Po p u la tio n G ro w th 324,722 350,000 300,000 Po pula tio n - - PDF document

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City Counc il

Se pte mb e r 26, 2017

E le c tr ic and Wate r Utility 5- Ye ar Rate Pr

• posal

F Y 2018 – 2022 and Pr

• posal

for Annual CPI E sc alator for F Y 2023- 2027

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Po p u la tio n G ro w th

So urc e s: Ame ric a n F a c t F inde r/ Ce nsus.g o v a nd Sta te o f Ca lifo rnia , De pa rtme nt o f F ina nc e

46,764 324,722 300,000 250,000 200,000 150,000 100,000 50,000 1890 1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000 2010 2016

Po pula tio n

350,000

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A City – A Syste m of Syste ms

• Dr. Lucy Jones Center for

Science and Society, SCAG Presentation

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Ne c e ssar y Syste ms

• Dr. Lucy Jones Center for

Science and Society, SCAG Presentation

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Cr itic al Infr astr uc tur e Is Conne c te d

• Dr. Lucy Jones Center for

Science and Society, SCAG Presentation

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Damage d Wate r Supply

• Dr. Lucy Jones Center for

Science and Society, SCAG Presentation

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National Ne wspape r He adline s

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WAT E R – E NE RGY - L IF E

Utility 2.0 – Planning F

• r

Our F utur e

10-Ye a r I nfra struc ture Pla n

W a te r- En e rg y - Life

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ASCE Grading Sc ale

Good – Ade q ua te fo r No w E xc e ptional – F

it fo r the F uture

Me dioc r e – Re q uire s Atte ntio n Poor – At Risk F ailing/ Cr itic al – Unfit fo r

Purpo se

10- Ye ar Infr astr uc tur e Outlook

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ASCE Grading Sc ale

Good – Ade q ua te fo r No w E xc e ptional – F

it fo r the F uture

Me dioc r e – Re q uire s Atte ntio n Poor – At Risk F ailing/ Cr itic al – Unfit fo r Purpo se

Rive r side ’s Curre nt Gra de

10- Ye ar Infr astr uc tur e Outlook

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ASCE Grading Sc ale

Good – Ade q ua te fo r No w E xc e ptional – F

it fo r the F uture

W i t h o u t A c c e l e ra t i n g Re p a i r a n d Re p l a c e m e n t

Gra de s Moving in Wrong Dir e c tion

Me dioc r e – Re q uire s Atte ntio n Poor – At Risk F ailing/ Cr itic al – Unfit fo r Purpo se

Rive r side ’s Curre nt Gra de

Compr

• mise d

He alth/ safe ty

10- Ye ar Infr astr uc tur e Outlook

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5 Ye ar Costs: $ 335 Million

50% Re ne wa ble E ne rgy 1 Substation 7 T ra nsforme rs 5,900 Pole s City- wide Voltage Conve rsions Syste m Automation

77 Mile s of Unde r gr

• und Cable

0% Coa l Re lianc e Re gulatory Complianc e

Moving to a

Good – Ade q ua te fo r No w

E le c tr ic Syste m

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Moving to a

Good – Ade q ua te fo r No w

Wate r Syste m

5 Ye ar Costs: $ 171 Million

North Wa te rma n T re atme nt Plant 80 Mile s of Pipe line Re plac e T e c hite Pipe Re c yc le d Wate r Storm Wa te r Ca pture 3 Pre ssure Sta tions • Syste m Automation 5 We lls

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7 Ye ar s Without a Rate Inc r e ase

7 Ye ar s

sinc e the la st

e le c tr ic inc r e ase (2010)

sinc e the la st

wate r inc r e ase (2010)

7 Ye ar s

Re ne wable Powe r Re quir e me nts

I nc re a se d fro m

20% to 50%

sinc e the la st ra te pla n

F ive - ye ar Califor nia Dr

• ught

(2011-2016)

