000 --> 00:35:10.000
And you say, okay, this is how I'm gonna generate all the power I need to match my load.

00:35:10.000 --> 00:35:16.000
If that doesn't happen, because your PV comes offline, now you're relying on the.

00:35:16.000 --> 00:35:26.000
Eim, the energy imbalance Market, to make up those shortfalls. Or you go and do… same way we do today, we use the real-time market to go make purchases as available.

00:35:26.000 --> 00:35:30.000
Now, the intent behind these new market arrangements is are they.

00:35:30.000 --> 00:35:35.000
Increase the optimization and liquidity of. Power and transmission.

00:35:35.000 --> 00:35:47.000
To connect these different areas. So the expectation is that that will take some of that risk away. How much? I don't have a quantity to throw at it, but that's the general feel, is that.

00:35:47.000 --> 00:35:58.000
It gives us that opportunity. Now, if we know that there's a… we forecast, we're going to have to forecast weather and things like that for Foxtail Flats and forecast the output of the panels. If we know there's a weather event, snow coming up.

00:35:58.000 --> 00:36:09.000
We'll say, okay, we can probably anticipate this. And there are, you know, emerging or existing tools, software tools, which allow you to, you know, hopefully reliably model that sort of thing.

00:36:09.000 --> 00:36:13.000
Um, and there… I do believe they're getting better as time goes by.

00:36:13.000 --> 00:36:22.000
So, given that, if you knew… if you had a reasonable expectation that your panels were going to get a foot of snow and not being producing for, you know, this period of time.

00:36:22.000 --> 00:36:29.000
You can actually build that into your. Day ahead planning, and go find some additional resources.

00:36:29.000 --> 00:36:34.000
Wherever they're available. That's the… that's what you'd have to do. Um…

00:36:34.000 --> 00:36:39.000
And you would call back, oh, I need my LRS back. I'm not selling it for that day.

00:36:39.000 --> 00:36:48.000
During the day. I need it. So we go find additional resources, or EDAM goes and finds additional resources.

00:36:48.000 --> 00:37:02.000
Edam requires us to have enough generation from whatever source. It could be, you know, own generation, it could be bilateral trade, market purchases, it could be real-time. We could even say, okay, we're just gonna go buy it on the real-time market on an hourly basis.

00:37:02.000 --> 00:37:07.000
During that day. You can do that, but you need to have all the generations lined up.

00:37:07.000 --> 00:37:19.000
For which you anticipate your load will be. So the uncertainty comes in when things don't happen. Now, if we know there's going to be a snowstorm, we anticipate we're going to have less power out of that, we're not going to sell as much excess PV for that period of time.

00:37:19.000 --> 00:37:27.000
We're going to say, okay, we're gonna keep LRS, and that'll, you know, deal with the 10 megawatts, at least 10 megawatts of daytime solar that we're not going to get.

00:37:27.000 --> 00:37:32.000
Because there's snow on the panels. It's things like that that we'll have to do.

00:37:32.000 --> 00:37:36.000
Okay, just to clarify, I think you've answered it, but I want to be sure.

00:37:36.000 --> 00:37:41.000
If we… Um, go in the direction of option one.

00:37:41.000 --> 00:37:48.000
We still have the… although we would be planning to sell the daytime power out of LRS.

00:37:48.000 --> 00:38:01.000
But if something changes, we don't have to. We could keep it. Is that correct? It could be structured that way. Generally, it would be more like a pro-rata share. If the plant goes offline, or the capacity goes down because of a weather event or whatever.

00:38:01.000 --> 00:38:11.000
Or, you know, there's a failure. Part of the, you know, you have a… an inverter bank, you know, fails, and you lose one of your… one of your fields.

00:38:11.000 --> 00:38:24.000
They would take their pro-rata share of that outage. As well as us. So we wouldn't be… it's not… we would never set… offer a firm product, where we say, we're guaranteeing to give you 50 megawatts during these hours. We can't offer that.

00:38:24.000 --> 00:38:30.000
This is going to be a unit contingent sale. Where you get what you get.

00:38:30.000 --> 00:38:35.000
But I'm asking about… LRS sale, if we…

00:38:35.000 --> 00:38:42.000
I said, most of the time, sell the daytime power. But then the snowstorm comes along and says, oh boy, we, uh…

00:38:42.000 --> 00:38:46.000
We ought to hold on to that. Can we hold on to that? Yes.

00:38:46.000 --> 00:38:59.000
Okay. It's done every day as its own thing. You can choose to do whatever you want with it. There's a lot of flexibility built in it. Nobody is obligated to bid their generation into those markets.

00:38:59.000 --> 00:39:10.000
You can keep it for yourself as a self-supply. It's… it's a little complicated on how the actual terminology works. You're still bidding in the resource, but then you pull it out at your delivery node.

00:39:10.000 --> 00:39:21.000
The equivalent amount. Thank you. Thank you, Ben. Um, so, worst case scenario, let's say that Foxtail Flats comes online, and.

00:39:21.000 --> 00:39:25.000
We're buying our power from Foxtail Flats and selling the X's, and everything's great.

00:39:25.000 --> 00:39:30.000
Then a hailstorm comes along, and the entire Foxtail Flats is down.

00:39:30.000 --> 00:39:35.000
What do we do then? We have, uh, how do we buy our power? Is that spot market?

00:39:35.000 --> 00:39:50.000
What do we do? We… initially, when first… the first things happened, the… Extended day ahead market, and the… energy imbalanced market will cover those shortages, hopefully, unless there's some crazy event where power's not available.

00:39:50.000 --> 00:39:56.000
In which case, you're scrambling to do whatever you can. Um, longer term, you know, short… you'd go for a short-term sale.

00:39:56.000 --> 00:40:07.000
Um, whatever period you anticipate needing, month, 3 months, whatever. Um, you… The same way we did with Mercury and bought the 40 megawatt around-the-clock deal, we'd go and look for one of those.

00:40:07.000 --> 00:40:13.000
Whatever the price is at the… the best price we can get at that time.

00:40:13.000 --> 00:40:17.000
I wanted to add something to that, uh… Sure. When Ben and I visited the.

00:40:17.000 --> 00:40:24.000
First phase project out there that P&M's enjoying. They have 13 weather stations on site.

00:40:24.000 --> 00:40:30.000
To protect their solar panels from hail, they actually monitor for that.

00:40:30.000 --> 00:40:34.000
Um, and then they have a way to turn the panels straight up and down to.

00:40:34.000 --> 00:40:41.000
Avoid damage. Um, there is a big insurance claims on. Several sites where they have fixed panels.

00:40:41.000 --> 00:40:52.000
Um, and, you know, just trying to recover the cost from that is… they're just not able to, you know, so that's why they put in the protection.

00:40:52.000 --> 00:41:04.000
And I will point out. That… we don't lose… back in the day, you know, we had the biggest single resource was San Juan Generating Station.

00:41:04.000 --> 00:41:09.000
36 megawatts. When that tripped offline, our share of that?

00:41:09.000 --> 00:41:17.000
We had to go buy a power. So this is, you know, a new scaling with a new, more intermittent resource, admittedly.

00:41:17.000 --> 00:41:27.000
Um, put the basic concepts of dealing with these. These unanticipated outages is something that our operators deal with.

00:41:27.000 --> 00:41:31.000
Fairly regularly, and have in the past, and will in the future.

00:41:31.000 --> 00:41:38.000
Just the scaling's a little different.

00:41:38.000 --> 00:41:44.000
Let's see… term sale… I mentioned this, say, anywhere from 10 to 50 megawatts for 1 to 5 years.

00:41:44.000 --> 00:41:52.000
These are just notional. Depends on what somebody wants. Um, the goal would be to sell for not less than a break-even price.

00:41:52.000 --> 00:41:56.000
Preferably a little bit more to make it our… cover our admin overhead.

00:41:56.000 --> 00:42:06.000
Um, like I say, though, market price is $55, or… margins are pretty tight there. Um, this will lower or eliminate the risk near term.

00:42:06.000 --> 00:42:11.000
Of future market price variability for us. For selling that excess power.

00:42:11.000 --> 00:42:16.000
So that's why it's one of our preferred options, the one that we're actively pursuing.

00:42:16.000 --> 00:42:28.000
Third option, more Sandy or Kirtland. Sales, as I mentioned, 30 watt megawatt share, um, and a potential for an increasing amount of that as they go along. Their loads increase.

00:42:28.000 --> 00:42:34.000
Or they don't get some of their behind-the-meter generation that they're planning on.

00:42:34.000 --> 00:42:43.000
And I should say, I can't speak for them, but if, you know, Foxtail Flats turns out to be a good price, um, for the next.

00:42:43.000 --> 00:42:49.000
2 or 3 years, and when they're renegotiating their… are planning on their next buyer purchase agreement.

00:42:49.000 --> 00:42:53.000
We could factor this in, as well as any other resources we have down the road there.

00:42:53.000 --> 00:42:58.000
So, possible opportunity there. Uh, optimize the CGTG.

00:42:58.000 --> 00:43:07.000
I went into detail on this one already, so I don't want to… rehash this, unless somebody has more questions on it.

00:43:07.000 --> 00:43:15.000
Yeah, Ben… How much has the CGTG been running.

00:43:15.000 --> 00:43:22.000
And to offset the lance load in the recent past. Has it been used in that way?

00:43:22.000 --> 00:43:31.000
It hasn't. It's really only been run, um… to, uh, test its availability and make sure that it's operational.

00:43:31.000 --> 00:43:42.000
Um, there was one event, I think, where LRS tripped offline, and uh… And there was some regional with PNM, and they actually requested one of their, uh…

00:43:42.000 --> 00:43:46.000
Yeah, one of their static bar compensators, our static bar compensator was off.

00:43:46.000 --> 00:43:52.000
And they had a capacitor bank or some other ancillary service equipment that was offline as well.

00:43:52.000 --> 00:43:58.000
And they were experiencing some instability in the grid, and they asked us to run the CGTG.

00:43:58.000 --> 00:44:06.000
To, uh, for… provide some voltage support, frequency support, and so we did that. Um, that was only for, like, a few hours, though, I believe.

00:44:06.000 --> 00:44:10.000
Sam, it was a couple days. But other than that, we've only… they've only run it.

00:44:10.000 --> 00:44:13.000
For limited periods, just to make sure it's operational when we need it.

00:44:13.000 --> 00:44:18.000
Okay, that's what I thought. That's a very expensive resource, is it not?

00:44:18.000 --> 00:44:25.000
Uh, the last time I heard a number was on the ballpark of $60 to $65 a megawatt hour all in.

00:44:25.000 --> 00:44:36.000
Including fuel. Which is not that bad by today's standards. I was thinking it was higher. Okay, thank you. It was higher when we had, uh, um… San Juan at, you know.

00:44:36.000 --> 00:44:45.000
30 bucks or something. So, prepare… and, you know, we had good hydro generation at $25, and LRS at $27, you know, you add those up together, we're in the.

00:44:45.000 --> 00:44:54.000
40s or $50 range, so yeah, that's CGT was expensive by comparison. Thank you.

00:44:54.000 --> 00:45:00.000
Sell PV on EDAM. I already went into detail with this. Um, we are planning for the EDAM.

00:45:00.000 --> 00:45:03.000
Because we don't have a choice, it's coming along, we need to be ready for it.

00:45:03.000 --> 00:45:12.000
Um, in fact, I may come to you down the road here, saying, uh, we need to do a, uh, financial, uh, gap analysis on this, so we can get some good numbers.

00:45:12.000 --> 00:45:17.000
That may happen. Well, maybe I'll bring it up right now.

00:45:17.000 --> 00:45:27.000
We've been hearing about EDAM for some while. We've anticipated that it's coming, and now you're telling us, yeah, it's coming for sure.

00:45:27.000 --> 00:45:33.000
And you've even got a date at this point. And it's obviously a big thing in how we…

00:45:33.000 --> 00:45:40.000
Uh, and what the… Electric market is going to be, and how the system is going to work in future years.

00:45:40.000 --> 00:45:47.000
We as a board don't have a whole lot of… information about how EDAM really works.

00:45:47.000 --> 00:45:53.000
Um, I… I would think it would be helpful to the board.

00:45:53.000 --> 00:45:56.000
If we could get a tutorial or briefing at some point.

00:45:56.000 --> 00:46:05.000
And a discussion… allow some discussion. To help us understand EDAM before we have to make too many decisions.

00:46:05.000 --> 00:46:15.000
That involve it, and I assume this Southwest market that you're talking about probably works somewhat, in a somewhat similar way.

00:46:15.000 --> 00:46:20.000
Uh, so I think we're not very well equipped at this point.

00:46:20.000 --> 00:46:30.000
To, um, evaluate and think about EDAM-type things very well. And I think that could be helped.

00:46:30.000 --> 00:46:35.000
I'm getting some head nods. Yeah, no, that would be nice, that would be good.

00:46:35.000 --> 00:46:49.000
How many states are participating in this KISO EDAM market? Probably a large number, I would think, in the western states. I don't have a number handy. Philo, do you get anything out of the UAMPS meeting? I was at the APPA conference in June, and…

00:46:49.000 --> 00:46:56.000
It's pretty much all across the country. Oh, really? Yeah, yeah. It's a natural, basically.

00:46:56.000 --> 00:47:09.000
Well, within the western region, south… western South Virginia, we're the western area grid, but they… you know, it crosses into the eastern area grid as well, so…

00:47:09.000 --> 00:47:17.000
There are some notable… parties that are electing to choose the other option with SBB, so…

00:47:17.000 --> 00:47:23.000
Competing approach, which is called Markets Plus. El Paso Electric, for example, and I.

00:47:23.000 --> 00:47:28.000
I believe SRP. Srp is joining them, as well as, like I said, it, uh.

00:47:28.000 --> 00:47:36.000
In Colorado and in Wyoming, so… Yeah. So, it's kind of…

00:47:36.000 --> 00:47:55.000
A smorgasbord mix, mixed, checkerboard of who's what right now. Can I prom… I can't promise anything about whether that'll consolidate. I don't know if this will be a beta versus, you know, uh, Betamax versus VHS, I don't know. You're not gonna fix our electric situation in this country? Come on.

00:47:55.000 --> 00:47:59.000
But yeah, um, as far as getting a better understanding at EDAM, yeah, I will, uh.

00:47:59.000 --> 00:48:08.000
We'll work to schedule up something that we can give you some more information about that, so you can be informed on it as we move forward.

00:48:08.000 --> 00:48:12.000
Philo can handle that and schedule a meeting, tell me when it is.

00:48:12.000 --> 00:48:18.000
We'll put it on the agenda. Sub-agenda.

00:48:18.000 --> 00:48:24.000
Oh, pretty soon, I think. It can't be too soon, though. However, we can give you a general.

00:48:24.000 --> 00:48:34.000
Understanding of how EDAM works, but as far as, you know, understanding how it impacts the county specifically, that'll take a little more time while PNM is still figuring out how they're going to do it.

00:48:34.000 --> 00:48:38.000
And how… what their expectations for the interface between us and them will be.

00:48:38.000 --> 00:48:45.000
They're still working on that. Yeah, the first step is understanding how EDAMs work in general.

00:48:45.000 --> 00:48:53.000
Option 6, get more battery. Um, here's some numbers. We ran a bunch of different, uh, size calculations and said, what can we do if we ran, you know, an extra…

00:48:53.000 --> 00:49:01.000
10, 20, 40, 100 megawatts of, uh. And a 4-hour battery, so multiply that by 4 to get the energy capacity.

00:49:01.000 --> 00:49:07.000
Of energy storage. What does it look like? Um, for our load and generation profiles.

00:49:07.000 --> 00:49:12.000
Uh, turns out that 20 megawatts, uh, 80 megawatt hours is.

00:49:12.000 --> 00:49:27.000
Probably optimal for what we know now. Um, throwing in a number at $12.50 a kilowatt month, battery prices have fallen, uh, since we contracted. I don't know exactly how much. I tried to get some numbers, but the best, I guess, had come up with.

00:49:27.000 --> 00:49:32.000
12 and a half. Um, looking at that. And I picked 12 and a half roughly, because.

00:49:32.000 --> 00:49:36.000
It's a good number, and if you add 20 megawatts at 12 and a half.

00:49:36.000 --> 00:49:41.000
Dollars per kilowatt month, it comes out to a nice, even $3 million a year. Easy number to work with.

00:49:41.000 --> 00:49:47.000
So that's why I picked that. It does lower the cost risk of curtailment, meaning.

00:49:47.000 --> 00:49:50.000
By being able to charge the battery with some of that PV.

00:49:50.000 --> 00:49:58.000
We eliminate the risk of having to curtail that power. Um, but it only does it by one. It saves you about one and a half million dollars.

00:49:58.000 --> 00:50:06.000
Of risk or cost exposure. So that's where I get the last bullet. Benefit-to-cost ratio of 0.5.

00:50:06.000 --> 00:50:11.000
Meaning the cost outweighs the benefit. Generally, anything less than 1 is considered not, uh.

00:50:11.000 --> 00:50:27.000
Something you necessarily want to go for. So, I don't see this as a… food option. So is the… so help me understand the reason for that. I'm making a story up in my head, and it goes like this. Oh, we're gonna produce a lot of energy during the day, so a lot of excess that we have to store.

00:50:27.000 --> 00:50:32.000
But we're just not going to use as much of it at night as would benefit, you know.

00:50:32.000 --> 00:50:41.000
That kind of energy, right? We still have a lot of energy just sitting in the battery. Is that basically the reason why we don't… It's… it's cost.

00:50:41.000 --> 00:50:47.000
The batteries are expensive. It's basically just the cost of that. It comes out to cost. If you look at the cost of a battery.

00:50:47.000 --> 00:50:53.000
Um, I don't have a calculation for $12.50 per kilowatt month, but at the price we're paying, which is 13.5 kilowatt a month.

00:50:53.000 --> 00:50:58.000
It works out to an equivalent cost just to have the battery.

00:50:58.000 --> 00:51:04.000
Of about 111, $112 added. To the cost of the power to charge it.

00:51:04.000 --> 00:51:10.000
Per megawatt hour. Oh, wow. Yeah, okay, so a good go by, if you want a 10 megawatt hour.

00:51:10.000 --> 00:51:17.000
Utility scale battery, it's going to cost you $2 million just for batteries.

00:51:17.000 --> 00:51:24.000
But I think those prices… it's an interesting… price time. Right now, they've dropped by about 70% over the last 3 years.

00:51:24.000 --> 00:51:31.000
I think, right? Batteries are… the price of batteries are… I'm talking about is current prices, so the 320 megawatt hours.

00:51:31.000 --> 00:51:38.000
Would be, um… what, 600 was the 323? $64 million.

00:51:38.000 --> 00:51:43.000
And Chair Gibson is telling me that. The 320 megawatt hours is…

00:51:43.000 --> 00:51:48.000
Usable, but the sweet spot of lithium is between 20% and 80%.

00:51:48.000 --> 00:51:55.000
That you're gonna cycle. And so that tells me that if we… if you have 320 megawatt hours of usable batteries.

00:51:55.000 --> 00:52:06.000
They actually have 533 megawatt hours of actual batteries. And I don't know what the real story is. I don't know if they have 533 to give us 320, or I don't know if they have 320 and they give us.

00:52:06.000 --> 00:52:12.000
Last, I don't know. That's… they are…

00:52:12.000 --> 00:52:18.000
Under the agreement, the energy storage agreement, they are providing the rated… stated capacities in the agreement.

00:52:18.000 --> 00:52:25.000
The 80 megawatts, 320 megawatt hours of capacity. Full discharge, full charge, every day.

00:52:25.000 --> 00:52:33.000
Whatever they do to… get a system that's capable of doing that reliably, and for the duration of that 20-year.

00:52:33.000 --> 00:52:40.000
Term, that's on them to figure out. I haven't asked those questions about that. Yeah, so that's $100 million worth of batteries.

00:52:40.000 --> 00:52:45.000
Is… and that's just the batteries, that's not the structure around it, and that's not the inverters, that's not anything.

00:52:45.000 --> 00:52:50.000
They're giving us… that's costing about $100 million just for the batteries.

00:52:50.000 --> 00:52:59.000
Could be. Okay. Now, Board Member Hevner, you mentioned cost of batteries coming down?

00:52:59.000 --> 00:53:05.000
That is not been reflected in. Market prices for these systems.

00:53:05.000 --> 00:53:08.000
I don't know why. It could be partly due to tariffs.

00:53:08.000 --> 00:53:20.000
For example, I read an article, again, anecdotal. That, you know, we're talking $13 a kilowatt month in Europe, you can get these for $6 or $7 per kilowatt month.

00:53:20.000 --> 00:53:25.000
I don't know the reason. There's some structural reasons why.

00:53:25.000 --> 00:53:30.000
It has to do just with the U.S. Markets, I presume.

00:53:30.000 --> 00:53:35.000
That's all I can tell you. Any other questions on this?

00:53:35.000 --> 00:53:41.000
All right. So here was, like I said, we tried a bunch of different sizes.

00:53:41.000 --> 00:53:49.000
The first, uh, vertical bar here shows where we're at with the current Foxtail Flats Energy Storage System.

00:53:49.000 --> 00:53:58.000
And what we tried to do here is characterize. Based on our models, how much excess power in one year would we have to.

00:53:58.000 --> 00:54:06.000
Curtail if all we did was curtail the access power. And it could potentially cost us about $8 million a year.

00:54:06.000 --> 00:54:11.000
For that… the cost of that curtailed PAR. If we add increasing amounts of.

00:54:11.000 --> 00:54:20.000
Additional storage to use some of that excess PV. You'll see that the cost exposure, the risk that we have of market sales for our.

00:54:20.000 --> 00:54:29.000
Curtailing drops. But again. Not as much. And then it starts rising again, because we reach a point where you alluded to.

00:54:29.000 --> 00:54:36.000
We run out of PV to charge it in winter. So we have a battery now that we can't charge, unless we charge it from the grid.

00:54:36.000 --> 00:54:41.000
Which is in our operational plan. So, that's where we got the 80 megawatt, right? Kind of in the middle.

00:54:41.000 --> 00:54:48.000
As being optimal. For additional storage.

00:54:48.000 --> 00:54:53.000
Questions? Alright, moving on. Option 7, curtailing PV. Like I said.

00:54:53.000 --> 00:54:58.000
$8 million a year for your energy you don't use. Um.

00:54:58.000 --> 00:55:05.000
The, uh, $5 million a year value is the estimated worst case. That's… did I say $5 million?

00:55:05.000 --> 00:55:10.000
I don't know where that came from. Or maybe a typo.

00:55:10.000 --> 00:55:16.000
You know what that was? Yeah. I think that's just selling all of that.

00:55:16.000 --> 00:55:24.000
Yeah. Okay. I don't know what that was anymore. Um, I think that's a typo. That should be the $6 million that we were seeing.

00:55:24.000 --> 00:55:30.000
Or the $1.5 million of risk avoidance that we saw in the previous slides.

00:55:30.000 --> 00:55:35.000
Implementing any of these options? The previous options, you know.

00:55:35.000 --> 00:55:40.000
Keeping, uh, selling LRS during the day, selling more power to, uh, Sandia Curtin.

00:55:40.000 --> 00:55:46.000
Um, making other arrangements for a term sale, all those lower our cost risk of curtailment.

00:55:46.000 --> 00:55:53.000
With… without the downsides. And the poor cost-to-benefit ratio that we see with additional.

00:55:53.000 --> 00:55:59.000
Pv from a battery system, and curtailment, so… That's why this is the worst case option. Don't want to ever curtail.

00:55:59.000 --> 00:56:08.000
That's what we're looking… all the other options first. Here's an example of the modeling that we've done. This is just one of many that Nick and I have prepared.

00:56:08.000 --> 00:56:17.000
Um, some… Up front, top bullets say what the assumptions were going into this. This is net of…

00:56:17.000 --> 00:56:27.000
The PV share, that 30 megawatt share, that's going to send… Cindy or Kirtland. So we take that out, and it takes out the battery share that they got as well.

00:56:27.000 --> 00:56:37.000
So we take that out of this calculation here. It includes a… what I talked about, um, I didn't actually mention it, but I'll mention it now, is, uh, we're looking at the potential of.

00:56:37.000 --> 00:56:44.000
Shifting when we run the CGTG, uh, away from just being aligned with when Lance operations occur.

00:56:44.000 --> 00:56:48.000
To when it actually suits the entire pool load and generation profiles better.

00:56:48.000 --> 00:56:55.000
So we can use it to help support when we need it the most, and not run it when we don't want it.

00:56:55.000 --> 00:57:00.000
And yet, you know, the National Lab wants to run the unit. They have a sunk cost that they pay.

00:57:00.000 --> 00:57:04.000
Just to have the facility, so it doesn't do them any good to have it not running.

00:57:04.000 --> 00:57:10.000
So, this is a nice way we can get them the runtime that they're seeking to optimize their resource.

00:57:10.000 --> 00:57:20.000
As well as fitting our load and generation profiles. Now, this is a pretty complicated diagram here. You'll see there's 24 columns. This represents one year starting from January through December.

00:57:20.000 --> 00:57:26.000
Um, each of the columns, um. Is… alternates between day and night.

00:57:26.000 --> 00:57:31.000
So, mainly because we have daytime PV, and we have nighttime battery.

00:57:31.000 --> 00:57:39.000
Um, so that's why I broke it up like that. And you can see from the colors that, uh, current generation is the gray bar. That's based on the historical data from the.

00:57:39.000 --> 00:57:46.000
Past, uh, three years. Not including the recent past is 22 through 24.

00:57:46.000 --> 00:57:51.000
Calendar years. It was a fiscal year. Calendars, yes.

00:57:51.000 --> 00:58:01.000
Um, that's what the gray line on the bottom, above the gray bars, above the middle line there, the zero line, represent. The black lines represent when we could anticipate running the combustion turbine.

00:58:01.000 --> 00:58:11.000
Cgtg, um, you'll see that. Run it through the, uh, late… summer, fall, winter, and then stop in February.

00:58:11.000 --> 00:58:15.000
That's so that we don't have excess power during the hydro runoff season.

00:58:15.000 --> 00:58:19.000
Which we typically get. Hydro is, uh, what color is that?

00:58:19.000 --> 00:58:29.000
That's built into current generation, excuse me. Um, is there anything else to say here? The blue line, top there, is, uh, the actual historical load.

00:58:29.000 --> 00:58:33.000
Over the same time frame, from calendar year 22 to 23.

00:58:33.000 --> 00:58:40.000
Versus, no, that was just the last year. Was it 3-year average of the load. And the orange line up there represents.

00:58:40.000 --> 00:58:45.000
What we've seen out of Lance, if you add in Lance over the past couple years, what we've seen out of that.

00:58:45.000 --> 00:58:51.000
And you can see it's, uh… Kind of varies, a little less than 20 megawatts.

00:58:51.000 --> 00:58:55.000
That you would expect it to run if it was at full power.

00:58:55.000 --> 00:59:02.000
Uh, is there anything else I want to say here? Yeah, so there's two solar blocks. You look in the yellow bars.

00:59:02.000 --> 00:59:11.000
And the top piece has a darker, bolder black outline around it, and that represents the… a daytime solar.

00:59:11.000 --> 00:59:15.000
Piece of 50 megawatts if we were to market that off.

00:59:15.000 --> 00:59:22.000
What… if you took that… so you could take that top section of the yellow columns away, and that would show what we have net.

00:59:22.000 --> 00:59:32.000
If we marketed 50 megawatts of it off, just for. Comparison, and to speak to that option I mentioned about making a sale of that excess PBB.

00:59:32.000 --> 00:59:36.000
And that'd be around the clock… that'd be throughout the year.

00:59:36.000 --> 00:59:43.000
Um, the yellow piece below that with the… less bold outline is the excess PV that we.

00:59:43.000 --> 00:59:51.000
Would have, um… or the PV that we'd have available during the day, and any piece of it that is above that blue load line.

00:59:51.000 --> 00:59:58.000
Represents what we would either have to sell. Or, if it's below the line, what we need to buy during the day.

00:59:58.000 --> 01:00:02.000
Likewise for the battery, on the second column, with the night column for each month.

01:00:02.000 --> 01:00:11.000
That shows current generation. Combustion turbine, and the battery being discharged throughout the night. And where we are short or.

01:00:11.000 --> 01:00:16.000
In a few cases in August and September, where we actually have a little extra power.

01:00:16.000 --> 01:00:23.000
Not if you don't include Lance in the… in the… in the load. So, I'll let you look at that for a little while.

01:00:23.000 --> 01:00:30.000
If you have any questions to…

01:00:30.000 --> 01:00:41.000
Ah, right. Um… I'd call it fuchsia, but… Magenta, fuchsia bar at the bottom, below the zero line represents how much PV is going to charge the battery.

01:00:41.000 --> 01:00:50.000
During the day. So, a lot going on here. So, Ben, yeah, this is a very complex plot with a lot of information. Can you tell me at a high level.

01:00:50.000 --> 01:00:59.000
What is this plot telling us? Is this telling us that our generation is well-matched to our low, not well-matched to our load? We need to do something because of this?

01:00:59.000 --> 01:01:05.000
These results, or… or what? It's telling us that at night, we're pretty good through most of the year.

01:01:05.000 --> 01:01:08.000
We're a little late. If you look in March, uh, night.

01:01:08.000 --> 01:01:17.000
And… April night. Kind of short there. The rest of the ones, they're all within, you know, 5 or 10 megawatts, which is pretty easy to handle on a.

01:01:17.000 --> 01:01:20.000
On a market purchase basis, we can deal with that without much trouble.

01:01:20.000 --> 01:01:28.000
Um, March and April are a little trickier. Um, and it all depends on what kind of, uh, runoff we get from a snowpack.

01:01:28.000 --> 01:01:37.000
Could be better some years, could be worse other years. That's areas we're looking at. The rest of it is telling… the message tells us we have too much PV that we need with the.

01:01:37.000 --> 01:01:44.000
With the 170 minus the 30. Going to Cindy or Kirtland.

01:01:44.000 --> 01:01:51.000
And that's why we're looking for ways to… market that… or extra piece of solar.

01:01:51.000 --> 01:01:56.000
If we did sell off the 50 megawatt block. We'd be looking pretty good.

01:01:56.000 --> 01:02:01.000
Here, especially, you know, you look… you look at where the small yellow bar.

01:02:01.000 --> 01:02:05.000
Going without the dark, bold outline lies, and it's pretty close.

01:02:05.000 --> 01:02:10.000
To plus or minus to where you need to be. Again, this is an average.

01:02:10.000 --> 01:02:21.000
Of 3 years of historical data. It's not necessarily a representation of where each future year will be as loads increase, so it's just taking.

01:02:21.000 --> 01:02:25.000
If you looked at it from the recent history, this is where we lay.

01:02:25.000 --> 01:02:33.000
Yes, and… Yeah, there's other averages going on, so…

01:02:33.000 --> 01:02:41.000
But a general sense, this is where we're at. There'll be specific days and specific hours when you're way off.

01:02:41.000 --> 01:02:52.000
That just happens. Weather variations, it's unavoidable, you know, a cold snap, people turn on their resistive heaters, what are you gonna do? You gotta meet the load. And that's where our normal scheduling processes come in for.

01:02:52.000 --> 01:03:01.000
Anticipating daily and hourly loads that we do anyway today.

01:03:01.000 --> 01:03:07.000
Not to any other questions. I will move on. This is a summary sheet, like I said, they're roughly in order.

01:03:07.000 --> 01:03:12.000
This is the same thing, however, it gives the preference, kind of a preference scale from very high to very low.

01:03:12.000 --> 01:03:22.000
Well, uh, we perceive to be the… where we think… which of these options we think are… are preferred. Um, starting with selling LRS and a term sale.

01:03:22.000 --> 01:03:31.000
And send your Kirtland sales being very high to high. Optimizing the CGTG, medium, high, and then going on down from there, down less and less optimal.

01:03:31.000 --> 01:03:39.000
Primarily because they introduce more market risk. If you're going to sell… if you're counting on selling power into this day-ahead market.

01:03:39.000 --> 01:03:44.000
You don't know what the price is gonna be. So there's some price risk associated with that.

01:03:44.000 --> 01:03:53.000
You may get… make some money. You may lose money. Um, hard to characterize that, because that's looking out, you know, 10, 5… 2, 5, 10, 20 years.

01:03:53.000 --> 01:04:02.000
Don't know where that's gonna be, and our load's gonna be changing over those times. Like I said, that's something… a subject for a further, more refined financial analysis.

01:04:02.000 --> 01:04:23.000
Sorry if I missed it, but why is selling LRS limited to 10 megawatts? Because that's all we have of LRS. We have 10 megawatts. That's our total. Yeah, sometimes you only get 9 megawatts because of a… transmission line congestion, but we're hoping that will go away with the regional transmission organization. That's the whole purpose of a RTO, is to.

01:04:23.000 --> 01:04:30.000
Optimize transmission paths so you don't have congestion. Okay. Okay, thanks. And I will point out, um.

01:04:30.000 --> 01:04:38.000
There are also things where, because we have. Contracted rights for transmission lines now to get our LRS power down. There is a…

01:04:38.000 --> 01:04:45.000
Likelihood that we'll actually be able to get a financial benefit from those rights. They call it rollover rights, and congestion pricing.

01:04:45.000 --> 01:04:51.000
There are mechanisms we… part of our future financial analysis, again, but that we believe we can optimize on those transmission pads.

01:04:51.000 --> 01:05:01.000
Um, we don't have the same. Rights anymore to… dedicated, firm transmission on those lines, but we will get a financial benefit when.

01:05:01.000 --> 01:05:14.000
When we sell power into the market and pull it out at our… receipt point. So, we'll get more into that when we talk about, you know, these markets, E to M and Markets Plus.