Hotte st and Dr ie st in Instr ume ntal Re c or d

sinc e the la te 1800s

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1 po und o f b a c o n

2010 - $3.22

T ide L a undry De te rg e nt

2010 - $7.97

Mo vie tic ke t

2010 - $7.50

So urc e : T he Pe o ple Histo ry.c o m/ pric e b a ske t.html

iPho ne 4

2010 - $399

1 po und o f po ta to e s

2010 - $0.52

T he Cost of Ave r age House hold Ite ms in 2010

So urc e : Apple .c o m

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1 po und o f b a c o n 2010 - $3.22

2016 - $4.48

T ide L a undry De te rg e nt 2010 - $7.97

2016 - $12.57

Mo vie tic ke t 2010 - $7.50

2016 - $10.49

So urc e : T he Pe o ple Histo ry.c o m/ pric e b a ske t.html

iPho ne 4 2010 - $399 iPho ne 7

2016 - $649

1 po und o f po ta to e s 2010 - $0.52

2016 - $0.78

Cost Inc r e ase of Ave r age House hold Ite ms

So urc e : Apple .c o m

58% 39% 50% 63% 40%

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RPU Wate r

$1.14/ c c f

(2010)

RPU E le c tr ic

$0.10/ kWh

(2010)

Cost Inc r e ase for RPU sinc e 2010

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Cost Inc r e ase for RPU sinc e 2010

RPU Wate r

$1.14/ c c f

(2016) $1.14/ c c f (2010)

RPU E le c tr ic

$0.10/ kWh

(2016) $0.10/ kWh (2010)

0%

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2.7 2.0 1.1 1.3 0.9 1.9 2.2 3 6 9 12 15 2011 2012 2013 2014 2015 2016 2017

Cumulative % Inc re ase in Rate or CPI

Annua l CPI

• Urb a n

Cumula tive I nc re a se in CPI

• Urb a n

13%

C u m u l a t i v e In c re a s e i s 1 3 %

Ur ban CPI Ove r the L ast 7 Ye ar s

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Year Fiscal Year % Change 1

17/18 5.00%

2

18/19 5.00%

3

19/20 5.00%

4

20/21 5.00%

5

21/22 4.00%

6

22/23 CPI

7

23/24 CPI

8

24/25 CPI

9

25/26 CPI

10

26/27 CPI 5 Year Avg 4.80%

Proposed Electric Rates Year Fiscal Year % Change

1 17/18 8.75% 2 18/19 8.50% 3 19/20 8.50% 4 20/21 8.50% 5 21/22 8.50% 6 22/23 CPI 7 23/24 CPI 8 24/25 CPI 9 25/26 CPI 10 26/27 CPI 5 Year Avg 8.55%

Proposed Water Rates

Ave rage Rate Change

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21 I nc lude s Pub lic Be ne fits Cha rg e a nd Wa te r Co nse rva tio n Surc ha rg e

Re side ntial 5 ye ar Ave r age Annual Pr ic e Change L

• w-Use

355 kWh 12 CCF T ypic al-Use 592 kWh 19 CCF High- Use 1400 kWh 29 CCF E le c tr ic $3.11 (5% ) $5.18 (5% ) $11.56 (4% ) Wate r $4.05 (12% ) $4.56 (10% ) $6.48 (8% ) Ave r age Combine d $7.15 (7% ) $9.74 (7% ) $18.05 (5% )

Re side ntial Ave r age Monthly Bill Inc r e ase for E ac h of the Ne xt 5 Ye ar s

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22 I nc lude s Pub lic Be ne fits Cha rg e a nd Wa te r Co nse rva tio n Surc ha rg e

Comme r c ial 5 ye ar Ave r age Annual Pr ic e Change Small 500 kWh 10 CCF Me dium 2400 kWh 37 CCF L ar ge 8000 kWh 119 CCF E le c tr ic $3.70 (3% ) $17.32 (4% ) $40.92 (3% ) Wate r $4.24 (12% ) $7.90 (8% ) $23.57 (8% ) Ave r age Combine d $7.94 (5% ) $25.22 (5% ) $64.49 (4% )

Comme r c ial Ave r age Monthly Bill Inc r e ase for E ac h of the Ne xt 5 Ye ar s

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23 costs revenue

E le c tr ic Wate r

Fixed Variable

C o s t i s m o s t l y f i x e d , re v e n u e i s m o s t l y v a ri a b l e

Utility Cost Str uc tur e is Imbalanc e d

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Cur r e nt Compe titive Advantage s Re main “Busine ss F rie ndly”

L

• w r

e side ntial and c omme r c ial utility r ate s E c onomic De ve lopme nt Rate inc e ntive s to e nc our age busine ss e xpansion and attr ac tion L ar ge industr ial c ustome r s r ate s as low as 10% lowe r than SCE Ne w and lowe r High Voltage Rate Ne w and lowe r r e str uc tur e d Re liability Char ge for small industr ial T OU c ustome r s Ne w Gr e e n Powe r Rate

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T ypic a l Re side ntia l Mo nthly E le c tric Bill:

Re ta il Co st o f 10 Bulb s $40 RPU's Co ntrib utio n ($30) Custo me r Co st $10

Cur r e nt Bill

$91

Pr

• pose d Bill

Inc re a se

$5

Ne w Ne t Bill

$89

De c r e ase if Imple me nte d

$7

Ways We Can He lp You Save

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T ypic a l Re side ntia l Mo nthly Wa te r Bill:

Re ta il Co st o f a WBI C $250 RPU's Re b a te ($200) Custo me r Co st $50 F re e Sprinkle rNo zzle s.c o m $0 Install a We athe r Base d Ir r igatio n Co ntr

• lle r

(WBIC) & 25 F r e e Spr inkle r No zzle s

Ways We Can He lp You Save

Cur r e nt Bill

$38

Pr

• pose d Bill

Inc re a se

$5

Ne w Ne t Bill

$37

De c r e ase if Imple me nte d

$6

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F

• r

infor mation: Rive r side Public Utilitie s.c om Or c all

So la r Attic F a n $300

RPU Re bate ($100) Ne t c ost $200

E ne rg y Sta r T V $300

RPU Re bate ($150) Ne t c ost $150

E ne rg y Sta r Ce iling F a n $150

RPU Re bate ($50) Ne t c ost $100

RPU offe r s mor e than 40 r e bate s to he lp you save !

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Ward 1 Ward 2 Ward 3 Ward 4 Ward 5 Ward 6 Ward 7 Total 519 534 4404 SHARE Participation Citywide 867 923 593 254 714

* T

• ta l b e twe e n 7/ 18/ 2016 a nd

7/ 17/ 2017

L

• w Inc ome Assistanc e in All War

ds

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Pr

• pose d L
• w Inc ome E

le c tr ic Pr

• gr

ams

1. E ne r gy Savings Assistanc e Pr

• gr

am:

I nc lude additio nal dire c t installatio n me asure s fo r e ne rgy e ffic ie nc y

2. Affor dable Solar E ne r gy for Rive r side :

I nc re ase PV re bate amo unt pe r kW

3. Re bate s:

I nc re ase E ne rgy S tar re bate s fo r S HARE e ligible c usto me rs

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4. Custome r E ngage me nt Pr

• gr

am:

E nro ll S HARE c usto me rs to re c e ive c usto mize d ho me e ne rgy re po rts

5. L E D Program:

Dire c t mail L E D bulbs to e ac h S HARE c usto me r

6. Inc r e ase mar ke ting and pr

• motion

for L

• w Inc ome pr
• gr

ams

Pr

• pose d L
• w Inc ome E

le c tr ic Pr

• gr

ams

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1. E ne r gy Savings Assistanc e Pr

• gr

am:

I nc lude additio nal dire c t installatio n me asure s fo r wate r e ffic ie nc y a . Hig h E ffic ie nc y T

• ile ts, Sho we r

He a ds a nd F a uc e t Ae ra to rs b . I ndo o r / Outdo o r Wa te r Audit

2. Inc r e ase mar ke ting and pr

• motion

for L

• w Inc ome pr
• gr

ams

Pr

• pose d L
• w Inc ome Wate r

Pr

• gr

ams

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Pr

• pose d E

le c tr ic Rate Re mains Compe titive

S CE

• 2018 to 2020 Ge ne ral Rate Case Pape rs ; 2021-2022 (ave rage o f 2018 to 2020); S

DG&E

• Assume d 3% pe r ye ar

Pro p o s e d a v e ra g e re s i d e n t i a l ra t e f o r 5 9 2 k W h p e r m o n t h

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Pro p o s e d a v e ra g e re s i d e n t i a l ra t e f o r 1 9 C C F p e r m o n t h

Pr

• pose d Wate r

Rate Re mains Compe titive

I nc lude s WMWD pro po se d 5.5% January 1, 2018, 2019, 2020, fo llo we d by 3% inc re ase s in 2021 and 2022; E MWD inc lude s assume d 3% rate inc re ase s.