01:05:14.000 --> 01:05:21.000
I had a question on option 6. I don't know if you can go back to slide 14 easily.

01:05:21.000 --> 01:05:26.000
But I wanted to make sure I understood the assumption. Get more Bess. Sounds great.

01:05:26.000 --> 01:05:36.000
But get more, does that mean we own the resource, or we're leasing the resource? The only way we've been even contemplating it now is if the Foxtail Flats.

01:05:36.000 --> 01:05:41.000
Under that agreement, if they extended the capacity of the facility.

01:05:41.000 --> 01:05:49.000
At Foxtail Flats. Okay. Not tear out the solar panels. No. No, they have plenty of room. They could potentially add more best capacity.

01:05:49.000 --> 01:05:57.000
At a cost. They'd have to do it really fast, though, because they'd have to get all the, you know, the understanding with P&M and the interconnection to make sure that they.

01:05:57.000 --> 01:06:04.000
It's all in… lined up. Um, they haven't got me any prices yet, so I can't even speak to that. But like I said.

01:06:04.000 --> 01:06:15.000
I don't believe that the cost-benefit-to-cost ratio is sufficiently high to merit this as it is. And that's probably the only realistic best in the timeline we need by 25%. Yes, there are other options down the road.

01:06:15.000 --> 01:06:21.000
We're still looking at. All these other longer-duration storage technologies, um…

01:06:21.000 --> 01:06:30.000
You know, waste to hydrogen, um, pumped hydro, uh. Energy Dome, they're still all in play, but none of them are…

01:06:30.000 --> 01:06:45.000
There yet. Yeah. Where we can go buy one. I appreciate their little… it's a little premature to add option 8, you know, really get best, not just pay somebody for best. And I guess… if we're looking at 1-5 year, I mean, as we're looking at, like, 7 years out, maybe…

01:06:45.000 --> 01:06:51.000
Another option of actually having a resource of this, because then that adds a lot of resilience, especially if it's.

01:06:51.000 --> 01:06:59.000
Up here on the hill somewhere. Thanks. So, Ben, is the government still paying 30% of.

01:06:59.000 --> 01:07:06.000
The solar… the bill for Foxtail Flats? They, uh, believe the developer is using, instead of the, uh.

01:07:06.000 --> 01:07:12.000
Investment tax credit, which is the 30% you're referring to. I believe they're going for that production tax credit.

01:07:12.000 --> 01:07:23.000
Which has a different structure. And I don't know how much they're gonna get off of that. There's… It's tiered, depending on what pieces you can hit. And they are eligible for that, they believe, because they have.

01:07:23.000 --> 01:07:36.000
Met the, uh, criteria for substantial construction. Prior to the certain date. Right, and so I guess my real question is, is there a drop-dead date to where after that date.

01:07:36.000 --> 01:07:44.000
They don't get a credit for any new BESS.

01:07:44.000 --> 01:07:51.000
Probably. I'd have to check into that. I think that… I think, like they said, when I asked the question, they said we need to move fast on it.

01:07:51.000 --> 01:07:57.000
Exactly, that's… that's more… if we miss that date, well then, economically, it's a whole other world.

01:07:57.000 --> 01:08:05.000
Yes. Right. That doesn't mean there aren't other options, as Board Member Hevner said, for other storage down the road. Right, sure. Okay, thanks.

01:08:05.000 --> 01:08:12.000
Sorry, so based on your last comment, is that one reason the term sale option seems appealing? Because that gives you.

01:08:12.000 --> 01:08:25.000
This sort of, uh… you know, you can wait out the best. Yes, it takes… it takes the financial risk for market exposure and market risks of selling that power away from us for that term.

01:08:25.000 --> 01:08:32.000
And yet maintain some flexibility down the road, as our loads potentially increase. Cindy or Kirtland's loads potentially increase.

01:08:32.000 --> 01:08:39.000
Battery technology. Or battery technology, and we can sync it at a good, better cost. Right. I can't imagine this future.

01:08:39.000 --> 01:08:54.000
5 or 10 years from now, where energy storage isn't. A lower cost. It just… Seems to me it has to be. There's so much pushing for it.

01:08:54.000 --> 01:09:06.000
All right, I'll skip back ahead to where I was. Uh… are there any last questions on this subject before we move on to the hydro facilities review?

01:09:06.000 --> 01:09:14.000
You know, Ben… Uh, you outlined back in the risk exposure slide.

01:09:14.000 --> 01:09:19.000
A number of load. Uncertainties mostly associated with LANL.

01:09:19.000 --> 01:09:28.000
Um, I mean, our… We could, for the short term, we can predict pretty well what our load, the county load, is going to be.

01:09:28.000 --> 01:09:33.000
Uh, yeah, there's diurnal fluctuations, of course, and there's some… some seasonal variation.

01:09:33.000 --> 01:09:40.000
But, you know, those are, uh, pretty reproducible. The laboratory.

01:09:40.000 --> 01:09:45.000
Loads are… harder to predict.

01:09:45.000 --> 01:09:55.000
When you look out a few years. Uh, and that's… I mean, the… load prediction is one of the big things we're wrestling with.

01:09:55.000 --> 01:10:02.000
As we look at this whole electrical issue. Over the next several decades, what's the load going to be, and when?

01:10:02.000 --> 01:10:08.000
Well, on the county side. The changes are probably going to be gradual enough. We can see them.

01:10:08.000 --> 01:10:12.000
5 years in advance, 10 years in advance, what we're going to need.

01:10:12.000 --> 01:10:20.000
That's not necessarily so true on the laboratory side. And of course, you know, Lance Byte Run and LanceBiteNotRun.

01:10:20.000 --> 01:10:25.000
Uh, you know, that's a… something that can happen on a much shorter basis.

01:10:25.000 --> 01:10:30.000
There's a lot of uncertainty. In the lanel load.

01:10:30.000 --> 01:10:36.000
I don't know what it was… what the environment was in 1985 when the ECA was.

01:10:36.000 --> 01:10:46.000
And its basic concept and structure was developed. But, uh… maybe this wasn't as much of an issue then.

01:10:46.000 --> 01:10:52.000
But we look at the laboratory now, and, you know, they're predicting big increases in their demand.

01:10:52.000 --> 01:11:02.000
For… but they've always predicted big increases in their demand, and rarely met them, because they… They predict getting every program they ever.

01:11:02.000 --> 01:11:07.000
Dreamed of, plus, of course, the last time they predicted it was.

01:11:07.000 --> 01:11:12.000
They were anticipating a lot of electrification. That'll probably happen, but it'll be slower.

01:11:12.000 --> 01:11:18.000
Um, lot of risk on that side. It doesn't appear to me that.

01:11:18.000 --> 01:11:27.000
In the pricing structure for the ECA. That there… that risk.

01:11:27.000 --> 01:11:34.000
Is taken really into account. It seems like. The variations are on their side.

01:11:34.000 --> 01:11:44.000
And the county is taking the risk. Is that a fair interpretation of how the ECA is currently structured?

01:11:44.000 --> 01:11:49.000
Chair Gibson, I have to be careful what I say here and how I word this, so I don't misspeak.

01:11:49.000 --> 01:11:55.000
Um, I would say that is… a…

01:11:55.000 --> 01:12:04.000
Factual representation of the risks that the county takes upon as the primary.

01:12:04.000 --> 01:12:12.000
Owner of the power supply agreements. That is absolutely correct. Um, and that a lot of the majority of the load.

01:12:12.000 --> 01:12:19.000
Forecasting variations are on the… laboratory side. So I agree with those basic facts.

01:12:19.000 --> 01:12:27.000
As far as the ECA goes. Where it is now, and where we are going to be in the future. There are some proposed changes.

01:12:27.000 --> 01:12:38.000
Again, I can't speak to it, because, um. I don't want to, uh… break the, uh, DOE's procurement rules about disclosure of information.

01:12:38.000 --> 01:12:43.000
Don't know what I can say about that, but we are looking to.

01:12:43.000 --> 01:12:48.000
Provide a more equitable. Trade-off between risk and.

01:12:48.000 --> 01:12:55.000
Between the county and the DOE as we go forward. I'm glad to hear that.

01:12:55.000 --> 01:13:00.000
I hope that we see something like that when we finally see the ECA.

01:13:00.000 --> 01:13:05.000
Draft. Right. When we get to the point where we could talk about it, I'll be able to go into more detail. Okay.

01:13:05.000 --> 01:13:21.000
Thank you. Not seeing any other questions. We'll move on to Hydro Facilities Review. This section will be fairly quick. Before you move on, are you looking for some feedback right now on these option preferences?

01:13:21.000 --> 01:13:26.000
I'll take whatever you have to give me. Happy to eat. Listen.

01:13:26.000 --> 01:13:33.000
Well, I don't want to put the board on the spot. If it's, uh, uh… not useful to you at this point.

01:13:33.000 --> 01:13:39.000
Everything for… there's a lot of things going on, a lot of moving pieces, and I try to roll them all together in here. That's why I've mentioned.

01:13:39.000 --> 01:13:45.000
That's why I gave you all the options we're looking at, that's why we're talking about all the different battery storage, you know.

01:13:45.000 --> 01:13:53.000
Storage long-duration storage technology, it's all in there. Okay, and that's why we did the summary page, just so we could…

01:13:53.000 --> 01:14:03.000
Circle a few, or X out a few. Yeah, well, it kind of looked that way, and so before we moved on, I thought, uh, maybe you'd be looking for some comment from the board, so I will… Please.

01:14:03.000 --> 01:14:12.000
See if anyone wants to comment. And don't all jump at once.

01:14:12.000 --> 01:14:24.000
Where's the option for building a nuclear reactor up here? That's still in the play. All these other resources are still in play. Like I said, this is purely focused on Foxtail Flats and the peace on the Hydros.

01:14:24.000 --> 01:14:33.000
We're still looking at geothermal, still looking at, uh… You know, even though I don't want to say it, gas resources or other things like that, or hydrogen resources.

01:14:33.000 --> 01:14:38.000
We're still looking at nuclear if something materializes that we can actually get our hands on.

01:14:38.000 --> 01:14:47.000
Is cost-effective. This is only for 20 years. Most of those things are out approximately that far, if not further.

01:14:47.000 --> 01:14:52.000
The right things progress. Okay.

01:14:52.000 --> 01:14:58.000
So what of these options could you just… do, anyway, right?

01:14:58.000 --> 01:15:05.000
I mean, like, you don't need our… do you need our approval to do some things, or are you just gonna do sensible things when they… when they emerge?

01:15:05.000 --> 01:15:09.000
The sensible things… Option one.

01:15:09.000 --> 01:15:14.000
3, 4… 5 require no.

01:15:14.000 --> 01:15:22.000
No board action. That's something we can do operationally. Do those things.

01:15:22.000 --> 01:15:28.000
What else… so, so 1, 3, 4, 5, so what… then what do you want, um, views on?

01:15:28.000 --> 01:15:37.000
Um… The others? Two is a matter of opportunity. If we can find a term sale, like I said, 1 to 5 years, 10 to 50 megawatts.

01:15:37.000 --> 01:15:45.000
We'll bring that to you and say, hey. Should we do this? Man, would it be… would it be more accurate just to call these scenarios.

01:15:45.000 --> 01:15:56.000
They're not really options, they're just scenarios, right? They… there are scenarios, but they're not mutually exclusive, and if we get one scenario, for example, option 2, scenario 2.

01:15:56.000 --> 01:16:00.000
Then we may not need to do. Scenario 5.

01:16:00.000 --> 01:16:08.000
For example. Sorry, question. Number three, why is that only high, not very high?

01:16:08.000 --> 01:16:14.000
What's the drawback there? That's because that's dependent on. The need for Cindy or Kirtland.

01:16:14.000 --> 01:16:27.000
For the additional part. Okay, so, when you give your preference, it's also factoring in, sort of, probability? Yeah, it's kind of likelihood of things. Where I think these all fit together? Yeah, this is one I know I can pursue, and it'll… I can make this happen.

01:16:27.000 --> 01:16:37.000
Without much effort. It seems almost like it'd be more likely than the term sale, no? Well, I gotta… I gotta lean on a term sale right now. Okay, so you're feeling good about this. Affective blow-up.

01:16:37.000 --> 01:16:47.000
So today, uh, term sales option two. It could change to be option 3.

01:16:47.000 --> 01:16:56.000
In a week. This is a major long-term strategy. Almost philosophy thing.

01:16:56.000 --> 01:17:04.000
And I don't think it's fair to put that entirely on the back of the staff, just what they can do, so I think, uh.

01:17:04.000 --> 01:17:09.000
We… We are obligated to be.

01:17:09.000 --> 01:17:15.000
Involved here. Um… And for my own…

01:17:15.000 --> 01:17:20.000
Opinion at this point. I think you've done a good job of.

01:17:20.000 --> 01:17:29.000
Prior… of prioritizing isn't quite the right term, but maybe so. Anyway, listing the options more or less in order of preference, or at least.

01:17:29.000 --> 01:17:34.000
I could more… more or less agree with him. Obviously, 1, 2, 3.

01:17:34.000 --> 01:17:46.000
Are, uh, something more desirable than. 6 or 7, uh, you know, trying to pick between 3 and 4 if we had to do that, well, that's a little bit finer grain, but…

01:17:46.000 --> 01:17:54.000
In terms of the overall ranking that you've given here, it seems to me, from what we've seen so far.

01:17:54.000 --> 01:18:01.000
When we don't understand EDAM very well. Uh… Yeah, I think you've done a pretty good job of, uh.

01:18:01.000 --> 01:18:15.000
Of listing, uh, listing them in order of preference. Um, the, uh, I know you'd like to down-select a few of them, and I would… if we needed to do that tonight, I'd start from the bottom and.

01:18:15.000 --> 01:18:18.000
And work my way up. I don't know if I'd down-select.

01:18:18.000 --> 01:18:26.000
5 out of the 7, but uh… anyway, I think the first ones, the first several that you have listed there are.

01:18:26.000 --> 01:18:31.000
Certainly preferable to the ones further down on the list. Um.

01:18:31.000 --> 01:18:37.000
Selling PV through EDAM. Again, I just… I don't understand that one enough.

01:18:37.000 --> 01:18:44.000
But, uh, um… Anyway, that's… that's one… one board member's opinion.

01:18:44.000 --> 01:18:49.000
Well, although you do point out this is a snapshot in time, right? So in 5 years.

01:18:49.000 --> 01:18:55.000
Number 6 may be moved up to number 1, right? So, I don't… I wouldn't necessarily.

01:18:55.000 --> 01:19:03.000
Remove anything from the table. Um, just because we want to keep everything on the table going forward.

01:19:03.000 --> 01:19:07.000
Right? At this moment, this is the proper order, it seems.

01:19:07.000 --> 01:19:13.000
How I would put it. Yeah, and… and he's keeping, you know, he's talking about.

01:19:13.000 --> 01:19:22.000
Term sales of maybe 1 to 5 years. That keeps options open. Exactly. You know, we… we're anticipating our load's going to increase.

01:19:22.000 --> 01:19:32.000
The lab, probably, but we don't really know. Uh, but, you know, in 5 or 10 years, we're probably… we're gonna need more power, and then things are going to look different.

01:19:32.000 --> 01:19:39.000
That too, yeah. Thank you for your input. Appreciate it. Any other comments from the board?

01:19:39.000 --> 01:19:51.000
Agreement that I think this… this is really complex. Thanks for presenting it at a high level. There's lots of details, of course, but I think I agree with the assessment on the preferences or the ranking.

01:19:51.000 --> 01:19:54.000
Thank you for your patience. This took a while to get through.

01:19:54.000 --> 01:20:00.000
Thank you for doing it. We… it's, uh, useful to do things like this.

01:20:00.000 --> 01:20:04.000
All right, let's go back to the presentation, and we'll get to the hydro section.

01:20:04.000 --> 01:20:11.000
That's only a couple of slides, I think. So, problems?

01:20:11.000 --> 01:20:17.000
Let's see… my clicker's not doing anything. There we go. Okay.

01:20:17.000 --> 01:20:24.000
I'm not gonna go over the details here, um… This is looking at the past three fiscal years for.

01:20:24.000 --> 01:20:31.000
Both of the hydro facilities, separately and combined, showing the three classes of, uh.

01:20:31.000 --> 01:20:40.000
Expenses, labor and benefits, non-labor expenses, and for AbiQ, debt service. There's no debt service for Elvado, so that one just has labor and benefits and non-labor.

01:20:40.000 --> 01:20:45.000
If you look at it over the past… Three years, and the final.

01:20:45.000 --> 01:20:52.000
Left-hand column is the average of those three fiscal years. In the middle, between those two.

01:20:52.000 --> 01:20:55.000
Big Abraqueue and elvado sections with the… with the line there.

01:20:55.000 --> 01:21:02.000
Uh, is the Abacu Generation. Total megawatt hours for each of those fiscal years.

01:21:02.000 --> 01:21:08.000
Um, and you can see that it has… dropped significantly in FY2025.

01:21:08.000 --> 01:21:18.000
From the two prior years. And you can see the energy cost, dollars per megawatt hour. You just take those total costs for the fiscal year, divide it by…

01:21:18.000 --> 01:21:21.000
Total megawatt hours for that year, and you get a dollar amount.

01:21:21.000 --> 01:21:31.000
Um, start at 3328, went up to $59 for the past fiscal year, with an average over the 3 years of $38.31 per.

01:21:31.000 --> 01:21:36.000
Megawatt hour. For Evato, get down to the bottom of the screen there, you see Elvado?

01:21:36.000 --> 01:21:43.000
The generation and the… uh, is significantly lower than…

01:21:43.000 --> 01:21:50.000
Abbecue, primarily because of the repair work to the dam face that was occurring during that time period.

01:21:50.000 --> 01:21:57.000
It has since climbed up in FY2025 with the. Limited amount of water.

01:21:57.000 --> 01:22:03.000
That's flowing, primarily on the weekends, that number is still relatively small.

01:22:03.000 --> 01:22:13.000
But bigger than it was the prior two years. And you can look at the total cost there per unit of energy is average of $717 per megawatt hour.

01:22:13.000 --> 01:22:19.000
Which seems high, and it is, but that's considering there was almost no generation for 2 plus years.

01:22:19.000 --> 01:22:30.000
And minimal generation for the past year. Combined, what we really want to do is combine those two to say, okay, we have two facilities, what's the total cost for both facilities combined?

01:22:30.000 --> 01:22:35.000
And that's what the last two bottom rows show. Combined generation and the combined unit.

01:22:35.000 --> 01:22:39.000
Not unit cost, I guess it is unit cost per megawatt hour.

01:22:39.000 --> 01:22:45.000
Uh, again, higher in FY2025 due to low production at both facilities.

01:22:45.000 --> 01:22:59.000
With, uh, 3-year average of $63.11. Just a detailed question. Does this include the transmission costs? Because we bear all that as well, right? Is that built into this? This is all expenses. This is everything, okay.

01:22:59.000 --> 01:23:09.000
Capital projects, labor, benefits… transmission, anything that's a pool expense under these approved resources.

01:23:09.000 --> 01:23:15.000
Is included in here.

01:23:15.000 --> 01:23:25.000
Any questions?

01:23:25.000 --> 01:23:30.000
All right, we'll move on. For context, I put in the…

01:23:30.000 --> 01:23:37.000
Historical generation from both of the facilities over the past… 15 calendar years.

01:23:37.000 --> 01:23:48.000
I apologize for the fiscal calendar year. Difference, but that's how I had the data, and… That's how it came out here. So you could see it. Um, you can see back in the…

01:23:48.000 --> 01:23:54.000
You know, 2010 plus area, region, uh, Elvado was doing pretty good. It almost matched.

01:23:54.000 --> 01:24:01.000
Have a queue. And then, uh, we did the, uh, generated rewind project, and that took it off for a while there.

01:24:01.000 --> 01:24:04.000
That's when things dropped off and went to zero for a few years.

01:24:04.000 --> 01:24:11.000
And then it came back pretty strong. Another 18,000 megawatts, I'm not sure what happened in 2018, why that one was so low.

01:24:11.000 --> 01:24:22.000
That… well, I don't know what that was. I think that was a… We had to do some repairs from the rewind, and they had some issues with the shaft seals, I believe. That might be what that is.

01:24:22.000 --> 01:24:28.000
But then it came back with Gusto in 2019, both must have been a good water year. Um, both facilities were.

01:24:28.000 --> 01:24:42.000
Putting out a lot of power, um, and it's… was, uh, Elvado dropped off after that in 21, when the, uh, dam faced repairs started, and they began draining the lake.

01:24:42.000 --> 01:24:55.000
And that gets us to 2024, when it was still… Under repair, and we had no power generation. Looking at AbicQ, you can see there was a big year there in 2023 when it had a lot of water, a lot of snow, um, and then it has…

01:24:55.000 --> 01:25:01.000
Return to a more average amount. In 2024.

01:25:01.000 --> 01:25:07.000
You can edit the subtotals, um, a lot more over the past 15 years out of AbiQ.

01:25:07.000 --> 01:25:15.000
Largely because Elvado didn't have water. For many of the years… some of the years, and it was under major repair for the other years.

01:25:15.000 --> 01:25:22.000
So, just for a little bit of context there, so you can have a feel for how they've done historically.

01:25:22.000 --> 01:25:29.000
So… One thing, if… I'll go back here real quickly, I didn't mention this specifically, but if you look at the…

01:25:29.000 --> 01:25:36.000
Abbecue labor and benefits versus the Elvado labor and benefits. You can see that the Elvado Labor and Benefits is significantly higher.

01:25:36.000 --> 01:25:46.000
Then, Abigail, there's a couple of reasons for that. One is because even though all of the hydro staff work and support both facilities.

01:25:46.000 --> 01:25:56.000
Maybe not equally, but they both work at both facilities, in particular the supervisor supports both facilities roughly equally. However, in 2025, when you see a big.

01:25:56.000 --> 01:26:03.000
Uh, number 454,000 plus for Elvado labor and benefits. That was when.

01:26:03.000 --> 01:26:10.000
The Adam Cooper, the… plant supervisor retired, and he was on pre-retirement leave.

01:26:10.000 --> 01:26:14.000
Going through sick leave, burning off his sick leave, and remaining.

01:26:14.000 --> 01:26:20.000
Uh, annual leave. At the same time, we had an acting supervisor.

01:26:20.000 --> 01:26:25.000
Working on the job, our current supervisor now, Don Wickers, and so we had two people charging.

01:26:25.000 --> 01:26:29.000
All their time. Two supervisors, the highest paid, charging their time to Alvado.

01:26:29.000 --> 01:26:34.000
Um, subsequently to this, or in the future, we're going to.

01:26:34.000 --> 01:26:39.000
Reallocate the supervisor's time to split it more evenly, so you won't see this.

01:26:39.000 --> 01:26:47.000
Uneven split between AbbeyQ and El Auto. And that's what this slide speaks to.

01:26:47.000 --> 01:26:53.000
Next steps. Um, I know we, uh… I've talked about this before, about.

01:26:53.000 --> 01:27:00.000
You know, the hydros and their financial performance. This is just a… initial look at it from a very high level.

01:27:00.000 --> 01:27:07.000
What we plan on doing in the future is looking for cost-saving opportunities, um, determining, you know.

01:27:07.000 --> 01:27:19.000
What systems and subsystems. At Elvado in particular, if the water levels aren't there, or if it goes under another repair, long-term repair project.

01:27:19.000 --> 01:27:27.000
What can we do to minimize costs there? I'm gonna, you know, there are regga… there may be regulatory and safety requirements that we can't avoid.

01:27:27.000 --> 01:27:35.000
We may not be able to entirely mothball the plant, just so to say, um, simply from a safety standpoint, and FERC may not allow it.

01:27:35.000 --> 01:27:40.000
The dam owners may not allow it as part of their public safety plan and their emergency action plans.

01:27:40.000 --> 01:27:47.000
We may need to have some minimal capacity or operational capacity there, just to meet those requirements.

01:27:47.000 --> 01:27:57.000
And so the goal is to have this information. And these net 3 bullets, and whatever else we decide we need, uh, available in time to use for the coming budget cycle.

01:27:57.000 --> 01:28:02.000
So that we can build that in there as best we can.

01:28:02.000 --> 01:28:11.000
Ben, are you anticipating. That the discussion of Elvado and options, if there is one.

01:28:11.000 --> 01:28:19.000
Will occur before the budget? Hearings start? Are you thinking of…

01:28:19.000 --> 01:28:26.000
Incorporating them into the budget hearings. I would say…

01:28:26.000 --> 01:28:38.000
Prior to the hearings themselves. Good. It'll be too late to have it, say, in February or March. Well, this is bigger than just a budget issue.

01:28:38.000 --> 01:28:44.000
And we don't want to get… don't want the… The budget hearings to bog down in this.

01:28:44.000 --> 01:28:49.000
More technical discussion. I would rather have the technical discussions in this.

01:28:49.000 --> 01:28:59.000
The coming remaining months of this year. And they may not get down to the level of, yeah, we can mothball it for this cost, and we're gonna do that. It may be more like, you know, we're gonna eliminate these.

01:28:59.000 --> 01:29:04.000
These services and these functions in order to optimize the cost as much as we can in this time period.

01:29:04.000 --> 01:29:08.000
For the coming fiscal year, and build that into the budget from the get-go.

01:29:08.000 --> 01:29:16.000
Okay. Thank you.

01:29:16.000 --> 01:29:22.000
And that's all I have. If there are any, uh… Further questions?

01:29:22.000 --> 01:29:29.000
I welcome them. Anyone?

01:29:29.000 --> 01:29:43.000
Very much. I know there's a lot that went… went into this, um… And there's a lot that… to still go… to go yet. Thank you for your time and listening.

01:29:43.000 --> 01:29:54.000
Okay… We'll move from that to the annual update on the gas distribution system.

01:29:54.000 --> 01:30:03.000
Clay. Thanks, Chair Gibson, members of the board, that's a hard act to follow.

01:30:03.000 --> 01:30:11.000
You guys make fun of me for long presentations, but… fall short of that this evening.

01:30:11.000 --> 01:30:24.000
All right, so hopefully you don't have quite as many issues for us to think about. This one should go… fairly easily. Um… So yeah, this is our… my annual update, uh, for the gas system.

01:30:24.000 --> 01:30:30.000
Um, I actually do have some changes from previous years. Uh, it was one of the first years that we, in.

01:30:30.000 --> 01:30:40.000
Recent years that we've done. Um, some updates to the gas system, so you'll see that here in a minute. Um, at a glance, you can see our gas system.

01:30:40.000 --> 01:30:48.000
Um, we… it's separated, of course, because of White Rock is not connected to the town site, and they are somewhat different gas systems.

01:30:48.000 --> 01:30:56.000
The, uh, gas system we have in White Rock was, uh, inherited, essentially, from P&M.

01:30:56.000 --> 01:31:04.000
And so it was P&M's gas system that was installed, so it's… it's more of a traditional style of gas system, 60-pound.

01:31:04.000 --> 01:31:13.000
60 psi, um, uniform pressure throughout the system, whereas, uh, Town Site has a 100.

01:31:13.000 --> 01:31:20.000
Psi kind of trunk. Transmission, and we dropped the pressure at all of those red.

01:31:20.000 --> 01:31:30.000
Dots, those are our pressure regulation system, um… stations where we drop it to 20 psi for distribution pressure.

01:31:30.000 --> 01:31:40.000
Uh, we do have 3 border stations in the town site, and that's where we take, uh, delivery of gas from the New Mexico gas, which is a 300-pound system.

01:31:40.000 --> 01:31:50.000
Uh, White Rock has the one border station now. Um, we operated a section of line a few years… just a few years ago.

01:31:50.000 --> 01:32:01.000
To move that border station. We built it, uh, specifically for White Rock, and it's right there near the fire station, so… That kind of helped our reliability and kind of the overall functionality of it.

01:32:01.000 --> 01:32:08.000
Functionality of the White Rock system. Um… Town site, like I said, has a 100 psi trunk.

01:32:08.000 --> 01:32:16.000
And we have… that's about 15 miles of piping, and then the rest of the system's 20 pounds, so that's 97 miles of piping.

01:32:16.000 --> 01:32:21.000
And then White Rock with the 60 PSI system, 26 miles.

01:32:21.000 --> 01:32:27.000
Um, you can see that we, uh, our projects, our primary projects this year were DP Road.

01:32:27.000 --> 01:32:38.000
Very complicated, uh. Project with a lot of difficulties throughout. It's just, um, everything was really…

01:32:38.000 --> 01:32:48.000
It was, like, tentacles, just gas lines going everywhere around old buildings, and… thing, uh, everything down there hadn't really been…

01:32:48.000 --> 01:32:58.000
Managed with zoning, like the rest of the town has, so… It was kind of an ad hoc gas system, and so cleaning it up.

01:32:58.000 --> 01:33:14.000
We really just abandon everything, cleaned it up, and now everything is standardized and much more manageable, so… There's a lot of relief from a lot of us about having this new gas system at DP Road, and everything was upsized all the way down.

01:33:14.000 --> 01:33:20.000
To the bottom to support any development along the south side of DP Road.

01:33:20.000 --> 01:33:33.000
Uh, Court Street was not a planned project, but was, um… was kind of a surprise project that we had to… we had to embark on because we found a gas leak that.

01:33:33.000 --> 01:33:38.000
It had been coming and going. We couldn't pinpoint where we were… where we were detecting gas.

01:33:38.000 --> 01:33:50.000
And finally, it became apparent the gas line was very deep there, so it was distributing in different areas, and it took us a while to really find where it was, but it was right next to a resident's home.

01:33:50.000 --> 01:33:58.000
So, we really made… you know, it was… it was a difficult project because they had to put up with.

01:33:58.000 --> 01:34:04.000
Quite a lot of mess right out of their front door. We had to remove their entire driveway. We were almost in their garage.

01:34:04.000 --> 01:34:09.000
And, um, you know, it was just one of those difficult things. But at the same time.

01:34:09.000 --> 01:34:13.000
Once we found it, we realized that we needed to do.

01:34:13.000 --> 01:34:19.000
A complete overhaul of that section. What had happened is sometime in the 1980s, um.

01:34:19.000 --> 01:34:31.000
They had… they were inserting plastic lines into the original steel line, and they… they… I think what happened was there were a lot of bins to get it through around the homes and through the backyards.

01:34:31.000 --> 01:34:38.000
And it just… they couldn't do it. There were too many bins, so they just transitioned… left that section of steel there, thinking that.

01:34:38.000 --> 01:34:44.000
Sometime in the future, near future, they were gonna do it, and it just never was really documented.

01:34:44.000 --> 01:34:51.000
And so it got forgotten, and that's why we keep good records. And then, of course, we have the third-party project, Elk Ridge.

01:34:51.000 --> 01:35:00.000
We'll talk about that here in a minute. Uh, let's see… our gas sales by sector. We… we do, um…

01:35:00.000 --> 01:35:06.000
Categorize, you know, who all is buying gas from us. You can see that, in general.

01:35:06.000 --> 01:35:12.000
Gas sales have been down. They've been trending down. Of course, last year was a warm year.

01:35:12.000 --> 01:35:28.000
So, you know, we're hoping that, generally speaking, people are, um… using more efficient gas appliances and being more gas-wise, but we are adding some customers, especially, like, the Hills.

01:35:28.000 --> 01:35:37.000
Which is a benefit to the gas system and the financial stability of our gas market, because, um.

01:35:37.000 --> 01:35:42.000
It's a lot of customers, but not a lot of use of gas, so that is helpful.

01:35:42.000 --> 01:35:49.000
Um, for us in operations. Uh, DP Road, um…

01:35:49.000 --> 01:35:57.000
So, you can see that we installed a large amount of 4-inch gas line, and that was really to replace everything that was on DP Road.

01:35:57.000 --> 01:36:12.000
And it… it helps to serve in terms of, uh. It's good for the condition of the gas system and capacity to serve. Then we had some 2-inch gas, and then, of course, a lot of 1-inch gasoline… gas services.

01:36:12.000 --> 01:36:26.000
We abandoned a lot of… a very hodgepodge of gas. We didn't have any leaks. There was good integrity with it. It was just… it was very hard to manage because it was chaotic.

01:36:26.000 --> 01:36:37.000
Court Street, the isolated steel section I was talking about. Uh, once we… identified what the problem was. We had to trace down where all that.

01:36:37.000 --> 01:36:42.000
Old, isolated steel section went, and the more we did it, the more we realized.

01:36:42.000 --> 01:36:51.000
We needed to bring it out into the street and courts and pine, and… then at some point, we had to reconnect what was there.

01:36:51.000 --> 01:36:57.000
So when we did that, we realized that. The project wasn't meant to be.

01:36:57.000 --> 01:37:02.000
What they had done wasn't meant to be permanent, because they kind of had some temporary fittings.

01:37:02.000 --> 01:37:07.000
And once we found that, we realized we needed to replace the whole thing, so we scrambled.

01:37:07.000 --> 01:37:16.000
Uh, with the engineering, uh, division. To get this done, and it was… it was difficult because it was right after it had snowed.

01:37:16.000 --> 01:37:24.000
In early November. Um, last… about a year ago, so it was right after I had given my update to you.

01:37:24.000 --> 01:37:31.000
And, uh, so then the project… took on this whole life as if it was a capital project during the winter.

01:37:31.000 --> 01:37:44.000
So it was kind of difficult. And then… and it's only been… It seems like it's gone on until quite recently that we've just finally gotten everything cleaned up from it. But we abandoned a large piece of.

01:37:44.000 --> 01:37:53.000
Isolated steel, which was a relief. Yeah. Uh, service lines are customer-owned, right? Uh, no.

01:37:53.000 --> 01:37:58.000
Um, when I say service, it is a delivery line on our side.

01:37:58.000 --> 01:38:06.000
Essentially, we, the gas operator, we own the system all the way to the customer. You own it to the meter? Yes.

01:38:06.000 --> 01:38:12.000
And then the customer takes it over from the meter. Yeah. I mean, okay, that's why I asked the question, because I'm used to the word service.

01:38:12.000 --> 01:38:20.000
Being from the point of delivery downstream, which would be customer-owned. Right. Yeah, they kind of get loosely.

01:38:20.000 --> 01:38:48.000
Interchange, but we call it a service as opposed to the larger distribution line, yeah. But it is… it is how we deliver gas, but in… in the… in the case with gas, it's just a category of line usually means it's a smaller line that came… that branches off of the main. Another way of saying it, it's a tap off the main line. Exactly. To the gas… Yeah, so… Once it gets to the customer meter, that's where their regulator drops the pressure, and then that.

01:38:48.000 --> 01:38:54.000
Is a completely different, uh, jurisdiction that oversees… And that's what I was… because of your story about.

01:38:54.000 --> 01:39:08.000
Court Street, and almost getting in the guy's garage. That made me start thinking that, well, maybe because of the work that you did, you had to actually go and do stuff on their side of the meter to make things right. Uh, well, eventually we did have to have that.

01:39:08.000 --> 01:39:19.000
That part done, too. Although their gas is… the resident's gas system had good integrity. They… luckily, but we were… we were sensing gas in one of their walls.

01:39:19.000 --> 01:39:25.000
So we knew it… and we checked everything inside their house, you know, because we do have, uh.

01:39:25.000 --> 01:39:31.000
Certified gas fitters, so they're a good, you know, gas mechanical plumbers, too. So they went in there.

01:39:31.000 --> 01:39:36.000
Did a check, and so we realized this must be coming off of our gas system.

01:39:36.000 --> 01:39:48.000
Somewhere in their front yard, and traveling. Into their house. So then we realized we had a big… we had a big problem, but it was hard to pinpoint where that was until we really…

01:39:48.000 --> 01:39:55.000
Just started tearing their… poor area up, and we had to really work with them to get it back, and…

01:39:55.000 --> 01:40:00.000
Um, we did have some help from Public Works with their, um, on-call.

01:40:00.000 --> 01:40:15.000
Concrete contractor, and so they did a good job. But we, you know, it was hard because… It wasn't just their landscaping, it was several neighbors' landscaping, and so it's taken some work to get that back. You know, people went there.

01:40:15.000 --> 01:40:35.000
Their live… their lives return to normal, and, you know, over time, we… things sink after the rain, and we had to go back out during the summer and fix it. So, um, we were playing landscapers as well all summer when this would… we'd get a phone call from a resident, my grass is sinking. And then all of a sudden, we're out there.

01:40:35.000 --> 01:40:51.000
Scooping up grass. I even helped out because it was somebody I knew who called me directly, and I'm gonna call your mom if you don't get an answer. So I, you know, and so I was like, I'll be over there, we'll do it this afternoon. Yeah, so it was kind of funny.

01:40:51.000 --> 01:40:57.000
But that's how it is in a town where you know everyone. Um, our O&M report here, uh.

01:40:57.000 --> 01:41:01.000
These are just pieces of data, you know, things that we do.

01:41:01.000 --> 01:41:07.000
Um, you know, we… we have… several, uh, regulated, um.

01:41:07.000 --> 01:41:14.000
Tasks from the PRC, which… which is really un… you know, it's… it's a federal law that gets.

01:41:14.000 --> 01:41:24.000
Handed to the state to oversee, and unfortunately, with the government shutdown… no, no, it's fortunate that it still occurs, even though we have a government shutdown, we still have to.

01:41:24.000 --> 01:41:40.000
Be responsible and follow all the rules. But, um… So, over the years, because all of our guys get shifted around from one thing to another, you know, the guy's working on the gas will suddenly respond to a sewer issue, or a water line break.

01:41:40.000 --> 01:41:47.000
Um, a few years ago, if you remember, we said, nope, we're… we're getting behind in all of our, uh.

01:41:47.000 --> 01:41:53.000
Regulated, uh, tasks, so we have a dedicated gas crew and a dedicated supervisor that.

01:41:53.000 --> 01:41:59.000
Maintains records and oversees and makes sure that all of these things are covered on a regular schedule.

01:41:59.000 --> 01:42:07.000
And so, second year in a row. All of these tasks, like continuous surveillance, pipeline patrol.

01:42:07.000 --> 01:42:16.000
And, um, atmospheric corrosion abatement, these are things that. Typically kind of would slide because we were doing something else.

01:42:16.000 --> 01:42:22.000
And we just don't let it slide anymore, and so we have… Uh, full record.

01:42:22.000 --> 01:42:30.000
Of it, and it's easily, um… proven to the PRC when we have audits and things like that. So we've gotten all of those things done.

01:42:30.000 --> 01:42:38.000
We had more gas locates this year because. Of the complicated project out at DP Road.

01:42:38.000 --> 01:42:47.000
Um, you can see what incident response activities. We did repair 10 leaks. It was 9, until we found one last week.

01:42:47.000 --> 01:43:01.000
And I had to tell Kathy I needed to edit it, because we found one, and that happened from… the guys doing their, uh, what we call pipeline patrol and continuous surveillance. They were… they were out there with the leap that…

01:43:01.000 --> 01:43:11.000
Detector, and they were picking something up, they couldn't… They didn't smell it until they were somewhere completely different, but what they did… because they were walking it down.

01:43:11.000 --> 01:43:19.000
Um, one of the gas operators. Caught something, and they started tracing it out, and sure enough.

01:43:19.000 --> 01:43:31.000
You know, they've been taught to look at vegetation and things like that, and they found a big dead spot in this person's yard where they… farther away, so it… the leak had been traveling, but they were able to trace it down.

01:43:31.000 --> 01:43:36.000
And it's only because they were… walking down the entire town that they actually found that.

01:43:36.000 --> 01:43:45.000
Um, they did talk to the resident, and he was like, yeah, every once in a while we would kind of get a little wet, but then it'd go away, and so that's kind of how gas.

01:43:45.000 --> 01:43:54.000
Can dissipate and travel somewhere else. So the… There is a reason why we have to do the pipeline patrol and continuous surveillance.

01:43:54.000 --> 01:43:57.000
Um, we did have some third-party line hits, and mainly those were.

01:43:57.000 --> 01:44:02.000
Um, from the… DP Road project.

01:44:02.000 --> 01:44:14.000
Um, you know, you get a gas contractor out there. Digging around, like I said, those gas lines were… just like spaghetti everywhere, and they would hit it, so our guys would have to go out and.

01:44:14.000 --> 01:44:26.000
And do the repairs. We were pretty much on-site, usually, so the, you know, the… the threat or the risk was low, so they were right there in most cases.

01:44:26.000 --> 01:44:35.000
Um, we had a lot of gas customer call-outs, usually what those are, are… residents in the wintertime, especially, you know, it… they're… that…

01:44:35.000 --> 01:44:40.000
Kind of is about to start up as heating season begins, people start getting their boiler.

01:44:40.000 --> 01:44:47.000
Boiler fired back up, or… or their, uh, heaters, and they'll smell gas.

01:44:47.000 --> 01:44:53.000
And so we typically, all winter long, have a lot of those call-outs, and a lot of them happen in the middle of the night.

01:44:53.000 --> 01:44:59.000
Um, yeah, so we continue to put in more cathodic protection.

01:44:59.000 --> 01:45:13.000
On the steel lines, we're… we're… the guys, like, because they're dedicated to it, they're going around and checking all of the… cathodic protection potential, and if something's low, we install more anodes.

01:45:13.000 --> 01:45:23.000
We're probably getting close to. This piece of the project going down. We're not finding any low readings, but we have to go back and check them, and.

01:45:23.000 --> 01:45:29.000
Old anodes sometimes need to be replaced. Uh, starting last…

01:45:29.000 --> 01:45:35.000
During the wintertime, we began doing… it actually was late last fall, we started doing, um.

01:45:35.000 --> 01:45:44.000
Leak surveys out at Elk Ridge when we identified that the gas lines were underneath several of the homes. So, up until July.

01:45:44.000 --> 01:45:50.000
We were performing those every month. Um, we have continued to replace, uh.

01:45:50.000 --> 01:45:59.000
Meters, both commercial and residential. And these are… give some images, just to give you an idea of.

01:45:59.000 --> 01:46:06.000
How the DP Road project looked. This… this is the clean area when we got down and away from all of the.

01:46:06.000 --> 01:46:11.000
Sort of industrial buildings. It was a real… um, nest.

01:46:11.000 --> 01:46:19.000
Up higher on DP Road, but uh… We did install gas lines down in this area, finally.

01:46:19.000 --> 01:46:27.000
Um, so any development. That occurs down there, they're gonna be able to connect to the gas system.

01:46:27.000 --> 01:46:34.000
Um, so this is just kind of an interesting image, because we had to go through several scenarios.

01:46:34.000 --> 01:46:40.000
Of how we were going to… Abandoned the old gas system and tie back in.

01:46:40.000 --> 01:46:46.000
Uh, to what was there, and it was right here in these people's backyard that we found.

01:46:46.000 --> 01:47:00.000
Some very bizarre, um… transition fittings that you could tell they… they didn't intend for it to be permanent, because they're the type of fittings that would typically… you would only put temporarily.

01:47:00.000 --> 01:47:12.000
And they had been there for quite a long time. So, it was kind of a, um… serendipitous event that… that we found the leak, because then as we went farther down the line.

01:47:12.000 --> 01:47:20.000
We realized that, uh, that… piece had some other related problems, and we were able to mitigate all of that, and then we.

01:47:20.000 --> 01:47:23.000
We did some inspection on the rest of it and found.

01:47:23.000 --> 01:47:30.000
That there was… there were no more pieces of isolated steel or transitions, so we took care of a big problem.

01:47:30.000 --> 01:47:38.000
Chloe, just a question along those lines. So, you found something there that had been placed 40…

01:47:38.000 --> 01:47:45.000
40 years ago, something like that, right? Apparently it was as temporary measure and lasted for 40 years.

01:47:45.000 --> 01:47:52.000
And you probably could… it sounds like you didn't… you couldn't find any documentation of it, there were no records of what the heck was going on. No.

01:47:52.000 --> 01:48:02.000
So, I hope this… the answer to this is an easy yes. Are we doing a better job now, so our successors 20 years from now, when we're all gone on to other things.

01:48:02.000 --> 01:48:11.000
Yeah. And something screws up, they can at least look and say, oh, yeah, they intended to do this, couldn't do this for such and so reason, or whatever.

01:48:11.000 --> 01:48:23.000
Yeah, I've thought about that, like, why we couldn't… I mean, you know, we go through old drawers, and you've… and sometimes you'll find, oh, here's a… really good set of records of this project, and it might be in the…

01:48:23.000 --> 01:48:32.000
In the late 70s, but it's… but it's, um, it's inconsistent, so you'll find a folder, of course, because back then, everybody just… ah, here you go.

01:48:32.000 --> 01:48:39.000
Here's a drawing, and some of them… some of the hand drawings are good, and some of them are very accurate. And then… you'll find something that it's, like.

01:48:39.000 --> 01:48:45.000
Hmm, there is just nothing on that, and we've gone through everything. Every filing cabinet, every archive.

01:48:45.000 --> 01:48:52.000
And… and we were able to piece together most of it and get it entered into the GIS. So when you see.

01:48:52.000 --> 01:49:14.000
These lines here, there's actually a database behind these lines with the GIS, so… so anytime we were able to find something, and this is a good project for interns or somebody who comes in, I even did it when I first started working here. You know, you… You go through old records, and… and you… oh, okay, this segment here was a project, and you place a date.

01:49:14.000 --> 01:49:22.000
Uh, material type. And anything that was in there, and if they had a contractor or whatever, you put that into.

01:49:22.000 --> 01:49:29.000
The record of that area. So we have… we've pieced together, you know, quilt style, but there are still some little gaps.

01:49:29.000 --> 01:49:49.000
And so, we've tightened that down, and I'd say we're down to the last little bit, but every once in a while, you will find a little… skeleton in the closet, and… And so, you know, we talk about the condition assessment amongst our group, and we have a good idea of the condition. We get it into the record when we have it.

01:49:49.000 --> 01:50:00.000
But, like I said, you'll find these things that… It was missing, and we assumed that that was all plastic, and so it was a real surprise to find this rather.

01:50:00.000 --> 01:50:08.000
Lengthy piece of… of… isolated steel that had no cathodic protection, and that's what it was. It was a corrosion pit.

01:50:08.000 --> 01:50:13.000
Right at their driveway, where they would salt. The driveway, and then have a drainage.

01:50:13.000 --> 01:50:25.000
Coming off of it, it was going down, and it was moist all the way down to that… gas line, and there was water down there, and so that's… that's how it happened. We dug around, and.

01:50:25.000 --> 01:50:30.000
Most of it was actually in good shape. It was just that little spot.

01:50:30.000 --> 01:50:34.000
That had that problem. And so, it probably could have sat there another 40 years if it hadn't.

01:50:34.000 --> 01:50:45.000
I've been wet right there. So, that's how we found it. But… you know, when we dug this area up right here, we found those weird transitions, you know?

01:50:45.000 --> 01:51:03.000
They were basically transitions that you would see on a water line, not on a gas line. But it sounds like the record that we're keeping going forward is the GIS. Yeah. Yeah, GIS, and then… and then we use a… a database called Energy WorldNet, and that's where our gas system records go in, and that's where all of our.

01:51:03.000 --> 01:51:08.000
Operator qualifications are maintained, so we have to keep records of everybody.

01:51:08.000 --> 01:51:13.000
Who works on the gas system, what… when they were certified at 90 different.

01:51:13.000 --> 01:51:27.000
Procedures, so we have to keep records of everything. So it's like… you know, you… like a nuclear facility, you have to keep records of every little thing the gas system requires that now. It'd be interesting to go back and see when.

01:51:27.000 --> 01:51:39.000
The federal… laws were made for this, and what the rules were for keeping records, because our state probably has just, over time, with more incidents, become.

01:51:39.000 --> 01:51:48.000
Much more, uh… Um, focused on… us following the rules. I don't know how it was in the 80s, you know, how…

01:51:48.000 --> 01:51:56.000
How the audits worked in the 80s, I don't know how they, um, they probably had paper records, and at some point, oh, these are old.

01:51:56.000 --> 01:52:04.000
And maybe that's how they got thrown out. But everything that we have is now in there.

01:52:04.000 --> 01:52:12.000
And I know James and I have gone through a lot of old filing and musty old files to find stuff in, and.

01:52:12.000 --> 01:52:15.000
When I first came here, I went through a lot of really old AutoCAD.

01:52:15.000 --> 01:52:21.000
You know, and you're going back with floppy disks, trying to piece together this AutoCAD file.

01:52:21.000 --> 01:52:29.000
And see if you can piece together what they did. So, yeah, it's been a… it's been an investigative process over the last 25 years that I've been here.

01:52:29.000 --> 01:52:38.000
That we did it. Uh, so now moving on to kind of a whole different section of the, uh.

01:52:38.000 --> 01:52:44.000
Presentation. So, uh… the project out at Elk Ridge, it's ongoing.

01:52:44.000 --> 01:52:50.000
Um, it's, um, it's been moving well apace. We got an update today, actually.

01:52:50.000 --> 01:53:03.000
Um, we… we're out there, uh, daily to do inspections. Um, it… it's… you know, they've run into a few hiccups because they don't know where other utilities are, so they've… they've had.

01:53:03.000 --> 01:53:10.000
Some issues working around the other utilities, but as far as the mains are concerned, they're almost complete.

01:53:10.000 --> 01:53:15.000
In putting the mains in. A lot of the service still need to be, uh.

01:53:15.000 --> 01:53:19.000
Put in, but, um… It's going pretty well.

01:53:19.000 --> 01:53:27.000
The problem is that, um, now they're getting into the portion of work where they're getting up to the homes, and they're.

01:53:27.000 --> 01:53:34.000
They're starting to look at how the coordination is going to be in tying the homes in.

01:53:34.000 --> 01:53:38.000
To the new gas system. And, uh, you know, we had a couple of.

01:53:38.000 --> 01:53:46.000
Incidents where, you know, um… Gas was knocked out, and then to put them back on, you know, we had to do some inspections. We found out that.

01:53:46.000 --> 01:53:53.000
There's gonna be a lot of, um… out of compliance, um…

01:53:53.000 --> 01:53:58.000
Home… plumbing and appliances. So, that…

01:53:58.000 --> 01:54:03.000
They're gonna have to work that out with their residents to help them.

01:54:03.000 --> 01:54:11.000
Get things up to code, because things have to follow the plumbing code, and then they have to do a new pressure test that's observed by the state.

01:54:11.000 --> 01:54:23.000
So, there's a couple of things there. The state… um, has to… schedule all of that with… they have to coordinate it and schedule… so Cartwright Plumbing, which is a residential plumber.

01:54:23.000 --> 01:54:30.000
Has to schedule all of that with the state. State seems to have a few… seems to have some problems with staffing.

01:54:30.000 --> 01:54:36.000
They were looking at doing maybe 10 a day. But right now, that's still up in the air.

01:54:36.000 --> 01:54:41.000
Um, 10 a day, starting… maybe late October.

01:54:41.000 --> 01:54:52.000
It's… I'm afraid that this is going to go well past heating season, and we really can't be doing that during the winter, especially if we're afraid that people have some.

01:54:52.000 --> 01:54:56.000
Plumbing issues, and a lot of the plumbing. Code issues are fairly small.

01:54:56.000 --> 01:55:04.000
They're like little fittings, a little strainer, maybe a catch pan on the bottom, things that are easily fixed, but.

01:55:04.000 --> 01:55:13.000
Um, if we do that, like. Middle of January, and suddenly they can't get their heat turned back on that day. That's just a…

01:55:13.000 --> 01:55:18.000
It's too risky, so, um, we're gonna have to look at a Plan B and start.

01:55:18.000 --> 01:55:24.000
It's not our project right now. We're overseeing the part of the municipal side.

01:55:24.000 --> 01:55:28.000
So it's, um, kind of hard to get in the middle of.

01:55:28.000 --> 01:55:35.000
Of a third-party, uh. Project. So, you know, we're letting them, uh, work that out with the residents.

01:55:35.000 --> 01:55:45.000
And we'll assist with any technical, um, information we can provide, but… So is the main… problem that you're worried about, then, if I take it…

01:55:45.000 --> 01:55:49.000
What I thought I just heard is basically getting the state out in time.

01:55:49.000 --> 01:55:56.000
It is. Okay. Yeah. Yeah, Cartwright's great. They're doing a good job. I think the coordination is going well.

01:55:56.000 --> 01:56:03.000
Um, it's really… timing, you know, the project, there were some delays in getting it started and off…

01:56:03.000 --> 01:56:07.000
You know, off the ground. It would have been better if it would have gotten started in, like, April.

01:56:07.000 --> 01:56:17.000
But it really didn't get kicked off till, like, around July 1st. So… you know, those months are lost, and so I think we're just gonna have to take.

01:56:17.000 --> 01:56:26.000
Take it as, you know, we lost those 3 months, now we're gonna have to… shove the rest of the project to next spring.

01:56:26.000 --> 01:56:32.000
Well, they are gonna have to. That's just the way I'm seeing it, but we'll see what happens. If they can start.

01:56:32.000 --> 01:56:37.000
Getting at least the process going, and we have some warm days.

01:56:37.000 --> 01:56:39.000
They can push it until we see a real cold snap.

01:56:39.000 --> 01:56:45.000
That's kind of how we… we would do it. But again, that's up to them.

01:56:45.000 --> 01:56:52.000
They give us some updates about it, and they… today, I did see that they're recognizing that.

01:56:52.000 --> 01:56:59.000
The issue with the state permitting is probably their biggest. Constraint.

01:56:59.000 --> 01:57:07.000
Uh, on our side, we've been providing inspection services, which are required, records management, so we have to take all the records of.

01:57:07.000 --> 01:57:16.000
Every person who touches that gas system. Um, all of their certifa… they… we actually certify their welders in our shop, so… so we're…

01:57:16.000 --> 01:57:22.000
We're, um… We're very involved in the municipal side of the installation.

01:57:22.000 --> 01:57:25.000
Uh, we do, like I said, we oversee the pressure testing.

01:57:25.000 --> 01:57:34.000
Their welds, all of that kind of stuff. Um, we are… um, physically, ourselves, uh.

01:57:34.000 --> 01:57:39.000
Doing the meter manifold installations. Most of them are double meters. There are a few singles.

01:57:39.000 --> 01:57:45.000
Um, there are over 81 installations. We use a new type of meter.

01:57:45.000 --> 01:57:51.000
They don't really have mechanical parts in them, they're more of a, you know, 21st century style meter.

01:57:51.000 --> 01:57:59.000
Um, and, um… We provide pressure regulators, all the valves, fittings, and of course, the system operation. And it should be noted that.

01:57:59.000 --> 01:58:04.000
Um, all of that aside. We're gonna take over ownership of it forever.

01:58:04.000 --> 01:58:12.000
So, it's gonna be ours, our responsibility, and we've got to maintain it and do all the reporting and everything.

01:58:12.000 --> 01:58:19.000
That takes a lot to do. Clay, you said something earlier about doing the monthly inspections.

01:58:19.000 --> 01:58:34.000
Through July, I think you said. Are we still doing monthly inspections? And if not, why not? You know, I think… I'll have to ask our gas supervisor. I think because we're out there all the time, they kind of stopped doing… going in underneath everybody's homes.

01:58:34.000 --> 01:58:41.000
And everything, so they just kind of, you know, they've been out there every day, so they haven't gone back and done.

01:58:41.000 --> 01:58:46.000
Yet a full-blown leak survey, um, just because they're out there every day.

01:58:46.000 --> 01:58:55.000
Um, but I think we're gonna have to really start now that… now that, uh, the project is gonna go into the winter, we need to do another… we need to keep doing the leak survey.

01:58:55.000 --> 01:58:59.000
Um, I think what's gonna happen is there might be a time.

01:58:59.000 --> 01:59:09.000
Where the project halts. For a bit, uh, and let winter get through the toughest part, and so, yeah, we need to keep doing the leak surveys, no question about it.

01:59:09.000 --> 01:59:23.000
That was kind of a… compromise we made with the PRC, um, that it's best practice to just keep performing the leak survey so that we ensure that the gas system still has good integrity.

01:59:23.000 --> 01:59:33.000
So, yeah, we need to continue it now. So, Clay, if the project stops during the winter, if you're foreseeing that as a likely outcome, right, at some point you're going to have to.

01:59:33.000 --> 01:59:37.000
Stop the project. How many of our customers are going to be without gas?

01:59:37.000 --> 01:59:43.000
No one, we're keeping the current gas system in operation, so we're… I see. So, really.

01:59:43.000 --> 01:59:55.000
Once… once the coordination with the state is really off the ground, it's like they would do the pressure test, move them over that day, so they would only be without gas for a portion of a day.

01:59:55.000 --> 02:00:04.000
So that's why we can't just do this, you know, ad hoc, willy-nilly. We have to… everything has to be really ready and in place.

02:00:04.000 --> 02:00:10.000
And they have to know that all their appliances are… up to code, and everything's truly ready.

02:00:10.000 --> 02:00:26.000
Before we pull the plug, and they're on the dark side of the moon, let's say, for that… for that little bit of time where you just can't stop. You're gonna have to… get it done. Um, and so we need to ensure that everything is compliant before we do it.

02:00:26.000 --> 02:00:32.000
Thanks. That's going to take some time, and you don't want to do that in the wintertime and cut people off, yeah.

02:00:32.000 --> 02:00:45.000
Um, this is a typical… we kind of mocked up. What it's going to take for each of the meter sets. Um, you know, every… you know, think about it, but it's kind of like a little plumbing job under your sink. You know, you got all these little parts and pieces.

02:00:45.000 --> 02:00:50.000
So we, uh, you know, worked it up and found our dimensions, what it's going to take.

02:00:50.000 --> 02:00:59.000
And so, that's… that's kind of typically what one looks like. On the left side, you would have the riser that comes up out of the ground.

02:00:59.000 --> 02:01:05.000
It's gonna come up out of the ground, um, go through two different meters, or two different regulators, two different meters, and then.

02:01:05.000 --> 02:01:16.000
You'd see pipes going out of the… you see those, uh… pipe ports off the top of those meters, and then those would go into the homes. Why two?

02:01:16.000 --> 02:01:22.000
What's that? Wait, 2 meters? Yeah, right there. Um, that way we could run one service line.

02:01:22.000 --> 02:01:29.000
So, you would have fewer trenches, and uh… Um, just headaches.

02:01:29.000 --> 02:01:35.000
To get it to… because the homes are close together, and so you can manifold it.

02:01:35.000 --> 02:01:55.000
On the backside of one home and the front side of another, and you just have one trench going to a… to a common meter location, and then the service lines would then go… Okay, so this is 2 meters to 2 homes? 2 homes, yes. Okay, that makes sense. Oh, yeah, I'm sorry, I didn't… Okay. That's the simple answer. Thank you. So, Clay, just out of curiosity, is that Blackguard, or is that steel?

02:01:55.000 --> 02:02:03.000
They're steel. Okay. Yeah. It kind of looks like black iron. Well, it is dark-colored. I mean, it's carbon steel.

02:02:03.000 --> 02:02:15.000
And then… and then what we do is we… we… we sand it and then paint it. Yeah, so then… and that's… that's part of the issue out there now, is that a lot of it hasn't been maintained, so there's a lot of…

02:02:15.000 --> 02:02:28.000
Atmospheric corrosion. It's nothing… it's nothing concerning, but in time, you know, you don't want things to be corroded in a gas system.

02:02:28.000 --> 02:02:33.000
Yeah, so the project, I said it began… really, it began in July.

02:02:33.000 --> 02:02:39.000
And I think it was proposed that it was supposed to be done late October and early November, but the.

02:02:39.000 --> 02:02:49.000
Schedule being… how it slipped so much. It's just not there yet. Um… They are more than 50% complete, with the municipal…

02:02:49.000 --> 02:02:55.000
Municipal-side piping, they're more on that west end now. They've gone around the loops and up the middle.

02:02:55.000 --> 02:03:01.000
So they're pretty far along. Um… No portions have been put into place. Another.

02:03:01.000 --> 02:03:13.000
Piece of the puzzle is that LANL has this, uh, currently they have a regulator station out there, and it's dropping the pressure going into it. We've decided to eliminate that and eliminate.

02:03:13.000 --> 02:03:28.000
Yet another complexity, so they're gonna be… Um, on a 60-pound system, which is what Lanel delivers there, so we're just keeping it as a 60-pound system, just like in White Rock, and that's pretty typical, that's what you'd find in Albuquerque.

02:03:28.000 --> 02:03:32.000
Places like that. But, um… So they've got some reconfiguring.

02:03:32.000 --> 02:03:41.000
To do right outside of the park itself, on the. In that fence where Lionel's meter is, and that reg station, we have a plan together.

02:03:41.000 --> 02:03:48.000
But they haven't really… Um, I haven't begun the work. We thought it would be like, oh, you'll be here next week, but…

02:03:48.000 --> 02:03:55.000
They're putting together, um, because there is kind of a chain of custody of that.

02:03:55.000 --> 02:04:04.000
And they're putting together documents and rules and responsibilities, but. Um, I would expect to see them begin that… their portion of it anytime.

02:04:04.000 --> 02:04:10.000
Um, like I said, there will be some complications with the mobile home division.

02:04:10.000 --> 02:04:18.000
From CID, and uh… yeah, it's not gonna be done this winter, I think.

02:04:18.000 --> 02:04:24.000
And this is kind of what it looks like. Um, you know, the… there's… some of them have long trenches.

02:04:24.000 --> 02:04:29.000
This is one of the single meter sets, and that's, like, one of the first homes inside, but most of them.

02:04:29.000 --> 02:04:35.000
Or this double meter set that is gonna be a common meter placed.

02:04:35.000 --> 02:04:42.000
And then two different lines run from that point. Residential side.

02:04:42.000 --> 02:04:48.000
And looking at a different angle, you see that then it branches off to the other home.

02:04:48.000 --> 02:04:57.000
And they have some pretty interesting equipment to dig these little tiny trenches.

02:04:57.000 --> 02:05:08.000
That's it. I'll just add that, you know, over the years, we've invested a lot in the gas system, and it really.

02:05:08.000 --> 02:05:14.000
It's a really good gas system, you know, we… over time, because we have.

02:05:14.000 --> 02:05:20.000
Had a lot of contact with our gas system in pretty much every neighborhood. We do find little.

02:05:20.000 --> 02:05:27.000
Unknown things. We found something actually near Philo's house, and it, you know, it took us a little while to fix this.

02:05:27.000 --> 02:05:37.000
Kind of complicated, and it's usually on the services, where same thing happened. They were inserting a line, and for some reason, they would hit a bend or something and stop.

02:05:37.000 --> 02:05:42.000
And that… those are the… those are the little issues where we're finding. And fortunately.

02:05:42.000 --> 02:05:54.000
Most of that happens in… isolated areas in the Los Alamos system, which is on a 20-pound system. White Rock, we know everything. White Rock, the records are there. We got it from PNM.

02:05:54.000 --> 02:06:02.000
And we don't find any… surprises in White Rock. White Rock System's great. Steel is in great shape.

02:06:02.000 --> 02:06:06.000
Um, and it's all in the same condition, and we know.

02:06:06.000 --> 02:06:12.000
What we have in White Rock. The… the… The unknowns we find in town site.

02:06:12.000 --> 02:06:18.000
The lines that run in backyards, we'll just find this… weird little section of steel, and a few…

02:06:18.000 --> 02:06:28.000
Quite a few years ago, maybe around. I don't know, 2000 and… 6 to 2008, we had a big project to go through where we did have.

02:06:28.000 --> 02:06:37.000
Records of isolated steel sections, and we went through and we removed… we fixed all those. So, the ones that we had records of, we actually went and fixed.

02:06:37.000 --> 02:06:46.000
Um, now we're finding the ones that we don't. Have records of. And so, um, that's how we find them, is just kind of here and there, because there's no way to predict it.

02:06:46.000 --> 02:06:54.000
You know, so really, it's until it… fails, unfortunately, but usually they're what we call Grade 1 leaks. It's just somebody.

02:06:54.000 --> 02:07:01.000
A jogger, and I've even found it running around town, I'm like, I smell gas, and I'll go back.

02:07:01.000 --> 02:07:08.000
And call the guys, and I'm like, hey, I smell gas at this address, and sure enough, they'll go out and find me, oh, we found a little leak on there.

02:07:08.000 --> 02:07:17.000
Service line. Um… So, you know, otherwise, the integrity of the gas system is very good. We have a lot of…

02:07:17.000 --> 02:07:25.000
Miles of line, because, you know, we have the mesas, and so there's a lot of line that has to manifold out, and then.

02:07:25.000 --> 02:07:36.000
Over the years, we actually connected them, so we have a lot of backfeed contingency, too. So, um… You know, that just adds to a high level of reliability and the.

02:07:36.000 --> 02:07:45.000
The gas lines themselves are in very good shape, so… It's a great gas system, really.

02:07:45.000 --> 02:08:01.000
Yeah, so I'm just curious if we've had any customers disconnect from the gas system in the past year because of… since they've electrified their house. Does anybody know that? You know, that's a… that's an interesting question. We'd have to… I… I don't know that… that answer, but we're not seeing that, really.

02:08:01.000 --> 02:08:07.000
People have… we… what we do see is that there's a lot of… Um, renewal.

02:08:07.000 --> 02:08:17.000
Of appliances so that people have now. A lot of heat pumps, and they're just more efficient systems. So we're seeing a lot of replacement of old.

02:08:17.000 --> 02:08:30.000
You know, burn a lot of gas, burning appliances, and then, um… energy-efficient windows and insulation, because that really reduces the gas use just.

02:08:30.000 --> 02:08:35.000
A huge amount, so… Um, in, you know, in my opinion.

02:08:35.000 --> 02:08:48.000
You know, until we really are generating electricity, you know, with carbon… you know, carbon-free sources, you know, the gas system for now is in great shape, and.

02:08:48.000 --> 02:08:54.000
You know, uh… getting your house more energy-wise is probably one of the most…

02:08:54.000 --> 02:09:02.000
Um, green things that we could be doing, instead of, like, you know, forcing them to get off of the gas system, because.

02:09:02.000 --> 02:09:06.000
Um, you know, when we talk to a customer, they're like, I can't believe.

02:09:06.000 --> 02:09:17.000
You know, just replacing my windows and putting insulation on my roof, my gas bill went down to hardly anything all winter long, you know? So, you know, those are the kind of stories we hear.

02:09:17.000 --> 02:09:27.000
Yeah. Other questions or comments?

02:09:27.000 --> 02:09:32.000
Thank you, Clay.

02:09:32.000 --> 02:09:38.000
Okay, last agenda item. Is, uh…

02:09:38.000 --> 02:09:44.000
The annual self-evaluation of the board. And…

02:09:44.000 --> 02:09:49.000
This… the… valuation…

02:09:49.000 --> 02:09:58.000
Questions, if you will, or the forms have been distributed. So everybody's had a chance to comment, but here's your final chance to comment.

02:09:58.000 --> 02:10:06.000
Um, before we actually… do it, and… That one problem.

02:10:06.000 --> 02:10:12.000
Those, I think, will be distributed soon. Um.

02:10:12.000 --> 02:10:20.000
One thing I would ask is, uh. Are we going to get the results from the board?