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1. E xc e ss Re ne wable E ne r gy Sale s, to be r e alize d in upc oming ye ar s

$3-5 millio n/ ye ar

2. Adding PV Solar to we ll site s and lowe r ing E dison e le c tr ic c ost

$800,000/

ye ar

Re ve nue s F r

• m Othe r

Sour c e s

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3. T r ansmission r e ve nue s fr

• m Califor

nia Inde pe nde nt Syste m Ope r ator

$36 - $40 millio n/ ye ar o ve r ne xt 5 ye ars; he lps o ffse t transmissio n ac c e ss c o sts

4. Cap- and- T r ade Re ve nue s

$18 millio n fro m 2013 to date ; $15 millio n ne xt 3 ye ars

5. Se lling Sc he duling Coor dinator Se r vic e s to c itie s of Banning and Ranc ho Cuc amonga

$750,000/ ye ar

Re ve nue s F r

• m Othe r

Sour c e s

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7. We ste r n Whe e ling and E xc e ss Commodity Agr e e me nt

$100 millio n o ve r 20 ye ars

8. 55- ye ar le ase with Hillwood

po te ntial fo r $45 millio n

6. $85 million L ine of Cr e dit

re duc e s the amo unt o f c ash re se rve s we have to maintain and lo we rs rate

Re ve nue s F r

• m Othe r

Sour c e s

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6.3% 0.8% 0.7% 4.8%

E le c tr ic Rate s L

• we r

e d F r

• m 6.3% to 4.8%

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17.5% 6.0% 2.9% 8.6%

Wate r Rate s L

• we r

e d F r

• m 17.5% to 8.6%

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Infr astr uc tur e

RE PAIR AND RE PL ACE

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A g ing Pip e s

80+ Ye ar s old 50- 80 Ye ar s old 1- 50 Ye ar s old

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10 ar e over 60 year s ol d

60 Substation T r ansfor me r s

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39% ar e over 60 year s old

22,637 Utility Pole s

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824 Mile s of Distr ibution Mains

30% ar e over 60 year s old

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V i c t o ri a A v e n u e / Ly o n

Nove mbe r 2016 – Sinkhole

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C y p re s s / W a rre n

Mar c h 2017 – Sinkhole

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3 rd S t re e t

August 2016 – Sinkhole

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La S ie rra

Mar c h 2016 - Mic r

• bur

st

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F r

• m this…

… to this.

Har ve y L ynn Substation E xplosion Mar c h 2014

Har ve y L ynn Substation E xplosion

M a rc h 2 0 1 4

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UCL A Wate r Main Br e ak

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July 7, 2017 – Ce dar s Sinai

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July 8, 2017

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July 31, 2017

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August 1, 2017

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E le c tr ic

Re se r ve s be ing dr awn down

Wate r

Bonds – All Pr

• c e e ds Use d up 6/ 30/ 16

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$(100,000) $- $100,000 $200,000 $300,000 $400,000 $500,000 2016 2017 2018 2019 2020 2021

In Thousands

Re ve nue s E xpe nditur e s Unde signate d Re se rve T ar ge t Minimum Fa l l s Be l o w M i n i m u m i n a Y e a r

Re se r ve s (E le c tr ic )

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Fa l l s Be l o w M i n i m u m i n a Y e a r

Re se r ve s (Wate r )

$(20,000) $- $20,000 $40,000 $60,000 $80,000 $100,000 2016 2017 2018 2019 2020 2021

In Thousands

Re ve nue s E xpe nditur e s Unde signate d Re se rve T ar ge t Minimum

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Outr e ac h Goals

• 1. De sc rib e pro po sa l
• 2. Answe r q ue stio ns
• 3. Ge t fe e db a c k

PROPOSAL August 28 – RPU Boar d Se pte mbe r 26 – City Counc il OUT RE ACH Oc t - Nov RE COMME NDAT ION Januar y – RPU Boar d F e br uar y – City Counc il IMPL E ME NT AT ION Apr il 2, 2018