02:10:20.000 --> 02:10:26.000
And the staff separately? Are they going to be combined again?

02:10:26.000 --> 02:10:31.000
They would be combined. Because that's how the whole code, um…

02:10:31.000 --> 02:10:42.000
Software collects the information. Their anonymous responses. But they don't flag them as to whether they're bored or… No.

02:10:42.000 --> 02:10:47.000
Staff, um, that… That's unfortunate, but okay, that's what it is.

02:10:47.000 --> 02:10:55.000
You could ask… insert a question that asks. If they want to indicate whether they're board or staff.

02:10:55.000 --> 02:11:02.000
We could do that. That may help, that may… differentiate some. Well, that would tell us whether.

02:11:02.000 --> 02:11:13.000
All five board members responded, but it wouldn't tell you whether the answers from, uh, corresponded… came from a board or came from a staff.

02:11:13.000 --> 02:11:19.000
Uh, uh, person. Catsy, could we run just two of them?

02:11:19.000 --> 02:11:27.000
I can look into that. I'm… I could probably… I can check with Julie tomorrow and see.

02:11:27.000 --> 02:11:33.000
We do have different perspectives. Hopefully there's some similarity, but uh…

02:11:33.000 --> 02:11:40.000
Um, there is… People look at things differently, depending on where we sit.

02:11:40.000 --> 02:11:45.000
So, Eric. Well, speaking of looking at things differently, I'm glad you said that.

02:11:45.000 --> 02:11:49.000
Um, I'm a little nitpicky thing here about surveys in general.

02:11:49.000 --> 02:11:57.000
It's impossible to strongly agree. Grammatically and by definition. So, what I would prefer to see…

02:11:57.000 --> 02:12:04.000
Is for strongly agreed to simply be agree. And then the other one partially agree.

02:12:04.000 --> 02:12:10.000
And I know I'm out to lunch on this one, because this is the way that all surveys are done.

02:12:10.000 --> 02:12:13.000
But depending on what culture you come from, what country you're born in.

02:12:13.000 --> 02:12:22.000
Strongly agree, makes no sense. Okay, I've said my piece. Thank you.

02:12:22.000 --> 02:12:29.000
I hear you, but I'm not sure that… We want to try to change all of the headings.

02:12:29.000 --> 02:12:40.000
This toy surveys are the same problem would apply on the other end of the spectrum. Exactly. Exactly, there's no such thing. But… so we just kind of take it for granted that.

02:12:40.000 --> 02:12:45.000
We… we… assume that they mean what…

02:12:45.000 --> 02:12:55.000
You know… Well, we could assume that, and then probably proceed as we always have. That's what we're gonna do.

02:12:55.000 --> 02:13:03.000
I just wanted to say it, okay, thank you. Your grammatical point is noted. Thank you, thank you.

02:13:03.000 --> 02:13:09.000
Other thoughts, questions, comments?

02:13:09.000 --> 02:13:21.000
Eric had a suggestion that we add a question. Um, the question he proposed adding was that the board actively seeks out input from the community and incorporates this.

02:13:21.000 --> 02:13:31.000
In their strategic initiatives. Um, I am going through here, thought I found…

02:13:31.000 --> 02:13:41.000
Um, three questions that basically already cover that. Um… the, uh…

02:13:41.000 --> 02:13:53.000
3a and B. Board understands its obligations to see that the organization acts in the best interests of utility customers and citizens of the county.

02:13:53.000 --> 02:14:00.000
Me, the board actual diligence and objectivity on behalf of utility customers and the county.

02:14:00.000 --> 02:14:07.000
And then, um, this is now… 6… 7, excuse me, 7, 8.

02:14:07.000 --> 02:14:13.000
The board strives to represent the interests of the entire community it serves.

02:14:13.000 --> 02:14:21.000
And it seems to me that covers… what Eric's trying to get at. Do you agree, Eric?

02:14:21.000 --> 02:14:29.000
Yeah, I saw those same three questions. And I guess my thinking is more, what do we do to…

02:14:29.000 --> 02:14:40.000
Ascertain the spirit of the community. You know, I mean, we can send out surveys. I keep getting this concept that we ought to set up a table at Smith's and just…

02:14:40.000 --> 02:14:53.000
You know, as people walk in, have a comment section, you know, and say, hey, we're the Board of Public Utilities, now's your time. Yeah, just actually try… and I don't know how to do that, but the concept is.

02:14:53.000 --> 02:15:00.000
Do we go out, and how do we solicit? Community feedback. How do we do that?

02:15:00.000 --> 02:15:04.000
Well, how we do it is separate from do we do it?

02:15:04.000 --> 02:15:08.000
What you propose is the Board actively seeks out input. Right.

02:15:08.000 --> 02:15:16.000
And the… the last of those three questions says, the board strives to represent the interests of the entire community.

02:15:16.000 --> 02:15:22.000
It serves, well, to represent the interests we have to. We have to seek out input.

02:15:22.000 --> 02:15:34.000
I think that's where the gap is. Because, yeah, we want to… act on their feedback, but do we actually get it?

02:15:34.000 --> 02:15:46.000
We can only work with what we get. So, I would… so my problem when I saw your… your edition, um, was.

02:15:46.000 --> 02:15:54.000
I didn't understand what actively meant. Um, and what our role would be in that. Um, so, for example, a lot of the surveys that we've been.

02:15:54.000 --> 02:16:02.000
Conducting… actually haven't been us, is DPU, and we've discussed them, we've given our comments on them.

02:16:02.000 --> 02:16:07.000
Um, but it's actually from the department that those officials surveys go out.

02:16:07.000 --> 02:16:12.000
As a board, we do things like request comments at every meeting we have.

02:16:12.000 --> 02:16:19.000
We receive emails and respond, but we also attend many of the, um.

02:16:19.000 --> 02:16:29.000
Farmers markets, for example. And so, that in particular, I would guess, is sort of an active approach to looking for feedback and comments.

02:16:29.000 --> 02:16:35.000
Um, there's also various sort of workshop-y kind of informative or informational, um.

02:16:35.000 --> 02:16:43.000
Meetings that we participate in. Usually done in conjunction with board… with DPU activities, department activities.

02:16:43.000 --> 02:16:50.000
So I'm not… I'm not sure it's… Yeah, so I'm not sure what you mean by actively seek out A and then B.

02:16:50.000 --> 02:16:56.000
Whether it's a, um… function, necessarily, of the…

02:16:56.000 --> 02:17:10.000
Board, beyond… what we do in collaboration with the department. So I'm a little confused there. If you wanted to add something to this section, to number 11, I would… I was trying to wordsmith it slightly.

02:17:10.000 --> 02:17:18.000
It could be the board works to ensure strategic initiatives align with county goals, community feedback.

02:17:18.000 --> 02:17:25.000
And DPU mission and goals, or mission and vision, actually. Um, there's a thought. But I'm not sure, um…

02:17:25.000 --> 02:17:36.000
It's necessary, given 3A, B, and 7. So, anyway, just… That's fine, I just wanted the discussion, that's all. I just threw it in there so we could have this discussion.

02:17:36.000 --> 02:17:51.000
Are you satisfied with the discussion? Yeah, I am. Well, I'm sorry, I guess it's just because we did go through this and did wordsmith a little bit earlier this year. So I was reasonably content with… what was there?

02:17:51.000 --> 02:17:55.000
I mean, so I'm fine, because we do have those questions in there, and I did read those.

02:17:55.000 --> 02:18:00.000
Okay, so… Are we comfortable with the…

02:18:00.000 --> 02:18:09.000
Uh, the questions here… to go forward with, with the hope that maybe we can get them separated between board and.

02:18:09.000 --> 02:18:13.000
Staff? If not, well, we'll just have to live with it.

02:18:13.000 --> 02:18:20.000
Okay, I think I'm seeing head nods all the way around, so… Good. Uh…

02:18:20.000 --> 02:18:37.000
I think that completes that one. Could I ask a question, Chair Gibson? Sure. I just need clarification on who should… received the survey, because last year you expanded it to senior managers, and then we also sent it to the council chair and vice chair.

02:18:37.000 --> 02:18:43.000
Now, do you want to expand it to all counselors, or… I just need to know who to send it to.

02:18:43.000 --> 02:18:55.000
Well, fair question. Is there any reason to change what we did last year?

02:18:55.000 --> 02:19:04.000
We can ask our council representative. Well, that's… that's probably a very good suggestion.

02:19:04.000 --> 02:19:17.000
Put, uh, put you on the spot there, Susie. Do you think all your counselors would like to provide feedback, or… Do they… are they enough involved in what we do? You're here…

02:19:17.000 --> 02:19:23.000
Every meeting, and you pay a lot of attention anyway, but I don't know how many of your other counselors do.

02:19:23.000 --> 02:19:30.000
Would it be useful feedback? Or is just one more thing they have to do? Because it does take a little while to fill these out.

02:19:30.000 --> 02:19:37.000
Everyone has a full plate, yeah. Justifies the time that we needed.

02:19:37.000 --> 02:19:43.000
Right now, because you feel otherwise. I'm all leaders, I can make a pitch.

02:19:43.000 --> 02:19:54.000
The, uh… I tend to think the way you do, that the… and we don't want… feedback that isn't informed. True.

02:19:54.000 --> 02:20:00.000
To garbage in, garbage out.

02:20:00.000 --> 02:20:07.000
Okay, thank you. Nice. Sorry. No.

02:20:07.000 --> 02:20:13.000
We asked the question, you answered it, thank you. Um, any…

02:20:13.000 --> 02:20:18.000
Any desire to change? Okay, Kathy?

02:20:18.000 --> 02:20:24.000
We'll keep going with the same… same folks. Thank you for raising the question.

02:20:24.000 --> 02:20:31.000
Anything else on this topic? If not, we're down to public comment.

02:20:31.000 --> 02:20:56.000
Is there any further public comment? Yes, there is.

02:20:56.000 --> 02:21:00.000
I'm Richard Cottrell, as I hover along here for a moment.

02:21:00.000 --> 02:21:05.000
Um, yes, I am a… Current resident of Elk Ridge.

02:21:05.000 --> 02:21:11.000
And, uh, so the… comments and information about the gas system.

02:21:11.000 --> 02:21:17.000
Was, uh, very enlightening. Glad to hear it. Um, we'll talk about some…

02:21:17.000 --> 02:21:23.000
Quality assurance issues. But, um, I woke up to the issue, but…

02:21:23.000 --> 02:21:29.000
You brought up a point that's very important. The survey.

02:21:29.000 --> 02:21:38.000
You have a list of every resident that uses gas. User services. That's a mailer. That's a mailing…

02:21:38.000 --> 02:21:44.000
Out for email or whatever to respond to. That's a good point to start with.

02:21:44.000 --> 02:21:55.000
Um, as well as… Other public areas. And, uh, I would encourage you to… I'm on your mail list, I'm on your email list. I… but I don't get that survey.

02:21:55.000 --> 02:22:00.000
I'd love to answer that survey. I don't know you all, but I see the results of what you do.

02:22:00.000 --> 02:22:07.000
So, that would be appreciated, and that's appropriate, I think. Um, okay, back to the comment about.

02:22:07.000 --> 02:22:13.000
The quality of the work. Being done by the contractor.

02:22:13.000 --> 02:22:19.000
And then what's going on. The current design… I live in, um, unit number 310.

02:22:19.000 --> 02:22:25.000
At the top of the west end of the… of the list. And we're one of the last people.

02:22:25.000 --> 02:22:30.000
That has so far been cert… been… cut in and serviced. Um…

02:22:30.000 --> 02:22:36.000
Talk to the engineer, the inspector, as well as the foreman of the project.

02:22:36.000 --> 02:22:43.000
The design has coming off the street. 30 feet, and they put the riser.

02:22:43.000 --> 02:22:47.000
With the double, and the planets but the riser, the riser's in.

02:22:47.000 --> 02:22:52.000
And put the… double regulator serving two homes.

02:22:52.000 --> 02:22:58.000
Going forward. The problem is… The trailer that we're in.

02:22:58.000 --> 02:23:04.000
That service connection is 60 feet off the street, because it comes off the back, it comes off the easeway.

02:23:04.000 --> 02:23:10.000
The two areas. That service… to that trailer.

02:23:10.000 --> 02:23:15.000
Riser is right next to the trailer. It's 40 feet away from…

02:23:15.000 --> 02:23:22.000
The planned riser and design. The… I asked them to move it.

02:23:22.000 --> 02:23:35.000
Says, but can you take it back to where it's not in the middle of the roadway? The… The parking areas, the… Sidewalks, the whole gamut of where vehicles are parked.

02:23:35.000 --> 02:23:38.000
And the answer was, we have to do it per design.

02:23:38.000 --> 02:23:44.000
Now, we may take it a few feet in the middle between the two trailers, but that still leaves a riser.

02:23:44.000 --> 02:23:50.000
Right smack dab into the middle of everything. And when the snow comes.

02:23:50.000 --> 02:23:56.000
Well, the likelihood of that getting hit are very high. That means that's going to be a problem.

02:23:56.000 --> 02:24:00.000
For a lot of people, plus the danger of the damage that this can occur.

02:24:00.000 --> 02:24:06.000
They won't make a change. Now, Cartwright's supposed to make the connection between.

02:24:06.000 --> 02:24:13.000
The riser to the traders. Okay. I understand that there's going to be a charge.

02:24:13.000 --> 02:24:21.000
To the homeowner of $1,000. 800 to 1,000, whatever the case may be. That's a rumor.

02:24:21.000 --> 02:24:25.000
Whether it's true or not, I had to catch safe, because we have not been contacted.

02:24:25.000 --> 02:24:33.000
You promised us there would be no cost. To hooking up the trailers when we discussed this back.

02:24:33.000 --> 02:24:37.000
Early in the first of the year, when I was here.

02:24:37.000 --> 02:24:43.000
I'm gonna hold you to that. And I'm gonna trace the money down. The money is the issue.

02:24:43.000 --> 02:24:48.000
It costs more money to cut that and put it in place where it needs to go.

02:24:48.000 --> 02:24:54.000
I understand that. But that's not our concern. We need a safe, installed.

02:24:54.000 --> 02:24:59.000
Out of the way, gas service. That doesn't interfere.

02:24:59.000 --> 02:25:06.000
With normal operations and the plan of the current operations of the trailer.

02:25:06.000 --> 02:25:12.000
It's not happening! I hope it does in the future. Thank you for your considerations.

02:25:12.000 --> 02:25:18.000
Um, one more thought. Every few days.

02:25:18.000 --> 02:25:27.000
Turn on the faucet, and you get a lot of air blowing out. That means they cut the water line someplace. Every day or so, they cut the water line, they cut the water, they cut the water.

02:25:27.000 --> 02:25:34.000
There's a lot of it going on. Okay, well, shall we get a little out of air, and uh…

02:25:34.000 --> 02:25:40.000
We go on and take another day. But it's sure disconcerting when you're sitting in the sink and you get splattered all over.

02:25:40.000 --> 02:25:51.000
But in any case, we will trial and tribulate. Through the construction. And we're looking for a operational system.

02:25:51.000 --> 02:25:55.000
That is very good. I'm gonna hold you guys to what you said.

02:25:55.000 --> 02:26:00.000
There was no cost. To our connection.

02:26:00.000 --> 02:26:06.000
Please. Look into this, because this rumor is starting to gel.

02:26:06.000 --> 02:26:13.000
That we're going to have a $1,000 or more. Connection fee. Pressure test, Cartwright. Whatever they want to call it.

02:26:13.000 --> 02:26:17.000
Pressure tests and inspections are not that expensive, they're less than $100.

02:26:17.000 --> 02:26:22.000
But they're going to charge $1,000. That's what I've been what the rumor is.

02:26:22.000 --> 02:26:26.000
That's not good. A lot of people won't be able to do that.

02:26:26.000 --> 02:26:35.000
You know, it's gonna hit different ways. Maybe it's gonna have to be… paid off over time. But it's still…

02:26:35.000 --> 02:26:41.000
Expense that's not planful. As to the service.

02:26:41.000 --> 02:26:45.000
Thank you. Thank you very much for your comments. Thank you for your time.

02:26:45.000 --> 02:26:52.000
And look forward for a good service, and appreciate your efforts. Thank you. Thank you. Thanks for coming this evening.

02:26:52.000 --> 02:27:07.000
Do we have any other public comment? Thank you, Chair Gibson. We have public online. If anybody would like to make a comment, please use your raise hand function.

02:27:07.000 --> 02:27:11.000
I don't see anybody with their hand up, Chair Gibson. Okay, thank you very much.

02:27:11.000 --> 02:27:18.000
Thank everyone for… Joining us this evening for another evening of fun and frolic.

02:27:18.000 --> 02:27:23.000
I was waiting for that, thank you. And, uh, we stand adjourned.

02:27:23.000 --> 02:27:33.000
And, uh, the board will reconvene in a few minutes down in the DPU conference room for a closed session.

BOARD OF PUBLIC UTILITIES  ~  WORK SESSION
OCTOBER 1, 2025  ~  5:30 P.M.
LOS ALAMOS COUNTY, NM  ~  MUNICIPAL BUILDING  ~  COUNCIL CHAMBERS


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Anyhow, but we hope everybody, or people can check in by Zoom as much as possible when they're not physically here.

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Anyhow, uh, first order of business is public comment. Do we have any public comment?

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I don't see any in chambers. Thank you, Chair Gibson, for anybody joining us tonight on Zoom, if you'd like to make public comment, please use the raise hand function.

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And if you're participating by phone, that's star 9. If anybody would like to make a public comment, please raise your hand.

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Does it look like we have public comment, Chair Gibson? Okay, thank you very much.

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We do… did have a closed session last evening, and I'd like to read a statement on that.

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The matters discussed in the joint closed session with County Council.

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Held on September 30, 2025, began at 4pm. We're limited only to the topics specified in the notice of the closed session.

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And no action was taken on any matter in the closed session.

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We request that this statement be included in the meeting minutes.

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Um, is there a motion to approve the agenda this evening?

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Sure, I'll make a motion to approve the agenda. Thank you.

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Okay, agenda approval is… Moved and seconded.

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All in favor? Proposed.

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Okay, motion passes 5-0. And that takes us immediately to our first business item.

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An upgrade on the integrated resource plan. An implementation of it, and the plan for Foxtail Flats.

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As well as a little bit of discussion about Elvado. So, Ben.

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Thank you. Chair Gibson, members of the board, Ben Ulbrich, Deputy Utility Manager for Power Supply. Happy to be here before you today. This is the latest installment of our.

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Roughly 6-month, uh, rate, repeating. Progress meetings on achieving our integrated resource plan portfolio.

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Now, with the caveat that we've deviated entirely from. What was planned in the IRP, but with that being said, we do plan on getting a new IRP as soon as we can.

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Let's see if I can get this to work. All right, so in the past, I've given you a rundown on.

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All the resources that we're. Currently pursuing… Sorry, Ben, before you get started, is there a way to get these… the slides projected on these computers?

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It's not on our screens here. We're seeing a screensaver.

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There was a big on-off button I would press it.

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Well, in any case, I don't want to hold this up any more than these technical difficulties require, so I'll just go over the first slide here. You really don't even need to see it, but.

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Um, in the past, I've covered a lot of all the resources that we were pursuing.

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Um, and what we've done in the past, and how we're moving forward. This is more tightly focused, simply looking as.

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As Chair Gibson mentioned, at Foxtale Flats, what our plans are for that, and uh… higher level, and in the future, we're gonna refine that as we go forward.

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And second, it's gonna have a little piece on… Elvado, and the Hydros, both of the hydro facilities, and kind of a high-level economic review of.

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What it's cost us over the past 3 years to… run the facilities, and how much generation we've got out of them, and what that works out to at a.

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Dollar cost per megawatt hour. For the generation from those two facilities combined.

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And we have a comment on Zoom. Jonah Ahrens would like you to define LRSAP, and CGTG.

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And a few other acronyms when you get to them. All right, I can do that. Thank you.

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Since those ones were specifically mentioned, and we're still working here on the technical difficulties, I will say LRS stands for Laramie River Station.

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Which is the coal-fired power plant of which we have a 10 megawatt.

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Market participation share for power out of that facility, and that is located in Wheatonland, Wyoming.

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Ep stands for Electric Production, which is the name of the division that I run.

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Even though my title is. Your Deputy Utility Managers for power supply. My division is called Electric Production.

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Which I will point out. Doesn't include the fact that I also do all the gas.

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Scheduling. Um, there was another one she mentioned that I don't recall. Like, BESS is Battery Electrical Storage System, or Energy. Battery Energy Storage System.

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And then the combined gas. And there was, yes, the CGTG was a combustion gas turbine generator.

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And KISO. Kiso is California Integrated System. Operator. And then the last one is FTF.

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Ftf, Foxtail Flats, I believe. Thank you. I didn't think I used that one in there, but apparently I did.

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I try to avoid acronyms where possible. So, thanks for the question.

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So, the last time I gave this, uh, update was on April 2nd, 2025.

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So, what's that for? Roughly… Six months ago, so… I'm on schedule here.

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We're still working through the issue? Just keep going. I'll just keep going then. Do we know if people who… anybody who's looking at it online, if they're seeing.

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What's up there, or what's down here? Okay.

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Good, okay. We'll just pretend we're in the movie theater. It's a little hard for the Knicks of the people who are right against the screen. Well, I have a hard copy, so I'm good. Perfect.

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All right, and if anybody needs me to stop and say what they're looking at, just go ahead and let me know.

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And as Chair Gibson asked me earlier, I welcome any questions as you get them, feel free to interrupt me. I want to, you know, get the answers to you when you're thinking about them, and we can have the.

00:08:07.000 --> 00:08:10.000
The dialogue right then and there, rather than asking you to hold them.

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The land lease approval for Foxtale Flats was delayed. If you add it all up now, to approximately 10 months. The lease is now complete.

00:08:18.000 --> 00:08:24.000
Um, they got their final approvals, went through the review periods, and it's done.

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Um, that's a go. Ben, I'm so sorry to ask a question right off the bat and slow you down. Give it, Jim. But, uh… that, uh, land lease we got in, as I understand it, came in August.

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And the, kind of, the original plan to date was the end of December last year. That's only 8 months.

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Or the extra 2 months come from? December was their deadline when they expected to have everything done.

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Um, they really only didn't get it done until this last month.

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Finally. It was August when that came through, I believe. Right, but there was also an appeal.

00:09:02.000 --> 00:09:07.000
Period. Yeah, but that was… that's when the appeal ran out. They actually got the Fonzie in July.

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So… and my understanding is that the land lease was signed very quickly, like a day or two thereafter, in August.

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So, that's 8 months. They're rolling in all the delays they had for their design into that.

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Into that process. And that's understandable. They couldn't do a lot of their procurement and engineering at their financial risk until they had the surety of their lease in place, and then they could mobilize their teams to get started.

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So, I don't… I don't necessarily hold that against them on, you know.

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Adding that extra period in there. That's my personal thing.

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You know, legally, um, contractually, I do believe they have that.

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That is allowed for under the Excused Delay Clause. So there's absolutely no more approvals that need to be done, then?

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From the land lease standpoint, that's it, I believe, and that's the last one. The interconnection agreement with PNM, that's all settled years out… years ago. Years ago, okay. So as far as I'm aware.

00:10:07.000 --> 00:10:15.000
Um, they're ready to roll. Now, new market, new tariffs, new risks may arise. I can't speak to that.

00:10:15.000 --> 00:10:19.000
However, a lot of those things are not covered under the Excused Delay Clause.

00:10:19.000 --> 00:10:24.000
Um, specifically the lease was called out as one of the criteria for.

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An excused delay, and that's what they called on.

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Cool. Satisfied? Alright, good. Well, I'm not satisfied, but I've got the answer. Answer answers as good as it's gonna get.

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I still count 8 months, not 10, but uh… as excused. So where are we now, then, in the whole process? They're still designing? They're doing final design, they're working on their procurement, they've already, you know, solicited for.

00:10:55.000 --> 00:11:01.000
Offers for the pieces that they need. Um, a lot of the long list lead items.

00:11:01.000 --> 00:11:07.000
The transformers were procured months or years ago, so that's out of the way.

00:11:07.000 --> 00:11:17.000
Um, a lot of the interconnecting. Transmission line was already constructed as part of their previous phase that the San Juan Solar to…

00:11:17.000 --> 00:11:22.000
That they did with PNM. So that's in place. They just need to go and…

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Do their final arrangements on where they're going to build things out, their grading plans, that sort of stuff.

00:11:30.000 --> 00:11:35.000
So, as you see on the dates here, or you can't see unless you turn around.

00:11:35.000 --> 00:11:43.000
Um, March 1st, 2026 is what they're considering their new Phase 1 50% PV capacity date.

00:11:43.000 --> 00:11:48.000
And Phase 2 is what they're calling for March 15th, 2027.

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Or, sorry, did I say March 1st? March 1st, 2026 was when it was planned to be.

00:11:52.000 --> 00:12:00.000
And they moved that to January 1st, 2027. Followed on two months later by full capacity of the plant.

00:12:00.000 --> 00:12:06.000
As I say here, I got some description that already spoke to it about the excused delay, and there still are some.

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Potential tariff and tax credit risks. I can't quantify those. Who knows what'll happen? And they'll just have to deal with those as they come along.

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Risk exposures to the county. This is what we care about.

00:12:20.000 --> 00:12:28.000
Um. We have an excess of PV, 170 megawatts. The county cannot use 170 megawatts, even.

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When you include the… capacity that will be sunk to the storage, to the battery energy storage, just in more BASS.

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We come pretty darn close in the winter, because the… days or shorter, less PB generation. The battery capacity is the same in the winter.

00:12:47.000 --> 00:12:55.000
So you can sync more of your actual. Percentage of your daytime power to the battery. So we come pretty close in the winter.

00:12:55.000 --> 00:13:02.000
Um, there's still some access during the day. Now, in the summer, when the days get longer, and the.

00:13:02.000 --> 00:13:06.000
And more intense, and your battery fills up, you have excess PV.

00:13:06.000 --> 00:13:12.000
And we don't plan on having excess PV, you know, charging the battery all up front, and then having a big.

00:13:12.000 --> 00:13:19.000
Hunk of BV left over at the end of the day. We plan on making it a little smoother, or whatever the market dynamics, you know, optimize for us.

00:13:19.000 --> 00:13:22.000
However, we still are facing a need to sell some daytime power.

00:13:22.000 --> 00:13:28.000
Um, throughout the year, and mostly during the summer, and. Spring and fall.

00:13:28.000 --> 00:13:34.000
The issue is, um… Potentially, we could have a loss if we.

00:13:34.000 --> 00:13:37.000
The worst case we could do is if we can't sell the power.

00:13:37.000 --> 00:13:42.000
Absolute worst case, in which case we're curtailing the power, which means we tell them.

00:13:42.000 --> 00:13:45.000
Just stop. Don't… don't put any power on the grid for us. We can't take it.

00:13:45.000 --> 00:13:53.000
Um, maximum worst-case impact of that is… in the ballpark of $70 a megawatt hour that we pay to not get power.

00:13:53.000 --> 00:13:58.000
So, just want to be clear there. That's why I put $70 a megawatt hour loss.

00:13:58.000 --> 00:14:06.000
For power that we can't use. That's… not something we want to do. So we're looking at all the different approaches we have to avoid that scenario.

00:14:06.000 --> 00:14:11.000
Uh, that's… but that's still a risk that we're working to… to, uh, mitigate or eliminate.

00:14:11.000 --> 00:14:18.000
Edam pricing uncertainty. So, P&M has elected to join the EDAM, which is the Extended Day Ahead Market.

00:14:18.000 --> 00:14:26.000
It's part of the California ISO, or CAISOs. Market arrangements. We already participate in CAISO's.

00:14:26.000 --> 00:14:31.000
Eim, which is the Energy Imbalance Market, which works on an hourly interval.

00:14:31.000 --> 00:14:40.000
And this EDAM takes it to a. Daily basis. Um, so day out in advance, you go and say, here's my generation, here's my loads.

00:14:40.000 --> 00:14:46.000
They match. I'm balanced. And then you go into the… into the next state.

00:14:46.000 --> 00:14:53.000
That's gonna happen sometime in, uh, late… I think it's October 2027 is when P&M is planning to.

00:14:53.000 --> 00:15:00.000
To turn that on, functionality. We, as a… Transmission customer under P&M's.

00:15:00.000 --> 00:15:06.000
Balancing area. Don't get a choice about entering this. We go along for the ride with PNM.

00:15:06.000 --> 00:15:12.000
We will be a participant. Exactly what role and function we'll have in that is still to be.

00:15:12.000 --> 00:15:20.000
Determined, and we're working with PNM to understand what our role will be, and what services and support we'll need to either do internally.

00:15:20.000 --> 00:15:29.000
Contract out, or that P&M can support as a service. Do we have a, um, an obligation or responsibility to…

00:15:29.000 --> 00:15:35.000
To, uh, send excess power. To, let's say, Kirtland, you know?

00:15:35.000 --> 00:15:44.000
Uh, as part of our arrangement, overall arrangement. How does that affect… in other words, how does entering that market affect, sort of, our current arrangements, I guess, is the question?

00:15:44.000 --> 00:15:51.000
Chair, Board Member Knockley, the… We have an obligation under our scheduling services agreement with.

00:15:51.000 --> 00:15:57.000
Sandia National Laboratory, Kirtland Air Force Base. To schedule their power and their energy resources.

00:15:57.000 --> 00:16:04.000
They have… they independently go through the Western Area Power Administration, otherwise known as WAPA.

00:16:04.000 --> 00:16:08.000
Contract for the bulk of their. Their energy needs.

00:16:08.000 --> 00:16:17.000
We make up the difference of what they need, or if they have excess. So they have, uh, recently engaged in their latest agreement with.

00:16:17.000 --> 00:16:24.000
Through WAPA for the coming calendar, next, I believe it's the next three coming calendar years.

00:16:24.000 --> 00:16:35.000
Um, and we still are engaged with them to do their scheduling services. So when they're short, we can provide them extra power through whatever most economical sources… resources are available.

00:16:35.000 --> 00:16:41.000
Which may well include foxtail Flats.

00:16:41.000 --> 00:16:48.000
Sorry, can you remind us, too, um, are there needs typically, unlike residential, meaning they operate more in the day.

00:16:48.000 --> 00:16:52.000
And could utilize… daytime power.

00:16:52.000 --> 00:17:02.000
More. Is that… Board Member Holnsworth, that's absolutely correct. Their load is typically a daytime industrial-type commercial load, primarily during the five weekdays.

00:17:02.000 --> 00:17:06.000
You'll see it drop during the holidays, and you'll see it drop on the weekends, and you'll see it drop at night.

00:17:06.000 --> 00:17:17.000
So they typically are buying, and they have in the past, bought shaped blocks of power. So, seasonally adjusted, as well as hours of day and weekends.

00:17:17.000 --> 00:17:24.000
Thank you. Ben, when we were looking at Foxtail Flats.

00:17:24.000 --> 00:17:35.000
18 months ago, whenever that was. Uh, you were… Suggesting at that point that about 30 megawatts would go to Sandia and Kirtland.

00:17:35.000 --> 00:17:43.000
Is that still the likely scenario? Sure, Gibson, board members, yes, that is…

00:17:43.000 --> 00:17:49.000
Written into our… Currently draft, 2026 ECA.

00:17:49.000 --> 00:17:54.000
Our electric coordination agreement between. The county and DOE and NSA.

00:17:54.000 --> 00:18:05.000
Um, and that language is in there and in place for them to take a pro-rata share, notionally. 30 megawatts of the PV capacity, and 25.

00:18:05.000 --> 00:18:14.000
Percent of the battery energy storage system as well. Thank you.

00:18:14.000 --> 00:18:23.000
Moving on with risks, Southwest Power Pool. So, I mentioned… I mentioned EDAM, the Extended Day Ahead Market. That's a California ISO thing that's being.

00:18:23.000 --> 00:18:31.000
Uh, joined by PNM, and we're going along with that. There's another regional organization called the Southwest Power Pool.

00:18:31.000 --> 00:18:37.000
Sometimes abbreviated as SPP. Uh, they handle a different geographical area.

00:18:37.000 --> 00:18:45.000
Um, up in Colorado towards Wyoming, where our. Coal-fired Laramie River Station, LRS facility is located.

00:18:45.000 --> 00:18:58.000
And they have elected to join a different regional organization. Called the, uh… so they're forming, uh, what's part of… our power plant up there, LRS, is going to be part of the.

00:18:58.000 --> 00:19:08.000
Spp, RTO, Western Expansion. So they are expanding to include that in their regional transmission organization, which means that, similar to what's happening with.

00:19:08.000 --> 00:19:18.000
Edam, um, they're going to have another system where our power will be scheduled into their regional market the same way, similar to the way we'll be scheduling power into the.

00:19:18.000 --> 00:19:26.000
Extended day, I haven't market through P&M. So we're gonna have to deal with power from two different balancing areas and two different regional transmission organizations.

00:19:26.000 --> 00:19:33.000
So there's a little bit of a… technical risk there, and financial risk about how we're going to handle that. We're working through that right now.

00:19:33.000 --> 00:19:37.000
I'll go into more detail in that when we get to the following slides.

00:19:37.000 --> 00:19:43.000
But that is something that we're working on, and a risk that we're tracking and working to mitigate and eliminate.

00:19:43.000 --> 00:19:52.000
Lap load forecast uncertainty. Lapp stands for the Los Alamos Power Pool. It is the joint.

00:19:52.000 --> 00:19:57.000
Uh, load, electrical load, between the county and the DOE and NSA.

00:19:57.000 --> 00:20:07.000
Los Alamos National Laboratory. That's what that term refers to. There is some uncertainty in that load forecast in the coming near years.

00:20:07.000 --> 00:20:15.000
Primarily arising from the linear accelerator. Lance, um, I couldn't tell you offhand what that stands for.

00:20:15.000 --> 00:20:26.000
I think it's Los Alamos… Neutron Scattering Center. Board Member Knockley is familiar with it more than I have.

00:20:26.000 --> 00:20:36.000
Um, but that… that facility is facing. First of all, they are, I believe they are… they haven't run at full capacity.

00:20:36.000 --> 00:20:41.000
For the past year. Um, full power capacity is typically about 20 megawatts.

00:20:41.000 --> 00:20:46.000
Plus or minus. Um, they've been running it. Maybe 8 to 12, typically.

00:20:46.000 --> 00:20:55.000
Um, so significantly less than we would normally plan on. And given their plan for.

00:20:55.000 --> 00:21:01.000
The, uh, LAMP project. The linear accelerator modernization program.

00:21:01.000 --> 00:21:07.000
I believe that is likely to be the case for the… at least the next coming 4 or 5 years.

00:21:07.000 --> 00:21:12.000
Given the schedule that I've seen for that project. That we're not going to see much load from that.

00:21:12.000 --> 00:21:22.000
So we're trying to factor that into our load forecasts so that we don't… have excess power that we're exposed to market risks on selling that.

00:21:22.000 --> 00:21:35.000
Another uncertainty is LANL computing facilities. Um, that was scheduled to come on in 2027 with a… With a new load, however, and I do believe that may still be at roughly that schedule.

00:21:35.000 --> 00:21:42.000
But my indications are that it may be at a lower power load requirement than was originally forecast.

00:21:42.000 --> 00:21:45.000
So we're looking at that to make sure we get that built in there.

00:21:45.000 --> 00:21:50.000
And then the final piece of the puzzle is, uh, lacon-lion oil electrification.

00:21:50.000 --> 00:21:55.000
Now, I know that electrification goals have maybe been evolving for various reasons.

00:21:55.000 --> 00:22:04.000
Um, so there's some uncertainty there. Um, it seems to be, maybe, at least electrification of vehicles, maybe slowing below what, uh.

00:22:04.000 --> 00:22:17.000
Was projected as little as a year or two ago. We'll try and do our best. We have an electrification study that we recently did for the electric distribution department, and that will be served to help inform.

00:22:17.000 --> 00:22:24.000
Load forecasting for that particular aspect. For the county side, at least. And then I'm gonna rely on Lanl.

00:22:24.000 --> 00:22:30.000
And DOE staff for what they think is going to happen on the… on the DOE side of the power pool.

00:22:30.000 --> 00:22:34.000
Tariffs and tax credits, I already mentioned that once, nothing more to say about there.

00:22:34.000 --> 00:22:44.000
Other than it… who knows what'll happen. Uncertain hydro water flows and pool elevations, we have talked about that at the last, um, meeting I presented to you.

00:22:44.000 --> 00:22:51.000
Uh, or when, uh, Don Wickers was here presenting the status for the Hydro's annual… on his annual update.

00:22:51.000 --> 00:22:54.000
Um, still don't know what the forecasts are going to be.

00:22:54.000 --> 00:23:03.000
Um, as soon as we know, and we… Still don't know what the repair plan is going to be for Elvado, but we're anticipating maybe another couple years before they figure out what they're gonna do there.

00:23:03.000 --> 00:23:08.000
So hopefully the pool elevations will stay where they're at now.

00:23:08.000 --> 00:23:12.000
And uncertain future market loads and prices. And I mention this because.

00:23:12.000 --> 00:23:22.000
Um, we're seeing a lot of volatility in prices. Favorable in some ways, uh, when we last signed for our Mercuria.

00:23:22.000 --> 00:23:27.000
40 megawatt around the clock. Firm power agreement.

00:23:27.000 --> 00:23:32.000
Two years ago, when we… simultaneously, when we did the Foxtail Flats agreement.

00:23:32.000 --> 00:23:43.000
Power was trading in the high $70 range. It has since fallen anywhere for firm around-the-clock power. Again, not.

00:23:43.000 --> 00:23:48.000
Not renewable power. We're likely going to get coal or gas, natural gas units.

00:23:48.000 --> 00:23:55.000
Into the ballpark of $65 to $55 a megawatt hour. So, dramatic change over the past couple years.

00:23:55.000 --> 00:24:04.000
Um, could that change again? Yeah, probably. Possibly. You hear all this stuff about it in the news about, uh, data center loads jumping up.

00:24:04.000 --> 00:24:10.000
Around the country. Haven't seen that in New Mexico yet, but Meta is planning on putting a facility in New Mexico.

00:24:10.000 --> 00:24:18.000
So that could increase. Um, doesn't necessarily affect us, maybe. But only when we buy power.

00:24:18.000 --> 00:24:24.000
So we'll… and there's a big disconnect right now between the cost of new generation resources.

00:24:24.000 --> 00:24:29.000
And buying market power, like I said. $55 to $65 to buy power today.

00:24:29.000 --> 00:24:36.000
You want to go buy a new resource? It's going to cost you $100 to $150 a megawatt hour.

00:24:36.000 --> 00:24:43.000
So, big, big separation there. Been since you brought up Mercuria, this is a good time to… I was going to raise this question anyway.

00:24:43.000 --> 00:24:50.000
Our current contract with Mercuria. Yeah, it goes until the 1st of March.

00:24:50.000 --> 00:24:58.000
2026, based on the original. Uh, first operation date of Foxtail Flats.

00:24:58.000 --> 00:25:06.000
Obviously, they are 8 months, 10 months, who knows? Behind schedule? Are we exploring.

00:25:06.000 --> 00:25:13.000
Extending a deal with Mercuria on… on whatever the appropriate terms would be.

00:25:13.000 --> 00:25:19.000
Or, uh, how are we planning to cover that gap, since we know it's gonna be there?

00:25:19.000 --> 00:25:25.000
Sure, there's some good questions. Yes, we are planning for that. I have reached out to multiple different, uh, energy suppliers to get.

00:25:25.000 --> 00:25:31.000
Indicative pricing at this point, that's where the $65 to $55 megawatt hour range comes from.

00:25:31.000 --> 00:25:38.000
Specifically for that purpose. Starting in March 1st through, say, September-ish, October-ish kind of time frame.

00:25:38.000 --> 00:25:43.000
When we expect to get first test energy deliveries from Foxtail Flats.

00:25:43.000 --> 00:25:49.000
Um, that said. I can't actually act on any of those offers at this time.

00:25:49.000 --> 00:25:55.000
Because we don't have a… ECA that covers that term.

00:25:55.000 --> 00:26:04.000
So… but I do have those numbers in hand, so we can at least compare them as soon as we can roll on it and see what the price is at the time.

00:26:04.000 --> 00:26:08.000
But this'll be a… let's consider a little marker of where we were at today.

00:26:08.000 --> 00:26:16.000
Thank you. So, I mentioned earlier, the cost risk is bounded by the curtailment option, where we.

00:26:16.000 --> 00:26:23.000
Shut down production, don't take any power from the PV. And that comes out to the way this agreement is structured is the cost of energy.

00:26:23.000 --> 00:26:29.000
About $38, plus the potential. Foregone tax… production tax credits.

00:26:29.000 --> 00:26:40.000
Which is roughly $30, I believe. Um… adding up to $68, which I rounded to $70 on the previous slide.

00:26:40.000 --> 00:26:46.000
Generation load modeling, as I mentioned earlier, we work with that annually with DOE.

00:26:46.000 --> 00:26:57.000
Flannel to make sure that we. Come as close as we can. We haven't done a great job in years prior, um, primarily, again, due to Lance and loads that didn't appear on when they were expected.

00:26:57.000 --> 00:27:01.000
Um, we're gonna work on that getting a little closer this year to reality, hopefully.

00:27:01.000 --> 00:27:09.000
Um, and starting sooner. Uses it… uses a calendar year 22 to 24 loads and plan generation, so.

00:27:09.000 --> 00:27:17.000
My, uh… staffer here, Nick Nelson, who is actually the, uh, power systems.

00:27:17.000 --> 00:27:23.000
Supervisor, so your supervisors are real-time operators. Who sit at the desk 24-7.

00:27:23.000 --> 00:27:28.000
He has been, uh, very helpful in helping model out our actual loads.

00:27:28.000 --> 00:27:36.000
And piecing together how our future generation. Fit together with that in order to balance out.

00:27:36.000 --> 00:27:41.000
And identify when and where we need to either buy or sell power.

00:27:41.000 --> 00:27:47.000
To make us balanced. Um, I said here, $70 megawatt hour to buy.

00:27:47.000 --> 00:27:56.000
Market energy, that's what we put in our model, just for the cost estimate. Um, the $65 was… The estimate I had a month ago.

00:27:56.000 --> 00:28:00.000
Um, and by the time I got to, uh, submitting these slides, I got.

00:28:00.000 --> 00:28:09.000
Additional information at $55, so… take that for a grain of salt. It changed a bit over the past week, after I submitted the presentation.

00:28:09.000 --> 00:28:12.000
So here we go. Here's the meat and potatoes of this subject.

00:28:12.000 --> 00:28:20.000
What are we gonna do with the XSPV? Um, this is a roughly… prefer… ordered by preference of what we want to do.

00:28:20.000 --> 00:28:27.000
Um, what we think we can do and the options we have. First one is to… sell Laramie River Station.

00:28:27.000 --> 00:28:31.000
10 megawatts during the day. When we all have plenty of PV.

00:28:31.000 --> 00:28:39.000
And use PD in place of it. Um, we believe that'll be a perfectly viable option, especially with the entrance of.

00:28:39.000 --> 00:28:44.000
Both the, uh, LRS going into SPP, the Southwest Power Pool.

00:28:44.000 --> 00:28:49.000
Regional transmission organization. It presents an opportunity to simply sell the power.

00:28:49.000 --> 00:28:53.000
At the generating site. And then, during the day.

00:28:53.000 --> 00:28:59.000
We can bid it in for the daylight hours when we don't need it, and keep it at night.

00:28:59.000 --> 00:29:05.000
That's certainly a possible option. Um, the exact mechanics of… and cost impacts of how that works.

00:29:05.000 --> 00:29:16.000
Aren't yet characterized, because. Um, they rely on future forecasts of power, which are not known, and it's kind of a complex interaction between buying and selling power and.

00:29:16.000 --> 00:29:21.000
Nodal, what's called vocational. Uh, marginal prices.

00:29:21.000 --> 00:29:24.000
I haven't talked about that in the past, and I don't want to get into it now.

00:29:24.000 --> 00:29:28.000
But we'll get into more detail when we actually have some numbers to show you.

00:29:28.000 --> 00:29:33.000
Down the road. That's first option. Second option is to sell some or all.

00:29:33.000 --> 00:29:41.000
Of the excess PV that we anticipate through some fairly short-term, say, 1-5 year agreement.

00:29:41.000 --> 00:29:52.000
That's what we had planned to do with Mercuria, and that just didn't work out at the time. Um, but those opportunities may still present themselves. In fact, I'm talking right now with a potential off-taker.

00:29:52.000 --> 00:29:57.000
Who's, uh, maybe has some interest in it. So, I do believe there may be some potential for this.

00:29:57.000 --> 00:30:06.000
Um, it'd be a great option for us to sell some power that we don't need, and take the risk away from us, at least for that short term, until our loads increase to where we can use it all.

00:30:06.000 --> 00:30:11.000
Third option is, and Chair Gibson alluded to this in his question, I spoke a little bit to it.

00:30:11.000 --> 00:30:15.000
Third option is to sell more PV to Sandia National Lab, and Air Force Base.

00:30:15.000 --> 00:30:20.000
Uh, based during the day. We are not… they're not on contract to take power from us.

00:30:20.000 --> 00:30:32.000
But if their load grows, they have some plans for, um… a… I believe it's a solar… thermal plant of some kind, uh, for power storage called Asgard.

00:30:32.000 --> 00:30:39.000
Maybe that'll happen, maybe it won't. If it doesn't happen, that presents an opportunity for us to supply the load that that could potentially serve.

00:30:39.000 --> 00:30:48.000
Um, as well as additional purchases, um, during the day and night, if as needed beyond the 30 megawatts that they're signed up for.

00:30:48.000 --> 00:30:55.000
Fourth option is to modify the lentil gas turbine. By modifying it, I mean just the controls so that we can actually have.

00:30:55.000 --> 00:31:06.000
Automatic generator controls onto it that tie into the California. Iso EDAM system that can turn it on automatically without us having to manually.

00:31:06.000 --> 00:31:10.000
Dispatch it. Um, that presents, like I said, PNMs entering EDAM.

00:31:10.000 --> 00:31:16.000
That, again, presents another opportunity for us to. Bid in that generation.

00:31:16.000 --> 00:31:20.000
Basically say, hey, we have this generator, we can run it.

00:31:20.000 --> 00:31:25.000
At this price. And if it gets called upon, then we run it and we sell that power.

00:31:25.000 --> 00:31:37.000
Potentially at a profit. Um, and reduce… and what it does is, normally we run the CGTG to offset behind the meter, the load from Lance.

00:31:37.000 --> 00:31:44.000
That's a conceptual plan that we use for operating it. In this case, we would say, okay, we're going to decouple those two things.

00:31:44.000 --> 00:31:49.000
We'll run it when the market calls for it, and we won't otherwise.

00:31:49.000 --> 00:31:53.000
Therefore, it'll sit idle, and we'll be able to, instead of… if Lance is running at full power.

00:31:53.000 --> 00:31:57.000
We'll be able to send all of our PV to operate it during the day.

00:31:57.000 --> 00:32:04.000
So it's another opportunity for us to sell excess daytime power by avoiding running the CGTG.

00:32:04.000 --> 00:32:12.000
Fifth option is to sell excess PV. Straight into the market through EDAM or another third party.

00:32:12.000 --> 00:32:19.000
There are good… that's definitely an option. Um… like I said, no idea what the cost of that would be at this point.

00:32:19.000 --> 00:32:28.000
Sixth option, sell, uh, get more battery. If we use more… get more battery, we have a mo… we did modeling on this. If we get more battery, we can use more PV during the day.

00:32:28.000 --> 00:32:32.000
Which helps us out in the summer, lowers the excess that we need to sell.

00:32:32.000 --> 00:32:37.000
And in the winter, it allows us actually to use the battery to run through the whole night. Pretty much.

00:32:37.000 --> 00:32:44.000
Match our load in the middle of winter. Um, it's certainly an option, uh…

00:32:44.000 --> 00:32:49.000
Problem there is… is cost. And I'll get into that in the coming slide.

00:32:49.000 --> 00:32:59.000
The last least desirable option is to curtail the PV. For the reasons that I mentioned, the $70 hit on every megawatt hour, we don't take.

00:32:59.000 --> 00:33:08.000
Any questions, feel free to… speak up. So, I'm gonna go into more detail, these are the options right now. Selling LRS daytime.

00:33:08.000 --> 00:33:21.000
I largely actually talked to this on the previous slide, I guess I jumped ahead here. Um… But as I mentioned, LRS joining SPPRTO starting April 2026, um, so that'll be in advance of when.

00:33:21.000 --> 00:33:25.000
Foxil Flats actually comes online, so it'll be available from the get-go.

00:33:25.000 --> 00:33:32.000
It does allow a straightforward sale of LRS power on an hourly basis. So, like I said, we'd sell it during the day, keep it at night.

00:33:32.000 --> 00:33:37.000
And drop down, uh, or actually allow us to sync an extra 10 megawatts of.

00:33:37.000 --> 00:33:43.000
Power from Foxtail Flats during the day. Ben, have you?

00:33:43.000 --> 00:33:54.000
Done any modeling. One form or another, to look at the reliability of that option, because you're talking about shifting more and more of our.

00:33:54.000 --> 00:34:01.000
Resource needs to… Foxtail Flats, which is a brand new resource.

00:34:01.000 --> 00:34:07.000
One that we are not familiar with yet. We don't have operating experience with it.

00:34:07.000 --> 00:34:16.000
Uh, the, uh… Um, if we shift more and more of our load, projected load there.

00:34:16.000 --> 00:34:23.000
And give up our, um… Traditional supplies, shall we say.

00:34:23.000 --> 00:34:32.000
Are we putting ourselves at a reliability risk? Chair Gibson, Board Members, potentially, and…

00:34:32.000 --> 00:34:39.000
Maybe not. Um, the… our entrance into the… these new markets, we entered into the extended.

00:34:39.000 --> 00:34:47.000
Or not extended, the EIM. Um, and then we're going to be entering into EDAM. Those both provide new opportunities on an hourly basis.

00:34:47.000 --> 00:34:58.000
To schedule power. Um, and deal with those… unexpected or intermittent behaviors that you're referring to, which could affect reliability.

00:34:58.000 --> 00:35:04.000
Um, with the EDAM market, you bid in previous… every hour, uh, one day ahead.

00:35:04.000 --> 00:35:10.000
And you say, okay, this is how I'm gonna generate all the power I need to match my load.

00:35:10.000 --> 00:35:16.000
If that doesn't happen, because your PV comes offline, now you're relying on the.

00:35:16.000 --> 00:35:26.000
Eim, the energy imbalance Market, to make up those shortfalls. Or you go and do… same way we do today, we use the real-time market to go make purchases as available.

00:35:26.000 --> 00:35:30.000
Now, the intent behind these new market arrangements is are they.

00:35:30.000 --> 00:35:35.000
Increase the optimization and liquidity of. Power and transmission.

00:35:35.000 --> 00:35:47.000
To connect these different areas. So the expectation is that that will take some of that risk away. How much? I don't have a quantity to throw at it, but that's the general feel, is that.

00:35:47.000 --> 00:35:58.000
It gives us that opportunity. Now, if we know that there's a… we forecast, we're going to have to forecast weather and things like that for Foxtail Flats and forecast the output of the panels. If we know there's a weather event, snow coming up.

00:35:58.000 --> 00:36:09.000
We'll say, okay, we can probably anticipate this. And there are, you know, emerging or existing tools, software tools, which allow you to, you know, hopefully reliably model that sort of thing.

00:36:09.000 --> 00:36:13.000
Um, and there… I do believe they're getting better as time goes by.

00:36:13.000 --> 00:36:22.000
So, given that, if you knew… if you had a reasonable expectation that your panels were going to get a foot of snow and not being producing for, you know, this period of time.

00:36:22.000 --> 00:36:29.000
You can actually build that into your. Day ahead planning, and go find some additional resources.

00:36:29.000 --> 00:36:34.000
Wherever they're available. That's the… that's what you'd have to do. Um…

00:36:34.000 --> 00:36:39.000
And you would call back, oh, I need my LRS back. I'm not selling it for that day.

00:36:39.000 --> 00:36:48.000
During the day. I need it. So we go find additional resources, or EDAM goes and finds additional resources.

00:36:48.000 --> 00:37:02.000
Edam requires us to have enough generation from whatever source. It could be, you know, own generation, it could be bilateral trade, market purchases, it could be real-time. We could even say, okay, we're just gonna go buy it on the real-time market on an hourly basis.

00:37:02.000 --> 00:37:07.000
During that day. You can do that, but you need to have all the generations lined up.

00:37:07.000 --> 00:37:19.000
For which you anticipate your load will be. So the uncertainty comes in when things don't happen. Now, if we know there's going to be a snowstorm, we anticipate we're going to have less power out of that, we're not going to sell as much excess PV for that period of time.

00:37:19.000 --> 00:37:27.000
We're going to say, okay, we're gonna keep LRS, and that'll, you know, deal with the 10 megawatts, at least 10 megawatts of daytime solar that we're not going to get.

00:37:27.000 --> 00:37:32.000
Because there's snow on the panels. It's things like that that we'll have to do.

00:37:32.000 --> 00:37:36.000
Okay, just to clarify, I think you've answered it, but I want to be sure.

00:37:36.000 --> 00:37:41.000
If we… Um, go in the direction of option one.

00:37:41.000 --> 00:37:48.000
We still have the… although we would be planning to sell the daytime power out of LRS.

00:37:48.000 --> 00:38:01.000
But if something changes, we don't have to. We could keep it. Is that correct? It could be structured that way. Generally, it would be more like a pro-rata share. If the plant goes offline, or the capacity goes down because of a weather event or whatever.

00:38:01.000 --> 00:38:11.000
Or, you know, there's a failure. Part of the, you know, you have a… an inverter bank, you know, fails, and you lose one of your… one of your fields.

00:38:11.000 --> 00:38:24.000
They would take their pro-rata share of that outage. As well as us. So we wouldn't be… it's not… we would never set… offer a firm product, where we say, we're guaranteeing to give you 50 megawatts during these hours. We can't offer that.

00:38:24.000 --> 00:38:30.000
This is going to be a unit contingent sale. Where you get what you get.

00:38:30.000 --> 00:38:35.000
But I'm asking about… LRS sale, if we…

00:38:35.000 --> 00:38:42.000
I said, most of the time, sell the daytime power. But then the snowstorm comes along and says, oh boy, we, uh…

00:38:42.000 --> 00:38:46.000
We ought to hold on to that. Can we hold on to that? Yes.

00:38:46.000 --> 00:38:59.000
Okay. It's done every day as its own thing. You can choose to do whatever you want with it. There's a lot of flexibility built in it. Nobody is obligated to bid their generation into those markets.

00:38:59.000 --> 00:39:10.000
You can keep it for yourself as a self-supply. It's… it's a little complicated on how the actual terminology works. You're still bidding in the resource, but then you pull it out at your delivery node.

00:39:10.000 --> 00:39:21.000
The equivalent amount. Thank you. Thank you, Ben. Um, so, worst case scenario, let's say that Foxtail Flats comes online, and.

00:39:21.000 --> 00:39:25.000
We're buying our power from Foxtail Flats and selling the X's, and everything's great.

00:39:25.000 --> 00:39:30.000
Then a hailstorm comes along, and the entire Foxtail Flats is down.

00:39:30.000 --> 00:39:35.000
What do we do then? We have, uh, how do we buy our power? Is that spot market?

00:39:35.000 --> 00:39:50.000
What do we do? We… initially, when first… the first things happened, the… Extended day ahead market, and the… energy imbalanced market will cover those shortages, hopefully, unless there's some crazy event where power's not available.

00:39:50.000 --> 00:39:56.000
In which case, you're scrambling to do whatever you can. Um, longer term, you know, short… you'd go for a short-term sale.

00:39:56.000 --> 00:40:07.000
Um, whatever period you anticipate needing, month, 3 months, whatever. Um, you… The same way we did with Mercury and bought the 40 megawatt around-the-clock deal, we'd go and look for one of those.

00:40:07.000 --> 00:40:13.000
Whatever the price is at the… the best price we can get at that time.

00:40:13.000 --> 00:40:17.000
I wanted to add something to that, uh… Sure. When Ben and I visited the.

00:40:17.000 --> 00:40:24.000
First phase project out there that P&M's enjoying. They have 13 weather stations on site.

00:40:24.000 --> 00:40:30.000
To protect their solar panels from hail, they actually monitor for that.

00:40:30.000 --> 00:40:34.000
Um, and then they have a way to turn the panels straight up and down to.

00:40:34.000 --> 00:40:41.000
Avoid damage. Um, there is a big insurance claims on. Several sites where they have fixed panels.

00:40:41.000 --> 00:40:52.000
Um, and, you know, just trying to recover the cost from that is… they're just not able to, you know, so that's why they put in the protection.

00:40:52.000 --> 00:41:04.000
And I will point out. That… we don't lose… back in the day, you know, we had the biggest single resource was San Juan Generating Station.

00:41:04.000 --> 00:41:09.000
36 megawatts. When that tripped offline, our share of that?

00:41:09.000 --> 00:41:17.000
We had to go buy a power. So this is, you know, a new scaling with a new, more intermittent resource, admittedly.

00:41:17.000 --> 00:41:27.000
Um, put the basic concepts of dealing with these. These unanticipated outages is something that our operators deal with.

00:41:27.000 --> 00:41:31.000
Fairly regularly, and have in the past, and will in the future.

00:41:31.000 --> 00:41:38.000
Just the scaling's a little different.

00:41:38.000 --> 00:41:44.000
Let's see… term sale… I mentioned this, say, anywhere from 10 to 50 megawatts for 1 to 5 years.

00:41:44.000 --> 00:41:52.000
These are just notional. Depends on what somebody wants. Um, the goal would be to sell for not less than a break-even price.

00:41:52.000 --> 00:41:56.000
Preferably a little bit more to make it our… cover our admin overhead.

00:41:56.000 --> 00:42:06.000
Um, like I say, though, market price is $55, or… margins are pretty tight there. Um, this will lower or eliminate the risk near term.

00:42:06.000 --> 00:42:11.000
Of future market price variability for us. For selling that excess power.

00:42:11.000 --> 00:42:16.000
So that's why it's one of our preferred options, the one that we're actively pursuing.

00:42:16.000 --> 00:42:28.000
Third option, more Sandy or Kirtland. Sales, as I mentioned, 30 watt megawatt share, um, and a potential for an increasing amount of that as they go along. Their loads increase.

00:42:28.000 --> 00:42:34.000
Or they don't get some of their behind-the-meter generation that they're planning on.

00:42:34.000 --> 00:42:43.000
And I should say, I can't speak for them, but if, you know, Foxtail Flats turns out to be a good price, um, for the next.

00:42:43.000 --> 00:42:49.000
2 or 3 years, and when they're renegotiating their… are planning on their next buyer purchase agreement.

00:42:49.000 --> 00:42:53.000
We could factor this in, as well as any other resources we have down the road there.

00:42:53.000 --> 00:42:58.000
So, possible opportunity there. Uh, optimize the CGTG.

00:42:58.000 --> 00:43:07.000
I went into detail on this one already, so I don't want to… rehash this, unless somebody has more questions on it.

00:43:07.000 --> 00:43:15.000
Yeah, Ben… How much has the CGTG been running.

00:43:15.000 --> 00:43:22.000
And to offset the lance load in the recent past. Has it been used in that way?

00:43:22.000 --> 00:43:31.000
It hasn't. It's really only been run, um… to, uh, test its availability and make sure that it's operational.

00:43:31.000 --> 00:43:42.000
Um, there was one event, I think, where LRS tripped offline, and uh… And there was some regional with PNM, and they actually requested one of their, uh…

00:43:42.000 --> 00:43:46.000
Yeah, one of their static bar compensators, our static bar compensator was off.

00:43:46.000 --> 00:43:52.000
And they had a capacitor bank or some other ancillary service equipment that was offline as well.

00:43:52.000 --> 00:43:58.000
And they were experiencing some instability in the grid, and they asked us to run the CGTG.

00:43:58.000 --> 00:44:06.000
To, uh, for… provide some voltage support, frequency support, and so we did that. Um, that was only for, like, a few hours, though, I believe.

00:44:06.000 --> 00:44:10.000
Sam, it was a couple days. But other than that, we've only… they've only run it.

00:44:10.000 --> 00:44:13.000
For limited periods, just to make sure it's operational when we need it.

00:44:13.000 --> 00:44:18.000
Okay, that's what I thought. That's a very expensive resource, is it not?

00:44:18.000 --> 00:44:25.000
Uh, the last time I heard a number was on the ballpark of $60 to $65 a megawatt hour all in.

00:44:25.000 --> 00:44:36.000
Including fuel. Which is not that bad by today's standards. I was thinking it was higher. Okay, thank you. It was higher when we had, uh, um… San Juan at, you know.

00:44:36.000 --> 00:44:45.000
30 bucks or something. So, prepare… and, you know, we had good hydro generation at $25, and LRS at $27, you know, you add those up together, we're in the.

00:44:45.000 --> 00:44:54.000
40s or $50 range, so yeah, that's CGT was expensive by comparison. Thank you.

00:44:54.000 --> 00:45:00.000
Sell PV on EDAM. I already went into detail with this. Um, we are planning for the EDAM.

00:45:00.000 --> 00:45:03.000
Because we don't have a choice, it's coming along, we need to be ready for it.

00:45:03.000 --> 00:45:12.000
Um, in fact, I may come to you down the road here, saying, uh, we need to do a, uh, financial, uh, gap analysis on this, so we can get some good numbers.

00:45:12.000 --> 00:45:17.000
That may happen. Well, maybe I'll bring it up right now.

00:45:17.000 --> 00:45:27.000
We've been hearing about EDAM for some while. We've anticipated that it's coming, and now you're telling us, yeah, it's coming for sure.

00:45:27.000 --> 00:45:33.000
And you've even got a date at this point. And it's obviously a big thing in how we…

00:45:33.000 --> 00:45:40.000
Uh, and what the… Electric market is going to be, and how the system is going to work in future years.

00:45:40.000 --> 00:45:47.000
We as a board don't have a whole lot of… information about how EDAM really works.

00:45:47.000 --> 00:45:53.000
Um, I… I would think it would be helpful to the board.

00:45:53.000 --> 00:45:56.000
If we could get a tutorial or briefing at some point.

00:45:56.000 --> 00:46:05.000
And a discussion… allow some discussion. To help us understand EDAM before we have to make too many decisions.

00:46:05.000 --> 00:46:15.000
That involve it, and I assume this Southwest market that you're talking about probably works somewhat, in a somewhat similar way.

00:46:15.000 --> 00:46:20.000
Uh, so I think we're not very well equipped at this point.

00:46:20.000 --> 00:46:30.000
To, um, evaluate and think about EDAM-type things very well. And I think that could be helped.

00:46:30.000 --> 00:46:35.000
I'm getting some head nods. Yeah, no, that would be nice, that would be good.

00:46:35.000 --> 00:46:49.000
How many states are participating in this KISO EDAM market? Probably a large number, I would think, in the western states. I don't have a number handy. Philo, do you get anything out of the UAMPS meeting? I was at the APPA conference in June, and…

00:46:49.000 --> 00:46:56.000
It's pretty much all across the country. Oh, really? Yeah, yeah. It's a natural, basically.

00:46:56.000 --> 00:47:09.000
Well, within the western region, south… western South Virginia, we're the western area grid, but they… you know, it crosses into the eastern area grid as well, so…

00:47:09.000 --> 00:47:17.000
There are some notable… parties that are electing to choose the other option with SBB, so…

00:47:17.000 --> 00:47:23.000
Competing approach, which is called Markets Plus. El Paso Electric, for example, and I.

00:47:23.000 --> 00:47:28.000
I believe SRP. Srp is joining them, as well as, like I said, it, uh.

00:47:28.000 --> 00:47:36.000
In Colorado and in Wyoming, so… Yeah. So, it's kind of…

00:47:36.000 --> 00:47:55.000
A smorgasbord mix, mixed, checkerboard of who's what right now. Can I prom… I can't promise anything about whether that'll consolidate. I don't know if this will be a beta versus, you know, uh, Betamax versus VHS, I don't know. You're not gonna fix our electric situation in this country? Come on.

00:47:55.000 --> 00:47:59.000
But yeah, um, as far as getting a better understanding at EDAM, yeah, I will, uh.

00:47:59.000 --> 00:48:08.000
We'll work to schedule up something that we can give you some more information about that, so you can be informed on it as we move forward.

00:48:08.000 --> 00:48:12.000
Philo can handle that and schedule a meeting, tell me when it is.

00:48:12.000 --> 00:48:18.000
We'll put it on the agenda. Sub-agenda.

00:48:18.000 --> 00:48:24.000
Oh, pretty soon, I think. It can't be too soon, though. However, we can give you a general.

00:48:24.000 --> 00:48:34.000
Understanding of how EDAM works, but as far as, you know, understanding how it impacts the county specifically, that'll take a little more time while PNM is still figuring out how they're going to do it.

00:48:34.000 --> 00:48:38.000
And how… what their expectations for the interface between us and them will be.

00:48:38.000 --> 00:48:45.000
They're still working on that. Yeah, the first step is understanding how EDAMs work in general.

00:48:45.000 --> 00:48:53.000
Option 6, get more battery. Um, here's some numbers. We ran a bunch of different, uh, size calculations and said, what can we do if we ran, you know, an extra…

00:48:53.000 --> 00:49:01.000
10, 20, 40, 100 megawatts of, uh. And a 4-hour battery, so multiply that by 4 to get the energy capacity.

00:49:01.000 --> 00:49:07.000
Of energy storage. What does it look like? Um, for our load and generation profiles.

00:49:07.000 --> 00:49:12.000
Uh, turns out that 20 megawatts, uh, 80 megawatt hours is.

00:49:12.000 --> 00:49:27.000
Probably optimal for what we know now. Um, throwing in a number at $12.50 a kilowatt month, battery prices have fallen, uh, since we contracted. I don't know exactly how much. I tried to get some numbers, but the best, I guess, had come up with.

00:49:27.000 --> 00:49:32.000
12 and a half. Um, looking at that. And I picked 12 and a half roughly, because.

00:49:32.000 --> 00:49:36.000
It's a good number, and if you add 20 megawatts at 12 and a half.

00:49:36.000 --> 00:49:41.000
Dollars per kilowatt month, it comes out to a nice, even $3 million a year. Easy number to work with.

00:49:41.000 --> 00:49:47.000
So that's why I picked that. It does lower the cost risk of curtailment, meaning.

00:49:47.000 --> 00:49:50.000
By being able to charge the battery with some of that PV.

00:49:50.000 --> 00:49:58.000
We eliminate the risk of having to curtail that power. Um, but it only does it by one. It saves you about one and a half million dollars.

00:49:58.000 --> 00:50:06.000
Of risk or cost exposure. So that's where I get the last bullet. Benefit-to-cost ratio of 0.5.

00:50:06.000 --> 00:50:11.000
Meaning the cost outweighs the benefit. Generally, anything less than 1 is considered not, uh.