Outr e ac h Pr

• c e ss
• 1. Co mmunity me e ting s

in a ll Wa rds

• 2. I

nfo rma tio na l ma ile rs

Community Outr e ac h

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ASCE Grading Sc ale

Good – Ade q ua te fo r No w E xc e ptional – F

it fo r the F uture

W i t h A c c e l e ra t e d Re p a i r a n d Re p l a c e m e n t

Gra de s Moving in Right Dir e c tion

Me dioc r e – Re q uire s Atte ntio n Poor – At Risk F ailing/ Cr itic al – Unfit fo r Purpo se

Rive r side ’s Curre nt Gra de

10- Ye ar Infr astr uc tur e Outlook

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W i t h A c c e l e ra t e d Re p a i r a n d Re p l a c e m e n t

10- Ye ar Infr astr uc tur e Outlook

5 Ye ar Costs: $ 171 Million

• und Cable

5 Ye ar Costs: $ 335 Million

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Conne c te d City

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1. Una nimo usly a ppro ve d mo ving ra te pro po sa l re c o mme nda tio ns to City Co unc il. 2. Pub lic a nd Bo a rd disc ussio n, c o mmo n the me s inc lude d:

a )Pro viding suffic ie nt c usto me r o utre a c h to inc lude info rma tio n o n wa ys to sa ve ; de te rmining me tric s tha t will b e use d to g a ug e re spo nse s; pro viding c o mmunic a tio n to the Bo a rd o n the me s tha t e me rg e fro m c o mmunity me e ting s b )Pro viding spe c ific o utre a c h to ta rg e t lo w-inc o me c usto me rs; c ) E nsuring tha t the Bo a rd a nd City Co unc il ha ve o ve rsig ht a nd a ppro va l a utho rity

• ve r a ny a nnua l Co nsume r Pric e I

nde x (CPI ) ra te c ha ng e s o r c o st a djustme nts b e ing pro po se d, a nd d)Co nside ring a jo int RPU Bo a rd a nd City Co unc il wo rksho p in No ve mb e r to disc uss c o mmunity o utre a c h fe e db a c k a nd ne xt ste ps prio r to de ve lo ping a fina l re c o mme nda tio n.

8- 28- 17 Rate Pr

• posal to Boar

d of Public Utilitie s

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T hat the City Counc il:

• 1. Re vie w the E

le c tric a nd Wa te r Utility 5-ye a r Ra te Pro po sa l (Utility Ra te Pro po sa l) de ve lo pe d to re pa ir a nd re pla c e a g ing a nd c ritic a l utility infra struc ture ; ma inta in pub lic he a lth a nd sa fe ty; ma inta in utility fina nc ia l he a lth; a nd impro ve c usto me r se rvic e a s pe r the City Co unc il’ s dire c tio n o n Oc to b e r 6, 2015 to de ve lo p a fina nc ia l pla n fo r the 10-ye a r Utility 2.0 Stra te g ic Pla n Optio n 3;

• 2. Re vie w pro po sa l fo r a nnua l c o nsume r pric e inde x e sc a la to rs fo r F

Y 2023-2027;

• 3. Dire c t sta ff to c o nduc t a c itywide c o mmunity o utre a c h initia tive o f

the Utility Ra te Pro po sa l in Oc to b e r a nd No ve mb e r 2017;

Re c omme ndations

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4. Dire c t sta ff to ho ld a jo int me e ting with the Bo a rd a nd City Co unc il in No ve mb e r to disc uss c o mmunity o utre a c h fe e db a c k a nd ne xt ste ps to de ve lo ping a fina l re c o mme nda tio n; a nd

• 5. Dire c t sta ff to re turn with a pub lic he a ring to the Bo a rd a nd City

Co unc il, in Ja nua ry a nd F e b rua ry 2018, re spe c tive ly, with a fina l ra te re c o mme nda tio n, with ne w ra te s e ffe c tive April 2018.

Re c omme ndations