00:50:11.000 --> 00:50:27.000
Something you necessarily want to go for. So, I don't see this as a… food option. So is the… so help me understand the reason for that. I'm making a story up in my head, and it goes like this. Oh, we're gonna produce a lot of energy during the day, so a lot of excess that we have to store.

00:50:27.000 --> 00:50:32.000
But we're just not going to use as much of it at night as would benefit, you know.

00:50:32.000 --> 00:50:41.000
That kind of energy, right? We still have a lot of energy just sitting in the battery. Is that basically the reason why we don't… It's… it's cost.

00:50:41.000 --> 00:50:47.000
The batteries are expensive. It's basically just the cost of that. It comes out to cost. If you look at the cost of a battery.

00:50:47.000 --> 00:50:53.000
Um, I don't have a calculation for $12.50 per kilowatt month, but at the price we're paying, which is 13.5 kilowatt a month.

00:50:53.000 --> 00:50:58.000
It works out to an equivalent cost just to have the battery.

00:50:58.000 --> 00:51:04.000
Of about 111, $112 added. To the cost of the power to charge it.

00:51:04.000 --> 00:51:10.000
Per megawatt hour. Oh, wow. Yeah, okay, so a good go by, if you want a 10 megawatt hour.

00:51:10.000 --> 00:51:17.000
Utility scale battery, it's going to cost you $2 million just for batteries.

00:51:17.000 --> 00:51:24.000
But I think those prices… it's an interesting… price time. Right now, they've dropped by about 70% over the last 3 years.

00:51:24.000 --> 00:51:31.000
I think, right? Batteries are… the price of batteries are… I'm talking about is current prices, so the 320 megawatt hours.

00:51:31.000 --> 00:51:38.000
Would be, um… what, 600 was the 323? $64 million.

00:51:38.000 --> 00:51:43.000
And Chair Gibson is telling me that. The 320 megawatt hours is…

00:51:43.000 --> 00:51:48.000
Usable, but the sweet spot of lithium is between 20% and 80%.

00:51:48.000 --> 00:51:55.000
That you're gonna cycle. And so that tells me that if we… if you have 320 megawatt hours of usable batteries.

00:51:55.000 --> 00:52:06.000
They actually have 533 megawatt hours of actual batteries. And I don't know what the real story is. I don't know if they have 533 to give us 320, or I don't know if they have 320 and they give us.

00:52:06.000 --> 00:52:12.000
Last, I don't know. That's… they are…

00:52:12.000 --> 00:52:18.000
Under the agreement, the energy storage agreement, they are providing the rated… stated capacities in the agreement.

00:52:18.000 --> 00:52:25.000
The 80 megawatts, 320 megawatt hours of capacity. Full discharge, full charge, every day.

00:52:25.000 --> 00:52:33.000
Whatever they do to… get a system that's capable of doing that reliably, and for the duration of that 20-year.

00:52:33.000 --> 00:52:40.000
Term, that's on them to figure out. I haven't asked those questions about that. Yeah, so that's $100 million worth of batteries.

00:52:40.000 --> 00:52:45.000
Is… and that's just the batteries, that's not the structure around it, and that's not the inverters, that's not anything.

00:52:45.000 --> 00:52:50.000
They're giving us… that's costing about $100 million just for the batteries.

00:52:50.000 --> 00:52:59.000
Could be. Okay. Now, Board Member Hevner, you mentioned cost of batteries coming down?

00:52:59.000 --> 00:53:05.000
That is not been reflected in. Market prices for these systems.

00:53:05.000 --> 00:53:08.000
I don't know why. It could be partly due to tariffs.

00:53:08.000 --> 00:53:20.000
For example, I read an article, again, anecdotal. That, you know, we're talking $13 a kilowatt month in Europe, you can get these for $6 or $7 per kilowatt month.

00:53:20.000 --> 00:53:25.000
I don't know the reason. There's some structural reasons why.

00:53:25.000 --> 00:53:30.000
It has to do just with the U.S. Markets, I presume.

00:53:30.000 --> 00:53:35.000
That's all I can tell you. Any other questions on this?

00:53:35.000 --> 00:53:41.000
All right. So here was, like I said, we tried a bunch of different sizes.

00:53:41.000 --> 00:53:49.000
The first, uh, vertical bar here shows where we're at with the current Foxtail Flats Energy Storage System.

00:53:49.000 --> 00:53:58.000
And what we tried to do here is characterize. Based on our models, how much excess power in one year would we have to.

00:53:58.000 --> 00:54:06.000
Curtail if all we did was curtail the access power. And it could potentially cost us about $8 million a year.

00:54:06.000 --> 00:54:11.000
For that… the cost of that curtailed PAR. If we add increasing amounts of.

00:54:11.000 --> 00:54:20.000
Additional storage to use some of that excess PV. You'll see that the cost exposure, the risk that we have of market sales for our.

00:54:20.000 --> 00:54:29.000
Curtailing drops. But again. Not as much. And then it starts rising again, because we reach a point where you alluded to.

00:54:29.000 --> 00:54:36.000
We run out of PV to charge it in winter. So we have a battery now that we can't charge, unless we charge it from the grid.

00:54:36.000 --> 00:54:41.000
Which is in our operational plan. So, that's where we got the 80 megawatt, right? Kind of in the middle.

00:54:41.000 --> 00:54:48.000
As being optimal. For additional storage.

00:54:48.000 --> 00:54:53.000
Questions? Alright, moving on. Option 7, curtailing PV. Like I said.

00:54:53.000 --> 00:54:58.000
$8 million a year for your energy you don't use. Um.

00:54:58.000 --> 00:55:05.000
The, uh, $5 million a year value is the estimated worst case. That's… did I say $5 million?

00:55:05.000 --> 00:55:10.000
I don't know where that came from. Or maybe a typo.

00:55:10.000 --> 00:55:16.000
You know what that was? Yeah. I think that's just selling all of that.

00:55:16.000 --> 00:55:24.000
Yeah. Okay. I don't know what that was anymore. Um, I think that's a typo. That should be the $6 million that we were seeing.

00:55:24.000 --> 00:55:30.000
Or the $1.5 million of risk avoidance that we saw in the previous slides.

00:55:30.000 --> 00:55:35.000
Implementing any of these options? The previous options, you know.

00:55:35.000 --> 00:55:40.000
Keeping, uh, selling LRS during the day, selling more power to, uh, Sandia Curtin.

00:55:40.000 --> 00:55:46.000
Um, making other arrangements for a term sale, all those lower our cost risk of curtailment.

00:55:46.000 --> 00:55:53.000
With… without the downsides. And the poor cost-to-benefit ratio that we see with additional.

00:55:53.000 --> 00:55:59.000
Pv from a battery system, and curtailment, so… That's why this is the worst case option. Don't want to ever curtail.

00:55:59.000 --> 00:56:08.000
That's what we're looking… all the other options first. Here's an example of the modeling that we've done. This is just one of many that Nick and I have prepared.

00:56:08.000 --> 00:56:17.000
Um, some… Up front, top bullets say what the assumptions were going into this. This is net of…

00:56:17.000 --> 00:56:27.000
The PV share, that 30 megawatt share, that's going to send… Cindy or Kirtland. So we take that out, and it takes out the battery share that they got as well.

00:56:27.000 --> 00:56:37.000
So we take that out of this calculation here. It includes a… what I talked about, um, I didn't actually mention it, but I'll mention it now, is, uh, we're looking at the potential of.

00:56:37.000 --> 00:56:44.000
Shifting when we run the CGTG, uh, away from just being aligned with when Lance operations occur.

00:56:44.000 --> 00:56:48.000
To when it actually suits the entire pool load and generation profiles better.

00:56:48.000 --> 00:56:55.000
So we can use it to help support when we need it the most, and not run it when we don't want it.

00:56:55.000 --> 00:57:00.000
And yet, you know, the National Lab wants to run the unit. They have a sunk cost that they pay.

00:57:00.000 --> 00:57:04.000
Just to have the facility, so it doesn't do them any good to have it not running.

00:57:04.000 --> 00:57:10.000
So, this is a nice way we can get them the runtime that they're seeking to optimize their resource.

00:57:10.000 --> 00:57:20.000
As well as fitting our load and generation profiles. Now, this is a pretty complicated diagram here. You'll see there's 24 columns. This represents one year starting from January through December.

00:57:20.000 --> 00:57:26.000
Um, each of the columns, um. Is… alternates between day and night.

00:57:26.000 --> 00:57:31.000
So, mainly because we have daytime PV, and we have nighttime battery.

00:57:31.000 --> 00:57:39.000
Um, so that's why I broke it up like that. And you can see from the colors that, uh, current generation is the gray bar. That's based on the historical data from the.

00:57:39.000 --> 00:57:46.000
Past, uh, three years. Not including the recent past is 22 through 24.

00:57:46.000 --> 00:57:51.000
Calendar years. It was a fiscal year. Calendars, yes.

00:57:51.000 --> 00:58:01.000
Um, that's what the gray line on the bottom, above the gray bars, above the middle line there, the zero line, represent. The black lines represent when we could anticipate running the combustion turbine.

00:58:01.000 --> 00:58:11.000
Cgtg, um, you'll see that. Run it through the, uh, late… summer, fall, winter, and then stop in February.

00:58:11.000 --> 00:58:15.000
That's so that we don't have excess power during the hydro runoff season.

00:58:15.000 --> 00:58:19.000
Which we typically get. Hydro is, uh, what color is that?

00:58:19.000 --> 00:58:29.000
That's built into current generation, excuse me. Um, is there anything else to say here? The blue line, top there, is, uh, the actual historical load.

00:58:29.000 --> 00:58:33.000
Over the same time frame, from calendar year 22 to 23.

00:58:33.000 --> 00:58:40.000
Versus, no, that was just the last year. Was it 3-year average of the load. And the orange line up there represents.

00:58:40.000 --> 00:58:45.000
What we've seen out of Lance, if you add in Lance over the past couple years, what we've seen out of that.

00:58:45.000 --> 00:58:51.000
And you can see it's, uh… Kind of varies, a little less than 20 megawatts.

00:58:51.000 --> 00:58:55.000
That you would expect it to run if it was at full power.

00:58:55.000 --> 00:59:02.000
Uh, is there anything else I want to say here? Yeah, so there's two solar blocks. You look in the yellow bars.

00:59:02.000 --> 00:59:11.000
And the top piece has a darker, bolder black outline around it, and that represents the… a daytime solar.

00:59:11.000 --> 00:59:15.000
Piece of 50 megawatts if we were to market that off.

00:59:15.000 --> 00:59:22.000
What… if you took that… so you could take that top section of the yellow columns away, and that would show what we have net.

00:59:22.000 --> 00:59:32.000
If we marketed 50 megawatts of it off, just for. Comparison, and to speak to that option I mentioned about making a sale of that excess PBB.

00:59:32.000 --> 00:59:36.000
And that'd be around the clock… that'd be throughout the year.

00:59:36.000 --> 00:59:43.000
Um, the yellow piece below that with the… less bold outline is the excess PV that we.

00:59:43.000 --> 00:59:51.000
Would have, um… or the PV that we'd have available during the day, and any piece of it that is above that blue load line.

00:59:51.000 --> 00:59:58.000
Represents what we would either have to sell. Or, if it's below the line, what we need to buy during the day.

00:59:58.000 --> 01:00:02.000
Likewise for the battery, on the second column, with the night column for each month.

01:00:02.000 --> 01:00:11.000
That shows current generation. Combustion turbine, and the battery being discharged throughout the night. And where we are short or.

01:00:11.000 --> 01:00:16.000
In a few cases in August and September, where we actually have a little extra power.

01:00:16.000 --> 01:00:23.000
Not if you don't include Lance in the… in the… in the load. So, I'll let you look at that for a little while.

01:00:23.000 --> 01:00:30.000
If you have any questions to…

01:00:30.000 --> 01:00:41.000
Ah, right. Um… I'd call it fuchsia, but… Magenta, fuchsia bar at the bottom, below the zero line represents how much PV is going to charge the battery.

01:00:41.000 --> 01:00:50.000
During the day. So, a lot going on here. So, Ben, yeah, this is a very complex plot with a lot of information. Can you tell me at a high level.

01:00:50.000 --> 01:00:59.000
What is this plot telling us? Is this telling us that our generation is well-matched to our low, not well-matched to our load? We need to do something because of this?

01:00:59.000 --> 01:01:05.000
These results, or… or what? It's telling us that at night, we're pretty good through most of the year.

01:01:05.000 --> 01:01:08.000
We're a little late. If you look in March, uh, night.

01:01:08.000 --> 01:01:17.000
And… April night. Kind of short there. The rest of the ones, they're all within, you know, 5 or 10 megawatts, which is pretty easy to handle on a.

01:01:17.000 --> 01:01:20.000
On a market purchase basis, we can deal with that without much trouble.

01:01:20.000 --> 01:01:28.000
Um, March and April are a little trickier. Um, and it all depends on what kind of, uh, runoff we get from a snowpack.

01:01:28.000 --> 01:01:37.000
Could be better some years, could be worse other years. That's areas we're looking at. The rest of it is telling… the message tells us we have too much PV that we need with the.

01:01:37.000 --> 01:01:44.000
With the 170 minus the 30. Going to Cindy or Kirtland.

01:01:44.000 --> 01:01:51.000
And that's why we're looking for ways to… market that… or extra piece of solar.

01:01:51.000 --> 01:01:56.000
If we did sell off the 50 megawatt block. We'd be looking pretty good.

01:01:56.000 --> 01:02:01.000
Here, especially, you know, you look… you look at where the small yellow bar.

01:02:01.000 --> 01:02:05.000
Going without the dark, bold outline lies, and it's pretty close.

01:02:05.000 --> 01:02:10.000
To plus or minus to where you need to be. Again, this is an average.

01:02:10.000 --> 01:02:21.000
Of 3 years of historical data. It's not necessarily a representation of where each future year will be as loads increase, so it's just taking.

01:02:21.000 --> 01:02:25.000
If you looked at it from the recent history, this is where we lay.

01:02:25.000 --> 01:02:33.000
Yes, and… Yeah, there's other averages going on, so…

01:02:33.000 --> 01:02:41.000
But a general sense, this is where we're at. There'll be specific days and specific hours when you're way off.

01:02:41.000 --> 01:02:52.000
That just happens. Weather variations, it's unavoidable, you know, a cold snap, people turn on their resistive heaters, what are you gonna do? You gotta meet the load. And that's where our normal scheduling processes come in for.

01:02:52.000 --> 01:03:01.000
Anticipating daily and hourly loads that we do anyway today.

01:03:01.000 --> 01:03:07.000
Not to any other questions. I will move on. This is a summary sheet, like I said, they're roughly in order.

01:03:07.000 --> 01:03:12.000
This is the same thing, however, it gives the preference, kind of a preference scale from very high to very low.

01:03:12.000 --> 01:03:22.000
Well, uh, we perceive to be the… where we think… which of these options we think are… are preferred. Um, starting with selling LRS and a term sale.

01:03:22.000 --> 01:03:31.000
And send your Kirtland sales being very high to high. Optimizing the CGTG, medium, high, and then going on down from there, down less and less optimal.

01:03:31.000 --> 01:03:39.000
Primarily because they introduce more market risk. If you're going to sell… if you're counting on selling power into this day-ahead market.

01:03:39.000 --> 01:03:44.000
You don't know what the price is gonna be. So there's some price risk associated with that.

01:03:44.000 --> 01:03:53.000
You may get… make some money. You may lose money. Um, hard to characterize that, because that's looking out, you know, 10, 5… 2, 5, 10, 20 years.

01:03:53.000 --> 01:04:02.000
Don't know where that's gonna be, and our load's gonna be changing over those times. Like I said, that's something… a subject for a further, more refined financial analysis.

01:04:02.000 --> 01:04:23.000
Sorry if I missed it, but why is selling LRS limited to 10 megawatts? Because that's all we have of LRS. We have 10 megawatts. That's our total. Yeah, sometimes you only get 9 megawatts because of a… transmission line congestion, but we're hoping that will go away with the regional transmission organization. That's the whole purpose of a RTO, is to.

01:04:23.000 --> 01:04:30.000
Optimize transmission paths so you don't have congestion. Okay. Okay, thanks. And I will point out, um.

01:04:30.000 --> 01:04:38.000
There are also things where, because we have. Contracted rights for transmission lines now to get our LRS power down. There is a…

01:04:38.000 --> 01:04:45.000
Likelihood that we'll actually be able to get a financial benefit from those rights. They call it rollover rights, and congestion pricing.

01:04:45.000 --> 01:04:51.000
There are mechanisms we… part of our future financial analysis, again, but that we believe we can optimize on those transmission pads.

01:04:51.000 --> 01:05:01.000
Um, we don't have the same. Rights anymore to… dedicated, firm transmission on those lines, but we will get a financial benefit when.

01:05:01.000 --> 01:05:14.000
When we sell power into the market and pull it out at our… receipt point. So, we'll get more into that when we talk about, you know, these markets, E to M and Markets Plus.

01:05:14.000 --> 01:05:21.000
I had a question on option 6. I don't know if you can go back to slide 14 easily.

01:05:21.000 --> 01:05:26.000
But I wanted to make sure I understood the assumption. Get more Bess. Sounds great.

01:05:26.000 --> 01:05:36.000
But get more, does that mean we own the resource, or we're leasing the resource? The only way we've been even contemplating it now is if the Foxtail Flats.

01:05:36.000 --> 01:05:41.000
Under that agreement, if they extended the capacity of the facility.

01:05:41.000 --> 01:05:49.000
At Foxtail Flats. Okay. Not tear out the solar panels. No. No, they have plenty of room. They could potentially add more best capacity.

01:05:49.000 --> 01:05:57.000
At a cost. They'd have to do it really fast, though, because they'd have to get all the, you know, the understanding with P&M and the interconnection to make sure that they.

01:05:57.000 --> 01:06:04.000
It's all in… lined up. Um, they haven't got me any prices yet, so I can't even speak to that. But like I said.

01:06:04.000 --> 01:06:15.000
I don't believe that the cost-benefit-to-cost ratio is sufficiently high to merit this as it is. And that's probably the only realistic best in the timeline we need by 25%. Yes, there are other options down the road.

01:06:15.000 --> 01:06:21.000
We're still looking at. All these other longer-duration storage technologies, um…

01:06:21.000 --> 01:06:30.000
You know, waste to hydrogen, um, pumped hydro, uh. Energy Dome, they're still all in play, but none of them are…

01:06:30.000 --> 01:06:45.000
There yet. Yeah. Where we can go buy one. I appreciate their little… it's a little premature to add option 8, you know, really get best, not just pay somebody for best. And I guess… if we're looking at 1-5 year, I mean, as we're looking at, like, 7 years out, maybe…

01:06:45.000 --> 01:06:51.000
Another option of actually having a resource of this, because then that adds a lot of resilience, especially if it's.

01:06:51.000 --> 01:06:59.000
Up here on the hill somewhere. Thanks. So, Ben, is the government still paying 30% of.

01:06:59.000 --> 01:07:06.000
The solar… the bill for Foxtail Flats? They, uh, believe the developer is using, instead of the, uh.

01:07:06.000 --> 01:07:12.000
Investment tax credit, which is the 30% you're referring to. I believe they're going for that production tax credit.

01:07:12.000 --> 01:07:23.000
Which has a different structure. And I don't know how much they're gonna get off of that. There's… It's tiered, depending on what pieces you can hit. And they are eligible for that, they believe, because they have.

01:07:23.000 --> 01:07:36.000
Met the, uh, criteria for substantial construction. Prior to the certain date. Right, and so I guess my real question is, is there a drop-dead date to where after that date.

01:07:36.000 --> 01:07:44.000
They don't get a credit for any new BESS.

01:07:44.000 --> 01:07:51.000
Probably. I'd have to check into that. I think that… I think, like they said, when I asked the question, they said we need to move fast on it.

01:07:51.000 --> 01:07:57.000
Exactly, that's… that's more… if we miss that date, well then, economically, it's a whole other world.

01:07:57.000 --> 01:08:05.000
Yes. Right. That doesn't mean there aren't other options, as Board Member Hevner said, for other storage down the road. Right, sure. Okay, thanks.

01:08:05.000 --> 01:08:12.000
Sorry, so based on your last comment, is that one reason the term sale option seems appealing? Because that gives you.

01:08:12.000 --> 01:08:25.000
This sort of, uh… you know, you can wait out the best. Yes, it takes… it takes the financial risk for market exposure and market risks of selling that power away from us for that term.

01:08:25.000 --> 01:08:32.000
And yet maintain some flexibility down the road, as our loads potentially increase. Cindy or Kirtland's loads potentially increase.

01:08:32.000 --> 01:08:39.000
Battery technology. Or battery technology, and we can sync it at a good, better cost. Right. I can't imagine this future.

01:08:39.000 --> 01:08:54.000
5 or 10 years from now, where energy storage isn't. A lower cost. It just… Seems to me it has to be. There's so much pushing for it.

01:08:54.000 --> 01:09:06.000
All right, I'll skip back ahead to where I was. Uh… are there any last questions on this subject before we move on to the hydro facilities review?

01:09:06.000 --> 01:09:14.000
You know, Ben… Uh, you outlined back in the risk exposure slide.

01:09:14.000 --> 01:09:19.000
A number of load. Uncertainties mostly associated with LANL.

01:09:19.000 --> 01:09:28.000
Um, I mean, our… We could, for the short term, we can predict pretty well what our load, the county load, is going to be.

01:09:28.000 --> 01:09:33.000
Uh, yeah, there's diurnal fluctuations, of course, and there's some… some seasonal variation.

01:09:33.000 --> 01:09:40.000
But, you know, those are, uh, pretty reproducible. The laboratory.

01:09:40.000 --> 01:09:45.000
Loads are… harder to predict.

01:09:45.000 --> 01:09:55.000
When you look out a few years. Uh, and that's… I mean, the… load prediction is one of the big things we're wrestling with.

01:09:55.000 --> 01:10:02.000
As we look at this whole electrical issue. Over the next several decades, what's the load going to be, and when?

01:10:02.000 --> 01:10:08.000
Well, on the county side. The changes are probably going to be gradual enough. We can see them.

01:10:08.000 --> 01:10:12.000
5 years in advance, 10 years in advance, what we're going to need.

01:10:12.000 --> 01:10:20.000
That's not necessarily so true on the laboratory side. And of course, you know, Lance Byte Run and LanceBiteNotRun.

01:10:20.000 --> 01:10:25.000
Uh, you know, that's a… something that can happen on a much shorter basis.

01:10:25.000 --> 01:10:30.000
There's a lot of uncertainty. In the lanel load.

01:10:30.000 --> 01:10:36.000
I don't know what it was… what the environment was in 1985 when the ECA was.

01:10:36.000 --> 01:10:46.000
And its basic concept and structure was developed. But, uh… maybe this wasn't as much of an issue then.

01:10:46.000 --> 01:10:52.000
But we look at the laboratory now, and, you know, they're predicting big increases in their demand.

01:10:52.000 --> 01:11:02.000
For… but they've always predicted big increases in their demand, and rarely met them, because they… They predict getting every program they ever.

01:11:02.000 --> 01:11:07.000
Dreamed of, plus, of course, the last time they predicted it was.

01:11:07.000 --> 01:11:12.000
They were anticipating a lot of electrification. That'll probably happen, but it'll be slower.

01:11:12.000 --> 01:11:18.000
Um, lot of risk on that side. It doesn't appear to me that.

01:11:18.000 --> 01:11:27.000
In the pricing structure for the ECA. That there… that risk.

01:11:27.000 --> 01:11:34.000
Is taken really into account. It seems like. The variations are on their side.

01:11:34.000 --> 01:11:44.000
And the county is taking the risk. Is that a fair interpretation of how the ECA is currently structured?

01:11:44.000 --> 01:11:49.000
Chair Gibson, I have to be careful what I say here and how I word this, so I don't misspeak.

01:11:49.000 --> 01:11:55.000
Um, I would say that is… a…

01:11:55.000 --> 01:12:04.000
Factual representation of the risks that the county takes upon as the primary.

01:12:04.000 --> 01:12:12.000
Owner of the power supply agreements. That is absolutely correct. Um, and that a lot of the majority of the load.

01:12:12.000 --> 01:12:19.000
Forecasting variations are on the… laboratory side. So I agree with those basic facts.

01:12:19.000 --> 01:12:27.000
As far as the ECA goes. Where it is now, and where we are going to be in the future. There are some proposed changes.

01:12:27.000 --> 01:12:38.000
Again, I can't speak to it, because, um. I don't want to, uh… break the, uh, DOE's procurement rules about disclosure of information.

01:12:38.000 --> 01:12:43.000
Don't know what I can say about that, but we are looking to.

01:12:43.000 --> 01:12:48.000
Provide a more equitable. Trade-off between risk and.

01:12:48.000 --> 01:12:55.000
Between the county and the DOE as we go forward. I'm glad to hear that.

01:12:55.000 --> 01:13:00.000
I hope that we see something like that when we finally see the ECA.

01:13:00.000 --> 01:13:05.000
Draft. Right. When we get to the point where we could talk about it, I'll be able to go into more detail. Okay.

01:13:05.000 --> 01:13:21.000
Thank you. Not seeing any other questions. We'll move on to Hydro Facilities Review. This section will be fairly quick. Before you move on, are you looking for some feedback right now on these option preferences?

01:13:21.000 --> 01:13:26.000
I'll take whatever you have to give me. Happy to eat. Listen.

01:13:26.000 --> 01:13:33.000
Well, I don't want to put the board on the spot. If it's, uh, uh… not useful to you at this point.

01:13:33.000 --> 01:13:39.000
Everything for… there's a lot of things going on, a lot of moving pieces, and I try to roll them all together in here. That's why I've mentioned.

01:13:39.000 --> 01:13:45.000
That's why I gave you all the options we're looking at, that's why we're talking about all the different battery storage, you know.

01:13:45.000 --> 01:13:53.000
Storage long-duration storage technology, it's all in there. Okay, and that's why we did the summary page, just so we could…

01:13:53.000 --> 01:14:03.000
Circle a few, or X out a few. Yeah, well, it kind of looked that way, and so before we moved on, I thought, uh, maybe you'd be looking for some comment from the board, so I will… Please.

01:14:03.000 --> 01:14:12.000
See if anyone wants to comment. And don't all jump at once.

01:14:12.000 --> 01:14:24.000
Where's the option for building a nuclear reactor up here? That's still in the play. All these other resources are still in play. Like I said, this is purely focused on Foxtail Flats and the peace on the Hydros.

01:14:24.000 --> 01:14:33.000
We're still looking at geothermal, still looking at, uh… You know, even though I don't want to say it, gas resources or other things like that, or hydrogen resources.

01:14:33.000 --> 01:14:38.000
We're still looking at nuclear if something materializes that we can actually get our hands on.

01:14:38.000 --> 01:14:47.000
Is cost-effective. This is only for 20 years. Most of those things are out approximately that far, if not further.

01:14:47.000 --> 01:14:52.000
The right things progress. Okay.

01:14:52.000 --> 01:14:58.000
So what of these options could you just… do, anyway, right?

01:14:58.000 --> 01:15:05.000
I mean, like, you don't need our… do you need our approval to do some things, or are you just gonna do sensible things when they… when they emerge?

01:15:05.000 --> 01:15:09.000
The sensible things… Option one.

01:15:09.000 --> 01:15:14.000
3, 4… 5 require no.

01:15:14.000 --> 01:15:22.000
No board action. That's something we can do operationally. Do those things.

01:15:22.000 --> 01:15:28.000
What else… so, so 1, 3, 4, 5, so what… then what do you want, um, views on?

01:15:28.000 --> 01:15:37.000
Um… The others? Two is a matter of opportunity. If we can find a term sale, like I said, 1 to 5 years, 10 to 50 megawatts.

01:15:37.000 --> 01:15:45.000
We'll bring that to you and say, hey. Should we do this? Man, would it be… would it be more accurate just to call these scenarios.

01:15:45.000 --> 01:15:56.000
They're not really options, they're just scenarios, right? They… there are scenarios, but they're not mutually exclusive, and if we get one scenario, for example, option 2, scenario 2.

01:15:56.000 --> 01:16:00.000
Then we may not need to do. Scenario 5.

01:16:00.000 --> 01:16:08.000
For example. Sorry, question. Number three, why is that only high, not very high?

01:16:08.000 --> 01:16:14.000
What's the drawback there? That's because that's dependent on. The need for Cindy or Kirtland.

01:16:14.000 --> 01:16:27.000
For the additional part. Okay, so, when you give your preference, it's also factoring in, sort of, probability? Yeah, it's kind of likelihood of things. Where I think these all fit together? Yeah, this is one I know I can pursue, and it'll… I can make this happen.

01:16:27.000 --> 01:16:37.000
Without much effort. It seems almost like it'd be more likely than the term sale, no? Well, I gotta… I gotta lean on a term sale right now. Okay, so you're feeling good about this. Affective blow-up.

01:16:37.000 --> 01:16:47.000
So today, uh, term sales option two. It could change to be option 3.

01:16:47.000 --> 01:16:56.000
In a week. This is a major long-term strategy. Almost philosophy thing.

01:16:56.000 --> 01:17:04.000
And I don't think it's fair to put that entirely on the back of the staff, just what they can do, so I think, uh.

01:17:04.000 --> 01:17:09.000
We… We are obligated to be.

01:17:09.000 --> 01:17:15.000
Involved here. Um… And for my own…

01:17:15.000 --> 01:17:20.000
Opinion at this point. I think you've done a good job of.

01:17:20.000 --> 01:17:29.000
Prior… of prioritizing isn't quite the right term, but maybe so. Anyway, listing the options more or less in order of preference, or at least.

01:17:29.000 --> 01:17:34.000
I could more… more or less agree with him. Obviously, 1, 2, 3.

01:17:34.000 --> 01:17:46.000
Are, uh, something more desirable than. 6 or 7, uh, you know, trying to pick between 3 and 4 if we had to do that, well, that's a little bit finer grain, but…

01:17:46.000 --> 01:17:54.000
In terms of the overall ranking that you've given here, it seems to me, from what we've seen so far.

01:17:54.000 --> 01:18:01.000
When we don't understand EDAM very well. Uh… Yeah, I think you've done a pretty good job of, uh.

01:18:01.000 --> 01:18:15.000
Of listing, uh, listing them in order of preference. Um, the, uh, I know you'd like to down-select a few of them, and I would… if we needed to do that tonight, I'd start from the bottom and.

01:18:15.000 --> 01:18:18.000
And work my way up. I don't know if I'd down-select.

01:18:18.000 --> 01:18:26.000
5 out of the 7, but uh… anyway, I think the first ones, the first several that you have listed there are.

01:18:26.000 --> 01:18:31.000
Certainly preferable to the ones further down on the list. Um.

01:18:31.000 --> 01:18:37.000
Selling PV through EDAM. Again, I just… I don't understand that one enough.

01:18:37.000 --> 01:18:44.000
But, uh, um… Anyway, that's… that's one… one board member's opinion.

01:18:44.000 --> 01:18:49.000
Well, although you do point out this is a snapshot in time, right? So in 5 years.

01:18:49.000 --> 01:18:55.000
Number 6 may be moved up to number 1, right? So, I don't… I wouldn't necessarily.

01:18:55.000 --> 01:19:03.000
Remove anything from the table. Um, just because we want to keep everything on the table going forward.

01:19:03.000 --> 01:19:07.000
Right? At this moment, this is the proper order, it seems.

01:19:07.000 --> 01:19:13.000
How I would put it. Yeah, and… and he's keeping, you know, he's talking about.

01:19:13.000 --> 01:19:22.000
Term sales of maybe 1 to 5 years. That keeps options open. Exactly. You know, we… we're anticipating our load's going to increase.

01:19:22.000 --> 01:19:32.000
The lab, probably, but we don't really know. Uh, but, you know, in 5 or 10 years, we're probably… we're gonna need more power, and then things are going to look different.

01:19:32.000 --> 01:19:39.000
That too, yeah. Thank you for your input. Appreciate it. Any other comments from the board?

01:19:39.000 --> 01:19:51.000
Agreement that I think this… this is really complex. Thanks for presenting it at a high level. There's lots of details, of course, but I think I agree with the assessment on the preferences or the ranking.

01:19:51.000 --> 01:19:54.000
Thank you for your patience. This took a while to get through.

01:19:54.000 --> 01:20:00.000
Thank you for doing it. We… it's, uh, useful to do things like this.

01:20:00.000 --> 01:20:04.000
All right, let's go back to the presentation, and we'll get to the hydro section.

01:20:04.000 --> 01:20:11.000
That's only a couple of slides, I think. So, problems?

01:20:11.000 --> 01:20:17.000
Let's see… my clicker's not doing anything. There we go. Okay.

01:20:17.000 --> 01:20:24.000
I'm not gonna go over the details here, um… This is looking at the past three fiscal years for.

01:20:24.000 --> 01:20:31.000
Both of the hydro facilities, separately and combined, showing the three classes of, uh.

01:20:31.000 --> 01:20:40.000
Expenses, labor and benefits, non-labor expenses, and for AbiQ, debt service. There's no debt service for Elvado, so that one just has labor and benefits and non-labor.

01:20:40.000 --> 01:20:45.000
If you look at it over the past… Three years, and the final.

01:20:45.000 --> 01:20:52.000
Left-hand column is the average of those three fiscal years. In the middle, between those two.

01:20:52.000 --> 01:20:55.000
Big Abraqueue and elvado sections with the… with the line there.

01:20:55.000 --> 01:21:02.000
Uh, is the Abacu Generation. Total megawatt hours for each of those fiscal years.

01:21:02.000 --> 01:21:08.000
Um, and you can see that it has… dropped significantly in FY2025.

01:21:08.000 --> 01:21:18.000
From the two prior years. And you can see the energy cost, dollars per megawatt hour. You just take those total costs for the fiscal year, divide it by…

01:21:18.000 --> 01:21:21.000
Total megawatt hours for that year, and you get a dollar amount.

01:21:21.000 --> 01:21:31.000
Um, start at 3328, went up to $59 for the past fiscal year, with an average over the 3 years of $38.31 per.

01:21:31.000 --> 01:21:36.000
Megawatt hour. For Evato, get down to the bottom of the screen there, you see Elvado?

01:21:36.000 --> 01:21:43.000
The generation and the… uh, is significantly lower than…

01:21:43.000 --> 01:21:50.000
Abbecue, primarily because of the repair work to the dam face that was occurring during that time period.

01:21:50.000 --> 01:21:57.000
It has since climbed up in FY2025 with the. Limited amount of water.

01:21:57.000 --> 01:22:03.000
That's flowing, primarily on the weekends, that number is still relatively small.

01:22:03.000 --> 01:22:13.000
But bigger than it was the prior two years. And you can look at the total cost there per unit of energy is average of $717 per megawatt hour.

01:22:13.000 --> 01:22:19.000
Which seems high, and it is, but that's considering there was almost no generation for 2 plus years.

01:22:19.000 --> 01:22:30.000
And minimal generation for the past year. Combined, what we really want to do is combine those two to say, okay, we have two facilities, what's the total cost for both facilities combined?

01:22:30.000 --> 01:22:35.000
And that's what the last two bottom rows show. Combined generation and the combined unit.

01:22:35.000 --> 01:22:39.000
Not unit cost, I guess it is unit cost per megawatt hour.

01:22:39.000 --> 01:22:45.000
Uh, again, higher in FY2025 due to low production at both facilities.

01:22:45.000 --> 01:22:59.000
With, uh, 3-year average of $63.11. Just a detailed question. Does this include the transmission costs? Because we bear all that as well, right? Is that built into this? This is all expenses. This is everything, okay.

01:22:59.000 --> 01:23:09.000
Capital projects, labor, benefits… transmission, anything that's a pool expense under these approved resources.

01:23:09.000 --> 01:23:15.000
Is included in here.

01:23:15.000 --> 01:23:25.000
Any questions?

01:23:25.000 --> 01:23:30.000
All right, we'll move on. For context, I put in the…

01:23:30.000 --> 01:23:37.000
Historical generation from both of the facilities over the past… 15 calendar years.

01:23:37.000 --> 01:23:48.000
I apologize for the fiscal calendar year. Difference, but that's how I had the data, and… That's how it came out here. So you could see it. Um, you can see back in the…

01:23:48.000 --> 01:23:54.000
You know, 2010 plus area, region, uh, Elvado was doing pretty good. It almost matched.

01:23:54.000 --> 01:24:01.000
Have a queue. And then, uh, we did the, uh, generated rewind project, and that took it off for a while there.

01:24:01.000 --> 01:24:04.000
That's when things dropped off and went to zero for a few years.

01:24:04.000 --> 01:24:11.000
And then it came back pretty strong. Another 18,000 megawatts, I'm not sure what happened in 2018, why that one was so low.

01:24:11.000 --> 01:24:22.000
That… well, I don't know what that was. I think that was a… We had to do some repairs from the rewind, and they had some issues with the shaft seals, I believe. That might be what that is.

01:24:22.000 --> 01:24:28.000
But then it came back with Gusto in 2019, both must have been a good water year. Um, both facilities were.

01:24:28.000 --> 01:24:42.000
Putting out a lot of power, um, and it's… was, uh, Elvado dropped off after that in 21, when the, uh, dam faced repairs started, and they began draining the lake.

01:24:42.000 --> 01:24:55.000
And that gets us to 2024, when it was still… Under repair, and we had no power generation. Looking at AbicQ, you can see there was a big year there in 2023 when it had a lot of water, a lot of snow, um, and then it has…

01:24:55.000 --> 01:25:01.000
Return to a more average amount. In 2024.

01:25:01.000 --> 01:25:07.000
You can edit the subtotals, um, a lot more over the past 15 years out of AbiQ.

01:25:07.000 --> 01:25:15.000
Largely because Elvado didn't have water. For many of the years… some of the years, and it was under major repair for the other years.

01:25:15.000 --> 01:25:22.000
So, just for a little bit of context there, so you can have a feel for how they've done historically.

01:25:22.000 --> 01:25:29.000
So… One thing, if… I'll go back here real quickly, I didn't mention this specifically, but if you look at the…

01:25:29.000 --> 01:25:36.000
Abbecue labor and benefits versus the Elvado labor and benefits. You can see that the Elvado Labor and Benefits is significantly higher.

01:25:36.000 --> 01:25:46.000
Then, Abigail, there's a couple of reasons for that. One is because even though all of the hydro staff work and support both facilities.

01:25:46.000 --> 01:25:56.000
Maybe not equally, but they both work at both facilities, in particular the supervisor supports both facilities roughly equally. However, in 2025, when you see a big.

01:25:56.000 --> 01:26:03.000
Uh, number 454,000 plus for Elvado labor and benefits. That was when.

01:26:03.000 --> 01:26:10.000
The Adam Cooper, the… plant supervisor retired, and he was on pre-retirement leave.

01:26:10.000 --> 01:26:14.000
Going through sick leave, burning off his sick leave, and remaining.

01:26:14.000 --> 01:26:20.000
Uh, annual leave. At the same time, we had an acting supervisor.

01:26:20.000 --> 01:26:25.000
Working on the job, our current supervisor now, Don Wickers, and so we had two people charging.

01:26:25.000 --> 01:26:29.000
All their time. Two supervisors, the highest paid, charging their time to Alvado.

01:26:29.000 --> 01:26:34.000
Um, subsequently to this, or in the future, we're going to.

01:26:34.000 --> 01:26:39.000
Reallocate the supervisor's time to split it more evenly, so you won't see this.

01:26:39.000 --> 01:26:47.000
Uneven split between AbbeyQ and El Auto. And that's what this slide speaks to.

01:26:47.000 --> 01:26:53.000
Next steps. Um, I know we, uh… I've talked about this before, about.

01:26:53.000 --> 01:27:00.000
You know, the hydros and their financial performance. This is just a… initial look at it from a very high level.

01:27:00.000 --> 01:27:07.000
What we plan on doing in the future is looking for cost-saving opportunities, um, determining, you know.

01:27:07.000 --> 01:27:19.000
What systems and subsystems. At Elvado in particular, if the water levels aren't there, or if it goes under another repair, long-term repair project.

01:27:19.000 --> 01:27:27.000
What can we do to minimize costs there? I'm gonna, you know, there are regga… there may be regulatory and safety requirements that we can't avoid.

01:27:27.000 --> 01:27:35.000
We may not be able to entirely mothball the plant, just so to say, um, simply from a safety standpoint, and FERC may not allow it.

01:27:35.000 --> 01:27:40.000
The dam owners may not allow it as part of their public safety plan and their emergency action plans.

01:27:40.000 --> 01:27:47.000
We may need to have some minimal capacity or operational capacity there, just to meet those requirements.

01:27:47.000 --> 01:27:57.000
And so the goal is to have this information. And these net 3 bullets, and whatever else we decide we need, uh, available in time to use for the coming budget cycle.

01:27:57.000 --> 01:28:02.000
So that we can build that in there as best we can.

01:28:02.000 --> 01:28:11.000
Ben, are you anticipating. That the discussion of Elvado and options, if there is one.

01:28:11.000 --> 01:28:19.000
Will occur before the budget? Hearings start? Are you thinking of…

01:28:19.000 --> 01:28:26.000
Incorporating them into the budget hearings. I would say…

01:28:26.000 --> 01:28:38.000
Prior to the hearings themselves. Good. It'll be too late to have it, say, in February or March. Well, this is bigger than just a budget issue.

01:28:38.000 --> 01:28:44.000
And we don't want to get… don't want the… The budget hearings to bog down in this.

01:28:44.000 --> 01:28:49.000
More technical discussion. I would rather have the technical discussions in this.

01:28:49.000 --> 01:28:59.000
The coming remaining months of this year. And they may not get down to the level of, yeah, we can mothball it for this cost, and we're gonna do that. It may be more like, you know, we're gonna eliminate these.

01:28:59.000 --> 01:29:04.000
These services and these functions in order to optimize the cost as much as we can in this time period.

01:29:04.000 --> 01:29:08.000
For the coming fiscal year, and build that into the budget from the get-go.

01:29:08.000 --> 01:29:16.000
Okay. Thank you.

01:29:16.000 --> 01:29:22.000
And that's all I have. If there are any, uh… Further questions?

01:29:22.000 --> 01:29:29.000
I welcome them. Anyone?

01:29:29.000 --> 01:29:43.000
Very much. I know there's a lot that went… went into this, um… And there's a lot that… to still go… to go yet. Thank you for your time and listening.

01:29:43.000 --> 01:29:54.000
Okay… We'll move from that to the annual update on the gas distribution system.

01:29:54.000 --> 01:30:03.000
Clay. Thanks, Chair Gibson, members of the board, that's a hard act to follow.

01:30:03.000 --> 01:30:11.000
You guys make fun of me for long presentations, but… fall short of that this evening.

01:30:11.000 --> 01:30:24.000
All right, so hopefully you don't have quite as many issues for us to think about. This one should go… fairly easily. Um… So yeah, this is our… my annual update, uh, for the gas system.

01:30:24.000 --> 01:30:30.000
Um, I actually do have some changes from previous years. Uh, it was one of the first years that we, in.

01:30:30.000 --> 01:30:40.000
Recent years that we've done. Um, some updates to the gas system, so you'll see that here in a minute. Um, at a glance, you can see our gas system.

01:30:40.000 --> 01:30:48.000
Um, we… it's separated, of course, because of White Rock is not connected to the town site, and they are somewhat different gas systems.

01:30:48.000 --> 01:30:56.000
The, uh, gas system we have in White Rock was, uh, inherited, essentially, from P&M.

01:30:56.000 --> 01:31:04.000
And so it was P&M's gas system that was installed, so it's… it's more of a traditional style of gas system, 60-pound.

01:31:04.000 --> 01:31:13.000
60 psi, um, uniform pressure throughout the system, whereas, uh, Town Site has a 100.

01:31:13.000 --> 01:31:20.000
Psi kind of trunk. Transmission, and we dropped the pressure at all of those red.

01:31:20.000 --> 01:31:30.000
Dots, those are our pressure regulation system, um… stations where we drop it to 20 psi for distribution pressure.

01:31:30.000 --> 01:31:40.000
Uh, we do have 3 border stations in the town site, and that's where we take, uh, delivery of gas from the New Mexico gas, which is a 300-pound system.

01:31:40.000 --> 01:31:50.000
Uh, White Rock has the one border station now. Um, we operated a section of line a few years… just a few years ago.

01:31:50.000 --> 01:32:01.000
To move that border station. We built it, uh, specifically for White Rock, and it's right there near the fire station, so… That kind of helped our reliability and kind of the overall functionality of it.

01:32:01.000 --> 01:32:08.000
Functionality of the White Rock system. Um… Town site, like I said, has a 100 psi trunk.

01:32:08.000 --> 01:32:16.000
And we have… that's about 15 miles of piping, and then the rest of the system's 20 pounds, so that's 97 miles of piping.

01:32:16.000 --> 01:32:21.000
And then White Rock with the 60 PSI system, 26 miles.

01:32:21.000 --> 01:32:27.000
Um, you can see that we, uh, our projects, our primary projects this year were DP Road.

01:32:27.000 --> 01:32:38.000
Very complicated, uh. Project with a lot of difficulties throughout. It's just, um, everything was really…

01:32:38.000 --> 01:32:48.000
It was, like, tentacles, just gas lines going everywhere around old buildings, and… thing, uh, everything down there hadn't really been…

01:32:48.000 --> 01:32:58.000
Managed with zoning, like the rest of the town has, so… It was kind of an ad hoc gas system, and so cleaning it up.

01:32:58.000 --> 01:33:14.000
We really just abandon everything, cleaned it up, and now everything is standardized and much more manageable, so… There's a lot of relief from a lot of us about having this new gas system at DP Road, and everything was upsized all the way down.

01:33:14.000 --> 01:33:20.000
To the bottom to support any development along the south side of DP Road.

01:33:20.000 --> 01:33:33.000
Uh, Court Street was not a planned project, but was, um… was kind of a surprise project that we had to… we had to embark on because we found a gas leak that.

01:33:33.000 --> 01:33:38.000
It had been coming and going. We couldn't pinpoint where we were… where we were detecting gas.

01:33:38.000 --> 01:33:50.000
And finally, it became apparent the gas line was very deep there, so it was distributing in different areas, and it took us a while to really find where it was, but it was right next to a resident's home.

01:33:50.000 --> 01:33:58.000
So, we really made… you know, it was… it was a difficult project because they had to put up with.

01:33:58.000 --> 01:34:04.000
Quite a lot of mess right out of their front door. We had to remove their entire driveway. We were almost in their garage.

01:34:04.000 --> 01:34:09.000
And, um, you know, it was just one of those difficult things. But at the same time.

01:34:09.000 --> 01:34:13.000
Once we found it, we realized that we needed to do.

01:34:13.000 --> 01:34:19.000
A complete overhaul of that section. What had happened is sometime in the 1980s, um.

01:34:19.000 --> 01:34:31.000
They had… they were inserting plastic lines into the original steel line, and they… they… I think what happened was there were a lot of bins to get it through around the homes and through the backyards.

01:34:31.000 --> 01:34:38.000
And it just… they couldn't do it. There were too many bins, so they just transitioned… left that section of steel there, thinking that.

01:34:38.000 --> 01:34:44.000
Sometime in the future, near future, they were gonna do it, and it just never was really documented.

01:34:44.000 --> 01:34:51.000
And so it got forgotten, and that's why we keep good records. And then, of course, we have the third-party project, Elk Ridge.

01:34:51.000 --> 01:35:00.000
We'll talk about that here in a minute. Uh, let's see… our gas sales by sector. We… we do, um…

01:35:00.000 --> 01:35:06.000
Categorize, you know, who all is buying gas from us. You can see that, in general.

01:35:06.000 --> 01:35:12.000
Gas sales have been down. They've been trending down. Of course, last year was a warm year.

01:35:12.000 --> 01:35:28.000
So, you know, we're hoping that, generally speaking, people are, um… using more efficient gas appliances and being more gas-wise, but we are adding some customers, especially, like, the Hills.

01:35:28.000 --> 01:35:37.000
Which is a benefit to the gas system and the financial stability of our gas market, because, um.

01:35:37.000 --> 01:35:42.000
It's a lot of customers, but not a lot of use of gas, so that is helpful.

01:35:42.000 --> 01:35:49.000
Um, for us in operations. Uh, DP Road, um…

01:35:49.000 --> 01:35:57.000
So, you can see that we installed a large amount of 4-inch gas line, and that was really to replace everything that was on DP Road.

01:35:57.000 --> 01:36:12.000
And it… it helps to serve in terms of, uh. It's good for the condition of the gas system and capacity to serve. Then we had some 2-inch gas, and then, of course, a lot of 1-inch gasoline… gas services.

01:36:12.000 --> 01:36:26.000
We abandoned a lot of… a very hodgepodge of gas. We didn't have any leaks. There was good integrity with it. It was just… it was very hard to manage because it was chaotic.

01:36:26.000 --> 01:36:37.000
Court Street, the isolated steel section I was talking about. Uh, once we… identified what the problem was. We had to trace down where all that.

01:36:37.000 --> 01:36:42.000
Old, isolated steel section went, and the more we did it, the more we realized.

01:36:42.000 --> 01:36:51.000
We needed to bring it out into the street and courts and pine, and… then at some point, we had to reconnect what was there.

01:36:51.000 --> 01:36:57.000
So when we did that, we realized that. The project wasn't meant to be.

01:36:57.000 --> 01:37:02.000
What they had done wasn't meant to be permanent, because they kind of had some temporary fittings.

01:37:02.000 --> 01:37:07.000
And once we found that, we realized we needed to replace the whole thing, so we scrambled.

01:37:07.000 --> 01:37:16.000
Uh, with the engineering, uh, division. To get this done, and it was… it was difficult because it was right after it had snowed.

01:37:16.000 --> 01:37:24.000
In early November. Um, last… about a year ago, so it was right after I had given my update to you.

01:37:24.000 --> 01:37:31.000
And, uh, so then the project… took on this whole life as if it was a capital project during the winter.

01:37:31.000 --> 01:37:44.000
So it was kind of difficult. And then… and it's only been… It seems like it's gone on until quite recently that we've just finally gotten everything cleaned up from it. But we abandoned a large piece of.

01:37:44.000 --> 01:37:53.000
Isolated steel, which was a relief. Yeah. Uh, service lines are customer-owned, right? Uh, no.

01:37:53.000 --> 01:37:58.000
Um, when I say service, it is a delivery line on our side.

01:37:58.000 --> 01:38:06.000
Essentially, we, the gas operator, we own the system all the way to the customer. You own it to the meter? Yes.

01:38:06.000 --> 01:38:12.000
And then the customer takes it over from the meter. Yeah. I mean, okay, that's why I asked the question, because I'm used to the word service.

01:38:12.000 --> 01:38:20.000
Being from the point of delivery downstream, which would be customer-owned. Right. Yeah, they kind of get loosely.

01:38:20.000 --> 01:38:48.000
Interchange, but we call it a service as opposed to the larger distribution line, yeah. But it is… it is how we deliver gas, but in… in the… in the case with gas, it's just a category of line usually means it's a smaller line that came… that branches off of the main. Another way of saying it, it's a tap off the main line. Exactly. To the gas… Yeah, so… Once it gets to the customer meter, that's where their regulator drops the pressure, and then that.

01:38:48.000 --> 01:38:54.000
Is a completely different, uh, jurisdiction that oversees… And that's what I was… because of your story about.

01:38:54.000 --> 01:39:08.000
Court Street, and almost getting in the guy's garage. That made me start thinking that, well, maybe because of the work that you did, you had to actually go and do stuff on their side of the meter to make things right. Uh, well, eventually we did have to have that.

01:39:08.000 --> 01:39:19.000
That part done, too. Although their gas is… the resident's gas system had good integrity. They… luckily, but we were… we were sensing gas in one of their walls.

01:39:19.000 --> 01:39:25.000
So we knew it… and we checked everything inside their house, you know, because we do have, uh.

01:39:25.000 --> 01:39:31.000
Certified gas fitters, so they're a good, you know, gas mechanical plumbers, too. So they went in there.

01:39:31.000 --> 01:39:36.000
Did a check, and so we realized this must be coming off of our gas system.

01:39:36.000 --> 01:39:48.000
Somewhere in their front yard, and traveling. Into their house. So then we realized we had a big… we had a big problem, but it was hard to pinpoint where that was until we really…

01:39:48.000 --> 01:39:55.000
Just started tearing their… poor area up, and we had to really work with them to get it back, and…

01:39:55.000 --> 01:40:00.000
Um, we did have some help from Public Works with their, um, on-call.

01:40:00.000 --> 01:40:15.000
Concrete contractor, and so they did a good job. But we, you know, it was hard because… It wasn't just their landscaping, it was several neighbors' landscaping, and so it's taken some work to get that back. You know, people went there.

01:40:15.000 --> 01:40:35.000
Their live… their lives return to normal, and, you know, over time, we… things sink after the rain, and we had to go back out during the summer and fix it. So, um, we were playing landscapers as well all summer when this would… we'd get a phone call from a resident, my grass is sinking. And then all of a sudden, we're out there.

01:40:35.000 --> 01:40:51.000
Scooping up grass. I even helped out because it was somebody I knew who called me directly, and I'm gonna call your mom if you don't get an answer. So I, you know, and so I was like, I'll be over there, we'll do it this afternoon. Yeah, so it was kind of funny.

01:40:51.000 --> 01:40:57.000
But that's how it is in a town where you know everyone. Um, our O&M report here, uh.

01:40:57.000 --> 01:41:01.000
These are just pieces of data, you know, things that we do.

01:41:01.000 --> 01:41:07.000
Um, you know, we… we have… several, uh, regulated, um.

01:41:07.000 --> 01:41:14.000
Tasks from the PRC, which… which is really un… you know, it's… it's a federal law that gets.

01:41:14.000 --> 01:41:24.000
Handed to the state to oversee, and unfortunately, with the government shutdown… no, no, it's fortunate that it still occurs, even though we have a government shutdown, we still have to.

01:41:24.000 --> 01:41:40.000
Be responsible and follow all the rules. But, um… So, over the years, because all of our guys get shifted around from one thing to another, you know, the guy's working on the gas will suddenly respond to a sewer issue, or a water line break.

01:41:40.000 --> 01:41:47.000
Um, a few years ago, if you remember, we said, nope, we're… we're getting behind in all of our, uh.

01:41:47.000 --> 01:41:53.000
Regulated, uh, tasks, so we have a dedicated gas crew and a dedicated supervisor that.

01:41:53.000 --> 01:41:59.000
Maintains records and oversees and makes sure that all of these things are covered on a regular schedule.

01:41:59.000 --> 01:42:07.000
And so, second year in a row. All of these tasks, like continuous surveillance, pipeline patrol.

01:42:07.000 --> 01:42:16.000
And, um, atmospheric corrosion abatement, these are things that. Typically kind of would slide because we were doing something else.

01:42:16.000 --> 01:42:22.000
And we just don't let it slide anymore, and so we have… Uh, full record.

01:42:22.000 --> 01:42:30.000
Of it, and it's easily, um… proven to the PRC when we have audits and things like that. So we've gotten all of those things done.

01:42:30.000 --> 01:42:38.000
We had more gas locates this year because. Of the complicated project out at DP Road.

01:42:38.000 --> 01:42:47.000
Um, you can see what incident response activities. We did repair 10 leaks. It was 9, until we found one last week.

01:42:47.000 --> 01:43:01.000
And I had to tell Kathy I needed to edit it, because we found one, and that happened from… the guys doing their, uh, what we call pipeline patrol and continuous surveillance. They were… they were out there with the leap that…

01:43:01.000 --> 01:43:11.000
Detector, and they were picking something up, they couldn't… They didn't smell it until they were somewhere completely different, but what they did… because they were walking it down.

01:43:11.000 --> 01:43:19.000
Um, one of the gas operators. Caught something, and they started tracing it out, and sure enough.

01:43:19.000 --> 01:43:31.000
You know, they've been taught to look at vegetation and things like that, and they found a big dead spot in this person's yard where they… farther away, so it… the leak had been traveling, but they were able to trace it down.

01:43:31.000 --> 01:43:36.000
And it's only because they were… walking down the entire town that they actually found that.

01:43:36.000 --> 01:43:45.000
Um, they did talk to the resident, and he was like, yeah, every once in a while we would kind of get a little wet, but then it'd go away, and so that's kind of how gas.

01:43:45.000 --> 01:43:54.000
Can dissipate and travel somewhere else. So the… There is a reason why we have to do the pipeline patrol and continuous surveillance.

01:43:54.000 --> 01:43:57.000
Um, we did have some third-party line hits, and mainly those were.

01:43:57.000 --> 01:44:02.000
Um, from the… DP Road project.

01:44:02.000 --> 01:44:14.000
Um, you know, you get a gas contractor out there. Digging around, like I said, those gas lines were… just like spaghetti everywhere, and they would hit it, so our guys would have to go out and.

01:44:14.000 --> 01:44:26.000
And do the repairs. We were pretty much on-site, usually, so the, you know, the… the threat or the risk was low, so they were right there in most cases.

01:44:26.000 --> 01:44:35.000
Um, we had a lot of gas customer call-outs, usually what those are, are… residents in the wintertime, especially, you know, it… they're… that…

01:44:35.000 --> 01:44:40.000
Kind of is about to start up as heating season begins, people start getting their boiler.

01:44:40.000 --> 01:44:47.000
Boiler fired back up, or… or their, uh, heaters, and they'll smell gas.

01:44:47.000 --> 01:44:53.000
And so we typically, all winter long, have a lot of those call-outs, and a lot of them happen in the middle of the night.

01:44:53.000 --> 01:44:59.000
Um, yeah, so we continue to put in more cathodic protection.

01:44:59.000 --> 01:45:13.000
On the steel lines, we're… we're… the guys, like, because they're dedicated to it, they're going around and checking all of the… cathodic protection potential, and if something's low, we install more anodes.

01:45:13.000 --> 01:45:23.000
We're probably getting close to. This piece of the project going down. We're not finding any low readings, but we have to go back and check them, and.

01:45:23.000 --> 01:45:29.000
Old anodes sometimes need to be replaced. Uh, starting last…

01:45:29.000 --> 01:45:35.000
During the wintertime, we began doing… it actually was late last fall, we started doing, um.

01:45:35.000 --> 01:45:44.000
Leak surveys out at Elk Ridge when we identified that the gas lines were underneath several of the homes. So, up until July.

01:45:44.000 --> 01:45:50.000
We were performing those every month. Um, we have continued to replace, uh.

01:45:50.000 --> 01:45:59.000
Meters, both commercial and residential. And these are… give some images, just to give you an idea of.

01:45:59.000 --> 01:46:06.000
How the DP Road project looked. This… this is the clean area when we got down and away from all of the.

01:46:06.000 --> 01:46:11.000
Sort of industrial buildings. It was a real… um, nest.

01:46:11.000 --> 01:46:19.000
Up higher on DP Road, but uh… We did install gas lines down in this area, finally.

01:46:19.000 --> 01:46:27.000
Um, so any development. That occurs down there, they're gonna be able to connect to the gas system.

01:46:27.000 --> 01:46:34.000
Um, so this is just kind of an interesting image, because we had to go through several scenarios.

01:46:34.000 --> 01:46:40.000
Of how we were going to… Abandoned the old gas system and tie back in.

01:46:40.000 --> 01:46:46.000
Uh, to what was there, and it was right here in these people's backyard that we found.

01:46:46.000 --> 01:47:00.000
Some very bizarre, um… transition fittings that you could tell they… they didn't intend for it to be permanent, because they're the type of fittings that would typically… you would only put temporarily.

01:47:00.000 --> 01:47:12.000
And they had been there for quite a long time. So, it was kind of a, um… serendipitous event that… that we found the leak, because then as we went farther down the line.

01:47:12.000 --> 01:47:20.000
We realized that, uh, that… piece had some other related problems, and we were able to mitigate all of that, and then we.

01:47:20.000 --> 01:47:23.000
We did some inspection on the rest of it and found.

01:47:23.000 --> 01:47:30.000
That there was… there were no more pieces of isolated steel or transitions, so we took care of a big problem.

01:47:30.000 --> 01:47:38.000
Chloe, just a question along those lines. So, you found something there that had been placed 40…

01:47:38.000 --> 01:47:45.000
40 years ago, something like that, right? Apparently it was as temporary measure and lasted for 40 years.

01:47:45.000 --> 01:47:52.000
And you probably could… it sounds like you didn't… you couldn't find any documentation of it, there were no records of what the heck was going on. No.

01:47:52.000 --> 01:48:02.000
So, I hope this… the answer to this is an easy yes. Are we doing a better job now, so our successors 20 years from now, when we're all gone on to other things.

01:48:02.000 --> 01:48:11.000
Yeah. And something screws up, they can at least look and say, oh, yeah, they intended to do this, couldn't do this for such and so reason, or whatever.

01:48:11.000 --> 01:48:23.000
Yeah, I've thought about that, like, why we couldn't… I mean, you know, we go through old drawers, and you've… and sometimes you'll find, oh, here's a… really good set of records of this project, and it might be in the…

01:48:23.000 --> 01:48:32.000
In the late 70s, but it's… but it's, um, it's inconsistent, so you'll find a folder, of course, because back then, everybody just… ah, here you go.

01:48:32.000 --> 01:48:39.000
Here's a drawing, and some of them… some of the hand drawings are good, and some of them are very accurate. And then… you'll find something that it's, like.

01:48:39.000 --> 01:48:45.000
Hmm, there is just nothing on that, and we've gone through everything. Every filing cabinet, every archive.

01:48:45.000 --> 01:48:52.000
And… and we were able to piece together most of it and get it entered into the GIS. So when you see.

01:48:52.000 --> 01:49:14.000
These lines here, there's actually a database behind these lines with the GIS, so… so anytime we were able to find something, and this is a good project for interns or somebody who comes in, I even did it when I first started working here. You know, you… You go through old records, and… and you… oh, okay, this segment here was a project, and you place a date.

01:49:14.000 --> 01:49:22.000
Uh, material type. And anything that was in there, and if they had a contractor or whatever, you put that into.

01:49:22.000 --> 01:49:29.000
The record of that area. So we have… we've pieced together, you know, quilt style, but there are still some little gaps.

01:49:29.000 --> 01:49:49.000
And so, we've tightened that down, and I'd say we're down to the last little bit, but every once in a while, you will find a little… skeleton in the closet, and… And so, you know, we talk about the condition assessment amongst our group, and we have a good idea of the condition. We get it into the record when we have it.

01:49:49.000 --> 01:50:00.000
But, like I said, you'll find these things that… It was missing, and we assumed that that was all plastic, and so it was a real surprise to find this rather.

01:50:00.000 --> 01:50:08.000
Lengthy piece of… of… isolated steel that had no cathodic protection, and that's what it was. It was a corrosion pit.

01:50:08.000 --> 01:50:13.000
Right at their driveway, where they would salt. The driveway, and then have a drainage.

01:50:13.000 --> 01:50:25.000
Coming off of it, it was going down, and it was moist all the way down to that… gas line, and there was water down there, and so that's… that's how it happened. We dug around, and.

01:50:25.000 --> 01:50:30.000
Most of it was actually in good shape. It was just that little spot.

01:50:30.000 --> 01:50:34.000
That had that problem. And so, it probably could have sat there another 40 years if it hadn't.

01:50:34.000 --> 01:50:45.000
I've been wet right there. So, that's how we found it. But… you know, when we dug this area up right here, we found those weird transitions, you know?

01:50:45.000 --> 01:51:03.000
They were basically transitions that you would see on a water line, not on a gas line. But it sounds like the record that we're keeping going forward is the GIS. Yeah. Yeah, GIS, and then… and then we use a… a database called Energy WorldNet, and that's where our gas system records go in, and that's where all of our.

01:51:03.000 --> 01:51:08.000
Operator qualifications are maintained, so we have to keep records of everybody.

01:51:08.000 --> 01:51:13.000
Who works on the gas system, what… when they were certified at 90 different.

01:51:13.000 --> 01:51:27.000
Procedures, so we have to keep records of everything. So it's like… you know, you… like a nuclear facility, you have to keep records of every little thing the gas system requires that now. It'd be interesting to go back and see when.

01:51:27.000 --> 01:51:39.000
The federal… laws were made for this, and what the rules were for keeping records, because our state probably has just, over time, with more incidents, become.

01:51:39.000 --> 01:51:48.000
Much more, uh… Um, focused on… us following the rules. I don't know how it was in the 80s, you know, how…

01:51:48.000 --> 01:51:56.000
How the audits worked in the 80s, I don't know how they, um, they probably had paper records, and at some point, oh, these are old.

01:51:56.000 --> 01:52:04.000
And maybe that's how they got thrown out. But everything that we have is now in there.

01:52:04.000 --> 01:52:12.000
And I know James and I have gone through a lot of old filing and musty old files to find stuff in, and.

01:52:12.000 --> 01:52:15.000
When I first came here, I went through a lot of really old AutoCAD.

01:52:15.000 --> 01:52:21.000
You know, and you're going back with floppy disks, trying to piece together this AutoCAD file.

01:52:21.000 --> 01:52:29.000
And see if you can piece together what they did. So, yeah, it's been a… it's been an investigative process over the last 25 years that I've been here.

01:52:29.000 --> 01:52:38.000
That we did it. Uh, so now moving on to kind of a whole different section of the, uh.

01:52:38.000 --> 01:52:44.000
Presentation. So, uh… the project out at Elk Ridge, it's ongoing.

01:52:44.000 --> 01:52:50.000
Um, it's, um, it's been moving well apace. We got an update today, actually.

01:52:50.000 --> 01:53:03.000
Um, we… we're out there, uh, daily to do inspections. Um, it… it's… you know, they've run into a few hiccups because they don't know where other utilities are, so they've… they've had.

01:53:03.000 --> 01:53:10.000
Some issues working around the other utilities, but as far as the mains are concerned, they're almost complete.

01:53:10.000 --> 01:53:15.000
In putting the mains in. A lot of the service still need to be, uh.

01:53:15.000 --> 01:53:19.000
Put in, but, um… It's going pretty well.

01:53:19.000 --> 01:53:27.000
The problem is that, um, now they're getting into the portion of work where they're getting up to the homes, and they're.

01:53:27.000 --> 01:53:34.000
They're starting to look at how the coordination is going to be in tying the homes in.

01:53:34.000 --> 01:53:38.000
To the new gas system. And, uh, you know, we had a couple of.

01:53:38.000 --> 01:53:46.000
Incidents where, you know, um… Gas was knocked out, and then to put them back on, you know, we had to do some inspections. We found out that.

01:53:46.000 --> 01:53:53.000
There's gonna be a lot of, um… out of compliance, um…

01:53:53.000 --> 01:53:58.000
Home… plumbing and appliances. So, that…

01:53:58.000 --> 01:54:03.000
They're gonna have to work that out with their residents to help them.

01:54:03.000 --> 01:54:11.000
Get things up to code, because things have to follow the plumbing code, and then they have to do a new pressure test that's observed by the state.

01:54:11.000 --> 01:54:23.000
So, there's a couple of things there. The state… um, has to… schedule all of that with… they have to coordinate it and schedule… so Cartwright Plumbing, which is a residential plumber.

01:54:23.000 --> 01:54:30.000
Has to schedule all of that with the state. State seems to have a few… seems to have some problems with staffing.

01:54:30.000 --> 01:54:36.000
They were looking at doing maybe 10 a day. But right now, that's still up in the air.

01:54:36.000 --> 01:54:41.000
Um, 10 a day, starting… maybe late October.

01:54:41.000 --> 01:54:52.000
It's… I'm afraid that this is going to go well past heating season, and we really can't be doing that during the winter, especially if we're afraid that people have some.

01:54:52.000 --> 01:54:56.000
Plumbing issues, and a lot of the plumbing. Code issues are fairly small.

01:54:56.000 --> 01:55:04.000
They're like little fittings, a little strainer, maybe a catch pan on the bottom, things that are easily fixed, but.

01:55:04.000 --> 01:55:13.000
Um, if we do that, like. Middle of January, and suddenly they can't get their heat turned back on that day. That's just a…

01:55:13.000 --> 01:55:18.000
It's too risky, so, um, we're gonna have to look at a Plan B and start.

01:55:18.000 --> 01:55:24.000
It's not our project right now. We're overseeing the part of the municipal side.

01:55:24.000 --> 01:55:28.000
So it's, um, kind of hard to get in the middle of.

01:55:28.000 --> 01:55:35.000
Of a third-party, uh. Project. So, you know, we're letting them, uh, work that out with the residents.

01:55:35.000 --> 01:55:45.000
And we'll assist with any technical, um, information we can provide, but… So is the main… problem that you're worried about, then, if I take it…

01:55:45.000 --> 01:55:49.000
What I thought I just heard is basically getting the state out in time.

01:55:49.000 --> 01:55:56.000
It is. Okay. Yeah. Yeah, Cartwright's great. They're doing a good job. I think the coordination is going well.

01:55:56.000 --> 01:56:03.000
Um, it's really… timing, you know, the project, there were some delays in getting it started and off…

01:56:03.000 --> 01:56:07.000
You know, off the ground. It would have been better if it would have gotten started in, like, April.

01:56:07.000 --> 01:56:17.000
But it really didn't get kicked off till, like, around July 1st. So… you know, those months are lost, and so I think we're just gonna have to take.

01:56:17.000 --> 01:56:26.000
Take it as, you know, we lost those 3 months, now we're gonna have to… shove the rest of the project to next spring.

01:56:26.000 --> 01:56:32.000
Well, they are gonna have to. That's just the way I'm seeing it, but we'll see what happens. If they can start.

01:56:32.000 --> 01:56:37.000
Getting at least the process going, and we have some warm days.

01:56:37.000 --> 01:56:39.000
They can push it until we see a real cold snap.

01:56:39.000 --> 01:56:45.000
That's kind of how we… we would do it. But again, that's up to them.

01:56:45.000 --> 01:56:52.000
They give us some updates about it, and they… today, I did see that they're recognizing that.

01:56:52.000 --> 01:56:59.000
The issue with the state permitting is probably their biggest. Constraint.

01:56:59.000 --> 01:57:07.000
Uh, on our side, we've been providing inspection services, which are required, records management, so we have to take all the records of.

01:57:07.000 --> 01:57:16.000
Every person who touches that gas system. Um, all of their certifa… they… we actually certify their welders in our shop, so… so we're…

01:57:16.000 --> 01:57:22.000
We're, um… We're very involved in the municipal side of the installation.

01:57:22.000 --> 01:57:25.000
Uh, we do, like I said, we oversee the pressure testing.

01:57:25.000 --> 01:57:34.000
Their welds, all of that kind of stuff. Um, we are… um, physically, ourselves, uh.

01:57:34.000 --> 01:57:39.000
Doing the meter manifold installations. Most of them are double meters. There are a few singles.

01:57:39.000 --> 01:57:45.000
Um, there are over 81 installations. We use a new type of meter.

01:57:45.000 --> 01:57:51.000
They don't really have mechanical parts in them, they're more of a, you know, 21st century style meter.

01:57:51.000 --> 01:57:59.000
Um, and, um… We provide pressure regulators, all the valves, fittings, and of course, the system operation. And it should be noted that.

01:57:59.000 --> 01:58:04.000
Um, all of that aside. We're gonna take over ownership of it forever.

01:58:04.000 --> 01:58:12.000
So, it's gonna be ours, our responsibility, and we've got to maintain it and do all the reporting and everything.

01:58:12.000 --> 01:58:19.000
That takes a lot to do. Clay, you said something earlier about doing the monthly inspections.

01:58:19.000 --> 01:58:34.000
Through July, I think you said. Are we still doing monthly inspections? And if not, why not? You know, I think… I'll have to ask our gas supervisor. I think because we're out there all the time, they kind of stopped doing… going in underneath everybody's homes.

01:58:34.000 --> 01:58:41.000
And everything, so they just kind of, you know, they've been out there every day, so they haven't gone back and done.

01:58:41.000 --> 01:58:46.000
Yet a full-blown leak survey, um, just because they're out there every day.

01:58:46.000 --> 01:58:55.000
Um, but I think we're gonna have to really start now that… now that, uh, the project is gonna go into the winter, we need to do another… we need to keep doing the leak survey.

01:58:55.000 --> 01:58:59.000
Um, I think what's gonna happen is there might be a time.

01:58:59.000 --> 01:59:09.000
Where the project halts. For a bit, uh, and let winter get through the toughest part, and so, yeah, we need to keep doing the leak surveys, no question about it.

01:59:09.000 --> 01:59:23.000
That was kind of a… compromise we made with the PRC, um, that it's best practice to just keep performing the leak survey so that we ensure that the gas system still has good integrity.

01:59:23.000 --> 01:59:33.000
So, yeah, we need to continue it now. So, Clay, if the project stops during the winter, if you're foreseeing that as a likely outcome, right, at some point you're going to have to.

01:59:33.000 --> 01:59:37.000
Stop the project. How many of our customers are going to be without gas?

01:59:37.000 --> 01:59:43.000
No one, we're keeping the current gas system in operation, so we're… I see. So, really.

01:59:43.000 --> 01:59:55.000
Once… once the coordination with the state is really off the ground, it's like they would do the pressure test, move them over that day, so they would only be without gas for a portion of a day.

01:59:55.000 --> 02:00:04.000
So that's why we can't just do this, you know, ad hoc, willy-nilly. We have to… everything has to be really ready and in place.

02:00:04.000 --> 02:00:10.000
And they have to know that all their appliances are… up to code, and everything's truly ready.

02:00:10.000 --> 02:00:26.000
Before we pull the plug, and they're on the dark side of the moon, let's say, for that… for that little bit of time where you just can't stop. You're gonna have to… get it done. Um, and so we need to ensure that everything is compliant before we do it.

02:00:26.000 --> 02:00:32.000
Thanks. That's going to take some time, and you don't want to do that in the wintertime and cut people off, yeah.

02:00:32.000 --> 02:00:45.000
Um, this is a typical… we kind of mocked up. What it's going to take for each of the meter sets. Um, you know, every… you know, think about it, but it's kind of like a little plumbing job under your sink. You know, you got all these little parts and pieces.

02:00:45.000 --> 02:00:50.000
So we, uh, you know, worked it up and found our dimensions, what it's going to take.

02:00:50.000 --> 02:00:59.000
And so, that's… that's kind of typically what one looks like. On the left side, you would have the riser that comes up out of the ground.

02:00:59.000 --> 02:01:05.000
It's gonna come up out of the ground, um, go through two different meters, or two different regulators, two different meters, and then.

02:01:05.000 --> 02:01:16.000
You'd see pipes going out of the… you see those, uh… pipe ports off the top of those meters, and then those would go into the homes. Why two?

02:01:16.000 --> 02:01:22.000
What's that? Wait, 2 meters? Yeah, right there. Um, that way we could run one service line.

02:01:22.000 --> 02:01:29.000
So, you would have fewer trenches, and uh… Um, just headaches.

02:01:29.000 --> 02:01:35.000
To get it to… because the homes are close together, and so you can manifold it.

02:01:35.000 --> 02:01:55.000
On the backside of one home and the front side of another, and you just have one trench going to a… to a common meter location, and then the service lines would then go… Okay, so this is 2 meters to 2 homes? 2 homes, yes. Okay, that makes sense. Oh, yeah, I'm sorry, I didn't… Okay. That's the simple answer. Thank you. So, Clay, just out of curiosity, is that Blackguard, or is that steel?

02:01:55.000 --> 02:02:03.000
They're steel. Okay. Yeah. It kind of looks like black iron. Well, it is dark-colored. I mean, it's carbon steel.

02:02:03.000 --> 02:02:15.000
And then… and then what we do is we… we… we sand it and then paint it. Yeah, so then… and that's… that's part of the issue out there now, is that a lot of it hasn't been maintained, so there's a lot of…

02:02:15.000 --> 02:02:28.000
Atmospheric corrosion. It's nothing… it's nothing concerning, but in time, you know, you don't want things to be corroded in a gas system.

02:02:28.000 --> 02:02:33.000
Yeah, so the project, I said it began… really, it began in July.

02:02:33.000 --> 02:02:39.000
And I think it was proposed that it was supposed to be done late October and early November, but the.

02:02:39.000 --> 02:02:49.000
Schedule being… how it slipped so much. It's just not there yet. Um… They are more than 50% complete, with the municipal…

02:02:49.000 --> 02:02:55.000
Municipal-side piping, they're more on that west end now. They've gone around the loops and up the middle.

02:02:55.000 --> 02:03:01.000
So they're pretty far along. Um… No portions have been put into place. Another.

02:03:01.000 --> 02:03:13.000
Piece of the puzzle is that LANL has this, uh, currently they have a regulator station out there, and it's dropping the pressure going into it. We've decided to eliminate that and eliminate.

02:03:13.000 --> 02:03:28.000
Yet another complexity, so they're gonna be… Um, on a 60-pound system, which is what Lanel delivers there, so we're just keeping it as a 60-pound system, just like in White Rock, and that's pretty typical, that's what you'd find in Albuquerque.

02:03:28.000 --> 02:03:32.000
Places like that. But, um… So they've got some reconfiguring.

02:03:32.000 --> 02:03:41.000
To do right outside of the park itself, on the. In that fence where Lionel's meter is, and that reg station, we have a plan together.

02:03:41.000 --> 02:03:48.000
But they haven't really… Um, I haven't begun the work. We thought it would be like, oh, you'll be here next week, but…

02:03:48.000 --> 02:03:55.000
They're putting together, um, because there is kind of a chain of custody of that.

02:03:55.000 --> 02:04:04.000
And they're putting together documents and rules and responsibilities, but. Um, I would expect to see them begin that… their portion of it anytime.

02:04:04.000 --> 02:04:10.000
Um, like I said, there will be some complications with the mobile home division.

02:04:10.000 --> 02:04:18.000
From CID, and uh… yeah, it's not gonna be done this winter, I think.

02:04:18.000 --> 02:04:24.000
And this is kind of what it looks like. Um, you know, the… there's… some of them have long trenches.

02:04:24.000 --> 02:04:29.000
This is one of the single meter sets, and that's, like, one of the first homes inside, but most of them.

02:04:29.000 --> 02:04:35.000
Or this double meter set that is gonna be a common meter placed.

02:04:35.000 --> 02:04:42.000
And then two different lines run from that point. Residential side.

02:04:42.000 --> 02:04:48.000
And looking at a different angle, you see that then it branches off to the other home.

02:04:48.000 --> 02:04:57.000
And they have some pretty interesting equipment to dig these little tiny trenches.

02:04:57.000 --> 02:05:08.000
That's it. I'll just add that, you know, over the years, we've invested a lot in the gas system, and it really.

02:05:08.000 --> 02:05:14.000
It's a really good gas system, you know, we… over time, because we have.

02:05:14.000 --> 02:05:20.000
Had a lot of contact with our gas system in pretty much every neighborhood. We do find little.

02:05:20.000 --> 02:05:27.000
Unknown things. We found something actually near Philo's house, and it, you know, it took us a little while to fix this.

02:05:27.000 --> 02:05:37.000
Kind of complicated, and it's usually on the services, where same thing happened. They were inserting a line, and for some reason, they would hit a bend or something and stop.

02:05:37.000 --> 02:05:42.000
And that… those are the… those are the little issues where we're finding. And fortunately.

02:05:42.000 --> 02:05:54.000
Most of that happens in… isolated areas in the Los Alamos system, which is on a 20-pound system. White Rock, we know everything. White Rock, the records are there. We got it from PNM.

02:05:54.000 --> 02:06:02.000
And we don't find any… surprises in White Rock. White Rock System's great. Steel is in great shape.

02:06:02.000 --> 02:06:06.000
Um, and it's all in the same condition, and we know.

02:06:06.000 --> 02:06:12.000
What we have in White Rock. The… the… The unknowns we find in town site.

02:06:12.000 --> 02:06:18.000
The lines that run in backyards, we'll just find this… weird little section of steel, and a few…

02:06:18.000 --> 02:06:28.000
Quite a few years ago, maybe around. I don't know, 2000 and… 6 to 2008, we had a big project to go through where we did have.

02:06:28.000 --> 02:06:37.000
Records of isolated steel sections, and we went through and we removed… we fixed all those. So, the ones that we had records of, we actually went and fixed.

02:06:37.000 --> 02:06:46.000
Um, now we're finding the ones that we don't. Have records of. And so, um, that's how we find them, is just kind of here and there, because there's no way to predict it.

02:06:46.000 --> 02:06:54.000
You know, so really, it's until it… fails, unfortunately, but usually they're what we call Grade 1 leaks. It's just somebody.

02:06:54.000 --> 02:07:01.000
A jogger, and I've even found it running around town, I'm like, I smell gas, and I'll go back.

02:07:01.000 --> 02:07:08.000
And call the guys, and I'm like, hey, I smell gas at this address, and sure enough, they'll go out and find me, oh, we found a little leak on there.

02:07:08.000 --> 02:07:17.000
Service line. Um… So, you know, otherwise, the integrity of the gas system is very good. We have a lot of…

02:07:17.000 --> 02:07:25.000
Miles of line, because, you know, we have the mesas, and so there's a lot of line that has to manifold out, and then.

02:07:25.000 --> 02:07:36.000
Over the years, we actually connected them, so we have a lot of backfeed contingency, too. So, um… You know, that just adds to a high level of reliability and the.

02:07:36.000 --> 02:07:45.000
The gas lines themselves are in very good shape, so… It's a great gas system, really.

02:07:45.000 --> 02:08:01.000
Yeah, so I'm just curious if we've had any customers disconnect from the gas system in the past year because of… since they've electrified their house. Does anybody know that? You know, that's a… that's an interesting question. We'd have to… I… I don't know that… that answer, but we're not seeing that, really.

02:08:01.000 --> 02:08:07.000
People have… we… what we do see is that there's a lot of… Um, renewal.

02:08:07.000 --> 02:08:17.000
Of appliances so that people have now. A lot of heat pumps, and they're just more efficient systems. So we're seeing a lot of replacement of old.

02:08:17.000 --> 02:08:30.000
You know, burn a lot of gas, burning appliances, and then, um… energy-efficient windows and insulation, because that really reduces the gas use just.

02:08:30.000 --> 02:08:35.000
A huge amount, so… Um, in, you know, in my opinion.

02:08:35.000 --> 02:08:48.000
You know, until we really are generating electricity, you know, with carbon… you know, carbon-free sources, you know, the gas system for now is in great shape, and.

02:08:48.000 --> 02:08:54.000
You know, uh… getting your house more energy-wise is probably one of the most…

02:08:54.000 --> 02:09:02.000
Um, green things that we could be doing, instead of, like, you know, forcing them to get off of the gas system, because.

02:09:02.000 --> 02:09:06.000
Um, you know, when we talk to a customer, they're like, I can't believe.

02:09:06.000 --> 02:09:17.000
You know, just replacing my windows and putting insulation on my roof, my gas bill went down to hardly anything all winter long, you know? So, you know, those are the kind of stories we hear.

02:09:17.000 --> 02:09:27.000
Yeah. Other questions or comments?

02:09:27.000 --> 02:09:32.000
Thank you, Clay.

02:09:32.000 --> 02:09:38.000
Okay, last agenda item. Is, uh…

02:09:38.000 --> 02:09:44.000
The annual self-evaluation of the board. And…

02:09:44.000 --> 02:09:49.000
This… the… valuation…

02:09:49.000 --> 02:09:58.000
Questions, if you will, or the forms have been distributed. So everybody's had a chance to comment, but here's your final chance to comment.

02:09:58.000 --> 02:10:06.000
Um, before we actually… do it, and… That one problem.

02:10:06.000 --> 02:10:12.000
Those, I think, will be distributed soon. Um.

02:10:12.000 --> 02:10:20.000
One thing I would ask is, uh. Are we going to get the results from the board?

02:10:20.000 --> 02:10:26.000
And the staff separately? Are they going to be combined again?

02:10:26.000 --> 02:10:31.000
They would be combined. Because that's how the whole code, um…

02:10:31.000 --> 02:10:42.000
Software collects the information. Their anonymous responses. But they don't flag them as to whether they're bored or… No.

02:10:42.000 --> 02:10:47.000
Staff, um, that… That's unfortunate, but okay, that's what it is.

02:10:47.000 --> 02:10:55.000
You could ask… insert a question that asks. If they want to indicate whether they're board or staff.

02:10:55.000 --> 02:11:02.000
We could do that. That may help, that may… differentiate some. Well, that would tell us whether.

02:11:02.000 --> 02:11:13.000
All five board members responded, but it wouldn't tell you whether the answers from, uh, corresponded… came from a board or came from a staff.

02:11:13.000 --> 02:11:19.000
Uh, uh, person. Catsy, could we run just two of them?

02:11:19.000 --> 02:11:27.000
I can look into that. I'm… I could probably… I can check with Julie tomorrow and see.

02:11:27.000 --> 02:11:33.000
We do have different perspectives. Hopefully there's some similarity, but uh…

02:11:33.000 --> 02:11:40.000
Um, there is… People look at things differently, depending on where we sit.

02:11:40.000 --> 02:11:45.000
So, Eric. Well, speaking of looking at things differently, I'm glad you said that.

02:11:45.000 --> 02:11:49.000
Um, I'm a little nitpicky thing here about surveys in general.

02:11:49.000 --> 02:11:57.000
It's impossible to strongly agree. Grammatically and by definition. So, what I would prefer to see…

02:11:57.000 --> 02:12:04.000
Is for strongly agreed to simply be agree. And then the other one partially agree.

02:12:04.000 --> 02:12:10.000
And I know I'm out to lunch on this one, because this is the way that all surveys are done.

02:12:10.000 --> 02:12:13.000
But depending on what culture you come from, what country you're born in.

02:12:13.000 --> 02:12:22.000
Strongly agree, makes no sense. Okay, I've said my piece. Thank you.

02:12:22.000 --> 02:12:29.000
I hear you, but I'm not sure that… We want to try to change all of the headings.

02:12:29.000 --> 02:12:40.000
This toy surveys are the same problem would apply on the other end of the spectrum. Exactly. Exactly, there's no such thing. But… so we just kind of take it for granted that.

02:12:40.000 --> 02:12:45.000
We… we… assume that they mean what…

02:12:45.000 --> 02:12:55.000
You know… Well, we could assume that, and then probably proceed as we always have. That's what we're gonna do.

02:12:55.000 --> 02:13:03.000
I just wanted to say it, okay, thank you. Your grammatical point is noted. Thank you, thank you.

02:13:03.000 --> 02:13:09.000
Other thoughts, questions, comments?

02:13:09.000 --> 02:13:21.000
Eric had a suggestion that we add a question. Um, the question he proposed adding was that the board actively seeks out input from the community and incorporates this.

02:13:21.000 --> 02:13:31.000
In their strategic initiatives. Um, I am going through here, thought I found…

02:13:31.000 --> 02:13:41.000
Um, three questions that basically already cover that. Um… the, uh…

02:13:41.000 --> 02:13:53.000
3a and B. Board understands its obligations to see that the organization acts in the best interests of utility customers and citizens of the county.

02:13:53.000 --> 02:14:00.000
Me, the board actual diligence and objectivity on behalf of utility customers and the county.

02:14:00.000 --> 02:14:07.000
And then, um, this is now… 6… 7, excuse me, 7, 8.

02:14:07.000 --> 02:14:13.000
The board strives to represent the interests of the entire community it serves.

02:14:13.000 --> 02:14:21.000
And it seems to me that covers… what Eric's trying to get at. Do you agree, Eric?

02:14:21.000 --> 02:14:29.000
Yeah, I saw those same three questions. And I guess my thinking is more, what do we do to…

02:14:29.000 --> 02:14:40.000
Ascertain the spirit of the community. You know, I mean, we can send out surveys. I keep getting this concept that we ought to set up a table at Smith's and just…

02:14:40.000 --> 02:14:53.000
You know, as people walk in, have a comment section, you know, and say, hey, we're the Board of Public Utilities, now's your time. Yeah, just actually try… and I don't know how to do that, but the concept is.

02:14:53.000 --> 02:15:00.000
Do we go out, and how do we solicit? Community feedback. How do we do that?

02:15:00.000 --> 02:15:04.000
Well, how we do it is separate from do we do it?

02:15:04.000 --> 02:15:08.000
What you propose is the Board actively seeks out input. Right.

02:15:08.000 --> 02:15:16.000
And the… the last of those three questions says, the board strives to represent the interests of the entire community.

02:15:16.000 --> 02:15:22.000
It serves, well, to represent the interests we have to. We have to seek out input.

02:15:22.000 --> 02:15:34.000
I think that's where the gap is. Because, yeah, we want to… act on their feedback, but do we actually get it?

02:15:34.000 --> 02:15:46.000
We can only work with what we get. So, I would… so my problem when I saw your… your edition, um, was.

02:15:46.000 --> 02:15:54.000
I didn't understand what actively meant. Um, and what our role would be in that. Um, so, for example, a lot of the surveys that we've been.

02:15:54.000 --> 02:16:02.000
Conducting… actually haven't been us, is DPU, and we've discussed them, we've given our comments on them.

02:16:02.000 --> 02:16:07.000
Um, but it's actually from the department that those officials surveys go out.

02:16:07.000 --> 02:16:12.000
As a board, we do things like request comments at every meeting we have.

02:16:12.000 --> 02:16:19.000
We receive emails and respond, but we also attend many of the, um.

02:16:19.000 --> 02:16:29.000
Farmers markets, for example. And so, that in particular, I would guess, is sort of an active approach to looking for feedback and comments.

02:16:29.000 --> 02:16:35.000
Um, there's also various sort of workshop-y kind of informative or informational, um.

02:16:35.000 --> 02:16:43.000
Meetings that we participate in. Usually done in conjunction with board… with DPU activities, department activities.

02:16:43.000 --> 02:16:50.000
So I'm not… I'm not sure it's… Yeah, so I'm not sure what you mean by actively seek out A and then B.

02:16:50.000 --> 02:16:56.000
Whether it's a, um… function, necessarily, of the…

02:16:56.000 --> 02:17:10.000
Board, beyond… what we do in collaboration with the department. So I'm a little confused there. If you wanted to add something to this section, to number 11, I would… I was trying to wordsmith it slightly.

02:17:10.000 --> 02:17:18.000
It could be the board works to ensure strategic initiatives align with county goals, community feedback.

02:17:18.000 --> 02:17:25.000
And DPU mission and goals, or mission and vision, actually. Um, there's a thought. But I'm not sure, um…

02:17:25.000 --> 02:17:36.000
It's necessary, given 3A, B, and 7. So, anyway, just… That's fine, I just wanted the discussion, that's all. I just threw it in there so we could have this discussion.

02:17:36.000 --> 02:17:51.000
Are you satisfied with the discussion? Yeah, I am. Well, I'm sorry, I guess it's just because we did go through this and did wordsmith a little bit earlier this year. So I was reasonably content with… what was there?

02:17:51.000 --> 02:17:55.000
I mean, so I'm fine, because we do have those questions in there, and I did read those.

02:17:55.000 --> 02:18:00.000
Okay, so… Are we comfortable with the…

02:18:00.000 --> 02:18:09.000
Uh, the questions here… to go forward with, with the hope that maybe we can get them separated between board and.

02:18:09.000 --> 02:18:13.000
Staff? If not, well, we'll just have to live with it.

02:18:13.000 --> 02:18:20.000
Okay, I think I'm seeing head nods all the way around, so… Good. Uh…

02:18:20.000 --> 02:18:37.000
I think that completes that one. Could I ask a question, Chair Gibson? Sure. I just need clarification on who should… received the survey, because last year you expanded it to senior managers, and then we also sent it to the council chair and vice chair.

02:18:37.000 --> 02:18:43.000
Now, do you want to expand it to all counselors, or… I just need to know who to send it to.

02:18:43.000 --> 02:18:55.000
Well, fair question. Is there any reason to change what we did last year?

02:18:55.000 --> 02:19:04.000
We can ask our council representative. Well, that's… that's probably a very good suggestion.

02:19:04.000 --> 02:19:17.000
Put, uh, put you on the spot there, Susie. Do you think all your counselors would like to provide feedback, or… Do they… are they enough involved in what we do? You're here…

02:19:17.000 --> 02:19:23.000
Every meeting, and you pay a lot of attention anyway, but I don't know how many of your other counselors do.

02:19:23.000 --> 02:19:30.000
Would it be useful feedback? Or is just one more thing they have to do? Because it does take a little while to fill these out.

02:19:30.000 --> 02:19:37.000
Everyone has a full plate, yeah. Justifies the time that we needed.

02:19:37.000 --> 02:19:43.000
Right now, because you feel otherwise. I'm all leaders, I can make a pitch.

02:19:43.000 --> 02:19:54.000
The, uh… I tend to think the way you do, that the… and we don't want… feedback that isn't informed. True.

02:19:54.000 --> 02:20:00.000
To garbage in, garbage out.

02:20:00.000 --> 02:20:07.000
Okay, thank you. Nice. Sorry. No.

02:20:07.000 --> 02:20:13.000
We asked the question, you answered it, thank you. Um, any…

02:20:13.000 --> 02:20:18.000
Any desire to change? Okay, Kathy?

02:20:18.000 --> 02:20:24.000
We'll keep going with the same… same folks. Thank you for raising the question.

02:20:24.000 --> 02:20:31.000
Anything else on this topic? If not, we're down to public comment.

02:20:31.000 --> 02:20:56.000
Is there any further public comment? Yes, there is.

02:20:56.000 --> 02:21:00.000
I'm Richard Cottrell, as I hover along here for a moment.

02:21:00.000 --> 02:21:05.000
Um, yes, I am a… Current resident of Elk Ridge.

02:21:05.000 --> 02:21:11.000
And, uh, so the… comments and information about the gas system.

02:21:11.000 --> 02:21:17.000
Was, uh, very enlightening. Glad to hear it. Um, we'll talk about some…

02:21:17.000 --> 02:21:23.000
Quality assurance issues. But, um, I woke up to the issue, but…

02:21:23.000 --> 02:21:29.000
You brought up a point that's very important. The survey.

02:21:29.000 --> 02:21:38.000
You have a list of every resident that uses gas. User services. That's a mailer. That's a mailing…

02:21:38.000 --> 02:21:44.000
Out for email or whatever to respond to. That's a good point to start with.

02:21:44.000 --> 02:21:55.000
Um, as well as… Other public areas. And, uh, I would encourage you to… I'm on your mail list, I'm on your email list. I… but I don't get that survey.

02:21:55.000 --> 02:22:00.000
I'd love to answer that survey. I don't know you all, but I see the results of what you do.

02:22:00.000 --> 02:22:07.000
So, that would be appreciated, and that's appropriate, I think. Um, okay, back to the comment about.

02:22:07.000 --> 02:22:13.000
The quality of the work. Being done by the contractor.

02:22:13.000 --> 02:22:19.000
And then what's going on. The current design… I live in, um, unit number 310.

02:22:19.000 --> 02:22:25.000
At the top of the west end of the… of the list. And we're one of the last people.

02:22:25.000 --> 02:22:30.000
That has so far been cert… been… cut in and serviced. Um…

02:22:30.000 --> 02:22:36.000
Talk to the engineer, the inspector, as well as the foreman of the project.

02:22:36.000 --> 02:22:43.000
The design has coming off the street. 30 feet, and they put the riser.

02:22:43.000 --> 02:22:47.000
With the double, and the planets but the riser, the riser's in.

02:22:47.000 --> 02:22:52.000
And put the… double regulator serving two homes.

02:22:52.000 --> 02:22:58.000
Going forward. The problem is… The trailer that we're in.

02:22:58.000 --> 02:23:04.000
That service connection is 60 feet off the street, because it comes off the back, it comes off the easeway.

02:23:04.000 --> 02:23:10.000
The two areas. That service… to that trailer.

02:23:10.000 --> 02:23:15.000
Riser is right next to the trailer. It's 40 feet away from…

02:23:15.000 --> 02:23:22.000
The planned riser and design. The… I asked them to move it.

02:23:22.000 --> 02:23:35.000
Says, but can you take it back to where it's not in the middle of the roadway? The… The parking areas, the… Sidewalks, the whole gamut of where vehicles are parked.

02:23:35.000 --> 02:23:38.000
And the answer was, we have to do it per design.

02:23:38.000 --> 02:23:44.000
Now, we may take it a few feet in the middle between the two trailers, but that still leaves a riser.

02:23:44.000 --> 02:23:50.000
Right smack dab into the middle of everything. And when the snow comes.

02:23:50.000 --> 02:23:56.000
Well, the likelihood of that getting hit are very high. That means that's going to be a problem.

02:23:56.000 --> 02:24:00.000
For a lot of people, plus the danger of the damage that this can occur.

02:24:00.000 --> 02:24:06.000
They won't make a change. Now, Cartwright's supposed to make the connection between.

02:24:06.000 --> 02:24:13.000
The riser to the traders. Okay. I understand that there's going to be a charge.

02:24:13.000 --> 02:24:21.000
To the homeowner of $1,000. 800 to 1,000, whatever the case may be. That's a rumor.

02:24:21.000 --> 02:24:25.000
Whether it's true or not, I had to catch safe, because we have not been contacted.

02:24:25.000 --> 02:24:33.000
You promised us there would be no cost. To hooking up the trailers when we discussed this back.

02:24:33.000 --> 02:24:37.000
Early in the first of the year, when I was here.

02:24:37.000 --> 02:24:43.000
I'm gonna hold you to that. And I'm gonna trace the money down. The money is the issue.

02:24:43.000 --> 02:24:48.000
It costs more money to cut that and put it in place where it needs to go.

02:24:48.000 --> 02:24:54.000
I understand that. But that's not our concern. We need a safe, installed.

02:24:54.000 --> 02:24:59.000
Out of the way, gas service. That doesn't interfere.

02:24:59.000 --> 02:25:06.000
With normal operations and the plan of the current operations of the trailer.

02:25:06.000 --> 02:25:12.000
It's not happening! I hope it does in the future. Thank you for your considerations.

02:25:12.000 --> 02:25:18.000
Um, one more thought. Every few days.

02:25:18.000 --> 02:25:27.000
Turn on the faucet, and you get a lot of air blowing out. That means they cut the water line someplace. Every day or so, they cut the water line, they cut the water, they cut the water.

02:25:27.000 --> 02:25:34.000
There's a lot of it going on. Okay, well, shall we get a little out of air, and uh…

02:25:34.000 --> 02:25:40.000
We go on and take another day. But it's sure disconcerting when you're sitting in the sink and you get splattered all over.

02:25:40.000 --> 02:25:51.000
But in any case, we will trial and tribulate. Through the construction. And we're looking for a operational system.

02:25:51.000 --> 02:25:55.000
That is very good. I'm gonna hold you guys to what you said.

02:25:55.000 --> 02:26:00.000
There was no cost. To our connection.

02:26:00.000 --> 02:26:06.000
Please. Look into this, because this rumor is starting to gel.

02:26:06.000 --> 02:26:13.000
That we're going to have a $1,000 or more. Connection fee. Pressure test, Cartwright. Whatever they want to call it.

02:26:13.000 --> 02:26:17.000
Pressure tests and inspections are not that expensive, they're less than $100.

02:26:17.000 --> 02:26:22.000
But they're going to charge $1,000. That's what I've been what the rumor is.

02:26:22.000 --> 02:26:26.000
That's not good. A lot of people won't be able to do that.

02:26:26.000 --> 02:26:35.000
You know, it's gonna hit different ways. Maybe it's gonna have to be… paid off over time. But it's still…

02:26:35.000 --> 02:26:41.000
Expense that's not planful. As to the service.

02:26:41.000 --> 02:26:45.000
Thank you. Thank you very much for your comments. Thank you for your time.

02:26:45.000 --> 02:26:52.000
And look forward for a good service, and appreciate your efforts. Thank you. Thank you. Thanks for coming this evening.

02:26:52.000 --> 02:27:07.000
Do we have any other public comment? Thank you, Chair Gibson. We have public online. If anybody would like to make a comment, please use your raise hand function.

02:27:07.000 --> 02:27:11.000
I don't see anybody with their hand up, Chair Gibson. Okay, thank you very much.

02:27:11.000 --> 02:27:18.000
Thank everyone for… Joining us this evening for another evening of fun and frolic.

02:27:18.000 --> 02:27:23.000
I was waiting for that, thank you. And, uh, we stand adjourned.

02:27:23.000 --> 02:27:33.000
And, uh, the board will reconvene in a few minutes down in the DPU conference room for a closed session.